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economy

Why Didn't They Think of That?

by: KathyinBlacksburg

Sat Apr 03, 2010 at 14:25:37 PM EDT

Cross-posted at Blue Virginia.

It has been nearly three years since the collapse of Lehman Brothers, and the related malfeasance of Lehman and other Wall Street firms.   Hank Paulson has admitted Lehman's balance sheet was bogus.  According to Robert Reich, Goldman Sacks helped Greece hide its public debt and then bet against it with credit default swaps, those risky derivatives, in the news so much in 2007-2009, to avoid risking its own capital.  If you think the scenario is familiar, think AIG.  By any stretch of the imagination, these overpaid and overfed hacks and flacks should have been left to suffer the consequences, stripped of their wealth and in prison.  Why hasn't this happened?  We have waited and waited for economic reform we can believe in, which Wall Streeters are fighting tooth and nail.  We've been told that we can't have the meaningful reform we crave, that we must accept "bipartisan" compromise.  The GOP slings its empty "free market" bull (bull, because they never actually mean a free market, but rather a rigged market, in practice). Then they blame an administration inheriting the effects of their party's utter lack of fiscal stewardship.  Now they fight reform to fix it and assure proposed re-regulation is toothless.  And of course, it's everyone's fault but their own.  The faux-helpless foxes at the SEC guarded the hen house then.  Even our own side has acted fairly helpless in the face of so many misdeeds. Should the administration not use the tools and methods available to it, it will deserve later scrutiny and judgment.  I reserve judgment for the time being. However, as Reich observes, it turns out that we do not need "reform" to do something about it.

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Michelle Singletary: Economic Empowerment

by: SumofChange

Mon Mar 01, 2010 at 20:37:58 PM EST

On Saturday, we were excited to join Yvette Lewis and Grow the Hope at the Millenium Bible Fellowship Church for an event on economic empowerment. Last time we joined them, it was quite a powerful event, so we came with high expectations. As usual, Yvette did not disappoint. We will have plenty of coverage of Majority Leader Steny Hoyer and the various workshops to help folks with resume writing and basic financial counseling. Today though, we are just releasing our interview with Michelle Singletary and her speech.
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Economic Empowerment à la Michelle Singletary

by: SumofChange

Mon Mar 01, 2010 at 20:34:49 PM EST

On Saturday, we were excited to join Yvette Lewis and Grow the Hope at the Millenium Bible Fellowship Church for an event on economic empowerment. Last time we joined them, it was quite a powerful event, so we came with high expectations. As usual, Yvette did not disappoint. We will have plenty of coverage of Majority Leader Steny Hoyer and the various workshops to help folks with resume writing and basic financial counseling. Today though, we are just releasing our interview with Michelle Singletary and her speech.
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Fifteen Voices and What They Want to Hear in Tonight's SOTU (I'm With Them)

by: KathyinBlacksburg

Wed Jan 27, 2010 at 19:20:48 PM EST

As news about the contents of President Obama's SOTU tonight leaks here, fifteen voices (including Elizabeth Warren, Rob Johnson and Eliot Spitzer and others) have told Huffington Post what they hope to hear tonight. Here is their wish list, in summary:

*Elizabeth Warren, Chair of the Congressional Oversight Panel, wants to hear the President make an aggressive case for regulatory reform.

*Robert Johnson, Senior Fellow and Director of the Financial Reform Initiative at the Roosevelt Institute, wants to hear that there will be sunlight surrounding the AIG bailout and all relevant correspondence.

*Eliot Spitzer wants a huge second economic stimulus because "10% unemployment is a human tragedy and a political disaster."

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My Two Cents: Senate Should Just Say "No" to Bernanke

by: KathyinBlacksburg

Fri Dec 04, 2009 at 12:25:13 PM EST

(It goes without saying that these are my thoughts and mine alone.)

Update: Here's some video footage, an Amy Goodman interview with Eliot Spitzer concerning Ben Bernanke.

