Eliminate Credit Card Debt NewsPublisher: Richard Garcia
Knowledge, Courage and Action ...We are on our own in this debt debacle!For years all of us have known that the Credit Card companies have been charging cardholder usury interest rates. Nothing knew! What is also not news is that the Media as well as the Congress have looked into this issue and it has only gotten worse. So maybe there is something else going on …like perhaps they are covering their assess and making loads of advertising dollars and campaign contributions from the industry. Oh, yea the media may say….”we wrote editorials / documentaries about it may times” and Congress held hearings and investigated this matter. Granted some Americans have seen some relief. The abuse on the part of the credit card industry is so astronomical and the response so negligible that expert are speaking of this debt issue and it’s effect on the American people in the same way that they speak of sub prime mortgage debacle, bank failures, and recently the collapse of the auto industry.
People, we are in deep, deep dodo! The Government, Media and Financial Institutions are the problem. And we need to a cert the Rule of Law and it can still be done. Knowledge, Courage and Action are required and honestly you don’t have any other choices or course to follow.
If these words resonate in you, it would be in your best interest to contact StopDedtUSA!
Case in point
Congress Takes Aim At Credit Card Policies and
CBS News – Video
[READ MORE] [COMMENT]Statement From G-20 Summit: In English
Statement From G-20 Summit: In English
Catherine and News & Commentary,November 19, 2008 at 11:11 am
The Editor of Expresso in Portugal wanted my take on the recent G-20 communique. Here is my “translation” of the official statement:
1. Now that the growth of debt and derivatives bubbles has stalled, we are committed to using governmental-central bank mechanisms to cover the positions of any of the large private financial institutions whose profits are at risk due to their management of these bubbles and who can use this opportunity to squeeze and acquire smaller rivals at low cost.
2. Our commitment to use derivatives and market interventions to shift investment from the real economy and commodities into a paper economy is firm. We will continue to use centralized governmental mechanisms to subsidize and manage this process.
3. All of the organizations and players who reaped a fortune engineering the debt and derivatives bubbles will be allowed to keep their winnings.
4. We will use this period of consolidation to further centralize the global financial system by enforcing greater centralization of the standards, practices and control of enforcement and regulatory bureaucracies. This increased governmental centralization will be presented as the “fix” for our “problems.”
5. We will continue the move toward one world government and one world currency.
6. We are prepared to use coordinated inflation of global money supplies and fiscal stimulus to protect our control and positions.
7. We are committed to the Slow Burn (see my blog post on this subject).
8. This process will continue to be managed to protect large insurance and risk positions.
9. The net result will be to continue to exercise growing control over the real economy by a handful of private families and institutions designed to protect and grow intergenerational wealth.
G-20 are silent on the military and covert action that will be required to make this stick. They are also silent on how they are going to manage this much inflation. For example, the most recent figures from the St. Louis Fed indicate that the aggregate monetary base is growing at an annualized rate of almost 800%.
Watch for a new focus on “green investing” as the trick in all of this will be how to create new productivity when the absence of real prices mean there is no market to provide the necessary signals and financial incentives.
Visit
http://solari.com/ for a wealth in information
Catherine Austin Fitts offers Solari clients a unique perspective on how to navigate the opportunities and risks in the global financial system and political economy. Her background includes:
Investment Advisor: Founder and managing member of
Solari Investment Advisory Services, LLC.
Entrepreneur: President of The Hamilton Securities Group, investment bank and financial software developer.
Government Official: Assistant Secretary of Housing - Federal Housing Commissioner, Bush I.
Investment Banker: Managing Director and member of the board of Wall Street firm Dillon Read & Co. Inc.
Catherine has designed and closed over $25 billion of transactions and investments to-date and has led portfolio strategy for $300 billion of financial assets and liabilities.
Catherine's experiences on Wall Street and in Washington D.C. are chronicled in
Dillon Read and the Aristocracy of Stock Profits: .
[READ MORE] [COMMENT]National Debt Freedom DayAmerican Debt Enders Declares National Debt Freedom Day
By American Debt Enders
Dated: Nov 19, 2008
With credit card debt being a national epidemic in the United States, American Debt Enders is declaring that January 20th, 2009 be the first National Debt Freedom Day.
Millions of Americans have lost their way financially. Couple this with the fact that the credit card industry has been allowed to continue its usurious practices of extreme interest rates and onerous nuisance fees while our elected leaders "Fiddle while Rome burns", and it should be of no surprise to anyone that we are in the economic mess we are in.
We have national smoke out day, so why not National Debt Freedom Day. To many Americans have allowed themselves to become debt slaves to the credit card industry. Yes, we must take our share of personal responsibility for allowing this to happen. So, just like anyone suffering from any addiction, we must admit we have a problem and vow to take whatever necessary action to get to a solution.
