The [Economic] Bomb Has Yet to Detonate: Why the Bail-Out is a Lie!

Re: Why Bail? The Banks Have a Gun Pointed at Their Head...

JonnyRadar said:
ok, i'm gonna give away my economic ignorance here... Embarrassed but i have a few questions. i find as i'm talking to people about this issue (the "bailout"), more often than not i'm saying "umm, i'm not sure...!"

so, the bailout is a temporary fix to a problem that will ultimately manifest in the collapse (or at least a heavy depression) of the economy. so at the very least, the US will experience an economic slump that will "take it down a notch" - if not total collapse.

my question is, i guess - if something akin to the bailout isn't done, won't our economy collapse in like... a month or two? as the Cs have said, apparently we're beyond the point of no return, so to speak. i'm not really "worried" about that. it's been evident for a while that our system is screwed, so that's a given. but it's been interesting to hear (i listen to a lot of radio) that so many people are "arguing against the bailout," when if something of such a drastic sloppy-bandaid nature isn't done, it seems as though we're looking at 1929 within the next 8-12 weeks?

perhaps i'm worrying about something placed in a future that is not set, but as so many have said, and i echo the sentiment, it really seems like we're right on the doorstep of total economic collapse - bread lines, fights at the gas station, mass poverty/starvation, etc... and with the mindset of a lot of americans (especially in rural areas where gun cabinets abound) might as well throw in some domestic disturbance as well...

can anyone with some more financial/economic knowledge shed some light on the situation? specifically in regards to the actual state of the economy? though data and signs point to collapse, i find myself lacking in the ability to explain this to people who ask.



Check out the thread titled "The [Economic] Bomb Has Yet to Detonate: Why the Bail-Out is a Lie!". The articles and posts address a lot of your questions.

Moderators: Would it be a good idea to collapse the two threads together, so that there is one main discussion thread on the subject of the Bail Out?
 
Re: Why Bail? The Banks Have a Gun Pointed at Their Head...

PepperFritz said:
Moderators: Would it be a good idea to collapse the two threads together, so that there is one main discussion thread on the subject of the Bail Out?

Done - though since posts are merged depending on the time they were posted, it might be a tad confusing for a few posts there... (thus, I left the original thread titles intact)
 
Wow, this is unbelievable. After reading the article below, I did a search on Google News and found only one (ONE!) mainstream report on the Sept.25th protests on Wall Street. CNN posted an article titled Bailout foes hold day of protests: Grassroots groups and online activists rally against the proposed taxpayer rescue of Wall Street. Note how they skillfully try to marginalize and negativize the participants as "grassroots groups" (read "Hippies"), "online activists" (read "Conspiracy Theorists"), and "foes" (read "Enemies").

I don't watch mainstream U.S. news programs. Did anyone see this event covered on television?




Protests on Wall Street - what the news media isn't showing you
AZ Guy, HubPages
September 29, 2008

Protests took place on Wall St. to protest the bail out plan - and the mainstream news media didn't even mention it

Hundreds of protestors demonstrated agains the proposed $700 Billion bail out plan for the finance and banking industry, yet the national news media in America didn't even report it! Why not? It seems strange that this barely generated a gander from the big news outlets like ABC, CNN, CBS, NBC etc. all of whom have a presence in New York City. Despite having such a large protest event occurring in their backyard, the major news media chose not to tell the American people about it. I had to stumble upon this on the internet to find out about it. That's really indicative of the pathetic state of affairs in the U.S. media today.... [see original article to view videos]
 
protests...

jump.jpg

link: _http://mobiusinformer.wordpress.com/2008/09/28/sometimes-a-photo-sums-it-all-up/
 
Re: Naomi Klein: The Bomb Has Yet to Detonate

go2 said:
The economic organization on this planet is a criminal enterprise, designed to enslave mankind. The banking cartel is not sick, but is an efficient predator. The collapse is more like a controlled demolition allowing those at the top of the food chain to pick up the apples after they shake the tree, so to speak. The following interview with Max Keisar
touches on the collapsing fiat money system. This will rob all holders of USD denominated assets of their property and transfer title to the few who benefit from this system of usury and fraud.

It is possible that you are connecting the 'sick person' (ie the economy) too closely with the disease that infects it. The economy does fine on its own, when it is not infested with predatory practices or weakened to the point of no return, even to the point of "death". But, then so too, does any country, such as the United States. Doesn't seem to matter how big or small they are, they can all sucum to the same "disease".

