Consequences of Things as Usual

I will be publishing only on Monday for the next couple of months. Corporate Greed, Excessive CEO Pay, and Corporate Loopholes seriously affect Joe Citizen. The world is changing as Washington DC and Wall Street slowly recognize that “Houston, we have a problem!” False prophets arise in the darkness proclaiming, “Lower Interest Rates, Bailout the Financial institutions from their ills and all will be well!”

The United States is suffering from Structural Dislocations. Tax Rebates, Lower Fed Funds Rates and other stimulus packages will do little more than slow the decline while boosting up foreign economies supplying the US. All this will come at the expense of our children who will be left holding the bag. The US government is acting like the homeowner who bought too much house for their earning capacity and then refinanced every year leveraging up each time. At a certain point the bubble bursts and the faux earnings come out of the system leaving the homeowner upside down in his house. This is where we are with the US economy. We continue to spend our nation’s equity without increasing our productive capabilities. The result is always bad.

In some areas the decline is breathtaking while other areas still do not show the perilous times ahead of us. When the US dollar traded at 1.44 Euro I said it would go to 1.75 Euro. I believed that to happen over the next year not the next 30 days. Continuing Unemployment Claims are at historically high levels as the Labor Department says that we will not see the 20% unemployment of the 1930s. I suggest we are well past that level when calculated with the same formula used in the 1930s not the faux calculations imparted after the beginning of Reaganomics.

Eliot Spitzer has been shown for what he is: a corrupt public servant that used his office for his own personal gain. Corruption is the only result that can come from collusion between unscrupulous business executives and lying politicians.

Bear Stearns, the financial institution, has to be bailed out by JP Morgan. JP Morgan will only do the deal if the Federal Reserve guarantees their investment. Yes your tax dollars are going to buy out Bear Stearns. All this while the government is trying to unilaterally reduce Social Security Benefits for which you paid your entire working life. This is just the latest example of why legislation must be passed to limit CEO pay. The CEO of Bear Stearns has received more compensation in the last five years than the entire net worth of the company!

Our politicians continue to squawk about the war in IRAQ, tax cuts, buying entire neighborhoods, relaxing regulations to allow companies to employ more unethical and illegal practices instead of looking at the real problem: The United States no longer produces a reasonable portion of its internal consumption.

Washington must go cold turkey. They must break all ties with business and lobbies. They must take a hard look at our economy, our culture, and our nation and create a framework in which hard work is valued and entrepreneurs can actually create businesses and not Ponzy Schemes. They must allow Americans to have hope for a better tomorrow for themselves and their children.

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California and New York want funds for their Illegal Immigrants

New York and California are feeling the negative effects of illegal immigration. California, for example, has just reduced its statewide spending by 10% and has announced that it will have to further reduce governmental expenditures to remain complaint with state law. New York’s governor, Eliot Spitzer, is talking about the same difficulties. Both states are sanctuary states favoring illegal immigration. Spitzer recently attempted to allow illegal immigrants to have driver’s licenses and, in fact, to vote in the elections. California has openly declared that it follows a sanctuary policy.

Over the weekend the two governors got together to encourage the Federal Government to invest in major infrastructure programs that they have drawn up. I agree that the Federal Government must stop investing in the rest of the world and start rebuilding the US. These funds must not go to states with immigration policies that thwart the Federal Government’s attempt to enforce our borders. More importantly, if the Federal government approves funds for these states they will, in fact, supply jobs to illegal immigrants or will be assigning projects to companies that use illegal immigrant slave labor.

The budgets of these states are severely stressed by the costs of illegal immigration. California and New York have decided that the Federal Government should subsidize their budget shortfalls instead of asking employers who benefit from illegal immigrant slave labor to pay the additional costs. It should be remembered, States with sanctuary policies are prohibited, by law, from receiving Federal funds. Congress, by dedicating funds to these states, is breaking the very laws they passed.

