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July 14, 2008 at 11:42:20

IT'S BIGGER THAN PAULSON AND BERNANKE / IT'S A BUSH DEPRESSION

by Allen L Roland

www.opednews.com

 

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Ben Bernanke

A rare candid moment of economic despair as the reality of a Bush Depression slowly hits Treasury Sec Henry Paulson and Fed Chairman Bernanke.
Fannie Mae's and Freddie Mac's liabilities are massive and both Henry Paulson and Fed Chairman Bernanke know it ~ they can't hide the excesses of the Bush administration any longer ~ we will soon be sliding onto a major Bush Depression: Allen L Roland
Both Treasury Secretary Henry Paulson and Fed Chairman Bernanke know that the foreclosure crisis will continue deep into 2009 ~ and that Fannie Mae's and Freddie Mac's liabilities and contingent liabilities are much too large for their meager capital. It's a house of cards, built on greed, and it's about to crumble as we slide into a major Bush depression ~ which the Democrats will inherit in 2009.
My bet is that the Treasury will bail them out with taxpayer money ~ further devaluing the dollar. 
As such, ordinary American taxpayers will be made to pay for the consequences of the financial greed of fabulously wealthy financial interests. This has always been the Bush way and it will continue until either impeachment or January 20th, 2009. 
We are not talking about peanuts here ~  these two companies hold or guarantee loans valued at more than 5 trillion dollars which is roughly half of the nation's mortgages.
As usual, Martin Weiss, Money and markets, is right on top of the action and fully captures the moment.
Allen L Roland
http://blogs.salon.com/0002255/2008/07/14.html
Fannie Mae collapsing! Paulson, Bernanke in despair !
by Martin D. Weiss, Ph.D.  
http://www.moneyandmarkets.com/Issues.aspx?NewsletterEntryId=1959

Martin here with an urgent update on Fannie Mae's devastating swan dive.

Last week's plunge in the Dow ~ driven by the collapse of Fannie's and Freddie's shares ~ is just the first act of an unfolding tragedy.

Next, expect massive losses ~  and loss of confidence ~ at the world's largest financial institutions that have stuffed their portfolios with Fannie and Freddie stocks and bonds.

Is all this turmoil just malicious rumors, as Washington and Wall Street officialdom would have you believe?

I'm afraid not: Even before the latest crisis began, these two giant mortgage lenders were terribly overleveraged and effectively insolvent, according to their own murky balance sheets.

The reality: Fannie Mae's and Freddie Mac's liabilities and contingent liabilities are far, far too large for their meager capital. And this house of cards is built on the quicksand of millions of mortgages that cannot be repaid Fannie Mae has just 1.6 cents in core capital to cover each dollar of mortgage and debt exposure. Its younger and smaller sibling, Freddie Mac, has only 1.9 cents.

Treasury Secretary Paulson predicts 2.5 million home foreclosures in 2008; and Fed Chairman Bernanke has testified that the crisis will continue deep into 2009. So, in combination, these two high officials are warning of potentially millions more foreclosures in 2009.

That leaves Washington with just two choices:

  • Let them fail ... allow the U.S. housing market to freeze up ... and invite a deep depression. Or ...

  • Bail them out with taxpayer money ... double the public debt overnight ... bust the government's finances ... and gut the value of U.S. Treasury securities.
The big dilemma:

If Fannie Mae and Freddie Mac fail, international investors ~ loaded with Fannie and Freddie securities ~ will dump them in an avalanche.

But if the U.S. Treasury tries to absorb the impact of this disaster, those same investors will dump their Treasury securities in an equally large avalanche.

In EITHER scenario, foreign investors must sell their U.S. dollars. And either way, the dollar will crash, as crisis currencies ~ like the Swiss franc ~ will go through the roof.

If you're not outraged with the Bush administration ~ you're on life support.

Allen L Roland
Freelance Online columnist and psychotherapist Allen L Roland is available for commentsinterviews, speaking engagements and private consultations    ( allen@allenroland.com
Allen L Roland is a practicing psychotherapist, author and lecturer who also shares a daily political and social commentary on his weblog and website allenroland.com He also guest hosts a monthly national radio show TRUTHTALK on  www.conscioustalk.net

 

Take action -- click here to contact your local newspaper or congress people:
IF YOU'RE NOT OUTRAGED , YOU'RE ON LIFE SUPPORT

Click here to see the most recent messages sent to congressional reps and local newspapers

http://www.allenroland.com

Allen L Roland is a practicing psychotherapist, author and lecturer who also shares a daily political and social commentary on his weblog and website allenroland.com He also guest hosts a monthly national radio show TRUTHTALK on Conscious talk radio www.conscioustalk.net

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Midwesterner, veteran of VietNam era naval service, I still feel an obligation to defend the Constitution against "all enemies, foreign and domestic."
John Sanchez Jr.Midwesterner, veteran of VietNam era naval service, I still feel an obligation to defend the Constitution against "all enemies, foreign and domestic."

Here we are...

standing in the alley with our hands hoisted over our heads with the neocon jack rollers demanding our money and our life. It is that eventuality where no good options exist that makes a desperate struggle against the violators worth engaging in. There will be no more to lose.

by John Sanchez Jr. (5 articles, 0 quicklinks, 12 diaries, 1174 comments) on Tuesday, July 15, 2008 at 12:45:35 PM
 


Male, 50, Texas. White with white hair (for 20 years)
Write, read, and draw.
Topics include science, art, history, language, philisophy, the odd and unusual. SiFi/Goth/Lovecraft
Recovering from a medical episode that nearly killed me in 2006. Still being treated.
An autodidact and graduated High School but not college.
Not good with people. I have poor emotional intelligence.

nightgauntMale, 50, Texas. White with white hair (for 20 years)
Write, read, and draw.
Topics include science, art, history, language, philisophy, the odd and unusual. SiFi/Goth/Lovecraft
Recovering from a medical episode that nearly killed me in 2006. Still being treated.
An autodidact and graduated High School but not college.
Not good with people. I have poor emotional intelligence.

No more to lose? Plenty more will be lost and soon.

This is a two pronged attack on us to bring the republic down for the fascists to rebuild their way for themselves. A depression is ideal for them to finish the job of bringing down the country and putting up another alien thing in its place. One that will be a caricature of the old regime. They first tried in 1934 when there was a depression, civil unrest and a war brewing. They failed by the tiniest of mistakes. None suffered any repercussions. They have recreated the scenario for their PNAC plan. They want an empire. One without restraint of laws to protect the 'people' and separation of powers and church /state wall all broken down.

We are living on borrowed time. Our freedoms are conditional now and can be revoked at any time.

That RFID bracelet with the shock attachment will find wide use both to follow and to control people. Both gov't and corporate troops and slave laybor camps for profit.

by nightgaunt (0 articles, 0 quicklinks, 0 diaries, 186 comments) on Tuesday, July 15, 2008 at 2:19:22 PM
 

 

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