TAXPAYERS ON THE HOOK FOR TRILLIONS IN BANK BAILOUTS
By Schuyler ThorpeAuthor and Political ActivistWhen Bush said that the Iraq war would only cost taxpayers $50B back in 2003; he should’
ve grabbed Cheney’s crystal ball and fast-forwarded the
real amount of the conflict by a factor of 3000; by presenting the American public in 2008 with a staggering bill that will reach anywhere between $1.3 trillion dollars and $3.2 trillion. (The latter used as a safety-net in the event that a future President Sara
Palin decides to stick it out in Iraq on the likelihood that John McCain kicks the bucket prematurely during his first and only term in office.)
So when the media and the government tells the people that we are only going to be on the “hook” for as little as $25 billion to $50 billion, I
wouldn’t be cashing in your chips just yet.
The true
staggering amount that the government will have to bail out one major institution after is far retching than just a small paltry amount revolving comfortably around the $25B or $50B number in retrospect.
Many of the banking institutions and mortgage lenders hold
trillions of dollars in holdings, liens, and treasury notes–which are being sucked down the hole of debt created by the foreclosure market meltdown.
Do you honestly
think that both the mortgage industry and the banking institution–which has been
deregulated by the Republican Party these last 8 years or more–will only be slapping each one of us
lightly with pitiful amounts of
accrued debt by the time all this mess is sorted out and taken care of?
Dream on.
The American taxpayer is going to be
screwed up the ass over the next couple of years or so–depending on how long this foreclosure crisis lasts–and be stiffed for hundreds of billions in higher taxes; just to cover the
huge losses incurred by the mortgage industry and possible
trillions tacked on by the failing banking system–as each major bank falls prey to sour and bad loans.
Then we have the credit crisis which has yet to be addressed. And when that costly endeavor is over too…?
There may not be much of an America left to by cheap beer with anymore.Schuyler Thorpe is an author, a political activist, and a frequent letter writer to The Everett Herald of Snohomish County. He can be reached at: starchildalpha1 at yahoo.comLabels: bailout, Federal Reserve Bank, foreclosure crisis, Iraq, media, President Bush, tax payers
GOVERNMENT AND FEDERAL BANK CLUELESS ON RECESSION
By Schuyler ThorpeAuthor and Political ActivistIf we all paid attention to what top economists and Alan Greenspan is saying–we’d be still waiting for the recession which has already gripped us all.
Forget waiting till the end of next year–when Greenspan’s forecasts suggest only a 1.5 percent GDP or less for the final three months of 2008–
look at what’s happening now.
Now is more important than trying to see into the future by a full year.
We are in the throes of a recession–whether the clueless Fed or the stubborn Bush administration wants to admit it or not.
10 months ago, preliminary housing data suggested a downturn which the Fed, the government, and Wall Street basically
ignored–despite persistent prodding from many outsiders to stabilize the housing market through sound fiscal intervention and a strengthening of the dollar–to give homeowners and the average American consumer reassurances and breathing room.
But they didn’t.Summer of the 2007 gave what many had hoped was a
wake up call to Wall Street, but that hope was short lived; as the fear melted away and stock brokers resumed their parochial fantasies that everything was still bright and peachy-keen.
Nevermind the fact that the dollar was steadily losing value and foreign investors were jumping ship left and right.
The Fed’s response in the next three months?
Drop interest rates–the single-handedly most
boneheaded move that the central bank could ever make!
The subsequent drops in interest rates haven’t made any difference on the housing meltdown or the credit crunch, but it certainly has made a
dramatic impact on the purchasing power of the dollar.
Basic essentials are now more costly than they were five years ago. With wages depressed and inflation reaching new all-time highs, living on what you have becomes more of a challenge for those who barely have enough as it is.
And oil and energy prices are continuing their staggering climb towards $100 a barrel, with $4 gas not too far off into the distant future.
But the government’s response to this?
Nothing to help America overall. Nope.
Just 220,000 homeowners out of the estimated 3.3 million that are affected by the housing crisis–based on a ridiculous plan that does little to assist the majority with their mortgage problems. (But what would you
expect from the Bush administration? This asshole government has been nothing more of a hindrance for the average consumer than a real-life godsend these days!)
And this trend is already having a devastating impact on the average consumer’s lifestyles.
With housing numbers falling to the lowest levels in 12 years, the cost of renting an apartment has skyrocketed dramatically; forcing many people to re-evaluate their place of living.
But the high demand for affordable housing may become a thing of the past; as tent cities have sprung up in some parts of the country–mainly because people on limited or fixed income cannot find a place to live.
Even those in foreclosure status may not be safe from the specter of becoming homeless themselves.
And the Fed’s new move for the new year?
More interest rate cuts. Not what this nation and economy desperately needs.
But tell that to the five banks whom (collectively) injected almost a half-trillion dollars of liquid funds into the US’s sagging banking system in an effort to shore up its loan and hedge fund operations.
