Monday, August 22, 2011

With a Little Help from Your Friends

It is amazing how open-handed the US government has been with fraudulent and greedy bankers who drove the US (and world) economy into the greatest depression since the Great Depression. But that same government just can't see any need to help individuals. They aren't "worthy" of a bailout.

Here's a bit from an article on Bloomberg News:
Fed Chairman Ben S. Bernanke’s unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners currently owe on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley (MS), got as much as $107.3 billion, while Citigroup took $99.5 billion and Bank of America $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.
Think about that. The government had a choice. It could save America from a depression by either (a) giving $1.7 trillion to a handful of powerful bankers who created the problem or (b) giving $1.7 trillion to 6.5 million people who were losing their houses because of the economic crisis. So of course Bush, and then Obama, decided that the money was best spent by giving it to people who committed fraud rather than work for a living.

Here we are just over two years later, and did that $1.7 trillion solve the problem?
The odds of another recession have climbed during the past six months, according to five of nine economists on the Business Cycle Dating Committee of the National Bureau of Economic Research, an academic panel that dates recessions.

Bank of America’s bond-insurance prices last week surged to a rate of $342,040 a year for coverage on $10 million of debt, above where Lehman Brothers Holdings Inc. (LEHMQ)’s bond insurance was priced at the start of the week before the firm collapsed. Citigroup’s shares are trading below the split-adjusted price of $28 that they hit on the day the bank’s Fed loans peaked in January 2009. The U.S. unemployment rate was at 9.1 percent in July, compared with 4.7 percent in November 2007, before the recession began.

Homeowners are more than 30 days past due on their mortgage payments on 4.38 million properties in the U.S., and 2.16 million more properties are in foreclosure, representing a combined $1.27 trillion of unpaid principal, estimates Jacksonville, Florida-based Lender Processing Services Inc.

So... the US is headed back into another banking crisis. What will Obama do this time. I'm guessing an even bigger free handout to the corrupt bankers. I can stake my life on the fact that he will do nothing to help homeowners struggling with foreclosure and he is only giving lip-service to a "jobs plan". Nope. It will be more freebies for the billion dollar bankers.

And the Republicans? They are upset because Obama is slow to whip out the national purse and hand it over to "the job creators". They not only want to leave the unemployed and people with underwater mortgages hanging and twisting slowly in the wind. They want to raise taxes on the bottom 90% so that yet more free money can be handed out as tax cuts and incentives and special programs for the billionaire "job creators".

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