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BUSH RECESSION WILL SOON BECOME A DEPRESSION
President George W. Bush proudly congratulates Secretary of Treasury Henry Paulson on their new found Government stockpile of debt.
With 91% of Americans feeling our country is heading in the wrong direction ~ George W Bush has yet to acknowledge our present recession which will soon become a depression before he leaves office ensuring his legacy as not only the worst president of all time but also the most oblivious, irresponsible and unpopular president in our history: Allen L Roland
Not only has George W Bush brought down the US economy with his reckless tax breaks for the rich coupled with the celebration of unregulated corruption and greed ~ he has infected the global financial markets with his instruments of worthless debt.
As I have mentioned, the bailout was a politically motivated action to give the impression of action in a election year but the global stock market saw right through it and the Dow is now heading lower ~ probably to 7200 or below.
The full extent of damage has yet to be seen and Black October is just beginning ~ http://blogs.salon.com/0002255/2008/09/30.html
Martin Weiss, Money and Markets, who has been dead right on the economy for the past three years explains how the deepest declines are still dead ahead ~ " there are 1,479 U.S. banks and 258 thrifts at risk of failure with total assets of $3.2 trillion, 41 times more than estimated by the FDIC. This number alone illustrates the shock and awe ahead for anyone expecting the new bailout law to bring about a real recovery."
Allen L Roland http://blogs.salon.com/0002255/2008/10/09.html
Don't Expect a Recovery To Come Easily or Quickly. The Deepest Declines of All Are Still Dead Ahead.
Martin Weiss / Sinking Rapidly into Depression / October 6, 2008
" This is the crisis that will change the course of history. Even before ivory-tower theorists have gotten around to officially calling it a “recession,” the U.S. economy is already sinking rapidly into Depression ...."
http://www.moneyandmarkets.com/sinking-rapidly-into-depression-26412
Excerpt:
" A recovery certainly won't come from Washington's $700 billion bailout boondoggle. It's too little, too late to avert a debt collapse. At the same time, it's too much, too soon for all those who will be asked to pay for it.
For the evidence, see our white paper submitted to Congress on September 25. The highlights:
- The FDIC's list of problem banks includes only 117 U.S. institutions with assets of $78 billion. But the list has a fatal deficiency:
- It did not include any of the large banks that have failed or been forced to merge this year.
- Our list did. And that list shows there are 1,479 U.S. banks and 258 thrifts at risk of failure with total assets of $3.2 trillion, 41 times more than estimated by the FDIC. This number alone illustrates the shock and awe ahead for anyone expecting the new bailout law to bring about a real recovery.
- The government seems to assume that our debt problems can be resolved by focusing on banks with financial assets gone bad. But the reality is that bad debts are everywhere:
- At Fannie Mae, Freddie Mac, Ginnie Mae and other government agencies, $5.4 trillion in residential mortgages continue to rot.
- Beyond residential mortgages, there are $2.6 trillion in commercial mortgages.
- And beyond all mortgages, there are another $20.4 trillion in consumer and corporate debts ~ all subject to the same kind of surging delinquency rates we saw in subprime mortgages.
- The government's bailout plan is designed to help clean up debts that have gone bad so far. But what about debts that turn sour from this point forward? Do our leaders assume the economic decline is going to stop on a dime? Don't they see that the decline is actually gaining momentum?
- The bailout plan does nothing to address the $182 trillion maze of bets called derivatives. Nor does it take into consideration the fact that our nation's three largest banks ~ Citibank, JPMorgan Chase and Bank of America ~ are exposed to far more credit risk on their derivatives than they have in capital.
- In sum, even after committing $200 billion for Fannie-Freddie, $85 billion for AIG, $25 billion for the auto industry, $700 billion for the Wall Street bailout, another $150 billion tacked on to the plan for pork and tax cuts, plus hundreds of billions in emergency loans from the Fed ... the government's rescue is still too small to cope with the tens of trillions of souring debts and bets in a sinking economy.
- At the same time, the government's bailout commitments made so far ~ now exceeding $1.5 trillion ~ are already too much for those who will be asked to foot the bill or lend the money:
- Even before these bailouts, the Office of Management and Budget (OMB) projected the 2009 federal deficit would rise to $482 billion.
- Now, in just three weeks, the government has effectively chartered a course to triple that deficit.
- In practice, the only way the government can try to raise that much money is by borrowing it. And to the degree that it does so, the only possible outcome is huge upward pressure on the interest rates that consumers, corporations and local governments have to pay for mortgages and loans. That can't make the debt crisis go away. It can only make it many times worse. "
If you're not outraged, you're on life support !
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