Stephen Colbert-- Here.

Our "Vintage" Video Collection Click On Image

Our "Vintage" Video Collection Click On Image
Great Political Moments Caught For Your Pleasure

Saturday, March 28, 2009

Is The Resurrection of Barack Roosevelt Obama Coming?

Has Timmy Geithner been listening to the title song’s chorus on the great new Van Morrison recording, Astral Weeks-Live at Hollywood Bowl? The chorus is, “I believe I have transcended.” Has the Man-From-Uncle-Goldman Sachs been transcended from the financial crime syndicate’s Trojan Horse into a higher plane where he now wears a big flowing red, white and blue cape as he does battle to rescue the US economy from eminent danger? Oohh Baby, I’m getting chills already!

University of Missouri and economics Professor Michael Hudson, Ph.D, wrote in How The Scam Works, brings up this example that if a “bank now offers $3 million to buy back mortgages [from another bank that believes they are sitting on a $10 million package of collateralized debt obligations that had been put together out of junk mortgages that] what the hell, the more they bid [up], the more they [can] get from the government. So why not bid $5 million. [If] the government-that is, the hapless FDIC-puts up 85% of the $5 million to buy this-namely, $4,250,000 [package, then] the bank only needs to put up 15%-namely, $750,000.”

“Here is the rip-off as I see it. For an outlay of $750,000, the bank rids its books of a mortgage worth $2 million, for which it receives $4,250,000. It gets twice as much as the junk is worth.”

“The more [money] the banks holding junk mortgages pay for this toxic waste, the more the government will pay as part of its 85%. So the strategy is to overpay, overpay, and overpay. Paying 15% is a small price to pay for getting the government to put in 85% to take the most toxic waste off your books.” What an incredible scam upon the taxpayer!!!

Mr. Karl Denninger of wrote in his 3-19-09 piece called Bernanke Inserts Gun in Mouth, he said that “ The error in the hyperinflationist scenario is that without being able to couple price increases back into wages they are unsustainable-price increases instead of collapse demand [collapse of demand and falling prices]. If gasoline goes to $20/gallon you will buy less of it-a lot less-not because you want to, but because you simply don’t have the money. This in turn destroys the gasoline retailer and oil company’s operating cash flow, which in turn causes them to lay off more people. In a debt-laden economy the debt percentage (of GDP) continues to rise even as spending drops and a mad dash to try and redeem what debt can be repaid soaks up all available money.”

“The nightmare scenario that is staring us in the face, right here, right now isn’t hyperinflation. It is in fact a collapse of monetary systems driving demand for dollars through the roof in a crescendo of attempted redemption into collapsed (“no-bid”) asset prices-a demand that Ben [Bernanke] will not be able to meet, as the collateral backing those dollars will have been exchanged for toilet paper. Whether Bernanke holds all this trash on his balance sheet or manages to scam Treasury into exchanging it for T-bills, the result is the same-there is no collateral behind the Bucky [dollar] and as employment collapses no production to replace it will [be there] either.” This might be really hard to get your head around such an economic picture!

Columbia Business School’s Professor Joseph Stiglitz, Ph.D. and 2001 Nobel Prize winner in economics, wrote (Fiscal Plan Fails Both Markets and Taxpayers, 3-24-09, Project Syndicate) “Trickle-down economics almost never works. Throwing money at the banks hasn’t helped homeowners: foreclosures continue to increase. Letting AIG fail might have hurt some systemically important institutions, but dealing with that would have been better than to gamble upwards of $150 billion and hope that some of it might stick where it is important.”

I have said this all along--this is nothing but a trickle-down scam. Professor Stiglitz went on to say that the lack of transparency was the problem and will not offer a solution. By bribing hedge funds and private investors to buy up the bank’s bad mortgage assets will not result in the establishment of a true “market price” for these toxic bombs. Bank losses are already a fact, and now the taxpayers are being told this will be a win-win for just the banks and the government; but how is this a win for the taxpayers who will get stuck subsidizing an over-valued price? The taxpayer will see a loss: privatize the gains; socialize the losses.

University of Texas, LBJ School Professor of economics James K. Galbraith, Ph.D. wrote (This Crisis Is Way Bigger Than Dead Banks and Wall Street Bailouts, 3-25-09, "In late 2007, the ratings agency Fitch conducted this exercise on a small sample of loan files, and found indications of misrepresentation or fraud present in practically every one. The reasonable inference would be that many more of the loans will default. Geithner's plan to guarantee these so-called assets, therefore, is almost sure to overstate their value; it is only a way of delaying the ultimate public recognition of loss. while keeping the perpetrators afloat. When a bank's insolvency is ignored, the incentives for normal prudent banking collapse. [Management] may take big new risks, in volatile markets like commodities, in the hope of salvation before the regulators close in. Or it may loot the institution--nomenklatura privatization, as the Russians would say--through unjustified bonuses, dividends, and options. It will never fully disclose the extent of insolvency on its own. [Management will likely engage in a] combination of looting, fraud, and a renewed speculation in volatile commodity markets such as oil. There is no chance that the banks will simply resume normal long-term lending. To whom would they lend? For what? Against what collateral? And if banks are recapitalized without changing their management, why should we expect them to change the behavior that caused the insolvency in the first place? The odd thing about Geithner's program is its failure to act as though the financial crisis is a true crisis--an integrated, long term economic threat--rather than merely a couple of related but temporary problems, one in banking and the other in jobs." One cannot help but believe that President Obama and Timmy Geithner are not afraid of the less powerful manufacturing CEOs, since they will force them to resign in exchange of government economic support, but are very afraid of the big time thieves deep within the financial industry's syndicate allowing them to keep their seats intact on the deck of the sinking ship.

