ENDING A WEEK OF WOE

THURSDAY UPDATE

Yesterday I cruised down Route 80 to the Poconos in Pennsylvania to screen my film In Debt We Trust and speak at East Stroudsburg University. It was a cold night. Snow was threatening but never arrived.

I didn’t know if I would get any turnout. When I showed up, there was a soldier in a camouflage outfit waiting in the lobby. He was an ROTC instructor and told me he and some his “troops” came because, as I show in the film, the military is also targeted by predatory lenders. He was a big fan of rightwinger Dave Ramsey who he was pleased to see in the film.

Blow the bugle, spread the word: the auditorium was packed and despite my computer breakdown blues and the overall frustration at getting folks riled up on this issue, the event went very well. That means only a trickle left after the film, and I was up for a night of preaching and teaching.

Students there are as worried about their loans and credit cards as are kids all over the country.

One woman in the crowd told me that 36% of the homes in the county were financed by subprime loans. I was delighted when the local TV station showed up as well as a young reporter for the Pocono Record. A big thanks for the University invite and the support of the Sociology Department and the Pocono Progressives.

When I woke up in the morning. I saw some headlines including “US Economy Slows to a Halt,” and “President Bush Says There Will Be No Recession.” Right!

Later I was told of W’s profound insight of the origins of the crisis. Write this down, As related to Ann Curry of the Today Show: “. . . I think this economy is down because we built too many houses.”

“WE” did, did WE?

My argument goes further, of course. And apparently The Pocono Record thought it had merit because they turned my appearance into the lead story on the front page of the paper. Get this:

Emmy-winning producer warns ESU students of U.S. credit ‘crisis’
By ADAM McNAUGHTON
Pocono Record Writer

EAST STROUDSBURG — College students and other Americans are being aggressively targeted by credit companies to create a growing culture of debt, an independent filmmaker said on Wednesday.

“This is something we really have to pay attention to because ultimately it will affect all of us,” said Emmy Award-winning producer Danny Schechter. “You can have every degree from a great university like this, it doesn’t mean you’re going to find a job if there are no jobs to be had.”

After the film, Schechter said that Americans are being tied down by mounting debt that is becoming harder and harder to get out from under and could eventually ruin the economy.

“This crisis has led to the transfer of hundreds of millions of dollars from the poorest people to the richest people,” Schechter said…..

I said alot more but he did get part of my presentation right.

Back in NY I learned that on that same way main funder of college loans in Pennsylvania was cutting back on student loans.

Now if I can only get a real campus tour going. I think we can spread this issue nationwide. I have a written proposal. I just need a funder.

I have often felt very alone on this issue, but to my surprise, more voices are coming out of the woodwork, and from suprising places.

GLENN GETS IT

CNN’s Glenn Beck whose arrogance and shoot from the hips provocations I find annoying most of the time is now coming around to the view that the economy is in deep doo doo.

He wrote in his CNNCcolumn yesterday:

“Less than a year ago, a recession was the last thing on anyone’s mind. In fact, over the summer, as I was questioning the conventional wisdom, I read an article on my television show that quoted a financial expert as saying, “It is the strongest global market that we’ve seen in the history of measuring these things.”

That’s when I realized how fast the herd was approaching the cliff.

But with predictions of a recession now more common than Fed rate cuts — and that’s saying something — maybe now it’s time to look at a worst-case scenario. After all, considering all sides of an issue, no matter how extreme they may be, doesn’t make you a crazy person; it makes you an educated one.

So to understand what a real meltdown could look like, I turned to Nouriel Roubini, chairman of RGE Monitor and professor of economics at New York University’s Stern School of Business. (He’s someone I also quote warning of a financial disaster.)

….Roubini believes that this will be a “very painful and severe recession” that could last for 18 months or more, but it will be more like 1981 than 1929. Families may be eating soup again, but at least it’ll be in their own kitchens.

Now, do I think any of what you just read will happen?

I have no idea, and that’s exactly the problem. I’m not an economist or a stockbroker; I’m just a guy trying to make the best decisions I can, and picking the brains of real experts helps me do that.

But I do know one thing for sure: Depressions aren’t advertised in advance. Last time around we went from the Roaring ’20s to bread lines in a matter of just a few years.

Anyone who says that can’t happen again either doesn’t know history, doesn’t understand how interconnected the world’s economies have become, or is lying to you. While that doesn’t mean you should panic, it does mean you should prepare — something my grandfather would’ve done a long time ago.”

Already many Ron Paul Supporters are expressing similar fears. Barack Obama told students in Texas the other day to be careful because credit cards may be next.

