American Blog

Submitted by YOUR NEW REALITY

The strangest, and sometimes most shocking, world-impacting events seem to have a tendency to occur on the 11th of a month.

So what will happen today?

Finance ministers and central bankers from Italy, Canada, the United States, Germany, France, Japan, along with reps from China, Russia, India and Brazil, plus the World Bank and the IMF, descend on Washington for what may become known as The Great American Bailout :

The United States finds itself in a rare position of weakness, facing many allies that have been highly critical of its economic policy and regulatory system blamed for the problems.

Tension is expected at the meeting given recent comments by countries affected by the crisis.

German officials in particular have been openly critical in the past weeks, saying the United States and Britain had delayed for years efforts to regulate financial markets that were out of
control.

The key quote on what to expect comes from German Finance Minister, Peer Steinbrueck :

“The USA will lose its superpower status in the global financial system. The world financial system is becoming multi-polar…”

German media is already blasting the same message that has railed from Iran and Russia - the United States power and prestige in the world has been undermined, destroyed, ravaged, and it won’t be telling the rest of the world how to run its financial affairs anymore.

They are coming to town to rewrite the rules of international finance. They are not coming to hear Bush’s plans, they are going to tell him how it’s now going to be.

All these countries hold American debt, and have invested heavily in American infrastructure and businesses. They want to know that their assets inside the United States will be protected. They will want guarantees.

And if the Greater Depression really is to soon begin in the United States, BushCo. will be asking for help, that is commitments for food and energy aid and debt relief.

China is supposedly refusing to buy another $200 billion of US treasury bonds. These bonds were going to finance the $700 Billion Bush Bailout plan. China is cutting off its credit to the US. Without credit, without Asian credit in particular, the American economy dies.

The US stock market has already crashed today, or as one blithering economic expert on TV said, “crash, slide, call it whatever you want, it doesn’t matter anymore…there’s nowhere to hide.”

Bush pre-empted what will be one of the biggest demands from all those countries attending on Friday morning :

…we are concerned that some investors could take advantage of the crisis to illegally manipulate the stock market. So the Securities and Exchange Commission has launched rigorous enforcement actions to detect fraud and manipulation in the market. The SEC is focused on preventing abusive practices, such as putting out false information to drive down particular stocks for personal gain. Anyone caught engaging in illegal financial activities will be prosecuted.

More Americans will soon be demanding public hangings.

And it’s not just the American public that wants blood. The rest of the world wants those responsible to be held account for what they’ve done. Bush has promised to do this. It might be the only positive thing to come out of his last year in the White House, a pogrom on the misery traders within hedge funds in the US, Israel, England, and a great rounding up of the financial terrorists. And not the fall guys, and the paper stackers, but the real vampires in this blood-sucking, they must be stripped of their ill-gotten gains. All of them.

We’ll see what else October 11, 2008, deals up. It’s set to be an historic day.

A Straightforward Explanation For How Global Economies Went To Hell - Step One : Blame American Greed

Australia’s Black Friday - Markets Suffer Biggest Losses In 21 Years

“Global Solutions” Pinged For Washington Emergency Meeting, As New World Economic Order Follows Wall Street Shock & Awe

Turbulent US Trading, Nothing Can Contain The Great Panic

Financial Warfare Over Future Of Global Bank Power

Begin Again - How To Rebuild Finances And Save The Planet

Washington Post - The End Of American Capitalism?

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Submitted by YOUR NEW REALITY

John McCain provides a brief preview of how BushCo. and then his administration will deal with the breakdown of American society after its economic 9/11 :

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Submitted by YOUR NEW REALITY

If the United Kingdom had been attacked in a nuclear war in the 1970s, here’s some of the prepared script the BBC would have broadcast to flesh-melted Brits :

This is the Wartime Broadcasting Service. This country has been attacked with nuclear weapons. The number of casualties and the extent of the damage are not yet known. Stay tuned to this wavelength, stay calm and stay in your own homes.

Radioactive fallout is many times more dangerous if you are directly exposed to it in the open. Roofs and walls offer substantial protection.

Make sure gas and other fuel supplies are turned off and all fires are extinguished.

You should refill all your containers for drinking water after any fires have been put out, because the mains supply may not be available for long. Until you are told that lavatories may be used again, other toilet arrangements must be made. Water means life. Don’t waste it.

Ration your food supply, because it may have to last for 14 days or more. If you live in an area where a fallout warning has been given, stay in your fallout room. When the immediate danger has passed, sirens will sound a steady note. The “all clear” message will also be given on this wavelength.

Do not go outside the house. Radioactive fallout can kill.

We shall repeat this broadcast in two hours’ time. Stay tuned to this wavelength, but switch your radios off now to save your batteries until we come on the air again.

Apparently, the BBC had a lot of trouble trying to decide on the right, calming, reassuring voice to tell Britons that their cities have been razed in a blinding flash of light.

