The formula, in my view, would have been to let every major bank and casino house fold in 2008. Then take 1/2 of the Fed-gotten-goodies we produced out of thin air, and push that over to the base of the pyramid in the form of a social safety net, to deal with the depression that would have resulted.
At the same time do a society-wide revaluation of assets and commensurate consumer debt forgiveness.
Instead of that, we pour tens of trillions into the top of the pyramid, only to keep the old ponzi scheme going, while inventing brand new ones to get lost in. And then we just hand over the cash to boot, with no lending requirements.
You're right, we're stuck now. Banks won't lend and consumers won't borrow. But that won't change, it's too late for that now. All we have from now on is government gimmicks, bubbles, and an ocean of public and private debt, until the whole thing folds in on itself.
I wrote up in a blog post. I was fairly surprised TARP is projected to turn a slight profit.
Frankly I think it's all ill gotten gains, but it could be worse, they could have lost that money.
It's really dense and that's because of the insane amount of programs out there, I concluded it was meant to baffle, so the report you must track each mnemonic to each program and then to the money outlays of it.
But, it appears Citigroup is a black hole which has fallen off of the public radar screen.
On the Economy, we need major structural change. Not only do we need major financial reforms, the entire economy, these policy makers refuse to deal with globalization.
But our current state of purgatory will not change without some significant shifts in policy. Banks will not provide credit to businesses because they are insolvent but are being propped up by the Fed and Treasury.
Sadly the train has left the station for debt forgiveness in the private sector. That needed to start en masse about a year ago, when our government was faced with a choice - bail out the people or bail out the very gangsters that caused the mess, and our government chose the banksters over the people.
Which is the moral hazard that undercurrents the whole situation. Not discussed as much, but it will be the moral implications of all this that will tear our nation apart in the years to come. When that time comes, no charts will be needed for the average American to understand what happened.
They'll understand that the situation midowng so ably presents was willful. It was the financial elites stubbornly refusing to let the people off the hook, when they could have done so. The people are the last ones in to a giant ponzi scheme. And our government willfully decided to pour whatever it can conjure into the top of ponzi scheme to keep it going.
The crisis is not economic, it's moral. Bernanke and co. are amoral men, Destroyers willing to sink a nation to protect it's elite. The people haven't figured it out yet in large numbers, but hopefully they will.
IMHO, Prof. Steve Keen has it right - debt and deflation. The question is what do we do? MASSIVE DEBT FORGIVENESS OF PRIVATE SECTOR DEBT - DEBT JUBILEE. Kill the parasites in the financial sector. Press re-set on financial sector and start over.
Hence Marc Faber's target for the future value of the dollar: $0. Faber is given to melodramatics, but he has a point.
With Ambac threatening bankruptcy and Jim Chanos recommending going short municipal bonds we may be seeing the early signs of the real debt bubble collapse. Geithner and Bernanke have their fingers in the dike, but the water is lapping over the top. They're hoping to raise the height of the dike through inflation, but dollar revulsion may come first.
As a middle-aged saver, I see myself losing either way.
Can revoke their privileges, claims "censure and fine" (yeah, right, fines are usually just a tooth booth fee), but also then it says "separations of sales from ratings..
but turns around and says the commission can give an exemption for this. (p. 691)
It also establishes an Office of Credit Ratings Agencies (p. 695)
Also have the bill title: Restoring American Financial Stability Act of 2009.
I haven't scanned it enough to be sure, although I think all need to read the legislative text plus bear in mind this will be marked up, so I hope Mr. Washington (most interesting nom de plume!) is reading from the actual legislative text.
One point is I agree, because Senator Sanders Too Big to Exist bill is gaining traction, this is a big attempt to kind of water down that movement to simply break up these mammoths, like GS, Citigroup, JPMorgan Chase right now, (w/n 90 days).
Considering Wells Fargo is going into the payday loan business, I think they should be broken up.
I 'm not willing to assume that Ron Paul and I intersect on this bill, so I'll await the analyses of a few people I trust since I am not personally plowing through 1100 pages. Thanks for the summary, Robert.
I'm about to jump out of my skin with the refusal of Congress to do their job instead of corporate lobbyists jobs and start rebuilding this economy with trade, economic incentives, jobs programs and frankly it looks strongly that our entire education system needs reform....seemingly administrators have picked up on the same tricks as executives and are seriously lining their pockets.
Glad to see this post, midtowng. You hadn't posted for a few days and I was worried we lost our best writer!
I have no idea what you are referring to, but you must realize that anonymous comments are not trackable. No one has any idea what you are talking about.
We also live by the calculator on EP, so you can create an account, but if you have criticisms, you have to back it with facts, statistics.
Fortunately I have a way to know if this bill is just feel good phooey or real reform, and it doesn't require me reading a word of it.
Why should I read it, I'm not getting paid a penny to do so. But the financial industry has people getting paid plenty of pennies to scrutinize every word.
If Goldman likes it, then it's trash. If the banksters back it, it's trash. If Ron Paul is against it, it's trash.
Only a bill fought tooth and nail against by the banksters will be any good. Until they scream bloody murder, it's trash.
