March 03, 2009 07:31 PM
I wish Geithner would stop dithering around.
I think Krugman is right. We are stuck with these zombie banks and Tim won't pull the trigger.
On this side of the Atlantic, Tim Geithner seems committed to the view that banks should stay private even if they’re bankrupt, because — well, just because.
{snip}
And we have the spectacle of James Baker — James Baker! — attacking the Obama administration from the left, calling for temporary nationalization of zombie banks as part of the recapitalization process.
The sickening feeling of drift — the sense that policymakers are refusing to face hard facts, and are dithering while the world economy burns — just keeps getting stronger.
I cannot fathom why Obama would risk his entire recovery program like this!
Get rid of these damn blood sucking zombie banks, already! Give the market some stability, and move forward.
Lead, Follow, or get out of the way.
Republicans have shown their leadership will send us over a cliff. They refuse to follow, and they seem to enjoy sitting in the middle of the road and complaining.
It's high time to just stop listening to them and do what you're gonna do. If need be, just put your iPod's headphones on your ears and tune them out while you go about fixing this huge mess.
The financial sector is toast. They depend upon consumer confidence. I'm in my 30s. I watched my parents scrimp and save their whole lives for their retirement. Their retirement money is all gone and they are about to lose their home. Everybody I know that is my age or younger is watching this. We are all busy moving our kids into the same room so we can clean out a room for our Baby-boomer parents. This is where younger people are at mentally; Wall Street is Scam Street. You give your retirement money to Wall Street and it will be stolen.
The housing market is the same deal. I don't have a mortgage so I am safe. Everybody I know that has a mortgage is trying to find a way out of it. Nobody wants to deal with the banks. Even if the banks had butt loads of money to toss at potential home buyers. They would find only a handful of people willing to do business with them. The prevailing attitude is fuck it; let the home values tank. It will make it cheaper to rent.
Obama is tossing money at the problem to keep the thing alive. This is the crawl phase; or, as I like to call it spend and pray.
The walking phase will be when he nationalzes a handful of banks and financial institutions.
The run phase will be when people realize that government needs to take over the role of lending to people to buy homes. They will also realize that they need to take over the role of insurer as they had to do with flood insurance.
The paradygm has shifted. Government is about to take over a role that the private sector is too fucked up to handle.
http://informationclearinghouse.info/article2...
Read it and weep.
"The US has an army of 90,000 soldiers in Afghanistan and is spending $100bn a year, but has still been unable to defeat 20,000-25,000 Taliban who receive no pay at all." - Patrick Cockburn
I will need to study the article more carefully. Chossudovsky says the US is the most indebted Nation which is true, but then fails to talk about debt to GDP ratio where we fall in the middle of the pack globally.
That is a glaring omission and I am that more cautious about the other things he has to say.
Global Research.ca has several contributors who fall into that trap. Ellen Brown is another who is not thoroughly researched.
---
Now where I agree, the money for the banks is welfare for the Fat Cats.
statusquObama, change you can only pretend in
The ruling class has cooked up plots to overthrow the government over much less. Just ask Smedley Butler. Nationalise the banking industry of the USA? That's only half the game, and not enough to fix things. The other half would be to disband the Federal Reserve.
At that point the plutocrats would be done in. I don't think they'll go for that and would just as soon use their funds and influence for a coup.
As I said, they've plotted similar actions over far less actionable moments. The New Deal is small potatoes compared to what is needed to pull the USA out of its death spiral.
It's called the American Dream because you have to be asleep to believe it.
-George Carlin
... unless the "fixing" helps his buddies. Just another example of why trusting those who brought us to this point is exactly the wrong idea.
Break the bankers, wholly and absolutely. Make them live their worst nightmare: working a job.
Corruption favors the wealthy.
[Deleted. Spam-Sitemonitor]
I spend my Sundays in an illegal alien's opium den surrounded by crack whores injecting the breath of freshly aborted embryos, and even I know that bankers are the epitome of evil.
Corruption favors the wealthy.
[Deleted. Spam-Sitemonitor]
Who were your high school history teachers? I know I'm not the only person who had the football coach, the wrestling coach and the baseball coach. Hasn't history traditionally been the Gumby subject that was taught by following along in the textbook so the coaches had time for more important things?
So why should we do anything differently with insight from the past during _this_ depression?
My high school varsity basketball coach.
Coach Cook.
He'd usually be at least ten minutes late for class. When he finally showed up we'd all eventually shut up and he'd talk to us about his personal life for another ten minutes. Where he and his wife went shopping the day before, what they bought etc.
Then he suddenly decided that the Civil War was the most important thing we needed to learn about. He made us memorize every minute detail of every battle, every date, every General, every location with no discussions what so ever about the politics of what was happening or why.
Plus he was a very good-looking guy and spent the other half of the class flirting with all the pretty girls he could.
And that's why almost everything I've learned of importance historically has been on my own.
High school varsity basketball coaches should just stick to teaching "health" or supervising gym classes.
Just sayin'.
