BEYOND THE DOG DAYS OF SUMMER: AFTER AUGUST, REALITY
As Summer Ends, The Campaign Begins and The Challenge Remains

By Danny Schechter

Traditionally, time seems to slow down, I mean slooooow down, at summer’s end. The phone calls taper off along with the emails. We have now had endless gold medals and the Guns of August. Obama stirred his hoojie with his Biden moment, sliding into centrist field.  That’s done now.

There are but a few days of respite before the month goes from the quiet of the countryside to simulated excitement and high-flying convention oratory. As THEY wait to pounce; we wonder who will get the bounce?

Barack Obama accepts the nomination on the 45th anniversary of the March on Washington of 1963. He pursues his dream on the Day of The Dream.

Yet, another August day has a memory for me: August 24 1967, to be exact, That’s when my deeply missed pal, Abbie Hofffman and a band of fellow Yippies, threw money on to the floor of the stock exchange to mock the greed in full display below.

The Exchange later spent $20,000 to enclose the gallery which is now closed in keeping with post 911 paranoia. Abbie’s stunt was in its own way a protest against the crimes of Wall Street, and a prophecy of what was to come. Perhaps he foresaw the breakdown that the global economy is threatening us today.

Soon it will be Labor Day, a day for Labor in name only, and, then, we are off to the races. Everything will speed up. Politics will dominate, schools will reopen, and life will hurdle on into whatever abyss we are headed. Surge on o’ ship of state, surge on.

We do know that there are certainties however much we want to avoid or deny them. The economy will not be bouncing back any time soon.  The political race will get nastier, even more dangerous. Our wars will not end. And our press will not improve in an age when media snacking replaces real information absorption, much less digestion.

Behind the scenes, out of media glare, is the real battleground we rarely see, much less understand. It involves the agendas of elite power centers and key decision-makers, as Jessie Richard makes clear

“The battle over who becomes president does not take place (only) among the citizens of this nation, it takes place among groups such as the Council on Foreign Relations, the Trilateral Commission and the Bilderberg Group. Let me tell you something…the Cheney/PNAC cabal= stole the elections from George H.W. Bush, James Baker, George Schultz and associates, not from the Democrats. They are the ones who assembled the Bush administration and rigged the 2000 election to place them in power as a proxy presidential administration. The problem was that the Neocons, once in office, took control and did what they wanted to do, not what their sponsors wanted them to do.

Here is how it used to work. The media, which is controlled by the
real power brokers in this nation, have controlled elections in the
past by presenting and withholding selected information from the
public in order to influence their voting. By doing so, they pretty
much guarantee the outcome of an election. Do you think that if the
media did their job and actually informed the public accurately about
who George W. Bush was and what his qualifications were he would have
stood a chance of becoming a US President? This guy was less
qualified to be president than Britney Spears is qualified to be a
parent! ….

Maybe this is too harsh for you, too simplistic, too conspiratorial?  It pictures politics as the work only of forces in the shadows when in fact, as Mike Whitney writes, all of us have to do more soul-searching and introspection.

“America needs to spend a little time on the couch reassembling it shattered psyche and reconnecting with its inner-self. That means, sorting through the rubble of the Bush years and getting back to basics; a strong commitment to justice, human rights and personal liberty.”

Well said, Mike, but there are interests out there who like things the way they are, and are determined to keep them that way. In an era where the consumer economy is going to pot, they take refugee in the war economy which seems to be working overtime. I was surprised to find Paul Farrell’s article for Marketwatch reprinted on the Fox Business Channel site:

“There really is only one answer: “Deep inside we love war. We want war. Need it. Relish it. Thrive on war. War is in our genes, deep in our DNA. War excites our economic brain. War drives our entrepreneurial spirit. War thrills the American soul. Oh just admit it, we have a love affair with war. We love “America’s Outrageous War Economy.”

I don’t love it and I don’t believe we all do. Not at all.

Selling war is part of what our media culture does. When I used to work for ABC News, a list of staffers was referred to as “the troops.” Look at your neighborhood movie theater and see how many violent films are there. Athletic contests are spoken of with the metaphors of war. Ditto for political campaigns. Hooray for “Team America.” It should be Brand America.