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Submitted by YOUR NEW REALITY

Obama is safe, says Oliver Stone :

“In those days, with Kennedy, you could kill somebody and that was more palatable because we’d done that abroad with many people: it was in vogue, it was part of the James Bond thing. Now you don’t need to kill – the media can kill for you.“And I don’t think Obama could [frighten] the Pentagon in the same way. Kennedy was shaking things up: with Cuba he was ready to sign a deal, with Vietnam he was pulling out, with Khrushchev he was signing a deal.”

It’s interesting Stone mentions The Pentagon. He was asked in the late 1990s, by the UK’s Neon Magazine if there was a subject he would never make a movie about. He cited the War Industry, and said he knew better than to ever fuck with them.

Fascinating it will be to see how Stone deals with the issue of President George W. Bush’s ramping up of defence budgets to Cold War spending levels in his new Bush biopic, W.

Perhaps Stone doesn’t fear the War Industry as much as he once did.

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Written by Michael Vass

You have to be impressed by the Congressional Democrats. They have balls. Not brains, just balls. Because that is the only way they can make the claims they do about the bailout deal.

In listening to the Democrats, Barney Frank in particular you would think that the Republicans are staging a massive political coup. That the Republicans are the only reason why the bailout deal that was voted on today failed was their votes. That this is all about politics and the upcoming election.

But if you stop listening to the polispeak in Congress and look at the vote numbers and you see another picture.

The vote was 228 – 205 against the deal. That includes 94 Democrats, which could have easily made the difference and passed the deal no matter what the Republicans did. But they chose to go against their Party and Treasury Secretary Paulson, and President Bush.

Why? Because the deal was horrible. Because there is no confidence in the deal. Because the rush to pass the deal makes you wonder what is in it. Like the fact that a previous version included a stipulation that if this bailout actually got any money repaid that money would not go to taxpayers but would fund a Democratic initiative called ACORN (which has federal problems currently).

Or how about the fact that I have yet heard how the public, that will be buying these assets (bad mortgage loans) could or will get the money back. We will spend $10,000 each, out of our pockets, and if this ever makes break-even or profit there has been no discussion how we get that $10,000 back in our pockets directly. And under the current plans you never will. That is not a political problem, that is just a bad deal.

If this were as political as Democrats would like it to be, then this bad deal would have passed, Senator Obama would have the credit for it (or at least Senator McCain would have the blame) and they would use this to win the election. That didn’t happen.

If this were political, Republicans could have voted for this deal claimed it was because of Senator McCain’s influence and used that to win the election. It’s just that simple.

But Senator McCain, the Republicans, and 94 Democrats are not being political. They are doing their jobs. They are trying to structure a deal that works for taxpayers like you and me. They want to answer (I hope) the question of how the money comes back to you and me, if it ever makes money.

If we want to really be political about this, we can ask why Barney Frank and Chris Dodd could not see the impending problem as late as July of this year yet they are the heads of the Banking and Finance Committees in Congress. They were informed by supposedly brilliant minds on the exact status of the problem, and they crafted laws and regulations to control what happened. They also made enormous amounts of money from the very people they were (supposedly) watching.

Look, here is the reality. Senator Obama and McCain are Senators. One of them will be the next President. They are effectively the leaders of their respective Parties. They need to get into this fray (well at least Obama does as McCian is) and do their jobs. They need to forge a deal, stand together and say they endorse the deal. At that point it will have to pass. And to forge the deal they need to answer the question that I feel is most important, how I get my money back.

Everything that is short of this is polispeak. Every moment that Obama avoids this problem, every moment that they don’t answer the key question, every moment we have no deal endangers America and makes our near-term future that more bleak. And no matter how many Democrats blame Republicans, or how many deny their failure to do their jobs, the outcome remains the same.

Submitted by YOUR NEW REALITY

The cream of the Democrats and Republicans hold stock portfolios worth tens, if not hundreds, of millions of dollars. So it’s no surprise they’re very happy The Big Bailout is apparently going ahead. Their money is safe. How about yours?

They appear to be the ONLY people in America laughing their faces off about this today.

A Goldman Sachs discussion group is filled with dread about what comes next :

“PEOPLE ARE HORRENDOUSLY PISSED ALL OVER THE INTERNET

THERE IS DEFFINATE A SEVERE BACKLASH COMING…. QUESTION IS HOW BIG OF A BACKLASH

i have never seen the internet this pissed before and i have been online since 1992″

“People are extremely pissed off and alot of them. Personally, Im not sure what to believe anymore.”
“don’t underestimate the hillbillies when they get pissed off….. they own most of the guns in the country”

“people need to start canceling their insurance policy. then they need to stop paying their property taxes. then take more action if needed.”

Michael Rivero proposes a totally legal, but devastating, act of mass dissent against the state :

The instant this bailout passes I am taking all of my money out of the bank in protest.

THIS IS A PERFECTLY LEGAL FORM OF PROTEST. It is, after all, YOUR money. It is not a crime to take it back from the bankers who just now lobbied Congress into screwing you for $700 billion. The US Government cannot legally stop you from taking your money out of the bank, nor can they block you from recommending to your friends that they take their money out of the bank.