A word to the wise…..don’t ignore this crisis.

MY MAC MORASS

In my personal crisis, more readers are generously sending in contributions to the Global Center at 575 8th Ave #2200 NYC l0018 to help. Thanks to all of you. I am very touched.

Unfortunately, back in reality city, I learned today that the problem in my machine was that a “Seagate Momentus Drive” with a known high rate of frequent failures was driving my MacBook. (Apple is apparently not using them any more but too late for me.)

No one seems to want to accept responsibility for selling these lemons. The tech working on the machine sent my morale into the pits by telling me that he can’t recover my data and he doesn’t think a very pricey California firm that does specialized data recovery in “clean rooms” can do it either.

There goes a year of work!

I am going to try to see if we can extract some older data from an even older machine that succumbed to a Kernel Panic. I panicked when I heard about that.

So I am still machineless except for my office klunker. The lesson?

I will put it in caps so I will remember it: BACK UP YOUR DATA. (Beware: the tech also told me that sometimes the back-up drives fail too.)

I appreciate all the kind and even some of the not so kind letters.

Reach me at dissector@mediachannel.org

Wednesday Update: I missed Obama misprounouncing Massachusetts. It took me awhile to learn how to pronouce Worcester MA when I was there and it was longer than him. When you go to the Harvard Law School, you are in another state allogether. (Wooster!)….

I missed Hillary going on and on about what she will do on “Day One. She is becoming more macho than ever, and I wonder what military experience she has had. As much as George Bush, I am sure. Also chagrinned to see her posing with former NATO Commaner Wes Clark, the bomber of Belgrade…..My suspicious is that all the candidates will end up making hawkish noises. Does anyone mention the military-industrial complex any more? Certainly not our media?

Tim Russert has more fun showing off his pronounciation of Russian politicians and trying to trick/trip up politicians with a pkoy that has been used before. He really does alot of coverage of Russia, doesn’t he? He didn’t mention that the new PM to be, Mr M was in Serbia the other day criticizing US policy towards Kosovo..a policy shaped by the Clintonians. No mention of that!

On the economy front,

Not surprising to read that President Bush is siding with the banks and mortgage lenders and threatening to veto a Mortage Relief bill. Hasn’t he always sided with them and done their bidding? The sad truth is that many Democrats did too. Larry Summers, ex Treasury Sec says that bankrupcy reform could save 500,000 homes. This is the law that was already “reformed” as I showed in my film, with non-stop lobbying by the industry. Dems and Repugs supported it. It was a non-partisan disaster that is finally revealing its odiousness in the current crisis.

The Fed’s Ben Bernanke is about to cut interest rates again. Can anyone rember the reasons he gave last summer for not wanting to? How soon we forget! He said then he was afraid of causing INFLATION. Guess what, as the rates were slashed, inflation climbed. So this continuous rise in prices that we are experiencing in the grocery story and everywhere else is happening by design–a good way to transfer your money into the vaults of corporations and banks. Home prices continue to fall….no “fix” in site.

Gas expected to hit $4 a gallon. Greenspan is now urging oil producers to delink from the dollar. The dollar hit an all time low with the Euro. Is this just happening?

Don’t think so.

Fox Business Channel called today. They want to see In Debt We Trust–not to show it of course, but to see it. I guess if I can help educate the Fox Business Channel. I must rise to the task, even at my own expense.

Heard that the New College in San Francisco is in deep distress…..Just what we need: The loss of a unique progressive institution. I hope they can find a way to survive.

Now, back to my soap opera.

Some our readers are coming to the rescue with offers to help pay for the repairs I need and a backup device. Thank you. In this case manna came not from heaven but from Florida. Not sure if he can sign a check there in the dark.

Another reader kindly offers $300 if someone will match it. All donations are tax deductible to the Global Center via Paypal or by check to 575 8th Ave, Suite 2200, NY NY 10018..Thanks to all who are responding to this small problem in world terms but its pretty big for moi.

Still sidelined….lots to say but no technology to say it with…..I hope this older office machine is not going too….Feels creaky, won’t print.

Keep hope alive….mmmmm

Also, just as I expected. I wrote to some of the yokels who like to leave anonymous putdowns in the comments section of this blog, inviting them to have a real say or debate. They never respond…..

Off to speak at East Stroudsburg University in the Poconos Tonight at 7PM. (sorry ESU to misspell yr name as Stroudsberg)….