This will not stop Congress from pork projects in California and New York. The great dames of Congress, Hillary Clinton (Senator New York) and Nancy Pelosi (Representative California and Speaker of the House), will disregard legislation and pump billions of dollars into their local economies making the whole country pay their irresponsible amnesty policies. It will be interesting to see what Barack Obama (Senator of Illinois), another Sanctuary State, will do. He has stated that he will eliminate pork. I truly wonder if this is the case. I believe that our future President of the United States (whether it be Clinton or Obama) will violate Federal Law and dedicate funds to sanctuary states to cover budget deficits caused by illegal immigration.

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NAR Lobby suspends funds to Congress

FED Chairman Ben Bernanke and Treasury Secretary Hank Paulsen spoke before the Senate Banking committee today to talk about the credit mess and the ensuing recession. Eliot Spitzer, Governor of New York, along with his Insurance Regulator, Eric R. Dinallo, addressed the U.S. House of Representatives’ Financial Services Committee’s Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises. They also talked about the ensuing recession and collapse of the US financial system. The Congress is now involved because years of corruption and unbridled greed created “complex instruments” that magically transformed junk grade investment paper into AAA top grade paper.

It would be reasonable to think that this was the most important thing going on in Washington. News Services ran continuous real time coverage, without advertising, for several hours. A small headline on the newswires instead caught my attention. It received no major coverage. Not even Lou Dobbs picked it up. The title read:

NAR Lobby suspends funds to Congress

The press release (yes, they sent out a press release) states that the NAR will not contribute further funds to politicians for their lack of action to resolve the housing crisis.

A fantastic watchdog group, The Center for Responsive Politics, puts this into context. During election years the lobby contributes about $ 4 million to politicians. This means that this year the lobby will not donate the expected funds to campaign coffers unless Congress passes some law that lobby feels is beneficial to the NAR. This press release interestingly occurs just 1 day before the EARMARK pork season begins.

These funds from the lobby are clearly kickbacks and should be identified as such with criminal prosecution. We have serious problems with our country. One of the most important is the public debt. The US government’s insolvency is so pronounced that the government must break its contractual agreement of social security and reduce benefits to working men and women who have paid into the system for 20 to 50 years.

Let’s talk clear. This is corruption.

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Congress passes Energy Bill – Ethanol is not about saving oil

Congress passes the Energy Bill for 2008. It defines many things. Most importantly it dedicates money to develop energy supply. This bill continues to give subsidies to American Oil producers even though oil remains at record high prices. The most important thing the bill does is that it encourages, through funding, alternative sources of energy. Ethanol an important part of the bill with a mandate to create ethanol from non food based raw materials. Many people continue to criticize the production of ethanol.

There are many discutable financial reasons why ethanol is not a good idea. First it will take a tremendous amount of corn to produce a significant amount of ethanol. If oil were abundant in the US and not in bad places it would cost less to produce gasoline than ethanol. Ethanol requires investments in infrastructures that will reduce corporate earnings.

There is one reason to develop ethanol that outweighs the financial costs of using alternative fuels. That reason is that we do not have to have an army to protect ethanol supplies. No American will die to defend “US interests”, better known as international oil reserves. We will no longer have any reason to fight with the Arabs. We will no longer fund their regimes. We will not have to worry about their nuclear intentions.

As a popular television advertisement would say: “Priceless!”

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Free Market - Only applicable for the working man

US Treasury Secretary, Henry “Hank” Paulsen, today announced the administration’s plan to fix the massive foreclosures a direct result of speculation by financial institutions as they greedily chased an expanding market completely ignoring the bare basics of lending. Loose lending standards propagated by greedy institutions have created serious resource dislocations and allowed consumers to access credit for homes they cannot afford. This is a serious problem with most major US financial institutions hiding losses that would result in their bankruptcy.

