Perspectives on the global economic meltdown

Singha · Post by **Singha** » 18 Jul 2009 09:03

brilliant and perceptive writing from george orwell.

the best writers are not just good craftsmen of words, they are superb students of human and social psychology.

vsudhir · Post by **vsudhir** » 18 Jul 2009 18:12

The US political system is showing resilient signs of breaking free of regulatory and/or state capture. Lets hope they are able to pull it off.

Lawmakers say Paulson bent to demands of bank CEO

Lawmakers accused former Treasury Secretary Henry Paulson on Thursday of bending to the demands of a major bank and keeping negotiations of a hefty bailout secret in his rush to stabilize financial markets last year.

{No prizes for guessing who this "major bank" supposedly is. Institutional capture accomplished onlee.}

Paulson, testifying for the first time since leaving office in January after putting in place a $700 billion bank bailout program, was defiant in his response and admitted no wrongdoing.

In one particularly testy exchange, Democratic Rep. Marcy Kaptur suggested that Paulson -- the former head of Goldman Sachs -- needed to visit her home state of Ohio to see how bad the economy really is.

"I know how terrible it is, I'm telling you it would have been worse" had the government not intervened, Paulson said. Kaptur, who voted against the bailout program, responded: "If that's your best argument, that's not good enough."

{Gutsy. Keep up the pressure. Transparency. Accountability. Follow the money trails. Who benefited most from taxpayer funded bailouts?}

Paulson acknowledged in his testimony that he pressured Bank of America CEO Kenneth Lewis to proceed with the deal despite Merrill's mounting financial losses. Paulson said he warned Lewis that Lewis might lose his job if he dropped the deal or tried to renegotiate because doing so would exhibit a "colossal lack of judgment."

{IOW, coercion. Admitted to in open congressional testimony. Wow.}

At one point during the discussions, Paulson pledged government aid to help Bank of America absorb some of the losses from acquiring Merrill. Paulson said he declined to put that promise in writing because the details would have been vague and would have had to be disclosed publicly by the Treasury Department.

Rep. Edolphus Towns of New York, the panel's Democratic chairman, said Paulson was all too willing to promise Lewis money after Lewis threatened to back out on the deal. "All of this happened against a backdrop of unchecked government power, with no transparency or accountability," Towns said.

Federal Reserve Chairman Ben Bernanke has denied threatening to oust Lewis and said he never told anyone else to, either. But another Fed official suggested otherwise in an e-mail obtained by the House panel.

Jeffrey Lacker, president of the Richmond Federal Reserve Bank, said in a December 2008 e-mail that Bernanke had planned to make "even more clear" that if Bank of America backed out on the deal, "management is gone."

Enough laws were broken and admitted to for indictments and prosecutions to begin. Grounds enough for future gutsy gubmint to take action. IMHO.

One blogger opines:

Threatening CEO Lewis is coercion, and pledging government aid to induce Lewis to go ahead with a deal Lewis knew was wrong is arguably bribery. Where are the indictments?

Bernanke is on the hook as well. Does anyone really believe Bernanke when he told Congress "He does not remember that part of the conversation with Mr. Lacker."

Here's the deal: People conveniently fail to remember things to prevent perjury.

vsudhir · Post by **vsudhir** » 18 Jul 2009 18:17

Ooh, more secrets tumbling outta closets onlee.

U.S. Regulators to BofA: Obey or Else

Bank of America Corp. is operating under a secret regulatory sanction that requires it to overhaul its board and address perceived problems with risk and liquidity management, according to people familiar with the situation.

Rarely disclosed publicly, the so-called memorandum of understanding gives banks a chance to work out their problems without the glare of outside attention. Financial institutions that fail to address deficiencies can be slapped with harsher penalties that include a publicly announced cease-and-desist order.

The order was imposed in early May, shortly after shareholders of the Charlotte, N.C., bank stripped Chief Executive Kenneth Lewis of his duties as chairman. Bank of America faces a series of deadlines, some at the end of July and others in August, these people said.

The MOU is the most serious procedural action taken against Bank of America by federal regulators since the financial crisis erupted.

Citigroup Inc. has been operating since last year under a similar order with the Office of the Comptroller of the Currency, according to people familiar with the matter. The company recently has been negotiating with the Federal Deposit Insurance Corp. about entering into a similar agreement with that agency, these people say.

Tensions between Bank of America and government officials have been building for several months, most notably a warning to Mr. Lewis by then-Treasury Secretary Henry Paulson that the bank's management could be pushed out if it abandoned the deal to acquire securities firm Merrill Lynch & Co., staggered at the time by massive losses.