Professor Paul Krugman, Ph.D. and 2008 Nobel Prize winner in economics said in an interview with Amy Goodman (Have Geithner’s Zombie Ideas Won?, Democracy Now!) that Geithner is “basically saying that, you know, there’s nothing really fundamentally wrong with our banking system; there’s just this stuff that’s ultimately backed by home mortgages, and if only we could get people to see that these things are really pretty decent assets, then the banks will be in fine shape. And that’s [troubling to me during this economic time]. You know, there’s an argument that says maybe they were somewhat underpriced, but to make that the centerpiece of your [Geithner’s] financial rescue plan is just—well…, it leaves me with a feeling of despair.”

So, what is wrong with President Obama? Why does he ignore Nobel Laureates and their opinions? Is he asking to be destroyed? Is he asking for the GOP to cannibalize him if this recovery plan calling for the financial crime syndicate to buy up over-valued toxic debt that they may use against the American people if they decided to throw back their catches?

You know the deal? The buyers of what are now being called “legacy assets” have a money back guarantee. They come up with 15% and if they only want to pay 25 cents on the dollar, Geithner’s taxpayers will subsidize the remainder of the seller’s offer price, which will likely be between 40-60 cents on the dollar.

If Obama falters and stumbles, or, at worst, falls flat-out he will be trampled by the GOP and many who changed their party affiliations to vote for him will retreat back to the Republicans. This will destroy the Democratic Party, which is already devouring their own. The trust will be significantly damaged and the circle (of Hope) will be broken!

Obama is risking his entire reputation on a weak and historically failed policy of trickle-down economics. One cannot help but believe that we are on the verge of actually losing our democracy. A Mussolini-like Republican is waiting in the wings. One has to believe that President Obama is being controlled by the very powerful forces within the financial banking crime syndicate to reuse Dr. Frankenstein’s horror machine to make sure the Ponzi monster lives on to trickle-down the fatal gruel in the form of Monster Mash.

J.P. Morgan manipulated the financial markets just before the stock market crash and the bank runs that led up to the Depression. He was responsible for the hundreds of bank failures, therefore it is not conspiratorial to believe that this bank syndicate dragon had been kept alive all this time and not slain generations ago.

I have a prediction that was seen in Madame Joy’s crystal ball. After she put herself under a hypnotic trace, the crystal ball lit up brightly spinning the gold and silver and cobalt blue colors which told this story. The banking industry is in a dilemma right now. They have backed their spankin’ cheeks too close to the hot and raging fireplace because they are now either going to have to put up or shut up. If they put up, then they will have to buy up the toxic “legacy assets” at the inflated and over-valued prices amounting to two to three times their actual market values. They may never be able to unload them unless they back out and dump them back on the taxpayer. This action may enrage the taxpayers for being dooped by the scam and call for nationalization, or force the banks to handle their own toxic debt bombs. The citizens will rally behind President Obama when he says that he bent over backwards to make a deal with the bankstas.

Now, if they shut up and don’t bite, then President Obama will look like the Emperor With No Clothes and the GOP will hammer him as they unleash the vulgar and despicable racist dogs on him. If the banking cartel decides to “shut up” then Obama will realize that the biggest crime syndicate set him up to look ineffectual and unable to bring the banks to the banquet table and gather up platefuls of toxic mortgage debt bonds after weeks of public reassurances and pitches; and, we’ll all see that a scam had taken place. We will see that the set up was to move the Trojan Horses: Geithner, Bernanke and Summers right up to his free throw line. This is all becoming transparently clear to more and more people.

This is a face-off. President Obama will see that maybe even his closest confidantes, Raum Emanuel is in on the coup. With the cowards- Pelosi, and Reed pissing in their woolens, they’ll switch sides for enough campaign cash if it will fill the gunnysacks under their desks.

Hillary knows that she will go down, too, unless she joins with Barack. She knows her career will be over, as well, if she abandons him, since she has few fans in the Republican camp.

The set up is that if the banking cartel shuts up, then the Mussolini exhumation will begin ushering in what Carl Rove dreamed of—the 100 years of Neo-Fascism-oligarchy-style.

But Obama will not take this lying down!! He will transform himself into Luke Skywalker to take control, and it must be done in a New York Minute. He will nationalize the failed banks—all of them. They will be consolidated overnight, stripped of their assets, and the zombie executives thrown out on the streets only to be shut out of the dark hovels that would protect them from the daylight and citizen vigilante groups look for revenge-European style. He will then take all the cash that had not been stolen and siphoned off by the crime syndicate kleptocrats and put into an Obama Industrial Marshall Plan—New Deal Initiative—relying on the Democratic governors throughout the country to give him cover as they throw him lifelines ASAP. This will be Roosevelt Obama resurrected!

The unemployed will be hired to work the program. Obama will command the FBI to bust open the banking crime syndicate and prosecute the thieves and robber barons.

This will astonish our world allies, and begin to revitalize our trade alliances. Rush Limbaugh and the other Neo-Con Freaks may actually have to go into hiding doing only Internet shows from undisclosed secret locations.

WOW! Madame Joy is something else, isn’t she? I think it is now time for me to wake up, and shake it off. Although, it is always good to dream.

thanks for reading, jerry

Tuesday, March 24, 2009

TALF, and the Obama-Geithner Public-Partnership Plan

Has President Obama jumped the cravace safely reaching the other side, or will he lose his momentum and fall, whereby he, personally, will need a rescue package? What has now been put into action is the Obama/Geithner Private-Public Partnership Plan, whereby private investors seeking to buy into the banking industry’s toxic mortgage backed securities pools will get their chance to help move the stuff off the bank’s balance sheets freeing them up to make more loans without the toxic boogieman lurking deep within their balance sheets. What a comforting thought, except banks have been lending in spite of this liability. There is no problem with liquidity. What we have is a solvency problem. Also, there is a confidence issue. No one really trusts what has been going on for quite a while. I guess, this is a plan to make the banks solvent again in just a matter of weeks. The taxpayers will become Mr. Clean and wipe all the dirt right out of their balance sheets.

