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Dr. Robert Needham, Author of Wealth 3.0 Meets with Franchise Interviews - May 19,2009

Tue, 19 May 2009 15:30:00 GMT

Are You Ready For A Revolution? After the financial collapse of 2008, economists predicted that if America did not change, we would slip into another Great Depression and possibly a dictatorship. Dr. Needham sees it another way, he believes that the American dream of freedom beats strong in the heart of our citizens. However, he does believe that it is time for another Freedom Revolution as our forefathers did with Wealth 1.0, except this time it is not for “land”, but “100% ownership of

Wealth 3.0 | Dr. Robert Needham | Franchise | Franchise Interviews | Franchise Radio Show

Interview with Dr. Stan Monteith - May 17,2009

Sun, 17 May 2009 22:00:00 GMT

Dr. Stanley Monteith practiced orthopedic surgery in Santa Cruz for 35 years. During that time he developed a great interest in history and studied extensively, taking the time to go through the personal papers of many people who charted the course of history. He is the author of AIDS: The Unnecessary Epidemic, and his video, The Brotherhood of Darkness, was also made into a book. In 1994 he retired to devote full time to passing on the knowledge he had gained to the American people. He chose

Dr. Stanley Monteith | shadow government | Brotherhood of Darkness | financial armageddon | aides

The Rebirth Celebration- Midpoint of the Sixth DAY Galactic Underworld May 9-11, 2009 By C. Calleman - May 02,2009

Sat, 02 May 2009 19:08:27 GMT

To understand our current situation according to the Mayan calendar I believe it is necessary to first backtrack somewhat and look at what has happened at the most important of the recent shift points of the Galactic Underworld (see Fig. 1).
A very important such was the beginning of the fifth NIGHT, November 19, 2007. In my book The Mayan calendar and the Transformation of Consciousness, written in 2003, I ended the discussion about economy (page 233) with a prediction relating to this point in time: “Regardless of what forms such a [financial] collapse may take it seems that the best bet is for it to occur close to the time that the Fifth NIGHT begins, in November 2007 [strictly speaking the 19th].”

This prediction was based on the fact that throughout cosmic history the fifth NIGHT has been a time when the old order often has come to be destroyed. Today, as economists agree that the global economic recession started in December of 2007, (see Fig. 2) we can in retrospect see how amazingly accurate predictions may be if they are based on the true Mayan calendar. Even if predictions from it are not cut in stone it will nonetheless tell us what time periods that are conducive to certain activities and frames of mind.

A second very important shift point came with the beginning of the sixth DAY – November 12, 2008 – when, with the election of Obama as president of the US a week earlier, an energy of rebirth can be said to have manifested. This is also what had been predicted to begin at that particular time, which is symbolized by Yohalticitl, the goddess of birth. Barack Obama notably happens to be born on the Mayan day-sign 9 Ben, which is identical to the birthday of the United States, July 4, 1776, and thus plays a significant role in the history of this particular nation, in that he thus creates a full circle. His intentions to rule with transparency and with a more friendly and egalitarian relationship to other nations is certainly a welcome contrast to several of his predecessors.

A sense of rebirth of ethical values has thus surrounded him creating an opening for a global unity on a larger scale. We may however notice that the economy did not turn up again as the sixth DAY began. Why this was so can be understood on different levels. One is the economic in that the means of continuing the economic growth through expanding credit probably now have been exhausted. Everyone who takes a loan knows that this means taking resources from the future and the limits to how far this can be pushed have now been reached. Another level of understanding is that of the cosmic plan where we are now in the Galactic Underworld, which does not have economic and technological development as its primary purpose.

On the contrary, the Galactic Underworld is about broadening the human horizon to a holistic viewpoint where we show concern for all of creation and the whole planet, which the world’s economic system has increasingly come in conflict with. We thus have reasons to seriously ask if the world will ever again experience a prolonged period of economic growth although the media keep talking about when the recession will end and the bankers and rulers of the world, Obama included, are taking measures that they say are to this effect. What is now being tried in order to reactivate the growth economy is then to give the bankers tax-payer money so that they can lend the same money back to the tax-payers that they got it from.

This may sound like a joke. Yet, the fact that so many have accepted this as necessary, and too complex for regular people to understand, shows how great the faith in the old ways still are. The reason the majority of people take it for granted that there will again be a period of economic growth some time in the future is that they were born into the Planetary Underworld. And indeed, if we study the wave movement of the Planetary Underworld that had the dominating effect on our consciousness between AD 1755 and AD 1999, we can see that economic growth periods alternated with recessions as a direct function of its shifts between DAYS and NIGHTS. DAYS meant upturns and NIGHTS downturns in the industrial economy. This very wave movement of the Planetary Underworld was however exactly what was transcended by the fifth NIGHT of the Galactic Underworld that began November 19, 2007. Will it then really in the current situation be possible for anyone to reactivate the growth economy? I personally do not think that this is the case except maybe for in limited sectors and to limited degrees. The decline will maybe slow down somewhat in this sixth DAY, but is likely to be intensified around the time the sixth NIGHT begins around November 7, 2009.

The purpose of the current Galactic Underworld is thus different from that of the Planetary and is primarily to introduce relationships in the world based on a holistic global and egalitarian mindset, manifested in balanced relations between genders, nations, races and religions across the planet (and actually across the universe, but we know little about this). If we like we may thus look upon the whole Bush era as blocking this consciousness from manifesting. Thus, while I feel that we are under the influence of the energies of the Mayan calendar (otherwise predictions would not have been possible) I also feel that our choices and the choices of different rulers influence how they manifest. Thus, certain policies of the Bush era might for instance have aggravated the situation. Regardless, I feel there is every reason to predict considerable hardships for many individuals who may lose their jobs, private economies and homes at the current time and the many, who in the time to come are likely to be faced with similar circumstances. An observer from a different planet may however look upon this also from a somewhat different perspective. He or she may look upon the end to the incessant growth economy as a sign that there is some hope that the planetary cancer is starting to recede and that there is some hope that humanity will actually survive and fulfill its purpose.

In such a perspective we may look upon it as if the cosmic plan has now set in a protective mechanism for the Earth, since one thing we can be certain of is that if the growth economy does not come to an end then the world will come to an end. No one may be able to tell whether this would happen because of global warming, depletion of life in the oceans, destruction of the rain forests, the disappearance of the bees or something else. In fact, we do not really need to know what would trigger such a collapse of the planetary ecosystem, since the point to realize is that none of these threats to our environment can be looked upon in isolation from the others. They all have a common origin in an economy that for a long time has been based on incessant growth and now the frame of consciousness carried by the Galactic Underworld is forcing us to face the consequences of this. I feel this means that in the years ahead we may expect to be faced with very difficult dilemmas on a personal level that usually do not have simple resolutions: “If I do not take care of myself, who will? Yet, if I do not care for the larger whole, who am I?” We may of course put the blame for the downturn of the economy on the bankers and others, who created the economy that led us to live off the resources of the future.

This however does not change very much, and it is also probably difficult to find someone who in one way or another did not to some extent benefit from this in a material sense. Thus, with few exceptions human beings have not voluntarily been willing to set an end to the growth. What then is there to do in this situation we may ask? If the economy will never start to grow again, what will emerge in its place? Many realize that what needs to happen is a transition to a sustainable economy, something that humanity has not experienced for some 5000 years. This would mean a return to a non-dualist Garden of Eden in balance with the environment at a new and higher level, a transition that many will probably find very difficult and almost incomprehensible to grasp mentally speaking. We may for instance take note of the fact that no world leader or economist is currently advocating a shift to an economy that is sustainable. So far, few have even started to consider that there will be no upturn in the economy, and when this starts to dawn on people we may in fact come to witness all kinds of actions of desperation and social unrest taking somewhat different forms in different cultures. Many hierarchical structures are likely to collapse. Will a sustainable economy then emerge? Well, there is no answer to this in the Mayan calendar, simply because it depends on the choices people will make in the time ahead and what they focus on creating. In the perspective of such a collective choice determining the future of humanity, it however seems plain silly when you hear people claim that the Mayan calendar predicts the end of the world from pole shifts, asteroids, natural disasters, sunspots or other physical events outside of ourselves.

The reality is that the Mayan calendar describes the evolution of consciousness and for the future does not predict anything except for what emanates, directly or indirectly, from the human beings themselves. Another way of saying the same thing is that there are no “consciousness shifts” happening on this planet outside of ourselves. The exact time of the downturn of the economy was predictable from the Mayan calendar for the very reason that this was a result of human behavior that is conditioned by the resonance with the Cosmic Tree of Life. The Cosmic Tree of Life, according to Mayan, and other ancient traditions is an unfathomably large intelligence, Hunab-Ku, at the center of the universe that makes quantum jumps at critical shift points in the calendar. The existence of such a central axis of the universe has recently (2003) been discovered by science, which I believe to be one of the most consequential discoveries of all time and elaborate on in the forthcoming The Purposeful Universe (Inner Traditions, December 2009). It is the energies emanating from this Cosmic Tree of Life that serve to synchronize evolution on all levels of the universe. It is through our own resonance with this, and with its quantum shifts, that we are inspired to create our world in accordance with the wave movements of seven DAYS and six NIGHTS in the cosmic plan.

From this perspective the talk of a predetermined “doomsday”, as presented by the History Channel or in upcoming Hollywood movies, simply seems absurd for anyone knowledgeable about the Mayan calendar. Such thinking merely serves to instill fear and to deflect our attention from the real issues at hand. Even if it may be true that the world may come to an end if we are not able to successfully transit to a sustainable economy, this would not be because of any preset “doomsday”. Such a disaster would instead be something that humanity has collectively (with some having greater responsibility than others) brought upon itself. If anything it would be caused by how we have ignored the message of the Mayan calendar, which is that we are meant to transit to a state of peace in oneness. Projections of fears or dreams onto a Y2K date in the future is a way of thinking that I believe is very disempowering and removes the responsibility for the course of events from our actions in the present moment. To avoid such projections I feel it is necessary to ground our intentions and actions in the changing energies of the Mayan calendar that we are living through in the present moment and look at what kind of intentions these may empower in us now. Our understanding of these may be based on parallels between different Underworlds such as the exact prediction of the time for the beginning of the economic decline.

This was based on the analogy with the year 1932, the beginning of the Fifth NIGHT of the Planetary Underworld, which meant the beginning of the Great Depression on a global scale. With the same reasoning of making parallels between different Underworlds we may now also look at our current situation as we approach the midpoint of the sixth DAY of the Galactic Underworld on May 11, 2009 (10 Ahau) and its continuation into its second half until November 7, 2009. The shift date is a parallel to the year 1962 (which was the midpoint of the sixth DAY of the Planetary Underworld) and the second half to the time period 1962-1972.
We may then want to recall what happened during this time period. 1962 was the year of the Cuban Missile Crisis, a shift point from which the Cold War would start to thaw and the year later the Beatles phenomenon exploded. I was privileged to be in England at the time and experience this first hand before it went on to most of Europe and later to the US. The point here is of course not to emphasize the musical phenomenon as such, but that this was the beginning of an intense wave of novelty that would create a tremendous cultural rebirth and social experimentation that in the years ahead would sweep the world from Mai 68 in France to Flower power, hippies and the peace movement in the US. This movement had distinct characters in different countries, and yet was very much globally synchronized in time.

It was carried by a desire to test new ways of being outside of the control of the “establishment” in every area of life and no authority was taken for granted. We may today look upon some its expressions as excesses, such as for instance the cultural revolution in China, but the fact remains that our current world still owes much of its egalitarianism and openness to what was created in this era. Needless to say, the world today is very different from 1962 and if nothing else it is dominated by another Underworld, where economic growth is constrained. Yet, it seems to me that this kind of an experimental attitude is exactly what is needed at the present time when a chief challenge is a grass roots creation of a sustainable economy. Any time of crisis fosters new creativity, which may take many forms of self-organizing collectives that escape the dominance of the ruling hierarchies. Moreover, if the downturn in the economy was predictable based on the Mayan calendar we have reasons to suspect that an intensified grass roots creativity will be supported by the Tree of Life in the time ahead. It has already become clear that in the current situation the old ways do not work for people in general and that something new will have to emerge. I feel if we do not understand this now, it will definitely be clear during the sixth NIGHT, November 7, 2009 to November 2, 2010, that the return to the growth economy is not possible.

For this reason we are inviting you to participate in a global meditation on May 9-11 to focus on the creation of a sustainable economy for the first time in 5000 years. This is an intention that millions of people share, but it is an altogether different matter to see it transcend the growth economy on a global scale. What we can do is in meditation to look at who we need to be for this to happen. I also believe that the increasing awareness of the Cosmic Tree of Life, currently shared only by a very small minority of the Earth’s population, will help to create the increased compassion that will be much needed as humanity seeks new ways of sharing resources, jobs etc. Thus a spirit of sharing, collaboration and compassion needs to color the global meditation at the midpoint of the Sixth DAY, May 9-11, 2009.

If the new ways do not embody such a compassion and collaboration they are simply likely to reproduce the old. A global meditation clearly does not by itself solve the problems of mankind. But it does help! By focusing on connecting with the Cosmic Tree of Life, which in Mayan and other ancient myths are behind the different eras humanity is living through, we may help create the necessary compassion to fulfill our own purpose as this attains its highest state on the energy of 13 Ahau on October 28, 2011. In a global meditation we may focus on inspiring the grass root creativity that will be needed to transit to a sustainable Garden of Eden that on my own part I am convinced is the purpose of the cosmic plan.

Carl Johan Calleman, Seattle, 9 Reed (April 14, 2009)

Rebirth Celebration Meditation Mayan Calendar

to be continued... - Apr 24,2009

Fri, 24 Apr 2009 04:43:55 GMT

    St. Michael:

          "....It is my duty to direct your attention to a coming chastisement. The various punishments allowed by God to come upon the U.S. continues to grow in proportion to the sins committed by this nation because of the immorality of its laws and the continued deceptive practices of your political leaders as much as the rest of the world. These sins are forcing the Hand of Divine Justice. Were there sufficient prayers being offered by the people of this nation, and if there were sufficient acts of atonement, these chastisements could be lessened. Because this is not so, and sin continues to grow with no concern to its indictment, the Eternal Father can only answer the calls for Justice.
      Few of the sincere and pious hearts offer reparation for offenses so easily committed against charity and morality. You proceed without a conscience. You give no heed to the warnings given throughout the world by the many voices of Heaven.
       It is obvious you do not listen to your own conscience as a nation. The strong continue to impose their wicked will upon the weak. Your souls have not been awakened by the chastisements that have continued to bring tears to the eyes of many. With cold hearts you continue to pursue your own lusts while you deny your duty of charity to those in need. It is only among those who have the least who continue to give the most that they can. And those who hold the strings of wealth continue oppress the weak by their greed. As thieves you continue to rob and steal from the coffers of trust; you continue to devise ways to compound the usury you charge in providing the basic resources in your charge as they are meant to be made available for the needs of all. For lack of charity and a lack of common decency, you leave many to starve for the benefit of your increasing wealth.

