Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

[open4]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Simon Johnson’s analysis is money centric and assumes good finance to be almost an end in its self , going no further than seeking to ensure that credit is only extended when repayment can be made,
Money should be no more than a simple and inert tool and needs putting in its place,
What is important is the health of society at large and it is the misuse of credit that is the main problem, for example simply ensuring that credit is only extended to those likely to repay it would not ensure that totally destructive but otherwise profitable organizations do not prevail,
Stress testing banks and reorganizing those that fail may appear to be an answer to some economists but will not resolve deep underling problems of the real world,
Unhealthy distortion of markets by credit and invisible taxation through government fiat can probably only be controlled by a return to the intrinsic disciplines of the gold standard,
Quite simply we would have arrived at this same financial halt if all people had issued their own unrestricted credit and bankers had not existed,

[Mega]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

I disagree

China can change tack, she has the production means, she has the labour force. As Schiff sez all she needs do is de-couple & her own 1.3 billion consumers will pull her & the World out of this mess.

China will NOT want short term quick fix.

Mike

[Charles Mackay]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

I'm shocked! The fact that this is creeping into the MSM is a very positive sign. I'm less bearish after viewing this!

But, not by much, .... ;)

[icm63]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

China can change tack, she has the production means, she has the labour force. As Schiff sez all she needs do is de-couple & her own 1.3 billion consumers will pull her & the World out of this mess.

When Peter Schiff said that China will do better when USA is down, he stated that China middle class will be able to buy the toasters that they sold in the USA for $11 USD themselves, thus creating a strong domestic economy of internal consumption, as China will be able to consume what the previously exported. This may be when the price of tin and copper fall so low that China can make the toaster for $1.50 and sell it for $2 to the local chinese man earning $1 a day. If it does happen it will only be a after a period of ecomonic adjustment that wont be pretty. That adjustment has been called deflation in the past.

Gary Shilling went to China and found that China's middle class wealth is only 5% of the population (100 mill persons or so, same size as Japan) hardly enough to support the massive work force that used to reside in the factories of China making stuff for Walmart etc

So China is not able to help the rest of the world, if you state that they are NOT happy about exports falling, well thats an easy group to join, every exporting country is NOT HAPPY.

China, via Jim Rogers, is better aligned to a quicker recovery as they having savings and little personal debt, hence he says buy the yaun.


China will say, the Toaster we sold to USA for $11, cant be done for profit no more, make toaster and selling it for $2 to China man in Peking, this means factory job goes form $1 a day to $0.10 a day, do you want the job or not !!! Deflation...economic adjustment...that what will happen, and that will spark there growth faster that western economies.

[Slimprofits]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

CNBC came out last Thursday with their own take: House of Cards

House of Cards - Origins of the Financial Crisis ''Then and Now''
"Let's hope we are all wealthy and retired by the time this house of cards falters."
--Internal email, Wall Street, 12/15/06

Prophetic words that predicted the greatest financial collapse since the Great Depression. The current global economic collapse has its roots in the sub-prime mortgage crisis.

"House of Cards" premieres Thursday, February 12 at 8p | 12a ET.

[Chris Coles]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

We are missing the point if we focus on China. The focus should return to the subject of this thread which is that there is a feeling that Timothy Geitner

http://www.telegraph.co.uk/news/worl...re-junkie.html

does not have, for want of another word, the cojones for the job in hand. That he has not started out in the manner anyone with knowledge of such matters of leadership expected.

[open4]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Dear Mr Johnson,

You are wrestling with the problems of credit only because you have failed to accept its true nature,

Credit is fraudulent money, and is always to some degree damaging,The question is to what extent this fraud should be tolerated, if any,

Finance must be linked to a gold standard, fractional Fiat and credit fraud must never break free of this discipline,

The conceit and security of the bankers rides on the back of much of the public who also gained money for nothing and know they are complicit in this fraud,

The power of the bankers will collapse only when the public realise they have lost their ill gotten gains,

[labasta]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

I should have posted this on this thread:

I'm hearing so many cases of fraud worldwide at the moment. Has anyone picked up on the 1.3 billion dollar fraud in Iraq by the US military? I mean skimming form the top is all well and good, but plain out stealing the whole lot.. well...

Regarding Ireland.

I'm really pissed at the whole thing with the banks at the moment.

The directors of AngloIrish gave themselves non-recourse loans based on collateral of their own AngloIrish shares. One of these loans was for 87 million Euro. We are talking hundres of millions here. Fine right? Well when the bank goes bankrupt, the shares are worth nothing. They don't have to pay back the bank as the loans are non-recourse. In effect, they just stole the money for themselves.