In this August interlude, with many of us still in an escape or vacation mode, perhaps there is time to reflect, and to think about where we are headed and where we really want to go or be. We can’t control everything but on the other hand we can’t accept everything either.

Will we, when the “real world” resumes, hold out for what our hearts and our values tell us are needed or will we succumb to what we are told is the politics of the possible?

The latter all too often leads to rationalizing the unrationalizable and succumbing to the logic of the market and the conventional wisdom. That is the path to compromise and what often becomes self-delusioal. It leads us to suspend belief because we want to believe so much. Who wants to vote while holding your nose?

The challenge we face as the “new year” begins—once you have been a student, the New Year seems always to start in September—is to think about what really matters to us and for us. Yes, we need new political leadership, But we need more than that too. Do we ever!

To me the question and the need goes beyond party politics. It goes to how we work for a just economy, defend the vulnerable and assure more equality and fairness? Throwing money at the stock market has been done. Throwing heavier rules and regulations at Wall Street must be  part of a strategy for  the deeper changes that we really need.

That’s a tougher face-off than Dems vs Repugs. It’s  a collision with the real powers that be.

News Dissector Danny Schechter edits Mediachannel.org. His new book “investigating our economic calamity,” PLUNDER” (newsdissector.com/Plunder) is out next month. Comments to Dissector@medichannel.org

By Danny Schechter
Obama seems to have finally recognized that the economy is his issue. He lashed out at John McCain today for “not noticing” whats going on. Both candidates were criticized by NY Times columnist, economist Paul Krugman, for ignoring the issue. Meanwhile, the markets were crumbling as the real estate market remains in decline.

NEW YORK - AP: Wall Street retreated Monday after Fannie Mae and Freddie Mac fell to their lowest levels in nearly 20 years on concerns that the government might need to bail out the mortgage financiers. Weakness in the overall financial sector sent the Dow Jones industrial average down more than 175 points.

ARE BAILOUTS COMING?

The United States Treasury Department may soon be forced to broker a recapitalization package for mortgage giants Fannie Mae and Freddie Mac.

Not only will this move wipe out common stockholders, it may also leave preferred shareholders and others with losses.

The “recapitalization” plan is a failsafe in the case that the government-sponsored giants are unable to raise substantial capital to cover future delinquencies. This plan would act to reestablish stability in the nation?s two largest mortgage-finance firms, but it would do so while continuing to undermine our economy, thus only making the problem worse.

If the Treasury Department chooses to step in it will do so with revenue taken from taxes; and with no plan in place to increase taxes, any money redirected from the tax pool will equate to nothing more than deficit spending.

FINANCIAL TIMES: “Fears about the financial system grew on Monday as money market liquidity tightened and sharp falls in the share prices of mortgage financiers Fannie Mae and Freddie Mac led the US stock market lower. Fannie’s and Freddie’s shares lost 22 per cent and 25 per cent, respectively, after an article in Barron’s suggested that the US government was considering recapitalising the companies on terms that would all but wipe out existing shareholders.” …

MORE
http://www.newsdissector.com/

By Sharon Kayser

Usury, to be clear about it, is rich people taking advantage of poor people by lending them money on terms that are sure to make them fail - William Greid

It is often argued that times were a lot harder in the old days but this statement is far from true. Such an assumption rather tends to reflect on a poor existential knowledge and the superstition that a lack of control over the world events is beyond one’s own reach. Like any other species, humans get used to their own (predatory) environment and deal with it accordingly. Many dangers have become so familiar to the point to appear rather harmless. And then there is this infamous cultural thinking that “good will prevail” anyway. While lies always get exposed eventually, truth carries in its wake a series of painful realizations. It has always been a jungle out there and in this time and place, something has radically changed the fabric of society; something so insidious that goes far beyond ‘greed’ and which is so deeply entrenched that is repellent to the mind to even think of doing something about it. To put it bluntly, if something were done, chaos would occur instantly and of course nobody really wants this to happen. This is the main reason why we’ll have to wait until the system auto-destructs completely in order to finally envision the possible end of the tunnel and real solutions.

