Category Archives: Bailout

Obama Nation: Ray of Hope has Already Darkened for Many

State of Obama Nation: One year on from America’s choice

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World Wants to Divorce Itself From U.S. Dollar

“US is on the slippery slope to economic collapse”

Bernanke’s Reappointment: Good for the Fed, Disaster for the Economy

Sen. Sanders Statement on Bernanke Nomination

Sen. Bernie Sanders (I-Vt.) today issued the following statement on the nomination of Ben S. Bernanke for another term as chairman of the Federal Reserve:

“As a result of the greed, irresponsibility and illegal behavior of Wall Street our country has experienced the worst economic decline since the Great Depression. Mr. Bernanke was head of the Fed and the nation’s chief economist as this crisis, driven by reckless speculation, developed. Tragically, like the rest of the Bush administration, he was asleep at the wheel during this period and did nothing to move our financial system onto safer grounds.

“As the middle class of this country continues to shrink, we need a chairman of the Federal Reserve who is more concerned about expanding the productive economy – increasing decent-paying jobs for all Americans – than continuing to fan the flames of Wall Street greed and outrageous compensation packages.”

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Senator Sanders asks Bernanke WHERE IS THE MONEY

Obama Reappoints Bernanke for Second Fed Term

Goldman Sachs: Engineering the Great Depression

The Great American Bubble Machine

From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression – and they’re about to do it again

The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who’s Who of Goldman Sachs graduates.

By now, most of us know the major players. As George Bush’s last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. Robert Rubin, Bill Clinton’s former Treasury secretary, spent 26 years at Goldman before becoming chairman of Citigroup — which in turn got a $300 billion taxpayer bailout from Paulson. There’s John Thain, the asshole chief of Merrill Lynch who bought an $87,000 area rug for his office as his company was imploding; a former Goldman banker, Thain enjoyed a multibilliondollar handout from Paulson, who used billions in taxpayer funds to help Bank of America rescue Thain’s sorry company. And Robert Steel, the former Goldmanite head of Wachovia, scored himself and his fellow executives $225 million in goldenparachute payments as his bank was selfdestructing. There’s Joshua Bolten, Bush’s chief of staff during the bailout, and Mark Patterson, the current Treasury chief of staff, who was a Goldman lobbyist just a year ago, and Ed Liddy, the former Goldman director whom Paulson put in charge of bailedout insurance giant AIG, which forked over $13 billion to Goldman after Liddy came on board. The heads of the Canadian and Italian national banks are Goldman alums, as is the head of the World Bank, the head of the New York Stock Exchange, the last two heads of the Federal Reserve Bank of New York — which, incidentally, is now in charge of overseeing Goldman — not to mention … Full Story

Amy Goodman Interview with Matt Taibbi

America’s Make Believe Economy

What Economy?
There’s Nothing Left to Recover
Paul Craig Roberts

There is no economy left to recover. The US manufacturing economy was lost to offshoring and free trade ideology. It was replaced by a mythical “New Economy.”

The “New Economy” was based on services. Its artificial life was fed by the Federal Reserve’s artificially low interest rates, which produced a real estate bubble, and by “free market” financial deregulation, which unleashed financial gangsters to new heights of debt leverage and fraudulent financial products.

The real economy was traded away for a make-believe economy. When the make-believe economy collapsed, Americans’ wealth in their real estate, pensions, and savings collapsed dramatically while their jobs disappeared.

The debt economy caused Americans to leverage their assets. They refinanced their homes and spent the equity. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going.

And now suddenly Americans can’t borrow in order to spend. They are over their heads in debt. Jobs are disappearing. America’s consumer economy, approximately 70% of GDP, is dead. Those Americans who still have jobs are saving against the prospect of job loss. Millions are homeless. Some have moved in with family and friends; others are living in tent cities.

Meanwhile the US government’s budget deficit has jumped from $455 billion in 2008 to $2,000 billion this year, with another $2,000 billion on the books for 2010. And President Obama has intensified America’s expensive war of aggression in Afghanistan and initiated a new war in Pakistan. Full Story

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V.P. Biden: “We Misread How Bad The Economy Was”

Jet-setting to Vacation Homes on Federal Money

Bailed-out banks’ CEOs used company jets for personal use

Chief executives of some banks that received federal money, including Bank of America Corp, Morgan Stanley and Regions Financial Corp, used company jets for their personal use, the Wall Street Journal reported on its website.

Flight records showed many occasions when banks receiving federal money flew their planes to destinations near resorts or executives’ vacation homes in Europe, Mexico, the Caribbean, south Florida and Aspen, according to the paper.

“We are implementing a new policy in 2009, under which personal use of aircraft will not be permitted,” a Bank of America spokesman told the paper, but declined to comment on specific trips.