In late January, the Federal Reserve and Office of the Comptroller of the Currency downgraded their overall ratings of the bank to "fair" from "satisfactory," according to people familiar with the matter. In a letter that was reviewed by The Wall Street Journal, the Fed criticized Bank of America's management and directors for being "overly optimistic" about risk and capital. The bank's capital position "was vulnerable" even before the Merrill deal, the Fed concluded, citing "acquisition activity" that included last year's takeover of mortgage lender Countrywide Financial Corp.

"Management has taken on significant risk, perhaps more than anticipated at the time the acquisition was proposed," a Fed official wrote in the letter, which accompanied the ratings downgrade and was sent days after the government agreed to $20 billion in aid to keep the Merrill deal on track. As a result, "more than normal supervisory attention will be required for the foreseeable future."

The MOU surprised some Bank of America executives who hadn't expected federal regulators to issue such a formal rebuke. The bank responded swiftly, with six directors resigning since May 26. The departures include O. Temple Sloan Jr., Bank of America's lead independent director, and Jackie Ward, chairman of the board's asset-quality committee.

Blogger Michael Shedlock's wishlist is clear:

The ultimate Irony for Lewis is that he broke the law to save his and the board's jobs by doing what Paulson asked. Then after the Merrill Lynch deal went through, the Fed and the Office of the Comptroller of the Currency rebuked Lewis and Bank of America for taking on too much risk!

This is hardball at its very finest.

I propose Bernanke, Lewis, and Paulson all share the same prison cell for the next 10 years or so. I will even throw in a ball and a bat so they can continue playing their games.

vsudhir · Post by **vsudhir** » 18 Jul 2009 18:33

Shux, the more you dig, the more the lunacy that surfaces.....taking on shades of CT now almost....

Converting to a bank-holding company has other benefits as well: Goldman's primary supervisor is now the New York Fed, whose chairman at the time of its announcement was Stephen Friedman, a former co-chairman of Goldman Sachs.

Friedman was technically in violation of Federal Reserve policy by remaining on the board of Goldman even as he was supposedly regulating the bank; in order to rectify the problem, he applied for, and got, a conflict-of-interest waiver from the government.

Friedman was also supposed to divest himself of his Goldman stock after Goldman became a bank-holding company, but thanks to the waiver, he was allowed to go out and buy 52,000 additional shares in his old bank, leaving him $3 million richer.

Friedman stepped down in May, but the man now in charge of supervising Goldman — New York Fed president William Dudley — is yet another former Goldmanite.

link

BTW, the current treasury secy, Sri Geithner, is also a former head of the NY Fed. And we thought only Bollywood was a closed family circle. One commentor opines:

They must also grant waivers for coercion, bribery, fraud, perjury, etc..

sathish_vaithilingam · Post by **sathish_vaithilingam** » 18 Jul 2009 19:13

Hello guys,

I am just new to this forum and i dont know what you guys are talking about. but, i am sure this is something to do with current world economic state. first of all, i would like to say this whole recession drama was engineering by the Federal Reserve which is solely owned by private bankers such as J.P. Morgan, Rothschild famil, David Rockfeller family and many more european inverstors. And, the US government and its political leaders are the puppet of this successful and pwerful private group. These elite bankers control the US govt. and infact they have cronies in all of the state departments of the past and present US govt. they have rights to legally print US dollars and control the value of dollar. So, the federal reserve is just as similar to federal express with the evil intention of bringing the entire world under one single umberalla of elite bankers and that is so called "New World Order". Now, you might think why i am saying all this to you. I am saying this to you becos i love my country "India". I dont want my country to fall prey for this evil monetary system projected by US as world econimic solution. I want everyone of you in this forum to watch this videos that says the truth behind Federal Reserve, US President and State sponsored financial terrorism

http://www.youtube.com/watch?v=_dmPchuXIXQ
http://www.youtube.com/watch?v=lBZne09G ... re=related
http://www.youtube.com/watch?v=SjUrib_G ... re=related
http://www.youtube.com/watch?v=_BVNN1wq ... re=related
http://www.youtube.com/watch?v=VPPFgHF9 ... re=related

Now, some of the information provided might not be entirely true but it is true that unites states of america has intentionally or unintentionally colloborated with axis of evil to enslave the entire world. you have the freedom to believe this story or dont beleive this story. But, remember throughtout the history of american politics, they have never allowed any country to replace their global power by exploiting their economic power . And, thats why i advise the government of india and the people of india to be aware of this consipiracy and let us not kill our our country and our childrens.