    The hypocrisy of the leaders of this nation and the world has grown to such an extreme that it reeks as a carcass decaying in the sun. So wretched is this stench, not even the vultures will venture close to make a claim to its remains. Still, you have no shame. Nor, do you have any fear...yet.
      For the time has come to cause you your greatest pain. And because of your sins, so many will suffer with you. This is the nature of evil. It brings its suffering upon the sinner who casts off his blame to rest upon the weakest. It is your famine that is coming......
      ...The many fires ignited by lightning have not moved your hearts, nor does the continued increase of severe tornadoes out of their normal season catch your attention. Your eyes are open only to your greed. You can see nothing else.
(Note: The seer says he knows that St. Michael is not speaking to the general public but is speaking to the many individuals who hold so much power and control of our country and the rest of the world. He is speaking to the general public in an effort to cause a reaction in the people. He wants people to recognize how a few people can call such terrible punishments to be brought upon the whole nation--even the whole world by their corruption, their unwillingness to defend or promote justice, and the failure to practice moral fortitude only cause the general public to accept these things as being a normal way of life. This type of environment calls souls slowly lose sight of righteousness. They lose moral appreciation and the strength to practice it. It is a combination of these factors that brings about the punishment upon all, from the strongest to the weakest.)
      You are not aware of how close so many countries are to complete financial collapse. Because of the evil deeds of so many in power, the financial system of many nations is crumbling, and this is the plan of the wicked. It is their design to cause hardship upon many. In this deed they have the design to reap even greater ill-gotten gain, squeezing from the purses of the weaker, every coin they can grab and they find themselves losing complete control. The chances of a financial collapse are imminent. It is coming. It cannot be prevented. It is only by prayer and great pleading from the depths of your hearts that this can be delayed. In the course of things as they are at this time, there is over a 75% certanty of a partial collapse of economics at the end of this year, most likely in the month of October, 2008. (This prophecy did come true and this message from St. Michael was given in June, 2008)
        This is another warning that few will heed. just as you have failed to listen to the voices of Heaven until now, by man's example, little is being expected by Heaven. Still, we pray for you. Still, we seek for pious souls with good hearts who are willing to mediate and intercede--for all of you. Heaven earnestly looks for a single soul that will love, where love is undeserved. It is there we make our abode guarding the hearts of the true children of God for mankind owes his thanks to these who have responded to the infinite love of the Twin Hearts, and much is owed to these souls who have held back the chastisements that are overdue.

to be continued......

St. Michael the Archangel | Lady of Light | mystics | messages

Pastor Harry Walther - Apr 09,2009

Thu, 09 Apr 2009 20:00:00 GMT

DOOMSDAY SCANERIO:... war explodes in the mideast after ISRAEL hits iran,,, terrorists detonate the DOME of the ROCK MOSQUE... social % financial collapse to the FIRST of TWO RAPTURES and the coming of ANtichrist= in his silver spaceship

Netanyahu vs Obama | watch & Be ready | Two Raptures | Church Vomit? | follow JESUS

Wild Wild Left Radio #12 - Mar 27,2009

Fri, 27 Mar 2009 22:00:00 GMT

Join us tonight for an unscripted version of WWL Radio, as I discuss in raw and brutal honesty the emotional fallout of living in these times with Ed Encho and Gottlieb. We want to hear your voices too. Have you become more jaded, more isolated, or more involved and connected? Has it brought a depression or a rage to your life to live in financial collapse, or endure certain job loss? Do you feel like going postal or going fetal?

Progressive | Liberal | WWL | Economic Emotional Fallout | Surviving Armegeddon

Financial Bankruptcy, the US Dollar and the Real Economy - Mar 26,2009

Thu, 26 Mar 2009 08:10:13 GMT

inancial Bankruptcy, the US Dollar and the Real Economy

Financial Bankruptcy, the US Dollar and the Real Economy

posted on 8:08 AM, August 26, 2007

Friday, August 24, 2007
par Rodrigue Tremblay

"The U.S. government is on a 'burning platform' of unsustainable policies and practices."
David Walker, U.S. Comptroller General

"Modern society, based as it is on the division of labor, can be preserved only under conditions of lasting peace."
Ludwig von Mises, Austrian economist

"People know that inflation erodes the real value of the government's debt and, therefore, that it is in the interest of the government to create some inflation."
Ben S. Bernanke, Fed Chairman

"Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again."
Ben S. Bernanke, Nov. 8, 2002 (Fed Chairman, talking to economist Milton Friedman)

Ordinary investors and people in general will have to get accustomed to hearing a lot about financial terms they never heard before, such as the subprime mortgage market, aggressive underwriting, asset securitization, repackaged loans, subprime loans, "no-doc" loans,
adjustable rate mortgage interest rate adjustment (ARM) loans, collateralized debt obligations (CDOs), asset backed securities, mortgage-backed securities, closed-end second-lien loans, subprime second-lien loans, alternative-A (Alt-A) mortgage loans, piggyback
loans, asset-backed commercial paper (ABCP),...etc.

—As a general definition, "subprime" or "high-risk" loans" are those made to people with poor credit and at lax conditions. Second-lien loans are loans that are placed in second place for any potential recovery after the primary lender on a property. —Residential mortgage-backed security (RMBS) are created when mortgage lenders sell their loans (and the risks associated with such loans) to banks, which package them together and slice them into different classes before selling them to (gullible) investors. This process, called "asset securitization" is the method whereby interests in mortgage loans and other receivables are packaged, underwritten, and sold in the form of "asset-backed securities". This is financial alchemy, through which subprime mortgage loans are transformed into AAA-rated paper for unsuspecting investors.

Some of these artificial or derivative securities are low-grade quality, and when their prices fall because borrowers cannot meet their interest or capital payments, such financial instruments become quickly "illiquid" or unsalable, since nobody wants to touch them. They become fictitious capital.

Those who hold them, investors, banks or other types of lenders, are stuck with them: they cannot sell them and they cannot borrow while placing such shaky assets as collateral. These are the imprudent lenders and investors that central banks now are trying to bail out.

During the French Revolution (1789-1799) the Jacobins (the Neocons of the day) had the brilliant idea of issuing securities, called "assignats", based on the properties (buildings and lands) the government had taken away from the Church and its religious orders. The new securities were quickly "monetized" into fiatmoney and transformed into readily available cash. This caused a massive hyperinflation and a subsequent deflation.

Mind you, this was not the first time that 18th-century France lived an experience of inflationary finance, since a similar incident took place three quarters of a century before, between 1716 and 1720, when Scottish banker and businessman John Law (1671-1729) led France into a fiat money fiasco and engineered a land-backed securities scheme known as the Mississippi Bubble.

John Law's earlier experiment and the French Revolution assignats debacle [http://www.mises.org/story/1504"
http://www.mises.org/story/1504] should be clear reminders of the danger and folly of "monetizing" illiquid assets-based securities.

Like all "Ponzi schemes", such pyramidings of debts with no liquid assets behind them are bound to implode sooner or later. And that is what we are witnessing today, i.e. the implosion of unfunded credit derivatives-based "Ponzi schemes". In 1998-2000, we got an idea of what could happen when portfolios are highly leveraged and laden with derivative financial products with the collapse of one large hedge fund, the Long-Term Capital Management.

This should have been a warning sign to regulators of financial markets. But hedge funds and other financial operators' greed—and political
corruption—were too strong, and no one stopped the march to disaster. Now, things are getting worse, because central banks, led by the Fed, are following the assignats route and have been aggressively
"monetizing" the unfunded derivative debts, lending new cash not for a day or two, and not against T-bills, but for months on end against illiquid and partly unsolvable and artificial derivative debts. Who
knows where this could lead?

One possibility is the complete collapse of the U.S. dollar and an uncontrollable burst of inflation in the years ahead if the salvaging operation were to increase money supply on a permanent basis. Indeed, if central banks continue to shore up the artificial financial houses of cards to prevent them from going bankrupt, they may end up
monetizing mountains of unsolvable debts with the potential of creating a monstrous inflation. A dollar panic may be just around the corner —Thus, the cure for fighting a credit crisis could be a tremendous
push of inflation in a few years, if the Fed cannot withdraw the new cash fast enough from the system.

This surely can be the case, since it has announced that it is discounting non-government home mortgages and mortgage-backed securities, jumbo mortgages, and asset-backed commercial paper, and a broad range of collateral for discount-window loans, besides the typical Treasury and government agency paper. The problem is that some of these so-called "securities" may be worthless in a few months, thus making it difficult for the Fed to sell them back and retrieve its cash.

Over the past few weeks, central banks worldwide have supplied hundreds of billions of fresh loans to banks and other financial dealers, to make cash available for lending and they have lowered interest rates amid signs that credit was drying up. The partly privately-owned Fed,
for example, has accepted billions in "repos", by which it bought billions in illiquid securities from dealers, who then deposited the money into commercial banks, thus "liquifying" the entire financial system. This is
a short-term measure designed to alleviate the "liquidity crisis", even if it is pursued for a few months.

It alleviates the "liquidity crisis", for sure, but this does nothing to cure the underlying "solvency crisis" of institutions holding large chunks of non-performing mortgage-based assets. Sooner or later, such low
valued derivatives will have to be written off, and this will necessarily lead to an erosion of these institutions' capital base. Bankruptcies of the most leveraged and imprudent institutions are to be expected. For a few weeks, the Fed's interventions and buying by the Treasury's special division, the "Working Group on Financial Markets", also commonly
known as the "Plunge Protection Team" (PPT) http://www.financialsense.com/fsu/editorials/dorsch/2007/0809.html] will sustain the financial markets. But come mid-September and early October, the law of gravity is likely to regain its importance.

As I explained in my blog of last October 16 (2006), (Headwinds for the US Economy), macroeconomic conditions made it a "matter of months,
not years", before the U.S. economy and the U.S. dollar begin to experience some downward pressures. And, as I repeated on May 5 (2007), (A Slowdown or a Recession in the U.S. in 2008?), we are "approaching [the] point of reckoning."

As I said in May, we could expect "the collapse of one and possibly several major financial institutions under the pressures of bad loans and record foreclosures. Particularly at risk is the some $2.5 trillion mountain of debt concentrated in subprimes and Alt-A loans. Already, one major sub-prime lender (New Century Financial) has filed for Chapter 11 bankruptcy protection. Others are likely to follow, because 2007 is the year when a large number of sub prime real estate loans
have to be renegotiated at higher interest rates. The rate of foreclosure is bound to spike in the coming months, possibly culminating in the next two years into a financial hurricane."

The practice of sub-prime loans and the creation of even more creative and artificial "derivative financial products" is much more widespread in the USA than in other countries. For example, such risky loans
represent as much as 20 percent of mortgage loans in the U.S., while the incidence is only 5 percent in neighbouring Canada. [Indeed, out of the U.S. $10 trillion mortgage market, about $2 trillion constitute the sub-prime mortgage market.] —But where were the American central bank, the Fed under Alan Greenspan and B. S. Bernanke, the Security and Exchange Commission (SEC) under former congressman and venture
capitalist Christopher Cox, and the Bush-Cheney Treasury Department when this mountain of shaky real estate debt was being built by unscrupulous and ruthless financial operators?

Why did they not intervene -first, to protect mortgage borrowers by putting a stop to mortgage loans that require no or not much documentation about a borrower's income (so-called "no doc" or "low doc" loans), -second, to prevent a solvency dilution of the capital base of American financial institutions and, -third, to prevent an unsustainable real estate bubble that sooner or later was going to burst and drag down
the rest of the economy? —It is indeed the duty of a lifeguard to prevent people from jumping into a swimming pool that is without water. —But when you have a Treasury Secretary who is a former president of
deal-making and hedge-funds-famous Goldman Sacks, a SEC chairman who is a former venture capitalist and a chairman of the Fed who is on record as saying he favours inflationary policies, you may have part of the answer. When the fox is put in charge of the chicken coop, you cannot expect the chickens to be safe. One has to remember that President Herbert Hoover’s Secretary of the Treasury, in 1929, was financier Andrew W. Mellon, with his far right economic policies of lowering taxes for the rich. We have the uneasy feeling that history repeats itself.

Since the Bush-Cheney White House wanted the economy to keep bubbling before the 2004 and 2006 elections, there was nobody to whistle the end of the recreation. As the French King Louis XIV
said, "Après moi, le déluge!" ("When I am gone, I don't care what happens!). In fact, U.S. regulators not only did not intervene to stop the madness of no-interest, no questions asked, no down payment loans, but they encourage unbridled speculation by abolishing the Roosevelt era crash-preventing "uptick rule" designed to force short sellers to wait for an uptick in the price of a stock before they could complete
their short trade. Indeed, it will be an historic irony that on July 6 (2007), the Security and Exchange Commission (SEC) removed the protection in order to allow hedge fund operatorsto short stocks on down ticks, thus making sure that market volatility would increase tremendously.

It is said that London financiers, greedy speculators and incompetent central bankers were responsible for the 1929-1939 worldwide financial crisis and economic depression. This came after a domino effect of financial collapses, starting with the failure in September 1931, of the big Austrian CreditAnstalt Bank, owned by the Rothschild family. The crisis spread throughout the German, the British and the global financial system. This time, the financial infection has started in the United States. If the current financial collapse in the U.S. were to stall the real
economy, as it has already begun to do in many sectors, the Bush-Cheney administration would have to carry a lot of blame because of its lax regulatory policies.

______________________________

_________

Rodrigue Tremblay is a Canadian economist who lives in Montreal; he can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it
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Author's Website: Check Dr. Tremblay's coming book "The Code for GlobalEthics" at: Posted, Friday August 24, 2007, at 5:30 am

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bye bye USA ?

