ANSWER: NO. FROM TODAY’S “GUARDIAN” (U.K.): “The decision gives Netanyahu the comfort of a government with a broader base. He will lead a coalition drawn from across the political spectrum, embracing in an unlikely partnership both Avigdor Lieberman, an outspoken far-right politician, and now Barak, head of the traditionally left-of-centre and social welfare-oriented Labour party.”

ARTICLE – http://www.guardian.co.uk/worl…..-netanyahu

Their values have declined because the underlying mortgages are bad. They were intentionally marketed to those with bad, or insufficient credit; to those not asked to establish their creditworthiness to start with; and to those millions whose credit is now bad because they’ve lost their jobs, their credit card rates have jumped to thirty percent and they can’t pay their bills, they can’t find another job, they can’t get health care, and they can’t file bankruptcy because the rules put repaying their CC debt ahead of almost every other kind, including child support.

Mr. Geithner is using billion dollar make-up to make his pig attractive. Tomorrow he’ll take it to Kitty Hawk and tell us he saw it fly. The drop in the “value” of MBS’s is appropriate. Hundreds of banks are technically insolvent because of it, just as the assets of hundreds of pension funds are lower because they hold stock in the offending institutions or the MBS’s themselves. Addressing those problems, as ugly as they are, would be less expensive, put the public, not private parties in the driver’s seat, and actually fix what needs fixing. It would quickly restore modified confidence; more confidence building still would be to put in place a credible regulatory framework that made it harder to blow up this bubble again.

Geithner, and hence, Obama’s plan, is built around keeping their heads in the sand. They forget the part of their anatomy that leaves most prominent. The Republicans, like the banks, may take the money and run. They will still paint a huge, “Kick Me” sign on the presidential rump and take their own advice.

And from the Department of Irony: Putting our economy at risk for a 21st century Weimar inflation debacle is no way to boost real estate values. It’s like winning the war on drugs by having the cartels reject dollars for euros, and thereby cutting down the flow of drugs into U.S.

The damage to the political system is going to be stupendous. Like the USSR where for years and years everyone just pretended the system was functioning. Geithner thus becomes like a high ranking member of the Polit Bureau.

God knows I could be wrong but the way I see it the Administration is making one of the biggest political blunders in American history. Every other good thing they do is almost irrelevant.

In addition to my screed about the printing press.

The Feds printing for the express purpose of purchasing Treasury paper is essentially a proclamation that there will be no failed auctions. So when this trillion is gone you can count on another trillion on the way. Unless we have a miracle of course.

Taking the big ledger book picture, the Fed is now the lender of last resort and the Treasury is the borrower of last resort.

SEE: “Umm al-Fahm violence is a sign of things to come in Lieberman’s Israel”
AT – http://www.philipweiss.org/mon…..srael.html

The assumption underlying Fed & Treasury’s “too big to fail” policy (trillions dumped into the financial system since mid-2007 when the great unraveling became apparent) is that the full faith and credit of the United States of America is too big to fail.

We are operating now at $3 billion per day deficit. It’s a question of when, not if, treasury auctions will fail. The worst sign of this phenomenon is last week’s announcement that the Fed would be buying billions of long term treasuries to force down mortgage interest rates.

You and what printing press, Mr. Bernanke?

I’m sure we’ll see this inconvenient truth in tonight’s Frontline program
Ten Trillion and Counting.

P.S. Oh oh, looks like someone’s finally standing up to Goldman Sachs’ hostile take over of our federal government. Go, Bernie!

That’s what Fed words have been aimed at since October 1987. Words words words and more words to get financial assets to inflate has been the functional role of the Fed since Greenspan at 9AM on black Monday 87.

Words alone are not enough however. Under Greenspan the Open Market Operations desk routinely did repos in significant size on the days of Greenspan’s words. It is under appreciated how these cash infusions to the primary dealers were a like a snort of coke to the markets. They cash immediately put to work at the trading desks of PD’s, especially the Investment Banks.

For poor Ben it has gotten a bit more complicated. As the alphabet soup of special programs and funds has grown open market operations have shrunk to total insignificance in implementing Fed policy. If you can call the relentless growth of the Feds System Open Market Account at a 4% rate year after year after year a policy, except when it jumped to 7% sometimes. Which all collapsed in Jan 08 as the banks didn’t want the Feds cash and the SOMA collapsed, followed by the market.

So Ben needs a way to mainline cash into the financial players hands so they can go play and inflate asset prices. To wit buying every kind of paper, including I think baseball trading cards of obscure failures nobody ever heard of, so he can get something to inflate. It’s all pretty straight forward really.