Dear Friend and Reader,
Sometimes, when I’m trying to get a grip on a news story, I feel more like the kid in class with her finger in her nose than an expert. And the economic crisis is definitely one of those topics, so I’ve taken it really slow, and have the most recent details on what’s happening to our economy.
On Monday, Obama announced his nomination for Treasury secretary: Timothy F. Geithner, and head of the White House Economic Council: Lawrence H. Summers. Geithner is the 9th president of the Federal Reserve Bank and was instrumental to the Bear Stearns rescue and sale to JP Morgan/Chase. Summers is an economist, a professor at Harvard University’s Kennedy School of Government and served the Clinton administrationВ as Treasury SecretaryВ in its final year and a half. Also, his birthday is on Sunday (but he looks like he ate the cake already).
Most of the press knew on Friday about Geithner and Summers, and US stocks jumped late in the dayВ as a result. They have continued to rise on Monday after Obama skipped Pancake Saturdays to announce his two-year economic stimulus plan for “middle-class tax cuts and spending on infrastructure to help save 2.5 million jobs,” Reuters reports. The US unemployment rate hit at 16-year high last week.
Then there’s Sunday’s announcement that Citigroup would be getting more money (add $20 billion to the $25 they already got from the bailout package). Their aid is a two-parter, according to CNN:
First, the U.S. Treasury and the Federal Deposit Insurance Corporation (FDIC) will backstop some losses against more than $300 billion in troubled assets.
Second, the Treasury will make a fresh $20 billion investment in the bank. The government has already injected $25 billion into Citigroup as part of the $700 billion bailout passed by Congress in October.
In return for the latest intervention, the government will receive an additional batch of preferred shares – $20 billion for its direct investment and $7 billion as compensation for the loan guarantees. Citigroup will pay an 8% dividend rate on those shares.
In addition, the government will get warrants, or the right to purchase $2.7 billion worth Citigroup shares in the future.
The big question, for Eric and I anyway, is where is the money going?В В With reports that each of us will pay about $24,000 for every man woman and child to fund the bailout/economic stimulus, I would like to see a nice, public, itemized list describing where my money is going and how it’s being used. If those Christian charities can tell me that $10 will pay for 40 malaria vaccines and $20 will provide 100 kids food for a week, then I don’t see why our government can’t tell me howВ one year’s salary is divvied up.
Oh, and in other news, Henry Paulson is the worst Treasury Secretary ever, according to Steve Forbes. And that guy knows a thing or two about money.
Yours & truly,
Rachel Asher
I wasn’t gonna think about this anymore, but it’s an itch in my crawl that just wouldn’t go away. The numbers are so large it pains my Virgo brain. So I take it down simple.
There’s always an old rule or assumption to start from in the chaos. So, money is basically an abstract value. Money is a representation of a real value. Supposedly all money is backed by goods of some kind, niberuvian gold or something.
Now we have a situation where money is just paper and promises and there is alot of it. All the paper and promises are wrapped up in a network and nobody knows whats what. So we go back to where is the real value. I think we are taking inventory to see what we really have (materially speaking of course. And I like to eat, take a hot shower, and be warm: that takes resources, too).
The scary part is that we might be down to the important stuff, the real goods. And the bailees could well end up controlling all that. But the US treasury is supposedly getting shares in these companies. The scarier part is the info I touched upon concerning the federal reserve cartel. It implied that all this is part of a plan by cartel members to collect the actual collateral on all this bad paper ie. the real goods.
So the money is going to reorganization. If you have ever worked in administration, the manpower required is phenomenal. The casino called the stock market will be different. And where we’ll end up nobody knows.
This little exercise in thought and very little research kinduv turned my world upside down again last nite, but what else in new.
Back to carrying wood and chopping water. Brrrr it’s cold.
“If those Christian charities can tell me that $10 will pay for 40 malaria vaccines and $20 will provide 100 kids food for a week, then I don’t see why our government can’t tell me how one year’s salary is divvied up.”
LOL! Yeah, and I once heard one of those flat tax guys say, “If ten percent’s good enough for the Baptist church, it ought to be good enough for the American government!” Pass THAT tax law, and we’d be a whole hell of lot closer to being the “Christian nation” we claim to me.
It would never happen.
I hear ya gardener, but we were just doing what our boy George and the party of wishful thinking were telling us to do. If we just bought enough stuff the economy would be okay. We could even fix 911 if we went out and shopped for more stuff. Oh yeah, we should have used cash.
