America's Financial Crisis

[freakyfreaky]

Re: America's Financial Crisis

Could be a good time to be long on gold and short on the U.S. dollar.

[Sip]

Re: America's Financial Crisis

... And you are right, Japan, China, Germany, Saudi Arabia, etc., prolonged the inevitable, perhaps even made it much worst.

In any addiction scenario, you have the dealers and you have the junkies. They both benefit for a while until the junkie ends up in rehab (or worse).

[Armenian]

Re: America's Financial Crisis

The American Empire: Too Big to Fail?

Who gets bailed out – and who doesn't by Justin Raimondo

In reading about the federal bailout of all those financial wheeler-dealer outfits that are supposedly "too big to fail," the layman may be forgiven for failing to comprehend the intricacies of the arcane financial instruments currently backfiring on their whiz-kid inventors. Such exotic creatures as "credit default swaps" may elude the understanding of the hoi polloi, but one thing the man in the street does know: he'll never be "too big to fail," of that he can be sure. He's just not the Bear-Stearns type, and Congress would never shell out a penny before he loses his savings and his home, which – due to the propaganda of Panglossian economics, whereby houses stopped being homes and became investments – amount to pretty much the same thing. The paper-pushers of Wall Street made untold trillions out of a policy that was doomed to fail [.pdf] in advance, and whose critics have long predicted would end in precisely the manner our tale of economic woe is unfolding.

The policy of bank credit expansion, which enriches the already wealthy at the expense of the rest of us, has a fatal allure. It induces an initial euphoria, the false promise of permanent prosperity. This Panglossian view is the perfect economic system for an emerging empire, especially one with such inflated pretensions as ours. It is the economics of hubris – the same grandiosity that let us imagine we could implant "democracy" in the arid soil of Iraq and make the desert bloom. After the fall of the Soviet Union, the U.S. bestrode the earth like a colossus, America's stock was rising, and the pride that goeth before a fall imbued our leaders with the illusion that they couldn't fail. The American empire, they thought, is too big to fail. It's the end of history – and the rest will just be a mopping-up operation, that will be well worth the costs. The failed policies that led to our current economic predicament – the whole system of central banking and fiat currency – are precisely those policies that benefited those who are now demanding to be bailed out. They may have bankrupted the country, but you can be damned sure they aren't going down with the rest of us, no sirree!

This outrageous rip-off is mirrored in the foreign policy realm, where the very same crowd that dragged us waist-deep into the Middle Eastern quicksand are lecturing us from every podium. The neocons who brought us the Iraq war are directing John McCain's campaign, hanging on to power for dear life, shamelessly touting their alleged "success" even as the $3 trillion bill comes in and the people ask "For what?' These are the real dead-enders, the ones who believe that George W. Bush never implemented his self-proclaimed "global democratic revolution," but they will. The same foreign lobbyists who pushed for the overthrow of Saddam Hussein by U.S. force of arms have now turned their sights on Iran. The same newspaper columnists and professional know-it-alls who imagined that we would have a quick victory in Iraq – that it would be a "cakewalk," as one of the more arrogant neocons once put it – are still dominating the official discourse with their calls to action on this front and that. Bill Kristol, the little Lenin of the neocons, who made the Iraq war his vocation, was awarded a coveted pulpit on the op-ed page of the New York Times. Other people are demoted for advocating failed policies, but members in good standing of the War Party are promoted. They, too, are too big to fail. When the bill comes due, American taxpayers – and grieving parents and loved ones of the fallen – will have to pay, while the authors of our suicidal foreign policy get off scot-free.

The war profiteers aren't just the arms manufacturers, the Halliburtons, and the "private" international security firms who do the empire's dirty work. Key to the War Party are the intellectuals who gain prestige and real power over policymaking and public opinion on the strength of their reputations as paladins of interventionism. In some cases, these two types are embodied in the same people, Richard Perle being the exemplar. In any event, what's becoming increasingly clear is that the bailout brothers are all members of the same clan: think of them as a Mafia family, with a strict hierarchy of authority and command, albeit an informal one. At the top is the Don, finance capital, which controls the engine and sits at the dashboard pressing buttons according to a pattern: first inflation, then deflation, boom then bust, peace and then war again. But the bailout boys always parachute to safety before disaster envelopes the rest of us. Which is why failure only emboldens them. Our rulers really do believe their empire is too big to fail, but of all the would-be lords of creation, our own ruling elite may have the shortest reign – and the hardest fall. The engine that runs the machinery of imperialism is breaking down at key junctures, and the whole structure is teetering and creaking ominously, as if to presage the coming implosion.

For the truth of the matter is that the very bigness of the American Imperium, the sheer scope of its rulers' ambition, is precisely what is fated to bring about its downfall, and a very messy and painful descent it will surely be. As I relate in Reclaiming the American Right: The Lost Legacy of the Conservative Movement, during Rose Wilder Lane's eye-opening trip to the Soviet Union in the 1920s she met a Russian peasant who predicted, with perfect accuracy, the fate of the commissars some 70 years later: "'It's too big,' he said. 'Too big. At the top, it is too small. It will not work. In Moscow, there are only men, and man is not God. A man has only a man's head, and one hundred heads together do not make one great head. No. Only God can know Russia.'" The problem is that some men think they are gods. In the end, however, we will all pay the price for their hubris – the guilty as well as the innocent – as the American empire meets the fate of its Soviet predecessor, and for the same reason.

