The Complete Meltdown of Our Financial System

[Nbadan]

Really, what's left for Dubya's plunge team to do? If dumping a trillion dollars into the system doesn't do the trick, expect a catastrophic meltdown...



Congress Told "We're Literally Maybe Days Away From A Complete Meltdown Of Our Financial System"


September 20, 2008
Congressional Leaders Stunned by Warnings
By DAVID M. HERSZENHORN

WASHINGTON —

It was a room full of people who rarely hold their tongues. But as the Fed chairman, Ben S. Bernanke, laid out the potentially devastating ramifications of the financial crisis before congressional leaders on Thursday night, there was a stunned silence at first.

Mr. Bernanke and Treasury Secretary Henry M. Paulson Jr. had made an urgent and unusual evening visit to Capitol Hill, and they were gathered around a conference table in the offices of House Speaker Nancy Pelosi.

“When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”

Mr. Schumer added, “History was sort of hanging over it, like this was a moment.”

When Mr. Schumer described the meeting as “somber,” Mr. Dodd cut in. “Somber doesn’t begin to justify the words,” he said. “We have never heard language like this.”

“What you heard last evening,” he added, “is one of those rare moments, certainly rare in my experience here, is Democrats and Republicans deciding we need to work together quickly.”

Although Mr. Schumer, Mr. Dodd and other participants declined to repeat precisely what they were told by Mr. Bernanke and Mr. Paulson, they said the two men described the financial system as effectively bound in a knot that was being pulled tighter and tighter by the day.

“You have the credit lines in America, which are the lifeblood of the economy, frozen.” Mr. Schumer said. “That hasn’t happened before. It’s a brave new world. You are in uncharted territory, but the one thing you do know is you can’t leave them frozen or the economy will just head south at a rapid rate.”

As he spoke, Mr. Schumer swooped his hand, to make the gesture of a plummeting bird. “You know we’d be lucky ...” he said as his voice trailed off. “Well, I’ll leave it at that.”

NY Times

[Nbadan]

and the M$M and stock market disconnect...

Stocks surge as Feds act..

Wall Street rallies as the government moves to stem the financial market crisis. The Dow jumps almost 780 points in two sessions - the best run since 2000.
By Alexandra Twin, CNNMoney.com senior writer
Last Updated: September 19, 2008: 5:59 PM EDT

NEW YORK (CNNMoney.com) --

Stocks rallied Friday, with the Dow rising 369 points, as the government's plan to help rescue banks from toxic mortgage debt soothed investors at the end of a gut-churning week on Wall Street.

Treasury prices plunged and gold prices tumbled as investors bailed out of safe-haven plays and poured money into equities, reversing the flight-to-safety trend of earlier in the week. Oil rallied more than $6 a barrel. The dollar jumped nearly 2% versus the yen, but fell versus the euro.

The Dow Jones industrial average (INDU) added nearly 369 points, or 3.3%.

Including Thursday's big rally, the Dow's two-session advance was 779 points, the biggest since March 2000, according to Dow Jones. On a percentage basis, the two-session advance of 7.3% was the biggest since October 2002.

CNN

It's like the housing boom all over again, except this time, people are buying what could turn out to be worth-less stock....dumbasses...

[KenMcCoy]

A meltdown caused by a bunch of dirty hippy liberals who bought houses they couldn't afford...All this wouldn't have happened if the morons who took out the loans weren't so lazy.

[Nbadan]

Yep, while wall street gets a trillion dollar bail-out those hippy liberal get to live in tent cities...

In hard times, tent cities rise across the country
Associated Press
September 18, 2008

RENO, Nev. -

A few tents cropped up hard by the railroad tracks, pitched by men left with nowhere to go once the emergency winter shelter closed for the summer. Then others appeared — people who had lost their jobs to the ailing economy, or newcomers who had moved to Reno for work and discovered no one was hiring.

Within weeks, more than 150 people were living in tents big and small, barely a foot apart in a patch of dirt slated to be a parking lot for a campus of shelters Reno is building for its homeless population. Like many other cities, Reno has found itself with a "tent city" — an encampment of people who had nowhere else to go.

From Seattle to Athens, Ga., homeless advocacy groups and city agencies are reporting the most visible rise in homeless encampments in a generation.

Nearly 61 percent of local and state homeless coalitions say they've experienced a rise in homelessness since the foreclosure crisis began in 2007, according to a report by the National Coalition for the Homeless. The group says the problem has worsened since the report's release in April, with foreclosures mounting, gas and food prices rising and the job market tightening.

MSNBC

Way to blame the little guy....any chance you can find work with the McSame camp?

[Nbadan]

While Rome burns..

U.S. President George W. Bush (C) speaks at a ceremony in honor
of the 2008 NBA Basketball Champions Boston Celtics in the East Room at the White House in Washington, September 19, 2008.