We the public, along with the FDIC, will take on, at least, 85% of the risk of the sales of these toxic debt instruments, while the private sector takes on around 7% of the risk. But if the private sector sees that the toxic debt instruments are really worth less than they bought them for, and not the grade quality they believed they were, then they can ask for a refund. At that point, the public eats the deal. Sweet, aye?

TimmyG finally blew some very bad notes from that rusty horn he has been carrying around with him; or, has he? The way this all will come down is that these toxic securities will be auctioned off to the highest bidder. TimmyG is hoping to get around 40-50-60 cents on the dollar. The prospective buyers, such as hedge funds, JPMorgan Chase, PIMCO, and the others are hoping to get a really good deal, whereby, sometime in the future, they would be able to sell the stuff at a profit.

My question is if 40-50-60 cents are what TimmyG thinks these securities are worth, then why haven’t these banks sold them for that price already? Many experts believe that they are worth far less than even 40 cents on the dollar. Some have stated they are only worth around 25 cents on the dollar. That is quite a discrepancy, in my opinion. So, since 2007, when this all blew up, no one has actually unraveled these debt-engineered assets (now that is an oxymoron) to find out what they are really worth?

As I recall TimmyG, Ben Bernanke, and Larry Summers were there when the Bush Bailout began. They had their secret meetings, including their former employer-Goldman Sachs, discussing who will get what when the bailout money got dropped out of Bernanke’s helicopter. They all knew then what was causing the bank failures, but they did not choose to unravel the toxic mortgage backed securities when it all was unfolding. They were all in bed together trying to prevent an economic nuclear meltdown. But it did. It happened. We are now living it. It continues everyday, although Wall Street does not think so. If you are still in, I sure hope you know when to sell because a technical upswing in the market may not be real. And now, we are to believe that this plan will all make it better. Or is it actually the kiss of death on a very deep wound.

TimmyG is stress testing these toxic securities. I guess he should know their worth, but the reality is that stress testing will not unravel these securities totally exposing their actual values. It is all a game of Estimation. It is not like the weather forecaster on the evening news saying it will rain tomorrow so don’t forget your umbrella and jacket, only to find out the next day that there is not a single cloud in the sky from morning ‘til night. Not a really big problem that will totally f**k up your life for years to come. Or, how about generations to come.

President Obama has walked up to the casino table, and placed his bet that credit will get flowing again with this plan. He is betting that all boats will rise once the banking crime syndicate is completely saturated with trillions of taxpayer dollars in spite of their criminality in this entire mess.

Nobel Prize winner in economics Professor Krugman says he is very skeptical that this plan will work. But we all know that TimmyG is smarter than this Nobel Prize winner; and Professor Stiglitz, also is a Nobel Prize winner and skeptical with the plan. And, don’t Professor Noriel Roubini, who questions the way this administration is moving toward unraveling the “trash”. They are trying to increase asset values, bring about inflation, and move the economy using monetary policy instead of a ground-up worker driven New Deal type initiative. Professor Krugman has stated that he does not believe that these toxic securities are worth what TimmyG claims they are worth, but if they are, he will say he was wrong.

President Roosevelt, upon entering the White house, and before the war began, hired 60% of all the unemployed to build roads, bridges, create the Tennessee Valley Authority, bring “rural electrification” to rural America, build government buildings, and the Cathedral of Learning in Pittsburgh, hire government workers, teachers, and artists lowering unemployment from 25% to 10%. Americans, during that Depression, invested in treasurys, and it took 25 years before the banking industry gained what it has lost. The banks were not all that significant in the recovery plan, at that time. But they sure are now!!!

President Obama, I, too, hope you are right. I hope your scheme will work out just fine!! I hope that the $1 trillion dollar “cash for trash” plan turns out to rescue the economy from its slide into the abyss. Only an evil person would hope it would fail, no doubt for the sake of media ratings.

What is interesting is that no one really knows what these toxic mortgage (residential and commercial) backed securities are worth because when the mortgages were originally gathered up into the “sell-off” basket over at the Shadow Bank, which specialized in crafting “creative”, non-regulated, non-transparent, non-identifiable over-the-counter pools of mortgage back securities, which were all mixed together like the Daily Lottery ball machine, one could no longer tell which mortgage out of the bunch was the healthy one from of all the diseased ones. Once they were all mixed up and poured into molds, slices were taken, called tranches, and sold off to suckers all over the world. Then AIG sold counter bets, or should I say insurance.

It was like a slab of Mystery Meat. Somewhere in that slab of strange food, was a portion of actual real quality triple A graded meat. But you actually could not see it, nor even assume it was in there. So now, the Mystery Meat, which eventually ended up on your plate sitting before you, had a long and winding road of travel before it was able to get close to your fork. The same goes for these mortgage backed securities.

Yet, TimmyG has a way to unravel and stress test these slabs of Mystery Meat. Good luck, Timmy. I hope you are reallllllllllllllllllllly smart because you will need a scalpel, blank microscope slides and very technical tools to separate the good from the bad from the ugly.

President Obama has placed his bet to win. If it works, and he hits with real winnings, then he will become King Neptune who guided the horribly wounded ship through rough waters and into safety. But, if not, and the plan falls flat, and his toxic MBS rescue plan to facilitate more lending fails, he will have given the vile vitriolic GOP assault team all the ammo they will need to devastate his presidency.

We will know within the next several weeks.

thanks for reading, jerry


The blogspot called Economicrot has kindly posted this article. 

Sunday, March 22, 2009

Will President Obama Call Eliot Ness Immediately!

Is Barack just too young to figure out this economic disaster and what to do about AIG? He must not be familiar with the television show The Untouchables, about a real character named Eliot Ness, played by Robert Stack. Eliot Ness was born in 1903 and lived until 1957. He was a Chicago lawman who went after gangsters. He declared war on the mob.

I watched that show religiously between 1959-1963. President Obama was too young to learn the one lesson that the show taught everyone, which was to get those bad guy gangstas!

