Understanding the dynamics of economic and social systems is the key to preventing future travails. We all would love to avoid catastrophes, yet these things seem to always happen, like clockwork. We are now in the middle of the collapse of a World Order. All World Orders, new or old, are usually situations where one or two empires control world trade and finances, usually via military dominance. When these empires collapse due to accumulated war debts on top of ‘bread and circus’ overspending, we get chaos and a breakdown of the global consensus.
This is what is going on, today. When economists look at past economic events, if they don’t use the ‘imperial overreach’ prism to interpret what is going on, they get a very shallow understanding of elemental forces. US economists, in particular, struggle with this concept. It took many years to convince even some of them that the United States in an empire! Much less, a declining empire.
The ongoing collapse of the US floating fiat dollar regime has caused global trade to collapse. The US just this last 8 years, misspent the vast bulk of all our future capital on three very stupid things: the ‘war on terror’ which requires us to terrorize, torture and rape Muslims in distant lands, the ‘shop till you drop’ consumer culture that is now 70% of our GDP output and the ‘home ATM’ game which was used to fund the ‘shop till you drop’ consumer spending spree.
The US government has increasingly become indistinguishable from the ‘shop till you drop’ consumer culture. Instead of shutting down the bankrupt banking system, the US government and the privately-owned Federal Reserve are monetizing and privatizing everything by melding together, all public government systems with private banking consortiums and cartels.
Since our government was conned into buying up all the bad derivative-based products our bankers recklessly created during the bubble years, we now have to hire the exact same gnomic creatures who created this mess, to supervise and run the ‘funds’ the US taxpayers now ‘own’.
Treasury Announces Receipt of Applications to Become Fund Managers
under Public Private Investment Program
Washington, DC — The Treasury Department today announced the receipt of more than 100 unique applications from potential fund managers interested in participating in the Legacy Securities portion of the Public Private Investment Program (PPIP). A variety of institutions applied, including traditional fixed income, real estate, and alternative asset managers.
Good lord! This entire concept of ‘public/private’ is part of the total rot that is destroying our economic systems. For example, our military hires PRIVATE contractor guards to guard all our military bases! Our embassies are also guarded not by our proud military but by private, Praetorian guards beholden not to our government but to private owners, many of whom have headquarters in foreign countries.
Supposedly, this was going to save us money. All I see is spending run riot across all government agencies and we saved exactly nothing. But the loss of sovereignty is very significant.
Successful applicants must demonstrate a capacity to raise private capital and manage funds in a manner consistent with Treasury’s goal of protecting taxpayers. Treasury will also evaluate the applicant’s depth of experience investing in eligible assets. Finally, the applicant must be headquartered in the United States.
If the goal was to ‘protect taxpayers’ then the government should NOT have taken on these stupid things, in the first place. Indeed, the whole point must be, to OUTLAW these things so we don’t get stuck with them, again, in the future. And to PUNISH anyone who creates this sort of mess, not protect them.
Treasury expects to inform applicants of their preliminary qualification around May 15, 2009. Once a fund receives preliminary qualification, it can begin raising the expected minimum of $500 million in private capital that will serve as the investment that, pending further approval, will be matched with taxpayer funds. As we have stated previously, Treasury anticipates opening the program to smaller fund managers in the future, which may result in a lower minimum private capital raising requirement.
THIS IS WHERE THE PORK BARREL DEALS COME IN!!! Good grief, they will try to make it look like ‘minorities and women’ will benefit so the big banking houses that created this mess will insert their various tools who happen to be minority or female, into the government’s system so they can run this private/public Trojan Horse so it will actually be a looting machine.
Since announcing the program details on March 23, Treasury has encouraged small, veteran, minority and women owned private asset managers to partner with other private asset managers. On April 6, Treasury extended the deadline for fund manager applications to provide more time to facilitate these types of partnerships. We are pleased to see a number of creative partnership proposals among the applications we are currently evaluating.
Today’s announcement is the latest milestone in making operational the PPIP for legacy loans and securities, a key part of the Administration’s efforts to repair balance sheets throughout our financial system and ensure that credit is available to the households and businesses, large and small, that will help drive us toward recovery.
We will never recover if we try to do the things we are now doing. Changing course means changing direction. This means, we have to understand how we got in this fix before we fix it. The root causes are not last year nor the last decade. They go all the way back to the Vietnam War era. The creation of the floating fiat currency was not due to strength but to weakness. We did it to evade reality, not face reality. Just like the creation of the Federal Reserve was not about facing reality but rather, a coup by a bunch of bankers.
Goldman Sachs is finalizing a deal to hire Michael Paese to head its Washington office, according to lobbying and company insiders.
As the revolving door spins ever faster, we can see Goldman Sachs increasing their death-grip on the throat of the US political system. Like AIPAC, GS is not a friendly operation out to expand our economic power and political strength, it is a parasite operation set up to take over the host and turn it into a zombie.
Paese, now the executive vice president of global advocacy for the Securities Industry and Financial Markets Association, is viewed as “the capstone in an effort to reformulate the Washington office,” said a company insider.
I.e.: toss out the GOP corrupt political operatives and insert Democratic operatives. Turn on machine and continue forwards.
