Common Sense

Thanks Greg


Barack Obama called Doctor Basso directly, aka Thomas Paine, to invite him to the White House to discuss his disturbing videos. For now, it was just an ominous invitation.

The White House also attempted directly to stop a radio interview with Dr. Basso.

See why:

Aristotle: Tolerance is the last virtue of a dying civilization.

I can't add anything. Spread this blog around. Silence is no longer a virtue.

Keeping up with the gates of hell

Little entertainment: Here

Below, Irene's research on how the Clinton era destroyed the housing industry.

NEW MOTTO:

TAXATION WITHOUT REPRESENTATION IS TYRANNY.

Catchy, I thought.

To my mind, it is one's duty to avoid tax payment. Otherwise, you are feeding the enemy.

Don't go to jail, the Crown having only the force of the usurper to rely upon, but go out of you way to remove yourself from the trough. There is no longer a voluntary tax system of the people that has been designed to support their common good. We have become slaves to the taxman who uses the FBI, the police, and computer systems to extract money from the producers in order to pay government non-producers, as well the directors of Fannie Mae. Just touching the surface:

• Executive Department workers: 1.8 million (they retire)
  
• State and local workers: 16, million (earning $36 per hour over private industry's #24)
• Unpaid taxes by federal workers in 2006: $2,799,950,165.
• State and local government unfunded, retiree medical benefits: $1 trillion or more
• Federal unfunded obligation to pay medical costs for retired federal workers and military personnel: has a $1.2 trillion
  
• Medicare and Social Security push the nation’s unfunded promises above $52 trillion.” (Recall, the Democrats removed the lock box, the trust money we put in, and said the general revenue will pay social security. "General Revenue" means your grandchildren.)
  

All this and no one is held to any standard of performance. Oh, Obama just added some $17 trillion in debt. Forgot that. There is really no need to attempt to be accurate here, is there?

Vote against every incumbent, keep you children away from public schools, and remove yourself from the trough. That's it, other than moving away. Let it collapse.

It will come to pass the more people work, the less you keep, so get out the back, jack, and make a new plan. Don't forget, get out of the dollar.

Europe has tried this new "change" generations ago and are yelling, now, at the U.S. to stop. As the retired Check President put it, the new stimulus plan is the road to hell. But, what would someone who grew up under Marxist rule know?

------

Irene has been busy, so I will file some of her work here. SO YOU CAN STOP, NOW! All you need to know about Freddie and Fannie is below.

I am even behind on this reporting job. Too much going on.

First, requiescat in pacem:

Chicago's Sun-Times Media files for Chapter 11

By David B. Wilkerson, MarketWatch

Last Update: 8:43 AM ET Mar 31, 2009

CHICAGO (MarketWatch) -- Sun-Times Media Group Inc. has become the second newspaper publisher in the Chicago area, and the latest among several around the U.S., to file for Chapter 11 bankruptcy protection at a time of unprecedented advertising revenue declines in the newspaper industry. [Say, why does advertising decline, I wonder? I thought it was people were not buying the paper, but it could be Bush's fault.]

Rival Tribune Co., publisher of the Chicago Tribune, the Los Angeles Times and the Baltimore Sun, filed for bankruptcy last December....

I give even odds that Nancy Peliosi will now recommend bailing out leftists papers. Why not? What's a few billion, anyway, if you can keep the propoganda arms open?

"We must ensure that our policies enable our news organizations to survive and to engage in the news gathering and analysis that the American people expect," Pelosi wrote.

The game is this: get the U.S. Attorney General to say that TV, radio, and Internet are part of the news game; hence, they are big bad anti-trust bears causing her base to collapse. It is the rich people, herself excluded, who are causing newspapers to lose readers by providing free news. You know the next steps are to go after radio and give money to the papers so thay can continue to provide" the news gathering and analysis that the American people expect." The problem is, they know what to expect and are going elsewhere.

Now, there was some disbelief that any Democrat could have done anything bad that resulted in the collapse of the economy, so...

FREDDIE, FANNIE, CONGRESS, CLINTON, et al.

Here is a quick video covering the history of Fannie and Freddie. If you listen and do not come away with the opinion that Big Brother is not manipulating information and opinion, then I hope enjoy the choir.

If you are still in doubt that Clinton (Cuomo), Emmanuel, and Raines killed off the economy, you could read here. You may not be up on this as it is not politically correct to mention truth, because Bush did everything bad, like try to rein in Fannie Mae in 2005.

There has been no free market in housing or finance. Government has long exercised massive control over the housing and financial markets--including its creation of Fannie Mae... -leading to many of the problems being blamed on the free market today.... {Forbes}

What is the source of the explanation of the Democrats' philosphy and action in this matter? The New York Times.

Oh, its the NYT of 1999, not today, as they now say the Clinton era actions could not have caused anything bad. Of course not.

So, there being no longer any argument over what they did, the left has to adopt the argument that it didn't matter. It is hard keeping shifting arguments straight, no? If you didn't check it out, at the top if the page is a link to the beginning of 1984. Check it out, there is nothing new under the sun, as Terence said.

At least, Dodd's amazing lying history is bubbling to the surface, now that the dull-witted media is sratching its collective butt and wondering what happened.

-----

Quoted here, spokesperson from American Economic Institute in the 1990's,

From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.

Forbes has a recent article called The Government Did It.

...All this overlooks a crucial fact: There has been no free market in housing or finance. Government has long exercised massive control over the housing and financial markets--including its creation of Fannie Mae (nyse: FNM - news - people ) and Freddie Mac (nyse: FRE - news - people ) (which have now amassed $5 trillion in liabilities)--leading to many of the problems being blamed on the free market today....

Below is from the American Thinker, just recently published. Recall Raines is Obama's confidant and was appointed by Cuomo.

...Fannie and Freddie became big contributors to the Democratic Party. The sub-prime business paid off-at least while the bubble was growing. And the Kerry, Hillary and Obama campaigns have numbered among the leading recipients of the largess of the two mortgage lenders.

Franklin Raines, the Fannie Mae C.E.O. from 1999 to 2004, had been budget director in the Clinton administration. The left would not like you to be reminded that Raines has been a consultant to the Obama campaign, according to the Washington Post, and that Freddie and Fannie number among the top 5 contributors to Obama's run for the presidency. Raines is being sued for the recovery of 50 million in compensation acquired by the alleged manipulation of Fannie's books. Now, that's not change we can believe in. That's Washington as we have come to know and "love" it.

The Bush administration in 2003 tried to change the system, to no avail. Congressman Barney Frank, (D, MA ) was in the forefront of stopping the Bush proposal to take control out of Fannie and Freddie and put it into a third overseeing organization. Frank too has emerged in the current crisis as one of the major critics of the administration.