Also, I watched The Lone Ranger, too. He was a masked man who rode the western landscape capturing 19th century villains with his faithful companion, Tonto. The Lone Ranger was a Texas Ranger, and not the same ones who enriched George W. Bush. One of his many missions was to rid the west of bank thieving crooks. The series was aired long before Obama was born. It ran between 1952-1954.

President Obama grew up not watching the moral valued television shows of my youth. If he had, he would take heavy action against the thieves and robbers of our current mega-banking industry.

No doubt, what he would do is call Eliot Ness, The Lone Ranger, and, of course, the infamous Jim Bowie, a 19th century legend, American pioneer and valiant soldier. With these three iconic American heroes, they would all become deputized, of course, gather their weapons and pile into tricked out modern surveillance vans. During the early morning hours, they would surround the headquarters of AIG during one of their secret executive ritual sacrificial meetings. One where they engage in strange branding exercises. Rumor had it they were going to rebrand their name to IGA. Ah, ha!

The deputized four would surround the building, over-power the guards, and raid the stockade, so to speak. They would blindfold the high ranking officials and send them off to secret detention camps to be tortured and held in cages in some undisclosed location without the opportunity to speak to a lawyer. We will make an example out of them.

Hey, we did it in Iraq, so why can’t we do it to AIG? We take over the boardroom, all their computer hard-drives, raid the snack machines and occupy the building. We declare Nationalization. We’ll call in all the bond and stockholders immediately under the threat of rendition. Then, we hire all the unemployed barbers, and beauticians and force all the bond and stockholders to line up for haircuts. None get away without a haircut! So, what is he waiting for?

There is a populist uprising occurring in the streets. It is boiling and percolating by the hour, yet he keeps telling us that he has confidence in Brownie Geithner—Heckuva Job, Timmy!

Could it be that Barack Obama is just too green around the edges? And, I don’t mean “Green”, just green, as in Kermit.

The author of the, David Michael Green (there is that word again-green), a professor of political science and a terrific writer of political commentary, was a tried and true Obama supporter. But now, he believes “Barack Obama is dumber than an bag of hammers.” In his latest piece, he pounds on Barack Obama. Mr. Green said, “…I never thought I’d witness such inane stupidity (or, worse-is it venality?) from the man.” He went on to say, 
“…and thus, it is no exaggeration to say this vibrant and well-liked president, who carries the hopes and aspirations of a nation on his shoulders with a robust foundation of good will to match, is potentially giving away everything in order to make sure that a band of corporate pirates [at AIG] keep their stolen taxpayer money. And, doing that, ladies and gentlemen, is as dumb as…Well, you know.”

Well said!

It looks like President Obama and AIG CEO Edward Libby, are filming a new television reality series called Bankstadog Millionaire, or Who Wants To Be A Banksta Thief Millionaire?

Has Obama been handcrafted by a little known woodcarver and toy maker named Geppetto, who has now become president, and for some odd reason decided to hire on the woodshop’s pest, Timiny Cricket as his economic sorcerer? Timiny tells him that if he does not obey the bankers, then he, Barack, will grow up to be a donkey. This frightens Barack. But unfortunately, Barack did not realize that that was only a joke, since he was already a donkey and not an elephant!

Why does President Obama want to give the GOP—the Grotesquely Oligarchist Psychopathetics—currently staged by one Rush Limbaugh and his band of Jingle Jangle Jindals, a chance to exhume Dr. Frankenstein from the grave in order to create a new monster, which would, no doubt, take the nation closer to a fascist kleptocracy, which recently came to an abrupt end on 1-20-09?

His Knights at the Roundtable appear to be Trojan Horses for the financial banking crime syndicate. Why? What are we not being told?

Will someone, PLEASE, call Eliot Ness right away!

Thanks for reading,  jerry


U.S paralleling Japan's Deflationary Period. A good read to think about. The Fed has something to worry about.

Tuesday, March 17, 2009

What Type of Country Does President Obama Want To Create?

What type of economy does President Obama want to see raise from the ashes of our economic national disaster, and what has become an actual Code-Red national security risk? As Professor Michael Hudson has elaborated on in his articles, we have had a monopoly-debt-financial capitalist economy over the last 30-plus years. This debt-asset financial policy has slowly dominated and subverted our economy as it has forced down and away the only honest and productive way to build an asset-product-based economy, which is from the bottom-up. This can only be done by making things. Inventing new products, systems and technologies that will make this nation better, more energy efficient, productive, and restore our standing in the world.

A manufacturing-based economy, which is what China has fostered, is the only way to create a sound GDP. But, ever since President Carter’s presidency, making real things has been replaced by designing “creative” debt-asset securities and derivative vehicles to sell all around the world. This fraudulent scheme was a conspiracy fashioned by the nation’s smartest MBAs from Harvard, Yale, University of Chicago, and other well respected business schools housed within prominent universities which infiltrated government and spent years going through the revolving doors of Washington, lobby and consulting firms and the headquarters of industry designing laws and policies that favored the elites. These fraudsters were the best and the brightest who were employed by the most powerful financial corporatists that sat around the exotic hardwood conference tables in the various neo-con think tanks, and international power-body assemblies, such as the Council on Foreign Relations, the IMF, The Project for a New American Century, The American Enterprise Institute, The Heritage Foundation, and The Brookings Institute.

No doubt, within the underlying code-worded discussions, which focused on ways to exploit the world’s work forces by exporting manufacturing jobs to countries where work rules, environmental laws, child-labor laws, and work safety rules were to be exploited, and ignored and replaced, with a philosophy where citizen’s rights were less important than those of the industrialized nations. Cheap labor, and being union-free drove their code-worded conversations. How could the rich become richer was their rubric?