This Lakota thing, seems unreal. But these days, that probably is as unreal is as real as it gets. Thanks for the flash.
Well it’s been been beaten to death in the media, but bottom line is we taxpayers are going to pay for people who made $7.50 an hour being given loans for $150,000 houses. Why? Many reasons – diversity being one, fear of lawsuits another. Government wanted housing for everyone, so that’s what happened.
What would have been wrong with buying a nice little bungalow in the city for about $3,000? Houses where my uncle lived are selling for $1,000!! They are not bad little houses. If enough people would move back into the old neighborhoods and reclaim the schools, there would be no reason for so many people to live in the suburbs. Fear has hurt us beyond belief, that and living beyond our means.
We got a letter today from Citibank raising our interest rate on the credit card. We rarely carry a balance on it so why do we have to pay for others mishandling of money? It’s the same shit over and over again.
Well news flash – this just in:
These Native Americans know how to read the constitution of thes e United States.
People of Lakota Launch Private Bank for Only Silver and Gold Currencies
http://press.freelakotabank.com/
Hill City, Lakota – November 24, 2008 – In a stunning development, the Free & Independent People of Lakota announced today the introduction of the world’s first non-reserve, non-fractional bank that accepts only silver and gold currencies for deposit.
“Today is a great day for us, a day that we begin to exercise our rights as a sovereign people with strength and pride,” comments Canupa Gluha Mani, Tetuwan Council Judicial Member of the Cante Tenza “Strong Heart” Warrior Society. Mani’s 2500 member warrior society has contracted to provide pri vate security services for the Free Lakota Bank.
“We invite people of any creed, faith or heritage to unite in an effort to reclaim control of wealth. It is our hope that other tribal nations and American citizens recognize the importance of silver and gold as currency and decide to mirror our system of honest trade.” Mani, also known as Duane Martin Sr, is a member of the delegation that declared Lakota independence on December 17th, 2007.
The launch of the Free Lakota Bank is also an incredible victory for StrikeForce Technologies, the access control experts providing depositor Out-of-Band Authentication. As the Free Lakota Bank does not require a name, photo identification or social security number to transact, StrikeForce’s technology met the challenge of limiting fraud without requiring controversial biometric technology.
The People of Lakota invite depositors to establish accounts and invest in the Free Lakota Bank’s Ge neral Investment Fund, the fund it uses to develop profitable free-market enterprise inside Lakota territory. Mani comments that the nation despises donations and charity, and instead insists instead on “earning our wealth by creating value for those that place their faith and trust in our system.”
The Free Lakota Bank issues an American Open Currency Standard Approved currency, making it readily accepted for trade by over 10,000 merchants and businesses across the continent.
For more information, visit the Free Lakota Bank website at http://press.freelakotabank.com
Isn’t the money going to pay off the credit swaps? There is a problem with the foreclosures that set the market on its head. But where that is a trillion or so dollar deficit, the credit swaps market is more like 60-70 trillion.
60 minutes talked about this some weeks ago. In case you haven’t looked at the swaps, it goes like this per 60 min.
First off, the insurance industry is regulated so that they are required to have available cash to cover all insurance policies.
Financial institutions bundled home loans and sold and resold them. Something called a credit swap was invented which insured these packages. Since it was not “insurance” but “credit swap”, it was not regulated by the insurance industry. It is an underground market with no capital to back it up. It is also not traceable because no law required disclosure (because we did not know it existed? Somebody must have).
A question asked in the same episode, is why have we created companies that cannot afford to fail.
If this is indeed what is going on, I would think the best solution would be to end foreclosures. Or I would like to know the criteria for saving certain institutions. I know AIG handles all government pensions and we do so need our public servants to be taken care of as the general populace’ 401K and health insurance goes down the pooper. But what do I know when it comes to big old convoluted behind the door messes. Not even our man Obama will step forward and give us the skinny on this one.
You can check financial statements for these institutions on the net, but they are pretty cryptic. I got some ratios I could run but I really don’t want to go that route. Like I said, it is why I got out of accounting. And it doesn’t matter what laws are put in place, people will find a way around them.
It reminds me of my kids when they were little and wanted something – “Just write a check!” was their happy go lucky refrain. It reminds me of the times I have helped young relatives with a bill, say a gas bill for instance. Then I find out that they figured since they have the extra money (ahem – MY money) they can go ahead and attend a Colts game or go to a Nascar race.
There are a whole lot of people who need to grow up and be accountable, but they are still spoiled brats at age 64 and want everything and don’t care who pays for it as long as it isn’t them.