Angry America Reviews Zeitgeist Video - Mar 22,2009

Sun, 22 Mar 2009 18:00:00 GMT

Join Angry America for our 12th Broadcast as we indulge the conspiracy theories mentioned on the Zeitgeist Video. The movie also provides an opportunity to test your critical thinking. Conversely, you may find yourself occasionally saying “wait a minute!” and questioning what you thought you knew. Hosted by Steve Shannon "the Cannon" & co-hosts Chris "do not fret" Fretwell and Rob Caster the "zen master".

Christianity is rehashed pagan sun-worship | 9/11 an elite conspiracy | Ultra-rich manufacture wars & financial collapses | Angry America | Job Horror Stories

Ron Paul calls for arrest of financial collapse culprits - Mar 13,2009

Fri, 13 Mar 2009 12:00:00 GMT

coverage of Ron Paul's call for arrest of financial collapse culprits, some details of the Canadian banking system, American-Chinese relations, and Chuck Norris' call for a plan to take back the U.S. government.

financial collapse | American-Chinese relations | Ron Paul | China | Chuck Norris

Wednesday Mystery - Feb 26,2009

Thu, 26 Feb 2009 04:00:00 GMT

Delusional music from the 'Roaring Twenties' and 'Dirty Thirties' news clips and audio blips and quips from the radical radio universe. In this episode the evening's "mystery" will be (from Vermont's Equal Time Radio notes): Is the present financial collapse a blip on the road to a high-tech future full of quantum computers, smart robots, and space tourism, or are we seeing the beginning of the collapse of the US empire, leading to shortages of basic goods, breakdown of government services, and

entertainment | progressive | left | cultural | music

Our Imminent Collapse - Feb 24,2009

Tue, 24 Feb 2009 00:30:00 GMT

Recently I highlighted a little known prophecy showing just how close we as a nation are to oblivion. It will happen suddenly, without warning to those who don't understand prophecy. Yet, I also show from other scriptures that the majority of people just don't want to hear it. Tune into this special show to discover what is about to happen in the near future, before it's too late!

prophecy | end times | financial collapse | collapse of USA | collapse of UK

Obama Sells U.S. to China Inc. - Feb 23,2009

Mon, 23 Feb 2009 15:46:29 GMT

If selling the soul of the US to China doesn't frighten you, it should. We already are into China for $500 million. Add to that this last $1.2 trillion in spending and the pending $1 trillion we better start learning Chinese. Did Obama say he was ashamed of americans not knowing a second language? Well english may just BE that second language!

The truth is starting to seep out. Because of the need for more money to finance the latest bailout―the Obama economic stimulus plan―America is going further in debt to the Chinese Communists. Our country is officially being sold to the highest bidder. And we have striking confirmation of this fact from Secretary of State Hillary Clinton.

The good news is that a correspondent for the mainstream media―Wyatt Andrews of CBS News―has figured this out and has managed to get on the air with his terrifying findings. Andrews’ report (http://www.cbsnews.com/video/watch/?id=4816957n%3fsource=search_video ) on the Friday CBS Evening News with Katie Couric was direct and to the point. Clinton is in China to beg for a handout.

“The truth is the Administration needs China’s help. America’s stimulus is very expensive and the U.S. wants China to help finance it,” Andrews reported. This is what America has become―a country that sends its Secretary of State abroad to beg for money from foreigners. In this case, it’s a communist dictatorship that forces women to have abortions, tortures Christians, and threatens the freedom and democratic government of Taiwan.

So the cost of the “stimulus” is more sacrifice of American independence and sovereignty, as well as our own values, ideals, and commitment to human freedom. It is a sad day both for America and China.

Clinton was shown saying, “We are relying on the Chinese government to continue to buy our debt.” The almighty dollar takes precedence over everything else, even as it falls in value and the dangers of hyperinflation and national bankruptcy loom. The tragedy is compounded by the fact that pandering to the Chinese will not solve anything. This policy, set in motion by big banks and corporations and pursued by Democratic and Republican Administrations, is what got us into this predicament in the first place.

Clinton’s comments, which concern the overall economic policy of the new administration, are far more significant than the Obama mortgage plan. Clinton is getting to the heart of the issue―how the mortgage plan and the stimulus are being financed.

White House spokesman Robert Gibbs expressed irritation last week that CNBC commentator Rick Santelli went into a rant over the prospect of forcing American taxpayers to underwrite the bad mortgages of deadbeats and others who are unable to pay their mortgages. But Santelli only touched on one small part of the problem.

Where’s the outrage over the pro-China policy that spans several administrations, and which has benefited his corporate bosses at General Electric, of permitting the communist dictatorship in Beijing to have the upper hand in global trade relations? All that Santelli has to do to understand this problem is attend a GE annual meeting and listen to the complaints of the GE workers losing their jobs to China. But don’t expect to see anything about that on CNBC, NBC, or MSNBC.

If you want more information on this travesty, please go to the website www.screwthatbulb.org ( http://www.screwthatbulb.org/ ) and learn how GE is going “green,” which has the effect of shipping American jobs to China. If Santelli did a rant about that, you can bet he wouldn’t be on the air again.

We were already in terrible shape under the Bush Administration because of a mysterious financial collapse apparently caused by illegal manipulation of our markets, but now the communists have us completely over a barrel because the Obama Administration, with the acquiescence of Congress, recklessly decided to spend even more money that we don’t have. Under the circumstances, this is criminal negligence.

Mrs. Clinton is officially stating what everyone should know is the truth. She deserves credit for being brutally honest. America has become a subsidiary of China Inc. In order for the U.S. to stay afloat, we have to depend on Beijing to finance a bailout. But the other major problem, of course, is that the stimulus is not a bailout in any real sense of the word. It depends on more government debt and borrowing at a huge cost of being more indebted to the Chinese. So the bailout is really digging our nation’s grave deeper.

To make matters even worse, as the Andrews report made clear, the cost will include the jobs that the Obama Administration says will be created by the stimulus. He interviewed an American manufacturer about the loss of American jobs caused by China’s trade practices, who said that the “cheating” in global trade has cost millions of American manufacturing jobs.

In the end, the only “jobs” that will be created or “saved,” as Obama likes to say, will likely be those benefiting from spending the federal money that the federal government doesn’t have. Most of them work for government at all levels.

Productive private sector manufacturing jobs will not be created―and cannot be―because despite their campaign promises, neither Obama nor Hillary will do anything about those unfair Chinese trade practices, such as the currency manipulation, that make Chinese goods artificially cheap and American goods more expensive.

The Andrews report, which caught me completely by surprise on a newscast that tends to portray the new Administration in completely flattering tones, was absolutely blistering in contrasting what Obama and Clinton had said during the campaign and what they are doing now.

“Both the man who became the President and his future Secretary of State told the voters they would make the [trade] cheating go away,” Andrews reported. He showed candidate Obama saying that he would do everything in his power to stop China from manipulating its currency and Hillary saying that she would “aggressively crack down on China’s unfair trade practices.” These claims were shown to be empty and abandoned campaign promises. We should have assumed that would be the case.
continue... http://www.aim.org/aim-column/obama-sells-u.s.-to-china-inc/

Soros sees no bottom for world financial "collapse - Feb 22,2009

Sun, 22 Feb 2009 09:16:34 GMT

NEW YORK (Reuters) - Renowned investor George Soros said on Friday the world financial system has effectively disintegrated, adding that there is yet no prospect of a near-term resolution to the crisis.

Soros said the turbulence is actually more severe than during the Great Depression, comparing the current situation to the demise of the Soviet Union.

He said the bankruptcy of Lehman Brothers in September marked a turning point in the functioning of the market system.

"We witnessed the collapse of the financial system," Soros said at a Columbia University dinner. "It was placed on life support, and it's still on life support. There's no sign that we are anywhere near a bottom."

His comments echoed those made earlier at the same conference by Paul Volcker, a former Federal Reserve chairman who is now a top adviser to President Barack Obama.

Volcker said industrial production around the world was declining even more rapidly than in the United States, which is itself under severe strain.

"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," Volcker said.

crash of USA?

FINANACIAL MELT DOWN PART 2 AND INFORMATIONES THAT YOU DO NOT WANT TO MISS IT? - Feb 21,2009

Sat, 21 Feb 2009 05:00:00 GMT

FINANCIAL COLLAPSE OF USA WAS STARTED SEPTEMBER 2008 CONTINUES TODAY WITH ANOTHER BIG FALL TODAY, WE WILL GO TO 4000- 5000 POINT SOON OR LATER, ARE YOU READY? YOU CAN CALL US AT THIRD HOUR 10-11PM 1-347-884-9191 PRESS 1 PACIFIC TIME.

MASSIVE FORCLOSURES | CREDIT CRISIS WILL TAKE US DOWN | OBAMA DID FINISH THE BUSH JOB ? | NEW MASTER IS LIKE OLD MASTER? | FORCLOSURE ALLEY AND 2012 PREDICTION

Obama paints a picture of economic catastrophe - Feb 11,2009

Wed, 11 Feb 2009 00:24:52 GMT

Addressing a national television audience in his first White House press conference, President Barack Obama, promoting his economic stimulus plan, used unprecedented language to characterize the deepening economic crisis. He described conditions of rapidly rising unemployment, growing demand at food banks, widespread foreclosures, the collapse of consumer spending and the failure of small businesses.

He declared that his administration "inherited the most profound economic emergency since the Great Depression," and warned that the lack of a federal government intervention "could turn a crisis into a catastrophe."

In response to the first question at the press conference, which suggested he was exaggerating the crisis, he observed, "This is not your ordinary, run-of-the-mill recession. We are going through the worst economic crisis since the Great Depression. We've lost now 3.6 million jobs. But what's perhaps even more disturbing is that almost half of that job loss has taken place over the last three months, which means that the problems are accelerating instead of getting better."

Obama nowhere attempted to explain the cause of the greatest world economic disaster in three quarters of a century. When another press questioner suggested that excessive consumer spending was a cause, he responded that it was not the fault of consumers, but of "banks taking exorbitant, wild risks with other people's money, based on shaky assets."

He drew no conclusions, however, from this admission—which directly contradicts his own assertion, in his January 20 inaugural address, that the American people as a whole are responsible for the financial crisis. His position could be summed up as: Capitalism has failed. Long live capitalism!

Obama declared that, like the Republicans, he supports the primacy of the "private sector"—i.e., the domination of the American and world economy by profit-making corporations. But the government had to intervene to "jump-start" the profit system, he argued.

"At this particular moment," Obama said in his opening remarks, "with the private sector so weakened by this recession, the federal government is the only entity left with the resources to jolt our economy back into life. It is only government that can break the vicious cycle where lost jobs lead to people spending less money, which leads to even more layoffs."

The actions proposed by the White House do nothing to address the causes of the financial collapse and little to relieve the mass suffering that Obama admitted exists in the United States. The scale of the stimulus bill, $820 billion, is dwarfed by the magnitude of the economic slump. Even if one accepts Obama's claim that the stimulus plan will create or save 4 million jobs over two years, the US economy is losing jobs at the rate of 600,000 a month—or 14 million over two years.

Only hours before the press conference, the Senate took a key step towards passage of a version of Obama's stimulus plan, voting by 61 to 36 to end debate and block a Republican filibuster. Both the Senate and House versions of the bill provide a tax cut worth about $500 a year to most workers, extend unemployment and health care benefits for those laid off, and give subsidies to state governments.

The Senate bill, the result of a compromise brokered by a handful of Republicans and right-wing Democrats, provides $40 billion less in federal aid to the states than the House bill and slashes nearly $20 billion in money for school construction and repair, while allocating $70 million more in tax cuts, mainly to upper-income families. Neither version covers massive state budget deficits that will result in tens of thousands of layoffs and drastic cuts in essential services.

Only a tiny fraction of either bill—some $40 billion out of $820 billion—goes to direct job creation through public works programs. The rest amounts to an effort to prevent a complete collapse of consumer spending and outright state bankruptcy as the economic slump worsens.

Obama made no reference to criticism of the stimulus plan as too small, instead focusing attention entirely on the opposition of congressional Republicans to any increase in federal spending to alleviate the conditions of working people.

After referring to his visit earlier in the day to address a town hall meeting in Elkhart, Indiana, an industrial town where unemployment has tripled in the past year, Obama said, "If there's anyone out there who still doesn't believe this constitutes a full-blown crisis, I suggest speaking to one of the millions of Americans whose lives have been turned upside down because they don't know where their next paycheck is coming from."

But nothing in Obama's program acknowledges or addresses the systemic origins of the crisis. He made passing references to the "failed policies of the past" and "tax cuts that are targeted to the wealthiest few Americans," and criticized those in Congress who opposed any stimulus package at all. But he made no proposal for any change in the structure of the financial system, and no reference to the role of private wealth accumulation in producing the disaster.

He was silent on the enormous growth of social inequality—the chasm between the super-rich and the great mass of the working population, which is wider than it has ever been in America. This social gulf is both a symptom of the financial disaster and the principal obstacle to any effort to resolve it, since any serious program to address the economic emergency involves making inroads into the property interests of the billionaires.

There is no doubt that the sober, even somber, tone Obama adopted in opening the press conference, and the dire picture he painted of the depth of the economic problems, owed something to his trip to Elkhart earlier in the day. There several thousand people, largely working-class, attended a town hall meeting.

The questions posed to Obama from the floor expressed a bitter class hostility towards the Wall Street "fat cats" who were identified as both the cause of the crisis and the prime beneficiaries of the series of bailouts backed by both Bush and Obama.

As a political representative of big business, Obama is capable of addressing working people only as victims of the financial catastrophe. He makes no appeal to the working class to take action to defend their jobs, homes and living standards.

On the contrary, one of his major concerns is to warn the ruling elite that the uncontrolled growth of mass suffering will have explosive political consequences

OBAM PROMISE WAS FAKE?

Weekly Address January 31, 2009 - Feb 08,2009

Sun, 08 Feb 2009 16:44:09 GMT

Remarks of President Barack Obama

Weekly Address
Saturday, January 31th, 2009

This morning I'd like to talk about some good news and some bad news as we confront our economic crisis.

The bad news is well known to Americans across our country as we continue to struggle through unprecedented economic turmoil. Yesterday we learned that our economy shrank by nearly 4 percent from October through December. That decline was the largest in over a quarter century, and it underscores the seriousness of the economic crisis that my administration found when we took office.

Already the slowdown has cost us tens of thousands of jobs in January alone. And the picture is likely to get worse before it gets better.