So, the smartest MBAs were directed to figure out ways to make finance the New Economy for the United States. It was the biggest snow-job sale’s pitch the world had ever been exposed to. We were told that we would have more leisure time, and be able to pursue all the personal pleasures we dreamed of. All we had to do was buy into this Ponzi scheme. And, very many did! They borrowed on their homes, took part of their wages, and used their credit cards. In other words, leveraged their “potentialized” wealth to buy into the Securitized Paper Magic Products, which came off in sheets, that took various debt-based instruments, such as mortgages, credit cards, consumer paper, tuition loans, car loans, home equity loans, business and corporate loans and sold interest-bearing debt obligations, which were given false AAA ratings by the insider rating agencies, and insured against loss by a bunch of devil-wizard companies, such as AIG, to build a monopolized financial capitalist economy. Now, AIG has spent taxpayer dollars paying off foreign investors who were caught up the credit default swap scam, as well as giving millions of hush money payments to keep their “Best-of-the-Best” from writing a tell-all book. We have been paying off as taxpayers the richest of the rich who made bad investment choices by believing in the world’s biggest Ponzi schemers. Yet, no one is bailing out the real economy workers who lost 45-50% of their retirement and over $8T in homeowner wealth. This is a Reaganomic Trickle-Down scheme, which caused the collapse in the first place. Obama and Geithner and Bernanke and the rest of Knights of the Team Obama Round Table believe that the richest of the rich should not suffer, should not get financially hurt, and should not take a hit, if they are going to jumpstart the economy by investing in it. As we know, they have never invested in the economy before, so why should they start now. They took their wealth and made money only for themselves. Only the working classes should take the hit, as they pay for the world’s biggest Great Escape! It was not unlike those magic rocks that we, as kids, put into water to supposedly make living things grow out of nothing. “Just add water, and you will be rich!”

For over 30 years we have been told that a monopoly-debt financial capitalist economy would be good for us. Monopoly referring to the mega-financial institutions that were able to convince a bought-and-paid-for Congress to pass laws allowing these big banks to merge together institutionalizing themselves into what has been coined “Too-big-to-fail” corporations. In addition to these monopoly companies, we saw our auto industry, food industries, utility industries, insurance, and real-estate, to name a few, pyramided into monopoly monoliths, which were able to lean heavily on our legislators through campaign contributions, and lobbyists with their pressurized arm-twisting methodologies.

Wealth grew for many and, especially, for those at the upper 10-20% of the income ladder. They saw their capital gains, revenues made from compounded interest payments, and/or dividends explode into paper wealth. These were the people that saw their Paper Magic wealth grow, whereby they could expand their trophy shelves with all kinds of expensive goodies. But the rest of Americans saw their jobs disappear, and their wages grow, at most, by 1% per year, if that. They had to borrow to keep up their stagnant or shrinking standard-of-living because the wealthiest of the wealth class were forcing up asset values on property, company share prices, and many other goods, services and products through inflation.

As working Americans saw their jobs shipped overseas through this monopoly-financial capitalist economy, the investment class got richer, especially those who could afford to extract their wealth from the growing Ponzi scheme before it caught on fire. As industrial developing nations expanded, the financial capitalists took their wealth and began to not only build factories overseas to make cheap stuff to sell at Wal-Mart, but build office buildings, shopping malls, turnpikes, shipyards, airports, rail stations, utility infrastructure and apartment/condominium buildings in the developing world. Then when it was to their advantage, they bought foreign currencies to offset the devaluation of the dollar, as former vice-president Cheney did, as well as stock shares of companies in the emerging market sectors.

All of this came at the expense of U.S. worker!!! The U.S. worker was the sacrificial lamb as the world developed into a very competitive force challenging the product-based capitalist economy of the United States. Corporatists, such as Bill Gates, and others, sought for the Congress to allow foreign workers to be given special status in order to further subvert wages by hiring them instead of domestic professional workers further eroding wages and our standard-of-living.

This has been a race to the bottom. The American worker was the expendable commodity in this Ponzi scheme. Today we cannot find enough jobs for newly graduating young Americans, especially those who have studied liberal arts, fine arts, and are pursuing other minimally marketable career choices made so by this economy. Even those who graduate in engineering, languages, business, and science will have as much trouble as carpenters, electricians, and plumbers when looking for work. The educated worker might actually be having a harder time, since their skills are exportable, while labors and tradespersons possess non-exportable skills.

The monopoly-debt financial capitalist economy is disintegrating rapidly. It was all a scam. It was a head-fake! A week or so ago, the DOW Jones was where it was back in 1997, and now it has returned to where it was before the big dive below 7000. There are no gains; there is no asset wealth boom; Americans were sold a bill of goods that ended up turning into Monopoly Play Money.

So, what type of economy does President Obama want to see rise from the rubble during his 4-year term? Now, if he wants to resurrect the product capitalist economy (Professor Hudson calls this the Mature Capitalist Economy), then he better get busy! Jobs are disappearing and may reach 800,000 per month in the coming months.

Bada Bing Bernanke, and TimmyG cannot stimulate the economy through monetary policy. It just won’t work. The creation of esoteric debt instruments, or taking a blowtorch to the frozen credit pipeline will do very little. What needs to be done is government investment into the funding of manufacturing jobs and industrial jobs that will build a new production-based capitalist economy for domestic and export production. This will improve our GDP, our standing in the world, the lowering of our trade deficit, and the lowering of our national and budget debts. It is so simple that President Obama’s daughters could figure it out.

If he were to ask Malia or Sasha the following question, what would their answer be?

If for some unfortunate reason an entire town burns down in a forest fire, how best would it be rebuilt? Would you use the dollars to directly hire construction workers, bricklayers, electricians, architects, designers, utility line workers, suppliers, and others to rebuild, or would you give the same dollars to banks so they could improve their balance sheets, while, at the same time, giving the bankers raises, and bonuses, so as to prop up their mega-financial institutions even though they were losing more than they are taking in, and made it very difficult to lend out the given dollars to those who needed to rebuild? Do we give it to those banks, which then in turn, might lend it out, or you might say dole it out, to the unfortunate townspeople, of their choosing, who need to rebuild their lives once again? Malia or Sasha, what answer would you chose?