Hope to be back in action sooner rather than later

Danny

TUES UPDATE: , TekServ, one of the best Mac places I know in New York has my ailing machine– I think of it the way musicians think of their “axes”– but as I feared they would rather pop in a new hard drive than fix the one that is supposedly down and out. (”We don’t know why it happens, it just happens,” said their technie.) I am sure somebody may have been able to fix it another way, but I don’t know that somebody and haven;t mastered the mysteries of UNIX tools or Apple mechanics. They charge $600 to retrieve data as well with no guarantees,

Thanks to everyone who wrote to express concern and especially to the reader who offered a no-interest loan to help, but as anyone who has been reading my rantings on debt, I will have to pass on that one. So far, no donor/benefactor like Michael Anthony from the Millionaire TV show of old has materialized even as I read of good samaritans doling out dollars in the streets. Just not on the streets I prowl. (Smile)

A few items:

l. See my piece on a different type of Academy Awards show on Mediachannel.

2. Credit cards may be the next bubble. Millions are trapped in a plastic prison. But the companies are doing very well, thank you. VISA has announced a $18.1 BILLION dollar IPO. American Express revealed that it paid its CEO $53 million in 2007, twice what he was paid a year earlier.

Keep this high interest and fees coming.

3. Was distressed to read that Alex Gibney who gave a great speech at the Oscars when he won the best documentary exposing extra-rendition kidnappings by the US of innocent people has learned that the Discovery Channel which earlier agreed to run the film is now dithering. Hey Oprah, didn’t you just do a deal with them. How about using your influence to insure that this film will be seen!

4. There is more to the John McCain story. What issue was he being lobbied on and why. See Jerry Starr’s explanation. Also, shouldn’t we learn more about the lobbyist Ms. Vicki Iseman and her purported links to Israeli intelligence. Is that true? Is it relevant?

5. Have written a book on the financial crisis called WE ARE SCREWED drawing on all the articles I have written since the markets melted down. I deal with the failure of the companies, the regulators and the media. Word from some publishers is that is too unfocused or that I am not famous enough etc. They don’t like exercises that connect the dots more broadly. I keep saying this is NOT just a business story but affects all of us. Sorry……

This is an old story. Almost every important book–and I think this is one–was rejected repeatedly by publishers. I have a great agent. Anyone out there with contacts at a gutsy publisher? I have only had 8 books published up until now but that doesn’t seem to matter. This is only one of the most important crisis of our times. As Washington Post editor/columnist David Ignatious wrote yesterday: “The public, fortunately, doesn’t understand how bad the situation is. If it did, we might have a real panic on our hands.”

“Fortunately?”

I am also still trying to generate speaking gigs and screening dates. Just spoke up at Lincoln Center to some 600 British High School students in New York on a study trip. Tomorrow, thanks to the Pocono Progressives, I will be showing IN DEBT WE TRUST and speaking at East Stroudsberg University in PA. Hope I can beat the snow down there.

Still fighting the media war–and now the tech battle. I am writing from the office…..can’t do much more now.

Please stick with me/us. I tend to write at night because during the day I am too busy trying to keep our company afloat. And I don’t have a machine anymore to write on.

Some people want to use this occasion to ventilate their spleen and show off their vitriolic personalites by kicking me when I am down. I am losing patience with that because most have nothing to say of substance. I try to delete their spam posing as comments when I can. It’s not censorship by the way. All outlets decide what to publish and what not to publish. I do get thoughtful letters though that I am proud to run.

Here’s one.

Dear Mr. Schechter,

(Love the Dissector — I hope your computer is okay. :( )

You mention that “the majority” of these foreclosures are for single-family, owner-occupied homes. I’m wondering what your data says about the exact percentage. I’ve heard and seen several things which indicate that many applications for the high-risk types of financing were riddled with falsehoods, and that claiming the property to be purchased as “sf-oo” was a common practice because underwriters liked to see that phrase. According to a real-estate agent friend, however, the truth is that these loans were taken on properties meant to be turned over for quick profit. According to what she claims she saw, the motive behind
taking out the risky mortgages (no money down, interest only, 3-2-1 buydowns, NINA’s, stated-income, etc.) was that the initial monthly payments would be low so that the speculator would not have to pay much before turning the property over for a profit. The “high-risk” types of loans also meant that even if an investor could qualify for a traditional low-risk loan, everyone involved in financing the transaction was able to take away the maximum amount in fees, etc. from the origination of the
high-risk loan.

I’ve seen articles like this one:
http://money.cnn.com/
and
http://www1.pressdemocrat.com/

Reading between the lines leads me to believe that maybe what my friend is saying may be true. (If borrowers were encouraged to overstate their incomes, perhaps they lied about their intention to live in the home as well… could they have simply been waiting for prices to go up as they had been?)