Make no mistake, these are not just numbers. Behind every statistic there's a story. Many Americans have seen their lives turned upside down. Families have been forced to make painful choices. Parents are struggling to pay the bills. Patients can't afford care. Students can't keep pace with tuition. And workers don't know whether their retirement will be dignified and secure.

The good news is that we are moving forward with a sense of urgency equal to the challenge. This week the House passed the American Recovery and Reinvestment Plan, which will save or create more than 3 million jobs over the next few years. It puts a tax cut into the pockets of working families, and places a down payment on America's future by investing in energy independence and education, affordable health care, and American infrastructure.

Now this recovery plan moves to the Senate. I will continue working with both parties so that the strongest possible bill gets to my desk. With the stakes so high we simply cannot afford the same old gridlock and partisan posturing in Washington. It's time to move in a new direction.

Americans know that our economic recovery will take years -- not months. But they will have little patience if we allow politics to get in the way of action, and our economy continues to slide. That's why I am calling on the Senate to pass this plan, so that we can put people back to work and begin the long, hard work of lifting our economy out of this crisis. No one bill, no matter how comprehensive, can cure what ails our economy. So just as we jumpstart job creation, we must also ensure that markets are stable, credit is flowing, and families can stay in their homes.

Last year Congress passed a plan to rescue the financial system. While the package helped avoid a financial collapse, many are frustrated by the results -- and rightfully so. Too often taxpayer dollars have been spent without transparency or accountability. Banks have been extended a hand, but homeowners, students, and small businesses that need loans have been left to fend on their own.

And adding to this outrage, we learned this week that even as they petitioned for taxpayer assistance, Wall Street firms shamefully paid out nearly $20 billion in bonuses for 2008. While I'm committed to doing what it takes to maintain the flow of credit, the American people will not excuse or tolerate such arrogance and greed. The road to recovery demands that we all act responsibly, from Main Street to Washington to Wall Street.

Soon my Treasury Secretary, Tim Geithner, will announce a new strategy for reviving our financial system that gets credit flowing to businesses and families. We'll help lower mortgage costs and extend loans to small businesses so they can create jobs. We'll ensure that CEOs are not draining funds that should be advancing our recovery. And we will insist on unprecedented transparency, rigorous oversight, and clear accountability -- so taxpayers know how their money is being spent and whether it is achieving results.

Rarely in history has our country faced economic problems as devastating as this crisis.

But the strength of the American people compels us to come together. The road ahead will be long, but I promise you that every day that I go to work in the Oval Office I carry with me your stories, and my administration is dedicated to alleviating your struggles and advancing your dreams. You are calling for action. Now is the time for those of us in Washington to live up to our responsibilities.

President Obama | Barack Obama | Inauguration | White House | Weekly Address

A New Year! A New You! A New Focus! - Jan 15,2009

Thu, 15 Jan 2009 18:04:20 GMT

At a time when the world is reeling from the worst financial collapse since the Great Depression, most people are experiencing an economic recession that will undoubtedly have an impact on their lives in 2009. Each day we hear about companies failing, industries needing government assistance, retailers struggling, increased joblessness, housing foreclosures, and more. Even more overwhelming and frustrating are our daily thoughts, feeling and activities that revolve around a busy schedule, a stressful job, a contract that ended unexpectedly or didn’t materialize, a ministry that is stalled, the rumors of job layoffs, an unfulfilled relationship, a pending divorce, an argument with a friend, a co-worker dispute, a parent-child disagreement, the memories of an unresolved past, a traffic jam, a medical condition, and/or a mountain of bills to contend with. All of which have the potential to stifle our desires and intentions to implement and/or sustain healthier lifestyle habits. So, how do you plan to address your desire to live healthier in the midst of a life full of hassles, demands, obligations, and uncertainty? Which lifestyle habits will you try to spend more time on? What will you decrease spending on to live healthier?

As you began to sift through those thoughts and feelings about how your life has been and will be impacted by the state of the world and your personal circumstances, and those actions you intend to modify in 2009, don’t put off evaluating those related to healthier lifestyle habits. It’s no secret that when you have so many feelings, thoughts, interests, and activities vying your attention, the idea of exercising or eating healthier will inevitably and continuously be placed on the back burner. There is never time enough time in the day to exercise or prepare a home cooked meal, get a sufficient amount of sleep, drink the appropriate levels of water, or get that much needed annual physical examination. Are you one of those people?

Now is the time for you to sit down at your kitchen table and focus on how you’re going to achieve the following three important tasks related to living healthier: (1) conduct a self-examination of those things that challenge you everyday, (2) develop a plan for how you’re going to align living healthier with your pursuits and challenges, and (3) implement your plan that will help to alleviate a continuum of poor lifestyle choices. The one thing you have to your advantage is the power of choice; taking responsibility for your actions and learning that your faith, determination, and perseverance are necessary for overcoming your challenges, rearranging your priorities, and embracing healthier lifestyle habits. One of the most important transactions you’ll make in 2009 will be to live healthier in the midst of it all.

This health and fitness dialogue is provided for your consideration only. It is not intended to replace the medical advice of your doctor or health care provider. Please consult your health care provider for advice about your specific health and fitness needs.

Fitness coach Bridgette Collins is the author of Imagine Living Healthier and Destined to Live Healthier, two entertaining and inspiring books that uses fictional stories to illuminate familiar patterns and truths about common lifestyle habits. For more information about Bridgette L. Collins (Coach Collins) and her books, go to http://www.BridgetteCollins.com.

Introduction: Silver Round Table - Jan 10,2009

Sat, 10 Jan 2009 20:00:00 GMT

New currency project.

monetary | currency | scrip | economics | financial collapse

IS OBAMA SAVE ALL WOLRD - Jan 09,2009

Fri, 09 Jan 2009 07:42:39 GMT

The financial crisis is deepening, with the risk of seriously disrupting the system of international payments.

This crisis is far more serious than the Great Depression. All major sectors of the global economy are affected. Recent reports suggest that the system of Letters of Credit as well as international shipping, which constitute the lifeline of the international trading system, are potentially in jeopardy.

The proposed bank "bailout" under the so-called Troubled Asset Relief Program (TARP) is not a "solution" to the crisis but the "cause" of further collapse.

The "bailout" contributes to a further process of destabilization of the financial architecture. It transfers large amounts of public money, at taxpayers expense, into the hands of private financiers. It leads to a spiraling public debt and an unprecedented centralization of banking power. Moreover, the bailout money is used by the financial giants to secure corporate acquisitions both in the financial sector and the real economy.

In turn, this unprecedented concentration of financial power spearheads entire sectors of industry and the services economy into bankruptcy, leading to the layoff of tens of thousands of workers.

The upper spheres of Wall Street overshadow the real economy. The accumulation of large amounts of money wealth by a handful of Wall Street conglomerates and their associated hedge funds is reinvested in the acquisition of real assets.

Paper wealth is transformed into the ownership and control of real productive assets, including industry, services, natural resources, infrastructure, etc.

Collapse of Consumer Demand

The real economy is in crisis. The resulting increase in unemployment is conducive to a dramatic decline in consumer spending which in turn backlashes on the levels of production of goods and services.

Exacerbated by neoliberal macro-economic policy, this downward spiral is cumulative, ultimately leading to an oversupply of commodities.

Business enterprises cannot sell their products, because workers have been laid off. Consumers, namely working people, have been deprived of the purchasing power required to fuel economic growth. With their meager earnings, they cannot afford to acquire the goods produced.

Overproduction Triggers a String of Bankruptcies

Inventories of unsold goods pile up. Eventually, production collapses; the supply of commodities declines through the closing down of production facilities, including manufacturing assembly plants.

In the process of plant closure, more workers become unemployed. Thousands of bankrupt firms are driven off the economic landscape, leading to a slump in production.

Mass poverty and a Worldwide decline in living standards is the result of low wages and mass unemployment. It is the outcome of a preexisting global cheap labor economy, largely characterized by low wage assembly plants in Third World countries.

The current crisis extends the geographic contours of the cheap labor economy, leading to the impoverishment of large sectors of the population in the so-called developed countries (including the middle classes).

In the US, Canada and Western Europe, the entire industrial sector is potentially in jeopardy.

We are dealing with a long-term process of economic and financial restructuring. In its earlier phase, starting in the 1980s during the Reagan Thatcher era, local and regional level enterprises, family farms and small businesses were displaced and destroyed. In turn, the merger and acquisition boom of the 1990s led to the concurrent consolidation of large corporate entities both in the real economy as well as in banking and financial services.

In recent developments, however, the concentration of bank power has been at the expense of big business.

What is distinct in this particular phase of the crisis, is the ability of the financial giants (through their overriding control over credit) not only to create havoc in the production of goods and services, but also to undermine and destroy large corporate entities of the real economy.

Bankruptcies are occurring in all major sectors of activity: Manufacturing, telecoms, consumer retail outlets, shopping malls, airlines, hotels and tourism, not to mention real estate and the construction industry, victims of the subprime mortgage meltdown.

General Motors has confirmed that "it could run out of cash within a few months, which could prompt one of the biggest bankruptcy filings in U.S. history". (USNews.com, November 11, 2008)) In turn this would backlash on a string of related industries. Estimates of job losses in the US auto industry range from 30,000 to as much as 100,000.(Ibid).

Collapse of General Motors Share Price

In the US, consumer retail companies are in difficulty: the share prices of JC Penney and Nordstrom department store chains have collapsed. Circuit City Stores Inc. filed for Chapter 11 protection. The shares of Best Buy, the electronics retail chain, have plunged.

The Vodafone Group PLC, the world's biggest mobile phone company not to mention InterContinental Hotels PLC are in difficulty, following the collapse of stock values. (AP, Nov 12, 2008). Worldwide, over two dozen airlines have gone under in 2008, adding to a string of airline bankruptcies in the course of the last five years. (Aviation and Aerospace News, 30 October 2008). Denmark's Second commercial airline Stirling has declared bankruptcy. In the US, a growing list of real estate companies have already filed for bankruptcy protection.

Vodophone. Collapse of Share Price

InterContinental Hotels PLC

In the last two months, there have been numerous plant closures across America leading to the permanent layoff of tens of thousands of workers. These closures have affected several key areas of economic activity including the pharmaceutical and chemical industries, the automobile industry and related sectors, the services economy, etc.

US factory orders have declined dramatically. Research firm Autodata reported in October that "sales of cars and light trucks in September had declined 27 percent compared with a year earlier."(Washington Post, October 3, 2008)

Unemployment

According to the US Bureau of Labor Statistics, an additional 240,000 jobs were lost during the month of October alone:

"Nonfarm payroll employment fell by 240,000 in October, and the unemployment rate rose from 6.1 to 6.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. October's drop in payroll employment followed declines of 127,000 in August and 284,000 in September, as revised. Employment has fallen by 1.2 million in the first 10 months of 2008; over half of the decrease has occurred in the past 3 months. In October, job losses continued in manufacturing, construction, and several service-providing industries...

Among the unemployed, the number of persons who lost their job and did not expect to be recalled to work rose by 615,000 to 4.4 million in October. Over the past 12 months, the size of this group has increased by 1.7 million." (Bureau of Labor Statistics, November, 2008)

The official figures do not describe the seriousness of the crisis and its devastating impact on the labor market, since many of the job losses are not reported.

The situation in the European Union is equally disturbing. A recent British report points to the potential plight of mass unemployment in North Eastern England. In Germany, a report published in October, suggests that 10-15% of all automotive jobs in Germany could be lost.

Job cuts have also been announced at General Motors and Nissan-Renault plants in Spain. Sales of new cars in Spain plummeted by 40 percent in October in relation to sales in the same month last year.

Workers of Nissan automaker protest in front of the Japanese company's building in Barcelona (AFP)

Bankruptcies and Foreclosures: A Money-spinning Operation for the Financial Giants

Among the companies on the verge of bankruptcy are some highly lucrative and profitable operations. The important question: who takes over the ownership of bankrupt giant industrial corporations?

Bankruptcies and foreclosures are a money-spinning operation. With the collapse in stock market values, listed companies experience a major collapse of the price of their stock, which immediately affects their creditworthiness and their ability to borrow and/ or to renegotiate debts ( which are based on the quoted value of their assets).

The institutional speculators, the hedge funds, et al have cashed in on their windfall loot.

They trigger the collapse of listed companies through short selling and other speculative operations. They then cash in on their large scale speculative gains.

According to a report in the Financial Times, there is evidence that the plunge of the US automobile industry was in part the result of manipulation: "General Motors and Ford lost 31 per cent to $3.01 and 10.9 per cent to $1.80 despite hopes that Washington may save the industry from the brink of collapse. The fall came after Deutsche Bank set a price target of zero on GM." (FT, November 14, 2008, emphasis added)

The financiers are on a shopping-spree. America's Forbes 400 billionaires are waiting in limbo.

Once they have consolidated their position in the banking industry, the financial giants including JP Morgan Chase, Bank of America, et al will use their windfall money gains and bailout money provided under TARP, to further extend their control over the real economy.

The next step consists in transforming liquid assets, namely money paper wealth, into the acquisition of real economy assets.

In this regard, Warren Buffett's Berkshire Hathaway Inc. is a major shareholder of General Motors. More recently, following the collapse in stock values in October and November, Buffett boosted his stake in oil producer ConocoPhillips, not to mention Eaton Corp, whose price on the NYSE tumbled by 62% in relation to its December 2007 high (Bloomberg).

The target of these acquisitions are the numerous highly productive industrial and services sector companies, which are on the verge of bankruptcy and/or whose stock values have collapsed.

The money managers are picking up the pieces.

Ownership of the Real Economy

As a result of these developments, which are directly related to the financial meltdown, the entire ownership structure of real economy assets is in turmoil.

Paper wealth accumulated through insider trading and stock market manipulation is used to acquire control over real economic assets, displacing the preexisting ownership structures.

What we are dealing with is an unsavory relationship between the real economy and the financial sector. The financial conglomerates do not produce commodities. They essentially make money through the conduct of financial transactions. They use the proceeds of these transactions to take over bona fide real economy corporations which produce goods and services for household consumption.

In a bitter twist, the new owners of industry are the institutional speculators and financial manipulators. They are becoming the new captains of industry, displacing not only the preexisting structures of ownership but also instating their cronies in the seats of corporate management.

No Reform Possible under the Washington-Wall Street Consensus

The November 15 G-20 Financial Summit in Washington upholds the Washington-Wall Street consensus.

