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Last Years Economic Meltdown was Just an Appetizer of Things to Come

The crisis the world went through is just an appetizer for a future one because the weaknesses that created it have not been addressed, Marc Faber, author and publisher of the Gloom, Doom and Boom Report, told CNBC Friday.

“It’s a total and complete disaster and the crisis we had is just the appetizer to the big total breakdown of financial markets and of governments in five or 10 years time when the whole system goes bust,” Faber told “Worldwide Exchange.”

Is Capitalism a Love Story or Nightmare?

Many Americans think that Capitalism and Democracy are the same thing.  This is simply not true.

Michael Moore has proven again and again that he has a remarkable feel for where the zeitgeist is heading. He’s like a zeitgeist divining rod.

Roger and Me was way ahead of the curve on the collapse of the auto-industry. Fahrenheit 9/11 was way ahead of the curve on the collapse of the house of cards the Bush administration used to lead us to war in Iraq. Sicko was way ahead of the curve on the collapse of the US health care system. And now with his new movie Capitalism: A Love Story he is riding the wave of the collapse of trust in our country’s financial system.

The film, which opens in New York and Los Angeles on Wednesday, and all across the country on October 2nd, is a withering indictment of the current economic order, covering everything from Wall Street’s casino mentality to for-profit prisons, from Goldman Sachs’ sway in Washington to the poverty-level pay of many airline pilots, from the tidal wave of foreclosures to the tragic consequences of runaway greed.

The film also turns the spotlight on some underreported gems: an internal Citibank report happily declaring America a “plutonomy,” with 1 percent of the population controlling 95 percent of the wealth; an expose of “dead peasant” insurance policies that have companies cashing in on the untimely deaths of their employees; and amazing footage of FDR, found buried in a film archive and not seen in decades, calling for a Second Bill of Rights that would guarantee all Americans a useful job, a decent home, adequate health care, and a good education.

In capitalism as envisioned by its leading lights, including Adam Smith and Alfred Marshall, you need a moral foundation in order for free markets to work. And when a company fails, it fails. It doesn’t get bailed out using trillions of dollars of taxpayer money. What we have right now is Corporatism. It’s welfare for the rich. It’s the government picking winners and losers. It’s Wall Street having their taxpayer-funded cake and eating it too. It’s socialized losses and privatized gains.

While unfurling yellow crime scene tape in front of a “too big to fail” bank, he became aware of a group of New York’s finest approaching him. Moore has a long history of dealing with policemen and security guards trying to shut him down, but in this case he knew he was, however temporarily, defacing private property. And his shooting schedule didn’t leave room for a detour to the local jail. So, as the lead officer came closer, Moore tried to deflect him, saying: “Just doing a little comedy here, officer. I’ll be gone in a minute, and will clean up before I go.”

The officer looked at him for a moment, then leaned in: “Take all the time you need.” He nodded to the bank and said, “These guys wiped out a lot of our Police Pension Funds.” The officer turned and slowly headed back to his squad car. Moore wanted to put the moment in his film, but realized it could cost the cop his job, and decided to leave it out. “When they’ve lost the police,” he told me, “you know they’re in trouble.”

Modern Day Government Subsisdized Loansharks

Where is the help for the hard working men and women that helped to build and maintain this great country of ours?

US banks stand to collect a record $38.5bn in fees for customer overdrafts this year, with the bulk of the revenue coming from the most financially stretched consumers amid the deepest recession since the 1930s, according to research. The fees are nearly double those reported in 2000.

The finding is likely to increase public hostility towards the financial sector, which has been under political pressure to ease the burden on consumers by increasing credit availability and lending more fairly after being bailed out by taxpayers.

The median bank overdraft fee has this year rose from $25 to $26, according to Moebs, the first time it has gone up in a recession for more than 40 years.

“Banks are returning to a fee-driven model and overdraft fees are the mother lode,” said Mike Moebs, the company’s founder.

Overdraft fees accounted for more than three-quarters of service fees charged on customer deposits, he said.

The most cash-strapped customers are the hardest hit by such fees, with 90 per cent of overdraft revenues coming from 10 per cent of the 130m checking accounts in the US. Regular use of overdrafts is most common among consumers with low credit scores, Moebs discovered.

How much is Joe American, used to being middle class,  expected to suffer?

We are all getting tired of being raped by the so called suffering financial institutions in this country and the Fed.

Yet they somehow find the funds to pay out billions in exorbitant  bonuses, while denying credit to the businesses that can help get America and the GDP moving more positive.

Maybe it’s time for the average consumer to pay cash or put it away, like the old days on layaway.

I’m thinking that we all have responsibility in this crisis, but many of us are also getting tired of being plugged in the ass dry.  Cash is king for now and if you can’t afford to pay cash maybe it’s more of a want than a need. To be truthful I’m looking forward to a simper, kinder, and more loving America.

Ironically it seems like those who are most affected by the economy,  are also the same families and individuals who are best coping with our current economic crisis.

If this is capitalism, then I suppose I’m guilty of being a socialist.

I believe in the fair and equitable distribution of wealth.  The hypocrisy in this nation never ceases to amaze me.  We claim to be a God Fearing and loving Nation, yet we turn a blind eye to those who can’t take care of themselves.  Unless they are in the womb, then after they are born they are on their own.

The real travesty of justice, is that this country has more than enough resources to take care of everyone.  The elite 1% could still have their 24K gold plated fixtures on their G550′s and mega yachts.  They just need to pay more taxes.