"It's only mandatory, until Congress says it's not mandatory," he said at his reappointment confirmation hearing.  Reminding Congress that it has the power to repeal both programs, Fed Chairman Ben Bernanke implied that Congress should abolish Social Security and Medicare here.  Well, then, approving Bernanke is not mandatory.  

It's a shot fired across the bow of Americans.  5 trillion is savings and retirement "plans," have disappeared.  Seniors in their 70s and 80s are returning to work, if they can find it, because they cannot make it on Social Security.  This at a time when young people need jobs too.  And Bernanke says make their lives worse.  Meanwhile, according to Bernanke:

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Impression Management and the Deceptive Headline at CNN

by: KathyinBlacksburg

Mon Nov 23, 2009 at 05:00:00 AM EST

Here's another example of deceiving by headline, interestingly caught at headline news.  The cnn.com political ticker here, there's some real subterfuge, exaggeration (and deception).  Is it any wonder this network once brought us Glenn Beck and Lou Dobbs (or, at its sister station, us Nancy Grace)?


A CNN/Opinion Research Corporation survey released Friday morning indicates that 38 percent of the public blames Republicans for the country's current economic problems. That's down 15 points from May, when 53 percent blamed the GOP. According to the poll 27 percent now blame the Democrats for the recession, up 6 points from May. Twenty-seven percent now say both parties are responsible for the economic mess.

Given the epic economic collapse ushered in by eight catastrophic years of George W. Bush, and ignored even as many, many voices tried to bring Bush's unconscious mind into the "game," these numbers are far too damning of Democrats.  Giving Dems a year to solve such a massive collapse is absurd.  

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Here We Go Again: The New Pathway to Economic Disaster

by: KathyinBlacksburg

Sun Nov 22, 2009 at 10:45:30 AM EST

Some Democrats in Congress have called for the ouster of Tim Geitner and Larry Summers.  They are understating the case.  New information shows that Geitner and Summers apparent "cure" for the home mortgages disaster will force this nation to hang a new shingle on the nation's "house": Idiocracy.  (And you thought Sarah Palin was an idiot.)  That's the charitable way of looking at this financial scam.  If you really look at how they are "solving" this problem, you will see yet again just how disaster capitalism works.  

It is an ugly story, even worse, I am afraid, than the original debacle. Here's what they do. Investment firms buy mortgages They buy/take worthless mortgages (ones in default) worth face value (let's say) $100 million and discount them to $45 million.  They "slice and dice" them.  Some can be refinanced (about $40 million).  Others cannot ($60 million).  The hedge fund gives a "gift" to the hapless homeowner.  The hedge fund discounts the refinanced mortgage by 11%.  These loans are repackaged into bonds and resold.  The fund gets $35.6 million.  At this point the hedge fund only has to recoup $9.4 million more to get back its investment of $45 million.  But there's more potential in the $60 million than that.  Many properties are foreclosed and the profits returned.  Other loans are modified and held.  

What's wrong with all this, you ask?  Is kathyinblacksburg just being too negative (again)?  I say, "no," with some sense of irony.  You see there's more...(below the fold)

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Michael Moore's Brinks Job with Bankers in Tow

by: Rusty5329

Wed Sep 30, 2009 at 17:22:33 PM EDT

originally posted at Sum of Change

Sum of Change and Zej Media are proud to present to you, Michael Moore's Brinks Job with bankers in tow...

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A National Strategy Including Healthcare is Essential

by: Dan Sullivan

Mon Sep 14, 2009 at 07:48:11 AM EDT

( - promoted by KathyinBlacksburg)

Let's consider what happened to our economy without a strategy. Republicans pontificate on the economy and "free markets," but just review President Bush's strategy. Economic strategy, not tactics. Big bold direction, not pandering. Eight years without a rudder left us stranded on rocky shoals. That vacuous policy is documented for posterity in his National Security Strategies (NSS). Bush had two chances to explain his economic vision and he was, shall we say, indifferent:

"Ultimately, the foundation of American strength is at home. It is in the skills of our people, the dynamism of our economy, and the resilience of our institutions. A diverse, modern society has inherent, ambitious, entrepreneurial energy. Our strength comes from what we do with that energy. That is where our national security begins." (From the 2002 NSS)  