While formally presenting a project to restore financial stability, in practice, the hegemony of Wall Street remains unscathed. The tendency is towards a unipolar monetary system dominated by the United States and upheld by US military superiority.

The architects of financial disaster under the 1999 Gramm-Leach-Bliley Financial Services Modernization Act (FSMA) have been entrusted with the task of mitigating the crisis, which they themselves created. They are the cause of financial collapse.

The G20 Financial Summit doesn't question the legitimacy of the hedge funds and the various instruments of derivative trade. The final Communiqué includes an imprecise and blurred commitment "to better regulate hedge funds and create more transparency in mortgage-related securities in a bid to halt a global economic slide."

A solution to this crisis can only be brought about through a process of "financial disarmament", which forcefully challenges the hegemony of the Wall Street financial institutions including their control over monetary policy. "Financial disarmament" would also require freezing the instruments of speculative trade, dismantling the hedge funds and democratizing monetary policy. The term "financial disarmament" was initially coined by John Maynard Keynes in the 1940s.

Obama Endorses Financial Deregulation

Barack Obama has embraced the Washington-Wall Street consensus. In a bitter twist, former Congressman Jim Leach, a Republican who sponsored the 1999 FSMA in the House of Representatives is now advising Obama on formulating a timely solution to the crisis.

Jim Leach

Jim Leach, Madeleine Albright and former Treasury Secretary Larry Summers, who also played a key role in pushing through the FSMA legislation, were in attendance at the November 15 G-20 Financial Summit, as part of President-elect Barack Obama's advisory team:

"President-elect Barack Obama and Vice President-elect Joe Biden announced that former Secretary of State Madeleine Albright and former Republican Congressman Jim Leach would be available to meet with delegations at the G-20 summit on their behalf. Leach and Albright are holding these unofficial meetings to seek input from visiting delegations on behalf of the president-elect and vice president-elect. (mlive.com, November 15, 2008)

BYE BYE USA AND WORLD? WORLD WAR 3 is coming?

The Fallen Natures of Men Took Control Of The Economy And Destroyed It - Dec 21,2008

Sun, 21 Dec 2008 04:56:19 GMT

some still wonder how it could have happened, we have a crony capitalist system, whole world now cutting back on spending, joblessness on the rise, banks now doing very little lending, a new head treasurer to choose, inequality in US cities may boil over, an impossible balancing act in the economy, an increase in the federal debt ceiling is also coming

Recently the fane-stream media was asking how our free enterprise system of capitalism could have failed us so utterly. How, they asked, could we have gotten into this disaster if bad investments were properly weeded out in a timely manner by the markets, and were not allowed to accumulate to such devastating levels of toxicity, as they should have been in such a system? These people are either morons, or liars, or both. This is not the failure of a free enterprise system of capitalism because our economy is no longer based on a free enterprise system of capitalism, and has not been for at least two decades. Any pretense of a free enterprise system of capitalism ended when, in the aftermath of the Stock Market Crash of 1987, which crash was orchestrated by the Illuminati during Paul Volcker's term at the helm of the Fed to provide the excuse needed, President Reagan signed an Executive Order forming the President's Working Group on Financial Markets, also known as the Plunge Protection Team, or PPT, which has, ever since, totally and completely dominated and manipulated virtually all markets worldwide on a 24/7 basis. The PPT's authority and mandate are illegally abused on a daily basis. This group of Illuminist players, which include Caligula, as President, Hanky Panky as Treasury Secretary, Buck-Busting Ben as Fed Chairman, and firms like Goldman Sachs as financial henchmen, are supposed to step in during a crisis. They are not supposed to be sticking their nose into everyone's business on a daily basis worldwide. We have become the envy of Russia and China, because Illuminist control over our markets exceeds their control over their command economies by an order of magnitude. We have perfected the corporatist, fascist business model via the Illuminati, who form our shadow government of puppet-masters. Russia and China are still amateurs. Everything that Russia and China have learned they have learned from us. That is because we helped to create them and make them what they are today. They are the best enemies that money can buy. After all, the Illuminati need various and numerous scapegoats on whom they can pin the blame for all the fallout caused by their malevolent, despicable and nefarious operations. They need victims to sacrifice on the alter of world government.

By using the Fed's repo pool to provide tens of billions of dollars to fund their operations whenever needed, the PPT once destroyed the ruble and the Russian economy, and has parked over two trillion dollars worth of latent US inflation, in the Chinese and Japanese economies alone, via treasury and agency debt purchased by these nations with their surplus trade dollars that they have gained through illegal currency manipulations that have been allowed, and even encouraged, until recently, by the PPT. The PPT has allowed them to artificially devalue their currencies to achieve unfair trade advantages so the Fed can hide the inflation it has caused through profligate growth of the money supply from the US sheople. The Chinese, Japanese and EU trade surpluses have also been created and fostered by the free trade, globalism, off-shoring, outsourcing, and both legal and illegal immigration agendas which have brought our auto industries to their knees and have sent our manufacturing industry and our good-paying jobs overseas. And soon that PPT-fostered dam of US debt is going to break along with all the other treasuries and agencies dammed up worldwide, thus totally Weimarizing us and destroying the dollar and its reserve status. Such an event is what will pave the way for a regional, and later a world, currency. That, in turn, is how the evil and despicable Illuminati will bring us into world government. They will control the world's supply of money, and thus they will be able to do as they please when it comes to political control, ala Rothschild: "Permit me to issue and control the money of a nation, and I care not who makes its laws." That line of reasoning can be extended from control of a nation's money supply, to control of the world's money supply, and thus leaders worldwide can be made into Illuminist puppets as has been done to most of the leaders of Western Civilization already.

A free enterprise system of capitalism also requires an underlying system of laws by which the game may be played fairly by all parties, and a legal system by which differences may be fairly adjudicated. Without a system of rules and proper enforcement devices, the fallen natures of men will take over and any sense of freedom and fairness in markets is thus lost. Our laws and judicial system have been completely and totally perverted because our politicians and judges, with few exceptions, are all bought-and-paid for or are compromised by the skeletons in their closets, which are usually large and numerous. The US Constitution is thus ignored, and is treated as if it were nothing but worthless piece of paper, like our fiat Federal Reserve notes. A cadre of malevolent elitists make all the rules, and then break them at will, holding only non-elitists accountable because they control the system of laws, and the system for enforcing those laws. That is not a basis upon which any free enterprise system of capitalism can be based. That is type of system that underlies crony capitalism and a corporatist, fascist police state, which is what we now have. So don't blame our current debacles on what started out as our free enterprise system of capitalism. That dream is long since gone, discarded on the scrap heap of history.

Benchmark borrowing costs have been coming down worldwide and as in Japan the world will be flooded with interest free money. Zero interest rates are on the horizon, which means we could be in for a protracted recession/depression, as Japan has experienced since 1992. What all these countries know is that Japan never was able to recover and stayed in depression for years. Had it not been for an undervalued currency and export markets left wide open to them in the US and then China, they would have collapsed long ago. Now that everyone is in the same recessionary boat those opportunities are only open to them in a limited way. Now every country in the world faces the same problem and the same results.

The world public is cutting back on spending and are now paying off debt and saving irrespective of the return on capital. The mindset has changed and could remain that way for years. It is called a race to zero rates.

Toward that end England just cut rates 1.5% to 3%, the biggest cut in 16 years and the ECB cut rates ½% to 3.25%. Reductions also took place in Denmark, the Czech republic and Switzerland. The Bank of Japan cut to 0.3%. It is its first cut in seven years to 0.2%. South Korea cut for the third time in a month. We see contraction in the world economy, probably to an overall growth rate of 2% in 2009. In the US, Western Europe and Japan we are looking for negative growth of 3% to 5%. Experts are predicting 3% inflation in Europe and the US. They obviously overlooked the massive amount of money and credit being created by central banks along with zero interest rates. The world economy hasn’t had negative growth since 1945, so you can see the world is in for a real wakeup call. It will be interesting to see if banks lend when rates approach zero. If they don’t you can expect mass nationalization. The current problem is that market rates are above where central banks have their rates and that isn’t going to change anytime soon. Eventually governments will have to guarantee all loans.

Credit standards for loans to companies and individuals have been tightening for 16 months and it is getting even tighter.

Millions of workers are losing their jobs worldwide as economies retrench. Joblessness is the highest in 14 years in the US.

As rates fall lenders are not passing on the savings to borrowers when they do lend.

Central banks are betting that negative real interest rates will induce people to spend rather than save money that is declining in value. What they are now facing is a full-blown recession. The mindset has changed. People are frightened and rightly so.

Thus, banks will loosen up and lend and some companies and people will borrow. That will delay the inevitable for 2 or 3 years. Then when all the cards are played we’ll enter depression.

Officially the economy lost 651,000 jobs in three months, unofficially the figure was more than double that. That is because our government lies about its statistics and counts part-time workers. These figures were accompanied by equally dreadful auto and retail sales. These kinds of figures should have shown up eight years ago, but they were delayed by the real estate bubble and the massive creation of money and credit. Now, in spite of a massive infusion of money and credit by central banks to banks, financial firms and some elitist transnational corporations, household, corporate and municipal borrowers have been frozen out, as have the leveraged speculation community. The Wild West atmosphere of Wall Street is over, but the massive damage it created will linger on for years. The criminally rated mortgage securitizations are finally dead forever.

First the Fed tried selective bailouts. Then they tried throwing money at banking, Wall Street and even general corporations. Thus far neither have worked, but they have kept deflation at bay. You have seen the hundreds of billions of dollars poured into our economy and foreign economies, but speculators and risk takers are still having to liquidate holdings and de-leverage, because lenders are cutting back loans, or just won’t lend. These actions by lenders has caused a $10 trillion collapse.

The bottom line is yes banks are doing very little lending, but the entire lending apparatus is not moving funds from one place to the other. This is called disintermediation. The market segments are close to frozen and there is no end in sight. In addition, there has been a loss of confidence in the derivatives market.

We believe the banks will lend within the next three to six months. We’ll then have a recovery in the economy, which will be short lived. That will bring temporary relief, monetize funds, increase inflation substantially and that will send gold and silver substantially higher.

Lawrence H. Summers was forced out of the Harvard presidency for formulating a personality cult, displaying supreme arrogance, being dismissive of most everyone and being biased against women. As Clinton’s Treasury Secretary he rejected warnings from Brooksley Born at that time head of the CFTC regarding the regulation of derivatives. Summers called her up and scrammed at Ms. Born, who resigned as a result and who has since proved to be correct, and Summers wrong. Summers is one nasty piece of work.

Others being considered for Treasury Secretary are former Fed Chairman Paul Volcker, who would be an excellent choice. The question is can he handle the job as he did 25 years ago. He is in his 80s. Another possibility is Timothy Geithner former head of the NY Fed, a protégé of Henry Kissinger.

Summers is calling for more economic stimulus packages - essentially give a-ways – that won’t work. They are stalling measures.

We see that sales of weapons have boomed over the last three months and particularly since the election. One large wholesaler sold 20,000 AR-15s in just several days.

Another factor generally overlooked is the growing inequality in US cities that could lead to widespread social unrest and a major increase in deaths. The cities most vulnerable are Washington, DC, Atlanta, New Orleans and Miami. This inequality has economic and political consequences that could well destabilize society.

The problem simply is that no matter what all central banks do they cannot stop or stave off financial collapse. No matter how much money and credit they create and how low they take interest rates, the world is facing a depression of epic proportions. The forced injection of liquidity into banking systems is severe and it can only become greater until the bubble breaks. There is now savings to build on and why would anyone save with almost zero interest rates? The only place your funds are safe is in gold and silver assets, there is nothing else. Every second that more money and credit is created your currency is worth less. A lower interest rate penalizes savers and producers. Low interest rates and major creation of money and credit eventually kill an economy. There is no incentive to save and produce.

Our new president will provide what is needed with the help of Congress during this process to create a welfare state, where the state will provide. That is not difficult when control of banking, Wall Street, money and a great part of major corporations are nationalized. Government will distribute and redistribute money and credit as the new one world government is created.

A reflection of dollar creation was that foreign official purchases of US Treasuries fell from $10.1 billion in July to $4.8 billion in August. Even Japan sold $7.5 billion worth.

It was 4 years ago we forecast $750 billion in homeowner losses. Now Bloomberg is talking about $855 billion. Where were they four years ago? Subscribers who wanted to sell should have done so 3 to 3-1/2 years ago. The Bloombergs of this world and the rest of the mainline media missed it all. And, that wasn’t coincidence, it was deliberate, the people who run things knew what was coming.

Yes, inflation has temporarily eased from 13-5/8% to 12-1/2%, but wait a few months. It will move back up again. Inflation isn’t going to slow down – how can it with the tremendous flow of liquidity. In the third quarter federal spending grew at 13.8% to help inflation along.

Considering all this Mr. Obama has promised us the process of redistributing income. He has said he will propose a tax on worldwide income of American multi-nationals who are hiding their wealth offshore at 35% the world’s second highest. He would institute a windfall profits tax on oil companies and would increase capital gains taxes to 20% next year. There is plenty of reason for the stock and bond markets to react in fear with the VIX at an all-time high of 89.5. The VIX is a contrarian indicator. When it is where it is today it is telling you the markets are headed down. Don’t get fooled by historic averages and declines. This bear market stands alone by itself as some thing very special. The Dow could easily fall over 70% this time from its high of 14,100 into the 3,800 to 4,200 zone. The 8 cartel banks cannot keep on engineering recovery rallies.

It is impossible to keep this balancing act going indefinitely. Home prices still have a long way to go on the downside and the correction will probably overshoot to the downside. This, of course, will add more and more foreclosures. In addition, the industrial sector is collapsing simultaneously. Factory activity has fallen 20% over the past two months, the lowest since 1982, and factory orders are the lowest since 1980. Vehicle sales have collapsed and that sector makes up 13% of America’s payroll. We are looking at prolonged stagnation and the demise of GM, Ford and Chrysler. What else could you expect of the American economy? Free trade, globalization, offshoring and outsourcing have stolen five million American jobs and it still continues to do so. The Fed and our banks along with Wall Street have destroyed our financial system, what else would you expect to happen? Just to show you the affect of all the US slowdown, Japan a big exporter to the US showed a 37.5 down from 45.4 in September, the lowest on record, after contracting for nine straight months. Toyota’s US sales fell 23% and Honda’s 26%. Not to be left out China’s manufacturing index is off to 45.2, the lowest level since its inception in June 2004. Manufacturing accounts for 42% of GDP. It is no wonder China is going to inject $586 billion into its economy. 67,000 Chinese factories have already been shut down in just the first half of the year. It looks like 100,000 will bite the dust by the end of the year.