Is anyone else tired of seeing  the rich housewives of  New York, New Jersey, and California  paying more for a purse then it would cost a family of four to pay for health care in the U.S?

Not too mention the state of CA is going broke.  They are issuing IOU’s to pay bills.  Does anyone besides me see a problem with that.  Why should we continue to subsidize the rich when they are more than capable of paying their fair share of taxes?

We are spending hundreds of billions if not trillions fighting wars in Afghanistan and Iraq.  Mostly for the protection of an antiquated fuel source called oil and the cheap economy it supports.

Don’t kid yourself, we are not spending billions in Iraq and Afghanistan to save humanity and the democratic/capitalistic way of life, or in a futile attempt to eradicate opium.  It’s all about fossil fuels and the upcoming energy wars.

The Afghans have been living in turmoil for 30 years or more.  Most of them are illiterate which makes the dissemination of information difficult if not very improbable.

Afghanistan brought down the U.S.S.R. with our help in the 80′s.  They may very well do the same to to the United States of America,  maybe this time with Russia and China’s help.   Unless cooler and more intelligent heads prevail, I fear we are heading down that very road.

The U.S.S.R didn’t get it, until it was too late.  Hopefully we can and history doesn’t repeat itself again.  It’s about time that we got over ourselves and realized just because we have the most nukes doesn’t give us the right to be the worlds bully and police force.  Maybe someday we can really give peace a try.

The Afghanistan war will cost us much more than the Vietnam War, both in human and monetary cost.  Do we even have proof that they are enemies?  Or are they for the most part poor illiterate uneducated farmers trying to provide for their families.

These are people that have known nothing but war for over 30 years, are we really that arrogant to think we can win this war?  Let’s face the truth, most American have no idea of the true horrors of war.  It’s become something we put on a balance sheet.

If we learn nothing from the past,  I Pray that we can learn quite quickly that we will never win in Afghanistan.  Look what it did to the Russians and the empires before them.  Afghanistan brought down the Soviet Union and it will do the same to us if we don’t learn from past mistakes.   The U.S simply cannot afford to be the world’s policeman at this time.

Bottom line most middle class Americans are living on borrowed time.  Once the credit is exhausted shit will really begin to hit the fan.

How much more are the working men and women of this great country supposed to endure?  All the while the fat cats of Wall St. grow richer at the taxpayers expense.

Why do we think that as Americans we have the right to tell the rest of the world how to live and run their governments, when we can barely run our own country?

Maybe it’s time for us to get our own country into better fiscal shape, before we take on the world.

The Romans thought they had a good plan too,  until they realized it was too late.

Let’s hope that the United States of America doesn’t have to make the same mistakes by spreading our military strength too thin, until we realize it is economically and politically unsustainable.

Wall St. is Profiting Big From Trading With the Fed and Taxpayer Money

Wall Street banks are reaping outsized profits by trading with the Federal Reserve, raising questions about whether the central bank is driving hard enough bargains in its dealings with private sector counterparties, officials and industry executives say.

The Fed has emerged as one of Wall Street’s biggest customers during the financial crisis, buying massive amounts of securities to help stabilise the markets. In some cases, such as the market for mortgage-backed securities, the Fed buys more bonds than any other party.

However, the Fed is not a typical market player. In the interests of transparency, it often announces its intention to buy particular securities in advance. A former Fed official said this strategy enables banks to sell these securities to the Fed at an inflated price.

“You can make big money trading with the government,” said an executive at one leading investment management firm. “The government is a huge buyer and seller and Wall Street has all the pricing power.”

A former official of the US Treasury and the Fed said the situation had reached the point that “everyone games them. Their transparency hurts them. Everyone picks their pocket.”

Barney Frank, chairman of the House financial services committee, said the potential profiteering may be part of the price for stabilising the financial system.

“You can’t rescue the credit system without benefiting some of the people in it.” Still, Mr Frank said Congress would be watching. “We don’t want the Fed to drive the hardest possible bargain, but we don’t want them to get ripped off.”

Fed Chief, Ben Bernanke Doesn’t Know Where $500 Billion in U.S. Taxpayer Money Went

Federal Reserve Chairman Ben Bernanke ventured to the Hill this week for his semi-regular beating at the hands of freshman Rep. Alan Grayson (D-Fla.).

Grayson’s Fed exchanges have become small sensations online; a May grilling of the Fed inspector general approaching a million views on YouTube and roughly another million on other video players.

The swaps represent a radical intervention by the Fed in the global money supply but have barely been covered by the media. They are done without approval from or oversight by the Congress or the White House.

Bernanke, asked by Grayson what the central banks did with the U.S. money, replied: “I don’t know.”

Grayson, in an interview with the Huffington Post, said that the lending program represents a startling amount of decision-making authority vested with one man.

He put the $500 billion-plus lending program in perspective. “I see all the time, still to date, actual recorded votes on $100,000-dollar elements on these actual appropriations bills. Now compare that to the fact that the Federal Reserve handed out $500 billion dollars, which is literally five million times as much…and they don’t even know who ended up with the money,” he said.

“Was the money used to buy U.S. treasuries and prop up the dollar? They don’t know. Was the money used to bail out European automakers? They don’t know. He literally doesn’t know what happened to $500 billion dollars,” he said. “I find that extremely disturbing.”