Former Federal Reserve Chairman Alan Greenspan continued to raise the alarm over Fannie's and Freddie's weak capitalization. His concerns were ignored.

Former Congressman Michael Oxley (R,OH), then chairman of the House Financial Services Committee and co-author of the Sarbanes-Oxley Act, introduced a bill in 2005 in response to the growing problem, but Fannie and Freddie put their lobbyists to work and the bill died.

Democratic Senator Chris Dodd, who is now Chairman of the Banking Committee and who appears along side Majority Leader Harry Reid on television to discuss the current bailout negotiations, has had harsh words for the Bush administration for its alleged role in the crisis.

But the rest of us should have some harsh words for Senator Dodd. After all, the Bush administration in 2003 and Senator Phil Gramm even earlier, in 1999, had been working to change the system. Dodd, like Obama, has been a big recipient of campaign funds from Fannie and Freddie, organizations that Dodd oversees. Dodd has apparently been more consumed with campaign contributions from the mortgage giants than the responsibilities of oversight...

NY Post:

...Flexible lending programs expanded even though they had higher default rates than loans with traditional standards. On the Web, you can still find CRA loans available via ACORN with "100 percent financing . . . no credit scores . . . undocumented income . . . even if you don't report it on your tax returns." Credit counseling is required, of course.

Ironically, an enthusiastic Fannie Mae Foundation report singled out one paragon of nondiscriminatory lending, which worked with community activists and followed "the most flexible underwriting criteria permitted." That lender's $1 billion commitment to low-income loans in 1992 had grown to $80 billion by 1999 and $600 billion by early 2003.

Who was that virtuous lender? Why - Countrywide, the nation's largest mortgage lender, recently in the headlines as it hurtled toward bankruptcy....

I don't know what else can be said. There are facts and there is the Obama Nation. Those of us who follow the factual path have to, now, deal with the coming train wreck. It is inevitable.

You know, I even feel sorry for the deer on the track watching the train with hope. The Bible has Jesus saying, "Forgive them, they know not what they do."

You should forgive the sinner, but never the sin. Ignorance will bring destruction to those who watch the train light approaching, but the train wreck can take out those who are trying to get away. Again, get away.

Brown Shirts, commercial framing, and economic chaos

The kill-off-organic-and-home-farm bill is still moving along, as is the Brown Shirt bill. It is a really good idea for the Post Office to control our food supply.  Your visit to the farmer's coop will be different. Vendors will watch you warily, lest you are an inspector. (There is a penalty of up to $1 million and jail time if you don't do what the government tells you, like use Monsanto chemicals.)

Under the pending Brown Shirt bill, if a school takes federal money, it must include in all classes the Brown Shirt curriculum.  A group is set up to study the creation of a mandatory membership in the Brown Shirts. I think I read about that in the Constitution.

I hope you see how the government is nothing but a pusher - and it is using your money to hook you.

So what, the NCAA is on.  Who cares.  Right. You can always write a letter to you Congressperson after your grandchildren report to their teachers about your carbon use and unplusgood thoughts. 

Some light reading, for a change: 

Part I: Geithner's Plan "Extremely Dangerous," Economist Galbraith Says

Posted Mar 23, 2009 11:08am EDT by Henry Blodget in Investing, Newsmakers, Recession, Banking

Related: ^gspc, ^dji, c, bac, jpm, WFC

From The Business Insider, March 23, 2009:

Tim Geithner has finally revealed his plan to fix the banking system and economy. Paul Krugman, James Galbraith, and others have already trashed it.

[We spoke with noted economist Galbraith this morning. In the accompanying segment, he calls the Treasury Secretary’s plan “extremely dangerous.”]

Why?

In short, because the plan is yet another massive, ineffective gift to banks and Wall Street. Taxpayers, of course, will take the hit

Why does Tim Geithner keep repackaging the same trash-asset-removal plan that he has been trying to get approved since last fall?

In our opinion, because Tim Geithner formed his view of this crisis last fall, while sitting across the table from his constituents at the New York Fed: The CEOs of the big Wall Street firms. He views the crisis the same way Wall Street does--as a temporary liquidity problem--and his plans to fix it are designed with the best interests of Wall Street in mind.

If Geithner's plan to fix the banks would also fix the economy, this would be tolerable. But no smart economist we know of thinks that it will.

We think Geithner is suffering from five fundamental misconceptions about what is wrong with the economy. Here they are:

The trouble with the economy is that the banks aren't lending. The reality: The economy is in trouble because American consumers and businesses took on way too much debt and are now collapsing under the weight of it. As consumers retrench, companies that sell to them are retrenching, thus exacerbating the problem. The banks, meanwhile, are lending. They just aren't lending as much as they used to. Also the shadow banking system (securitization markets), which actually provided more funding to the economy than the banks, has collapsed.

The banks aren't lending because their balance sheets are loaded with "bad assets" that the market has temporarily mispriced. The reality: The banks aren't lending (much) because they have decided to stop making loans to people and companies who can't pay them back. And because the banks are scared that future writedowns on their old loans will lead to future losses that will wipe out their equity.

Bad assets are "bad" because the market doesn't understand how much they are really worth. The reality: The bad assets are bad because they are worth less than the banks say they are. House prices have dropped by nearly 30% nationwide. That has created something in the neighborhood of $5+ trillion of losses in residential real estate alone (off a peak market value of housing about $20+ trillion). The banks don't want to take their share of those losses because doing so will wipe them out. So they, and Geithner, are doing everything they can to pawn the losses off on the taxpayer.

Once we get the "bad assets" off bank balance sheets, the banks will start lending again. The reality: The banks will remain cautious about lending, because the housing market and economy are still deteriorating. So they'll sit there and say they are lending while waiting for the economy to bottom.

Once the banks start lending, the economy will recover. The reality: American consumers still have debt coming out of their ears, and they'll be working it off for years. House prices are still falling. Retirement savings have been crushed. Americans need to increase their savings rate from today's 5% (a vast improvement from the 0% rate of two years ago) to the 10% long-term average. Consumers don't have room to take on more debt, even if the banks are willing to give it to them.

The two charts below from Ned Davis illustrate the real problem: An explosion of debt relative to GDP. The first is Nonfinancial Debt To GDP. The second is Total Debt To GDP.

In Geithner's plan, this debt won't disappear. It will just be passed from banks to taxpayers, where it will sit until the government finally admits that a major portion of it will never be paid back.

For more coverage including charts, see The Business Insider.