No doubt, they will pick the first one. It is so simple that a child could easily figure it out. But, their father, and his Knights sitting around his Round Table feasting on the best food money can buy seems to have chosen the second answer. Look where has it gotten us! Further down the black hole, it seems. Yes, our health care system is a major problem for us, and needs to be fixed quickly. That is simple, too! Single-payer. Our military spending needs fixing, as well. Simple. Cut their budget in half. The daily damage is impacting upon us and penetrating directly into the labor side with disappearing jobs!!!

Through the restoration of jobs, building new manufacturing industries to rebuild America into an energy independent country, with a high speed rail network, insulating every single home in the country, establishing sources of local food production, efficient farming techniques, alternative energy grids, the allowance for farmers to save their own seeds from their own supplies, instead of our food supply being exploited and controlled by Monsanto, and there is more, of course, we would discover that the Treasury would be able to replenish dwindling tax revenues with new tax revenues, as well as our state and local governments seeing their coffer grow, at the same time.

I don’t think President Obama needs to spend valuable time meeting with bi-partisan committees and community groups, nor try to reassure and encourage us to stay calm through his radio and television broadcasts that we can endure through our resiliency, which will allow us to come through these terribly tough times as we have in the past. The Great Depression was a time we surely don’t want to relive as a result of bad policies. These rough times are not meant for platitudes, but for aggressive decisions and actions that may not be popular with the monopoly-debt financial capitalist royalists, such as the jihadi Right-wingers in Congress and the jet-setting corporate elites who contribute to campaign war chests. President Obama must embrace the populist agenda wholeheartedly; otherwise he may repeat the failures of the past.

Thanks for reading, jerry

Monday, March 9, 2009

President Obama, Whose Free Market?

President Obama continues to capture the audience. The Republicans have resorted to Bobby Jindal, and that did not turn out too well. Now, they are inciting tea parties. Do you get finger sandwiches with that? I am not sure it makes much sense. Former Little Boy Bush doubled the national debt while president. He ushered in a massive housing bubble that broken spreading recessionary fallout all over the nation causing homeowners to run from their nests by the millions; manufacturing companies began to lock up their doors and pull the blinds; working people were checking their mailboxes only to find letters saying their retirement savings got contaminated for life; 36,000 laid-off workers per week have been roaming the streets desperate for answers; all occurring as the fallout from the Bush presidential legacy drifted all across the globe. Yet what we hear from the Republican Jihadists is that President Obama must NOT spend money to help working Americans come out from under their desperation. It is all their fault and no one else is to blame. So now, the Republican Jihadists are hosting tea party protests to complain that the new budget is too high and the stimulus costs are too much. Did any of these naysayers ever tell Little Boy Bush, or Johnnie-man-to-the-rescue-McCain, as he ran to the Senate floor during the presidential campaign, that the Toxic Asset Relief Program (TARP) was a bad idea and the bankers need not get handed $700B to squander on fancy plane rides, and lavish luxury pay bonuses? I guess not. I guess all of this is Barack Obama’s fault. He is the big bad wolf in a nice tailored suit with a commanding presence. And, of course, don’t forget that he can give a darn good speech, too. Wow! He can even articulate what the problems are and what his plan is, even though there are many who do not agree with the objectives.

My problem with President Obama is that because of his economic plans, he continues to stand too far in the middle for my taste. I do believe he could be setting himself up for a big fall that will damage the Democratic Party if he is not careful. He is taking too long to move in more aggressive directions to salvage our very damaged economy.

I have to ask, what free market system does he support? Free, as in free from bondage enforced by the predatory private power brokers? Or, a neo-liberal free-for-the-taking-market? Free as a bird? The free lunch counter type of market where it is all you can eat without getting a check, but the cook pays the customer as a thank you for allowing him to be in the free market economy? A market free from regulation, and controls, and along the way, given a free hand to create an economic monopoly. Free from as much competition as possible. As Professor Michael Hudson wrote in his 2-24-09, article, “The Language of Looting”--

“…today’s “neo-liberal” advocates of “free” markets seek to maximize economic rent—the free lunch of price in excess of cost-value, [and] not to free markets from rentier charges. [Or] attempts to regulate “free markets” and limit monopoly pricing and privilege [which] are conflated with “socialism”, [and] even with the Soviet-style bureaucracy. The aim is to deter the analysis of what a “free market” really is: a market free of unnecessary costs: monopoly rent, property rents, and financial charges for credit that governments can create freely.”

What I believe he is saying is that through monopoly and debt-finance economic principles, of which our mega-corporate and financial systems have been freely enjoying without much interruption from The Regulatory Enforcers, most of us working in small and moderate sized business enterprises, and those who own them, have felt significant downward pressures that high rents, and compounding bank finance charges have squeezed against their limited profit margins, ability to expand, engagement in research and development projects, opportunities to increase wages and benefits, and/or hire new employees, thus, might find themselves pushed outside of the competitive playing field by those heavy power brokers controlling the monopoly and financial capitalist economy. This world ain’t big enough for the both of us, pal!

Professor Hudson also wrote that those progressive economists living a century ago would never have thought that “a world run by venal and corrupt bankers, protecting as their prime customers the monopolies, real estate speculators and hedge funds whose economic rent, financial gambling and asset-price inflation is turned into a flow of interest in today’s rentier economy. Instead of industrial capitalism increasing capital formation we are seeing finance capitalism strip capital, and instead of the promised world of leisure we are being drawn into one of debt peonage.” (Rentier is defined as someone who has a fixed income, as from stocks, land, etc.)