How will the day be celebrated? On January 20th, 2009, and each year following, let all of us avoid using a credit card for 24 hours. Debit cards are acceptable. The idea is to one: Get us reacquainted with the idea of paying for something at the point of transaction, and not having a credit card company front the money for us. Second, think of the message. We will take back financial control of our own lives, and are stating we are tired of being victims of the banking industry with their 30% interest rates, and pay for life programs. Tell me what investor makes a steady 30% return. Third: We will no longer be victims, but take full responsibility for what has occurred, change our ways, and move on.
As is the case with the National Smoke Out Day, it is our hope that some people will go on to relearn what it was like before they became addicted to credit cards. That feeling of having something paid for. As with any other addiction, we can only empower ourselves to become debt free. Realization that we have a problem is always the first step. Debt Freedom day is designed to help us achieve that realization.
The only way to regain control of your money is to break the credit card habit. You can break the habit if you control your money. You can control your money by learning to budget and track your expenses and income. To do this you need a budget. If you need help learning to budget visit: http://www.americandebtenders.com/budgeting.html , and use the free tools.
We need to end debt slavery, one person at a time. Most of our national leaders do not have a clue. Please, feel free to send this article to everyone and anyone. You may reprint it in its entirety, provided you keep the signature line and permission line in tact.
Most importantly, participate in National Debt Freedom Day.
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For Profit debt counseling referral service offering debt management, debt settlement, credit restoration and helping to educate the debt ridden consumer through our Free Newsletter.
Category Event, Consumer, Finance
Tags Debt Freedom, Avoid Bankruptcy, Debt Settlement, Debt Management, Make A Budget, Free Credit
[READ MORE] [COMMENT]To Bailout Or Not To Bailout..Is that the Question?Well well well.....
Nov. 17 (Bloomberg) -- The Bush administration will not seek the $350 billion remaining as part of the $700 billion financial-rescue package, leaving it to the next administration to request the funds, a person familiar with the matter said.
With weeks remaining in the Bush term, the Treasury Department will defer to President-elect Barack Obama to request the funds after he takes office on Jan. 20, the person said.
I guess getting caught lying (twice - see the previous Ticker) would raise the risk (quite a bit!) that Congress would say "stuff it!" to any "request" for the rest of that money, eh?
Funny, that.
Or was it the G20? Maybe someone stuck a birdie in Bush's ear and told him that the rest of the world wasn't going to keep buying our Treasuries if they didn't cut that crap out? Inquiring minds want to know what was said behind those closed doors!
Further, there's no reason to use the rest of the money anyway. The first part was a giveaway that should lead to (but probably won't) indictments, and there is simply no argument for spending the rest on this abortion of a bill at all.
I can think of a number of good places to spend that $350 billion, including holding it in reserve for the inevitable need to feed, shelter and clothe millions of Americans who are going to be homeless and hungry during The Depression that Paulson, Bush and Bernanke's actions over the last 18 months have essentially guaranteed!
I go back to what Obama should make the centerpieces of his policy on the economy:
1. No more lying. No more off-balance-sheet anything. No more Level 3. No more shifting your losses onto the back of working Americans. You screwed up, you eat it. You try to do otherwise, you go to jail.
2. America needs to adjust down its economic expectations to what we can afford to actually pay for from present earnings, both at a personal and government level. "If you don't have the money, you can't afford it." Period.
3. Those who committed fraud need to go to jail. No matter who they are. End of discussion.
4. No bailouts. Period. Unsupportable debt must be defaulted. Do it, get it out in the open, and get it over with. Yes, its going to suck, but its going to suck no matter what we do. We can either have it suck hard and short, or far worse and far longer. The more we screw around with this the worse it is going to be.
5. We need to have a very serious discussion about health care and how we're going to ration (yes, we must) it when the bill is paid by society. Nobody wants to talk about this but we have to. It is unavoidable. There is not an unlimited amount of money available. Yes, this means that at some point society has to cut off the money, and no, your Medicare tax is not a license to spend unlimited amounts of someone else's money as you age - whether you'd like it to be that way or not.
We cannot afford to have a Treasury Market dislocation, and to avoid it we are going to have to demonstrate by clear example and policy that we will not try to issue trillions of debt in order to try to bail out speculators who made bad bets - both domestic and foreign, nor are we going to promise that which cannot be delivered. We also cannot bail out other nations who made bad bets (and investors in them) and we must make clear that this is not on our agenda now - and won't be in the future.
Oh, and by the way, let's add something else for Mr. Obama:
Do not even consider what is being floated in this article:
"TOKYO - Japanese economists, increasingly concerned that the United States might seek to pay its enormous and growing debt obligations in a weakened US dollar, are looking to the possibility of US Treasuries being issued in yen."