Part II: Geithner, Obama Kowtowing to "Massively Corrupted" Banks, Galbraith Says

Posted Mar 23, 2009 12:07pm EDT by Aaron Task in Newsmakers, Banking

Related: XLF, FAS, SKF, C, BAC, JPM, ^DJI

Like it or not, many people seem to be resigned to the idea there's no alternative to the public-private investment fund scheme Treasury Secretary Geithner detailed this morning. (Click here for part one of our discussion of the plan.)

That's hogwash, says University of Texas professor James Galbraith, author of The Predator State. Of course there's an alternative: FDIC receivership of insolvent banks.

Aside from being legally proscribed, the upside of FDIC receivership is the banks are restructured and reorganized for potential sale (either in whole or parts), Galbraith says. Such was the fate in 2008 of, most notably, Washington Mutual and IndyMac.

Crucially, FDIC receivership also means new management teams for insolvent banks; and Galbraith notes new leaders will have no incentive to cover up the fraudulent or predatory lending practices of their predecessors. Given the entire system was "massively corrupted by the subprime debacle," the professor believes criminal prosecutions on par with the aftermath of the S&L crisis - when hundreds of insiders went to jail - is a likely (and necessary) outcome of the current crisis.

But don't expect to see many "perp walks" if Geithner's current plan comes to fruition. That's one reason Galbraith called the plan "extremely dangerous" in part one of our interview.

So why isn't the Obama administration pushing for FDIC receivership? "Political influence of big banks," the economist says.

----

One Small Problem with Geithner's Plan: It Will Bankrupt the Banks

Posted Mar 25, 2009 09:54am EDT by Henry Blodget in Investing, Recession, Banking

Related: aig, c, bac, wfc, xlf, ^gspc, ^dji

From The Business Insider, March 25, 2009:

The big problem with Tim Geithner's plan to fix the banks is the same as it ever was: The gap between what banks say their assets are worth and what the market says they are worth.

When a bank says an asset is worth 60 cents and the market says it's worth 30 cents, someone has to cover that spread. The genius of Geithner's plan is that it pawns most of the cost (and most of the risk) off on the taxpayer without the taxpayer noticing.

But unless the taxpayer gets stuck with the entire spread, which is probably what Geithner is hoping, banks that sell assets will have to take massive writedowns. This will start the whole cycle of violence again.

This risk to the banks is particularly acute when dealing with whole loans that the banks currently say they have no plans to sell. These loans are often carried at 100 cents on the dollar, because loans classified as held to maturity don't have to be marked to market. Even subsidized buyers won't likely be willing to pay anywhere near 100 cents on the dollar for these loans. So, here, the writedowns could potentially be huge.

And then there's another problem:

If the banks go through the exercise of putting assets up for sale only to have the bids come in at, say, 40 cents instead of the 60 cents on the books, the banks' accountants and/or federal regulators might notice. So even if the banks recoil in horror and refuse to sell at 40 cents, someone somewhere might insist that assets now carried at 60 cents be written down to 40 cents (after all, they won't have the "temporary illiquidity discount" excuse anymore, will they?). This will blow another huge hole in the banks' balance sheets.

Given this, banks would probably be wise not to participate in Geithner's plan. Which is why the government is already talking about forcing them to:

FT: “The unspoken fear here is that selling off loan portfolios would lead to more government capital injections into major banks,” said an executive at a large bank...

Richard Bove, an analyst at Rochdale Research, wrote in a note to clients: “[The plan] will not happen because it would destroy bank capital. It might cause a bank to fail the new stress tests under way. Banks will not take this risk.”

But while banks in theory have discretion over whether to sell loans, Sheila Bair, chairman of the Federal Deposit Insurance Corporation, said this decision would be made “in consultation with regulators” – a sign that the authorities might put pressure on banks to sell toxic assets.

It's time to face the fact that we have already de facto nationalized the big banks--and that the way we've done it is worse than standard receivership and restructuring. The longer we remain in denial about this, the worse off we'll be. But that's another story...

For more coverage, see The Business Insider.

Gold and the Amero

Came across the blog, below, while searching around the gold world. It is from November. I didn't know who Edelson was so I found a little resume and it is at the end. This is important stuff, sorry it is long. Don't ignore the train, it may be coming at you.

Even if Edelson is semi crazy, he is reflecting what his profession is saying. If he is not crazy, then you must buy gold or gold stocks asap.

Fit in these ideas when you read. Since even even knew the world was imploding and bought gold, then those in power have known for years.

1. Early in the Bush years, Mexico, Canada, and the US met to discuss the new union here. They began work on the Amero, the new dollar, and we have people in DC working on it now. There is a straight ahead operation afoot that seemed to make no sense, at the time. Corsi in Salon
Video
Dept of Commerce goes to amazing lengths to say the "SSP" is not the N.A. Union that Obama, in the above video, says has been "ginned up" after asking to be reminded of the name. Methinks the lady doth protest too much.
Snopes pooh-poohs the notion that the coins were being produced, the one you see above for sale. Snopes is part of the left's machine, so it is not an honest source, though it does throw out interesting facts. The above coins are now privately offered collectors items. I suppose if the Amero comes into fuition, they would be a great collectors item.

A side note:

2006: ...The billions of dollars China has invested in the flagging American economy will be worthless. They will have to negotiate the exchange rate to the new amero. This will then force the creation of the North American Union. The cloak of the NAU, fashioned in secrecy, will be thrown over an unsuspecting public, erasing the borders of three countries. Mexico, which already has legions of its citizens living and working inside America, is, in effect already inside the NAU. Their governments will inform the American and Canadian people that there is no option but the bread line.Unfortunately, the plan, which has been in place for some time, now, has been all but ignored by the mainstream media.One of the signs that the NAU is on its way is the collapse of the American greenback dollar paving the way for the debut of the ‘amero’.”Two analysts who have reconstructed money supply data after the Fed stopped publishing it argue a coming dollar collapse will set the stage for creating the amero as a North American currency to replace the dollar,” (WorldNetDaily, Dec. 13, 2006).The euro followed the same blueprint of stealth and surprise. It was already issued as replacement currency before the masses could coalesce to fight it....

2. If you thought the dollar was about to be executed, or any currency, in order to screw creditors, what you do as President? Spend like crazy and let the inflation go.

3. Gold is being held down at great expense and effort. It wants to go up. When it does mover a bit, it goes down. Gold folks are confused, with good reason, as they hear about rapid inflation predicted by the government and gold prices don't move too much. Just look at the Goolge chatter.

4. Why was Bush so non-Republican and why is the GOP mute on subjects of great importance to normal Americans, those who want to defend the border, protect the Constitution, stop idiotic spending and interference in people's rights. This always had my attention. All the GOP had to do was champion the taxpayers and close the borders; there would have been a blood bath as people had a place to turn.