Jai Hind!
Sathish

SwamyG · Post by **SwamyG** » 18 Jul 2009 21:01

The financial meltdown is actually a commentary on us humans' priorities and values. I have argued once that the ultimate aim of any economic activity should be to benefit the humans. And we all seek happiness and prosperity. Now the definition and boundaries of those two words 'happiness' and 'prosperity' are going to differ across cultures and humans. In fact they vary over life time for us. And there is a price to achieve that. Finding the right balance is a key.

Elaine Supkis, a blogger I follow puts it thus:

And this is what we are for: we see the selling of children on reality TV, for example. By dishonoring the children and turning them into fountains of funds for parents via violating their innocence and privacy, we see children in shows like the infamous marital breakdown of the Jon and Kate business ripping apart their children’s mental health. The obnoxious invasion of privacy encouraged by both parents is what destroyed their marriage, in the first place. So the TV companies make oodles of money, selling this family’s agony.

In third world countries, they can’t sell big family woes in this fashion. So they sell their body parts to the West. Which is seeing a collapse of our own economic systems. The tussle over the Jackson children is just beginning. Everyone is using these poor creatures to get a slice of an economic pie which is growing due to hysteria over the death of a rather demented drug addict. The children have economic value so they will be ripped apart, put on public display by the winners who will hope to make a mint off of them and then the husks of these children will be cast aside. We see child performers being abused in this fashion, all the time.

SwamyG · Post by **SwamyG** » 18 Jul 2009 21:15

BTW, noises are being made about Citigroup entering bankruptcy. I had long long ago said to people outside BRF, the governments of the World instead of bailing out the banks could have given the money directly to the people. For example, in USA they could have sent a check to the individuals than to the banks and companies. My madrassa calcuation was like $300,000 to each individual or something. They would have paid some loans back, saved some monoey and put money to better use. But then nobody would have learned any lesson. On second thoughts nobody seem to be learning anything even now. Status Quo onlee. To me it is very simple (nothing really is simple) - The developed countries need to have a sustainable consumerism and lifestyle.

shravan · Post by **shravan** » 18 Jul 2009 23:54

House Panel Votes Huge $500 Billion Tax Increase; Networks Couldn't Care Less

The House Ways and Means committee approved a half-trillion dollar tax increase overnight, but the ABC and NBC morning news shows offered only a single sentence to the development, while CBS’s Early Show skipped it entirely.

Neither NBC’s Today nor ABC’s Good Morning America mentioned the tax increases $544 billion price tag, as each newscast folded the development into larger pieces on President Obama’s push for health care “reform.”

John Snow · Post by **John Snow** » 19 Jul 2009 00:00

No more melt down, evidence of OBAMA TARP is working great as new construction has picked up at a rapid pace according to orinthologists, here is the proff they say

Bob the Builder is busy.

Prospective buyer/broker

derkonig · Post by **derkonig** » 19 Jul 2009 00:33

^^^^

Bojitive neuj everywhere.....

Nandu · Post by **Nandu** » 19 Jul 2009 01:38

shravan wrote: the tax increases $544 billion price tag,

"Over ten years".
Why call it a half a trillion dollar price tag? While on the subject of hyperbole, why not extent it over the next century and call it a ten trillion dollar price tag?

vsudhir · Post by **vsudhir** » 19 Jul 2009 02:05

SwamyG,

Ambrose Evans Prichard (AEP), resident alarmist, at it again. What he outlines is sans IMF prescription though. Its mkt imposed discipline only.

Fiscal ruin of the Western world beckons

Again, like I said, the man is a known alarmist, take with some salt. But I wouldn't write him off entirely either. He's typically half right. Take your pick of which half you think will unfold eventually.

For a glimpse of what awaits Britain, Europe, and America as budget deficits spiral to war-time levels, look at what is happening to the Irish welfare state.

Read it all.

Added later:
AEP is quite specific (graphic?) about what exactly it is that is ailing the "modern western welfare state's survivability".

Events have already forced Premier Brian Cowen to carry out the harshest assault yet seen on the public services of a modern Western state. He has passed two emergency budgets to stop the deficit soaring to 15pc of GDP. They have not been enough. The expert An Bord Snip report said last week that Dublin must cut deeper, or risk a disastrous debt compound trap.

A further 17,000 state jobs must go (equal to 1.25m in the US), though unemployment is already 12pc and heading for 16pc next year.

Education must be cut 8pc. Scores of rural schools must close, and 6,900 teachers must go. "The attacks outlined in this report would represent an education disaster and light a short fuse on a social timebomb", said the Teachers Union of Ireland.

Nobody is spared. Social welfare payments must be cut 5pc, child benefit by 20pc. The Garda (police), already smarting from a 7pc pay cut, may have to buy their own uniforms. Hospital visits could cost £107 a day, etc, etc.