No no no NO NO NO NO NO!
This - sovereign debt denominated in other than your native currency - is how a nation winds up like Weimar Germany - or Argentina! We must not issue bonds denominated in foreign currency - period.
If foreigners do not want to buy our debt then we must cut back our government spending until they are willing to do so. But we must not, under any circumstances, issue Treasuries denominated in the currency of another nation. Down that road lies the ruin of our nation and monetary system - with certainty.
Now let's talk about the auto industry.
There is no fix for these firms in their present form.
Period.
We have been operating at a "run rate" for automobile sales of about 17 million units a year. The "no silly credit" number is closer to 11 million units.
Notice how you don't see the number of "older, junky" cars on the road you used to? That's the "chicken in every pot" that was silly-credit created.
The UAW has said they will not make any (more) concessions. Yet they have to make concessions, simply put, because the industry needs to shrink by 40% to be viable.
There is only one way out of this - Chapter 11. We must force these firms to downsize to that which can be sustained.
Period.
Yes, this will cost jobs.
It is going to cost jobs no matter what we do, because we have built an entire industry up around a totally unsustainable demand curve and that which cannot be sustained will not be sustained.
If we try to "bail them out" we are simply throwing money down a rathole. GM has a negative $60 billion net value right now. Toss 25 billion in, they still have a negative net value.
GM has been functionally bankrupt for more than a decade; this is not a new problem and both management and labor have refused to solve it for more than 10 years. There is absolutely no reason to believe they will solve it absent force, and the best "force" out there is the transparency that is forced upon a firm via the bankruptcy process.
Chapter 11 allows these firms to submit their labor agreements to the court to have them forcibly renegotiated (without favor to either side) and in addition it forces the pension problem into the PBGC where that is reduced as well.
I know the UAW doesn't like this but that's just too bad. There are only five gallons of water in a five gallon jug, no matter how much you'd like there to be eight. The demand at former levels will not return because it is dependent on a Ponzi Finance scheme where consumers roll over old balances into new loans, putting themselves instantly underwater by $5,000 or more before they even get in the driver's seat, and then they take a second $5,000 hit when they drive off the lot. That scheme has run to conclusion and cannot be pushed any further.
Second, we need to allow the diesels sold in Europe into the US. They can't be sold here due to the Greenie BS. That's stupid; hang the greenies up by their toenails. While we're at it, if the crash standards are good enough for Europe, they're good enough for the US. Now we can have small cars that get 60mpg with those diesel engines; a huge part of why we can't get there from here now is the crash standards in the US that prohibit the sale of vehicles available across the Atlantic. Why can't we build those here? Emissions and crash standards - period. We detune engines and then on top of it mandate hundreds of pounds of extra weight that make impossible the sort of fuel economy that is routinely achieved on European roads.
Its time to cut the crap and throw the Greenies and Weenies in the Love Canal.
Third, there are other automakers in the United States that do not need bailouts - several of them. Toyota, BMW and others have plants in this country that are building cars, and they'd doing ok. Yeah, their profits are down, but they're making money - and cars - with American workers.
If the UAW, GM, Ford and Chrysler can't compete with these other firms on our own soil in a down economy that's just too damn bad - its time for us to drive American-built Toyotas and tell GM management and the UAW to stick it in their ear!
'Nuff said.
Douglas Middleton
[READ MORE] [COMMENT]Yes We Will (Have A Depression)The mainstream media is finally starting to figure it out.
In Barron’s "Other Voices" column for publication on Monday we have this:
NOW WE CAN SEE THAT THE ECONOMY IS A CONFIDENCE GAME. With markets spinning out of control and liquidity frozen, analysts and commentators repeat again and again that the problem is that investors have lost confidence. What they don't adequately stress is that this loss of confidence is fully justified.
In the past several decades, financial markets have become a sophisticated confidence game, and the people in the markets are latter-day versions of Herman Melville's wily character in The Confidence-Man, duping passengers floating down the nation's great artery, the Mississippi River, on the paddle-steamer Fidèle. (Melville's novel, appropriately, takes place on April Fool's Day.)
.....
The world Melville imagined more than 150 years ago has become a reality today. In the microcosm of the Fidèle, devious con men prey on credulous victims, who no longer know what is real and what is not.
Although the disguises have changed, the game has not. When values-financial, moral and religious-are based on nothing, redemption is impossible. We will not solve our economic problems until we unmask the disingenuous tricksters and reassess values that are not merely financial."
Bloomberg Media is also on the case now with a lawsuit aimed at The Fed:
``The American taxpayer is entitled to know the risks, costs and methodology associated with the unprecedented government bailout of the U.S. financial industry,'' said Matthew Winkler, the editor-in-chief of Bloomberg News, a unit of New York-based Bloomberg LP, in an e-mail.
