Select Quotes

Democracy has been diluted by the actions we have taken to get out of this crisis.
The government is willing to willy nilly print money to prevent any bank from going into receivership which I think is a galacticly bad idea.
Credit derivatives added to the problems by providing leverage and opacity.
They increased people’s ability to borrow in hidden ways.
There is a lot of debt in the system that is invisible. And banks themselves were often running invisible hedge funds.
The legacy investment banks were running invisible hedge funds, but so were our major banks, and that includes JPMorgan, and Citigroup Bank of America.
Collateralized Debt Obligations (CDOs) were overrated and overpriced the minute they came to market. If that wasn’t enough, investment banks were creating these things in their financial meth labs , knowingly selling things they knew or should have known were overrated and overpriced.
In 2007 when it was clear that this activity should be shut down, because we had mortgage lenders failing throughout the country, instead of shutting down the financial meth labs, the investment banks sped up, they accelerated the bad deals they were bringing to market.
Many of them were just phony secutritizations with no other purpose than to hide losses.
I was hopeful that when someone like Obama came in, there would be meaningful change.
If anything, the situation has gotten worse. But this is bipartisan. You’ll notice that President Bush when he was in office, he elevated Roland Arnold who was the head of Ameriquest, that had been involved in alleged mortgage fraud, massive, sued by almost every state in the union, and he was elevated to the position of Ambassador to the Netherlands.
The Netherlands did not even like it.
This was not a model issue.
This was a management issue. We had people who knew or should have known they were selling things that were value destroying securitizations, and their sale provided money to lenders were originating fraudulent loans, overrated by complicit rating agencies.

Janet Tavakoli is a straight shooter and an equal party basher. You have to like that.
Mike "Mish" Shedlock

Stacy Blog:

Barbarians at the gate of a gas guzzling empire

November 2nd, 2009

by stacyherbert

Stacy Summary: From what I can tell looking at history, all peoples of every empire at its peak, just before its imminent collapse, belligerently maintain their lifestyles at all cost to their own wealth and their own chance of survival. For a number of reasons, you cannot talk them into saving themselves.
While thousands upon thousands of hours are spent in America, for example, trying to prove that spewing exhaust and carbon into the air is, in fact, perfectly natural with zero cost and that there is, also, in fact, (according to one Big Oil study) enough fresh water, fertile land and oil to provide for a doubling of the global consumer class for thousands of years into the future, Americans (most who, by the way, believe the Earth is only a few thousand years old) continue to insist with an almost religious fervor on getting from point A to point B in the most inefficient manner.
Again, from my reading of history, it is impossible to fight this sort of end of empire bankruptcy of morals, wealth and, most importantly, ideas. The American empire and her citizens want to blow it on oil, so that’s how they will do it. No amount of science or reasoning can stop them. And as they will use any means necessary to get whatever oil remains, it makes no sense to try to develop your own economy using a resource that the Empire has devoted all their military might toward securing. The British, Dutch, French, Germans and other Europeans did not dare stand in the way of Spain’s maniacal quest for gold in the New World; instead, they took the gold-less lands and with them developed manufacturing and trade routes in sugar, cotton, wheat, fur, etc. (Power more at )

This is NOT good

Debt Slave Bait and

Audit the Fed Bill Gutted:

What You Can Do

This should come as no surprise but Ron Paul says Federal Reserve Policy Audit Legislation ‘Gutted’Representative Ron Paul, the Texas Republican who has called for an end to the Federal Reserve, said legislation he introduced to audit monetary policy has been “gutted” while moving toward a possible vote in the Democratic-controlled House.
The bill, with 308 co-sponsors, has been stripped of provisions that would remove Fed exemptions from audits of transactions with foreign central banks, monetary policy deliberations, transactions made under the direction of the Federal Open Market Committee and communications between the Board, the reserve banks and staff, Paul said today.
“There’s nothing left, it’s been gutted,” he said in a telephone interview. “This is not a partisan issue. People all over the country want to know what the Fed is up to, and this legislation was supposed to help them do that.” ( Power more at )

Obama creates 640,329 jobs at a

cost of $323,739.83 per job

Inquiring minds are asking the question "How many jobs were created out of the various stimulus programs so far and at what cost per job?"
That is a good question. Not that we can believe the reported number of jobs created, but let's assume for the sake of argument that the figures provided by the administration are correct.
White House Hails Stimulus Jobs
The Financial Times is reporting White House hails 650,000 stimulus jobs.The US economic stimulus programme has directly created or saved 640,000 jobs so far, the White House said on Friday as it battled to find ways to show that its $787bn package was working, despite persistently high unemployment. ( Power more at )

I TOLD YOU LAST JULY CIT WAS BACKRUPT

CIT Group files for prepackaged bankruptcy

Sun Nov 1, 2009 4:24pm EST

NEW YORK (Reuters) - CIT Group Inc, a century-old commercial lender, filed for bankruptcy on Sunday, as the global credit crisis left it unable to fund itself and the recession left it with too many bad loans.
CIT's creditors have already approved its reorganization plan. Analysts have said that getting through bankruptcy is crucial for CIT if it wishes to keep its customers, which include Dunkin' Donuts franchisees and film production company Dark Castle Entertainment.
CIT's operating subsidiaries, including CIT Bank, are not included in the bankruptcy filing, and expect to continue operating, the company said in a statement.
CIT, which filed for bankruptcy protection in the Southern District of New York, plans to reduce its total debt by about $10 billion in bankruptcy.
Under the bankruptcy plan approved by bondholders, creditors will end up owning the company. Most bondholders will also end up with new CIT debt worth about 70 percent of the face value of their old debt. Preferred shareholders, including the U.S. government, will get money only after other creditors are paid back. Current common shareholders will receive nothing.
The U.S. government invested $2.33 billion in CIT preferred shares in December 2008 through the Troubled Asset Relief Program.
CIT financed itself mainly by borrowing from bond markets, which has proven to be a flawed strategy as the credit crunch that began in 2007 has made it much more expensive for troubled companies to fund themselves.
(Reporting by Dan Wilchins; Editing Bernard Orr)