Although we’ve heard a lot about predatory lending lately, not enough about predatory borrowing was said and nothing at all about ‘predatory rumors’ without which the mania could never have existed. The ‘buzz’ is a major component that glued everything together and mesmerized everybody, even those who couldn’t afford a piece of the so-called American Dream. It is only when one realizes this, that the blame game is exposed for what it truly is. Back to reality: a study from the Center for Economic Policy & Research in Washington, DC. projected that the bust will mostly wipe out two decades of family-earned wealth. Who cares to listen now?

more

http://www.un-debt.net/

Why Are We All Complicit in Our Own Economic Servitude?

By Danny Schechter

Let me try a few words out on you: “Charge It:,” “Swipe It” and “Priceless.” You know exactly what I am talking about. We all have credit and debit cards. We all use them, and many of us keep our lives going because of them.

That is, until the bill becomes due.

The sad truth is that we are all complicit in our own economic servitude even if, at bottom, it’s not our fault because we live in a consumption society, and don’t feel we could live without them.

While many eyes are focusing on the housing meltdown and its hugely negative effect on an economy clearly moving into recession, few are paying attention to the next bubble expected to burst: credit cards. You would never know it by watching those slick VISA card ads on the Olympic TV broadcasts.

Combined with the subprime losses, such a credit card nightmare has the potential, experts say, of bringing down the entire financial system and global economy.

You and your credit card have become key players in the highly unstable financial crunch. Mortgage lender cupidity and bank credit card greed wedded to financial institution deregulation supported by both political parties, have been made manifestly worse by Bush administration support-the-rich policies. It has brought us to a brink not seen since just before the Great Depression.

While campaigning in Edinburg, Texas, in February, Barack Obama met with students at the University of Texas-Pan American. “Just be careful about those credit cards, all right? Don’t eat out as much,” he said. After the foreclosure crisis, he warned, “the credit cards are next in line.”

The coupling of home equity debt and credit card debt has gone hand in glove for years. The homeowners at risk can no longer use their homes as ATM machines, thanks to their prior re-financings and equity loans, often used in the past to pay off their credit cards. Indeed, homeowners cashed out $1.2 trillion from their home equity from 2002 to 2007 to pay down credit card debts and to cover other costs of living, according to the public policy research organization Demos.

To compound the problem, fewer people are paying their credit card bills on time. And, to flip the old paradigm, more are using high-interest credit card cash to pay at least part of their mortgages instead of the other way around.

Younger people are being crushed by this debt burden as college students and new consumers. Emma Johnson of MSN Money reports that “Generation Y” is broke

” “The democratization of credit has really generated a competitive spending culture, and plastic has allowed for material goods not had in the previous generation,” says Bob Manning, author of “Credit Card Nation. “Most of us grew up in a home with just one or two bathrooms for the whole family, he points out; today, new homes usually have at least one bathroom per bedroom.

“That change has happened so fast,” Manning says.

“This generation feels that somehow or another they’re going to figure out some technological advancement that’s going to get them out of their financial troubles and outsmart the market,” says Manning, who served as adviser to the documentary “In Debt We Trust.” The documentary paints a picture of national financial crisis stemming from the personal-debt burden.

Happily, this issue is finally being addressed by Congress and the Federal Reserve Bank. When asked for comments, the public overloaded the Fed’s website as the New York Times commented:

When the Federal Reserve asked for comments on its proposed rules on abusive credit card practices, an astonishing 56,000 poured in. Most were from outraged consumers. They told of interest rates skyrocketing when they paid an unrelated bill late. They complained of unwarranted late fees and pushed-up due dates. One Pennsylvania customer fumed: “I’m fed up with credit card company tricks that drive us deeper in debt.”

This anguished deluge should send a clear message to leaders in Washington. The Federal Reserve should swiftly adopt its proposed rules against unfair or deceptive credit card practices. But the real burden to curb these abuses falls on Congress

.

This discontent is being organized to press Congress to act by groups like the Consumer Federation of America and the Center for Responsible Lending

Congress is listening:

WASHINGTON (Reuters) - Legislation aimed at curbing credit card billing practices that surprise borrowers with unexpected interest rate increases and fees was approved on Thursday by a U.S. House of Representatives committee.

The bill approved by Financial Services Committee mirrors Federal Reserve proposals that would effectively end double-cycle billing — in which card companies reach back to prior billing cycles to help calculate the interest charged in the current cycle.