Well, that's possibly as vague a strategy as you can design and not leave any competent economist bent over laughing. Let's compare that to a portion of President Clinton's strategy:

Enhancing American Competitiveness

Our primary economic goal is to strengthen the American economy. The first step toward that goal was reducing the federal deficit and the burden it imposes on the economy and future generations...the federal budget deficit as a percentage of the (GDP) was lowered from 4.9 percent in (FY) 1992 to 2.4 percent in (FY) 1995 -- the lowest since 1979. And (FY) 1995 was the first time that the deficit has been reduced three years in a row since the Truman Administration. We are building on this deficit reduction effort with other steps to improve American competitiveness: investing in science and technology; assisting integration of the commercial and military industrial sectors; improving information networks and other vital infrastructure; and improving education and training programs for America's workforce...

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"If Everybody Doesn't Want It, Nobody Gets It"

by: Teddy Goodson

Sun Jul 12, 2009 at 19:22:52 PM EDT

"If everybody doesn't want it, nobody gets it" ---- Behold the true guidance for producing products and services under the American system of market capitalism, where the bean-counters keep a flinty eye on the quarterly bottom line, influencing most crucial corporate decisions, and where accountants are outranked only occasionally by the lawyers.  Don't believe me?  You think those overpaid CEO's with the golden parachutes make the big bucks because they are the risk-taking Deciders? Think again.

I know, I know, this does not exactly fit the picture of harmony and plenty presented to us, the wonderful world of consumer goods galore, a rising middle class everywhere, living in a heaven of endless growth.  The economic system that has lifted everyone's standard of living, producing a true Golden Age with ever-increasing gross world product is presumed to be scientifically based on the profit motive (greed), endless quarterly growth (regular short-term profits), free movement of goods around the world (free trade, globalization), and free decisions made by individuals in the open market on what they will purchase (market competition, the economic man), all of which results in the best allocation of resources through the mysterious hidden hand of the market. That is what free market capitalism is, the garden of entrepreneurs.  

Here's a fun description of a generic business operation (hypothetical, you understand) and how it grows in the garden of the entrepreneurial free market:

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Paving the Way for Repeated Economic Collapse (Again): Market Gamers are Undeterred

by: KathyinBlacksburg

Fri Jul 10, 2009 at 12:27:55 PM EDT

( - promoted by Teddy Goodson)

This morning (July 10) NPR reported that Treasury Secretary Timothy Geithner has placed the blame for the economic collapse squarely where he should have today: Unregulated derivatives.  Morgan Stanley has announced it intends to magically (my word) turn downgraded loan CDO into AAA bonds!  Poof!  Just like that! This very day, Goldman Sachs plans its return to its risky (unregulated) investment strategies.  And also this AM we learn on NPR that AIG will continue handing out their outrageous bonuses (for helping to wreck the economy). Someone in the White House or at Treasury must must step up and step in.  

As Danny Schechter tells us, you can read at GamingtheMarket.com that "markets are subject to, prone to and characterized by all sorts of manipulative practices."  Indeed, according to Reuters here a recent arrest over the July 4th holiday weekend, raises new concerns about just that.  One sentence will raise the hair on your neck:

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In Brief: The Shock Doctrine, One More Time

by: KathyinBlacksburg

Wed May 27, 2009 at 09:57:28 AM EDT

Gunning now for welfare (he's already reduced education in CA to a mere shadow of its former self), children's health programs, food stamps, an even state parks, Arnold Schwarzenegger has threatened the most far-reaching strike against the economic safety net since the Great Depression.  Here are two articles detailing what's on the horizon here, here and here.  

He may be "progressive" on a couple hot button issues, but here's where rubber meets the road.  And this has economic shock doctrine written all over it.