I would have to say that it is the STS component of any organisation/country/organism that inevitably brings its own downfall, or causes its own karmic rebound. Must admit, I wasn't expecting it so soon. More like next month. I suppose they'll have to have a war now - to "fix" the ecconomy.
 
Re: Naomi Klein: The Bomb Has Yet to Detonate

Ruth said:
It is possible that you are connecting the 'sick person' (ie the economy) too closely with the disease that infects it.  The economy does fine on its own, when it is not infested with predatory practices or weakened to the point of no return, even to the point of "death". 
Seems this statement depends on the economy in question.  Any economy built on exploitation of the weak for the gain of the strong can only expand to a certain extent.  This is just one aspect of a very complex subject, of course, but, in general, on planet Earth in 2008, very few to no economies 'do fine on their own'...

r said:
 But, then so too, does any country, such as the United States.  Doesn't seem to matter how big or small they are, they can all sucum to the same "disease".

I think I see your point, 'ponerogenesis', but, again, you are over-simplifying.


ruth said:
I would have to say that it is the STS component of any organisation/country/organism that inevitably brings its own downfall, or causes its own karmic rebound. 


Uhhmmm - the whole planet is STS - so, again, this point seems short sighted, at least.

r said:
Must admit, I wasn't expecting it so soon.  More like next month.  I suppose they'll have to have a war now - to "fix" the ecconomy.

How many more wars can 'we' have - (I'm sure we'll find out) - as far as 'I wasn't expecting it so soon' - is this related to your earlier statement that "October 23rd comes to mind" - as if something coming to mind makes it objectively true?  (must admit to being surprised that you made such a statement...)

Is it just Mercury retrograde, Ruth, that is blurring your communication the last few days or is something else going on?
 
Re: Naomi Klein: The Bomb Has Yet to Detonate

anart said:
ruth said:
I would have to say that it is the STS component of any organisation/country/organism that inevitably brings its own downfall, or causes its own karmic rebound.


Uhhmmm - the whole planet is STS - so, again, this point seems short sighted, at least.

Well, lucky you can see it! I wonder how many of this whole planet's STS inhabitants can? Only a small proportion, I would say. Condemed to go round and round in circles, perhaps?

anart said:
r said:
Must admit, I wasn't expecting it so soon. More like next month. I suppose they'll have to have a war now - to "fix" the ecconomy.

How many more wars can 'we' have - (I'm sure we'll find out) - as far as 'I wasn't expecting it so soon' - is this related to your earlier statement that "October 23rd comes to mind" - as if something coming to mind makes it objectively true? (must admit to being surprised that you made such a statement...)

Yes, I wasn't sure where this date "came from" and I didn't know if it applied to other people or just me. And no, it certainly wasn't an objective thing. I was just 'putting it out there' to see if other people had the same sense that 'there's something worse up the road'... and we'd better 'hang onto our hats', so to speak.

I can still suprise you? How odd.

anart said:
Is it just Mercury retrograde, Ruth, that is blurring your communication the last few days or is something else going on?

Something else is always 'going on'... and unless I'm on a "different planet", then mercury retrograde applies to everyone and not just me. :) Perhaps all forms of communication and communication devices too? As far as I can recall Mercury retrograde is a frequent occurance and has nuisance value only. I hope there's nothing worse (astrologically) in store for communications... It just got me worried that's all, you mentioning it and all... :(
 
PepperFritz said:
Check out the thread titled "The [Economic] Bomb Has Yet to Detonate: Why the Bail-Out is a Lie!". The articles and posts address a lot of your questions.

thanks for the tip, and to anart for merging the topics. i hadn't noticed this thread yet and reading through it gave a lot of helpful information.
 
JR said:
My question is, i guess - if something akin to the bailout isn't done, won't our economy collapse in like... a month or two? as the Cs have said, apparently we're beyond the point of no return, so to speak. i'm not really "worried" about that. it's been evident for a while that our system is screwed, so that's a given. but it's been interesting to hear (i listen to a lot of radio) that so many people are "arguing against the bailout," when if something of such a drastic sloppy-bandaid nature isn't done, it seems as though we're looking at 1929 within the next 8-12 weeks?

From what I understand , this plan won't solve the crisis since it doesn't address the fundamental problem that is bank undercapitalization.

"Whenever there is a systemic banking crisis there is a need to recapitalize the banking/financial system to avoid an excessive and destructive credit contraction. But purchasing toxic/illiquid assets of the financial system is NOT the most effective and efficient way to recapitalize the banking system....

