Posted on 02/02/2009 12:41:18 AM PST by Tempest
The basic story line so far is that we are all to blame, including homeowners who bit off more than they could chew, lenders who wrote absurd adjustable-rate mortgages, and greedy investment bankers.
Credit derivatives also figure heavily in the plot. Apologists say that these became so complicated that even Wall Street couldn't understand them and that they created "an unacceptable level of risk." Then these blowhards tell us that the bailout will pump hundreds of billions of dollars into the credit arteries and save the patient, which is the world's financial system. It will take time—maybe a year or so—but if everyone hangs in there, we'll be all right. No structural damage has been done, and all's well that ends well.
Sorry, but that's drivel. In fact, what we are living through is the worst financial scandal in history. It dwarfs 1929, Ponzi's scheme, Teapot Dome, the South Sea Bubble, tulip bulbs, you name it. Bernie Madoff? He's peanuts.
(Excerpt) Read more at villagevoice.com ...
Just curious.
“At least we have a bright new president. He’ll give you a job painting a bridge.”
“I hope that was an attempt at sarcasm.”
So, if no one else will give me a job, or no one will lend me money to start my own business and I can get a job painting a bridge, which will provide me with income to take care of my family, I shouldn’t take it... .why?
The recession is NOT the problem. It is the solution.
This is what I read brought it to a head.....AIG was downgraded.
1. Stop trusting government to protect you. Government helps the rich and politically connected. Check your history books.
2. Explain this publicly to as many of your friends and family as you can. Repeat often.
3. Get government out of the markets and don't trust stockbrokers - they are salesmen, not financial advisers. They like your government, have no fiduciary duty to you.
This is what I we should do about the stimulus.
Tomorrow night at 7:00pm we all turn on our TV. Across the screen will be every piece of legislation dealing with the stimulus. For each item, we get to press 1 on our phone to keep it in the plan and press 2 to kill it.
Each party will pick 1 representative to interpret the bill.
So for the left, it would be Chuck Schumer. For the right it would be Rush Limbaugh.
Topic. Funding for the Arts.
Schumer: This would enable minorities and the poor to share in the joys of culture from around the world.
Rush: No jobs are produced from this. It costs 200 million dollars and the only one who benefits is some Democrats wife.
Vote.
And on and on and on.
It’s always a Bush’s fault. I thought the MSM had made that perfectly clear ;o)
2. Explain this publicly to as many of your friends and family as you can. Repeat often.
3. Get government out of the markets and don't trust stockbrokers - they are salesmen, not financial advisers. They like your government, have no fiduciary duty to you.
Very good advice, my Grandfather told me something very similar way back when and it really saved my during the past few months. Although, many very good people just do not understand this and have and will pay dearly.
If you read the article. You see that Hedge funds, derivatives etc. were developed to remove risk so investors could hedge their bets...and win no matter what-good market or bad market. Since true free market always involves risk...which keeps investors from making truly stupid investments this perceived lack of risk allowed banks to leverage 60-1 and and make all those bad loans we keep hearing about among other seriously bad investments. You can not have a free market without risk...risk was removed from the equation; thus, I can say unequivocally, this was not free market and has damaged our economy, our nation and the world.
This in not a new scheme, the bucket law, was enacted in the early 20th century to prevent the low tech equivalent of hedging your bets- IE market manipulation. Unfortunately, this law was repealed by Congress so the traders perfected their now high tech manipulation of the free market and managed to hide their criminal behavior...removing risk to them, but increasing risk to the economy...they are absolutely despicable and should be jailed. How can a free market exist which bad actors like these guys and a corrupt government?
LOL! If you go down to the port you can see them loading all those jobs into 40' containers. Do we export more or less today to Mexico and Canada then we did before NAFTA? How much? Did you know that real wages fell in the 10 years prior to NAFTA and increased in the 10 years after NAFTA? Did you know that manufacturing jobs increased for seven years after NAFTA passed? How is that possible? The only denial here is coming from you.
I was busy reading the article but almost immediately, these thoughts came to mind.
Is "Cap and Trade" different that credit derivatives and the resulting hedge funds?
Is Bernie Madoff's Ponzi scheme different than Al "the boob" Gore's carbon credits?
Is Nancy Pelosi or Harry Reid different than previous corrupted politicians?
I'll resume reading the article and look for answers.
Perhaps that's why they were all so eager to throw money at the problem in October. No need to assign blame - just solve it. Well, it wasn't solved and blame still needs to be assigned.
But sometimes full info is not available with which to evaluate a product, a security, or a market. For example, what would you do about the Chicago livestock "Yellow Sheet" scandal of several years ago? Butt out and blame the stockmen and feedlot operators who were gulled and cheated for not knowing enough, for being lazy and uninformed?
You really do need policemen. The NASD seems to agree.
I think essentially what happened is the Investors found a way to eliminate risk from the free market...thus destroying the free market in my opinion. This allowed them to make all sorts of bad investments they would not otherwise have made...including, bad mortgages, subprime credit cards, seriously bad business investments and the last shoe to drop I suspect is commercial paper. It’s going to get uglier.
We got better deals because they had rigged the market to make money whether we repaid our debts or not...however, as Warren Buffet noted such trading could not be sustained and was essentially a hydrogen bomb set to explode basically destroying the economy when such an explosion occurred, and it did. I think by bailing our AIG and the rest of them, we saved their asses, but cooked our own goose.
Crazy isn't it? Obama gets elected and all of a sudden the Village Voice becomes an objective and balanced source for information related to our financial system. Overnight they changed their stripes and now allow for something other than the anti-capitalist drivel they've been promoting since I can remember? Nope. They are still a bunch of anti-capitalists and this guy Lieber is right at home with them. He's been railing on big corporations and condemning our system for a long time. The fact that this is the Village Voice makes whatever is written here suspect. Vipers in a nest.
It’s my view that this is why the government is pushing mortgage rates as low as they can... It’s not enough that those with “risky” mortgages refinance. We can’t unwind what’s been done to the CDS market... we’re going to refinance our way out. I think they think that if rates go low enough, nearly every mortgage in the country will be refinanced and the CDS’s will unwind themselves...
Just a thought...
To bad the lords of the universe poisoned your well...I would not cut capital gains and encourage these idiots to do more damage to this economy....now aid to small business is another story.
Also, remove your money from the big banks...put it in local banks and credit unions...stuff some of it in your mattress.
They came into the market so the traders could remove risk...and thus make incredibly chancy investments...and yes the government colludes with them.
Much of the negativism is related to the fact that we've just elected a Marxist as President. The economic situation can only get worse with this moron in charge.
If you go to Ohio, Upstate New York, Indiana, Pennsylvania, Michigan etc., you can see the empty factories-ghosts of the more prosperous times in American...before free trade, globalism, credit derivative crap etc...so yes Nafta did cause job losses....many job losses.
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