"The US has an army of 90,000 soldiers in Afghanistan and is spending $100bn a year, but has still been unable to defeat 20,000-25,000 Taliban who receive no pay at all." - Patrick Cockburn
passing out condoms.
I got 4 years of history in high school, back in the 1950s. And civics. We had two history teachers, full time, both maiden ladies with a passion for history and politics.
Out of all of this, I became a Great Depression junkie. My folks had lived through it and we were just coming out of it, really, back then.
The one thing, well, there's more than one thing, but a prime difference with the last Depression and this one is the people's ability to be self sustaining to a great degree. We are an urban society now with citizens who have been told ad nauseum that they are consumers. Most people aren't going to have a clue how to survive. I have heard that some city kids don't know where milk comes from.
Those people are going to be pissed. And I'm afraid of them more than the fact that we will be poor again.
The US was also a mostly urban society back in the 30s too.
Plus them farmers had the whole fun and games that were the dust bowls in the planes.
I am not saying things are great now. But come on people, some perspective.
We are more educated, we have better communication capabilities, and more importantly... we know better now.
Better communications? Not if you can't afford the internet. Or don't have a phone.
Urban? Yes, you are right there but even then people had the skills necessary. They had to.
And we didn't have that damned tv.
The situation is nowhere near as bad as it was in the 30s. Period.
When it comes to communications, I wasn't referring to some family somewhere losing their America Online account. Stop being so self centered, it tends to give people tunnel vision and lack of context.
I was referring to the fact that we, as a society, have access to better means of communication, there are more educated people with higher levels of education (percentile wise) than during the 30s. Therefore problems can be analyzed faster, and solutions can also be enabled faster.
All this screaming to high heavens makes things worse and doesn't help at all. However, just like in the 30s, FDR's words still hold true: we have nothing to fear, but fear itself.
Panic is not the way to tackle this crisis, period.
The US Census Bureau defines an urban area as an incorporated town with more than 2,500 people.
Back in the 1930s it was 2,000 people.
1900 41% of people involved in agriculture
1930 21% of people involved in agriculture
2001 1.9% of people involved in agriculture
People back then knew how to grow food. People today do not. We are some serious trouble if the food supply gets disrupted.
A population whose 80% of its members live in cities.... yeah, pretty much it means that it is an urban population.
And the states which had relatively higher % of people working in the agrarian sector were some of the worst affected by the dust bowls.
In fact, if you really think about it... given that one of the biggest (if not the biggest) migration in US history involved people moving out of those agrarian states. The percentage of people who were ABLE to grow food in the 30s may not be that much larger than the one we have today.
But hey... lets not let common sense get in the way.
We've got Rush! He'll certainly feed at least 30% of us.
As recently as the 1970's, the United States was the worlds biggest exporter of manufactured goods (don't know how we stacked up with the export of agricultural product), now some 30+ years later...or one measley generation...we have become the worlds biggest consumer of imported goods, and all that exporting we used to do? Non-existent today.
This is not good.
really i dont
do you understand what it will be like when they finally have to announce that the entire system is truly broken beyond repair?
that we are in a depression...not a recession?
this is like buying a car with 100,000 miles on it, but the dealer tells you that the previous owner kept it in great working condition, and all it needs is a tuneup, and you take it out on the road, and the chasis disintigrates
i wonder if obama has gotten any sleep over the past month
I think "nationalization" is such a scary word to so many people that they're basically waiting until enough "experts" (like Krugman) grab them by the throat and force them to. They don't want to do it as long as it seems like a "choice" they are making. (cf. the FDR "I agree, so make me do it," position.)
Not that I agree that thats a smart thing to do. That is just my theory as to what they are thinking.
That, or Geithner is just too deep into the culture of Wall St. to admit its what needs to be done.
To me the crux of the matter is: "What is money?"
To us "common folk" money is a medium of exchange, hence the name currency - it keeps the flow flowing.
To the "fat cats" money is a commodity to be accumulated.
BIG difference.
THEIR avarice for accumulation has broken OUR medium of exchange.
It is therefore time for the government to nationalize the banks to give stability to the medium of exchange to get the flow flowing.
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
Not the same concept... and very different ramifications.
“Tim Geithner seems committed to the view that banks should stay private even if they’re bankrupt, because — well, just because.”
...because of an ideological belief that government shouldn't be running banks. I had kinda hoped that with the election of Obama, we would be rid of ideological based policy making. The criteria ought to be, what is the cheapest and most effective way out.
It seems we're going the big dig route. We had the initial big dig, then the big dig of Iraq, now, the big dig of AIG (which PBS said is holding $750B in derivatives), and the big dig of City, BofA and the rest of the banks.
Every few months, $30B here, and $40B there. It looks to me like a sinkhole without end. In the end, the treasury might not be in much better shape than City is in right now.
I think these derivatives constitute a giant ponzi scheme. Much of these "derivatives" are insurance policies, renamed "derivative" in order to circumvent insurance regulations. The participants should be criminally charged for violating insurance regulations.