I am sure you can come up with other pieces that would fit this puzzle

Adrian Ash 2007:

As for the world’s central banks, they seem to done a pretty bad job of “covert selling” since the start of this decade. The gold price has now doubled for US investors and savers, and it’s pretty much doubled for British and European gold owners, too. Japanese gold prices have more than tripled.

How come? Whatever the reality of active, covert manipulation, the world’s central banks do indeed control the gold price, as former Federal Reserve governor Wayne Angell put it in 1993.

“The price of gold is pretty well determined by us…But the major impact on the price of gold is the opportunity cost of holding the US dollar…We can hold the price of gold very easily; all we have to do is to cause the opportunity cost in terms of interest rates and US Treasury bills to make it unprofitable to own gold.”...

I can't pretend to know the in and out of all this, we may be going on a gold standard of some type and it may or may not be legal to hold gold, but something smells now. Where there is stink, there are governments and banks at work; oh, to help the people.

The G-20’s Secret Debt Solution

by Larry Edelson 11-13-08

If you think this weekend’s G-20 meetings in Washington are only about designing short-term fixes to the financial system and regulatory reforms for banks, hedge funds, brokers, mortgage companies and investment banks … think again.

Behind the scenes, a far more fundamental fix is being discussed — the possible revaluation of gold and the birth of an entirely new monetary system.

I’ve been studying this issue in great depth, all my life. And given the speed at which the financial crisis is unfolding, I would be very surprised if what I’m about to tell you now is not on the G-20 table this weekend.

Furthermore, I believe the end result will make my $2,270 price target for gold look conservative, to say the least. You’ll see why in a minute.

First, the G-20’s motive for a new monetary system: It’s driven by and based upon this very simple proposition …

“If we can’t print money fast enough to fend off another deflationary Great Depression, then let’s change the value of the money.”

I call it …

“The G-20’s Secret Debt Solution”

It would be a strategy designed to ease the burden of ALL debts — by simultaneously devaluing ALL currencies … and re-inflating ALL asset prices.

That’s what central banks and governments around the world are going to start talking about this weekend — a new financial order that includes new monetary units that helps to wipe clean the world’s debt ledgers.

It won’t be an easy deal to broker, since the U.S. is the world’s largest debtor. But remember: Debts are now going bad all over the world. So everyone would benefit.

Fed Chairman Ben Bernanke … Treasury Secretary Paulson … President Bush … President-elect Obama … former Fed Chairman Paul Volcker … Warren Buffett … and central bankers and politicians all over the world agree a new monetary system is needed.

So they’ll start hashing out the details to get the new financial architecture deployed as quickly as possible.

If you think I’m crazy or propagating some kind of conspiracy theory, then consider the historical precedent …

To end the Great Depression in 1933 Franklin Roosevelt devalued the dollar via Executive Order #6102, confiscating gold and raising its price 69.3%, effectively kick starting asset reflation.

Only this time, it won’t be just the U.S. that devalues its currency. The world is too interconnected. Instead, the world’s leading countries will propose a simultaneous and universal currency devaluation.

This time, they will NOT confiscate gold. There would be riots all over the globe if they even mentioned the “C” word.

But they don’t have to confiscate gold. Here’s one scenario …

They cease all gold sales and instead, raise the current official central bank price of gold from its booked value of $42.22 an ounce — to a price that monetizes a large enough portion of the world’s outstanding debts.

That way, just like in 1933, the debts become a fraction of re-inflated asset prices (led higher by the gold price).

And this time, instead of staying with the dollar as a reserve currency, the G-20 issues three new monetary units of exchange, each with equal reserve status.

The three currencies will essentially be a new dollar, new euro, and a new pan-Asian currency. (The Chinese yuan may survive as a fourth currency, but it will be linked to a basket of the three new currencies.)

The new fiat monetary units would be worth less than the old ones. For instance, it could take 10 new units of money to buy 1 old dollar or euro.

New names would be given to the new currencies to help rid the world of the ghost of a system that failed. Additional regulations and programs would be designed and implemented to ease the transition to a new monetary system.

The IMF would be at the center of the new monetary system.

The International Monetary Fund (IMF) would implement the new financial system in conjunction with central banks and governments around the world.

Keep in mind that the IMF is already set up to handle the transition, and has had contingency plans allowing for it since the institution was formed in 1944.

Included in the design and transition to a new monetary system …

A. A new fixed-rate currency regime. Immediately upon upping the price of gold and introducing the new currencies, a new fixed exchange rate system would be re-introduced. The floating exchange rate system would be tossed into the dust bin along with the old currencies.

This would kill any speculation about further devaluations in the currency markets, and drastically reduce market volatility.

B. To sell the program to savers and protect them from the currency devaluation, compensatory measures would be enacted. For instance, a one-time windfall tax-free deposit could be issued by governments directly to citizens’ accounts, or, to employer-sponsored pensions, to IRAs, or Social Security accounts.

Income taxes may subsequently be raised to pay for the give-away, or a nominal global type of sales tax could be enacted to help pay for the new system and the compensatory measures.

C. Additional programs would be designed to protect lenders and creditors. Lenders stand a much higher chance of getting paid off under the new monetary system — but with a currency whose purchasing power would now be a fraction of what it was when the loans were originated.

So programs would have to be designed to help lenders offset the inflationary costs of their devalued loans, probably via the tax code.

Naturally, all this is a bit more complicated than I’ve spelled out above. But that gives you a big-picture outline of what the plan could look like. And I think major changes like these are going to be set in motion at this weekend’s G-20 meetings in Washington.

Would they work?

Yes. They would help avoid a repeat of the deflationary Great Depression. But don’t expect even a new monetary system to put the U.S. or the global economy back on track toward the high rates of real growth that we’ve seen over the last several years. That’s simply not going to happen. Not for a while.

Instead, I’m talking about a massive asset price reflation, negative real economic growth in the U.S. and Europe — but continued real GDP gains in Asia.

The Big Question: What gold price would be legislated to reflate the U.S. and global economy?

I can’t tell you what gold price the G-20 would ultimately agree to. But here’s what they will be looking at …

• To monetize 100% of the outstanding public and private sector debt in the U.S., the official government price of gold would have to be raised to about $53,000 per ounce.
• To monetize 50%, the price of gold would have to be raised to around $26,500 an ounce.
• To monetize 20% would require a gold price a hair over $10,600 an ounce.
• To monetize just 10%, gold would have to be priced just over $5,300 an ounce.

Those figures are just based on the U.S. debt structure and do not factor in global debts gone bad. But since the U.S. is the world’s largest debtor and the epicenter of the crisis, the G-20 will likely base their final decision mostly on the U.S. debt structure.

So how much debt do I think would be monetized via an executive order that raises the official price of gold? What kind of currency devaluation would I expect as a result?