These reforms are a start but much more needs to be done because its not just billing practices that is at issue—its high interest changes, deceptive marketing, and arbitrary rules. On top of that, there are other loans that need scrutiny including payday lenders and student loans. And of course our own addiction to shop until we drop,

Also, let us not forget that our credit card companies have been colonizing markets throughout the world. As the NY Times explained in a series on debt, “As the American blessing of credit cards became widespread, so did the American curse of debt.”

Bear in mind the experience of another addicting industry—tobacco. As they came under restraints in the US, they escalated their poison pushing worldwide.

Debt is a global issue and has to be treated as such.

Just as groups like The Neighborhood Assistance Corporation of America (NACA) provide help to homeowners in distress we need a major effort to help the victims of credit cards—with practical assistance and political demands for regulation and relief.

News Dissector Danny Schechter made the film “IN DEBT WE TRUST. His new book PLUNDER: Investigating Our Economic Calamity is out later this month from Cosimo. Comments to dissector@mediachannel.org

Massive Economic Disaster Seems Possible — Will Survivalists Get the Last Laugh?

By Scott Thill,
July 26, 2008.
They used to be paranoid preparation nuts who built bomb shelters for a place to duck and cover during nuclear dustups with communist heathens, but their tangled roots go back to the Great Depression for a reason. If you want to get sociological about it, survivalism started out as a response to economic catastrophe. And now, with a cratering stock market, a housing meltdown that has devalued everything in sight, and skyrocketing prices for food, gas and pretty much everything else, survivalists are preparing for — and are prepared for — the rerun. In fact, they may be the only people in America feeling good about the prospects of a major crash.

And the interesting thing about the once-fringe movement at this moment in history is that survivalism has now gone green — at least in theory.

From peak oil and food crises all the way to catastrophic payback from that bitch Mother Earth, there are more reasons to hide than ever. Conventional society as we know it is already undergoing some disastrous transformations. Ask anyone ducking fires in California, floods in the Midwest or bullets in Baghdad. Maybe it didn’t make sense to run for the hills, stockpile water and food, grow your own vegetables and drugs, or unplug from consumerism back when America’s budget surplus still existed, its armies weren’t burning up all the nation’s revenue and its infrastructure wasn’t being outsourced to a globalized work force.

But those days are gone, daddy, gone.

MORE: http://www.alternet.org/workplace/92706

and

8,500 U.S. banks; many will die soon: click here http://www.dailykos.com/

By Danny Schechter

New York, August 4: We have all heard the line, ‘DA NILE is not just a river in Egypt.’ Denial can be a pervasive social and political phenomenon. Some of us just don’t want to know the truth or face its consequences. Maybe that’s why we envelop ourselves in national myths to survive. We want them to be true. Remember the slogan, “What, me worry?”

Take our worsening financial and economic crisis. It’s hard for many of us to believe its happening. The President keeps saying the economy is sound. Our credit cards still work. We have had recessions before and the system rebounded. Why not this time? Have confidence. Be positive. Stop all this “whining:” shut up, and things will get better.

That’s the kind of response I have had, even from progressives, to the film, columns, blogs and book I have been producing on these issues. A plummeting economy, failing banks, rising unemployment, rocketing inflation just does not seem to engage the way the partisan wars do. We live in a sports crazed country, and a celebrity obsessed culture. We want to debate personalities, not problems. We like red carpets and balance sheets in the red. Anything else is a, uh, bummer man.

When I made my film In Debt We Trust, some critics called it “alarmist.” While it exposed the subprime rape of so many communities, even though it understated the calamity that we are now confronting, it was still considered by some too “scary” or “negative.”

Some responded: “If people are deeply in debt, it’s their fault.” Who cares about all the slick marketing maneuvers by the big credit card companies? We don’t seem to want to know, as if the cultural zeitgeist mandates the mantra: ‘entertain us, don’t inform us.’

When I began sending PLUNDER, my book investigating this calamity, around to publishers there was a similar response, even though the market meltdown had begun. My patient and committed agent Victoria Skurnick made a serious professional effort to sell it, but the buyers, who all said it is well written, weren’t buying. They wouldn’t accept its analysis.