"Something has to give," said Professor Colm McCarthy, the report's author. "We're borrowing €400m (£345m) a week at a penalty interest."

No doubt Ireland has been the victim of a savagely tight monetary policy e_SEmD given its specific needs. But the deeper truth is that Britain, Spain, France, Germany, Italy, the US, and Japan are in varying states of fiscal ruin, and those tipping into demographic decline (unlike young Ireland) have an underlying cancer that is even more deadly. The West cannot support its gold-plated state structures from an aging workforce and depleted tax base.

Now, don;t get me wrong. The "western state" will survive. The welfare part won't. Welcome to the brave new (third) world existence.

Of course, tfta netas and their constituents will not go there willingly. They'll have to be dragged literally kicking and screaming into reality, gravity and all that. Consider the case of the country best poised to miraculously recover, regain lost ground and retake the glories of its rightful empire..../snark

As the International Monetary Fund made clear last week, Britain is lucky that markets have not yet imposed a "penalty interest" on British Gilts, given the trajectory of UK national debt – now vaulting towards 100pc of GDP – and the scandalous refusal of this Government to map out any path back to solvency.

"The UK has been getting the benefit of the doubt, both in the Government bond market and also the foreign exchange market. This benefit of the doubt is not going to last forever," said the Fund.

Can almost see IMF khanomists rubbing hands in glee waiting to sink their prescriptive meat hooks into UKstani welfare flab. And no, even for an intense admirer of UKstanism as moi, its an ugly sight.

BTW, Interesting to see what else the TFTA editors consider related articles.

Related Articles
*
Ireland imposes emergency cuts
*
Irish government to deliver emergency budget
*
Irish unemployment hits record levels
*
David Cameron promises Tories will not behave like 'turbo-charged accountants'
*
Britain's prized AAA rating under threat as S&P issues stark warning

vera_k · Post by **vera_k** » 19 Jul 2009 06:16

Updates from the Economist Intelligence Unit.

1. China GDP to grow at 7.8% or better rate this year.

2. US GDP to grow at 1.4% for 2010. This was revised upwards from 1%.

3. US to enter another recession in 2011 as the effects of the current stimulus peter out.

SwamyG · Post by **SwamyG** » 19 Jul 2009 07:12

Snow gaaru: What camera did you use for those pictures? They look awesome.

Paul · Post by **Paul** » 19 Jul 2009 07:28

RIO DE JANEIRO: It’s a shameless thing to do in an economic crisis.

Jobless people seeking information about their benefits on the Brazilian Labor Ministry’s Web were forced to type in passwords such as ‘bum’ and ‘shameless.’

Labor Minister Carlos Lupi is apologizing for the situation — and he blames a private company that created the site’s security system.

Lupi isn’t naming the company, but says its contract with the ministry wasn’t being renewed, which may have prompted the pranks.

The insults were discovered after an irate user wrote to the O Globo newspaper about it earlier this week.

The site was temporarily taken down. But by Friday it was up and running — without the insulting words. — AP

Singha · Post by **Singha** » 19 Jul 2009 12:14

afaik in UK is higher education almost 100% state funded in terms of tuition and living expenses even in oxbridge for british citizens?

people will need to pay more I am sure...

Tanaji · Post by **Tanaji** » 19 Jul 2009 14:39

Singha wrote:afaik in UK is higher education almost 100% state funded in terms of tuition and living expenses even in oxbridge for british citizens?

people will need to pay more I am sure...

No it is not, thats a misconception. There are different rates for citizens, but you still have to pay.

http://www.admin.ox.ac.uk/studentfundin ... ndex.shtml

http://www.admin.ox.ac.uk/studentfundin ... 10ug.shtml

Notice the massive difference between citizens and overseas students. As a note, Oxford in its poo-bahness strongly recommends that you do not work when you are student. It is not enforced, but they keep you pretty busy throughout such that working does make your grades suffer.

There is no subsidy for living costs.

Singha · Post by **Singha** » 19 Jul 2009 15:44

interesting. for a UG in Comp Sci the univ + college fees for a citizen works out to
only 5225 pounds per annum i.e 4.15 lakhs but overseas fees are 4X more.

how much would be books, food and rentals be for a student in a dorm or shared off-campus acco? if we wildly say $700/month total comes to around 5225+5136 = 10361 / annum.

over 4 yrs, 42000 pounds -> $68000

I thinks thats onlee half the cost of going to a good US public univ for a 4 yr degree. ivy league probably more.

thats the 'fat' the IMF needs to claw into ...

the british have been enjoying a 'strong' currency and cheap credit for 20+ yrs now. holidays on a whim to sunny climes in Med and Egypt, shop till you drop, alcohol flowing like water, sheltering criminals from all over, turning up their noses at 'old europe' etc etc.

hope there's some serious payback.