I would not be surprised to see the G-20 monetize at least 20% of the U.S. debt markets. THAT MEANS …

• Gold would be priced at over $10,000 an ounce.
• Currencies would be devalued by a factor of at least 12 to 1, meaning it would take 12 new dollars or euros to equal 1 old dollar or euro.

The return of the Gold Standard?

“But Larry,” you ask, “how could this be accomplished when we no longer have a gold standard? Further, are you advocating a gold standard?”

If the G-20 monetizes at least 20% of the U.S. debt markets, gold could easily hit $10,000 an ounce.

My answers:

First, you don’t need a gold standard to accomplish a devaluation of currencies and revaluation of the monetary system.

By offering to pay over $10,000 an ounce for gold, central banks can effectively accomplish the same end goal — monetizing and reducing the burden of debts, via inflating asset prices in fiat money terms.

Naturally, hoards of gold investors will cash in their gold. The central banks will pile it up. At the same time, other hoards of investors will not sell their gold, even at $10,000 an ounce. But the actual movement of the gold will not matter. It is the psychological impact and the devaluation of paper currencies that matters.

Second, I do NOT advocate a fully convertible gold standard. Never have. There isn’t enough gold in the world to make currencies convertible into gold. It would end up backfiring, restricting the supply of money and credit.

What should you do to prepare for these possibilities?

It’s obvious: Make sure you own some core gold, as much as 25% of your investable funds.

Also, as I’ve noted in past Money and Markets issues, you will want to own key natural resource stocks, and even select blue-chip stocks that will participate in the reflation scheme.

For more details and specific recommendations to follow, be sure to subscribe to my Real Wealth Report.

Best wishes,

Larry Meet Lawrence S. Edelson
Editor, Real Wealth Report:

This "$87 Billion Gold Trader" Is UNIQUELY QUALIFIED to Help YOU Grow Richer in 2004-2005!

• Larry has been actively involved in the precious metals and natural resource investment markets for nearly three decades.
  
  
• In 1978, Larry began his career at Wilcap Advisors, a private money management firm that specialized in gold and silver.
  
  
• In 1982, Larry joined Emanuel Capital Management as a senior trader, managing several million dollars in precious metals.
  
  
• During this time, Larry became one of the largest gold arbitrage traders in the world, trading in contracts worth as much as 700,000 ounces of gold in a week, which is the equivalent of $87 billion (in 2004 dollars) in gold annually.
  
  
• In 1982, Larry founded International Commodity Services, Inc., an international commodity brokerage firm with agency offices in Hamburg, Munich, Dusseldorf and Osaka, Japan.
  
  
• Larry's analysis of natural resources and precious metals is frequently sought out by the Financial Times of London, Bloomberg, CBS MarketWatch and other major media outlets.

People comment on their own states

It is good to get a perspective. People around here don't realize what America is like, having grown up in NY. That probably explains the in-bred thinking.

Look at the present governor who is actually doing something to address the economic collapse of the state. He is rejected by his own party. Unions run ads against him because, even though things are bad and the fix will hurt, our workers are special, you moron - tax the rich. Patterson lives in the real world and knows the rich will just leave.

NY will elect Cuomo over Patterson, according to polls, and no one even knows he triggered the housing collapse, the heart of the financial crisis. We are dealing with automatons.

Me I think Cuomo is perfect. Destroy the state, run it right into bankruptcy. Its the only way out.

I am a Vermont resident, technically, but that is just a theme park for the flakiest of the left who leave NY, NJ, and Boston. New Hampshire is starting to look good.

To state the obvious, look at the best and worst states and, then, put them in a philosophical box. You get a hint about people's world view (or lack of it) and what happens when you get a bunch of them in one state.

Posted: March 13, 2009
11:45 pm Eastern

By Bob Unruh

---

WorldNetDaily

A new study indicates the states with the most freedom are South Dakota, New Hampshire and Colorado, while Americans see the most complete government control of their personal lives in New York, New Jersey, Rhode Island, California and Maryland.

"On personal freedom alone, Alaska is the clear winner, while Maryland brings up the rear. As for freedom in the different regions of the country, the Mountain and West North Central regions are the freest overall while the Middle Atlantic lags far behind on both economic and personal freedom," said the study, Freedom in the 50 States: Index of Personal and Economic Freedom.

The study was conducted by Jason Sorens of the University of Buffalo and William P. Ruger of Texas State and release through the Mercatus Center at George Mason University.

The researchers say their work "presents the first-ever comprehensive ranking of the American states on their public policies affecting individual freedoms in the economic, social, and personal spheres."

The study made its assessments by defining individual freedom as the "ability to dispose of one's own life, liberty, and justly acquired property however one sees fit, so long as one does not coercively infringe on other individuals' ability to do the same."

Specifically, it includes measures of social and personal freedoms such as peaceable citizens' rights to educate their own children, own and carry firearms, and be free from unreasonable search and seizure. It includes more variables than prior studies.

The results can be used by lawmakers concerned about liberty and by business owners who are considering new investment priorities, the authors said. Individuals can use the results to determine moves and retirement options.

The authors said their understanding of freedom "follows from the natural-rights liberal thought of John Locke, Immanuel Kant and Robert Nozick, but it is also consistent with the rights-generating rule-utilitarianism of Herbert Spencer and others."

It includes the belief in the efficiency and morality of unhampered markets, the system of private property and individual rights and a "deep distrust of taxation, egalitarianism, compulsory welfare and the power of the state."

"Our definition of freedom presents specific challenges on some high-profile issues. Abortion is a critical example. On one account, the fetus is a rights-bearing person, and abortion is therefore an aggressive violation of individual rights that ought to be punished by government. On another account, the fetus does not have rights, and abortion is a permissible exercise of an individual liberty, in which case government regulation of abortion would be an unjust violation of a woman’s rights. Rather than take a stand on one side or the other (or anywhere in between), we have coded the data on state abortion restrictions but have not included the policy in our overall index," the study authors cautioned.

Issues considered for various parts of the study include the use of marijuana, state and local government budgets, gun registration and dealer registration demands, restrictions on alcohol sales, camera surveillance, bicycle helmet laws, gambling rules, fireworks restrictions, compulsory school requirements, insurance rules.