I soon found that the denial and distraction I encountered in trying to distribute In Debt We Trust was also in vogue in the book-publishing world. There, “business” books must conform to certain genres/templates and story telling trumps analysis.

Tips on how to make millions sell; polemics on how we are all losing don’t. People who are in the industry or comment on it — often TV “names” — have whole libraries of their books in circulation even though they have little to say. Just look at how much attention former Fed Chairman Alan Greenspan’s book received with nary a mention of his role in stimulating the subprime boom. (I even met the God-like authority on his book tour and he kindly signed a dollar bill for me!) Less well known “News Dissectors” and independents are not considered as part of these cognoscenti.

In a world dominated by markets, marketing makes the difference. One publisher I spoke to came right out with it: he didn’t think it would pass muster with the book buyer at Barnes & Noble. No B&N, no book!

Mine is a book about the economic bubbles that burst. What I have encountered in trying to place it are cultural bubbles that haven’t.

In the meantime, I continue to write blogs and commentaries about the threat of a further collapse of the system. Again, some responded by not reading my arguments, but rather ventilating at me with a stream of simplistic slogans.

Writes one: “This is so stupid. A lot of the problem is Americans as usual spending more than they have and the dumb banks who let them get away with it. I feel sorry for neither.” Never mind that individuals don’t have the power of banks nor often understand how they have been defrauded! Writes another: “… do you believe in God? Why? You’ve seen no proof of it. You don’t have to see proof of a thing to see its results or consequences.” Duh?

A third: “I think the media has to take a lot of blame for all the derogatory remarks written about the economy and this country day in and day out.” Huh? It was the media that took billions in ads from deceptive mortgage and credit card companies and never investigated their scams and schemes. This writer adds: “PLEASE….just once in a while, write about something pleasant and with good common sense.”

A fourth: “As usual you don’t have a clue, just fan flames. It is not Bush’s bail out, its your damn demagogs , (sic).. you know the jack asses. Imploding economy, really?”

Trillions lost, housing market in free fall, credit markets seized up, jobs gone, inequality deepening, etc. etc. Really? Yes, really!

A fifth comment, and the winner in this circus of denial: “You’re hysterical, and, worse - out of focus!! Try saying something new — and constructive.”

Right, even as this knee-jerk “critic” ignores my report on an organization’s constructive efforts to help 20,000 homeowners in distress.

Sadly, too many of us don’t want to hear it because to hear it is to fear it, and to fear it is to feel impotent to change it. Easier, isn’t it, to retreat into partisan certainties (or personal putdowns) without considering what that whopper of a just announced deficit will mean for any new federal programs in the future?

MORE: http://www.mediachannel.org/

Central bank body warns of Great Depression

(08/09)The Bank for International Settlements (BIS), the organisation that fosters cooperation between central banks, has warned that the credit crisis could lead world economies into a crash on a scale not seen since the 1930s.

In its latest quarterly report, the body points out that the Great Depression of the 1930s was not foreseen and that commentators on the financial turmoil, instigated by the US sub-prime mortgage crisis, may not have grasped the level of exposure that lies at its heart…. more

By Danny Schechter.

Where Are Progressive Voices On The Economic Crisis Wrecking America?

Boston, MA: The media reform conference was just starting in Minneapolis
when word bounded in from New York that the market dropped 394 points as
oil prices rose and, to borrow an Iraq war word, unemployment “surged.”
The number of unemployed people grew by 861,000 in May — rising to 8.5
million, a major jump even as the stats don’t count people who have
given up looking for work.

We need a National Conference on Economic Reform, and fast.

At the rate the markets are melting, President Bush, who has sought to
compare himself to Churchill and Reagan (and occasionally to Harry
Truman) when he is not being a divine messenger, may leave office with
the legacy of Herbert Hoover, the president who failed to foresee, much
less stop, The Great Depression. His faith-based remedies have backfired.

For reasons I have been grappling with, the economic crisis is just not
that compelling or sexy to the many progressives who are stirred into
action by every ugly utterance by Bill O’Reilly, or any partisan burp in
the war of words between Hill, Bam and Mac, to put the political race in
the language of the writers of the headlines in NY tabloids.