Max it can be is 100 pages. If it's longer than that, they have to introduce it as a separate bill.
Yeah, it's also fairly silly. Even legislative staffers cannot determine every nook and cranny, even attorneys cannot...in time.
and we know Congress doesn't even read all of these bills...
I trust Chris Dodd like a diamond rattle-back, but I was pleasantly surprised so far with this bill.
Same is true with Frank. He can talk a good game, have some great sounding Populist rhetoric, but just about when it's time to pass something....it's gutted.
I know EPers are starting to get a good grasp on the financial crisis from all of the posts on it. So, I'm hoping all will scan at least some of the actual bill...
for that is another issue, often bill language is not the same as even summaries and assuredly isn't the same as press releases and rhetoric as we've seen, in mass from the Comprehensive health care bill.
There's that word again! Comprehensive to me implies "lots of hidden lobbyists agendas buried in mountains of paper so we hope you won't notice until it's too late".
Representatives and Senators sneak all kinds of mischief into these. Reconciliation should be about a specific budget or authorization, not a vehicle to do favors for cronies or line up careers after Congress. Does anybody remember the famous multi-billion dollar earmark for the oil industry, with 10 percent dedicated to "administrative costs" for a facility in Sugarland, Texas? Deals cut at midnight such as Rostenkowski's 1986 "tax reform" or the Catastrihic Health Care Plan that almost got him lynched by a mob of senior citizens when they learned what it was going to cost them. We have "Government in the Sunshine" laws for the executive branch, but Omnibus bills are middle-of-the-night affairs, in which the people get screwed.
Frank T.
I personally want to ban from Congress the word comprehensive. We get these massive bills, over 1000 pages and believe me, if one has a legal and legislative background, that means lots of places to hide loopholes, exemptions, poison pills, tricks and games.
I hope all of you take the time to just review at least a few sections of the draft.
I'm getting lonely on here! It's like I'm the only one writing posts all of a sudden!
You might consider creating an account since you are commenting often.
I also have no idea what "Ben belongs with Bernie" means.
It's a time to deleverage.
The formula, in my view, would have been to let every major bank and casino house fold in 2008. Then take 1/2 of the Fed-gotten-goodies we produced out of thin air, and push that over to the base of the pyramid in the form of a social safety net, to deal with the depression that would have resulted.
At the same time do a society-wide revaluation of assets and commensurate consumer debt forgiveness.
Instead of that, we pour tens of trillions into the top of the pyramid, only to keep the old ponzi scheme going, while inventing brand new ones to get lost in. And then we just hand over the cash to boot, with no lending requirements.
You're right, we're stuck now. Banks won't lend and consumers won't borrow. But that won't change, it's too late for that now. All we have from now on is government gimmicks, bubbles, and an ocean of public and private debt, until the whole thing folds in on itself.
Ben belongs with Bernie.
I wrote up in a blog post. I was fairly surprised TARP is projected to turn a slight profit.
Frankly I think it's all ill gotten gains, but it could be worse, they could have lost that money.
It's really dense and that's because of the insane amount of programs out there, I concluded it was meant to baffle, so the report you must track each mnemonic to each program and then to the money outlays of it.
But, it appears Citigroup is a black hole which has fallen off of the public radar screen.
On the Economy, we need major structural change. Not only do we need major financial reforms, the entire economy, these policy makers refuse to deal with globalization.
But our current state of purgatory will not change without some significant shifts in policy. Banks will not provide credit to businesses because they are insolvent but are being propped up by the Fed and Treasury.
RebelCapitalist.com - Financial Information for the Rest of Us.
Sadly the train has left the station for debt forgiveness in the private sector. That needed to start en masse about a year ago, when our government was faced with a choice - bail out the people or bail out the very gangsters that caused the mess, and our government chose the banksters over the people.
Which is the moral hazard that undercurrents the whole situation. Not discussed as much, but it will be the moral implications of all this that will tear our nation apart in the years to come. When that time comes, no charts will be needed for the average American to understand what happened.
They'll understand that the situation midowng so ably presents was willful. It was the financial elites stubbornly refusing to let the people off the hook, when they could have done so. The people are the last ones in to a giant ponzi scheme. And our government willfully decided to pour whatever it can conjure into the top of ponzi scheme to keep it going.
The crisis is not economic, it's moral. Bernanke and co. are amoral men, Destroyers willing to sink a nation to protect it's elite. The people haven't figured it out yet in large numbers, but hopefully they will.
1) mortgage is underwater - owe more than what home is worth;
or
2) no buyers of home at prices needed to sell.
This new tax credit will be useless.
RebelCapitalist.com - Financial Information for the Rest of Us.
IMHO, Prof. Steve Keen has it right - debt and deflation. The question is what do we do? MASSIVE DEBT FORGIVENESS OF PRIVATE SECTOR DEBT - DEBT JUBILEE. Kill the parasites in the financial sector. Press re-set on financial sector and start over.
RebelCapitalist.com - Financial Information for the Rest of Us.
Hence Marc Faber's target for the future value of the dollar: $0. Faber is given to melodramatics, but he has a point.