The overall order of states, from most free to least free, with the study's numerical values, were: 1. New Hampshire 0.432; 2. Colorado 0.421; 3. South Dakota 0.392; 4. Idaho 0.356; 5. Texas 0.346; 6. Missouri 0.320; 7. Tennessee 0.284; 8. Arizona 0.279; 9. Virginia 0.275; 10. North Dakota 0.268; 11. Utah 0.250; 12. Kansas 0.210; 13. Indiana 0.208; 14. Michigan 0.206; 15. Wyoming 0.193; 16. Iowa 0.183; 17. Georgia 0.146; 18. Oklahoma 0.143; 19. Montana 0.125; 20. Pennsylvania 0.102; 21. Alabama 0.092; 22. Florida 0.068; 23. North Carolina 0.019; 24. Nevada 0.013; 25. Mississippi -0.004; 26. Delaware -0.008; 27. Oregon -0.009; 28. Nebraska -0.018; 29. Arkansas -0.023; 30. South Carolina -0.040; 31. Alaska -0.071; 32. Kentucky -0.082; 33. West Virginia -0.097; 34. Louisiana -0.110; 35. Minnesota -0.111; 36. New Mexico -0.150; 37. Wisconsin -0.199; 38. Ohio -0.205; 39. Maine -0.214; 40. Vermont -0.217; 41. Connecticut -0.225; 42. Illinois -0.238; 43. Massachusetts -0.242; 44. Washington -0.275; 45. Hawaii -0.304; 46. Maryland -0.405; 47. California -0.413; 48. Rhode Island -0.430; 49. New Jersey -0.457; 50. New York -0.784.

The online report also includes detailed descriptions for each state.

For example, Alaska, although it has great personal freedom, has a problem regarding freedom is its fiscal policy.

"Over a quarter of the state’s workforce is employed by state or local government, and that figure does not include federal employees. Alaska has the third highest debt ratio in the country and the second highest state and local government spending ratio. However, Alaska does extremely well on personal freedom, scoring first on our ranking," the profile states.

California, the study implies, should be avoided:

"Contrary to popular perception, California not only taxes and regulates its economy more than most other states, it also aggressively interferes in the personal lives of its citizens. California ranks No. 48 on economic freedom and No. 37 on personal freedom. California simply needs to cut government spending. The budgetary categories most out of line with the rest of the country are public safety, natural resources and environment, and administration."

Highly rated Colorado gets its endorsement through "excellent fiscal numbers and above-average numbers on regulation and paternalism. [The Taxpayers Bill of Rights], though suspended as of this writing, is surely responsible for some of Colorado’s fiscal sanity. The state is the most fiscally decentralized in the country, with localities raising fully 44.5 percent of all state and local expenditures. … "

Nationalizing the swamp

So, invest in Citibank at $1.25. AIG, as well. The government is now going to make sure they don't fail.

UPDATE 1-U.S. bank rescue plan could come on Monday - WSJ
Fri Mar 20, 2009 11:55pm EDT Email | Print | Share | Reprints | Single Page [-] Text [+]
(Adds details from WSJ report, New York Times, background)

NEW YORK, March 20 (Reuters) - The U.S. government will announce as soon as Monday a long-awaited plan to try to get bad assets off the books of banks, a cornerstone of its efforts to tackle the credit crisis, The Wall Street Journal reported.

The Obama administration, battling a deepening recession, is set to adopt a three-pronged approach to ridding the financial system of so-called toxic assets, the newspaper and the New York Times said on their websites on Friday.

The plan would create an entity, backed by the Federal Deposit Insurance Corp, a U.S. banking regulator, to buy and hold loans, the reports said.

It would expand a newly launched Federal Reserve facility -- that lends money to investors to buy securities backed by consumer loans -- to include toxic assets. And it would create new public and privately financed funds to buy such securities under the management of private investment experts.

The Obama administration plans to contribute between $75 billion and $100 billion in new capital to the effort although that amount could be expanded, the Wall Street Journal said.

The Treasury Department and Federal Reserve declined to comment. Sources familiar with the government's thinking have told Reuters details of a plan could be announced next week.

The Bush administration tried without success late last year to set up a mechanism to get bad assets off the balance sheets of commercial banks.

The banks have been hammered by losses incurred by mortgage-related debt that has turned sour amid a fall in house prices and a pickup in defaults, sparking a credit crisis that has strangled the U.S. and global economies.

Obama's Treasury secretary, Timothy Geithner, has outlined a new proposal to soak up as much as $1 trillion in assets through a public-private program.

But investors have grown increasingly concerned that his efforts are running into problems more than a month after he outlined the plan.

The slow start of the new Federal Reserve consumer lending program this week has been seen as a sign that private capital may shun the toxic-asset plan because of public outrage over large executive bonuses.

Many big private investors are worried they could face tough new rules in U.S. financial rescue programs after Congress pressed ahead with efforts to claw back bonuses paid to executives at failed insurer American International Group (AIG.N).

The Wall Street Journal said the Treasury would match private sector finance for the public-private toxic asset funds on a one-for-one basis in most cases.

Washington would be a co-investor also in the new FDIC troubled loans program but could contribute 80 percent in some cases, and would guarantee as much as $500 billion in loans investments, the newspaper said in its report.
The New York Times said the FDIC program could involve government funding for up to 97 percent of the equity.

It also said the plan is likely to offer generous taxpayer subsidies, in the form of low-interest loans, to coax investors to form partnerships with the government. (Editing by Peter Cooney & Jan Dahinten)

DEFCON 4: TradeKing's view of the Fed

Asset ideas:

I actually funded, albeit modestly, my TradeKing account. Believe it or not I may speculate in AIG. Citi may be too late for speculation.

Don't get me wrong, such moves are just good bets with good odds. No real investing going on, in the true sense, unless my horses come in. Then, I am a great investor.

Below is the commentary from TradeKing's blog where the writer compares Washington to the military being in DEFCON 4.

I want to make a little investment based upon the notion that holding cash is stupid, and as I can't afford much gold, I may as well try to outrun the dollar. To my mind, AIG and Citi will not fail and their stock prices are so low, you are at the bottom. This is the time honored blood-in-the-streets investment approach.

The companies will not fail because the government won't let them. The government, which used to mean "we," are major stake holders in the companies. Congress and the prez want to proclaim they run things, not preside over massive collapse - and lose their seats.

There is no hint of letting them die, in fact Bernake assured the American people on 60 Minutes he would not let the big banks fail. OK, I take him at his word and since he can just hand over money, I see Citi as safe from bankruptcy. If not, one less day at the track.

AIG's Liddy told Congress he see a repayment to Congress in two to three years. He mentioned the "bonuses" were promised to individuals to keep experts around to sell toxic assets. They did - to the tune of 1 trillion. Again, I don't see AIG failing, now, as it is sort-of nationalized and on the way to recovery. Mr. Obama has pooh-poohed all the hysteria about taxing bonuses because he doesn't want the private investors to back away from dealing with the Reich, not because it was illegal. With each day, AIG gets better, rather than worse.