Cheering on political personalities or mounting one more issue oriented
e-mail campaign is certainly easier than confronting the economic and
power imbalances caused by the structural conflicts in our economy.

Knock, knock, people, I am sorry to intrude.

As one of the early organizers of the media reform battle, I haven’t
lost any of my passion about the campaign to stop media concentration or
keep the Internet free and the net neutral.

At the same time, the deeper crisis we are facing goes beyond a
one-track issue-oriented focus.

It is astounding to me how few of us discuss the way economic and
business issues are discussed, or connect with the fight against
foreclosures and growing economic inequality.

Last week, it was reported that l out of every 10 homes are at risk,
while we heard reports, OMG, about celebrities being affected in the
Hamptons and Beverly Hills. Actually, the foreclosure rate is the
highest ever recorded! The percentage of equity Americans have in their
homes is now below 50 percent.

We cannot assume that the economic crisis is covered any better than the
war, or electoral issues. In fact, just as our media was accurately
accused, by no less a manipulator than Scott McClellan, of being
“deferential enablers” on the war on Iraq, it played a similar role in
covering-up the build up of the subprime/subcrime problem. Many outlets,
engorging on ads from lenders and credit card companies, looked the
other way along with non-regulating regulators.

My own recent attempt to put the issue of financial news on the agenda
at the Media Conference was met with indifference.

The Democratic primaries only barely touched on the financial crisis.
There was far more buzz about sex, race, and religion than class and the
colossal rip-off by Wall Street firms who “securitized” millions of
mortgages.

Late last week, there was little uproar when Attorney General Mukasey,
ruled out any major investigation into the scams that the bankers
profited from. Some of us were too busy denouncing that other evil M -
Rupert Murdoch.

Where are the whistle blowers to expose a new wave of insider trading or
to focus on the role of speculators in commodities that has led to a
global food crisis? This has been reported – NYT: “Oil futures surged to
$138, fueling suspicions of a commodities bubble”— but not really
investigated.

While economic bubbles pop and others are created, many of us seem to
live in a bubble of denial and detachment from the machinations of
corporate power and how it is destroying the lives of millions of
working families.

For weeks, I watched and read many economic reports on how the economy
is coming back, (i.e. ‘we are closer to the end than the beginning’) and
the crisis is over, until it became clear that it wasn’t.

Economist Nouriel Roubini reported at week’s end:

“The complacency that took hold of financial markets - after the bailout
of the Bear Stearns’ creditors and the extension of the lender of last
resort support of the Fed to systemically important broker dealers – is
rapidly fading away as financial markets and financial institutions are
again under severe stress.”

Add to this, reports of mounting inflation, or that credit cards may be
imploding next or that oil supplies are, in fact, peaking, and, then, we
get a glimpse of a deepening crisis and a tragically incompetent response.

Mish’s Global Economic Trend Analysis adds:

“Furthermore, banks are tightening credit because they have to. The FDIC
is expecting a wave of bank failures. And then there is this not so
trivial problem of $5 Trillion Hidden Off Bank Balance Sheets.

Those assets will come back on bank books, and when they do it is going
to cause more shareholder dilution, and there will also be less lending.
This was the biggest credit boom in history fueled by insane lending
practices. A 30 year boom is not corrected in 6 months of pain.”

Some bankers are petrified. Mitch Stapley, a Fifth Third Bank Executive,
called this “A CRISIS OF BIBLICAL PROPORTIONS.” He added, “I’m not
talking New Testament biblical, I’m talking Old Testament hellfire and
brimstone. This is the worst credit crisis we’ve ever seen.”

According to Gerald Calente of the Economic Trends Institute: “the panic
is on”:

“Chain stores are closing, credit keeps tightening and economic
conditions are worsening. The government is going broke, the people are
broke, the nation’s fighting two costly wars and losing both … and the
President warns there may be more.

Avoiding intelligent discussion of the dire implications of the oil
shock, the next credit crisis and President Bush’s warnings that Iran is
a potential military target, the nation’s news has been focused on the
elimination rounds of The Presidential Reality Show.”

The information about what is really going on is there, if you search
for it. What’s missing for many people is what it means—the context and
background that enables us to connect the dots and think about what to
do. There are scores of financial bloggers out there, but many political
activists don’t know who they are.

