PBS's Frontline

has an episode tonight about the worst economic mess in 70 years:



This is the first part of it.


link


It's a must-see.

Obama's Press Conference

At least one person is having grave doubts about Obama:

But he was evasive, and quite obviously and squirmily so, at many other times during that conference, and often fell to speechifying and particularly verbose and complex circumlocution in an rather blatant attempt to deflect attention away from the actual question that the questioners asked. This makes me very uncomfortable. I had so deeply hoped for better. I had hoped for actual openness, and it seems that it ain't happening.

Mr. Obama is getting some very bad advice, bad advice that decries open partisanship at need, bad advice that denies the value of punishing Bush administration wrongdoing, bad advice regarding openness and honesty to the public, and some VERY bad advice on the nature of the economic recovery programs that we need. I believe that the Dow went into the dumpster yesterday because this bailout is looking increasingly like Obama is planning to follow some very Bushian policies (in return for the illusion of bipartisanship) and that Tim Geithner looks an awful lot like a weasel and talks like one, too. Picking him was a terrible blunder. Why not Robert Reich, or even Paul Krugman?

Nobody except fatcat robber barons wants to further enrich fatcat robber barons, but the immense Treasury plan, and to a slightly lesser extent the Senate version of the recovery package, seem to have this aspect to them as their chief features. Speculators do not deserve rescue, nor do those whose subterfuges in crafting opaque investment instruments led us into this mess. They are the ones who have earned the right to sleep in refrigerator boxes under bridges, not American wage earners and office workers whether in the private sector or the public.

I thought that this past election was supposed to bring us hope. I'm having a very hard time feeling any at all. Indeed, I am getting the awful feeling that we have no hope at all, and even our victories are defeats as America falls deeper and deeper into plutocracy and two-class feudalism. This was supposed to be different. Dammit, this was SUPPOSED to be different!

Understand how the Nazis oozed out from the muddy ashes of the Weimar Republic. It all started with the printing of mountains of worthless greenbacks during a period of economic distress, briefly masking the pain of that distress without addressing its underlying causes.

Be afraid. Be very afraid. One thing we have decidedly not done or even discussed: It is wrong to allow any private enterprise to become "too big to fail." We once understood this, and that's why we passed the Sherman Act, which had a scope too limited to deal with the conditions that prevail today. We need to return to the days of really ROBUST anti-trust, and if the rightwing courts try to block it, we need to find a way to screw the rightwing judges, many of whom got their jobs precisely for the purpose of obstructing such anti-trust action.

The WSWS criticizes the administration's plan to expand the bank bailout.

Same Shit, Different Administration?

Are taxpayers going to take it in the ass again, despite a new administration, but one full of people who still believe in the horseshit of the GOP past? Are more handouts to the robber barons on the table?

That's what worries me most about Obama, his capitulation to GOP ideas which are totally discredited and debunked.

The Booming Economy

The Democrats have unveiled a budget winch to pull the country out of the economic ditch.
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Companies are trying other options besides layoffs in order to save money during these shitty times. Unfortunately, not enough companies are doing this.
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The UAW decides to sell out its workers by foregoing the right to strike.

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The banking industry is poised to ask for MORE handouts with more of them going down the tube.
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Retailer Gottschalks has put itself up for sale and may file for bankruptcy.

Another store I happen to like is about to hit the skids.

More retailer problems:

Hayward, Calif.-based Mervyns LLC, which filed for Chapter 11 bankruptcy protection in July, is now liquidating inventory at its remaining 149 stores and winding down its business.

Reading, Pa.-based Boscov's Department Store LLC filed for bankruptcy reorganization in August. Analysts say they are monitoring the York, Pa.-based department store chain Bon-Ton Stores Inc., which has also been struggling.

National chains that have been hammered include Circuit City Stores Inc., which filed for bankruptcy protection in November, said last week it's in talks that could result in a sale or additional financing. Toy seller KB Toys, which filed for bankruptcy in December, is liquidating its stores and will shut down. Goody's Family Clothing announced on Jan. 6 that it was liquidating and on Tuesday it filed for bankruptcy protection.

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Harry & David lays off 100 workers, some ten percent of its regular labor force.
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The Booming Economy

According to the WSWS, so take it as you will, our dictator and the president-elect have teamed up to cough up even more billions for the robber barons, er, banks.