Neshant · Post by **Neshant** » 19 Jul 2009 17:16

Max Keiser on Goldman Sachs

http://zerohedge.blogspot.com/2009/07/m ... -scum.html

vsudhir · Post by **vsudhir** » 19 Jul 2009 21:54

California IOUs are creating an ersatz currency. They are now legal tender for Calfornia taxes.

California's budget gap won't close for long (Reuters)

Fri Jul 17, 2009 10:17am EDT

By Jim Christie - Analysis

SACRAMENTO, California (Reuters) - Even if California Governor Arnold Schwarzenegger and top lawmakers quickly plug a $26.3 billion deficit to balance the state's budget, the state's weak revenues signal that a new shortfall will emerge.

Schwarzenegger and lawmakers say they are near a deal to balance the budget, even though a hoped-for agreement did not emerge on Wednesday because of a part of his plan to suspend a law on school funding.

A balanced budget for the fiscal year that started July 1 would allow the state to resort to traditional borrowing, providing a steadier supply of cash at a better price than the unorthodox IOUs it has been forced to issue in order to conserve cash.

But a balanced budget is seen as fleeting because California's economy, which is reeling from high unemployment and the recession, will remain in the dumps for some time. Closing the current shortfall does not account for further deterioration in the economy -- and revenue -- that many economists expect.

"It will be horrible next year," said economist Steve Levy of the Center for the Continuing Study of the California Economy.

The UCLA Anderson Forecast unit last month said in a report that California's economy is in for a "continued rough ride for the balance of 2009 and is not going to see economic growth return until the end of the year." The unit also projected the state would suffer double-digit unemployment until 2011.

California's revenues from personal income tax collections, its main revenue source, are posting their worst decline since the Great Depression.

"By no stretch of the imagination is it done," said Christopher Thornberg, an economist at Beacon Economics in Los Angeles. "This isn't going away any time soon."

munna · Post by **munna** » 19 Jul 2009 22:12

Tanaji wrote:
Singha wrote:afaik in UK is higher education almost 100% state funded in terms of tuition and living expenses even in oxbridge for british citizens?

people will need to pay more I am sure...
No it is not, thats a misconception. There are different rates for citizens, but you still have to pay.

http://www.admin.ox.ac.uk/studentfundin ... ndex.shtml

http://www.admin.ox.ac.uk/studentfundin ... 10ug.shtml

Notice the massive difference between citizens and overseas students. As a note, Oxford in its poo-bahness strongly recommends that you do not work when you are student. It is not enforced, but they keep you pretty busy throughout such that working does make your grades suffer.

There is no subsidy for living costs.

Your tutors take it very bad if you are found doing some other odd job during Oxbridge but on the balance they give generous funding hence no need to work onlee

. But the 3X fee differential is big no no for some self funded students.

shravan · Post by **shravan** » 19 Jul 2009 23:38

Rep. Jim Jordan (R-Ohio) Questions Henry Paulson: Forcing Banks to take TARP money

Prem · Post by **Prem** » 20 Jul 2009 05:36

Can US now be called United States Of Goldman Sachs?

shyam · Post by **shyam** » 20 Jul 2009 06:47

SwamyG wrote:BTW, noises are being made about Citigroup entering bankruptcy.

Are you sure it is Citigroup? Or do you confuse that with CIT that is debating bankruptcy?

vsudhir · Post by **vsudhir** » 20 Jul 2009 06:56

This is serious.

Recall scenes from the great depression (GD I). The long lines of unemployed, the panic, fear, visible decay in living standards.

A big reason why this meltdown doesn't on the surface appear anything like the great depression of the 30s is that gubmint found ways to borrow, monetize, and mobilize funds directly into citizen's pockets - primarily via the unemployment benefits program. Now that appears to be running its course to exhaustion.

First wave of jobless exhaust unemployment benefits

Thousands of jobless Pennsylvanians are joining the growing ranks of people around the country who are exhausting unemployment benefits, as some experts worry about another blow to a stumbling economy.

Gov. Ed Rendell said 17,800 Pennsylvanians exhausted their jobless benefits in the week that ended Saturday, the first big wave of Pennsylvanians to do so. He urged legislators to pass a bill to extend the benefits.