We have watched this happen over the last 30 plus years, as industrial capitalism diminished in its usefulness as a prime economic generator of wages, and products to be used domestically and exported, as well as a major source of revenue for the federal Treasury, state and local governments, giving meaning, value and prestige to a product-dollar-based currency. A currency given value through the production of real tradable and tangible goods had been gradually upstaged by our current esoteric, paper-generated-based financial capitalism economy (40% of our GDP) funded through securitization and the interest payments received from such debt, or as some would call assets, has now significantly disappeared into the wild blue yonder. Most of our production has been handed over to rising industrialized developing nations. More than likely not to be seen again unless dragged back onto our own soil kicking and screaming from those monopolistic capitalists very happy to have them operating elsewhere and far away from unions, U.S. government scrutiny, regulation and laws. This is President Obama’s most important dilemma from my point of view. What type of “free market” does he wish to establish under his presidency? Is he more in favor of debt-asset values replacing product-asset values?

Professor Hudson asks, “Exactly what does a free market mean? Is it what the classical economists advocate—a market free from monopoly power, business fraud, political insider dealing and special privileges for vested interests—a market protected by the rise of public regulation from the Sherman Anti-Trust law of 1890 to the Glass-Steagall Act and other New Deal legislation? Or, is it a market free for predators to exploit victims without public regulation or economic policemen—the kind of free-for-all market the Federal Reserve and Security and Exchange Commission (SEC) have created over the past decade or so? It seems incredible that people should accept today’s neo-liberal idea of “market freedom” in the sense of neutering government watchdog. [And] loot without hindrance or sanction, plung[ing] the economy into crisis and then use Treasury bailout money to pay the highest salaries and bonuses in U.S. history. [And] when neo-liberals use the word “nationalization” they [really] mean a bailout, a government giveaway to the financial interests.” (All [ ] had been inserted by this author.)

Professor Hudson wrote further in a terrific enumeration that “Today’s clash of civilization is not really with the Orient; it is with our own past, with the Enlightment itself and its evolution into classical political economy and Progressive Era social reforms aimed at freeing society from the surviving trammels of European feudalism. What we are seeing is propaganda designed to deceive, to distract attention from economic reality so as to promote the property and financial interests from whose predatory grasp classical economists set out to free the world. What is being attempted is nothing less than an attempt to destroy the intellectual and moral edifice of what took Western civilization eight centuries to develop, from the 12th century Schoolmen discussing Just Price through 19th and 20th century classical value theory.” “Any idea of “socialism from above” in the sense of “socializing the risk”, is old-fashioned oligarchy-kleptocratic statism from above.”

So, where will President Obama take the nation and all of us inside it riding the bus with him and his Inner Circle? I surely hope it won’t be over the cliff, but instead, down a road that maybe rutted and bumpy, which will require skilled steering and navigation, so as to end up on the road that will lead us into a new, and balanced mature economy that protects workers, worker rights, while freeing the nation from its grip upon fossil fuels by embracing sustainable energy and agriculture, with available health care for all, and sustainable job opportunities working in manageable industries, with regulated investments, without wars, and bloated defense and security department budgets. We have to ask, “So Mr. President, where are you taking us? And, what type of free market are you choosing?”

Thanks for reading, jerry

Tuesday, March 3, 2009

Is America Destined To Decline?

Former President Bush in his fully delusional way, tried to reassure us that the “fundamentals are good” when speaking about the crash and burn of his economic policies. Now, Federal Reserve chairman, Ben Bernanke has said the same thing, but in a more nuanced fashion. On 2-24-08, he said that we could see the economy turning around, and the recession will end sometime this year, if the financial markets would get lending underway. But, if the markets don’t thaw, then we will continue on our downward spiral. Is he delusional, as well? Does anyone actually believe that our markets, by mid-year, could resume their business-as-usual operations and rescue our economy from collapsing even further? Does he actually see our financial sector, and himself as a deputized sheriff’s posse armed and ready to do battle with the ole’ Black Bart gang in hopes to eradicate the hovering and quaking town’s people from the bad guys, which had spent months terrorizing the town-folk robbing their bank deposits, tool sheds, and precious household items? We will watch to see if he’s blowin’ smoke in the wind.

Friday (2-20-09) was a bad day for Wall Street, as well as the trading days that followed. It hit a 12 year low on 2-23-09. The DOW continued to show that individuals, and large investors are getting out of equities. This would have happened no matter who became president. The market is destined to significantly lose more of its value. One market prognosticator was predicting a drop to 6000 on the DOW for Friday (2-20-09), but it would not have been that far from reality to guess a 7000 weekly finish. And now, as of March 1, 2009, the DOW found a new resting place below 7000. (During this pull from equities, the savings rate has climbed to 5%, the highest since 1995.)

There is no more faith in the system. President Obama is not helping America’s perceptions, either. In only 4 plus weeks, he has not helped me feel better about our future, although I want him to. President Obama is playing politics and not acting in the best interest of the nation’s future. He comes out insisting that he has belief in the private banking system. Now, if we were to take a poll asking if we had faith in the country’s biggest financial banking system, my guess is that he would be very outnumbered. But I may be wrong, since so many really are ill- informed on the facts. No one has faith in these thieves, who continue to look for ways to steal as their ships submerge themselves, and us too, under water even as the taxpayers try bailing out them out.

I want to be optimist about President Obama’s American Recovery and Reinvestment Act of 2009 in hopes that it might lift the country from this economic forest fire, but unfortunately, those firefighters he armed with the tools to begin squelching it appear to have a “pyro-maniacal” history.

Secretary of the Treasury Tim Geithner learned the ropes as a protégé at Kissinger and Associates, and Kissinger has been affiliated with the Council on Foreign Relations, which has the world’s most powerful multi-national corporations and financial institutions as corporate members, such as AIG, JPMorgan, Citigroup, Merrill Lynch, Morgan Stanley, UBS, Nasdaq, American Express, Mastercard, Deutsche Bank, Bank of America, and a host of “Too-Big-To-Fail” future bailout recipients.