The Fed has lent $1.5 trillion to banks, including Citigroup Inc. and Goldman Sachs Group Inc., through programs such as its discount window, the Primary Dealer Credit Facility and the Term Securities Lending Facility. Collateral is an asset pledged to a lender in the event that a loan payment isn't made. "
It only took nearly a year and a half from when I started to sound the alarm before the evidence became incontrovertible and the media began to wake up: over a million jobs were lost, the market is down 40% (with a target of down 90% - halfway there on the road to hell!) and unemployment is in the process of skyrocketing.
But the voices calling for "more hiding of the truth!" have not ceased; indeed, the stridency of their screaming has gone parabolic. Chief among them are one of the architects of the lies in the first place, the National Association of Realtors (NAR)'s Lawrence Yun:
Given the sentiment in Washington, and also with a new president coming in, President Obama -- and he has indicated that he is favoring some sort of economic stimulus -- we believe that the stimulus package should be focused on housing because we cannot have solid, sound economic recovery without housing market recovery," Yun said."
Yun then goes on to list yet more ways to lie about value, including interest rate "buy downs" (which in fact just take the money out of your pocket as a taxpayer to pay what comes out of your pocket as a home buyer - and does nothing), making increased "conforming" price limits permanent (again - transferring risk from you to you) and similar nonsense.
Oh, and they're forecasting that home prices will increase in 2009 and 2010.
This is, of course, the same group that had its former economist publish a book which had as its subtitle "Why the housing boom will not bust."
Put NAR firmly in the camp of those who refuse to acknowledge economic facts due to their own twisted self-interest.
Nor shall we exclude Berkshire Hathaway, which reported huge losses - more than a billion - on marks taken against derivatives that Warren called "financial weapons of mass destruction" - just before he wrote some.
Oh, and this is one of Obama's chief economic advisers. You'd think that the man who ran on "Change" would, in fact, be interested in seeing some. Perhaps it was just a slogan.
Put The Federal Reserve in the camp of liars and cheats.
"Previously, the rate on required reserve balances had been set at the average target federal funds rate established by the Federal Open Market Committee (FOMC) over a reserves maintenance period minus 10 basis points. The rate on excess balances had been set as the lowest federal funds rate target in effect during a reserve maintenance period minus 35 basis points. Under the new formulas, the rate on required reserve balances will be set equal to the average target federal funds rate over the reserve maintenance period. The rate on excess balances will be set equal to the lowest FOMC target rate in effect during the reserve maintenance period. These changes will become effective for the maintenance periods beginning Thursday, November 6."
Let's talk about this a second. The EFF, or effective Fed Funds Rate, has traded at 0.23% on average since shortly after the target was lowered to 1%. This is a spread of 75 basis points, roughly.
The "discount" on deposited reserves was 35 basis points.
Therefore, were I a bank I could borrow as much as I wanted at 25 basis points and deposit it as "excess reserves" at The Fed (instead of lending against it) and earn an absolutely risk-free return of 40 basis points.
Who pays the 40 basis points? You, the taxpayer.
What is the change they proposed likely to actually do? Increase the EFF? Probably not. More likely it will increase the amount you, the taxpayer, pay banks to 75 basis points.
This is called a "liquidity trap" and is one of the problems with allowing The Fed to pay interest on reserves - they have a direct line to the Treasury for that money, which of course means that you, the taxpayer, are the one who ends up paying.
Did Congress object to funneling off yet more of your money to the banks where they could (and are) stashing those funds with The Fed instead of lending them out? Oh, Chris Dodd and Barney Frank have made much noise about the Tarp, but have either of them made noise about rescinding the ability of The Fed to pay interest on reserves?
Nope, because, in all probability, they don't understand it - and if they do, they sure as hell are counting on you not understanding how all this works.
Never mind that The Fed has found itself powerless to impact the real economy. Remember that Ben Bernanke, back in September of last year, said that he was lowering interest rates and that monetary policy had a "transmission delay" of six to twelve months.
Well Ben? We're six to twelve months later, and instead of easing the upcoming storm what we've seen is the collapse of two major investment banks, the near-collapse of the largest insurer in the world, and the near-collapse of the two largest mortgage issuers and guarantors.
Never mind General Motors, which now has a negative $60 billion book value.
Behind all of this destruction is the ugly truth expressed in the top article I referenced here - that we have gone from an economy that produces cars, grain and TVs to one that shuffles paper.
The first produces real wealth and allocates some of it to the producers up and down the line.
The second invents wealth that does not exist, and relies on people believing the lies in order to succeed - at least for a little while.
We did the same thing in the 1920s, and we got the consequences in the 1930s.