With Ambac threatening bankruptcy and Jim Chanos recommending going short municipal bonds we may be seeing the early signs of the real debt bubble collapse. Geithner and Bernanke have their fingers in the dike, but the water is lapping over the top. They're hoping to raise the height of the dike through inflation, but dollar revulsion may come first.
As a middle-aged saver, I see myself losing either way.
p. 687
Can revoke their privileges, claims "censure and fine" (yeah, right, fines are usually just a tooth booth fee), but also then it says "separations of sales from ratings..
but turns around and says the commission can give an exemption for this. (p. 691)
It also establishes an Office of Credit Ratings Agencies (p. 695)
Also have the bill title: Restoring American Financial Stability Act of 2009.
Has some good comments on what's missing.
I haven't scanned it enough to be sure, although I think all need to read the legislative text plus bear in mind this will be marked up, so I hope Mr. Washington (most interesting nom de plume!) is reading from the actual legislative text.
One point is I agree, because Senator Sanders Too Big to Exist bill is gaining traction, this is a big attempt to kind of water down that movement to simply break up these mammoths, like GS, Citigroup, JPMorgan Chase right now, (w/n 90 days).
Considering Wells Fargo is going into the payday loan business, I think they should be broken up.
I 'm not willing to assume that Ron Paul and I intersect on this bill, so I'll await the analyses of a few people I trust since I am not personally plowing through 1100 pages. Thanks for the summary, Robert.
Not pretending to be an economist
I'm about to jump out of my skin with the refusal of Congress to do their job instead of corporate lobbyists jobs and start rebuilding this economy with trade, economic incentives, jobs programs and frankly it looks strongly that our entire education system needs reform....seemingly administrators have picked up on the same tricks as executives and are seriously lining their pockets.
Glad to see this post, midtowng. You hadn't posted for a few days and I was worried we lost our best writer!
shows massive pollution. So thick who can breath. They have a growing desert W. of Beijing.
The industrial parks grow like mushrooms and what is more amazing is how these images never seem to make it to U.S. main stream media.
Also, there is a prediction that U.S. cities will get an invasion of rats due to the increasing poverty and decay.
I have no idea what you are referring to, but you must realize that anonymous comments are not trackable. No one has any idea what you are talking about.
We also live by the calculator on EP, so you can create an account, but if you have criticisms, you have to back it with facts, statistics.
> So much to debunk in one section and so little time.
Since you didn't even try and yet you had time to post an empty reply, the conclusion about your position is obvious.
Fortunately I have a way to know if this bill is just feel good phooey or real reform, and it doesn't require me reading a word of it.
Why should I read it, I'm not getting paid a penny to do so. But the financial industry has people getting paid plenty of pennies to scrutinize every word.
If Goldman likes it, then it's trash. If the banksters back it, it's trash. If Ron Paul is against it, it's trash.
Only a bill fought tooth and nail against by the banksters will be any good. Until they scream bloody murder, it's trash.
Max it can be is 100 pages. If it's longer than that, they have to introduce it as a separate bill.
Yeah, it's also fairly silly. Even legislative staffers cannot determine every nook and cranny, even attorneys cannot...in time.
and we know Congress doesn't even read all of these bills...
I trust Chris Dodd like a diamond rattle-back, but I was pleasantly surprised so far with this bill.
Same is true with Frank. He can talk a good game, have some great sounding Populist rhetoric, but just about when it's time to pass something....it's gutted.
I know EPers are starting to get a good grasp on the financial crisis from all of the posts on it. So, I'm hoping all will scan at least some of the actual bill...
for that is another issue, often bill language is not the same as even summaries and assuredly isn't the same as press releases and rhetoric as we've seen, in mass from the Comprehensive health care bill.
There's that word again! Comprehensive to me implies "lots of hidden lobbyists agendas buried in mountains of paper so we hope you won't notice until it's too late".
Representatives and Senators sneak all kinds of mischief into these. Reconciliation should be about a specific budget or authorization, not a vehicle to do favors for cronies or line up careers after Congress. Does anybody remember the famous multi-billion dollar earmark for the oil industry, with 10 percent dedicated to "administrative costs" for a facility in Sugarland, Texas? Deals cut at midnight such as Rostenkowski's 1986 "tax reform" or the Catastrihic Health Care Plan that almost got him lynched by a mob of senior citizens when they learned what it was going to cost them. We have "Government in the Sunshine" laws for the executive branch, but Omnibus bills are middle-of-the-night affairs, in which the people get screwed.
Frank T.
I personally want to ban from Congress the word comprehensive. We get these massive bills, over 1000 pages and believe me, if one has a legal and legislative background, that means lots of places to hide loopholes, exemptions, poison pills, tricks and games.
I hope all of you take the time to just review at least a few sections of the draft.
I'm getting lonely on here! It's like I'm the only one writing posts all of a sudden!
How Much of it was Reagan's Fault?
I think these two posts are great because this is one hell of a myth, trickle upon economics "saved" the economy from stagflation.
I'd have to review but I believe Volcker saved the economy at that time. (with a whopping painful adjustment).
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