Yes, the banks just make money out of thin air for the loans that got then into trouble, but under the current laws, they need REAL deposits of REAL money on which to base their loans of created credit. For every $1000 withdrawn from an account, the bank has to call back in $10,000 in loans. It won’t take very many people deciding to empty their accounts to get the notice of the bankers and politicians, and of course, once it gets going, people will empty their accounts rather than risk being left empty-handed.

Some Republicans think the nationalisation of American banks and financial institutions signals the start of Martial Law In America :

And so for the first time in a century, the US Army will deploy armed combat teams permanently on American soil, starting October 1. It will be an “enduring mission”. They call it ‘Brigade Homeland’ :

The 3rd Infantry Division’s 1st Brigade Combat Team has spent 35 of the last 60 months in Iraq patrolling in full battle rattle, helping restore essential services and escorting supply convoys.

Now they’re training for the same mission — with a twist — at home.

Beginning Oct. 1 for 12 months, the 1st BCT will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks.

They may be called upon to help with civil unrest and crowd control or to deal with potentially horrific scenarios such as massive poisoning and chaos in response to a chemical, biological, radiological, nuclear or high-yield explosive, or CBRNE, attack.

Civil Unrest and Crowd Control will clearly be the mostly likely crisis they’ll respond to. Luckily, they will have a “non-lethal package” to “restore normalcy” :

They’ve been using pieces of it in Iraq, but this is the first time that these modules were consolidated and this package fielded, and because of this mission we’re undertaking we were the first to get it.”

What has been tested in Iraq, will be fully operational for use against Americans to “restore normalcy” :

The package includes equipment to stand up a hasty road block; spike strips for slowing, stopping or controlling traffic; shields and batons; and, beanbag bullets.

“I was the first guy in the brigade to get Tasered,” said Cloutier, describing the experience as “your worst muscle cramp ever — times 10 throughout your whole body.

“I’m not a small guy, I weigh 230 pounds … it put me on my knees in seconds.”

Traffic stoppers, road blocks, and Tasers, too.

American soldiers tasering American civilians….

They will be welcomed at natural disasters and massive train wrecks or more inexplicable skyscraper collapses, but not so much at massive protests in the streets of Washington and New York.

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Submitted by YOUR NEW REALITY

The boom :

And then the bust :

More at Grods

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Submitted by YOUR NEW REALITY

China, Japan are the nervous owners of more than $1.1 trillion of American debt. Festy debt.

If BushCo. doesn’t get the $700 billion bailout of Wall Street through, China now warns there will be panic selling of this US debt, with a global financial collapse to follow :

Japan, China and other holders of U.S. government debt must quickly reach an agreement to prevent panic sales leading to a global financial collapse, said Yu Yongding, a former adviser to the Chinese central bank.”If there’s no selling in a panicked way, then China willingly can continue to provide our financial support by continuing to hold U.S. assets.”

An agreement is needed so that no nation rushes to sell, “causing a collapse,” Yu said.

Asian countries together hold half of the $2.67 trillion total (US debt) held by foreign nations.

“Whether some kind of agreement between them to continue to hold Treasury bills is viable, I’m not sure,” said James McCormack, head of sovereign ratings at Fitch Ratings Ltd in Hong Kong.
“It would be unusual. If it became apparent that sovereigns in Asia were selling Treasuries the market would take that quite badly, it’s something to be avoided.”

“China is very worried about the safety of its assets,” he said. “If you want China to keep calm, you must ensure China that its assets are safe.”

No wonder President Bush look so terrified during his ‘Oh Shit, We’re Fucked’ speech the other day :

Or maybe he’s smirking?

But $700 billion to keep China and Japan happy will not be enough. There are, of course, other demands now that America is on the ropes :

Yu said China is helping the U.S. “in a very big way” and added that it should get something in return. The U.S. should avoid labeling it an unfair trader and a currency manipulator and not politicize other issues, he said.

“Why are we piling up these IOUs if they may default?”
“IOUs from the U.S.,” said Yu….”this is paper and it may default and it will not increase China’s national welfare.”

The message is clear. BushCo. will secure China’s holdings of American debt, by staking the financial future, and health and education, of American children as collateral. Or China will drop the hammer. In case BushCo. didn’t get the message, queen takes knight :

Chinese regulators have told domestic banks to stop interbank lending to U.S. financial institutions to prevent possible losses during the financial crisis…
“The decree appears to be Beijing’s first attempt to erect defences against the deepening U.S. financial meltdown after the mainland’s major lenders reported billions of U.S. dollars in exposure to the credit crisis….”

The Federal Reserve and the Treasury do not really need to ride to the rescue of its debt-savaged financial institutions if only they really believed in their own shattered mantras of “Free Market Forever” and “Let The Market Decide.” China, the Saudis, the Russians are all eager to snap up some huge chunks of America at bargain basement prices. In a truly globalised, free market world, all these financial institutions should be up for sale to the highest bidder (with a few restrictions).