Now we've done this in the 1990s and 2000s, refusing to take our medicine in the 00-03 timeframe, and since we did it "at least twice as bad" this time around, we should expect that it could easily be worse than the 1930s in response.
Sure, we have people who "get it" more than they did in the 1930s. But what we don't have is leaders, either in The Fed or Government, that are willing to do anything about disclosing the truth - which is that they've been complicit in this entire mess (just as they were in the 1920s) and thus they need to fall on their swords.
The greatest area of danger here is that The Fed is in fact trying to catch not a falling knife but rather a falling piano. The idea that The Fed can prevent a debt deflation of this magnitude is pure folly; even with expanding its balance sheet from $800 billion to over $2 trillion in less than a year and increasing its leverage to 50:1 (as of the most recent Fed report) it pales beside a housing market that has roughly $3 trillion of bad debt to be expunged - and that's just one sector of damage.
Taken in total the debt that must be defaulted in order to restore balance is likely in the $8-10 trillion range in the United States, and The Fed is not limiting its influence-peddling to the US. The swap lines it has opened to places like South Korea are an attempt to prevent debt deflation there from reflecting back into trade and global currencies; when one looks at the global deflationary forces at play one is staggered - they may in fact exceed global GDP (~$50 trillion)
As just one small example of this we have AIG, which Friday "announced" that it is "annoyed" that banks got better terms than it did in the TARP and thus they now want to "renegotiate", desiring to "pledge their MBS" to restructure the loan and/or do a "debt to equity swap" (akin to my "cramdown" in The Genesis Plan.)
Someone's been smoking some damn good stuff over there at AIG.
You see, AIG already pledged all its assets to The Fed to secure the original line of credit. And what did they pledge to get the second line of credit? Who the hell knows - how do you pledge more as collateral than what you have? One must assume that second credit line is in fact unsecured!
This bit of game playing raises all sorts of questions for The Fed and our government, none of which are being asked or answered as of yet, such as:
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We still don't know what happened to the mysterious NY Fed credit line that went out to Lehman Brothers to settle certain obligations at or about the time they went under. As far as I can tell, it has not been repaid. Where's the money, who got it, and what security is being held against it (if any)?
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If AIG pledged "all its assets" on the original $80 billion, what did they pledge for their second line of credit? How do you pledge more than you have? And how do you cram down something that is already pledged off as security when you want to "restructure" your deal?
This is kind of like a poker player who goes bust in the casino and troops to the cage to demand another marker; when told that his check is no good he threatens to commit suicide right there and make a hell of a mess that will drive away business unless they give him cash for his worthless paper.
Or we could take GM's case (mentioned above); they are threatening to open up with a Tommy gun on the casino patrons before turning the weapon on themselves (in the form of a threatened 2 million jobs to be lost) if they aren't given a gift - it sure as hell isn't a loan if you have negative net worth!
Care to bet on how many other "suicide threats" The Fed and Congress have had presented to them over the last year but we have not been told about (or at least, not with any sort of real disclosure!)
The precipice America stands on is narrowing dramatically and our government and The Fed are chipping away at the rock with jackhammers.
The Fed is essentially kiting and praying that the clock doesn't run out on them - or worse, that someone doesn't hold up the funds "somewhere" long enough to disrupt the chain. In a "kiting" scheme the crook deposits a check into Bank #1 from Bank #2 (which is in fact no good!), then draws the funds on Bank #1 and deposits them in Bank #2 to make the check good that they wrote. This is illegal, by the way, if you're an "ordinary Joe", as you are effectively counterfeiting the money (it doesn't exist in both places at once!) during the time of the float.
But wait! Isn't counterfeiting of credit the entire nexus of the last five years of "financial innovation"?
Yep.
And now we have The Fed continuing the game but on a global grand scale, taking the excess leverage that everyone else had and consolidating it on its own balance sheet. Where we had a few investment banks running at 30:1 leverage, we now have our Fed running at fifty to one!
The Fed is running what amounts to a gigantic kiting scheme where it borrows $500 billion (the "supplemental Treasury program") from various foreign and domestic sources then loans that money out to the same domestic and foreign sources who settle those trades!
As further evidence of this game we have an enormous number of "fails to deliver" in Treasuries. Why would there be a fail to deliver unless the person who sold it doesn't have it? That's the essence of a kiting scheme - you're effectively counterfeiting, because you're writing a draft that you can't settle. This is showing up in the Treasury market, where "fails" reached an aggregate five trillion dollars in October.
If you or I pulled this game we'd be under indictment. Yet this is the essence of the various programs that Treasury and The Fed has put into place - primary dealers take down Treasury supply yet they are, in no small part, recipients of these various alphabet soup financing programs.
That is the definition of kiting folks. Go look it up.
Why doesn't Congress - or our President-Elect Obama - get out in front of this and stop it?