It's like Katrina all over again, except this time, we all get screwed...

[KenMcCoy]

Yep, while wall street gets a trillion dollar bail-out those hippy liberal get to live in tent cities...

[b]In hard times, tent cities rise across the country
Associated Press
September 18, 2008



MSNBC

Way to blame the little guy....any chance you can find work with the McSame camp?

Lazy bas s should get a job.

From Monster.Com:

Reno, NV = 413 jobs
Seattle, WA > 5,000 jobs
Athens, GA = 123 jobs

Don't see how hard it is to get off their lazy asses and go find a job and get an apt.

[KenMcCoy]

And if you think it's bad now...wait til Obama raises business taxes..

[Crookshanks]

September 19, 2008
The Rest of the Meltdown Story
By Neal Boortz

What in the world is going on here?

You've seen the headlines, and you heard of the failures and buyouts. Lehman Brothers, Bear Stearns, Merrill Lynch, AIG; all big names and all in big trouble. Then those mysterious quasi-government agencies with names like Freddie and Fannie become wards of the state and you learn that you and your fellow taxpayers are potentially on the hook for tens of billions of dollars. At the end of the week Washington Mutual is looking for a buyer, and you start to wonder about the security of your own bank and your own savings account. Let's change that ad copy to WaMu -- boo hoo.

Somewhere in the back of your mind you understand that this is all tied somehow to bad mortgages. If you start reading a bit further to enhance your understanding you run into terms like Mortgage Backed Securities (MBS) and credit-default swaps, whatever in the world those are. Read further and you find out that a combination of falling home prices and mortgage defaults have put many investment banks and other financial ins utions in deep puddin'. All this reading, all this watching the talking heads on TV, and you still don't really know what in the world is going on here.

Fear not. I'm here to help. I know ... I'm just another talk show host; but the fact is that when the stage was being set for the problems we're seeing today I was making most of my money as a real estate lawyer .. closing loans for some of the very ins utions that are the tank today. This rather unique combination - closing lawyer and radio talk show host - gave me a front row seat to the politicization of mortgage loans that led us to today's headlines.

OK .. so we all know that a lot of really bad real estate loans were made. The political class would sure love for us to believe that the blame here rests squarely on "greedy" (try to define that word) mortgage brokers and lenders. The truth is that most of the blame rests on political meddling in the credit decisions of these mortgage lenders.

Twenty years ago the buzz-word in the media was "redlining." Newspapers across the country were filled with hard-hitting investigative reports about evil and racist mortgage lenders refusing to make real estate loans to various minorities and to applicants who lived in lower-income neighborhoods. There I was closing these loans in the afternoons, and in the mornings offering a counter-argument on the radio to these absurd "redlining" claims. Frankly, the claims that evil mortgage lenders were systematically denying loans to blacks and other minorities were a lot sexier on the radio than my claims that when credit histories, job stability, loan-to-value ratios and income levels were considered there was no evident racial discrimination.

Political correctness won the day. Washington made it clear to banks and other lending ins utions that if they did not do something .. and fast .. to bring more minorities and low-income Americans into the world of home ownership there would be a heavy price to pay. Congress set up processes (Research the Community Redevelopment Act) whereby community activist groups and organizers could effectively stop a bank's efforts to grow if that bank didn't make loans to unqualified borrowers. Enter, stage left, the "subprime" mortgage. These lenders knew that a very high percentage of these loans would turn to garbage - but it was a price that had to be paid if the bank was to expand and grow. We should note that among the community groups browbeating banks into making these bad loans was an outfit called ACORN. There is one certain presidential candidate that did a lot of community organizing for ACORN. I won't mention his name so as to avoid politicizing this column.

These garbage loans to unqualified borrowers were then bundled up and sold. The expectation was that the loans would be eventually paid off when rising home values led some borrowers to access their equity through re-financing and others to sell and move on up the ladder. Oops.

Right now this crisis is being sold to the American public by the left as evidence the failure of the free market and capitalism. Not so. What we're seeing is the inevitable result of political interference in free market economics. Acme bank didn't want to loan money to Joe Homebuyer because Joe had a spotty job history, owed too much money on his credit cards, and wasn't all that good at making payments on time. The politicians told Acme Bank to figure out a way to make that loan, because, after all, Joe is a bona-fide minority-American, or forget about opening that new branch office on the Southside. The loan was made under politicial pressure; the loan, with millions like it, failed - and now we are left to enjoy today's headlines.

So ... why aren't you reading the whole story in the mainstream media? Come on, are you kidding me? Do you really expect the media to blame this mess on deadbeat borrowers and political interference in the free market when it is so easy to put the blame on greedy lenders and evil capitalists? Remember ... there's an election going on. One candidate is decidedly anti-capitalist. Do the math.