The problem when the bubble burst, though, is that speculators can now no longer sell the properties due to a glutted market and have simply stopped paying for them. That’s what my real-estate broker friend is telling me — “a larger percentage than we know about” of these foreclosures are happening to already-vacant properties according to her. Folks like my husband and I, who took out a traditional 30 yr. mortgage during this time, live in the home, and have had no significant change in circumstances throughout this time (even though our property value has dropped 20,000 in the last five years) are still paying for our homes. Is the idea of “not paying for the roof over one’s own head” an option in reality? (We had no money to put down, and used the now-vilified AmeriDream program.)

Do you have stats on how many families are now homeless as a result of this? Is the media stifling an outcry from government agencies and charities now strapped for resources to deal with the (invisible?) wave of newly-homeless families? Why are banks, etc., frantically offering re-fi options, but I’ve heard that few are taking them even with lower interest rates? All of this makes more sense to me if what my real-estate agent friend says is true — that the “sf-oo” tag on these loan applications was a lie and these bad/risky loans were used as part of a profit-generating mechanism on speculative vacant properties.

I’m just wondering if you can help me make sense of this. I’m not trying to be disrespectful of “Sam and Sally Smith from South Bend” who are now losing their home to foreclosure. I just don’t get it. The MSM narrative is that ignorant-poor-people took out risky loans they should have known would be unaffordable for them (and are, in the process, toppling the largest economy on Earth! Shame on those poor-people!). Could it be the other way around — people with plenty of assets were trying to get even more? Perhaps now that it’s apparent they can’t get even more, the better option for them is to let the loans default and make the banks, insurers, and most likely — taxpayers like my husband and me suck it up?

You’ve educated us all on so many aspects of this implosion. What information might you have pertaining to the validity of my questions?

Thank you for your attention,
Cathy Collins, Columbus, OH

BACK TO MY MONDAY POST

Welcome to my nightmare. I won’t bore you with the details but my latest
MAC has crapped out, only a year and a month after I bought it to replace
the last one which died in a Kernel panic. This time, for reasons
unknown, the hard disk with all of my data–only some of which was
backed up–let that be a lesson to you and me (again)– is gone. Of
course, I blame myself but I can’t help wondering if these computers
aren’t built like cars to fail. At least there are lemon laws protecting
car owners.

So the machine is out of commish for the week….Maybe it’s a sign to
slow down. When you work as we are forced to do on the margins, with
little tech support or new technology, shit happens. Over and over
again. I am trying to avoid a psychic breakdown alongside this
unpredictable meltdown.

I can only hope my Apple Care policy covers it or I may be out of
commission for longer than a week. You always hope that just by
announcing this horror in the life of anyone like myself tethered to
technology, some manna in the form of a new machine will fall from
heaven but that rarely happens.

So, through no fault of my own or perhaps every fault of my own, I found
that even a MacBook can’t handle the daily Word count.

As a result I can’t share my dissections with you today or may be this
week including my full comments on Ralph Nader announcing that he is a
candidate on Meet The Press.

Tim Russert kept referring to it as an exclusive even though Nader
actually announced before the show and the story was making news. His
critique was of course trenchant with lots of truth and “context” to it,
but I don’t think campaigns or movements can just be organized by a
website or an individuals ego/drive. There wasn’t even the pretense of
the Green Party, no constituency except celebrity.

Incidentally, he is right about not causing Gore’s loss in Florida,
See my film COUNTING ON DEMOCRACY for all the screw-ups of the Democrats
there, but that doesn’t make this candidacy right. I am afraid the
Republicans will fund it hopes of derailing whatever candidate the Dems
put up. As much I respect Ralph’s great history and committment to
democracy, there was something sad about the spectacle of his one man
against the machine mission.

In other news, Raul was named predictably to replace his brother in
Cuba, and the US government is hypocritically and falsely accusing the
Serbian government of instigating the riots which were predictable given
US policy vis a vis Kosovo.

What most of the media fails to see that while the protests took place
at the US embassy, they were really aimed at the Democratic goverment
which was just narrowly re-elected and is now being undermined by the
very West it pledged allegiance to…

Add, i was going to discuss of the loss of $1.2 billion USAF plane as
part of this Administrations military record but I won’t.

I will end here rather than grouse on.

To comment, offer ideas, or provide material assistance, write me at
this email:

dissector@mediachannel.org

DANNY SCHECHTER
NEWS DISSECTOR