Colin suggested a bret on Ford is a good idea. Another near bankruptcy price. So, are the odds good it will not fail (If it doesn't then it will go to up, at least, 10 time today's cost)? Recall, Ford did not take money from the feds. This means something. Also, as it does during every recession, the market will come back. Cars die and they are essential products. Cars last longer these days, but commerce will pick up. At some point, the pent up buying will be let go. To my mind, then, there is a play here, but I will look closely. Who knows if it is long term.

I may buy a gold mine, as well. That is a good leverage position.

TradeKing blog:

(Updated: 4:30pm CT) The FOMC statement appears to have been written in DEFCON 4 status. A new term lending facility has been announced. It will accept even less credit worthy collateral than the previous multitude of term lending facilities do. They are in panic mode as well they should be. NOT ONE WORD IS WHISPERED AS TO ANY IMPROVEMENT IN ANY SECTOR OF THE ECONOMY SINCE THE LAST REPORT. The only thing the Fed has done in over a year is to open one lending facility after another and print more money to fund them. Oh wait, I'm lying.

They have also continued to say they are and have been optimistic during this same time period. Optimism, confidence and continued bungling in the financial laboratory do nothing for our economy. This "in for a dime, in for a trillion" game is insane.

In previous posts I told you this next item was coming. The first breath of air has just been injected into the next bubble. The T Bill market to be exact. One, potentially more lethal than any Ben has attempted yet. Mark my words. This could be devastating. Ben and his bunch of bananas have announced they will produce another $1trillion out of thin air. $300B of this will be used to purchase Treasury Bonds. The other $700B will be used as a BAILOUT for our esteemed financial institutions. Ben, the caped crusader, doesn't have the balls to call it a bailout, but a rose is a rose is a ...

Do you really believe they will stop at $300B for T Bills when they get the ball rolling?


My take on this:
Why would the Fed find itself buying long term T Bills? Because foreign interests have been selling more of and buying less of the U.S. debt (specifically, Treasuries) they hold. Why are they doing this? Because the ever increasing trillions of pretend dollars that sprout at the Federal reserve gives them well founded doubt that the U.S.will be able to honor its debt going forward. Would you trust someone who owes you money if they were unable to quit borrowing in order that they could continue on an un ending spending spree?

From todays calculatedriskblog.com excerpts from a long post. Well worth the read:
Bernanke's Grand Experiment Continues
Bernanke Has Failed
[Please note that Bernanke has already failed. "It" (deflation) has arrived. And deflation has arrived in spite of the fact that Bernanke has slashed rates to 0%, instituted numerous lending facilities that have all failed, squandered $trillions in taxpayer money, and has already implemented phase II (or do I mean phases 2 through 20) of his plan, that being the "offer fixed-term loans to banks at low or zero interest, with a wide range of private assets as collateral."]... [Note the losing battle Benanke is fighting: attitudes. The Fed has become the lender of only resort as opposed to the lender of last resort. Bernanke cannot force banks to lend nor can he force companies to hire or if they do hire the wages that will be paid.
Wage destruction continues unabated, and if Bernanke does succeed in driving prices higher, he just might ask himself, how anyone is going to pay the bills.]

Tips and News

My choice for president:

March 19 (Bloomberg) -- Senator Judd Gregg, a New Hampshire Republican, predicted Congress’s efforts to rescind American International Group Inc.’s bonuses through higher taxes would be thrown out by the courts. He said the legislation before lawmakers violates the constitutional ban on bills of attainder, which restricts lawmakers’ ability to punish individual Americans.

Keep track of him.


Money Tips:

Interest rates will go down soon, as the fed is buying Treasury Bills. This is part of the game afoot, see prior entry, and will be followed by a reverse dribble in the near term by the fed to create inflation, once it is sure we are not going into a depression. (OK, Greg, once it thinks we won't)

So, if you have any foundation, borrowing money in a few weeks is best, if not recommend (by whom? Me?). Recall, buy something with it - land, stocks, gold, etc. Do not keep cash in the bank. Once inflation sets in, the cost of your loan payments will be go down in real value every day while your investment will rapidly increase as a factor of inflation and the depressed markets.

Facts in Play

1. H.R. 875 and S 425: No more organic farms

Congress/Obama to make organic farming illegal ($500,000 fine if you don't use prescribed chemicals). Little video

This bill is being pushed by Monsanto, as the fascist government can order organic farmers out of business. At least, this will really piss off a key Obama constituency. They may wake up, in the dark of the night, as to what is going on.

There is talk about this law applying to your personal garden, that can't be enforced and will piss off everyone.

In any event, in true capitalist spirit, look at investing in Monsanto.

2. HR 1388: The Brown Shirt Act

H.R.1388
Title: To reauthorize and reform the national service laws.
Sponsor: Rep McCarthy, Carolyn [NY-4] (introduced 3/9/2009) Cosponsors (37)
Related Bills: H.RES.250
Latest Major Action: 3/19/2009 Senate floor actions. Status: Cloture motion on the motion to proceed to the measure presented in Senate.
House Reports: 111-37

---

SUMMARY AS OF:
3/9/2009--Introduced.

Generations Invigorating Volunteerism and Education Act or the GIVE Act - Amends the National and Community Service Act of 1990 (NSCA) and the Domestic Volunteer Service Act of 1973 (DVSA) to revise the programs under such Acts and reauthorize appropriations for such programs through FY2014.

Revises under NSCA: (1) the School-Based and Community-Based Service-Learning programs and Higher Education Innovative Programs for Community Service (Learn and Serve programs); (2) National Service Trust programs (AmeriCorps); (3) the National Civilian Community Corps (NCCC); and (4) the Investment for Quality and Innovation program.

Eliminates the current Community-Based Learn and Serve programs.

Establishes two new Learn and Serve programs: (1) Campuses of Service... (2) Innovative Service-Learning Programs and Research...

Includes among eligible AmeriCorps programs: (1) an Education Corps to address unmet educational needs; (2) a Healthy Futures Corps to address unmet health needs; (3) a Clean Energy Corps to address unmet environmental needs; and (4) a Veterans Corps to address the unmet needs of veterans and their families

3. Following up on yesterday: Since the Democrats specifically wanted AIG bonuses, before saying it was an outrage, and can't, yet, vitiate contracts by royal edict, the house voted to tax the bonuses at 90%. Keep this in mind if you think you are not perceived a slave by the Marxists who think they are progressives.

This tax is called a bill of attainder, a much hated and outlawed process of the king, when we were a colony. I suppose we have another king, who apparently didn't read the constitution he allegedly taught (at least, he taught civil rights, the other stuff requiring academic credentials.)