The Booming Economy

More than a few executives should be facing jail time, and the taxpayers should NOT be bailing them out:

The sums of personal wealth generated through such financial skullduggery, under the protective arm of the government, are staggering. An Associated Press report published Sunday reveals that financial institutions which have to date received a total of $188 billion in taxpayer money through the $700 billion Troubled Assets Relief Program (TARP) paid their CEOs nearly $1.6 billion last year, or $2.6 million on average. In addition to TARP funds, the banks have been handed trillions in direct loans through the Federal Reserve.
Among the executives remunerated in the millions, even as many of their companies began to report losses from the subprime mortgage collapse, were:

* John Thain, CEO of Merrill Lynch, who was awarded $83 million. His firm, now merged into Bank of America, received $10 billion in TARP money.

* Lloyd Blankfein of Goldman Sachs, who took home $54 million. Goldman Sachs spread around $242 million to its top five executives. It has received $10 billion in TARP funds.

* Richard D. Fairbank, the head of Capital One Financial Corp., who was paid $17 million. Capital One was given $3.56 billion in TARP money.

* Bank of New York Mellon CEO Robert P. Kelly, who was paid $8.6 million. His firm received $3 billion from TARP.

Another Associated Press article, published Monday, documents the refusal of the banks to reveal what they have done with the billions in taxpayer funds they have received. The AP put questionnaires to 21 banks that each received more than $1 billion in the government bailout, posing four questions: "How much has been spent? What was it spent on? How much is being held in savings, and what's the plan for the rest?"

Not one bank answered the questions. I think they should be forced to repay the taxpayers for defrauding the public.

And it appears our federal government won't do jack shit to correct the problem.
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Toyota is also speeding towards the economic cliff.
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The Booming Economy

Predictably, the WSWS takes a rather dim view of Obama's economic proposals.
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Two more banks have been shut down.
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Something needs to be done to help the U.S. auto industry.

I just get SO pissed these crooks on Wall Street get all kinds of handouts when they should go to jail, while major industries are allowed to go down the tubes.

Fuck Friedmanism.
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Wall Street Mess

Our dictator has decided to become a socialist, after all, by proposing to buy shares in the nation's leading banks.

Selected Editorials

The Alaska Daily News channels Orwell in its description this morning of Sarah Palin's Troopergate troubles. She is claiming she has been vindicated, although the facts show no such thing:

In plain English, she did something "unlawful." She broke the state ethics law.

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The Baltimore Sun asks if Palin is this way in Alaska, how would she behave in Washington?

To which I ask the nation's media: If you are scrutinizing every little and major thing Sarah Palin does, WHY hasn't Barack Obama been vetted?

Inquiring minds want to know.
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I have seen NUMEROUS editorials like this one from the Buffalo News chastising John McCain's campaign because it dares to go negative, but not ONE goddamned word was EVER uttered by the news media about Obama's filthy tactics against other Democratic candidates in the primaries, namely Hillary Clinton.

Not one word.

Obama has NOT run a clean campaign. McCain's criticisms have been extremely mild compared to other campaigns.

By the way, where was the media outrage in 2000? In 2004? Hell, where was the outrage when the GOP right persecuted the Clintons during the 1990s? The media were strangely silent if not actively encouraging it.

It is indeed topsy-turvy.
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The Capital Times all but writes off John McCain, but gives him some suggestions on how to improve his fortunes. Not a word about Obama's filthy tactics against his opponents. He's the Messiah, after all.
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It appears Bush's infusion of cash to struggling banks is a better idea than Paulson's original plan.
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Sun-Sentinel: Florida STILL can't get it right over voting irregularities.

The Shitty Economy

Libor is holding the central banks hostage as credit freezes.

When did Libor start?

The measure started as a series of rates quoted by four banks as a reference for floating-rate notes and syndicated loans, Golden said.

The BBA began producing the unified rates known as Libor in 1986, an association spokesman said. That made Libor the natural benchmark when then-Prime Minister Margaret Thatcher abolished many restrictions on trading in the U.K., leading to an explosion in the range of products on offer, said David Clark, former head of funding at European Investment Bank, the European Union's Luxembourg-based development bank.

Thatcher was an ardent Uncle Miltie cultist.

The Booming Economy

There were 159,000 job cuts last month.


It is utter bullshit to argue, as Republicans do, that the Community Reinvestment Act of 1977 was responsible for the housing mess. They are cynically trying to blame blacks and even Bill Clinton for the problem THEY and their economic religion created.