For one, 99.9% of Americans don't understand it. Many people "kite" checks unknowingly, or at least did before the advent of near-instantaneous electronic clearing. How many people used to go to the grocery store on Thursday night knowing they would be paid Friday, and write a check for groceries that they knew was no good until Friday morning?
Lots. In fact, most people don't even understand that this is against the law because it is in fact counterfeiting the credit (money) that you are allegedly paying the store with.
The Fed (from its balance sheet) can be demonstrated to have about $1 trillion out in loans. Bank lending is actually way up - it is not collapsing.
So where did the loans go?
To other banks and "shadow" financial entities (hedge funds, etc), back and forth, kiting the money while chewing off little bits here and there for their own salvation such as the excess reserve interest payments, all of which is being charged back to you, the taxpayer.
Paulson's TARP (in its various forms, including its original design) makes it worse; in addition to kiting funds back and forth the TARP makes possible the exchange of Treasuries (money good) for trash (MBS and other "assets" that are worth fractions of a dollar.) Bluntly, what Paulson is doing is taking your money and giving it to the banks at a discount (based on whatever they tender to him) who then loan it to you at interest.
Perhaps Obama (or Paulson) can explain exactly how is it beneficial to the economy to:
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Take capital (your tax receipts) from you and instantly devalue it by whatever the real value of those MBS and other "assets" are.
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Exacerbate this drain on the real economy and consumer (you) by then loaning that money back to you at interest.
I see only damage there to the real economy and to taxpayers, not benefit.
This mistake is the root of all of the so-called "liquidity facilities" proposed thus far, and it is precisely the same set of mistakes made during 1929-31 that led to what was destined to be an ordinary (if deep) recession turning into The Great Depression.
Nor does it stop there. Obama declared that his first priority was a "second stimulus."
The problem with such a "stimulus" is that it can't and won't work, and public support for same relies on the ignorance of the body politic. As I demonstrated the last time the first "stimulus" cost you more in the first year if you were a home buyer than you got in the check; that is, it had a negative real value to you, and worse, it continued to accrue that negative value through the next 30 years!
This is what must happen because our government does not have a surplus from previous "good years" banked in the Treasury; if we had we could use it to cushion the blow. But since our government has never managed to accumulate such a surplus any such "stimulus" is in fact coming out of your pocket in the form of additional debt upon yourself in order to pay yourself.
It is exactly identical to you having $20,000 worth of credit card debt, "rolling it over" into a new credit card and then charging up the now-cleared credit line. You have not improved your financial situation one iota but rather have made things much worse!
Yet this is what President-Elect Obama and the Democratic party have proposed.
We're headed for another Depression folks and I no longer consider the actions that are being taken by our government to be "mistakes" - at this point they must be classified as knowing and intentional acts, depending on you, the public, being too ignorant of how banking and finance work to figure it out and demand that they stop it.
"Stop it" means what I've said all along - force the bad debt out into the open where it must be recognized and defaulted, no matter who it screws, then pick up the necessary pieces. This will result in a lot of bankruptcies but it will also realign debt payment capacity with debt outstanding, which is the critical element that must and will come back into balance.
We can do this via the marketplace or we can continue to increase the imbalances and guarantee a far worse outcome; it is only through government endorsement of a refusal to recognize insolvency that recessions are turned into Depressions, and right now we're getting it in spades.
If you're wondering how bad it can get, and how fast, read this:
"Overnight, people lost their savings. Prices are soaring. Once-crowded restaurants are almost empty. Banks are rationing foreign currency, and companies are finding it dauntingly difficult to do business abroad. Inflation is at 16 percent and rising. People have stopped traveling overseas. The local currency, the krona, was 65 to the dollar a year ago; now it is 130. Companies are slashing salaries, reducing workers’ hours and, in some instances, embarking on mass layoffs. (Iceland in October of this year)
“No country has ever crashed as quickly and as badly in peacetime,” said Jon Danielsson, an economist with the London School of Economics. "
To "borrow" (sorry, no interest either Barack) a couple of our new President's slogans:
Yes we can - have a Depression.
Yes we will - have a Depression, unless our "leaders" stop it, and President Obama and The Democrats will own it, being the party with complete control of Congress and the White House.
Our government is counting on you remaining ignorant.
Will you meet their expectations?
PS: Watch Ireland. Closely.
Douglas Middleton
[READ MORE] [COMMENT]America spoke, and said not just "no", but "hell no."It's over.
John McCain went down to defeat today in what was an obvious, predictable loss.
Claiming to be a "maverick" while in reality being anything but, Senator McCain came across instead as alternatively a petulant child and an apologist for bankers that have robbed America blind for the previous six years. As one of the "Aye" voters both for the $700 billion robbery of taxpayer bill (an affront that Barack Obama shares) and the "bankruptcy reform" bill that put a noose around American's necks, he finally "got his" on the national political stage.