But they won’t be doing that. So instead its a betrayal by BushCo. of almost everything principle claimed to stand for, and preached, and it’s America Fleeced :

The world has changed in the past decade. There’s been a steady transfer of wealth away from the United States in a shift most Americans have not yet grasped. But there has been no accompanying transfer of responsibility. New powers are free-riding as if it were still the American century.

It’s not. Imagine if Hu Jintao, the Chinese president, had declared last week: “China has a deep interest in the stability of the U.S. economy and the dollar. We stand ready to help in the essential return of confidence to financial markets. Talks with the U.S. Treasury are ongoing.”
Asians have been saving rather than spending. Their consumers are in better shape, as are their banks. The China Investment Corp. (C.I.C.), a sovereign wealth fund, is sitting on $200 billion (and a 9.9 percent stake in Morgan Stanley) while China’s central bank is managing another $1.8 trillion in reserves.Let’s be clear: this is an American mess forged by the American genius for new-fangled financial instruments in an era where the mantra has been that government is dumb and the markets are smart and risk is non-existent. The responsibility for undoing the debacle is chiefly American, too.

…the U.S. has essentially been on its own. Now foreign banks with U.S. affiliates will want a slice of the $700 billion bailout. That doesn’t make sense until the burden of this rescue starts reflecting a globalized world.

“I think it’s a perverse pride thing….We don’t ask for help. We’re the big, strong father figure. But let’s be realistic: we’re no longer the dominant world power.”

A round-up of ‘Ten Days That Shocked Wall Street And Shook The World’ :

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke had been thwarted all week in their efforts to stabilize U.S. financial markets. Now, early in the evening of Sept. 18, they had a bigger fix in mind, and they went to sell it to Congress.

They sat in House Speaker Nancy Pelosi’s office, at a wooden conference table adorned with pink roses and white hydrangeas, surrounded by more than a dozen congressional leaders.

In the previous four days, Lehman Brothers Holdings Inc. had gone bankrupt. Merrill Lynch & Co. and Bank of America Corp. had rushed into a shotgun wedding. The regulators had pumped $85 billion into American International Group Inc., nationalizing the world’s biggest insurer, and were trying to thaw frozen credit markets and prevent economic catastrophe.

Bernake, a scholar of the Great Depression, let them have it. “The credit lines in the American financial system, the lifeblood of the economy, are completely frozen,” he said…Banks had stopped lending to each other overnight, Bernanke said.That threatened to halt all lending in the U.S., forcing businesses to close and idling workers, the Fed chief said. The Fed also was seeing money being moved out of the country.

“You could have massive failures within days,” he told the group, and it would go beyond the banking system to “large name- brand companies…”

President George W. Bush, Sept. 20.

“At first, I thought we could deal with the problem one issue at a time….The house of cards was much bigger and started to stretch beyond Wall Street. When one card started to go, we worried about the whole deck going down.”

Incredible. The President of the United States told the world that the American economy is a collapsing house of cards. Was he trying to save America or help destroy it?

The plan would raise the ceiling on the national debt and spend as much as the combined annual budgets of the Departments of Defense, Education, and Health and Human Services. Paulson was asking for the power to hire asset managers and award contracts to private companies. Most provisions would expire after two years from the date of enactment.

As details of the Paulson-proposed package emerge, so do concerns that the $700 billion cure may prove worse than the disease, virulent as it has been. Reregulation of Wall Street is one thing, critics say, while redefining capitalism another.

Call it Bushitalism.

A round-up of historic headlines from the past few days. Fucking incredible :

It’s No Longer Unthinkable That The US Government May Default

Panic Buying Of Fuel In Southeast US

US Bailout Remains In Doubt, Day Of Chaos, Talks Implode

Raising The Bar : The Biggest Bank Failure In US History

Borrowing Hits Record Levels, Only The Federal Reserve Printing Money Keeps US Banks From Collapse

Can We Have Some Too?: FDIC Anticipates $150 Billion Bailout

Lowest Levels For US Home Sales In Nearly Two Decades

Seven Year High For Unemployed Americans

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Written by Michael Vass

I just can’t step away from the most pivotal issue in the election and the lives of Americans right now. The spin in the media is that Senator McCain is avoiding Senator Obama on a debate of foreign policy – something McCain has experience at for decades and Obama has a speech in Germany. And many are calling the deep desire of McCain to serve the nation, as was called for by Harry Reid yesterday, a political stunt. Though they ignore the school boy-esque scolding that Obama received when the President called him to the White House today.

But I am tired of hearing Democrats and some media pundits running around blaming every economic woe of the nation on Republicans. There is certainly more than enough blame for all the politicians in Congress, which is why it has the lowest approval rating ever. Republicans have screwed up and spent more than they should. But Democrats have been no better, in fact those that are critical to the finance of the nation have been particularly blind. Mr. Magoo could have foreseen more with their level of information and influence over the years.

But lest my words be seen as partisan, which to an extent I am sure they are as with any pundit or blogger, I present talking heads from across the spectrum of the cable news media and pundits, as well as politicians themselves. Listen to those that we have elected, and their votes and assurances. Then tell me this is only a Republican caused problem.