In traditional Reaganomics fashion the Secretary of the Treasury announced a bailout for homeowners in foreclosure. The unusual thing about this plan is that it will not help homeowners. Paraphrasing:

“The US economy is strong… blah, blah, blah … This is not a bailout… blah, blah, blah … We want to help American homeowners… blah, blah, blah … Three part plan… blah, blah, blah … Freeze interest rates for a period of time… blah, blah, blah … Only homeowners with good credit… blah, blah, blah … Only homeowners who can make future payments… blah, blah, blah … No homeowners that can afford higher rates… blah, blah, blah … Congress will authorize new tax free bonds (No opportunity is too serious not to propose a tax cut for the rich)… Fannie Mae and Freddie Mac will be an important part of this program … Whoa Nelly!”

Hidden in 30 minutes of political mumbo jumbo the bailout for financial institutions. Freddie Mac and Fannie Mae will have their loan limits increased, their reserve requirements relaxed and be forced to take on all of the junk. It is obvious that the implied US governmental guarantee will become a real guarantee. The $1.5 trillion speculative hole will weigh on the US taxpayer.

This is just another example of our corrupt and decadent mentality. We spout words of personal responsibility and adaptation. We pass legislation that eliminates the possibility of a new start for the individual. Free Market is our cry yet as soon as the disastrous consequences of Reaganomics show their ugliness we call for the government to bail them out. Cowboy Capitalism is only valid to rape and pillage the working class. Reaganomics exists only to protect the corruption of family dynasties.

The housing crisis is serious. The solution is simple. All those who created and profited the leverage in the mortgage industry should have their ill gotten gains sequestered. The future of Citicorp, Bank of America and Goldman Sachs is not more important than the future of our nation. Tax revenues must not be used in any form to bailout the financial institutions no matter what the cost to their balance sheets. We cannot afford to care for our sick, we cannot feed our hungry, we cannot house our homeless. We surely cannot protect the McMansions of Wall Street.

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US Government’s Economic Policy ravages US markets – Financial Stocks Tank

The piper has come for payment. In August the Fed bailed out their buddies in the major US financial institutions. After years of speculating in credit derivatives the collapse of the housing bubble threatened the existence of most financial institutions. Instead of requiring the institutions to write down their bad positions the FED pumped in almost $1trillion in liquidity and piloted the purchase of Country Wide Financial, the poster child of bad lending practices, by 4 major banks utilizing funds lent by the Federal Reserve to these institutions. The FED lowered interest rates even though real inflation is through the roof. This was a really bad move but right in line with the disastrous ideology of Reaganomics.

The US dollar has been losing value for the past 5 years. A country’s currency can be seen as shares representing the country’s equity. Just like shares if you spend more money than you earn the currency diminishes in value to represent the new economic reality. If a company creates more shares the value of existing shares is diminished. If the company pays a dividend it receives a higher valuation. The dividend for currency is interest rates. A company may also receive a higher price if the future outlook for earnings (retained equity) is positive. The dollar has devalued because of the current account deficit, budget deficits, artificially low interest rates, and the lack of faith in the United States as a going concern.

The US has eliminated internal production of goods and services. The US only produces 20% of the goods it produces. The US is completely dependent on countries that do not have our values or our product safety laws. The excuse is for cheap labor but the reality is that products may be produced using materials and processes banned in the US. If a worker dies, well, “C’est la vi.” That glue is not available well GHB will do just fine for a child’s toy. The shipping costs are offset by cheap energy produced by high polluting processes. The US cannot complain about quality or the producer will stop shipping goods and stores in the US will have empty shelves. The economic impact of Free Trade at all costs is a reduction of middleclass jobs, lower wages across all segments, and a migration of wealth from the middleclass to the upper class.

The US lives on a smoke and mirrors “Service Economy”. US corporations have become nothing more than marketing companies. Research and Development, Intellectual property, quality workmanship are no longer important. We now make money without working. Wow! Experienced and educated professionals are the latest in the outsourcing scheme. In countries where University is free the PHDs abound and corporate America wants a piece of these low cost professionals. We are now emptying the US production machine, basis of any country, of the last remaining resource, educated scientists, engineers, and top managers.