London’s interest rates already at 3% are headed to 2% by February. That would be the lowest interest rate since 1694. Bank of England governor Mervyn King sees the economy entering waters that haven’t been seen since Charles Dickens. October house prices fell 2.2% mom, the 9th successive decline and off 15.75% yoy. In the last four months Brits saw homeowners with negative equity rise to 335,000 from 250,000. By 2010, one million could be in that boat. The UK has the same problem as the US, Spain and Ireland, plunging home prices and a credit crisis. Even though the pound has fallen 24% versus the dollar, their export orders fell to 43.5, the lowest since September 2001. When you see numbers like that you know imports and exports are freezing up. Now you can see why we again see war on the horizon.

The third quarter showed us that disposable income dropped at an 8.7% rate, the steepest on record dating from 1947. Consumer spending fell 3.1%, the first drop since the last quarter of 1991. Durable goods spending fell at the sharpest rate since 1991. Spending on non-durables fell at the sharpest rate since 1950. Wait until the 4th quarter figures are released in late January.

What is really disturbing is that credit default swaps in US Treasuries have risen almost 40% since the Fannie/Freddie bailouts. They are now equal to the debt of Thailand and Mexico. It shows you how out of control the Fed and the Treasury are. The big question is when will the foreigners finally see the light and stop buying dollars? It will happen, but we do not know when and neither does anyone else. The US Treasury says it needs $2 trillion this year, which means another increase in the federal debt ceiling.

collapse of usa economic is imminent? Euro=1.40 ag

Colossal Financial Collapse The Truth Behind The Citigroup Bank 'Nationalization - Nov 26,2008

Wed, 26 Nov 2008 17:18:17 GMT

On Friday November 21, the world came within a hair's breadth of the most colossal financial collapse in history according to bankers on the inside of events with whom we have contact. The trigger was the bank which only two years ago was America's largest, Citigroup. The size of the US Government de facto nationalization of the $2 trillion banking institution is an indication of shocks yet to come in other major US and perhaps European banks thought to be 'too big to fail.'

The clumsy way in which US Treasury Secretary Henry Paulson, himself not a banker but a Wall Street 'investment banker', whose experience has been in the quite different world of buying and selling stocks or bonds or underwriting and selling same, has handled the unfolding crisis has been worse than incompetent. It has made a grave situation into a globally alarming one.

'Spitting into the wind'

A case in point is the secretive manner in which Paulson has used the $700 billion in taxpayer funds voted him by a labile Congress in September. Early on, Paulson put $125 billion in the nine largest banks, including $10 billion for his old firm, Goldman Sachs. However, if we compare the value of the equity share that $125 billion bought with the market price of those banks' stock, US taxpayers have paid $125 billion for bank stock that a private investor could have bought for $62.5 billion, according to a detailed analysis from Ron W. Bloom, economist with the US United Steelworkers union, whose members as well as pension fund face devastating losses were GM to fail.

That means half of the public's money was a gift to Paulson's Wall Street cronies. Now, only weeks later, the Treasury is forced to intervene to de facto nationalize Citigroup. It won't be the last.

Paulson demanded, and got from a labile US Congress, Democrat as well as Republican, sole discretion over how and where he can invest the $700 billion, to date with no effective oversight. It amounts to the Treasury Secretary in effect 'spitting into the wind' in terms of resolving the fundamental crisis.

It should be clear to any serious analyst by now that the September decision by Paulson to defer to rigid financial ideology and let the fourth largest US investment bank, Lehman Brothers fail, was the proximate trigger for the present global crisis. Lehman Bros.' surprise collapse triggered the current global crisis of confidence. It was simply not clear to the rest of the banking world which US financial institution bank might be saved and which not, after the Government had earlier saved the far smaller Bear Stearns, while letting the larger, far more strategic Lehman Bros. fail.

Some Citigroup details

The most alarming aspect of the crisis is the fact that we are in an inter-regnum period when the next President has been elected but cannot act on the situation until after January 20, 2009 when he is sworn in.

Consider the details of the latest Citigroup government de facto nationalization (for ideological reasons Paulson and the Bush Administration hysterically avoid admitting they are in the process of nationalizing key banks). Citigroup has more than $2 trillion of assets, dwarfing companies such as American International Group Inc. that got some $150 billion in US taxpayer funds in the past two months. Ironically, only eight weeks before, the Government had designated Citigroup to take over the failing Wachovia Bank. Normally authorities have an ailing bank absorbed by a stronger one. In this instance the opposite seems to have been the case. Now it is clear that the Citigroup was in deeper trouble than Wachovia. In a matter of hours in the week before the US Government nationalization was announced, the stock value of Citibank plunged to $3.77 in New York, giving the company a market value of about $21 billion. The market value of Citigroup stock in December 2006 had been $247 billion. Two days before the bank nationalization the CEO, Vikram Pandit had announced a huge 52,000 job slashing plan. It did nothing to stop the slide.

The scale of the hidden losses of perhaps the twenty largest US banks is so enormous that if not before, the first Presidential decree of President Barack Obama will likely have to be declaration of a US 'Bank Holiday' and the full nationalization of the major banks, taking on the toxic assets and losses until the economy can again function with credit flowing to industry once more.



Citigroup and the government have identified a pool of about $306 billion in troubled assets. Citigroup will absorb the first $29 billion in losses. After that, remaining losses will be split between Citigroup and the government, with the bank absorbing 10% and the government absorbing 90%. The US Treasury Department will use its $700 billion TARP or Troubled Asset Recovery Program bailout fund, to assume up to $5 billion of losses. If necessary, the Government's Federal Deposit Insurance Corporation (FDIC) will bear the next $10 billion of losses. Beyond that, the Federal Reserve will guarantee any additional losses. The measures are without precedent in US financial history. It's by no means certain they will salvage the dollar system.

The situation is so intertwined, with six US major banks holding the vast bulk of worldwide financial derivatives exposure, that the failure of a single major US financial institution could result in losses to the OTC derivatives market of $300-$400 billion, a new IMF working paper finds. What's more, since such a failure would likely cause cascading failures of other institutions. Total global financial system losses could exceed another $1,500 billion according to an IMF study by Singh and Segoviano.

The madness over a Detroit GM rescue deal

The health of Citigroup is not the only gripping crisis that must be dealt with. At this point, political and ideological bickering in the US Congress has so far prevented a simple emergency $25 billion loan extension to General Motors and other of the US Big Three automakers-Ford and Chrysler. The absurd spectacle of US Congressmen attacking the chairmen of the Big Three for flying to the emergency Congressional hearings on a rescue loan in their private company jets while largely ignoring the issue of consequences to the economy of a GM failure underscores the utter lack of touch with reality that has overwhelmed Washington in recent years.

For GM to go into bankruptcy risks a disaster of colossal proportions. Although Lehman Bros., the biggest bankruptcy in US history, appears to have had an orderly settlement of its credit defaults swaps, the disruption occurred before-hand, as protection writers had to post additional collateral prior to settlement. That was a major factor in the dramatic global market selloff in October. GM is bigger by far, meaning bigger collateral damage, and this would take place when the financial system is even weaker than when Lehman failed.

In addition, a second, and potentially far more damaging issue, has been largely ignored. The advocates of letting GM go bankrupt argue that it can go into Chapter 11 just like other big companies that get themselves in trouble. That may not happen however, and a Chapter 7 or liquidation of GM that would then result would be a tectonic event.

The problem is that under Chapter 11 US law, it takes time for the company to get the protection of a bankruptcy court. Until that time, which may be weeks or months, the company would need urgently 'bridge financing' to continue operating. This is known as 'Debtor-in-Possession or DIP financing. DIP is essential for most Chapter 11 bankruptcies, as it takes time to get the plan of reorganization approved by creditors and the courts. Most companies, like GM today, go to bankruptcy court when they are at the end of their liquidity.

DIP is specifically for companies in, or on the verge of bankruptcy, and the debt is generally senior to other outstanding creditor claims. So it is actually very low risk, as the amount spent is usually not large, relatively speaking. But DIP lending is being severely curtailed right now, just when it is most needed, as healthier banks drastically cut loans in the severe credit crunch situation.

Without access to DIP bridge financing, GM would be forced into a partial, or even a full liquidation. The ramifications are horrendous. Aside from loss of 100,000 jobs at GM itself, GM is critical to keep many US auto suppliers in business. If GM failed soon most, possibly even all of the US and even foreign auto suppliers will go under. Those parts suppliers are important to other auto makers. Many foreign car factories would be forced to close due to loss of suppliers. Some analysts put 2009 job losses from a GM failure as high as 2.5 million jobs due to the follow-on effects. If the impact of that 2.5 million job loss is seen in terms of the overall losses to the economy of non-auto jobs such as services, home foreclosures caused and such, some estimate total impact would be more than 15 million jobs.

So far in the face of this staggering prospect, the members of the US Congress have chosen to focus on the fact the GM chief, Rick Wagoner, flew in his private company jet to Washington. The Congressional charade conjures up the image of Nero playing his fiddle as Rome goes up in flames. It should not be surprising that at the recent EU-Asian Summit in Beijing, Chinese officials mooted the idea of trading between the EU and Asian nations such as China in Euro, Renminbi, Yen or other national currencies other than the dollar. The Citigroup bailout and GM debacle has confirmed the death of the post-1944 Bretton Woods Dollar System.

The real truth behind Citigroup bailout

What neither Paulson nor anyone in Washington is willing to reveal is the real truth behind the Citigroup bailout. By his and the Republican Bush Administration's adamant earlier refusal to take an initial resolute action to immediately nationalize the nine or so largest troubled banks, he has created the present debacle. By refusing on ideological grounds to instead reorganize the banks' assets into some form of 'good bank' and 'bad bank,' similar to what the Government of Sweden did with what it called Securum, during its banking crisis in the early 1990's, Paulson and company have created a global financial structure on the brink.

A Securum or similar temporary nationalization would have allowed the healthy banks to continue lending to the real economy so the economy could continue operating, while the State merely sat on the undervalued real estate assets of the Swedish banks for some months until the recovering economy made the assets again marketable to the private sector. Instead, Paulson and his 'crony capitalists' in Washington have turned a bad situation into a globally catastrophic one.

His apparent realization of the error of his initial refusal to nationalize came too late. When Paulson reversed policy on September 19 and presented the nine largest banks with an ultimatum to accept partial Government equity ownership, abandoning his original bizarre plan to merely buy up the toxic waste asset-backed securities of the banks with his $700 billion TARP taxpayer money, he never revealed why.

Under the original Paulson Plan, as Dimitri B. Papadimitriou and L. Randall Wray of the Jerome Levy Institute at Bard College in New York point out, Paulson sought to create a situation in which the US 'Treasury would become an owner of troubled financial institutions in exchange for a capital injection-but without exercising any ownership rights, such as replacing the management that created the mess. The bailout would be used as an opportunity to consolidate control of the nation's financial system in the hands of a few large (Wall Street) banks, with government funds subsidizing purchases of troubled banks by "healthy" ones.'

Paulson soon realized the scale of crisis, largely triggered by his inept handling of the Lehman Brothers case, had created an impossible situation. Were Paulson to use the $700 billion to buy up toxic waste ABS assets from the select banks at today's market price, the $700 billion would be far too little to take an estimated $2 trillion ($2,000 billion) in Asset Backed Securities off the books of the banks.

The Levy Economics Institute economists state, 'It is probable that many and perhaps most financial institutions are insolvent today -- with a black hole of negative net worth that would swallow Paulson's entire $700 billion in one gulp.'

That reality is the real reason Paulson was forced to abandon his original 'crony bailout' TARP plan and opt to use some of his money to buy equity shares in the nine largest banks.

That scheme as well is 'dead on arrival' as the latest Citigroup nationalization scheme underscores. The dilemma Paulson has created with his inept handling of the crisis is simple: If the US Government paid the true value for these nearly worthless assets, the banks would have to write down huge losses, and, as Levy economists put it, 'announce to the world that they are insolvent.' On the other hand, if Paulson raised the toxic waste purchase price high enough to protect the banks from losses, $700 billion 'will buy only a tiny fraction of the 'troubled' assets.' That is what the latest nationalization of Citigroup is about.

It is only the beginning. The 2009 year will be one of titanic shocks and changes to the global order of a scale perhaps not experienced in the past five centuries. This is why we should speak of the end of the American Century and its Dollar System.

How destructive that process will be to the citizens of the United States who are the prime victims of Paulson's crony capitalists, as well as to the rest of the world depends now on the urgency and resoluteness with which heads of national Governments in Germany, the EU, China, Russia and the rest of the non-US world react. It is no time for ideological sentimentality and nostalgia of the postwar old order. That collapsed this past September along with Lehman Brothers and the Republican Presidency. Waiting for a 'miracle' from an Obama Presidency is no longer an option for the rest of the world.

WHY CITI BANK FIRED 53000 EMPLLOYEES?

"The Coming Tribulations" by Bud McFarlane, Sr., M.I. - Nov 23,2008

Sun, 23 Nov 2008 18:30:00 GMT

There are signs all around us that beg to take notice--the stakes continue to get higher as the world falls more rapidly into economic and moral decline. Wars and disasters threaten to add to the economic downturn and could easily turn what is now a lingering, world-wide recession into a full-blown depression and economic chaos. Worldwide famine will soon engulf us...bad news on the horizon yet God gives us hope...learn more...

Financial collapse | economic downturn | tribulations | hope

Stephen Harper Lays the Blame at George Bush's Feet - Nov 15,2008

Sat, 15 Nov 2008 19:45:15 GMT

Stephen "Yo Stevie" Harper, laid the blame for the current Financial Mess in the World, at George W. Bush's feet yesterday.

As all you intelligent readers know, the G-20 met for a Pow Wow to fix the world.

What freaks me out is, that the terrorists from September 11, 2001, wanted to destroy the American Economy.

It's been done for them.

From inside the country.

Pretty amazing if you ask me.

Pretty spooky.

Too scary.

Prime Minister Harper stated that the Financial Collapse is due to the non-regulated Banking System in the USA.

There ya have it.

Bull Markets, Bear Markets, Soothsayers, Hoo Doo Voo Doo, Unemployment, Lay Offis, GM, Chrysler, Christmas is coming, a Wal Mart Christmas?