What’s also missing so far is any serious fight back by politicians,
candidates, unions and progressive groups. Economic justice is now just
one of a long laundry list of issues. Bernie Sanders is talking about
it; Barack Obama should tune in. He’s been documenting the collapse of
the middle class.

The failure of the Congress to enact any measure for relief on the
foreclosure front or the Senate to pass a global warming bill
underscores the paralysis in Washington. It’s a check/checkmate
situation, pathetic but real.

President Bush has already said he needs a “magic wand” (honest!) to
stem the economic erosion. His administration helped create the problem,
but has no clue on how to solve it.

Help me answer this question I received from an Indonesian friend
watching the American political spectacle on CNN: “If Obama will be the
US president - what will happen - will there be any significant change
especially in regards to the economic collapse?”

What do you think?

Clearly, we have to pay more attention and ask ourselves what can be
done, what should be done and what we can do. We have to press the
politicians we support to push for economic justice.

The economy we save may be our own.

– MediaChannel News Dissector Danny Schechter made the film IN DEBT WE
TRUST (InDebtWeTrust.org) to warn of the crisis. He has just written
PLUNDER, a book investigating the economic calamity we are in. Comments
to dissector@mediachannel.org

Debt is control only when it is collectible. If the debtor has the legal or other means to resist “repayment”, debt is meaningless.

I’ve been thinking of this story for quite some time. I wanted it to reflect on my stance and pursuit to help Humanity at my own level. Bad economics being a great source of divide, I suddenly recalled the story of two pals of mine, in their late 40s, who might be heading for a divorce as I type this. Three years ago, their goal was to pay back these (damn) credit cards and they fully succeeded. They are not financially secure according to the mainstream standards: they live from paycheck to paycheck, even though being practically debt-free, and have a 401k (which could evaporate at any moment in a stock market crash). However for now is not bad at all considering that 80% of Americans have debts up to their eyeballs — the U.S Treasury included.

So what happened? Well, at the beginning of the housing boom, they didn’t have enough for a down payment and the husband lamented, thinking that he was about to miss the American Dream. There was also lots of peer pressure since he works in an environment of highly paid executives representing the top 15% of the society and of which he doesn’t belong to. It soon became an obsession: home ownership would never be for him. He was born a failure. The despair surely got worse when in the midst of the boom-mania, he was strolling down the streets with his wife looking at the new condos being built. Mesmerized and with a sad smile he explained for how much money those apartments were sold or flipped, assessing restlessly the equity lost for not taking part in this mega-speculation that was supposed to be endless.

From the beginning, she didn’t buy the exuberance and it turns out that current events prove her right. Today the stories about the housing market are unraveling, although the media are still gravely underreporting the situation. So, every time her husband was hypnotizing himself with ever-increasing home prices, she made a duty to lecture him and email him as many enlightening pundit’s views as possible to make her point. Even GE’s Immelt declared Housing Great Depression a reality. In despair she then armed herself with the U.S Constitution, which prohibits central banking as drafted by the Framers… The attempts to make her husband come to his senses remained futile. Her ‘out of control greed’ theory was first ignored then mocked and badly trashed. Remembering dotcom bubble stories, she wondered if the housing-mania was not mind-controlling him in the same way.

The justified gloom and doom data forwarded to him daily got on his nerves. He became irate, accused her of being obsessed with ‘an economic end of days’. He used guilt in turn, adding that if they couldn’t afford to buy a home, it was because of a lack of income whatsoever. The blame went on and on: instead of studying newspapers data, she should use her energy to come up with real solutions to earn more instead. Feeling rejected and misunderstood, bitterness fed her motivation to make her husband comprehend the dangers of denial.

His obsessions versus hers quickly became a philosophical issue; and this is precisely why they see a counselor today. It is very likely that the housing mania was a mere catalyst after all. Of course, they could have had enough for a down payment if not having maxed out their credit cards in the first place… but it recently surfaced that predatory practices are too pervasive in the ‘plastic industry’. Likewise, your life can easily become hell if you are not fully informed. They simply racked up so much credit card debt because companies had raised their debt ceiling systematically over a 5 year-period. To be fair, she remained more or less 3 years without a steady income, but nonetheless this didn’t prevent them from changing their spending habits. Until reality hit her like a freight train 5 years ago, they had copycatted the widespread mantra of ’shopping til you drop’.