In some cases, it was clear that bank executives were traveling for personal reasons; for other flights, many of which were over weekends or holidays, the passengers and purpose couldn’t be established, the paper added.

A spokesman for Morgan Stanley declined to comment to the paper on individual flights, but said its policy was to allow CEO John Mack personal use of corporate jets, with the cost “fully disclosed” in annual proxy filings.

A Regions spokesman also declined to comment to the paper on the trip or the cost estimate, but said all travel on company jets “either for personal or business was within our policy.”

The banks could not be immediately reached for comment by Reuters.

IMF’s Big, Bold Role in a Worsening Economic Crisis

Economic crisis getting worse: IMF

A Bigger, Bolder Role Is Imagined For the IMF

Inside a cavernous assembly hall in downtown Washington, dignitaries gather twice a year for routine meetings of the International Monetary Fund. Before long, though, the room could take center stage in the IMF’s transformation into a veritable United Nations for the global economy.

Surrounded by blond wood paneling and a digital screen the size of a cinema’s, central bankers and finance ministers would meet to convene a financial security council of sorts. Serving almost as ambassadors to the IMF, they would debate ways to put out the world’s economic fires and stifle reckless policies before they ignite new ones.

Bowing to a new economic world order, the IMF would grant fresh powers to the likes of China, India and Brazil. It would have vastly expanded authority to act as a global banker to governments rich and poor. And with more flexibility to effectively print its own money, it would have the ability to inject liquidity into global markets in a way once limited to major central banks, including the U.S. Federal Reserve.

That image of a radically transformed IMF — whose role in the global economy had turned largely advisory in recent years — is now coming together through internal IMF documents, interviews and think-tank reports. Finance ministers from major nations will begin grappling with the formidable details of the IMF’s makeover this weekend when they converge in Washington for the fund’s biannual assembly.

The changes, broadly outlined by President Obama and other leaders of the Group of 20 nations in London earlier this month, could take months, even years to take shape. But the IMF is all but certain to take a central role in managing the world economy. As a result, Washington is poised to become the power center for global financial policy, much as the United Nations has long made New York the world center for diplomacy.

The IMF’s mission is expanding so broadly that its managing director, Dominique Strauss-Kahn, said in an interview that the organization — which underwent deep cuts last year before the financial crisis swept the globe — may boost staffing in coming months, potentially creating dozens of high-paying jobs in the District.

“The IMF is changing, and with it, there will be a sea change in the way the world economy is run,” said C. Fred Bergsten, director of the Peterson Institute for International Economics. “Their role will dramatically shift. You’re talking about monitoring fiscal stimulus, moving toward tighter regulations for financial institutions. You’re talking about global economic management in a way we have never seen.”

Already, the economic crisis is triggering a profound cultural shift, with the IMF moving away from its long-held mission to spread the gospel of capitalism around the globe.

Founded at the end of World War II to maintain stability in global currency markets, it later became known as the lender of last resort for nations in crisis, particularly as financial fires raced across Asia and Latin America in the 1990s. Its bailouts, however, were the bane of many poor countries; they often came with demands for fiscal austerity and free-market reform as the cures for developing nations — even if that meant nations had to cut back on programs for health care and schools. Full Story

Top Ten Reasons to Oppose the IMF

What is the IMF?

The International Monetary Fund and the World Bank were created in 1944 at a conference in Bretton Woods, New Hampshire, and are now based in Washington, DC. The IMF was originally designed to promote international economic cooperation and provide its member countries with short term loans so they could trade with other countries (achieve balance of payments). Since the debt crisis of the 1980’s, the IMF has assumed the role of bailing out countries during financial crises (caused in large part by currency speculation in the global casino economy) with emergency loan packages tied to certain conditions, often referred to as structural adjustment policies (SAPs). The IMF now acts like a global loan shark, exerting enormous leverage over the economies of more than 60 countries. These countries have to follow the IMF’s policies to get loans, international assistance, and even debt relief. Thus, the IMF decides how much debtor countries can spend on education, health care, and environmental protection. The IMF is one of the most powerful institutions on Earth — yet few know how it works.

1. The IMF has created an immoral system of modern day colonialism that SAPs the poor
2. The IMF serves wealthy countries and Wall Street
3. The IMF is imposing a fundamentally flawed development mode
4. The IMF is a secretive institution with no accountability
5. IMF policies promote corporate welfare
6. The IMF hurts workers
7. The IMF’s policies hurt women the most
8. IMF Policies hurt the environment
9. The IMF bails out rich bankers, creating a moral hazard and greater instability in the global economy
10. IMF bailouts deepen, rather then solve, economic crisis

Read the explanations for the Top Ten Reasons