America spoke, and said not just "no", but "hell no."
Unlike when we spoke to you Senator McCain when you were voting for the bailout, this time you're obligated to listen.
Unfortunately the McCain campaign turned out to be nothing more than apologists for the liars, cheats and frauds.
I called this back in July, and there are times I hate being right.
This is one of them.
In reality there is nothing to like here in this election season. America's economy is headed for the hole in the center of the bowl no matter what we do, and the imperative now must be to guarantee that the bankers and fraudsters don't make off with any more of our money, to claw back what we can, and to protect the funding capacity of our government, not to protect bankers and attempt to do what is mathematically impossible.
I have only faint hope that President-elect Obama will accomplish any of that in his time as President, and even less faith that he will be able to interdict the present idiocy prior to his inauguration.
It takes a strong man to stand up to the banking interests that bribe everyone up and down Washington DC. President Obama is only 10% likely to do the right thing, a President McCain was 0% likely to do so.
I do see, however, two possibilities and no middle ground, which gives me some hope. One possibility is that President Obama will proceed to play "pigman handout-a-thon", in which case our nation is headed for an economic collapse that will make The Depression look like a cakewalk.
Should President Obama listen to such idiots as Ben Bernanke and Henry Paulson, this outcome is assured. Two years from now the Democratic Party will suffer the worst defeat in the history of the Republic, being mortally wounded and forever removed from American Politics. Four years from now President Obama will depart with his tail between his legs and head home to Chicago with a new middle name - "Hoover".
The depths to which American could sink under such a series of mistakes cannot be underestimated. It is entirely possible that a worst-case scenario could come to pass, including a political failure in our nation.
Barack Obama understands what this could mean, since he has ancestors who dealt with not being free men - and one hopes he is conscious of the risk that continuing down the "bailout path" brings in this regard. This risk cannot be overstated; it is REAL. Political and monetary failure, if it occurs, has an extremely high risk of leading to a form of government that is very different than our founding fathers intended, and none of us want to see.
The second possibility is that President Obama actually thinks on his own and comes to recognize that he's not a figurehead, nor is he a puppet of the bankers and fraudsters - that he was sent to Washington DC for a reason.
To imprison all the fraudsters both on Wall Street and Main Street, and recover every nickel possible from their ill-gotten gains for ordinary Americans.
To clean up American Finance and implement The Genesis Plan or something akin to it, forcing full transparency and limits on leverage throughout the financial system.
To tell The American People that no, you cannot have houses appreciate faster than incomes, that the maximum sustainable home price is 3.5x income, and that spending more than 36% of your pretax income on all your debt, housing included, is both unreasonable and unsafe, leaving you one minor household disaster away from bankruptcy.
This pronouncement, along with policies that encourage same, will lead to a rapid revaluation of home prices downward, and clear the market.
To tell The American People that "free trade" sounds fine in theory, but that as practiced over the last 20 years it has led to tremendous distortions in foreign exchange and interest rates, not to mention millions of Americans losing their jobs to overseas workers who aren't better at what they do - they are just cheaper, mostly because they are either coming from or still living in slave-like conditions. Perhaps President Obama will do something to correct that imbalance, although you can bet the "masters of American Capitalism" will scream loud and long about any such attempt.
To tell The American People that the age of bubblenomics is over - that one must earn enough money to buy what one wishes to purchase, and if you can't, then you're unable to afford it - and that this applies to government as well.
To tell The American People that an Obama Administation will not permit The Fed to print money, nor to monetize bad assets - whether they be fraudulent mortgages, bad credit card debt, upside down auto loans or anything else. That such bad debt must instead be forced to default, and those who wrote that paper must eat their loss, no matter how painful and whether or not it results in business failure.
Tough but necessary words - words that are exactly opposite that which President Bush uttered after 9/11.
This is the change that America voted for Senator, now President-Elect Obama.
Is this the change that we truly can believe in, or were those mere words in a Presidential campaign?
We shall soon find out.
Douglas Middleton
[READ MORE] [COMMENT]Get Out of Debt (Slavery)Part 2
To re-enforce this point I will remind you of the.
Dave Ramsey Story. Please read it because I will be drawing from it.
“I was really having fun. But 98 percent truth is a lie and that other 2 percent can cause big problems,… I had a lot of debt – a lot of short term debt – and I’m the idiot who signed up for the trip.” This is the kind of ruthlessness that is required to make lasting changes in your life and this is especially true regarding your financial future.
“We soon learned that we were not the only ones at the bottom. Barbie and Ken (you know, the couple who appear to be perfect – perfect clothes, perfect car, perfect house) are broke,… So, don’t be so judgmental about you situation, it only slows your progress. We are all in deep shit or haven’t you noticed.