“When you’re in a hole, stop digging.” David Walker, former U.S. Comptroller General and star of the documentary ,I.O.U.S.A

written by SB Kayser

Oh what a tangled web of deception… This time, you will not believe what you read - alas it is all true!
Bernanke lunched with Wall Street before Bear rescue, a Bloomberg.com headline says.

… The luncheon at the New York Fed gave Bernanke a chance to hear from chiefs of some of the biggest U.S. financial companies and hedge funds in the middle of his most tumultuous month as central bank chief. The meeting came hours after he announced plans to lend $200 billion of Treasuries in exchange for debt including mortgage-backed securities….

another reads: Volcker Says Fed Interventions Risk Political Battles

May 14 (Bloomberg) … Fed gets political with market interventions, Volcker warns… The Fed has created three new instruments since December to alleviate credit strains, including direct loans to nonbanks for the first time since the Great Depression. Chairman Ben S. Bernanke and his colleagues also aided the takeover of Bear Stearns Cos. by JPMorgan Chase & Co. and took on mortgage and other securities as collateral from securities firms….

But wait, its gets a lot worse:

May 12 (Bloomberg) — U.S. and European banks and financial institutions have “enormous losses'’ from bad loans they haven’t yet recognized… “Based on information I see,'’ it will take at least a year before all losses are realized, and some financial institutions may fail, Rubenstein said at a breakfast meeting of the Institute for Education Public Policy Roundtable in Washington. He didn’t name any companies….

HSBS leading the pack?

May 13 (Times.uk) Knight Vinke, the activist investor, launched a fresh attack on HSBC yesterday, accusing Europe’s biggest bank of flattering its US sub-prime losses by failing to write down $30 billion (£15 billion) worth of mortgage assets….

So, we understand the following move…

May 13 (Bloomberg) — Federal Reserve Chairman Ben S. Bernanke said financial markets remain unsettled and the central bank will increase its auctions of cash to banks as needed. While markets have improved, they remain “far from normal,'’ Bernanke said today in a speech to an Atlanta Fed conference at Sea Island, Georgia. “We stand ready to increase the size of the auctions if further warranted by financial developments.'’ …

Paul Volkers knows what comes next:

Former Chairman of the Federal Reserve Warns yesterday that the United States could face a 1970s-style period of skyrocketing inflation if investors lose confidence in the buying power of the U.S. dollar. “We are back in the 70s or worse if confidence in the Federal Reserve is lost. . . . If there is a real loss of confidence in the dollar, then I think we are in trouble. That is something that has to be watched,” Volcker told the congressional Joint Economic Committee… (May 15 2008)

Who is going to stop them?

(May. 12 - MSNBC) You probably thought nothing-down mortgage loans disappeared in the wake of the American subprime lending crisis, which has ensnarled much of the world in a credit crunch. They didn’t. Even more surprising, many Americans can still buy homes with nothing down thanks in large part to the federal government and a legal loophole that lets builders and bankers ensure a steady stream of asset-challenged borrowers for taxpayer-insured loans.

With quietly expanded powers, the Federal Housing Administration is already offering the next-best thing to nothing down on a house: a payment of just 3.0 percent will get practically any American with a pulse and a job a mortgage of up to $729,000, at least until the end of this year…. more

Let’s keep in mind the Maestro’s latest assessment…

(May 14 - MarketWatch) — U.S. home prices will likely bottom out in early 2009 after the market absorbs excess inventories, former U.S. Federal Reserve Chairman Alan Greenspan told audiences in Asia Wednesday, according to news reports. Greenspan, who spoke by video link to audiences in Hong Kong and Singapore, said the current pace of liquidation will accelerate, but excess supply won’t be eliminated until early 2009, according to Dow Jones Newswires.

Flash back…

“We’re not about to go into a situation where (real estate) prices will go down. There is no evidence home prices are going to collapse.”~~Alan Greenspan, May 21, 2006

So you will now know what to expect when you hear the word “economy”, won’t you? - Please dear readers, remember that when you’ll be voting… Is Who Becomes the Next President All That Matters? D. Schechter asks