Now, the ruling party (FF) use the bank for their own funds (apparently) and the finance minister took advice from the directors of the bank. He saves angloIrish bank by raiding the civil servants pension fund to the tune of 7 billion. This has been estimated to be nowhere near enough. Who tops up the missing 7 billion? Is it the directors? Noooo, of course not. The civil servants have to pay an extra pension levy of around (after tax) between 3.5 and 9% of gross income. This is at a time when pivate AND (although much less) public sector workers are losing their jobs and having their wages decreased. The ones with massive mortgages are taking a bigger hit. If mortgages can't be paid, the banks take the hit and so on.


Basically, what I am saying is that the ones who stole, frauded, created the mess are not paying for it but making off like bandits and leaving the rest of us to pay and become poorer.

It would have been the same if a few years ago during the bubble years the government had created an AngloIrish monthly tax levy of around 5% to be paid to the directors of AngloIrish bank directly.

I mean Germany has compulsory medical insurance (also known as a tax) to keep its med industry in lolly, why not the banks too. Let's have politically in their pocket industry taxes!

30% for the banks
20% for the med industries
5% for petroleum companies
10% other energy taxes
2% for the church of your choice

Can we think of any other industries which like to kept in the manner they are accustomed to?

Now, if only I could set up a company to pay off a load of politicians and create my own tax on the people.

[Roughneck]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Perhaps geitner did not state the specifics of the plan because he did not want to tell poeple the truth,just yet. Perhaps he didn't want to say that it will take another 3 trillion dollars to stabilize the big banks until after the "stimulus bill" was passed.Or maybe he's just a dumbass government technocrat who really doesn't have a clue.Either option is not that comforting.

[metalman]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Perhaps geitner did not state the specifics of the plan because he did not want to tell poeple the truth,just yet. Perhaps he didn't want to say that it will take another 3 trillion dollars to stabilize the big banks until after the "stimulus bill" was passed.Or maybe he's just a dumbass government technocrat who really doesn't have a clue.Either option is not that comforting.

meanwhile, back in california...

With no budget, California to cut 20000 state jobs
Reuters - 39 minutes ago
The announcement came a day after California lawmakers narrowly failed to pass a $40 billion budget that would have plugged the state's deficit with a mix ...

massive state layoffs... that'll fix up the econ in a hurry, so say the libertarians. fewer state employees = less taxes = more money to spend on crap made in china. and the ex-state employees won't go on unemployment, they'll invent the next internet, start companies, and we'll all live happy ever after. the logic is inescapable.

[grapejelly]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

The bill that fell one Republican short would have practically double car tax, increased sales tax to 8.25% (before local taxes which could raise it to near 10% in places like Los Angeles County) and other fees...

What they should do is massively cut the government payroll by 1) pay cuts and 2) permanent layoffs.

Tax increases will make the business climate, already abysmal, even worse. It will drive more businesses out of California.

I would never, never never locate a business in California ever again, barring something unforeseen.

The National Enquirer carried an article about a man who rides around in a wheelchair and sued 150 small businesses over the past year and a half an earned a cool $100,000 for violations as minor as having a mirror or counter 1/2 inch too high for the disabilities statutes.

This neatly encapsulates everything wrong in the Socialist State of California...

[qwerty]

The Best Treasury Dept That Money Can Buy

I'm shocked! The fact that this is creeping into the MSM is a very positive sign. I'm less bearish after viewing this!

But, not by much, .... ;)

I thought it was in the Steve Keen interview(*) that I read the idea that Obama knows he can't take over the banks just yet, he needs to wait until JPM and Goldman sink more before he can summon the required political will. (* But it must have been somewhere else)

But talking of the politcal will to change things, we may not need to wait on the main stream media in our world of Web 2.0.

iTulip.com is a place of debate, and I guess, not the place for helping direct collective action.

Anyone running a website out there selling Break The Banksters bumper stickers? Maybe stickers you can have delivered to your congressman?

[D-Mack]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Perhaps geitner did not state the specifics of the plan because he did not want to tell poeple the truth,just yet. Perhaps he didn't want to say that it will take another 3 trillion dollars to stabilize the big banks until after the "stimulus bill" was passed.Or maybe he's just a dumbass government technocrat who really doesn't have a clue.Either option is not that comforting.

He was the head of the NY Fed, that should say it all.

Geithner's Debut: "Not Ready for Prime Time"

by Mike Whitney

...

GEITHNER"S SPEECH

Geithner knew exactly what he had to say on Tuesday, but hemmed and hawed and avoided the central issues like the plague. He provided no new details on how the government planned to remove the illiquid assets that are fouling the banks' balance sheets nor did he explain how he would determine the value of these assets. It is shocking to realize that the financial crisis started 19 months ago (when two Bear Stearns hedge funds defaulted) and still, no one has any idea of what these assets are really worth. Price discovery is basic to any functioning market but, in this case, fear has carried the day. Everyone involved is terrified that trillions of dollars of assets will turn out to be worthless.


