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POPS America Will Remain the Superpower But that only means it had outperformed nearly every single major foreign stock exchange, including Germany's XETRADAX (down 28%) China's Shanghai exchange (down 30%), Japan's NIKK225 (down 37%), Brazil's BOVESPA (down 41%) and Russia RTSI (down 61%). These contrasts are a useful demonstration that America's financial woes are nobody else's gain. On the other hand, global economic distress doesn't invariably work at cross-purposes with American interests. Hugo Chávez's nosedive toward bankruptcy begins when oil dips below $80 a barrel, the price where it hovers now. An identical logic, if perhaps at a different price, applies to the petrodictatorships in Moscow and Tehran, which already are heavily saddled with inflationary and investor-confidence concerns. Russia will also likely burn through its $550 billion in foreign-currency reserves faster than anticipated -- a pleasing if roundabout comeuppance for last summer's Georgian adventure.
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POPSFinancial Crisis: The Great Bank Bailout The nine banks had "no choice" as the federal government (with money created by the Fed from thin air) is buying a portion of these banks, injecting cash into them to ease credit. This is a partial government takeover or pseudo-nationalization of these banks, also being done in the UK and Europe.
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POPSAsian Stocks Gain on Bank Stakes Plan; Treasuries,Yen Decline Standard & Poor's 500 Index futures gained 2.1 percent. S&P rebounded yesterday from its worst week in 75 years with an 11.6 percent advance, its steepest since 1939. Europe's Dow Jones Stoxx 600 Index rose 9.9 percent, a record gain. The Bush administration will invest about $125 billion in nine banks including Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley, said the people. France, Germany, Spain, the Netherlands and Austria have committed $1.8 trillion to guarantee bank loans and take stakes in lenders. Governments across the globe stepped up measures to support banks after global stock markets lost $7 trillion of their value last week, driving the MSCI World Index down 20 percent, on concern frozen credit markets will trigger an economic collapse.
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POPSGlobal Stock Markets Going Down. BadNews Bush Again
Bush didn't cause the real estate agents and banks to make bad and fraudulent loans -- but neither has he caused any recovery. Maybe, in fact, there is no quick fix to boom and bust speculation. But another fact is that this $700-billion does nor demands NOTHING that will directly help people with the predatory mortgages they were suckered into - nor guarantee more jobs -- nor make credit available again. It's only claim is "to inspire confidence." in the banks. It doesn't seem to be working and it's doubtful if anything a failed president, working with a failed Congress, could do with helping out a failed Wall Street. The SuperRich (the 1% of our population that now owns 20% of our wealth), the SuperRich still get all the breaks and loopholes and the Middle Class gets the screws put to them. Wall Street walks away with all their profits and all their bad debts are sold to the taxpayers -- Why didn't we buy stock in the banks instead? Or 100 other ways to do this bett
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POPSCommentary from a Central Banker "And what better way to ensure the corporate largesse is returned to the GOP to win back the White House and Congress in 2012 as the depression fuels public anger?"
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POPSWarren Buffett Perfectly Placed for $3Billion GE Play The shares have been hit by a poor performance from its GE Capital Finance arm, which brings in close to half its revenues, and concerns about the outlook for the broader economy. Mr Buffett said: “GE is the symbol of American business to the world. I am confident that GE will continue to be successful in the years to come.” His comments came a week after he appeared to position himself for an investment in GE by giving the group his vote of confidence. At that time, Mr Buffett, who always invests in high-profile companies, pointed out that GE has “strong global brands and businesses with which I am quite familiar”.
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POPSCongress Should Be Winding Fannie and Freddie Down receivership and restructure them. This could take place without Congress having to pass a resolution explicitly guaranteeing all $5 trillion of the GSEs’ liabilities. That dreaded scenario would double the size of the public debt and drive the dollar to new lows. This episode demonstrates how stupid and dangerous it is to allow any company to operate under the assumption that it keeps the profits while the taxpayers take the losses. For now, the U.S. has to make clear that it is standing behind Fannie and Freddie and will not allow them to fail. But to prevent an even worse catastrophe in the future, Fannie and Freddie should be broken up or dramatically downsized. It may sound strange for conservatives to back a government takeover of any company, but a takeover aimed at restructuring, downsizing, and eventually reprivatizating the GSEs might be the least bad option if a run on them actually materializes.
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POPS Evidence suggests credit crisis is not over Now there's a trend: from losses to insolvencies. In the staid Daily Telegraph, too. Note too the severe downside in the commercial property markets. Banks love to build big downtown skyscrapers for themselves and other financial institutions. What happens when the can no longer afford the space?
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POPSEconomic Crisis Looming: Bank woes, Stocks Drop, Consumers Pinched as Prices Up
Yet only one presidential candidate has been predicting this, and has criticized the Fed (and Congress for not managing the Fed) for printing more money, devaluing the dollar, which leads to price inflation, increased retail fuel prices, and the war-mongering against Iran increases crude oil prices to record highs. Consumers with higher oil and grocery prices (due to fuel and shipping costs) are left with less discretionary income, which WILL effect retails sales. These articles reflect that and report consumer confidence is down. Technically, by the numbers, there is no recession (2 qtrs of negative growth) but the military-industrial complex is keeping growth alive. Hint: This could be a sign of war with Iran...war (government spending in the defense contractors) drives economic growth (e.g. 1940s). (Then the FBI issues a statement and ABC says terrorists threaten to hurt economy, attack malls. Will that be the excuse for a drop in retail sales this winter?)
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POPSOil Is Well But, hey, don't forget the good news! Last week the stocks went UP and the Dow Jones has returned to pre-9/11 growth levels.
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POPSNews From The Financial Markets The FED cut the discount rate in an effort to rescue the falling stock market. This is good news for people with excellent credit scores but makes borrowing for those Americans with damaged credit more difficult. Many experts predict that over the next few months, there will be a great credit crunch. Watch for credit to be far more difficult to obtain and for subprime borrowers to be squeezed out of the marketplace. There is no better time than the present to think about restoring damaged credit.
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