[KenMcCoy]

So Nbadan...who signed into law the deregulation of banks??

[Shastafarian]

So Nbadan...who signed into law the deregulation of banks??

John McCain voted for some:

Mack (R-FL), Yea
McCain (R-AZ), Yea
McConnell (R-KY), Yea
Mikulski (D-MD), Nay

And just in case you read (HAHAHAHAHAHA) the WSJ article that stated Biden also voted for it. Well, that was just another lie.

Bayh (D-IN), Nay
Bennett (R-UT), Yea
Biden (D-DE), Nay

http://www.senate.gov/legislative/LI...n=1&vote=00105

[KenMcCoy]

Bill Clinton and the Wall of Me

Billionaire Sanford I. Weill, who according to Louis Uchitelle made "Citigroup into the most powerful financial ins ution since the House of Morgan a century ago," has what I call the Wall of Me leading to his office, which he has decorated with tributes to him, including a dozen framed magazine covers. A major trophy is the pen Bill Clinton used to sign the repeal of the Glass-Steagall Act, a move which allowed Weill to create Citigroup. Fittingly, Citigroup is a major contributor to guess which current Democratic Presidential candidate?

A Frontline report on the repeal of Glass-Steagall shows how those with money end up with pens from the President of the United States on their walls.

Sandy Weill calls President Clinton in the evening to try to break the deadlock after Senator Phil Gramm, chairman of the Banking Committee, warned Citigroup lobbyist Roger Levy that Weill has to get White House moving on the bill or he would shut down the House-Senate conference. Serious negotiations resume, and a deal is announced at 2:45 a.m. on Oct. 22. Whether Weill made any difference in precipitating a deal is unclear.

Just days after the administration (including the Treasury Department) agrees to support the repeal, Treasury Secretary Robert Rubin, the former co-chairman of a major Wall Street investment bank, Goldman Sachs, raises eyebrows by accepting a top job at Citigroup as Weill's chief lieutenant. The previous year, Weill had called Secretary Rubin to give him advance notice of the upcoming merger announcement. When Weill told Rubin he had some important news, the secretary reportedly quipped, "You're buying the government?"

When Bill Clinton gave that pen to Sanford Weill, it symbolized the ending of the twentieth century Democratic Party that had created the New Deal. Although the 1999 law did not repeal all of the banking Act of 1933, retaining the FDIC, it did once again allow banks to enter the securities business, becoming what some term "whole banks."

http://www.progressivehistorians.com...ge-crisis.html

[Clandestino]

and the M$M and stock market disconnect...

Stocks surge as Feds act..

[B]Wall Street rallies as the government moves to stem the financial market crisis. The Dow jumps almost 780 points in two sessions - the best run since 2000.
By Alexandra Twin, CNNMoney.com senior writer
Last Updated: September 19, 2008: 5:59 PM EDT




CNN

It's like the housing boom all over again, except this time, people are buying what could turn out to be worth-less stock....dumbasses...

do you invest in the market?

[bwdizzle]

A meltdown caused by a bunch of dirty hippy liberals who bought houses they couldn't afford...All this wouldn't have happened if the morons who took out the loans weren't so lazy.

Wait a minute now first off republicans and democrats alike have slowly been bribed and lobbyed by multi billion dollar corporations that slowly syphon rules and regulation thats supposed to keep our economy in check it's a full back hand to the face to set there and say it's the faults of the demecracts or liberals its all of washington fault and wall street.

[spurster]

Neither party has covered themselves with glory on this issue. I would like to see someone prosecute the bas s and es that got us into this mess. Mortgages are not supposed to be approved for people who can't afford them. Bonds based on bad loans should not be given sterling ratings. Credit should be backed by value, not by speculation or a maze of "credit swaps". $1 trillion is a of steal. The robbers should go to jail.

And you can trace back many causes to both Democrats and Republicans, but it happened on Bush's watch. His legacy will be a stupid, expensive war in Iraq and a massive, expensive takeover of bad loans, all added to the deficit and the taxes that we will have to pay sooner or later (tax increases in disguise). This pretty seals his legacy as about the worst POTUS in our history. I guess only Hoover will be beneath him.

[Nbadan]

And you can trace back many causes to both Democrats and Republicans, but it happened on Bush's watch.

I completely agree. There are many guilty Democrats too, but Norquist, Dubya and the Republicans promoted the era of deregulation and 'drowning government in a bathtub' that has led us down this road to near insolvency...

[Crookshanks]

I completely agree. There are many guilty Democrats too, but Norquist, Dubya and the Republicans promoted the era of deregulation and 'drowning government in a bathtub' that has led us down this road to near insolvency...