Around the country, the number of people exhausting their benefits is piling up. By the end of September, more than 500,000 people will exhaust their benefits checks, with the biggest groups in Pennsylvania, California and Texas, according to estimates by the National Employment Law Project, an advocacy group for low-wage workers based in New York City. That number will nearly triple by the end of the year, the group said.

Pls recall that GOTUS has already extended unemp benefits twice already. A third extension might soon become necessary. All this even as jobless rolls swell to near-unprecedented levels with no relief in sight. Consider the case of NY.
Benefits Extended As State Unemployment Numbers Rise

The number of jobless New Yorkers across the state jumped significantly during the month of June, according to state Department of Labor statistics released Thursday.

The unemployment rate increased from 8.2 percent in May to 8.7 percent in June. That's the highest level since October of 1992.

In New York City, the rate increased from nine percent in May to 9.5 percent in June -- the highest level in more than a decade. That translates into more than 850,000 people out of work in the state.

"Because of our 8.7 percent unemployment rate, we will qualify for an additional seven weeks of unemployment insurance benefits," said New York State Labor Commissioner M. Patricia Smith. "So right now New Yorkers will be eligible for 79 weeks of unemployment insurance benefits."

Unemployment benefit extensions are expected to help an additional 47,000 jobless New Yorkers who would have lost their benefits in August.

If anyone is wondering abt Calif's unemployed, they're not alone.

Mighty soon the stuff will hit the fan. What then? IMO, protectionism is coming back bigger than before.

Singha · Post by **Singha** » 20 Jul 2009 07:15

khanate will have to deploy all these people into low end manufacturing me thinks and impose barriers to prevent goods from latin american and china underpricing them out.

shyam · Post by **shyam** » 20 Jul 2009 10:43

What do you think carbon tax is for?

abhischekcc · Post by **abhischekcc** » 20 Jul 2009 18:30

The high rate of employment is serious because then these people will take to crime. With millions of criminals roaming the streets with the 100s of millions of guns in the country with the "right to bear arms", it is a recipe for disaster that will make the French revolution seem tame. I guess the next country in which US forces will deploy will be US itself.

On a positive note: it will reduce demand for cocaine and Canadian weed.

shravan · Post by **shravan** » 20 Jul 2009 19:16

White House putting off release of budget update

WASHINGTON — The White House is being forced to acknowledge the wide gap between its once-upbeat predictions about the economy and today's bleak landscape.

The administration's annual midsummer budget update is sure to show higher deficits and unemployment and slower growth than projected in President Barack Obama's budget in February and update in May, and that could complicate his efforts to get his signature health care and global-warming proposals through Congress.

The release of the update — usually scheduled for mid-July — has been put off until the middle of next month, giving rise to speculation the White House is delaying the bad news at least until Congress leaves town on its August 7 summer recess.

The administration is pressing for votes before then on its $1 trillion health care initiative, which lawmakers are arguing over how to finance.

The White House budget director, Peter Orszag, said on Sunday that the administration believes the "chances are high" of getting a health care bill by then. But new analyses showing runaway costs are jeopardizing Senate passage.

"Instead of a dream, this routine report could be a nightmare," Tony Fratto, a former Treasury Department official and White House spokesman under President George W. Bush, said of the delayed budget update. "There are some things that can't be escaped."

The administration earlier this year predicted that unemployment would peak at about 9 percent without a big stimulus package and 8 percent with one. Congress did pass a $787 billion two-year stimulus measure, yet unemployment soared to 9.5 percent in June and appears headed for double digits.
.
.
White House putting off release of budget update

shravan · Post by **shravan** » 20 Jul 2009 19:18

RECOVERY.GOV - Stimulus Cheese - $5,708,260

What does the above mean ?

Nandu · Post by **Nandu** » 20 Jul 2009 20:40

shravan wrote:RECOVERY.GOV - Stimulus Cheese - $5,708,260

What does the above mean ?

If you need exact details, you will have to call DeptAg.

But the US agriculture department runs many food assistance programs (which, in turn, is also subsidy for farmers), so I am guessing they bought some cheese.

And, let us not forget Stimulus Pork.

vsudhir · Post by **vsudhir** » 21 Jul 2009 03:53

And it gets weirder and weirdewr. So much so that boor moi dunnos who to believe only anymore.

Inspector General: Treasury 'failed' to adopt bailout safeguards

OK. innocuous headline, what? Now, yeh chakho.

The government’s top watchdog over the $700 billion financial rescue package said the Treasury Department has "repeatedly failed" to adopt his recommendations that would make the program more transparent and accountable to taxpayers.

Neil Barofsky, the special inspector general over the Troubled Asset Relief Program (TARP), will tell lawmakers on Tuesday that taxpayers are being left in the dark about what banks are doing with bailout money, don't know the value of the government's investments and will not know the full extent of how the money is invested.