Paese is a big-name Democrat with deep industry ties and an inside Washington game who had worked for House Financial Services Committee Chairman Barney Frank (D-Mass.).
Paese would replace Ann Costello, a Republican who recently announced she’s leaving Goldman to run Bank of New York Mellon Corp.’s global government relations. Mark Patterson, who partnered with Costello to run the office before leaving last year to advise Barack Obama’s presidential campaign, is now Treasury Secretary Timothy Geithner’s chief of staff.
So, Patterson leaves his Goldman Sachs lobby cubby hole and moves back into government at Goldman Sach’s favorite perch, the Treasury. If you are going to loot something, go directly to the loot. I recall Obama claiming, he would not hire lobbyists to run the government. Another major disappointment.
Corporate earnings worldwide haven’t been the disaster analysts predicted as companies from Ford Motor Co. to Siemens AG beat earnings estimates through job cuts, factory consolidations and a dose of lowered expectations.
JOB CUTS improve profit margins. This is why factory closings and job cuts ravage the working masses while the corporations begin to flourish again. All the last 20 years, I noticed that if a corporation wants to see it stock rise, they announce job cuts! Whoopee.
This culture of job destruction is destroying the consumer class. Eventually, even Asia won’t be able to sell anything to us since we won’t have any jobs. Duh. This is why the news here is just more bad news, not good news at all.
“It’s one of those things where you walk away from the car crash and think, ‘Well, that could’ve been a lot worse,’” said Andy Lynch, who helps manage about $5 billion at Schroder Investment Management Ltd. in London. “The first quarter is marginally less catastrophic than feared.”
See how cruel gnomes are? Mr. Lynch is pure gnome. He…CRASHES THE CAR….then he WALKS AWAY….without hardly a scratch! What a miracle. Alas, he killed all the passengers in the car and all the people on the sidewalk and everyone in the car he crashed into! But who cares? He is just fine!
Some 188 members of the Standard & Poor’s 500 Stock Index have topped analysts’ estimates, or 69 percent of the 271 companies reporting so far. That’s more than the 62 percent for all of the previous quarter, Bloomberg data shows. In Europe’s Dow Jones Stoxx 600 Index, half of the 110 members reporting so far beat estimates, up from 38 percent in the previous quarter.
One reason is the low hurdle the companies set earlier this year by reducing forecasts, rather than any recovery from the deepest U.S. recession in a half-century, investors and analysts said. At the start of April, equity analysts estimated earnings among S&P 500 companies fell 37 percent in the first quarter. Six months earlier they had been calling for a 22 percent gain.
So, is the crisis over or is it entering a new stage? The news isn’t so wonderful, I think:
Economy minister Karl-Theodor zu Guttenberg said the slump was almost entirely due to the collapse of exports, insisting that a “global revival” will restore growth next year.
Germany and Japan had the #1 and #2 trade surplus profit margins in the world during the last 4 years. Both export a great deal of stuff to the US. Both were let slip by the US which concentrated on yelling at China because China exported more to the US than both Germany and Japan. But China’s PROFIT MARGIN was much less than the two WWII axis members.
Even this may be too optimistic. The International Monetary Fund expects a further 1pc contraction in 2010. Left Party leader Oskar Lafontaine said Berlin seemed to be hoping and praying that other countries would “pull the German economy out of the mud”, sitting on its hands as unemployment reaches 4.6m next year.
So, Berlin is praying that we will pull the German industrial machine out of the mud? HAHAHA. See how ‘free trade’ works? Tokyo is hoping for the same thing. This is ridiculous. The US allowed both to flood our markets and destroy our domestic industries and now, they want us to continue. This will eventually be impossible. The US can’t run up eternal trade debts just so we can let our trade rivals thrive at our expense.
Falling global demand for goods has hindered exports from the eurozone countries, dropping back to €99.2bn (£87.4bn), down 24pc on the same period last year. Imports fell by 21pc to €101.2bn, according to the European Union’s statistics office, Eurostat.
The eurozone typically exports more goods than it imports, but last year’s €1.7bn trade surplus swung to a €2bn deficit.
See? The eurozone exports more than it imports. The US imports more than it exports. This is pretty simple. The US can’t let this go on anymore. But then, the mantra, the religion of ‘how the Great Depression was made worse by tariffs and barriers’ continues to make it nearly impossible to talk about protecting the US from our eurozone allies.
This will happen here, too. Or we will do what Germany did in the previous Great Depression.
Milan’s financial police seized 476 million euros ($620 million) of assets belonging to UBS AG, Deutsche Bank AG, JPMorgan Chase & Co. and Depfa Bank Plc amid a probe into alleged fraud linked to the sale of derivatives.
The police froze the banks’ stakes in Italian companies, real estate assets and accounts, the financial police said in a statement today. The assets seized yesterday also include those of an ex-municipality official and a consultant, the police said.
The City of Milan is suing the four banks after it lost money on derivatives it bought from the lenders in 2005. The securities swapped a fixed rate of interest on 1.7 billion euros of bonds for a variable rate that was losing the city 298 million euros as of June. Milan is among about 600 Italian municipalities that took out 1,000 derivatives contracts worth 35.5 billion euros in all, the Treasury said.
And the Derivatives Beast is still eating everything in its path. It has not been either tamed or defeated.
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