Money isn’t what this nation needs to get back on its feet. It needs sound fiscal policy and responsibility. It needs the Fed to stop with its interest rate cuts and start shoring up the dollar.
Or this recession–which has gripped this nation for the betterment of the last five months or so–will only get progressively
worse, and not better as government officials are so optimistic about.
Schuyler Thorpe is an author, a political activist, and a frequent letter writer to The Everett Herald of Snohomish County. He can be reached at: starchildalpha1 at yahoo.comLabels: Bush administration, credit crunch, Federal Reserve Bank, government, housing meltdown, recession
THE DEFLATING DOLLAR VS. FED STUPIDITY
By Schuyler ThorpeAuthor and Political ActivistThe Fed is set to lower interest rates once again--which will more than likely drive stocks up on this. But sadly, the Fed is just trying to bail out investors, lenders, and borrowers from their own mess.
It's not going to do the economy any good when the government and the Fed are on the side of big money. These people who have been ensnared in these ARMs loans are just going to lose their homes anyway.
They can't afford the increased payments, and they certainly can't afford to keep their homes either.
One analyst said that Bush's mortgage bailout plan was essentially worthless--because it wouldn't stop what's happening with the housing meltdown anyways.
Just extends it.
Regardless of what the Wall Streeters says, this is going to have an adverse impact on our economy.
Sending it into recession.Lowering interest rates are just going to drop the dollar into the toilet further, forcing oil prices back above $90 and...well, start this whole mess over again. (Seeing how artificially low interest rates was the main culprit to this problem to begin with.)
The Fed already lowered rates twice already--thinking that was going to help--but once things snowballed, Bernanke jumped the gun and decided that a third rate cut is going to fix things.
It's
not.
It's going to make things much worse.
He says he's worried about inflation, and the idiot doesn't understand is that the
inflation he's referring to is core-index numbers. What he doesn't
see is the
inflation which has struck all of America in terms of the high costs of living and food!
Basic essentials are just going through the roof on price because the dollar has lost much of its value! It's putting a serious hurt on the average consumer.
And if you believe that things are hunkey-dorey in your neck of the woods, try taking a small amount of money--let's say $100--and go shopping for food.
Here's a list of things that I want you to get:
1 plastic bottle of ketchup (24 oz)1 jar of kosher baby dills (24 oz)1 jar of green Olives (10 oz)1 bag of chicken breast tenders (they're like chicken nuggets)
2 bags of mini pretzels1 jar of mayo (30 oz)2 bags of mixed vegetables with cheese sauce included1 bag of corn chips2 bags of chili cheese corn chips1 box of taquitas2 cans of pear halves2 cans of peaches (sliced)1 container of cottage cheeseReady for the end result?
My bill came to $40.27 after these purchases.
You would be left with $59.73.
Think
this is normal?
Wrong!This is what the depleted power of the dollar would get you.
Under normal circumstances, this list would only cost you $10 less if the dollar was
strong.But because of the
weak dollar, you are now having to spend $10-$20 more in basic essentials--just to make up the difference. And for each interest rate cut the Fed dumps on the market, you take another $2-$5 hit on your next purchase.
Because why?
The dollar is being weakened by interest rates--making it
less attractive to foreign investors and buyers. If you haven't figured it out by now, our major buyers of the dollar have been supplementing their currency reserves with other monetary denominators (like the euro). The Chinese have been. The Japanese are about to, and last I checked, Iran has dumped the dollar as a major trader in its oil market; supplementing it with another more stronger currency.
So as a result, it is now costing you and me
more money to buy things.
But why hasn't the government or the Fed acted on this information to boost the strength of the dollar? To keep it from collapsing?
Because they don't
care. It's not important to them--seeing how our national debt is being financed mostly by the Chinese and partly by the Japanese.
All they want is to keep the economy going for Wall Street and big business--no matter
what the cost it is to average American consumer! We are being
sacrificed for Corporate America here, people!
Wake up!But the sad part to this latter half of the story is this: We haven't
begun to pay off the interest to our staggering debt yet. And when we do in the coming years, it's going to take
three times the amount of money to pay off the first loan of interest.
So let's say that you've just financed a car and your first payment is $450--using the above scenario.
Under your terms of contract with the dealership and your starting interest rates of 3.9%; you would be paying an additional $175.50 to that normal amount each month.
But if the dollar continues to weaken further and further still, the amount of interest you would have to pay instead would eventually be $526.50--on top of that $450 a month.
Given what the Chinese are going to charge us for interest rates on a $9.3T debt...? It's not going to be pretty when the time comes to pay the Piper's first bill.
Not good at all.Schuyler Thorpe is an author, a political activist, and a frequent letter writer to The Everett Herald of Snohomish County. He can be reached at: starchildalpha1 at yahoo.comLabels: consumer spending, cost of living, Federal Reserve Bank, groceries, housing market, inflation, purchasing power, recession, US dollar, weak