WRONG! It was Bill Clinton and Janet Reno and the rest of that bunch who forced banks to give mortgages to people who couldn't afford them.

And the democrats are in this mess up to their eyeballs! I cannot fathom why Chris Dodd hasn't been forced to resign - he's the biggest recipient of money from Fannie Mae and Freddie Mac. And it's Obama's financial advisors who cooked the books and made off with millions. Of course, Frank Raines is now going to have to pay back some of those millions.

You can't lay this at Bush's feet. And even now, what does the do-nothing, democrat controlled congress want to do to fix the problem? NOTHING! They want to just adjourn and let the next administration fix it. But President Bush has worked hard to come up with a solution.

This whole mortgage meltdown is another social project gone horribly wrong! And we the taxpayers got royally screwed!

[bwdizzle]

whats funny now is that our governemnt plans to bailout the bathtub with a teaspoon

[Nbadan]

Yep, even whats left of fiscally conservative Republicans see the writing on the wall...

WASHINGTON — Fiscal hawks who dominate the Republican Party's conservative wing have watched in dismay as President Bush , presidential candidate John McCain and Republican leaders in Congress fall in line behind a federal rescue mission of historic proportions.

Almost overnight, Republican lawmakers who came to Washington vowing to slash Big Government are powerless to stop what could be one of the largest government expansions since the Great Depression.

Sen. Jim Bunning , a Hall of Fame pitcher-turned-senator from Kentucky , threw a knockdown pitch Friday from the crumbling mound of fiscal conservatism.

"The free market for all intents and purposes is dead in America," Bunning said.

Yahoooooo

[SnakeBoy]

This isn't a republican/democrat issue. We've been headed down a dangerous road for almost 4 decades. The current wall street crisis is just a scratch and fix is just a bandaid. I have no idea how long we can keep printing money with nothing to back it up but simple economics dictates that you can't live on credit forever.

[bwdizzle]

[Nbadan]

Christopher Dodd on the meltdown...

[KenMcCoy]

The deregulation would have worked just fine if the PEOPLE that took out the loans would have paid their bills. Don't come back with...but, but, but, they didn't understand what adjustable rate interest only meant. They (the people taking out the loan) should have understood what they were getting themselves into.

Of course...both Obama and McCain know what the REAL problem is but they'll never say it.

[Crookshanks]

The banks and mortgage companies had criteria for determining credit worthiness. When the bleeding hearts decided to interfere and and demand that more minorties and low income people be given a "part of the American dream" is when this whole mess really got rolling. It used to be you saved for years to get a down payment on a starter house and then moved up as your income increased and you built up equity in your house. With this whole subprime market, people were not required to put anything down and it took them ages to build up any equity - so when the housing market burst, their homes were worth less than what they owed, the ARM's significantly increased their payments and people just bailed out.

So this little "social project" to help minorities really didn't help them at all - and it's going to cost us taxpayers BIG time! If congress was really serious about fixing this, a lot of people would be going to jail - and since this includes some of their cronies, it will never happen. They'll all just keep pointing fingers and blaming the other side - and Ken is right - NO ONE is going to come out and say that the people who took these mortgages are just as much to blame. After all, that would be terribly un PC. What a mess!!!

[Kamala]

And if you think it's bad now...wait til Obama raises business taxes..

Bush is now more of a socialist than any democrat I know with this trillion dollar move!:

[Shastafarian]

The banks and mortgage companies had criteria for determining credit worthiness. When the bleeding hearts decided to interfere and and demand that more minorties and low income people be given a "part of the American dream" is when this whole mess really got rolling. It used to be you saved for years to get a down payment on a starter house and then moved up as your income increased and you built up equity in your house. With this whole subprime market, people were not required to put anything down and it took them ages to build up any equity - so when the housing market burst, their homes were worth less than what they owed, the ARM's significantly increased their payments and people just bailed out.

So this little "social project" to help minorities really didn't help them at all - and it's going to cost us taxpayers BIG time! If congress was really serious about fixing this, a lot of people would be going to jail - and since this includes some of their cronies, it will never happen. They'll all just keep pointing fingers and blaming the other side - and Ken is right - NO ONE is going to come out and say that the people who took these mortgages are just as much to blame. After all, that would be terribly un PC. What a mess!!!

The deregulation would have worked just fine if the PEOPLE that took out the loans would have paid their bills. Don't come back with...but, but, but, they didn't understand what adjustable rate interest only meant. They (the people taking out the loan) should have understood what they were getting themselves into.

Of course...both Obama and McCain know what the REAL problem is but they'll never say it.

When in doubt, blame the poor people. God you people make me sick. Is there some blame to be placed on people who couldn't afford to pay back these loans? Probably. Is there a lot of blame to put on a government that is supposed to GOVERN its people? You bet your ass. People like you give conservatives a bad name.