And please explain to me why we should believe that those that planted the seeds for this problem, and fostered it to the debacle we are required to deal with today, should be believed when they say they have a solution

History of mortgage crisis back to 2003

Fannie Mae and Freddie Mac contributions – Sept 18 2008

Chris Dodd was watching closely but did nothing – August 2007

Treasury Secretary Paulson progress made – February 2008

Barney Frank – Improving regulation of Fannie Mae and Freddie Mac July 14 2008

Obama accuses McCain of opposing reform

Have Republicans tried to do anything?

S. 190 [109th]: Federal Housing Enterprise Regulatory Reform Act of 2005 - A bill to address the regulation of secondary mortgage market enterprises, and for other purposes.

So I also ask this, If Senator McCain did not go to Washington D.C., if the President did not call Senator Obama to the White House, are you sure there would be a resolution to the bailout crisis? Would that resolution be in the best interest of the nation?

Is a debate, that could be easily rescheduled, more important than the potential of 4 out of 5 Americans losing their homes and jobs?

And lastly, isn’t it a bit hypocritical that Democrats claim that the debate must happen because America wants this; yet they defended Senator Obama when he refused for 2 months every request that was made for Obama to join McCain in speaking directly with Americans at town hall meetings across the nation?

Submitted by YOUR NEW REALITY

The ‘Obama-Bush’ Wall Street Bailout

Republicans are mad as hell over the BushCo. Socialist Bailout For Greedheads Plan, or whatever some of them are calling it now, and they’re not gonna take it anymore!

There was a time when Dick Cheney could turn back a Republican revolt on Capitol Hill.

That time is gone.

The vice president traveled to Capitol Hill on Tuesday to silence a chorus of GOP complaints about Treasury Secretary Henry Paulson’s $700 billion plan. But House Republicans who walked into a closed-door meeting with Cheney steaming over the plan walked out just as angry, and they described what happened in between as both “a bloodbath” and “an unmitigated disaster.”

But still :

…lawmakers remained respectful enough to give the vice president two standing ovations.

Only the two? Good God.

Wow.

But all hope is not lost. At least one Republican has a Plan :

John McCain could ride to victory over Barack Obama by persuading voters that the bailout is really the “Obama-Bush plan.”

How angry will Republicans be when they learn that Cheney has known about the bailout plan for a number of months - that is, BushCo. knew this meltdown was coming - and didn’t bother to tell them about it?

Even some of Cheney’s closest friends in Washington appear genuinely shocked that one of the final acts of the BushCo. presidency would be a blackmail-infested final, savage fleecing of the American people.

Many of these appalled Republican senators, already spattered with BushCo. war blood as they watch financial ruin cleave through their districts, obviously want to get re-elected, and they know they can’t effectively or passionately sell the Bailout to the storm of conservative Americans choking up their phone lines and flooding their websites and e-mails demanding to know why ‘We should give more billions to the shitbags who caused all this in the first place’.

This is the crystal clear reality of what the Bailout really means that has already taken deep, firm root in the minds of nearly all Americans, across most if not all mainstream media, the blogosphere, talk radio, liberal and conservative, in a powerful act of dissent, and it will be impossible to rebrand it. Everyone knows this stinks like three day old vomit, and is rotten to the core.

This is a turd that cannot be polished. Even if you freeze it.

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Submitted by YOUR NEW REALITY

How angry are Americans about what has been done to their economy, their savings, their pensions, the value of their homes and the financial security of their children, by a pack of heartless rotten greedpigs?

Very, Very Angry. You scan the comments on major American news sites, along with blogs, and it’s getting scary out there. Talk radio is apparently oozing contempt and fury. People aren’t just pissed off, they’re fucking raw.

A friend in Manhattan called to say he had been down on Wall Street and had watched a non-nutter middle aged man roaring these lines from Taxi Driver, over and over, at people heading into the stock exchange (until a cop warned him to move on) :

Listen, you fuckers, you screwheads. Here is a man who would not take it anymore. A man who stood up against the scum, the cunts, the dogs, the filth, the shit. Here is a man who stood up. Someday a real rain will come and wash all this scum off this street.

There were camera phones on him at the time. Nothing on YouTube yet.

How To Make Americans Very, Very Angry :

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Written by Michael Vass

Warren Buffett has made a significant symbolic action in our economy. He has invested $5 billion into Goldman Sachs, the bank. Not the investment bank but the commercial bank that it has now become. The difference may sound small but it’s huge.

In doing this he has signaled his long-term belief that the American economy will weather this storm. Which few doubted. But this one act is hardly enough to resolve all the issues between now and his normal 5 – 7 year investment window.

Now I realize confidence needed to enter the markets. And the doubt of the bailout plan did not help anything. This is a great stabilizing factor. But the bailout plan is not a smart bet, and will not benefit the nation near-term.

The reality is that the Government wants to give Ben Bernanke $700 billion dollars to accept the bad debt of the financial markets. This is the same individual that failed to identify or resolve the problems in the financial markets that I saw back in January at least. And he is planning to accept every problem every size bank can shovel into this deal.