Tim Geithner also worked with Robert Rubin, who was Clinton’s Treasury Secretary, and had spent 26 years at Goldman Sachs, plus was temporary chairman for Citigroup, as well as serving as senior counselor, and as a current advisor to President Obama. Tim has had his hands deep in the IMF, which serves the elite investor class in third world nations leaving the people of those countries indebted to the IMF for compounded interest payments, and, the Council on Foreign Relations, with an agenda to protect world trading markets, in addition to solidify the free flow of international central banking lender/borrower capital, and was chairman for the New York Federal Reserve Bank as the economy melted down under Bush. He and Ben Bernanke sit on the board of directors of the International Bank of Settlements, in Switzerland.

Now, is there any question who Tim Geithner represents when it comes to the economic stimulus? It appears he has been deeply embedded in the elite banker’s camp. Mike Whitney (2-18-09, wrote that Geithner is a “Trojan Horse for the banking oligarchs. He has already admitted that his main goal is to, “keep the banks in private hands”.”

There are several people surrounding President Obama who come from Goldman Sachs, or other financial zombie (insolvent) banks. Where do their historical loyalties lie?

The mega-bailout-banks are further declining in value, yet the administration continues to allow them to function as private institutions. They need to be nationalized immediately. Taken over not by private committee members chosen by the financial community, but by government, and government regulators. Let the FDIC take them over.

Without Americans working, there is no economy! Labor, and industry add real value to the economy, and generate tax revenues. This cannot be said for the financial sector, which has added nothing of real value to the economy, nor has it generated a product that can be held in one’s hand. Would you rather hold a paper saying you own some (virtual) silver, or the actual silver coins?

The White House bugle call is to fire up credit, and get the middle class borrowing again. I say, for what? To be put us personally further into debt? What for? It looks like the administration wants to re-enflame the personal debt firestorm by ushering in a new bubble. All they wish to do is to ignite the idle bank lending departments within the offices of the zombie banking institutions for the purpose of issuing credit to those willing to buy those depreciating new homes that are backlogged 14 months, sell the hundreds of thousands of cars that are parked on the manufacturer’s storage lots, help parents and their kids with their tuition bills piling upon the balance sheets of those unfortunate students who will likely not be able to find relevant jobs in their field’s of study, even while those with jobs wait in silence and with trepidation not knowing if they will be the next in line to get Pink Slipped. Those tuition bills, with compounding interest, will be sitting in their mailboxes on the first day of their graduation awaiting the first of many payments more than likely putting major stressors on that former student’s budget. These will be difficult times for the nation’s best and brightest people so willing to make a difference with the knowledge they have worked so hard to obtain. It is sad that so many Baby Boomers cannot retire allowing spaces for new graduates to fill. But the banksters want to get bailed out. They want to preserve their wealth, even though they are the ones who have destroyed this economy, and the job prospects of the nation’s children and grandchildren.

We have reached 19,000 unemployed per day and this is likely to remain consistent. A shocking unadulterated, nor manipulated unemployment statistic of 17.5% when factoring in the underemployed, as well as those who are no longer looking for work and not included in the factoring process, may very well increase. Many are predicting as high as 20-25%. Those were the figures during the Great Depression!

The White House needs to realize that Americans have begun to stop buying stuff and that is why demand has fallen off, and supply is piling up. Those businesses with an over-supply are dropping prices, creating deflation, to liquidate their stock, and that has kept prices down for the many items unsold. Oh, how the corporate elite wish to see inflation take over so price asset values can climb forcing working Americans to borrow, once again, because of their stagnant wages, allowing the banksters to take those fresh loans and securitize them through private, unregulated “shadow banks” again inflating a new asset bubble to replace the last broken one. We don’t need more personal debt, as I have stated before. Yet, they have not woken up to the realization that the previous purchasers of structured investment (debt) securitized vehicles don’t trust them and won’t buy their new ones. It appears that the only way they would consider buying our risky securities would be if the taxpayer guaranteed them from default!!!! It will likely remain all frozen up unless TimmyG writes those guarantees adding to our national debt, while not contributing to the actual economic recovery of the nation. President Obama has not given us a strong reason to believe in many of his decisions over the last few weeks. Most of us want to. He is smart enough to begin fixing it. We want him to fix it. We need him to fix it. As Keenan Thompson, a cast member of Saturday Night Live has said in a skit, “JUST FIX IT!”

What might actually thaw it out is if Americans had good paying jobs and our manufacturing and industrial sector was rejuvenated through a fully focused manufacturing stimulus and revitalization plan.

What if all the “too-big-to-fail” banks and multi-nationals, which have already failed in spite of massive cash infusions, such as, car companies, insurance companies, and the rest were all to be broken up into smaller, manageable, and more flexible “not-too-big-to-fail” companies by the Justice department inside the Obama administration? This idea was purported by Dave Lindorff, in his latest article ( He suggested that the anti-trust laws be dusted off and used across all sectors.

If this were to happen, many small and midsized companies, which have difficulty competing against the mega-corporations for market share may end up gaining new market positioning. These companies would have a much better chance of exporting their products, as well as competing domestically, if we no longer had multi-national, mega-corporations that wielded international power resulting from their global muscle and brawn being flexed inside such organizations as the Council of Foreign Relations, as well as our own Congress.

Consumer confidence will not be coming back soon as long as President Obama clings to the financial elites, who surround and strong-arm him into preserving their power over worldwide financial markets, the issuance of credit, and their stranglehold over our legislative bodies. These predators thrive on compounding interest rates, and inflated rent pricing. As Americans learn just where his economic team comes from, they shake their heads in disbelief realizing that nothing really has changed.

A real progressive and populist agenda is what would rescue the nation from freefall. The conservatives fear labor and the strength of an economically healthy working middle class society, as well as real competition in the market place. They fear that they would not be able to sell their ideology to a gullible and broken society. If President Obama used the funds issued in his stimulus and recovery plan in a bottom up manner, the nation would get back to work remaking itself in a new and better image. This would add to the real economy, and begin to expand and reproduce building a more productive and healthy economy. An image the rest of the world would follow, and have faith in once again.

Thanks for reading, jerry