Why isn't it the most efficient way ? Because bankers won't use the bail-out money to secure their organization, and in a very psychopathic way they will use those funds (injected to secure the whole system) for their own gain :

Besides, there was no guarantee that the banks would use the money in the way that Paulson imagines. As one Wall Street veteran explained to me, "I don't see one penny of that $700 billion ending up helping the broader economy. I see it being used to prop up share prices so the insiders can salvage as much as possible when dumping their shares".

Indeed, the $700 billion is just part of a massive "pump and dump" scheme engineered with the tacit approval of the US Treasury and the Federal Reserve. Once the banksters have offloaded their fraudulent securities and crappy paper on Uncle Sam, they will do whatever they need to do pad the bottom line and drive their stocks up. That means they will shovel capital into hard assets, foreign currencies, gold, interest rate swaps, carry trade swindles, and Swiss bank accounts. The notion that they will recapitalize so they can provide loans to US consumers and businesses in a slumping economy is a pipedream.
 
The new bailout pitch: It's NOT a bailout
Associated Press, September 30, 2008

The Bush administration is searching for a new way to sell its financial rescue plan after acknowledging some blunders and missteps in presenting it the first time around. One big key: Insist it's not a Wall Street "bailout." Now it's not about financial institutions. The focus has switched to everyday Americans. And it's not an expenditure of taxpayer money, it's an "investment"....



Oh. Well. That's OK then.... :rolleyes:
 
Bloomberg Announcement: Precursor to Bush staying on and cancelling election?

If Bloomberg can use the "financial crisis" as an excuse to stay on past his term limit.... why can't Bush....? Is Bloomberg "testing the waters" for Bush? Getting the American people used to the idea that the state of the economy necessitates the suspension of normal election rules, and perhaps the election itself?


Bloomberg expected to seek third term
Sinclair Stewart
Globe and Mail, October 1, 2008

NEW YORK — The deepening credit crisis has already laid waste to several long-standing pillars of New York, from Lehman Bros. and Bear Stearns to brokerage giant Merrill Lynch. Tuesday, it threatened to extinguish another: term limits.

Mayor Michael Bloomberg is expected to announce this week that he will seek office for a third time, a controversial move that would require the city to scrap legislation preventing mayors from serving more than two terms.

Mr. Bloomberg, a former trader who amassed a multibillion-dollar fortune through his eponymous news organization, has in the past been a vigorous proponent of term limits. However, in light of the recent meltdown on Wall Street, he will try to make the case that what the city requires now is a mayor with his financial savvy and strong business ties to steer it back on course, according to an online report in The New York Times.

“We're talking about extraordinary flip-flops. It's like beached whales flip-flopping here,” said Doug Muzzio, a political science professor at New York's Baruch College. “This is a Third World country. I hate to sound like a Marxist about this, but you've got the socioeconomic elite coming together and pushing a third term.”

Ronald Lauder, a cosmetics heir who helped finance the passage of term limits in 1993, also reversed course sharply this week, telling the New York Post that he would support a one-time exemption to keep Mr. Bloomberg in office. If city council doesn't change the legislation, he will have to step down at the end of 2009.

“To me, Mayor Bloomberg's brilliance in the financial sector, particularly Wall Street, would be invaluable,” Mr. Lauder told the Post. He could not be reached for comment Tuesday.

That newspaper, owned by Rupert Murdoch, recently ran an editorial arguing that Mr. Bloomberg should remain for a third term. And as the financial crisis has spread, several influential New Yorkers have privately urged Mr. Bloomberg to consider another bid – even though his closest aides have recommended against it, according to published reports.

An additional term would keep Mr. Bloomberg squarely in the media spotlight for another four years, which would be helpful if he chose to mount a bid for the White House in the 2012 election.

Many believed the mayor was going to enter this year's race as an independent candidate, but after lengthy consideration, he declined.

Those presidential credentials would be further burnished if he helped to nurse New York's hobbled financial system back to health after one of the most punishing years in its history.

He has reportedly taken a hands-on role in the current crisis, maintaining contact with regulators and leaders of the city's largest financial institutions. Still, it remains to be seen whether an entrepreneur – even a successful one – can bring much to bear on a problem that has flummoxed some of the brightest minds in the business world.

In some ways, what Mr. Bloomberg is attempting mirrors the political upheaval in Washington, where the crisis has quickly snowballed into a huge election issue in the battle between Barack Obama and John McCain.

Some Washington lawmakers, like Mr. Bloomberg with his re-election effort, are insisting the sheer breadth of the problem requires extraordinary measures – whether that be greater power for the Treasury Department, tighter oversight of banks, or a $700-billion (U.S.) bailout package for Wall Street, which was shot down this week amid deep political misgivings.