Corruption is widespread in both Government and Business. Taxes are a cost of doing business. Corruption is a hidden tax on the economy. Corruption is paid for by the collective while the benefits are limited to the parties involved. Corruption is considered a victimless crime. This is like saying that dumping toxic waste into the watershed is a victimless crime. There are victims it is just harder to find the direct correlation. Corruption affects everyone in the country. It reduces GDP just a higher taxes or high interest rates. It causes the loss of jobs. I consider governmental corruption up there with mass murder because the economic effects are felt by rich and poor alike. This in turn results in people not being able to pay their bills, have homes or sometimes even eat. Corruption should carry a mandatory life sentence and lobbying by corporations should be made illegal.

Collusion between politicians and Corporate America has distracted resources from internal infrastructures. Lobbying is legalized bribes. In any other developed country the activities of lobbies would be considered criminal. In the early 90s Italy went through a cleansing process eliminating entire political parties and incarcerating corrupt politicians. The activities were no different than our politicians taking vacations (or the many other perks) on the corporate dime. Italy has since maintained a stable government, reasonable growth, and contained inflation. It would be valuable to discuss the pros and cons of corporate lobbies. It is a good thing that citizens can petition their government for change. It is a bad thing that corporations can petition anyone considering the fact that corporations are not citizens. Corporations have one objective: to make money and the corporation is often misused to further an individual’s greed such as a CEO that makes hundreds of millions of dollars.

Our system is on the verge of collapse. We need to make changes to the underlying system. The problem is grave. The difficulties we are current facing have been brewing for thirty years and cannot be overcome with a change in interest rates or throwing money at the problems. Change will not come without sacrifice but it is time to pay the piper because the piper will always get his due. Our politicians have no vested interest in change. They are more powerful and receive higher compensation than any time in history. To start to fix the problem we need to change the players. We need real working people in Congress. We need a President who represents us and will think about his country before he thinks about his legacy or other personal gain. We need an individual who is not a politician, someone who actually works for a living (or would if he had a job left). Perhaps one of the workers from middle America who has seen his job outsourced or the scientist who cannot pay his university loans because wages for professionals have been trending downward.

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Mr. Bernanke, Save our $ 100 Million Bonus!

The whining CEOs of America are at it again. In chorus they are calling for the Federal Reserve to decrease interest rates. The tight monetary policy is destroying the economy. Mr. Bernanke, can’t you see that we are in a recession and we will lose our jobs. Mr. Bernanke, Please drop interest rates, our $100 million dollar bonus is based on stock performance. Without intervention from the FED our stock prices will go down. It will be a disaster, this year we will only make $2 million.

It does not matter that these CEOs have driven their companies to the brink of disaster. It does not matter that they have fired their US employees. It does not matter that customer service is now inexistent. It does not matter that these CEOs have lost their competitive advantage by purchasing shoddy products from “developing markets.” It does not matter that they have knowingly introduced into the US market dangerous products undercutting the profitability of US produced goods and services. All that matters is that these “Pezzi da Novanta” are going to lose their bonuses.

Yes, I agree, the US economy is in the pits. Yes, there are many problems. Yes, unemployment is really about 12% instead of the 4.5% listed in the government data. Yes, public debt is 70% of GDP as measured by GAAP. But inflation is also rampant and the only way to bring it down is with tough love economic policy. We must reduce our debt, not by breaking the contract of Social Security, but be eliminating tax breaks and removing tax relief for the top 0.5% of the population. We must stop subsidizing US companies who produce products outside of the US through wars to “protect US interests.” We must eliminate financial institution’s stranglehold on US citizens by passing tough usury laws making “fees” part of interest costs and limiting interest to 10% above LIBOR.