Naomi Klein's Shock Doctrine concept means using economic hard times, in this case economic shock, to swoop in and to wipe out the safety net.  The next step is extensive privatization of the last vestiges of institutions, infrastructure, and programs that help people in crisis.  When hard economic times spell disaster for Americans, he makes those most vulnerable pay the price.  This is contrary to assuring that those most likely to spend will pump money back into the economy.  So, it not only punishes the poorest of the poor, but also thwarts economic recovery.

[For details of the cuts, please read below the fold.]

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Green Jobs for Virginia's Veterans: An Essential Part of the Big Picture

by: Eileen

Sat May 23, 2009 at 08:00:46 AM EDT

Did you know that of the ten United States cities with the largest population of veterans, six are in Virginia (and more specifically Hampton Roads): Hampton (27%), Virginia Beach (22%), Norfolk (20%), Newport News (20%), Chesapeake (19%) and Portsmouth (18%).

Virginia also has tremendous potential for development of renewable energy, especially offshore wind development which ironically is also based in an area, Hampton Roads, that is home to so many veterans.  

While Brian Moran has long understood that it is a false argument to pit the environment against the economy, newer politicos needed some convincing of that. Fingers-crossed, but I think Rep. Glenn Nye (2nd) is starting to get it!

Two announcements from both Moran and Nye start the ball rolling towards Virginia's development of a clean energy economy. Moran announced Thursday his "Warriors to Work" initiative, a part of which puts veterans to work in developing our renewable energy resources. Nye announced Wednesday adoption of his amendment that helps veterans start and run their own businesses. Nye's bill was added to H.R. 2352, the Job Creation Through Entrepreneurship Act which also "establishes a green entrepreneurial development program, which will provide education, classes and one-on-one instruction in starting a business in the fields of energy efficiency, green technology, or clean technology".

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William Black and the Message We Keep Trying Not to Hear

by: KathyinBlacksburg

Wed May 20, 2009 at 09:51:09 AM EDT

If you watch Gritt TV (on Free Speech TV), Bill Moyers Journal, or Democracy Now, you've heard of William Black.  Otherwise, you may not, because the so-called mainstream media doesn't air much of what William Black has to say. Laura Flanders, of Grit TV, cuts right to the chase.  And the message is a stark one:

.


Deregulation is a dirty word today. But who and what allowed it to happen? William K. Black, former senior regulator during the savings and loan crisis tells us what he thinks happened and why the bailout is flawed. Black has argued recently that Wall Street's crisis could not have happened if not for illegal fraud and that triple A ratings given to bad loans amount to a criminal cover up. Black is the author of The Best Way to Rob a Bank is to Own One: How Corporate Executives and Politicians Looted the S&L Industry.

Black, who now teaches courses in detecting banking fraud at University of Missouri Kansas City, was also interviewed last month by Bill Moyers. The video is here.

The S and L scandal two decades ago involved an epidemic of fraud.  So today, fraud has catapulted our nation to the brink of collapse.  Black sees a recipe for disaster in three major ingredients:

• Massive growth
• Gut underwriting
• Extreme leverage

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News of the Day: Credit Card Reform Moving Forward

by: KathyinBlacksburg

Tue May 19, 2009 at 22:04:44 PM EDT

(we also need to actively change rules in states where credit cards are based, such as SD and DE.  One reason so many cards are based in such states is because of the lack of limits on usury in some cases
- promoted by teacherken
)

Passing overwhelmingly by the Senate (90 to 5), long awaited credit card reform promises to bring some good changes, but leaves others unaddressed. Additionally, due to the long lag-time before the bill would go into effect after reconciliation with the House version (expected to pass Wednesday), there is ample time for mischief by credit card companies.  Here are a few improvements the bill did take on:
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More Social Security Demagoguery

by: KathyinBlacksburg

Wed May 13, 2009 at 12:10:52 PM EDT

The Social Security demagogues are at it again.  They've gotten their talking points into the minds and mouths of most of the news anchors.  This time NPR got it mostly right.  Not so, CNN and others.  Following the release of the Social Security Trustees' Report here, Treasury Secretary Timothy Geitner said the following:


This year's Social Security Report projects that the Trust Fund will be exhausted in 2037, four years earlier than the Trustees projected last year.  This change is primarily due to the economic recession, recent data that prompted a small downward adjustment to the projected level of real GDP after the economy recovers and the fact that our citizens are on average projected to live longer lives. Nevertheless, Social Security can continue to pay full benefits for nearly 30 years, and cover approximately 75 percent of scheduled benefits thereafter.