{Yawn yawn}

Barofsky said that while the TARP program that Congress passed amounts to $700 billion, the total federal government support since 2007 for the economy and the financial sector could reach a far higher figure of $23.7 trillion. The government has committed significantly more money through a variety of other federal agencies and programs.

While some steps have been taken, “it has repeatedly failed to adopt recommendations that [Barofsky] believes are essential to providing basic transparency …” Barofsky intends to tell lawmakers, according to prepared remarks obtained by The Hill.

OMG. Read that again. That ~ twice US GDP.

Meanwhile, Barofsky's office has opened 35 criminal and civil investigations into issues including suspected accounting fraud, securities fraud, insider trading, mortgage servicer misconduct, mortgage fraud, public corruption, false statements and taxes.

Bravo. It can only be the tip of the tip of the Aishberg.

Of course, true to form various wings, tentacles and arms of GOTUS have been hajaar helpful and forthcoming with info etc to aid in Sri Barofsky's heroic efforts:

"Treasury’s continued unwillingness to provide basic transparency despite the many recommendations of SIGTARP and Congress and the repeated demonstration that meaningful data from TARP recipients can be gathered and easily disseminated is unacceptable," said a memo prepared by Republicans on the oversight committee.

Well, well. Some things never change, do they. Even if the times they are a changin'? With due apols to Sri Bob Dylon.

Denninger puts it forcefully:

This is outrageous and threatens the very stability of our nation. How anyone can believe our banking system or indeed our nation's Treasury can survive the exposure of $24 trillion dollars, twice our GDP, is beyond me.

We most certainly cannot, and when (not if) our creditors and lenders, including China and Japan, wise up to what's going on here the game will quite literally be over, perhaps as soon as "right now."

A couple of market technicians have noted certain "patterns" in the market that have potential downside targets of zero. That sort of thing normally results in a loud guffaw from me - even though I'm bearish I'm not that bearish - I couldn't imagine anything short of global thermonuclear war, ala "Joshua", that could lead to such an outcome.

Well I think I just found something purely economic that could lead to that outcome, and its right here.

Congress is all we have left - they need to take control of this problem right here and now, revoke the authorization for this ersatz spending commitment immediately, and appoint a whole passel of special prosecutors to start issuing indictments to everyone involved in this outrage.

We need cops and we need 'em right now before our creditors decide to cut off our credit card and destroy this nation's economy and government - a decision that they could make literally at any time.

link

Read it all. And don;t forget to breath deeply.

vsudhir · Post by **vsudhir** » 21 Jul 2009 04:13

okie, more detail flooding in for that 24 TRILLION dollah story.

Found mention on PBS biz news for one.

"Costs include $2.3 trillion in programs offered by the Federal Deposit Insurance Corp., $7.4 trillion in TARP and other aid from the Treasury and $7.2 trillion in federal money for Fannie Mae, Freddie Mac, credit unions, Veterans Affairs and other federal programs, he said."

boomberg link

I'm like, wtf? Is somebody out to crash the already overstrained system? Whats with these drip drip drip of apocalyptic news, eh?

Meanwhile ancient khanomic wisdom resurfaces.....

"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." Ludwig von Mises

Satya_anveshi · Post by **Satya_anveshi** » 21 Jul 2009 04:40

Key to all this lies with Bush, Cheney, and even Paulson.

It is funny that people have put Obama on so much defensive that he is much hated for even saying that the crisis is all of Bush's making. The issues are so intervwined that it is so difficult to fix one and not the other. In a right wing radio talk (or rather trash talk), I heard that there are 130+ problems that Obama currently has on his agenda and all these problems need his urgent attention.

None in US is even contemplating on getting taking the above guys to task.

Take a look at this video: http://www.youtube.com/watch?v=4MH_oz9f1E4

Satya_anveshi · Post by **Satya_anveshi** » 21 Jul 2009 04:48

Afterall we need to know what is a meltdown meant to Henry Paulson

These are even better:

http://www.youtube.com/watch?v=135BcXx7G74&NR=1

http://www.youtube.com/watch?v=ro_PjGqy ... re=related

Guys a request: Can anyone please upload (or provide a link to) the whole Paulson testimony here? Thank you so much in advance. I think people who visit this thread, from around the world and not just folks in US, need to know that.

Added later: Here is the link to the entire Paulson testimony: http://www.c-span.org/Watch/Media/2009/ ... ulson.aspx

Satya_anveshi · Post by **Satya_anveshi** » 21 Jul 2009 06:23

This is Bush's speech on Sept 24, 08. You will notice the $hit was reading the whole script of the "meltdown" that was about to happen.