Your family’s journey toward debt relief with the goal of financial freedom is a path with many rewards. As you take inventory of all that you have, as well as that, which has you, the wisdom of your own internal voice will open to new possibilities. The most creative people on the plant are artist but the great ones are the one that work towards finding their own voice by overcoming the brain washing of what is perceived as a right or a wrong way of life.
If I have not made it clear enough DEBT EQUALS SALVERY.
As true as that maybe, so is…… Slavery is a State of Mind!
[READ MORE] [COMMENT]GET OUT OFF DEBT NOW!Part 1
You are up to your eyeballs in debt. You could cut the tension and anger between you and your spouse with a knife. You both work you’re butts off only to receive a paycheck that is never enough to even make a dent on your debt. Maybe you are already facing medical issues; after all, between the quality of food, air, water, the medicine with accompanied side effects and the stress of sleepless nights, it’s no surprise! Well you get the picture…. you’re living it!
Debt relief is just one of many ideas that come to mind since we are talking about debt.
What will we be talking about?
· Debt Management Counseling
· Debt Consolidation
· Debt Settlement
· Bankruptcy
· Debt Elimination
Well it is debt elimination, but we are not talking about some service provided for a fee…
You probably couldn’t afford one anyway and if you could it would only temporarily help. You need to kick off the debt monkey, the addictions and the way of life that got you into this fix. BUT it is not all your fault, as there have been some powerful forces that have worked against your best interest.
Let’s get STARTED!
I ask you, from the start to be as honest as you possibly can be with yourself, to work at being truthful with each other and to allow the truth you see round you to grow and lastly and most important, let your creative minds blossom.
First, you have to admit is that you are a financial failure. When you look around it might not look that way. But if it does look like failure it is going to be easier for you than it would be for those that have surrounded themselves with THINGS.
Second, you must be willing and ready to get rid of it all. Cut all you’re attachments to things and attach yourself to those you love. It is for them and yourself that you must practice tough love …getting back to basics is what this is all about.
We can’t under emphasis the power of working together towards debt relief. In other words it is the power of Love for each other. After all, whether you are dad, mom, sons or daughter or house pets you are all in this together and share some responsibility. It is counter productive to point the finger at one another.
[READ MORE] [COMMENT]Cancel Your Credit Card before you DIE!Now some people are really stupid!!!! Be sure and cancel your credit cards before you die.
This is so priceless, and so, so easy to see happening, customer service being what it is today.
A lady died this past January, and Citibank billed her for February and March for their annual service charges on her credit card, and added late fees and interest on the monthly charge. The balance had been $0.00 when she died, but now somewhere around $60.00. A family member placed a call to Citibank.
Here is the exchange :
Family Member: 'I am calling to tell you she died back in January.'
Citibank: 'The account was never closed and the late fees and charges still apply.'
Family Member : 'Maybe, you should turn it over to collections.'
Citibank: 'Since it is two months past due, it already has been.'
Family Member: So, what will they do when they find out she is dead?'
Citibank: 'Either report her account to frauds division or report her to the credit bureau, maybe both!'
Family Member: 'Do you think God will be mad at her?'
Citibank:'Excuse me?'
Family Member :'Did you just get what I was telling you - the part about her being dead?'
Citibank: 'Sir, you'll have to speak to my supervisor.'
Supervisor gets on the phone:
Family Member : 'I'm calling to tell you, she died back in January with a $0 balance.'
Citibank : 'The account was never closed and late fees and charges still apply.'
Family Member : 'You mean you want to collect from her estate?'
Citibank: (Stammer) 'Are you her lawyer?'
Family Member :'No, I'm her great nephew.' (Lawyer info was given)
Citibank: 'Could you fax us a certificate of death?'
Family Member: 'Sure.' (Fax number was given) After they get the fax:
Citibank: 'Our system just isn't setup for death. I don't know what more I can do to help.'
Family Member: 'Well, if you figure it out, great! If not, you could just keep billing her. She won't care.'
Citibank: 'Well, the late fees and charges do still apply.' (What is wrong with these people?!?)
Family Member: 'Would you like her new billing address?'
Citibank: 'That might help...'
Family Member: ' Odessa Memorial Cemetery, Highway 129, Plot Number 69.'
Citibank: 'Sir, that's a cemetery !'
Family Member : 'And what do you do with dead people on your planet???
[READ MORE] [COMMENT]Do You Need Relief From Unsecured Debt ..Like Credit Card Debt Or More?Here also are a couple of radio broadcasts of our debt relief process
Click Here For Unsecured Debt Relief Solution
Click Here For Unsecured Debt Relief Solution
Click Here for More Info On Unsecured Debt Relief[READ MORE] [COMMENT]