We must take on inflation. Interest rates are historically low. Lowering interest rates at this point will only increase inflation. It will not take on the reasons why we are in such a mess. We are in this predicament because corporate America has taken over the government. America is longer a place of dreams. Americans are simply cattle for the slaughter for corporations.

Do not worry corporate America. Mr. Bernanke will come to your rescue. Good economic policy is simply a matter of perception. You will get your interest rate cut. The stock market will go up and you will get your end of year bonus. Unfortunately the future will not be as bright. Monopoly style economic policy will create further dislocations in our economy and sooner or later the piper will be paid.

Tags: Government Politics China Corporate America Finance Economy Reaganomics

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Department of Homeland Security – The Good, Bad and the Ugly

Interesting that a Clint Eastwood film could so easily describe our Department of Homeland Security.

The Good: The department of Homeland Security has some really good people, trying to protect this country and who do their jobs responsibly.

The Bad: The department of Homeland Security does some really bad and stupid things like convicting two agents for doing their job, supporting illegal immigration policies on the Mexican border, and lying to Congress. If you or I lied to Congress or to Homeland Security, for that matter, right now we would be in jail. Remember Martha Stewart et al? Most people are convicted of lying to the justice department not for the crime for which they are being investigated. The personal interests, may I even say corruption, of the higher officials and politicians responsible for controlling Homeland Security too often take precedence over the good of the country and the direction given by the voters. Homeland Security officials have justified their actions by saying that they will not bow to the populous movement.

Just for clarity, the populous movement means the will of the people, the electorate. Yes this is you and me. Individuals in Homeland Security believe that the government should operate as they want it to, not following the desires of the people. I guess, WE THE PEOPLE, are too dumb to know what we want our government to do.

The Ugly: The department of Homeland Security does some really ugly things like losing 12+ billion dollars in Iraq and looking the other way over problems at the core of their responsibilities like port and border security just so the corporations can make a few extra bucks.

Now the politicians want a terror war tax. Why? Why are we thinking about raging war across the world when we are not capable of securing our own borders.

We would not have a terror war in the first place if we remembered that the electorate is made of living and breathing people and not of corporations. We do not need to raise taxes, we need to cut out the corporations from our political process. We need to put People back in “WE THE PEOPLE.”

Without the people, “This Land is our Land”, is not a true statement. Without the populous movement, there is no one to fight the wars or pay taxes. Perhaps the populous movement is important. The United States has lost its identity. Homeland Security seems to be an organization designed to protect corporate interests, not the people of the United States. There is good in Homeland Security perhaps we can take the good people and free them from a corrupt organization allowing them to do their jobs. We must require that our elected officials concentrate on holding responsible those corrupt individuals involved in advancing their personal agenda over the will of the people. We must require that these individuals go to jail, just as you or I would. We must remember that justice is blind and that equality is not just about color.

Tags: Politics Corporate America Corrupt Politicians Government Data War on the Middle Class Border Security Port Security Stop Pork Spending Illegal Immigration

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Democrats want a Moratorium on Pork Spending?

I cannot believe it. I actually have found something good to say about politicians. Can you believe it the Democrats are talking about banning pork for a short period of time while they look at Lobby Reform. I am all for rewriting legislation on lobbying. I would take away its current legal status, after these are just bribes.

My immediate question is why have our elected representatives thought that this should just be a moratorium? I have seen some of the initial thoughts on what lobby reform means for the incoming congress and it is simply a more defined license to take bribes. Our representatives get paid enough to pay for their own lunches. Ask Joe worker if he is willing to buy his own meals and pay for his own vacations if he makes more than $150K a year plus medical, dental and a pension plan that will not be “fixed” after paying into it for his entire life.

I was not born yesterday. I am certainly skeptical regarding their intention to actually do something that will help this nation. Perhaps it is just a marketing ploy. Perhaps they intend to stop studying lobby reform and not tell anyone so the pork starts again while the country thinks they are fighting excessive spending. I do not know but it is a step in the right direction and we need to let our representatives know that we appreciate them actually doing what they were elected, and are paid, to do.

