Comments on: Clinton: Let Greenspan Help Decide Whether to Rescue Home Owners

By: SueN

SueN — Tue, 25 Mar 2008 07:12:05 +0000

“Of course, because the suggestion comes from Hillary, it must be pilloried in the most excessive language possible.”

Indeed. If this had been a suggestion from Obama some people would be singing hosannas here about his sagacity. With the deep financial crisis that is besetting us, it would be foolish not to avail of all the best economists in the country, including the Obama supporter, Volcker, and the occasional Obama critic, Krugman.

By: goldstandard

goldstandard — Tue, 25 Mar 2008 00:44:48 +0000

How much more insane a suggestion could Clinton come up with as in floating the idea of having Greenspan oversee anything other than the geriatric set palying shuffle board in Miami?
What we are witnessing, through the now-failing obscene use of derivatives, is the entrails of the prolonging of failed fiat money system which began its decay when the world was forced onto a pure fiat money system with President Nixon’s revocation of the Gold Standard in 1971.
ALL FIAT CURRENCIES COLLAPSE, because the debt that they represent grows exponentially, eventually overwhelming the ability of any economy to even pay the interest on the debt. This is why interest rates are declining towards zero. Eventually, even interest rates of .1% will be too high to pay and the defaults will implode the financial system. Notice that I did not say the defaults would implode the economy. That will still stagger on, because that is operated by people whole trade real goods and services. It’s the financial system that will disappear and be replaced by honest money.
Clearly the system is collapsing now. Last week’s drop of 12% in gold is a sign of instability in the paper system, not a vote of non-confidence in real money. The sell off was contrived by the monetary interests and I expect it will have unintended consequences. For example, taking gold down, means that the perceived value of the US dollar and other paper currencies are raised. But, the problem with taking the price of gold down by raising margin hugely is that the powers that be may have forced any number of hedge funds [or dealers that behave like hedge funds] that were long gold and silver towards bankruptcy.
To save themselves these hedge funds may be forced to sell CDO’s and other derivatives that are already illiquid. The values of these derivatives which had been in limbo will be exposed as worthless, and that in turn may expose banks who hold this stuff on their balance sheet as visibly insolvent. It is the rule of unintended consequences biting the manipulators on the butt. Nobody out there understands the complexity of the derivative markets. It’s an immense financial domino system, and the plunge protection team may have just tipped dozens of dominoes over. Their collapse is doing to spread and widen until it reaches right back onto the balance sheets of the money center banks. The Fed is going to have to monetize trillions of this crap to stop the dominoes of failure and that’s going to kill the dollar and the rest of the fake money out there.
All fiat money is debt. Debt charges a percentage interest rate. All percentage rates generate exponential increase. In time even the smallest percentage interest will exceed the entire economy’s ability to pay.
In our world banks create the money we use out of thin air and charge us 5% per year to use it. Eventually the banks end up owning everything and the people are universally bankrupt. It’s a form of slavery.

By: earlofhuntingdon

earlofhuntingdon — Mon, 24 Mar 2008 20:02:32 +0000

Nothing improves the pithy, “Ignorance is curable, stupidity is terminal.”

By: SanderO

SanderO — Mon, 24 Mar 2008 20:00:05 +0000

Get white collar criminals and put them away!

Their crimes hurt millions of people not just the owner of a bodega who got robbed.

By: clamberite

clamberite — Mon, 24 Mar 2008 19:28:20 +0000

Let’s start by putting some of these fuckers in jail, then let the market work. The Repugs are always carping about too much regulation, but take it away and it always turns out this way. The law however, should be our backstop for all this. The problem is that they always, for the most part, get away with their perfidy. Let the cows come home for a change and this shit will stop. I would sure like one of the candidates to state: “When I am President, I will direct the Justice Department to make it a priority to find the lawbreakers and put them in jail. The days where someone can cost regular people billions of dollars in losses while they waltz off with millions in bonuses is over!” THAT is the candidate who will win the election.

By: DWBartoo

DWBartoo — Mon, 24 Mar 2008 19:14:29 +0000

The not-early ‘onset’ of political dementia has, seemingly, achieved widespread contagion.

The only known pallative is knowledge and the wit to make use of it.

Examples are sorely lacking, these days…

By: earlofhuntingdon

earlofhuntingdon — Mon, 24 Mar 2008 19:02:28 +0000

Mrs. Clinton suggests appointing Alan Greenspan to a Housing Commission. Its task would be to ameliorate the ~~“subprime”~~ national housing crisis - primarily with the interests of homeowners, not their lenders, in mind. Presumably, that’s because it will be homeowners’ “blood, toil, tears and sweat” - either directly or through their tax dollars - which repay those mortgages, and the securities into which they’ve been incorporated and sold worldwide, at immense profit, by the likes of Bear Stearns.

Mrs. Clinton’s suggestion is the New Yorker cartoon from hell; fill in your own caption.

To me, it is reminiscent of making a drunken frat boy clean up his own vomit. Except that this frat boy would sweep it under the carpet, since he puked in all the frat and sorority houses on campus except his own.

Only a financial industry lobbyist could have dreamt that one up. The bait is a Commission, which might give America’s middle and working classes modest relief from the harsh and sometimes criminal lending and debt collection practices of a less and less regulated financial industry. Relief made all the more necessary by the acceleration of economic changes - and the tearing apart of our social safety net - during Bush’s eight-year binge as president. The hook, however, is that Alan Greenspan and his ideological peers would run it. The line and reel are the credit industry.

It’s a suggestion Mrs. Clinton should quickly disavow as her senior moment.

By: RockPaperScizzors

RockPaperScizzors — Mon, 24 Mar 2008 18:33:45 +0000

I’m patiently waiting for the ”econ op-eds” to move further into the vortex. No one yet has taken a second step near the precipice and looked over the edge into the noxious spewing volcano. The collaberation of real estate brokers, lenders, and the Bush/Paulson/Greenspan wizardry of ”stimulating” the economy thru artificial market manipulation of real estate valuation. To jumpstart the US economy as it sagged toward recession from the dot.com bubble as well as the exit of industry, jobs, and tax revenue lost via NAFTA. Fistfuls of greenbacks needed to be pumped into the hands of people to spend since our GDP is primarily consumerism (78%). Home values in the past 7 years doubled, tripled, and quadrupled out of nowhere. Interest rates fell. For the last 7 years, the US economy has not only survived on Japan’s carry trade but on the artificial home equity bonanza. And Greenspan’s allowance of ARM’s that have sunk the little people. (But then again his job was to protect the rich and offshore entitities)And now the excessive housing market values are depreciating to realistic levels.

By: rwcole

rwcole — Mon, 24 Mar 2008 18:18:56 +0000

Another poster expressed support for public ownership of the means of production. This, of course, constitutes marxism. I expessed my own point of view concerning this. I don’t understand your comment.

By: SanderO

SanderO — Mon, 24 Mar 2008 18:12:31 +0000

All people are equal, except some are more equal.