Here's the link by Geitner.  Please re-read the last sentence in the quote above. While the first sentence in his statement is generally true, it's not clear.  He makes a more complete statement by the time you get to the bottom of the paragraph.  But some in the media are running with only the first part.  "It'll be broke!" they say simplistically and misleadingly.  

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Economic Lessons from a Virginia Poet

by: KathyinBlacksburg

Sat May 02, 2009 at 12:27:24 PM EDT

Wednesday the candidates for governor couldn't seem to articulate why the humanities are important.  Here's one reason why.  (I should note that I write today of only one avenue within the humanities for creating a well-rounded view of the world. There are so many others:languages, the arts, music, philosophy, literature, creative writing, communication studies, history, and many, many more.) Sometimes we as a society need a poet's sensibility, a poet's voice (or the philosopher's reflection) to focus us on the humanity in those around us. It is only in freeing ourselves from self-worry that we see what's really important and find the meaning that ushers in positive change.  And so words etched on paper cascade off page and into our minds and hearts.  

Most of us haven't experienced a recession or depression such as this.  We are in almost uncharted territory for most of us who are alive today.  We don't know what will happen next. As we rebuild our economy we must retain what is best of us.  It is in repudiation of what is most human that we as a nation arrived   in this place.  We overly-embraced bottom lines, justified shipping jobs like so many commodities off-shore.

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Under-reported: Several Apparent Suicides Among Financial Leaders of Embattled Institutions

by: KathyinBlacksburg

Thu Apr 23, 2009 at 11:25:57 AM EDT


Watch CBS Videos Online

First, the CFO of mortgage giant Freddie Mac, David Kellermann, was found dead of an apparent suicide in the basement of his home in Fairfax this week.  Here's the story.
But, it turns out, this is far from the first such occurrence.  

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How 401ks Are Selling Us Short and Impoverishing Many Americans

by: KathyinBlacksburg

Wed Apr 22, 2009 at 16:33:47 PM EDT


"At any one time, less than half of all workers are working for an employer who sponsors some type of employer pension," economist, Teresa Ghilarducci, When I am Sixty Four, p. 59)

In 2008 this same economist, wrote:


"If current trends continue, the early baby boomers (born between 1946 and 1955) will be the last generation with more retirement than their parents" (p. 56).  

Don't look now, but baby boomers' prospects have sunk like a stone.  A lot has happened since early 2008. With the economic collapse of personal savings and retirement accounts, and the by-design under-funding of defined benefit plans, boomers will be lucky to be able to retire at all.  

Americans are struggling.  Those of working age, worry that they will lose their jobs.  For many of them, retirement is too far away to think about.  Those who've lost jobs worry about jobs now.  But for those 50 and over, the devastation of the American retirement system looms more urgent.  And for those 60 and over, the timing could not be worse.  How we got here is a long story for another day.  But here's the short of it and a few solutions

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The Call

by: KathyinBlacksburg

Tue Apr 14, 2009 at 14:29:14 PM EDT

It's always the same.  The call comes from "unknown caller, most recently from 850-386-1643.  (Don't answer it.) I wouldn't answer calls from "unknown caller," except a couple people are so listed (as unknown caller)on caller ID.  I was awaiting a call from one of them.

A semi-hysterical woman says hello in an urgent voice.  Robo always says "this is an important call." OR "this is an urgent call."  Sometimes they now add, "Don't be alarmed, but..."  If you hadn't gotten these before you might be just that, alarmed.

Still, it's one day until April 16th.  Every time I get a robo-call, I stiffen, wondering if its the warning system at Virginia Tech.  My mind races.  But then I remember, it's an 850 area code (Florida).  Again.

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