Have no doubt that every bank is working out how they can get their debt passed onto the taxpayers. These are individuals that were smart enough to create the derivatives that regulators are not smart enough to see as a problem for over 5 years. And suddenly we think that more regulation will prevent bad decisions and prevent being unable to understand what is happening in the markets.

The Government should not be in the business of owning banks. The Government is not smart enough, efficient enough, nor reactive enough. The Government is not able to take on debt at a realistic valuation since it does not understand the value, and thus every dollar spent on the bailout will be a waste. And the Government has never been able to intervene in the financial markets to the benefit the nation or investors.

I would bet that Warren Buffett was asked by the Government to step into the market. He is too strong a figurehead to be ignored, and thus symbolically stabilizes the markets. And the fact that Goldman had to become a less powerful commercial bank, and thus seek out deposits to shore up its bad books and loan reserves, to get the investment by Buffett is telling indeed.

The fact is that nothing will prevent the markets from going lower in the short-term. They need to. And if there is to be any real confidence we need to see other investors step up and make similar styled investments. I want to see the Blackstone Group, and Apollo Investments to make similar steps. Bill Gates too. But that is not happening yet.

The Government has been given time, to sort out what it will do. My advice would be to let the markets sort out the problem created in the markets and bad decisions. Because all a bailout does is tell the markets that the Government will step in every time they make an overly greedy decision. And if you think I am wrong, go back and look at what the auto industry is asking Congress right now.

But perhaps one of the worst things a bailout will signal is opening the floodgates on mortgages. If we bailout bad bets by financials, why not bailout the home owners that made bad decisions? And if we can help those home owners, how the hell can we not say that people like myself that made a smart decision on their loans deserve help too. Why should my taxes go to help pay a mortgage that is not my own? Especially since all those home owners had to do is read their documents and do the math.

The Government is not responsible for correcting the bad decisions those it governs makes. But in making the bailout a fact that is exactly what it is doing. And that is more than a small step towards a socialist government and away from a Democracy.

In the Star Wars movies there is a scene where it is said that

“This is how Democracy dies. With thunderous applause.”

But I believe that that is not the only way we can lose it. It can die with a funnel of money draining from the people. Not as dramatic or poetic, but perhaps far more effective and deceptive.

Submitted by YOUR NEW REALITY

Socialism, For The Rich

The above image is from an earlier story on how Bush embraced China, and Chinese Corporate Socialism for the United States

By Darryl Mason

A very sudden change of heart about the true state of the American economy :

In a briefing to lawmakers Friday, Paulson and Federal Reserve Chairman Ben Bernanke painted a grave picture of an economy on the edge of a major recession and telling them that action was urgent and imperative.

Paulson said. “The financial security of all Americans … depends on our ability to restore our financial institutions to a sound footing.”

Cough Up The Money, in other words. Coming at the end of one of the most turbulent weeks on world markets, and when the American markets were close to total collapse, actually sounded like a threat from Bernanke, head of the most powerful private financial institution in the country. Hell, maybe it was.

Here’s Bush of BushCo :

“We’re going to work with Congress to get a bill done quickly.”

“This is a big package because it was a big problem.”

The plan is designed to let faltering financial institutions unload their distressed mortgage-related assets on the government, and in turn the taxpayer, in a bid to avoid dire economic consequences.

Bush said he worried the financial troubles “could ripple throughout” the economy and affect average citizens. “The risk of doing nothing far outweighs the risk of the package, and over time we’re going to get a lot of the money back.”

 

Key words : “a lot of the money”. Not all, or all and some more.

“People are beginning to doubt our system, people were losing confidence and I understand it’s important to have confidence in our financial system.”

The rest of the world said, “Look, you dumb fucks. Isolate and soak up all that toxic debt or we’re closing you down.”

Bush : “In my judgment, based upon the advice of a lot of people who know how markets work, this problem wasn’t going to be contained to just the financial community.”

 

That’s definitely a threat.

The Bush administration is asking Congress to let the government buy $700 billion in toxic mortgages in the largest financial bailout since the Great Depression…

The plan would give the government broad power to buy the bad debt of any U.S. financial institution for the next two years. It would raise the statutory limit on the national debt from $10.6 trillion to $11.3 trillion to make room for the massive rescue. The proposal does not specify what the government would get in return from financial companies for the federal assistance.

If passed by Congress, the plan would give the Treasury secretary broad power to buy and sell the mortgage-related investments without any additional involvement by lawmakers. The proposal, however, would require that the congressional committees with oversight on budget, tax and financial services issues be briefed within three months of the government’s first use of the rescue power, and every six months after that.

While the proposal contains no requirement that the government receive anything from banks in return for unloading their bad assets, it would allow the Treasury Department to designate financial institutions as “agents of the government,” and mandate that they perform any “reasonable duties” that might entail.