Tags: Politics Corporate America Corrupt Politicians Government Data War on the Middle Class Border Security Port Security Stop Pork Spending

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Congress passes laws reflecting their Constituent’s wishes

The 109th Congress finished its business last week. On their last day of business they passed legislation regarding which, true to form, showed who their real constituents are. Do you think they passed Minimum Wage legislation or Financed the Border Security Bill already passed but not funded? No, they had to pass legislation to extend tax cuts for the top ½ of 1 % of the population of the US!

I am impressed by the arrogance of our government and the politicians who represent us. They lie to us telling us they will act in one way and once they are elected they then think only of their pockets notwithstanding there are numerous voices calling for responsibility. We cannot even change them because the current two party system and corporate fundraising excludes those candidates who are qualified and represent Joe Citizen. So what shall we do?

The new Congress is already talking about doing things the representatives had indicated they would not do. Investigations into this and that, Amnesty for criminal aliens and an open border policy with a country that not only cannot secure its own borders but cannot control organized crime exploding on the US border. The US is their steam valve. Just let their poor immigrate to the US. The only US constituents this represents is again, Corporate America, attempting, and succeeding in driving down wages, making the rich, richer and the poor, poorer.

The US was born as a melting pot however this shortsighted immigration policy in a mature market has changed the melting pot to a pressure cooker. If the steam cannot be released there will be an explosion. What can we expect from this rosy future? We can expect the government to used the armed forces against the civil population as it has done in the past. Have we forgotten Grover Cleveland using the secret service to kill the striking workers of Chicago, or the students at Kent State under fire from the National Guard?

It is time for responsibility in government the corruption must end. How can we expect to be the beacon of peace and democracy when we cannot get our own government to represent Joe Citizen the voter?


Tags: Politics Corporate America Corrupt Politicians Government Data War on the Middle Class Border Security Port Security Stop Pork Spending Illegal Immigration

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The Dollar Plummets against major currencies – Is this important?

Turn on the television, read any newspaper and every opinion will be supported by the fall of the dollar. There are those who say the dollar falls because US interest rates are low while other countries have higher rates. There are those who will say the exchange rate shows that the US economy is tanking while turn the page or wait for the next news story and this idea will be refuted, forcefully declaring, “The dollar’s decline is perception, it is driven down by those who hate America, it has nothing to do with the goldilocks economy, the greatest story never told.”

The fact is that a currency is simply a representation of equity. If the country produces or saves more and keeps the same number of monetary shares (dollars in the case of the US) then the currency increases in value. If the country spends more than it produces or prints more money while equity remains the same then the value falls. This is like a stock split, more stock, each worth less.

In a country’s equity is “goodwill”. This is the same for companies. Goodwill is the value of the name, the existence of products, procedures and other intangibles. Goodwill indicates an arbitrary value for future reduced costs for an established company when compared to a new company. A simple example of Goodwill is that if Microsoft creates a new spreadsheet at the same time as Apple, Microsoft will sell more with fewer advertising dollars. This is the value of Goodwill.

Financial markets look at exchange rates based on what will happen in the future. So current exchange rates do not reflect today’s value but a value moved out about 12 months. In this way the economy affects exchange rates or more appropriately, the exchange rate reflects the perception of future tendencies. Today’s decline in the dollar could be seen as the perception that the US economy will perform poorly over the next twelve months while the trade deficit or saving’s rate will remain at the current dangerous levels. To say it simply, those with money think that in the near term future the equity value of the US will be less than it currently is.

Is this really important to you and me? Unfortunately the answer is yes. Our government, over the last 30 years, has taken us away from a production economy into a smoke and mirrors service economy. Over 60% of what we consume comes from foreign sources. As the dollar loses value our products increase in cost. While increasing labor costs are more than offset by productivity thus inflation negative, the falling dollar is inflationary. This will cause the Federal Reserve to increase interest rates, slowing consumption, creating greater instability with a great risk of StagFlation. Yes, the worse case scenario for any economy.