I've never heard of the ultimate participant in a ponzi scheme making out, and the government is assuming the role of ultimate participant. I'd like to hear some ideas how to surgically disconnect the derivatives from the rest of the financial system.
If nationalization will hasten the bank recovery, then I'm all for it. I think that trying to pay off all these derivatives is insurmountable.
The good, the bad, and the ugly:
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
who is afraid to do a man's job. That includes burning your friends in the banking business. They fucked over their nation, Tim. Burn them, then bury the corpses and hope that provides some small measure of nourishment for a new economy to emerge.
Are you afraid, Tim? That's fine. But don't. Let. It. Stop. You. From. Saving. Your. Country.
Possibally trust or take Baker for his word... His has no character and just as big of a crook as Bush Jr. , Bush Sr. , Cheney or any of them...
The Bushs' Bakers and Saudi Arabia with their Carlyle Group steals money from everyone....
http://www.thenation.com/doc/20041101/klein
If anyone believes that Bush , Baker , Bush Sr or any of the republicans give a d... about the American citizens then they have been sleeping for over 10 years..
None
I lived in Japan throughout the 90's and felt first hand the awful stagnation and constant fear that a financial system lead by large zombie banks causes. Japan always had its large banks, as they were integral to the corporate groups who didn't use equity or bond sales to finance expansion. In the 90's both manufacturing and the finance sectors drifted aimlessly, and the average Japanese person knew their politicians didn't have the courage to do the right thing. The U.S. has the advantage that these large zombie banks are not tied specifically to any manufacturers. However, our politicians are beholden to these large banks for campaign contributions, so we have cowardly politicians. Incumbency democracy will be our demise.
No one has confidence in them at this point, there assets are among the undead and no investor in their right mind will go near them with a 10 foot pole. The government can help expedite the bankruptcy process, they need to clear off the books and let fresh money in.
Not only is Geithner (who helped repeal the Glass-Steagall Act of 1933 which lead to this crash) but so is Bernanke in his testimony today.
Ben is utterly clueless, not even the average citizen will eat that tripe.
Goodnight, Frau Blücher
I haven't heard a single reputable economist say anything other than "nationalization is the only option."
Even Republicans are calling for it. If everybody is in agreement, and they refuse to act, something smells fishy.
I could be wrong, but I think that Pres. Obama is putting too much faith in Geithner, and Geithner, possibly because of all his close ties to N.Y.C. financiers, won't advise the President to do what he must do--impose a temporary government stewardship on these diseased banks.
is that the james baker who defended [Deleted. Racist. Site Monitor]for the death of there loved ones.
I hate to agree with that fuckhead James Baker, enabler of the 2000 presidential election debacle, but it is time to pull the trigger on all these failing banks.
Nationalize them, sell off the assets, fire the CEO's without a golden parachute, and if necessary prosecute them for malfeasance of funds.
To use a "Wonderful Life" analogy, if Banker Old Man Potter was willing to prosecute George Bailey after Potter stole Uncle Billy's bank deposit, it's now time for the bank examiners and the cops to arrest Old Man Potter.
Democratic Party progressive, Vietnam veteran and proud Union member for 41 years
Any suggestion that the “true value” of assets is higher than anything the market is actually willing to pay is just ridiculous. Where do people think "asset values" come from, a random number table?
They reflect what people are willing to pay. A value is whatever a willing buyer and willing seller, neither under duress, agree to. That's a painful truth, but it's true nonetheless and we all have to deal with it.
[Deleted. Spam-Sitemonitor]
30 somethings.... STOP BELIEVING GOVERNMENT CAN SAVE YOU!
Think about it, Who pays for the billion dollar campaigns to get these politicians elected? Hmmm. It IS NOT you and me. We don't have Billions of dollars between ourselves. It is the people with money. Therefore, you CANNOT count on the government to do anything but pander to you and protect the interests of those who got them elected.
Obama is no different than Hillary or Bush or McCain, etc, etc.
Moreover, Government intervention/interaction has caused the mess we are in now. They forced banks to provide mortgages to people who otherwise could not have afforded a home. The banks, in turn, tried to generate profits "now" on the bad loans they were forced to make in the hopes that they could reduce their risk and pocket some cash. AIG DEFINITELY knew that they were selling insurance on packages of loans that they desperately hoped they would never have to pay out. SO, they paid significant monies on a yearly basis to the same people in the government that tax, spend, and regulate their industry.
DO NOT believe that Government getting MORE INVOLVED in any of this is going to help you. Geithner is not that smart. Obama is not that smart. Let AIG fail now! Let whatever other banks that are going to fail, fail now. In the longrun, we might be able to retire by the time we are 70. Otherwise, we will be living with our own children when they are 30 with NO HOPE of ever paying down any deficet or even our own mortgages. BTW, Social Security - established by these same government people you put so much faith into - is a bigger ponzi scheme than Maddoff and that money has already been spent bailing out AIG, GM, etc, etc.
More Government CANNOT save us. Less Government is our only hope!
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