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-- private pension funds, government retirement funds and households.Commercial mortgages are also at issue and are souring. A total of $2.6 trillion "dispersed widely beyond the banking sector." And mortgages are less than half the problem. Add to them credit cards, auto and student loans, and various other kinds of private-sector debt. Consumer and corporate. Around $20 trillion in total plus nearly $15 trillion in residential and commercial mortgages.
State and local governments are at risk with $2.7 trillion in outstanding municipal securities and huge growing budget shortfalls given the current crisis.
In addition, beyond the above lowball figure, no estimates are available of derivatives default amounts or forecasts of more likely in a continuing downturn.
In sum, a monumental problem. Too big to ignore, but precisely what Congress is doing. At enormous risk to the economy, businesses, households, the American way of life, and the nation as the world's economic superpower. Plus the effect on world economies and people everywhere.
Politics, Finance and Consumer Sentiment
With the November 4 election approaching, pocket book issues show up in consumer sentiment polls and have incumbents worried. Especially Republicans seen as mostly to blame. The October 15 Reuters/Zogby Index on the mood of the country plunged from 96.3 in September to 89.7 currently. Approaching a record low 87.7 number. The poll also gave George Bush his lowest ever job approval rating at 21%. Congress scored just above its worst reading at 10%. Zogby called the results "a double-whammy" and compared the public mood to the Great Depression's early years.
An October 6 - 8 Gallup tracking poll showed much the same results. A similarly dramatic difference from the previous month:
-- in September, 38% of respondents rated current conditions poor; in October, the number jumped to 59%;
-- in September, 78% expected conditions to worsen; in October, 90% were negative.
Gallup commented that the polling data trend suggests that "consumer confidence is reaching historic lows." Further, "given the current financial crisis and associated recession, it is likely to take some dramatic efforts to turn consumer confidence around." Gallup numbers vary up and down weekly. However, given the state of things and strong likelihood they'll worsen before improving, expect the trend ahead to stay decidedly negative. Meaning bad news for incumbents being blamed.
Maybe not for the most important job according to investigative journalist Greg Palast. He uncovered convincing evidence that the 2000 and 2004 presidential elections were stolen and now has a new article titled "It's Already Stolen." It follows his joint year-long investigation with Robert F. Kennedy, Jr. revealing "a systematic program of 'GOP vote tampering' on a massive scale." They cite:
-- swing-state Colorado Republican Secretaries of State "have quietly purged one in six names from their voter rolls;" a shocking "ten times the average state's rate of removal;"
-- among newly registered voters, "more than 2.7 million have had their registrations REJECTED under new procedures signed into law by George Bush;" individuals affected are largely blacks and Latinos; likely to vote Democrat;
-- "a fired US prosecutor....accus(ed) leaders of his own party, Republicans, with criminal acts in an attempt to block legal voters...."
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