Geithner employed the same obfuscating techniques as Alan Greenspan. He tried to affect the look of a man who was deeply concerned while rattling off well-rehearsed statements that revealed absolutely nothing about his real intentions.

“I completely understand the desire for details and commitments," Geithner opined with heartfelt sincerity, "but we’re going to do this carefully so we don’t put ourselves in the position again....This is the beginning of the process of consultation." The there was this gem worthy of Maestro himself, "We are exploring a range of different structures" to deal with precisely that issue.

Right.

Most of the critics believe that Geithner is in over his head, but that's probably not the case. More likely, he has a plan but wants to keep the public in the dark. After all, there's no graceful way to tell people that they are about to get shafted for another $2 trillion to keep the larder on Wall Street full of Dom Perignon and chocolate truffles.

One thing Geithner will insist on is that the Treasury and the Fed remain the final arbiters of "who is solvent and who is not" as regards the big banks. That should be Sheila Bair's job. As the head of the FDIC, Bair is the regulator who should be in charge of checking capital reserves and closing underwater banks. But, apparently, Bair has been crowded out for political reasons. Geithner and his insider friends are calling the shots.

Geithner announced that Treasury would be putting together a new "public-private investment fund" to try to attract private capital to assist the government in purchasing some of the higher-rated assets the banks are trying to unload. The details are still sketchy, but it sounds a lot like Henry Paulson's Super SIV (structured investment vehicle) which provided a spot for the banks to dump their off-balance sheets garbage in one "government approved" SIV. Of course, the idea failed because, by then, investors were already skittish about buying complex, structured investments. Even so, Paulson's credibility took a real beating. He was seen as using his office to peddle dodgy bonds for his friends. Geithner won't make the same mistake. He'll take the high-road and entice the banks and hedge funds into buying the distressed MBS by providing government guarantees and subsidies similar to the perks in the Merrill Lynch-Lone Star transaction. In that deal, Merrill offloaded $31 billion in toxic CDOs for $.22 on the dollar and provided 75 percent of the financing. It was a sweetheart deal from the get-go and Geithner will undoubtedly duplicate it to get rid of the junk at no risk to the buyer. That will help fatten the bottom line of the teetering banking fraternity.

Geithner's financial rescue plan includes $500 billion to $1 trillion for the Fed's Term Asset-Backed Securities Loan Facility (TALF). This will provide additional funds for institutions that finance pools of car loans, student loans, credit card debt etc. The securitization of consumer debt, which broke down 19 months ago when the crisis began, has resulted in an unprecedented slump that's put the world economy in a tailspin. Securitization has been Wall Street's golden goose. It's a reliable way to maximize leverage on smaller and smaller slices of capital. As borrowing increases, asset prices rise, making the system more and more unstable. When the bubble finally bursts; the tremors ripple through the real economy sending asset values crashing, equities markets plunging, and unemployment skyrocketing.

In his speech Geithner admitted that, "In our financial system, 40 percent of consumer lending has historically been available because people buy loans, put them together and sell them. Because this vital source of lending has frozen up, no plan will be successful unless it helps restart securitization markets for sound loans made to consumers and businesses -- large and small.”

40 percent! Think about that. Nearly half the credit pumped into the economy comes from securitization.

...

http://www.globalresearch.ca/index.p...t=va&aid=12301

[rj1]

Re: Bill Moyers reveals to the world the true root of the US banking crisis: FIRE Economy Oligarchs

Interesting bit today as far as the crisis and removing people from power, as influence is power.

http://www.cnbc.com/id/15840232?video=1037776243&play=1

[zoog]

Re: FRONTLINE: Inside the Meltdown

See also:FRONTLINE: Inside the Meltdown, Tuesday, February 17, 2009, at 9 P.M. ET on PBS

Just finished watching this on TV. It covers Bear Sterns, Lehman, AIG, Fannie & Freddie, the attempted rush congressional bailout bill, and a little beyond that. A couple things I didn't know, like when Paulson called the heads of the nine largest banks to his office and basically said "we're going to give you money in exchange for some control, here's a one-page explanation of the terms and conditions, sign it". The program portrayed Paulson as truly being concerned about moral hazard and reluctant to take any actions which might call that into question... but ultimately resigned to bailouts and capital injections fearing the entire system would otherwise collapse. I guess my angry west coast yokel view has always been "oh there's Paulson bailing out his Wall Street buddies again" but I could be wrong. Anyway all in all I thought it was a reasonable account of what happened.

edit add: Saw something on PBS website indicating this is the first of a three-part series on the economic crisis. Don't know when the next two parts will air.