Our only solution to this situation is to reduce imports, recreate our infrastructure and production facilities, bite the bullet, increase taxes to pay down debt, and suffer for a few years. Reaganomics has dilapidated the wealth of our nation. Our current leaders are pushing ever harder to take this to the next level. I can only assume that since Mr. Bush’s Presidential legacy of stabilizing the Middle East did not happen that he is working on something else to be remembered by. I personally believe that the failure in the Middle East is bad but the consequences of these economic policies are significantly worse. No it is not all his fault, our country has been under attack by corporate raiders since Reagan, but it is his fault continuing on this path.

Our politicians criticize Europe for “Disastrous Economic Policy” yet their share value (the Euro) has increased 80% since 1998. The United States share value (the Dollar) has lost 50% of its value. This is not a short-term manipulation. It is a longstanding trend.

Tags: Politics Corporate America Corrupt Politicians Government Data War on the Middle Class Foreign Policy Economic Policy Stop Pork Spending Illegal Immigration

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Fed Chair Bernanke in China – What’s up?

Recently I suggested that governmental data was at best incorrect. The need to filter the noise and the spin is important to understand where we are and what we need to be doing. Testifying before the Senate Banking Committee that China’s immense holdings of US assets and debt did not pose a threat to the US economy, Federal Reserve Chairman, Ben Bernanke, said, "I don't think that the Chinese ownership of U.S. assets is so large as to put our country at risk economically; it would be very much against their own interest to do so"

Mysteriously this week, Bernanke pulled up stakes and flew to China at the request of the Treasury Secretary Henry Paulson. Instead of spending Thanksgiving with his family the Treasury Secretary asked and Fed Chairman agreed to meet with the Chinese Government in China.

Could it be that the administration is taking seriously China’s recent threats to tank the US economy by selling both dollars and Treasury debt?

While the headlines talk about Bernanke encouraging the Chinese government to fight intellectual property piracy and to allow the currency to fluctuate more freely, only a small, insignificant, one line mention was given to the primary reason for this desperate move. Bernanke is expected to make the point that the United States' reliance on China as a buyer of its debt is not sustainable.

So Bernanke is in China to negotiate with China concerning the sale of US assets and debt. My question is what can he offer? While Mr. Bernanke may believe he understands what is “China’s best interest”, the only people who have any say in the matter are the Chinese. The truth is, we are in the crapper. Not on it, we are in it. The only thing Mr. Bernanke can negotiate with is Joe Worker’s wages. In other words he will have to facilitate China’s expansion into US markets to keep them from tanking our economy.

I can hear you now, “this guy is crazy!” US #1, we are the strongest economy in the world! Now that you have exploded let’s get rid of the spin. Treasury Secretary Paulson is meeting with his old financial company buddies to prepare them in case there should be some difficulties.


"You always want to take market reaction into account when government makes a determination," Tony Snow told reporters in Chicago when asked whether top officials were discussing the possibility privately with investors.

"Prudent governments will always try and assess markets and try and prepare markets so markets aren't disrupted," he said.

So Paulson is trying to negotiate buyers for the upcoming sales of Treasury debt. What will he have to give up in exchange? Perhaps a guarantee that the Administration will Veto any legislation to extend usury laws to financial institutions?

The worldwide currency traders are taking China seriously. The dollars has lost 2.5% in two days.

Gutless, corrupt politicians, it is time to come clean with the US citizens and to take on thirty years of disastrous Reaganomics. Free Trade only works in a Free World, Free of Corruption. This is not the world we live in today. To fix our country and return the United States to its previous glory, truly the envy of the world, and not just in the minds of some financial analysts, we need to admit our problems, cut our losses and initiate the long and hard path to prosperity.

Tags: Politics Inept Government Corrupt Politicians Government Data War on the Middle Class Federal Reserve US Treasury China Tanks US Chinese Threat

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