Source: http://www.antiwar.com/justin/?articleid=13489

[Armenian]

Re: America's Financial Crisis

Merkel Calls U.S. Irresponsible

The U.S. government was irresponsible in regard to world markets when it allowed its largest banks and financial institutions to operate without sufficient oversight, German Chancellor Angela Merkel said at a meeting of conservative leaders in Linz, Austria, the Associated Press reports. "Anyone who makes a real product knows how it is supposed to look and what standards are expected. In financial markets you also need to know what is being traded. Otherwise, things happen that we all end up paying for," Merkel said. Somewhat earlier, in an interview with German media, Merkel said that she sympathizes with people who wonder if the world economy is “fair.” Problems on the mortgage market and interbank crediting practically paralyzed the U.S. financial system earlier this year and caused a number of large companies to close. Federal authorities closed the IndyMac bank, with assets of $32 billion, in July. On September 15, Lehmann Brothers, one of the oldest American investment banks, filed for bankruptcy. The U.S. government nationalized major mortgage companies Fannie Mae and Freddie Mac to avoid the collapse of credit markets. Along with the bad news in the United States, a series of painful collapses began around the world. The Russian stock market was rescued from danger by massive financial support from the government and Central Bank.

Source: http://www.kommersant.com/p-13260/wo...onomic_crisis/

[Armenian]

Re: America's Financial Crisis

Integration into a global system is not bad per se. Trade and investment and the flow of capital should be encouraged and is in fact necessary in this mode of economics. The key for other countries was that they had relied too much on the dollar.

Well, that is why I made the point to Skhara that other nation are doing badly today (including Russia) because of their full integration into the global financial system which is lead by the largest economy on earth, America, and because of their dependence on the dollar. In essence, we have not had a free market economy. What we have had for a long time is 'one' economic/military/political/cultural superpower setting standards and trends for everyone else. The this superpower suffers so will the rest of the world. That is the fundamental problem I see. This is the fundamental problem we need to remedy. But things are gradually changing. Question is what will the resulting mess look like... And you are right, Japan, China, Germany, Saudi Arabia, etc., prolonged the inevitable, perhaps even made it much worst.

Too bad this man couldn't be president. Wisdom.

Wisdom, indeed. A great man. It's a total shame that the current system automatically rejects these types of individuals. He is also of a caliber the vast majority of Americans today will not and cannot understand. What a sad time for this country.

[ZORAVAR]

Re: America's Financial Crisis

Minister says Russia’s GDP up 7.7% in January-August

SOCHI, Sep 22 (Prime-Tass) -- Russia’s gross domestic product rose 7.7% in January-August, Economic Development Minister Elvira Nabiullina told reporters during an investment forum on September 20.

In August, GDP grew 7%, Nabiullina also said.

In 2007, the country’s GDP grew 7.8% in January-August and 7% in August.

The ministry is keeping its forecast for GDP growth in 2008 at 7.8%, Nabiullina also said.

In 2007, GDP grew 8.1%.

Source: http://www.prime-tass.com/news/show....id=0&id=444648

[Anonymouse]

Re: America's Financial Crisis

http://www.youtube.com/watch?v=3qLefrvxbq8

Too bad this man couldn't be president. Wisdom.

[Anonymouse]

Re: America's Financial Crisis

Not just America, not just Russia, the 'global' financial system is doing very bad because the world's financial system is integrated with that of America's, the world's largest economy. I find it funny that western media with the help of their branches in Russia are choosing to 'highlight' the bad performance of the Russian economy today. Although there is dead silence when it come to Russian news in America, I recently saw several reports on television about Russia's bad stock market. In reality, it is the Russian stock market that is doing poorly due to its integration to the global system and various other political factors stemming from the Russo-Georgian war. What's going on, why are they all of a sudden interested about Russia's economy? Anyway, the problem in Russia is their - stock market. Other sectors of the Russian economy are doing quite well. More importantly, unlike America's tens of trillions of dollars of debt and deteriorating dollar, the Russian Federation today is virtually debt free and the ruble is very strong. Russia's economic problem today is superficial, America's economic problems are profound and longterm.

Integration into a global system is not bad per se. Trade and investment and the flow of capital should be encouraged and is in fact necessary in this mode of economics. The key for other countries was that they had relied too much on the dollar. Had the main dollar asset holders like China and Japan dumped their holdings a long time ago, America would have experienced a turmoil by itself and it would have recovered, but now we have gone past the point of no return. This is going to be a worldwide depression.

However, what America has been reaping on the world is outright fraud. It's banking system is nothing more than a modernized mercantalism. Part of the problem is with central banking itself (and fractional reserve banking in particular) which the Federal Reserve is the final arbiter of the mystical power of setting the interest rate, which is responsible for these boom and bust cycles.

[Armenian]

Re: America's Financial Crisis

Russia is also experiencing a 'financial crisis'. Some say the worst since 1998: http://www.themoscowtimes.com/index.htm

Not just America, not just Russia, the 'global' financial system is doing very bad because the world's financial system is integrated with that of America's, the world's largest economy. I find it funny that western media with the help of their branches in Russia are choosing to 'highlight' the bad performance of the Russian economy today. Although there is dead silence when it come to Russian news in America, I recently saw several reports on television about Russia's bad stock market. What's going on, why are they all of a sudden interested about Russia's economy? In reality, however, it is the Russian stock market that is doing poorly due to its integration to the global system and various other political factors stemming from the Russo-Georgian war. Anyway, the problem in Russia is their - stock market. Other sectors of the Russian economy are doing quite well. More importantly, unlike America's tens of trillions of dollars of debt and deteriorating dollar, the Russian Federation today is virtually debt free and the ruble is very strong. Russia's economic problems today seem superficial and temporary, America's economic problems are profound and longterm.

[skhara]

Re: America's Financial Crisis

Russia is also experiencing a 'financial crisis'. Some say the worst since 1998:

http://www.themoscowtimes.com/index.htm