It's deregulation that's the problem. It's Friedmanomics that is the problem. Milton Friedman was a crackpot whose economic theories should have been laughed out of every tenth-rate college in the United States. Instead, his and his fellow Chicago School crackpots were lionized by politicians of both political parties, especially the Republicans, and in other countries, and with ruinous results.

Friedmanomics needs to go in the trash can where it belongs.

(H/T to Cannonfire)

Wall Street Bailout

Henry Paulson declares class warfare by saying there should be no limits on CEO pay.

Paulson, the former CEO of Goldman Sachs whose wealth is estimated at $700 million, argued that including any such provision would result in banks refusing to participate in the program.

As the New York Times reported Monday, “Mr. Paulson said that he was concerned that imposing limits on the compensation of executives could discourage companies from participating in the program.

It figures.

And just who is Henry Paulson? The right crony at the right time, it seems:

Prior to being selected as treasury secretary, Paulson was a major individual campaign contributor to Republican candidates, giving over $336,000 of his own money between 1998 and 2006.

Since taking office, Paulson has overseen the destruction of three of Goldman Sachs’ rivals. In March, Paulson helped arrange the fire sale of Bear Stearns to JPMorgan Chase. Then, a little more than a week ago, he allowed Lehman Brothers to collapse, while simultaneously organizing the absorption of Merrill Lynch by Bank of America. This left only Goldman Sachs and Morgan Stanley as major investment banks, both of which were converted on Sunday into bank holding companies, a move that effectively ended the existence of the investment bank as a distinct economic form.

In other words, this is like having Al Capone oversee the U.S. Treasury.

Banks are racing to get a share of the bailout.

If there was ever a doubt Obama is nothing but a Republican, this should do the trick.

No wonder Wall Street loves him:

The decisions being taken this week in Washington on the Wall Street bailout have rendered the November election virtually irrelevant. The Democrats and Obama, no less than the Republicans and McCain, have lined up behind what amounts to a vast new transfer of wealth from American working people, the vast majority of the population, to a tiny, obscenely wealthy layer at the top.

I don't expect Congress to do a damned thing that will benefit people despite the skepticism on both sides of the aisle.

The Booming Economy

As expected, retirees are being screwed over with the mortgage/banking mess, especially since many of them were screwed out of pensions in favor of junk 401(k)s.

The Booming Economy

Wall Street continues to be in panic mode.

Here's more.

Campaign Notes [Updated]

The financial mess gives Obama a chance to regain ground lost with all of the excitement and controversy over GOP VP candidate Sarah Palin.

Not that it'll happen, but it'll give him a shot at least.

Via Cannonfire, note this little connection to Obama.

Update: University of Chicago flak Obama blasts McCain over the economy.

The Booming Economy

The Wall Street problems should give people and especially politicians a clue that the right-wing ideology governing our economic policies does not work.

The crisis with AIG is even worse:

At the same time, there were frantic negotiations over the fate of AIG, which faces bankruptcy unless it can raise tens of billions of dollars in capital. When US markets opened Monday, AIG was asking for emergency loans from the Fed to stave off collapse.

A failure of AIG threatens to bring down the entire credit system both in the US and internationally, because the company holds a large stake in the multi-trillion-dollar, unregulated market in so-called “credit default swaps.” AIG has sold CDS contracts to banks, hedge funds and big investors all over the world, under which it guarantees the mortgage-backed debt of a wide range of companies in the event that they default. If AIG should go under, the value of the debt which it insures would fall to an unknown level, destabilizing the credit markets and threatening a chain reaction of defaults and bankruptcies.

The events of the past two weeks demonstrate that the American financial aristocracy is plunging the entire country into bankruptcy. These events are themselves climatic moments in a protracted process.

For three decades, the “free market” has been elevated to the status of a secular religion in the US, with the capitalist market as its god and socialism as its devil. This period, under both Republican and Democratic administrations, has seen the wholesale dismantling of the productive base of the US economy, at the cost of millions of jobs and the living standards of the American working class.

In the name of the supposed infallibility of the market, the operations of big business have been deregulated, removing all legal restraints on corporate profit-making and fueling the accumulation of ever more obscene levels of wealth in the hands of a financial oligarchy. A vast process of social plunder has occurred, in which the wealth of the country has been redistributed from the bottom to the very top.

More bailouts are on the way.

I may not subscribe to the WSWS's ideology, but they hit this issue on the head.

Quite frankly, what in the hell did these disciples of deregulation think was going to happen?