Those misgivings will likely boil to the surface in New York as well, say observers, especially if the rules are overturned by council without giving average citizens a chance to vote in a referendum.

Since it was introduced 15 years ago, the term limits have enjoyed strong support from New Yorkers.

Then again, so has the mayor. He is widely viewed as a strong steward of the local economy, and has earned the respect of those on the left for his championing of environmental policies.

“You could say that extraordinary times demand extraordinary measures,” said Mr. Muzzio. “Or that extraordinary times allow people to take advantage and put in place extraordinary measures. There is a difference.”

 
so, apparently the FED just secretly handed out $630 billion anyway? right before the $700 b. was shot down?

i searched for this but couldn't find it on the forums. the only other place i've found mention of it (aside from a few blogs) is on democratic underground.

_http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4124639

anyone?

edit: the DU post links to a bloomberg article: _http://www.bloomberg.com/apps/news?pid=20601087&sid=aP5hzUWla7Jg&refer=home

Sept. 29 (Bloomberg) -- The Federal Reserve will pump an additional $630 billion into the global financial system, flooding banks with cash to alleviate the worst banking crisis since the Great Depression.

The Fed increased its existing currency swaps with foreign central banks by $330 billion to $620 billion to make more dollars available worldwide. The Term Auction Facility, the Fed's emergency loan program, will expand by $300 billion to $450 billion. The European Central Bank, the Bank of England and the Bank of Japan are among the participating authorities.

The Fed's expansion of liquidity, the biggest since credit markets seized up last year, came hours before the U.S. House of Representatives rejected a $700 billion bailout for the financial industry. The crisis is reverberating through the global economy, causing stocks to plunge and forcing European governments to rescue four banks over the past two days alone.

``Today's blast of term liquidity will settle the funding markets down, and allow trust to slowly be restored between borrowers and lenders,'' said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. On the other hand, ``the Fed's balance sheet is about to explode.''

The MSCI World Index of stocks in 23 developed markets sank 6 percent, the most since its creation in 1970. Credit markets deteriorated further as authorities tried to save more financial institutions from collapse.

[...]

edit #2: here's a more recent article...

_http://www.allheadlinenews.com/articles/7012494484

Senate To Vote On Financial Rescue Plan Late Wednesday

Washington, D.C. (AHN) - Senate leaders announced Tuesday night that they would hold a vote for their own version of legislation on the government's $700 billion financial rescue plan after the Jewish holiday.

Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) both appealed for bipartisan support when they announced their call for a vote, which is scheduled for Wednesday evening in observance of Rosh Hashanah, the Jewish New Year.

The Senate's version of the bill has provisions raising Federal Deposit Insurance Corporation (FDIC) guarantees on deposits from $100,000 to $250,000, a plan being pushed by both Sens. John McCain (R-AZ) and Barack Obama (D-IL). It will also include a tax bill patching the Alternative Minimum Tax (AMT) and giving incentives to renewable energy.

AMT is a tax introduced nearly four decades ago for high-income earners. Because it was never indexed for inflation, the AMT is due to affect middle-class families this year unless legislation is put in place.

The House voted to reject legislation on the rescue plan and failed to reach an agreement on the tax extenders on Monday. The 228-205 to reject the bill included 15 of the 19 Republican congressmen from the President's home state. The Dow fell nearly 700 points as fears roiled Wall Street while lawmakers voted; the drop represented $1.2 trillion in losses.

McCain and Obama will be returning to Washington on Wednesday to vote on the Senate measure. Both spoke to the President and separately called for bipartisan support for the plan on Tuesday. Obama also reportedly called up some House members to try to persuade them to vote differently when the House holds a second vote on the measure late this week.

House Speaker Nancy Pelosi (D-CA), who with Reid sent a letter to President George W. Bush pledging full cooperation on the bailout legislation, issued a terse statement about the Senate rescue bill. "The Senate has made a decision about how to proceed and what can pass that body," she said.

Pelosi added that members of her chamber "have been in frequent communication with each other and the White House to find a plan that can win strong bipartisan approval... we are discussing those recommendations."

Treasury Secretary Henry Paulson said Monday he will continue to work with Congress to find a way forward. But Paulson and the Federal Reserve have had to find alternatives to try to stabilize the nation's financial markets in the meantime using emergency authorities. The Treasury Department has also said it will purchase billions of dollars in mortgage-linked assets using the authority of a housing bill Congress passed in the summer, according to the New York Times. The Fed injected an additional $630 billion into the global financial system late Tuesday.
 
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