According to Jim Cramer, that's what we are in for.

When Target is in trouble and the Rich stop buying, it's time to get out the worry beads.

Did you know the G-20 guests dined yesterday, on quail and bottles of $300 a bottle wine?

What me worry?

FDR had the New Deal.

Obama is getting a Raw Deal.

I don't envy the President Elect. It's hard to fix up someone elses Mess.

Wives do it in marriages every day, so do husbands.

Where to begin?

How bout on our knees? I'll start there.

In the words of Tiny Tim, God bless us, everyone.

We sure need it.

Stephen Harper | Banking | George Bush | Jim Cramer | Financial Mess | Chrysler | GM | Christmas

Credit Crisis Tentacles Spread to Every Sector of Finance Market - Nov 12,2008

Wed, 12 Nov 2008 22:53:28 GMT

Finally there is a 100% consensus between economists, experts, journalists, and government officials that restoring interbank lending will restore the stability of the financial system and will reignite economic growth. Too bad, the consensus has gotten again all wrong. This is a pure myth and nothing can be further from the truth.

The grim reality is very different and already forgotten. The reality is that most markets for the majority of financial instruments have collapsed completely and reviving interbank lending will not resurrect any of those markets. In other words, resolving the problem of interbank lending will not help the economy in any way. It is like an air balloon that has deflated and we desperately need to reflate it again with helium, but we are told that even ordinary cold air will lift it off the ground; since the balloon is stubbornly stuck on the ground, we are told we simply need more air!

We offer little new here, but a precious history of how the tentacles of the Credit Crisis are reaching more and more segments of the financial markets. No amount of interbank lending will recover meaningfully most segments from the firm grip of those tentacles.

The Causes of the Financial Crisis
We do not attempt to explain the fundamental causes of the current Credit Crisis. No doubt that in coming decades tomes will be written on the subject. Nevertheless, the basics are simple – America borrowed and spent for decades driving its savings rate to nil, while printing trillions of dollars in attempt to sustain the (unsustainable) global imbalances caused by its own profligacy and saddling the rest of the world with trillions of bad debt.

The Trigger of the Financial Crisis
The trigger of the crisis can be attributed to the decreased confidence in the markets for mortgage-backed securities following the August 2007 collapse of two Bear Stearns' hedge funds that were heavily exposed to subprime mortgages. Resetting of teaser rates and adjustable-rate mortgages triggered an avalanche of defaults. Once default rates started rising, many institutional investors, both U.S. and global, began to realize that the MBS's and CDO's in their portfolios might not be worth what they initially thought. Investment banks, insurance companies, mutual funds, and hedge funds alike began recognizing losses related to their holdings of mortgage-backed securities. Confidence was shaken. Margin calls forced further liquidations of those mortgage-backed securities, but as few were standing ready to buy, prices dropped even further, invoking even more margin calls. It was a death-spiral. The resulting losses just went snowballing. As a result, the markets for those structured financial products froze up and liquidity suddenly dried up. The Credit Crisis reared its ugly head.

1. Subprime Mortgages

The first indicator signaling the Subprime Meltdown surfaced in February 2007 “when scores of mortgage originators went bust amid rising defaults and tightening lending standards” . In mid-June, a second significant sign of financial collapse became evident as two CDO-focused Bear Stearns hedge funds blew up. Those hedge funds were too big and distracted investors' attention from another smaller in proportions, but still significant bankruptcy - California based brokerage firm Brookstreet Securities. This was the early beginning of the crisis.

In the second week of July 2007, Moody's and Standard & Poor's announced downgrades on billions of bonds backed by subprime mortgages. Though the downgrades did not reveal the unsoundness of the bonds, it signaled the demise of the Ponzi mortgage investment market backed by inflated real estate.

In early August the looming Credit Crunch could already be felt. Several of Wall Street's biggest foreign customers announced enormous losses on their holdings of mortgage backed securities. Once the “teaser rates” began to reset, mortgage defaults spiked. Foreign investors realized that the bond collateral fell short of the bond principal, in banker-speak, the LTV exceeded 100%. Home equity vanished and mortgage payments shot up. Dwindling foreign lending was a sure sign of the impending crisis.

At the end of August many financial institutions began to sense the looming disaster. Calls for various government bailout schemes for homeowners were only meant to bail the lenders out. Amidst the unraveling of the subprime crisis, the Fed responded by aggressively cutting interest rates. However, tightening lending standards, widening credit spreads, and rising down payments exacerbated default rates and mounted further losses for the Leveraged Speculator Community, aka, hedge funds. A common sense of mistrust gripped the markets. Confidence evaporated, and so did liquidity. The subprime market was terminally ill – no amount of Fed cutting and liquidity injections could ever possibly revive it again! This market has been dead for more than year.

2. Jumbo Mortgages

With the meltdown of subprime mortgages, the tentacles of the Credit Crunch began to take firm hold of other sectors of the financial system. The next victim was the market for jumbo mortgages – mortgages of high denominations, technically above $417,000 at the time. Further tightening of lending standards and more realistic perceptions of the underlying risk of those mortgages basically froze the market for Jumbo MBS. The major force behind the inflating California and Florida real estate bubbles was inanimate. Now these markets were set for a spectacular bust; the government's attempt to resurrect the Jumbo market (by raising the limit to $730,000) miserably failed. This market has been comatose for well over a year and jumbo rates remain stubbornly high. No amount of liquidity or interbank lending will revive the Jumbo market any time soon!

3. Home Equity loans

With dying subprime and jumbo markets and tightening mortgage credit, something that for decades was believed impossible, suddenly became inevitable -- real estate prices began to fall. As a result, the tentacles of the credit crisis snatched another victim -- Home Equity Loans and Home Equity Lines of Credit (HELOCs). These loans, commonly referred to as “second mortgages”, allow homeowners to borrow against the value of their home equity to finance a range of expenditures, such as medical bills, home improvements, college tuitions, and well-deserved vacations. The market quickly degenerated with rapidly deteriorating LTV ratios and skyrocketing number of “underwater” mortgages. Consumers fell behind on those loans at the highest level in 15 years. No more refis for consumers who already extracted the last drop of equity. With real estate prices falling, there was equity no more, With equity gone, so were the home equity loans. We can safely say that home equity loans are now a thing of the past and no amount of government stimulus and interbank lending will revive this market for many years!

4. SIVs and Conduits

Structured investment vehicles (SIVs) played a crucial role in the historic expansion of credit. A brainchild of ingenious financial engineers, large investment banks created and sponsored these entities. They invested largely in ABSs and MBSs that were manufactured primarily by the same large investment banks. To finance these investments, they issued investment-grade commercial paper and structured notes to investors around the world. This scheme allowed large financial institutions to remove a major portion of their risk exposure off their balance sheets, while at the same time “consolidating” any profits that resulted from the SIV operations. To put it in simple terms, they kept the profits on the balance sheet, but kept the risk off the balance sheet. This was the ultimate game in finance – return without risk, converting junk into AAA, turning led into gold – this was the Magic of Wall Street, the Alchemy of Finance.

However, with SIVs and Conduits loaded up with subprime, it was only a matter of time before this alchemic dream would turn into an ugly nightmare. Rising defaults and falling real estate prices shook investors' confidence. A series of downgrades inflicted grave damages. Some very risk-averse investors reaped distressing losses. Many risk-averse pension funds and university endowments relied on the AAA ratings and treated the securities as higher-yielding alternatives to safe money-market instruments. Repricing of ABS and MBS resulted in major writedowns for those SIVs and magnified the losses of their leveraged investors. Yet another victim fell into the tentacles of the Credit Crisis. As Doug Noland has pointed out so well, “the collapse of structured investment vehicles has proven to be the ultimate failure of Wall Street Finance in its attempt on risk intermediation between highly risky mortgage-backed securities and perceived safe and liquid money market instruments”. Today, it is accepted that Alchemy doesn't work, and that SIVs were hoped to do just that -- convert led into gold. The reality is that no amount of interbank lending and liquidity injections will do that.

5. CDOs

Some of the most pervasive exposures of leveraged financial institutions have been related to CDOs backed by subprime debt. This was another creature of mad financial engineers that was destined to fall in the tentacles of the Credit Crisis. It was meant to pool dodgy debt that with proper slicing and dicing would magically turn into a AAA-asset; it turned led into gold.

The bulk of the colossal losses of large investment banks, brokerage firms, hedge funds, and other financial institutions have been related to write-downs of CDOs. Their demand stalled as some top-rated classes of mortgage-linked CDOs lost their entire value amid surging foreclosures. Series of CDO downgrades by credit rating agencies led to enormous losses for investors around the world. Top-rated CDO tranches were devalued in late October 2007 due to expectations of excessive future losses from jumbo mortgages, Alt-As and option ARMs. Following the collapse of the two Bear Stearns hedge funds that were heavily invested in subprime CDOs, the CDO market has suffered severe illiquidity and lack of confidence. In late January Merrill Lynch CEO John Thain asserted that “[The company is] not going to be in the CDO and structured-credit types of businesses”. Since then the market has been for all practical purposes dead. It is dead because the underlying assets (jumbo, Alt-A, option ARMs) were never creditworthy in first place. No amount of liquidity injections and interbank lending will make the underlying instruments more creditworthy than before, and therefore cannot resurrect this financial instrument.

6. Commercial Paper

The familiar notion of borrowing short and lending long has come into question since the Credit Crisis began. Thousands of financial institutions have previously met their demise as a result of a maturity gap. Most of the companies engaged in this business were issuing commercial paper backed by MBSs or CDOs. With the unfolding of the crisis, questions about the value of the underlying collateral became ever more pervasive and eroded confidence. As a result, the market for commercial paper (CP) has fallen into the tentacles of the Credit Crisis. The first to experience the difficulties were the investment banks, then the commercial banks, and later other financial institutions. The difficulties spread even to the best investment-grade industrial corporations. As of April 11, 2008 total outstanding commercial paper has contracted by 11.4%. This market is not dead, but on life support, as the Fed has directly intervened to monetize commercial paper. Indeed, this market desperately needs the life support by the Fed in order to stay alive. By monetizing CP, the Fed has become the Lender of Last Resort for major corporations.

7. Private-Label MBS

The market for private-label MBS, which has been central to the creation of easily-available cheap credit, has suffered from a severe liquidity seizure, falling into the tentacles of the Financial Crisis. By securitizing mortgage loans, Wall Street was able to provide endless amounts of credit to homebuyers and homeowners, which led to the inflation of a real estate bubble of extreme proportions. Escalating home prices, in turn, made it possible for mortgage lenders to extend even more credit to borrowers with questionable credit history, without having to worry about being repaid, On the way up, it was a well-oiled Ponzi scheme; on the way down – an unmitigated disaster. The scheme depended crucially on rising real estate prices; once the prices stagnated or began to fall, no amount of liquidity injections or interbank lending could potentially revive this market.

8. Leveraged Loans

The loan market for Private Equity and Leveraged Buyouts (LBOs) is not functioning. Those loans that finance Private Equity deals or LBOs are known as “leveraged loans”. The tentacle of the credit crisis has gripped this market too. As the real economy has suffered a serious slowdown and plunges into a recession, the rate of corporate bankruptcies has been soaring. As a result, in October 2007 some of the major banks, such as Bank of America, Citigroup and JP Morgan, had to write down $2.5 Billion in loans for LBOs. These losses prompted most of the big players to slash their LBO loans. Some estimates indicate that only the very best deal can possibly get any financing; the volume has fallen almost 10 times. With an economy in recession, no amount of liquidity injections and interbank lending can revive this market.

9. Alt-A Mortgages

The Alt-A mortgage sector has not escaped the tentacles of the credit crisis. In a manner quite similar to Subprime and Jumbo mortgages, this market has slowed to a trickle. However, with the nationalization of the GSEs, the government is attempting to revive this market by forcing the GSEs to purchase more of these mortgages. As the GSEs themselves are now “owned” and guaranteed by the Treasury, this is tantamount to the Treasury buying up Alt-A mortgages. Given that the Treasury itself is financed mostly through monetization of the Fed, the ultimate effect is that this market is supported, just like the commercial paper market, with the printing press. The economic interpretation is that of a classic government subsidy financed by an inflation tax – redistributive, inefficient, and replete with moral hazards that sets up the system for a spectacular blowup down the road.

10. Prime Mortgages

The next victim in the tentacles of the Credit Crisis became the prime mortgages. Already in deep trouble, the financial system damaged even its healthiest credit market instrument. Reacting to the defaults in subprime and Alt-A mortgages, investors were compelled to manage risk more carefully. Practically, all sorts of loans became inaccessible for any borrower. This dried the liquidity, further causing huge bankruptcies of the borrowers who cannot refinance their loans. The prime residential mortgage market has been revived with the spectacular “bankruptcy” and subsequent nationalization of the GSEs, backed directly by the Treasury and indirectly by the Fed.

11. Commercial Mortgages

The commercial mortgage market has been practically frozen for many months. As the debacle in subprime, jumbo, Alt-A, and prime mortgages has unfolded, investors turned their attention to commercial mortgages. Over time, it became clear that investing in commercial mortgages is fraught with risk. The first obvious risk was overvaluation. The second obvious risk was a decelerating economy. The evolution of the Credit Crisis introduced a well-forgotten type of risk – liquidity risk. Investors saddled with heavy losses from other mortgage instruments decided to withdraw and stay on the sidelines. This, coupled with shaken confidence was enough to choke this market. Risk premiums have skyrocketed as the perceived risks of commercial mortgages have realigned with reality. Recession has exposed the fundamental weaknesses of many projects. The private sector wants none of this market. The Credit Crisis has extended its tentacles to commercial mortgages. No amount of liquidity injections and interbank lending can revive this market; only a direct intervention by the Treasury can do the trick.

12. Auction-Rate Securities

An auction-rate security is technically a debt instrument, typically a municipal bond, with a long nominal maturity, for which the interest rate is regularly reset through an auction, usually on a weekly basis. One economic interpretation of this concept is that of a fund borrowing with low short-term interest rates and lending to long-term municipal bonds, passing on the low interest rate to the municipal borrower. The other economic interpretation is that illiquid municipal bonds are securitized and transformed into liquid securities that are regularly traded at auctions.
As deleveraging tightened its vice grip on the credit market in February 2008, liquidity evaporated from the credit system and the auction-rate securities suddenly crashed out of the blue. It was another nail in the coffin of Wall Street Structured Finance and another victim in the tentacles of the Credit Crisis. This market has been dead for half a year and nothing short of extraordinary amount of liquidity coupled with government guarantees has the potential of reviving it.