Within 2 weeks of this speech (Sept 25 to Oct 10), Dow fell from 11100+ to 8400 (~25%) with in a month after Dow hit 7550. (~33%)

Note the max drop of Dow after that was Dow at 6550 - 41% on Mar9th. Understanding this speech may help us understand the script.

http://www.youtube.com/watch?v=YsDmPEeurfA&feature=fvw

ramana · Post by **ramana** » 21 Jul 2009 06:44

What is the talk of second stimulus pkg? What do forex futures say about value of $ in coming 3, 6, 9 months?

vsudhir · Post by **vsudhir** » 21 Jul 2009 06:45

It is funny that people have put Obama on so much defensive that he is much hated for even saying that the crisis is all of Bush's making.

Each Prez has his own talents. GWB has a lot to be blamed for but Sri Obama after him hasn't exactly covered him self in glory either. Ulta, Sri Obama was gifted a grand opportunity to actually live his rhetoric of change and hope. And end the debt slavery at the heart of the US monetary system headed by the stakeholders of the Federal reserve.

Obama could have called the banks' bluff and nationalised them, replaced their managements, legislated a derivatves clearing house to take apart the complex web of systemic risk enveloping Wall st etc to start with.

Instead he quadruples the gargantuan budget deficit. Not a single special prosecuter appointed to investigate even one of the many banks and their CXO banking personalities who half-wittingly engineered the crash, not a single chargesheet filed, no attempt even at forcing accountability and transparency out of the Fed Reserve, none. So, yes, while I admit that Sri Obama is a much more compelling charmer than Sri GWB was, he's no Saint Obama or even FDR. Yet.

I would be wary of making this slow motion meltdown some partisan or personality issue.

vsudhir · Post by **vsudhir** » 21 Jul 2009 06:48

ramana wrote:What is the talk of second stimulus pkg? What do forex futures say about value of $ in coming 3, 6, 9 months?

The 2nd stimulus package is being pushed by acadhimmic charlatans who have quite eloquently covered their bases. It is right now in its 'trial balloon' stage. (Much like the trial balloons US inspired intellectuals keep pimping in south asia over cashmere).

As usual, there will be multiple voices speaking in slightly different directions to keep the issue vaguely in the media before it can be slipped in.

Compare that with the cap and trade bill which OTOH was slipped thru in an unseemly haste in the dark of the night at the opportune moment - M Jackson's death knowing the media will be busy there for a while.

vsudhir · Post by **vsudhir** » 21 Jul 2009 07:00

Pravda perspective. Take with requisite salt. Hilarious read, though.

First, the population was dumbed down through a politicized and substandard education system based on pop culture, rather then the classics. Americans know more about their favorite TV dramas then the drama in DC that directly affects their lives. They care more for their "right" to choke down a McDonalds burger or a BurgerKing burger than for their constitutional rights. Then they turn around and lecture us about our rights and about our "democracy". Pride blind the foolish.

Then their faith in God was destroyed, until their churches, all tens of thousands of different "branches and denominations" were for the most part little more then Sunday circuses and their televangelists and top protestant mega preachers were more then happy to sell out their souls and flocks to be on the "winning" side of one pseudo Marxist politician or another.

It must be said, that like the breaking of a great dam, the American decent into Marxism is happening with breath taking speed, against the back drop of a passive, hapless sheeple, excuse me dear reader, I meant people.

So it should be no surprise, that the American president has followed this up with a "bold" move of declaring that he and another group of unelected, chosen stooges will now redesign the entire automotive industry and will even be the guarantee of automobile policies. I am sure that if given the chance, they would happily try and redesign it for the whole of the world, too. Prime Minister Putin, less then two months ago, warned Obama and UK's Blair, not to follow the path to Marxism, it only leads to disaster. Apparently, even though we suffered 70 years of this Western sponsored horror show, we know nothing, as foolish, drunken Russians, so let our "wise" Anglo-Saxon fools find out the folly of their own pride.

{Huh. Really? wow.}

Again, the American public has taken this with barely a whimper...but a "freeman" whimper.

So, should it be any surprise to discover that the Democratically controlled Congress of America is working on passing a new regulation that would give the American Treasury department the power to set "fair" maximum salaries, evaluate performance and control how private companies give out pay raises and bonuses? Senator Barney Franks, a social pervert basking in his homosexuality (of course, amongst the modern, enlightened American societal norm, as well as that of the general West, homosexuality is not only not a looked down upon life choice, but is often praised as a virtue) and his Marxist enlightenment, has led this effort.

link