$700 Billion. Financial institutions as Agents Of Government, who will do the government’s bidding, on non-specific requests far in the the future. Bush was asked about Democrats planning to attach aid packages to the bill for the poor, the newly homeless, the soon to be jobless. Bush didn’t like this idea at all. He wanted something that was “the cleaner, the better.”

As if any of this blatant fleecing of the future prosperity of hundreds of millions of Americans was “clean.”

The greatest looting of a nation in all history.

You are witnesses.

It’s the Real Bush Legacy - Privatisation for The Profits, Socialisation for the risks and the debt.

From the UK Guardian :

With the nationalisation of Fannie and Freddie, comrades Bush, Paulson and Bernanke started transforming the US into the USSRA (United Socialist State Republic of America).Then there’s the use of the US Treasury to manipulate the mortgage market, the creation of a whole host of new bail-out facilities to prop and rescue banks and, for the first time since the Great Depression, to bail out non-bank financial institutions.

This is the biggest and most socialist government intervention in economic affairs since the formation of the Soviet Union and Communist China. So foreign investors are now welcome to the USSRA (the United Socialist State Republic of America) where they can earn fat spreads relative to Treasuries on agency debt and never face any credit risks (not even the subordinated debt-holders who made a fortune yesterday as those claims were also made whole).

Like scores of evangelists and hypocrites and moralists who spew and praise family values and pretend to be holier than thou and are then regularly caught cheating or found to be perverts, these Bush hypocrites who spewed for years the glory of unfettered Wild West laissez-faire jungle capitalism allowed the biggest debt bubble ever to fester without any control, and have caused the biggest financial crisis since the Great Depression.

They are are now forced to perform the biggest government intervention and nationalisations in the recent history of humanity, all for the benefit of the rich and the well connected. So Comrades Bush and Paulson and Bernanke will rightly pass to the history books as a troika of Bolsheviks who turned the USA into the USSRA.

Stock Markets Around The World Cheer New Plan To Transfer US Private Debt To National Debt
And it’s not the first time :

Shocking and novel as it may seem in the cradle of capitalism, the American federal authorities have actually had to rescue their private banks at least three time during the past century.

Most recently, the 1980s deregulation of the “S&Ls”, mutual savings and loan associations equivalent to the UK’s building societies, resulted in multiple frauds and colossal misjudgements in lending that left most of them bust. The Resolution Trust Corporation was formed in 1989 to restructure the 747 S&Ls, at a cost to the taxpayer of $125bn (£68bn).

It closely followed the US government’s adoption of the bad sovereign debt issued by many Latin American nations in the 1980s – so-called Brady Bonds.

Half a century before, Franklin Roosevelt used the Reconstruction FinanceCorporation to bail out and restructure banks ravaged by the Wall Street Crash.

Between 1933 and 1945, the RFC lent out $33bn ($1.2 trillion in today’s money) of loans to help save banks and get the economy moving.

Less costly, but no less significant, was the formation of the Federal Reserve System in 1913, a response to the Great Panic of 1907, when many banks failed for want of a central bank to provide liquidity and lender-of-last-resort facilities during runs by depositors.

Yes Of Course Americans Will Have To Pay Higher Taxes, And It Will Be Called Patriotic To Do So :

Policy makers cannot say where it all ends. News reports are unrelentingly talking of “crisis.” After decades of deregulation and free-market fealty, antiregulation, small-government Republicans are putting the government in control of a big chunk of the financial sector.

…voters might well wonder why perhaps a half-trillion dollars — about the same amount spent so far in Iraq — is suddenly available to help Wall Street when promises to address issues like health care insurance have gone largely unkept for years.

Greed, Hypocrisy On A Profound, Monumental Scale :

Conservative Republicans always want the government to stay out of business and avoid regulation as long as they are making lots of money. When their greed, however, gets them into a fix, they are the first to cry out for rules and laws and taxpayer money to bail out their businesses. Obviously, Republicans are socialists. The Bush administration has decided to socialize the debt of the big Wall Street Firms. Taxpayers didn’t get to enjoy any of the big money profits on the phony financial instruments like derivatives or bundled sub-prime paper, but we get the privilege of paying for their debt and failures.

Let’s just consider the money. The public bailout of insurance giant (becoming a dwarf) AIG is estimated at $85 billion. According to one report, that’s more than the Bush administration spent on Aid to Families with Dependent Children during his entire time in office. That amount of money would also pay for health care for every man, woman, and child in America for at least six months.

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Submitted by YOUR NEW REALITY

David Dees nails this moment in history, yet again.

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Submitted by YOUR NEW REALITY

It’s impossible to shake, as Ron Paul reminds us, the war veteran who wants to be president thinks it’s funny to joke about bombing Iran.

“I could never support somebody who thinks that it’s funny to say ‘bomb bomb bomb Iran,’” said Paul.

That has to be the political quote of the year.

Ron Paul wanted to get rid of the Federal Reserve. He ran on that for the Republican nomination. Close down this private financial institution that prints money before it cranks up trillions more in debt for future generations of Americans. Visionary.