"Bills of attainder, ex post facto laws, and laws impairing the obligations of contracts, are contrary to the first principles of the social compact, and to every principle of sound legislation. ... The sober people of America are weary of the fluctuating policy which has directed the public councils. They have seen with regret and indignation that sudden changes and legislative interferences, in cases affecting personal rights, become jobs in the hands of enterprising and influential speculators, and snares to the more-industrious and less-informed part of the community." - Alexander Hamilton

4. Cell Phone Tax Fairness Act of 2009 (HR 1521). So, you think you got a break.

The bill, which has 20 additional cosponsors, would ban state or local jurisdictions from imposing "a new discriminatory tax on or with respect to mobile services, mobile service providers, or mobile service property, during the five-year period beginning on the date of enactment of this Act."

The legislation would not affect current state and local taxes, nor would it affect federal taxes, like the FCC Universal Charge. The Federal Excise Tax from the Spanish-American War was disconnected in 2006. (Gee)

[Of note, the Universal Charge is Al Gore's tax to be used to put the Internet into schools, which was completely unnecessary and now is absurd. I think the Federal Government doesn't want the states horning in on its protection racket. If I recall, getting Virgin or Net10 phones means you don't pay those taxes.]

5. That's enough

Preparation and News

SOME USEFUL DATA

Items to consider when figuring out what to do:

1. Including entitlements and pensions, items taken off the reported books, we now owe 55 trillion dollars and it is growing. Quick estimate: that is 55,000,000,000,000 divided by 300,000,000 or 55,000,000/300 = $183,333 of debt for EVERY living American. So figure, each taxpayer now owes, roughly a half of a million dollars, why be accurate, its just money. This is change you can bank on. You didn't know you could carry that much debt, did you? Please let me know if my math is off.

See below for Mr. Obama's off-teleprompter speech: ...when you're in charge, to make sure that stuff doesn't happen like this. So we're going to do everything we can to fix it."

2. Fed Chairman Bernake, whether you agree with Keynesian monetary "policy" or not, told us on 60 Minutes what he will do. He will NOT let the big banks fail. [Buy Citibank? The government now owns 36%] The Fed is going to "stimulate" the economy with low rates until just the right moment, wanting to avoid deflation, then the Fed will jack up the interest rates to into high inflation. [Gold?, but the government will probably render ownership illegal]

A note - the government has no choice, and I mean no choice, but to foster serious inflation so that it can pay down its recent debt binge with cheaper dollars. Smart money, including foreign investors, has no choice but to leave the dollar, if not the United States. Also, who can say whether this plan will do anything to stop a depression? We are betting on a theory only accepted by government.

Higher interest rates only mean something to those borrowing and who will be borrowing during inflation? Who will be lending? Smart money borrows now and sits back, not when the rates take off.

SOME NEWS

1. The news I recently pointed out is now hitting the early detection line, the talk shows. Major media will pick it up, as is usually the case, in a week to a month. The important news is one can't find bullets for sale, even as Congress is considering a plan to make it a crime to own old bullets, not the new registered ones that are highly taxed. If have read about Hitler, Mussolini, Stalin, you see what is going on. Tell me you don't get it.

2. Below is our President going off the teleprompter, as reported by ABC, hardly a critical source. Notice the narcissism, shallowness, and the simplistic socialist agenda as he fixes "stuff." Tell me you don't get it.

We didn't grant these contracts, and we've got a lot on our plate, but it is appropriate, when you're in charge, to make sure that stuff doesn't happen like this. So we're going to do everything we can to fix it."...

"And one of the messages that I want to send is that as we get out of this crisis, as we work towards getting ourselves out of recession, I hope that Wall Street and the marketplace don't think that we can return to business as usual. The business models that created a lot of paper wealth but not real wealth in this country and have now resulted in crisis can't be the model for economic growth going forward," he said....

"Secretary Geithner either didn't know about the bonuses, and was grossly negligent, or he did know and failed to bring this to the president's attention," Rep. Darrell Issa, R-Calif., said Wednesday.

"Timothy Geithner should either resign or be fired for the good of the country, and President Obama should nominate a new treasury secretary with the experience and leadership skills America deserves," Rep. Connie Mack, R-Fla., said in a statement. "Quite simply, the Timothy Geithner experience has been a disaster."

But the president defended his treasury pick...

"I have complete confidence in Tim Geithner and my entire economic team. Understand, as I said before, Tim Geithner didn't draft these contracts with AIG. [Probably not, so what. He approved it as did Dodd] There has never been a secretary of the treasury, except maybe Alexander Hamilton, right after the Revolutionary War, who's had to deal with the multiplicity of issues that Secretary Geithner is having to deal with -- all at the same time,"

"For everyone in D.C. scrambling how to blame someone else, just go ahead and talk to me," the president said, deviating from his prepared remarks, "because it's my job to make sure we fix these messes, even if I don't make them."

Comparing big banks and embattled, scandal-ridden AIG to suicide bombers, Obama said, "Now, a lot of people say, well, why not just let the banks fail? Right? See, somebody is clapping. ... They were making all these bad bets. Why don't we just let them fail, let them go bankrupt? What's the problem?"

"Citicorp or Bank of America or, you know, Wells Fargo that controls 70 percent of the banking system, and all of them are weakening. [Huh, or you know] You can't afford to have all those banks all at once start going under. Even though the deposits might be guaranteed, you've got the entire economy resting on that credit," the president said. "It was the right thing to do, even though it's infuriating, even though it makes you angry. ... Here's the problem, It's almost like they've got a bomb strapped to them and they've got their hand on the trigger. You don't want them to blow up. But you've got to kind of talk them, ease that finger off the trigger." [I am sorry, if you are going to talk down to the least common denominator, his voters, you should, at a minimum, make sense - you know about the mess and that credit and all.]

----------

Lest you are not sensitive to language, aside from the sophomoric vocabulary, note

1. The regal use of I and my

2. He "grants" contracts

3. I hope that Wall Street and the marketplace don't think that we can return to business as usual. You are the marketplace, you know. He is going to fix all your stuff.

4. "The business models that created a lot of paper wealth but not real wealth in this country and have now resulted in crisis can't be the model for economic growth going forward,"

His business model is going to fix the stuff. I didn't know we had a business model that included fraud, stupidity, and governmental interference. It must, as the "model" caused "crisis," not people and events. More shallow thought. I guess the new model will make sure we are all good and the government does not screw things up with politically based regulation.

5. Big banks are suicide bombers, you know. I am not making this up. If I were real suicide bomber, just about now is the time to attack. Can you imagine what our leaders will do? Actually, upon thought, I can't.

After campaigning hard on the need address Afghanistan, the seriously troublesome war, Obama is sending 19,000 troops - after the generals requested 30,000. I guess he know better. The hated Bush actually listened to the generals on the ground, the dope.

I have to go now, my blood pressure and all.