13. Corporate Debt

The Credit Crisis has extended its tentacles to the corporate bond market. Credit spreads of investment-grade corporate bonds have been steadily rising and are much higher than even two months ago. Credit spreads for junk bonds have surged from 650 basis points at the end of September 2008 to 950 basis points at the beginning of November. Yes, credit is available to corporations, but the cost is becoming prohibitive. The tentacles have reached the corporate market and are beginning to strangulate it. Just like the market for auction-rate securities, this market desperately needs a torrent of liquidity to overcome the strangling tentacles. A Bloomberg story from October 31 tells the sorry tale of this market:
“Corporate debt markets in the U.S. and Europe endured their worst month as the credit crisis spread beyond financial firms to industrial companies amid the prospect of a global recession. Corporate industrial bonds in October are set to post their steepest monthly loss on record, while the gaps between yields on those bonds and government debt soar by the most ever.”

14. Credit Default Swaps

The US monolines are on the verge of bankruptcy as more and more of the credit that they insure defaults. They initially encountered difficulties in the beginning of January 2008. Indices of corporate credit risk widened, showing that the tentacles of Credit Crisis have reached the corporate bond market. The price of credit protection soared.

The monolines staggered because some major insurers were downgraded as investors questioned their ability to perform. Investors' minds were suddenly preoccupied with another well-forgotten risk – counterparty risk. A vicious spiral gripped the monolines -- CDSs lost their attractiveness, resulting in less cash inflows for monolines, which in turn decreased their ability to provide adequate credit risk insurance, lowering in turn their ability to sell CDSs… And another victim fell prey into the tentacles of the Credit Crisis.

The CDS market has not collapsed completely. However, its imminent collapse will indirectly affect international finance. Inability to hedge with CDS will eventually destabilize the US financial system. Many corporate borrowers will be unable to borrow, which in turn will result in higher corporate defaults, and another vicious cycles will inevitably take hold of the financial system.

15. Letters of Credit

The tentacles of the Credit Crisis have recently taken another victim: Letters of Credit. A Bloomberg story from October 29 explains this ugly turn for the worse: the Credit Crisis spreads beyond the financial sector and into the real economy. Do you remember the good old days when Bernanke and Paulson assured us that the Credit Crisis is contained? Here is the Bloomberg story:

“Richard Burnett's lumber company had started loading wood onto ships heading for China. More was en route to the docks. It was all part of an order that would fill 100 40-foot cargo containers. Then Burnett got a call from his buyer at Shanghai VIVA Wood Products Co. The deal was dead. He told Burnett… he couldn't get a letter of credit to guarantee payment for at least six months. ‘It was like a spigot got cut off,' Burnett said… The inability of buyers in China and Vietnam to get letters of credit has cost his company as much as $4 million this year, a third of projected revenue, forcing him to lay off 15 of 35 employees, he said. Suppliers of oil, coal, grains and consumer products from Chicago to Mumbai are losing sales as the credit crisis spreads beyond financial institutions, and banks refuse financing or increase the fees for buyers.”

16. Credit Card Loans

In October 2008 another market has fallen into the tentacles of the Credit Crisis: the market for credit card loans. Credit card companies usually do not retain most of their credit card debt on their balance sheet; instead, they securitize it and sell it. The latest data from Dealogic indicates that the consumer-based securitization market has shrunk in October to $500 million from $50 billion previously. This means that the ability to securitize and sell consumer-based loans has fallen almost 100 times in one year. The implication is clear – credit card companies will be forced to cut consumers from credit card debt. This will bring the American consumer to his knees and means the end of the Consumer Economy. No wonder that in the last three months the media frequency of the word “Depression” has increased hundred-fold.

Going Forward

No amount of interbank lending and liquidity injections will revive most of the markets for various financial instruments. No amount of monetary and fiscal policy can resurrect genuine productive lending in the economy. The tentacles of the Credit Crisis have spread to every sector of the financial markets. The “Real Estate Economy” is dead; the “Financial Economy” is dead; the “Consumer Economy” is dying; and the “Service Economy” is dying. Enter the Depression Economy! Or shall we say, “Enter the Zimbabwe Economy”!?

CREDIT CRISIS CONTINUES?

IN THE LONDON ? - Nov 12,2008

Wed, 12 Nov 2008 02:42:24 GMT

In a speech in London.” That’s how the BBC characterised Gordon Brown’s Mansion House Speech last night. Contrary to the BBC’s misrepresentation, this is not just another speech. It is at this event that Brown traditionally delivers his call to arms for the New World Order.

In last year’s speech, just prior to the financial collapse, he said, “… and I believe what will also be said of this age, the first decade of the 21st Century, that out of what will be seen as the greatest restructuring of the global economy, perhaps one even greater than at the time of the industrial revolution, a new world order was created …”

This year, apparently, following the election of Barak Obama, the time is now right to create a “truly global society” - a term he used several times during the speech. We should now “seize the moment” offered by the greatest restructuring of the global economy to forge a “new multilateralism.”

“Uniquely in this global age, it is now in our power to come together so that 2008 is remembered not just for the failure of a financial crash that engulfed the world but for the resilience and optimism with which we faced the storm, endured it and prevailed. And remembered too for how in doing so we discovered and refashioned the global power of nations working together.

“And having shown the power of coordinated global action to recapitalise our banks and cut interest rates for homeowners and businesses, this weekend in Washington we will seek to go further, launching the process of rebuilding the international financial system.

“So while I see a world that is facing financial crisis and still diminished by conflict and injustice I also see the chance to forge a new multilateralism that is both hard headed and progressive. And if we learn from our experience of turning unity of purpose into unity of action, we can together seize this moment of change in our world to create a truly global society.”

He went on … “As America stands at its own dawn of hope, so let that hope be fulfilled through a pact with the wider world to lead and shape the twenty first century as the century of a truly global society. And I believe the whole of Europe can work closely with America to meet the great challenges which will test our resolution and illuminate our convictions.”

Interesting that he uses the word “illuminate” here …

He also set out the five great challenges the New World Order world now faces:

the need to reassert faith in democracy and win the battle of ideas against terrorism and extremism

the need to strengthen the global economy

tackling “climate change”

resolving conflict - the need for a new “stabilisation and reconstruction agency” ready, through civilian as well as military assistance, to “rebuild” conflict-ridden and fragile states

meeting the Millennium Development Goals

He concluded with an appeal to world leaders, “My message is that we must be internationalist, not protectionist; interventionist not neutral; progressive not reactive; and forward looking, not frozen by events. We can seize the moment and in doing so build a truly global society.”

MR BROWN CALLS FOR NEW WORLD ORDER ?

Who is Behind the Financial Meltdown? Market Manipulation and the Institutional Speculator - Oct 27,2008

Mon, 27 Oct 2008 20:10:17 GMT

The market is heavily manipulated. The driving force behind the meltdown is speculative trade. The system of "private regulation" serves the interests of the speculators.

While most individual investors loose when the market falls, the institutional speculator makes money when there is a financial collapse.

In fact, triggering market collapse can be a very profitable undertaking.

There are indications that the Security Exchange Commission (SEC) regulators have created an environment which supports speculative transactions.

There are several instruments including futures, options, index funds, derivative securities, etc. used to make money when the stock market crumbles.

The more it falls, the greater the gains.

Those who make it fall are also speculating on its decline.

With foreknowledge and inside information, a collapse in market values constitutes a lucrative and money-spinning opportunity, for a select category of powerful speculators who have the ability to manipulate the market in the appropriate direction at the appropriate time.

Short Selling

One important instrument used by speculators to make money out of a financial meltdown is "short selling".

"Short selling" consists in selling large amounts of stocks which you do not possess and then buying them in the spot market once the price has collapsed, with a view to completing the transaction and cashing in on the profits.

The role of short selling in bringing down companies is well documented. The collapse of Lehman, Merrill Lynch and Bear Stearns was in part due to short selling.

Short selling has also been used extensively in currency markets. It was one of the main instruments used by speculators during the 1997 Asian Crisis to bring down the Thai baht, the Korean won and Indonesian rupiah.

Speculation in major currency markets also characterizes the ongoing financial crisis. There have been major swings in currency values with the Canadian dollar, for instance, loosing 10% of its value in the course of a few trading days.

Temporary Ban on Short Selling

Following the stock market meltdown on Black Monday September 15, the Security Exchange Commission (SEC) introduced a temporary ban on short selling. In a bitter irony, the SEC listed a number of companies which were "protected by regulators from short sellers". The SEC September 18 ban on short selling pertained largely to banks, insurance companies and other financial services companies.

The effect of being on a "protected list" was to no avail. It was tantamount to putting those listed companies on a "hit list". If the SEC had implemented a complete and permanent ban on short selling coupled with a freeze on all forms of speculative trade, including index funds and options, this would have contributed to reducing market volatility and dampening the meltdown.

The ban on short selling was applied with a view to establishing the protected list. It expired on Wednesday October 8 at midnight.

The following morning, Thursday 9th of October, when the market opened up, those companies on the "protected list" became "unprotected" and were the first target of the speculative onslaught, leading to a dramatic collapse on of the Dow Jones on Thursday 9th and Friday 10th.

The course of events was entirely predictable. The lifting of the ban on short selling contributed to accentuating the downfall in stock market values. The companies which were on the hit list were the first victims of the speculative onslaught.

The shares of Morgan Stanley dropped 26 percent on October 9th, upon the expiry of the short-selling ban and a further 25 percent the following day.

Financial warfare

There are indications that the downfall of Morgan Stanley was engineered by financial rivals. A day prior to the September 18th ban on short selling, Morgan Stanley was the object of rival speculative attacks:

John Mack, chief executive of Morgan Stanley, told employees in an internal memo Wednesday [September 17]: “What’s happening out there? It’s very clear to me – we’re in the midst of a market controlled by fear and rumours, and short sellers are driving our stock down.”' (Financial Times, September 17, 2008)

Morgan Stanley was also the object of doubts expressed by the ratings agency Moody's, which contributed to investors dumping Morgan Stanley stock.

Moody's cited an expectation that "an expected downturn in global capital market activity will reduce Morgan Stanley's revenue and profit potential in 2009, and perhaps beyond this period".

In contrast JP Morgan Chase, controlled by the Rockefeller family climbed by almost 12%.

The winners of financial warfare are JP Morgan Chase and Bank America. Both banking institutions have consolidated their control over the US banking landscape. They have used the financial crisis to displace and/or take over rival financial institutions.

The concentration of wealth and the centralization of financial power resulting from market manipulation is unprecedented.

Regulators Serve the Interests of Speculators

The SEC was fully aware that the ban on short selling would serve to exacerbate the downfall.

Why did they carry it out? How did they justify their decision? Who's interests are they serving?

In a twisted logic, the SEC, which largely serves the interests of institutional speculators, contends, quoting the results of an academic research paper, that short selling contributes to reducing market instability, thereby justifying the repeal of the September 18 short selling ban.

The Globalization of Poverty and the New World Order

by Michel Chossudovsky

In this new and expanded edition of Chossudovsky’s international best-seller, the author outlines the contours of a New World Order which feeds on human poverty and the destruction of the environment, generates social apartheid, encourages racism and ethnic strife and undermines the rights of women. The result as his detailed examples from all parts of the world show so convincingly, is a globalization of poverty.

This book is a skilful combination of lucid explanation and cogently argued critique of the fundamental directions in which our world is moving financially and economically.

In this new enlarged edition –which includes ten new chapters and a new introduction-- the author reviews the causes and consequences of famine in Sub-Saharan Africa, the dramatic meltdown of financial markets, the demise of State social programs and the devastation resulting from corporate downsizing and trade liberalisation.

Michel Chossudovsky is Professor of Economics at the University of Ottawa and Director of the Centre for Research on Globalization (CRG), which hosts the critically acclaimed website www.globalresearch.ca . He is a contributor to the Encyclopedia Britannica. His writings have been translated into more than 20 languages.

Published in 12 languages. More than 100,000 copies sold Worldwide.

MARKET MELTDOWN

FREEDOM OF INFORMATION - THE COMING FINANCIAL COLLAPSE PART 2 - Sep 30,2008

Tue, 30 Sep 2008 17:00:00 GMT

Dr. Lee Warren Joins us again to explain what is actually happening with the american finanical system. The mainstream is not giving you the full details of this crisis, and how the illumanti control federal reserve is taking over the government. What is the truth of this 700 billion bailout? This will be a live two hour call in show. Don't miss this one, it's very important. The number to call in is 914-338-0980

BIBLE | ISRAELITES | CONSPIRACIES | NWO | PROPHECY

THE NATION SPEAKS - A Conservative, Liberal, Moderate & One Black Man discuss & debate politics. - Sep 28,2008

Sun, 28 Sep 2008 00:30:00 GMT

The US Financial Collapse rocks Wall Street and Main Street. The Obama-McCain race suspends campaigning to address crisis. SCPECIAL GUEST - Leah Lane whose infamous Protester video has sparked outrage joins us to discuss her experiences at the hands of POLICE during the RNC. For more on her story including video, visit: http://www.radiofreenationblog.blogspot.com Join host Marty Owings as Mitch Berg, conservative from shotinthedark.info, Scotty from oneblackmansview.com and Doc Mo from the

Conservative | Liberal | Politics | Debate | Progressive |

FREEDOM OF INFORMATION - THE COMING FINANCIAL COLLAPSE - Aug 26,2008

Tue, 26 Aug 2008 17:00:00 GMT

Today's Guest will be Dr. Lee Warren, host of the tv show the power Laten in man. Dr. Lee will join us for the entire two hours, to discuss the coming world financial collapse. The financial system of the United States and the world is controlled by a high satanic elite known as the illumanti. High gas, a trillion dollar war, high food prices are only a few of the tools used to bring down the world monetary system. Join us for this very interesting topic. Call in number is 914-338-0980. S

BIBLE | ISRAELITES | CONSPIRACIES | NWO | PROPHECY |

What They Don't Tell You on the News - Apr 09,2008

Wed, 09 Apr 2008 03:30:00 GMT

Homosexual agenda forced on kindergartners, parents told to shut up, Alaska earthquake swarms presage more, IMF says financial implosion will reach at least $1 Trillion, contaminated pork, more

homosexual agenda | earthquakes | bad pork | financial collapse