Ron Paul was right, of course, about the Federal Reserve. They now own one of the world’s biggest insurance companies, and the American taxpayer funded this. Watching Palin and McCain, twerble grat about the looting of Wall Street, and the Treasury, for trillions of dollars in total, has likely made many Republicans think again about Ron Paul. At least he saw all of this coming.

President Obama should make Ron Paul Secretary of Defence. Republicans like McCain and Palin would have to support this move, of course, if they really want to shake up the “old boy” network in Washington. There’s no “old boy” network in Washington older than the war industry.

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Submitted by YOUR NEW REALITY

It’s just what Americans needed to hear during their worst financial apocalypse since the Great Depression. Oh, how they must have all laughed when President Bush cracked this blitzer :

Reporter: Mr. President, following up on Vladimir Putin for a moment, he said recently that next year, when he has to step down according to the constitution, as the president, he may become prime minister; in effect keeping power and dashing any hopes for a genuine democratic transition there …

Bush: I’ve been planning that myself.

Wired’s Danger Room has been digging to see if President Bush really has the power to the cancel the November elections.

In December, 2000, Bush was quoted as saying : “If this were a dictatorship, it would be a heck of a lot easier, just so long as I’m the dictator.”

That’s not halfway near as funny as it once was.

Here’s Republican Congressman Ron Paul in August, 2004 :

“Every generation must resist the temptation to believe that it lives in the most dangerous time in American history. The threat of Islamic terrorism is real, but it is not the greatest danger ever faced by our nation. This is not to dismiss the threat of terrorism, but rather to put it in perspective. Those who seek to whip the nation into a frenzy of fear do a disservice to a country that expelled the British, fought two world wars, and stared down the Soviet empire.

Liberty is lost through complacency and a subservient mindset. When we accept or even welcome automobile checkpoints, random searches, mandatory identification cards, and paramilitary police in our streets, we have lost a vital part of our American heritage. America was born of protest, revolution, and mistrust of government. Subservient societies neither maintain nor deserve freedom for long.”

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Submitted by YOUR NEW REALITY

Heavy metal has a huge future in Iraq. Traumatised, emotionally shattered kids love Slayer and Metallica, so Iraq’s most infamous metal band Acrassicauda should have a good future. But why is head-banging banned in Iraq?

According to a new documentary about Acrassicauda : “…head-banging is outlawed in Iraq because it looks like Jews praying.”

But doesn’t modern head-banging look much more like the dervishing of Iranian women?

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Submitted by YOUR NEW REALITY

Not McCain, not Obama, not Biden, nor Palin should get an easy ride to the White House. All should be hammered by the media, their histories, their beliefs, their past choices, should be microscoped and shredded. And if any of them lie, and get caught lying, not just The Big Lies but also the particularly pathetic and downright nasty, they should be rocked and humiliated and held to account

The question that stings here is this : Why are chat shows like The View confronting and questioning a candidate better, more fearlessly, more thoroughly, than most of the mainstream political media?

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Submitted by YOUR NEW REALITY

“Is this movie going to get us into trouble?” Leonardo DiCaprio asks director Ridley Scott, of their new movie, Body Of Lies, in this LA Times story.

Why is DiCaprio so worried?

The film, starring DiCaprio and Russell Crowe as CIA operatives out to smash terror cells in the Middle East…

DiCaprio portrays Roger Ferris, an idealistic field agent operating out of Iraq and Jordan who resorts to elaborate subterfuge — concocting a fictitious sleeper cell and staging a mock bombing — to flush a terrorist mastermind out into the open.

American spies torture a suspect….innocent people’s lives are ruined via satellite downlink and foreign nationals who cooperate with the agents wind up being sacrificed in the name of homeland security.

DiCaprio :

“…the more we did the movie, the more we got involved with the day-to-day operations of the CIA — you realize what they’re undertaking. The thought of stopping this in one or two wars? In 10, 20 years? If there’s any moral message to the movie, it’s that we’ve bitten off so much more than we can chew.”

Here’s the trailer for Body Of Lies. It looks spectacular :

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Submitted by YOUR NEW REALITY

A short piece of powerful, patriotic video-making, or creepy Republican-NeoCon propaganda. It can be both, and is.

This was screened yesterday to thousands at the Republican Convention, before John McCain accepted the nomination. Note that President George W. Bush, who rallied the nation from Ground Zero, appears nowhere in the video. The Republican Party has already erased him, with almost five months left in the White House.

It’s worth watching this Republican Party 9/11 Tribute Video twice, just ignore the tedious waffle of commentators after the video finishes.

Watch it once with the sound turned down, which renders the footage and stills to just a bunch of images we’ve seen hundreds of times before, lacking power or even drama now, thanks to the relentless, visual media overdose of 9/11 itself and the endless repetition over the weeks, months, years that followed.

But watch it again with that music, which flows from soft piano to something heavy with dread, menacing, and that voiceover, and the images are transformed. There are many, many people out there who want to kill you just because you are an American, the video warns, and by the way they really hate Freedom.

The message from this Republican Party video is clear : the Enemy is not just Al Qaeda, but Islam itself.

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