Stock Market Crash Expected In 2008 To Be Worse Than 1929

[Soldier4Christ]

This fits right in with the Jerome Corsi "Red Alert" article on "The coming 1-world currency"

http://forums.christiansunite.com/index.php?topic=22303.msg257480#msg257480

Central banks may expand range of collateral: Nikkei

Central banks in the United States, Europe and Japan will consider taking foreign-denominated assets as collateral in an effort to provide liquidity for battered financial markets, the Nikkei newspaper said on Sunday.

Currently most central banks only accept assets denominated in their home currency as collateral, the paper said. If central banks were to accept assets denominated in other currencies, cash-strapped firms would be able to get funds easier, it said.

Six central banks, including the U.S. Federal Reserve, the Bank of Japan, the European Central Bank, and the Bank of England are discussing a potential rule change, the Nikkei said.

The paper did not quote any sources and no one was immediately available at the Bank of Japan for comment, however BOJ Governor Masaaki Shirakawa said earlier this week the move was under consideration.

"Regarding cross-border collateral, as I have said before in a number of speeches, it is an issue being considered among central banks and the BOJ is also part of this and is considering it," Shirakawa told a news conference on Wednesday.

In Japan, foreign financial companies have been unable to fully access the offered liquidity because their yen-denominated assets are limited, Nikkei said.

Overseas investors, including hedge funds, hold only 7 percent of outstanding Japanese government bonds, it said.

Some central banks, including the Bank of England, do accept some foreign-denominated assets as collateral, but the discussions are aimed at widening that, the paper said.

The world's top central banks joined forces on Thursday to throw a multibillion-dollar lifeline to global markets in a push to free up bank-to-bank lending frozen by upheavals on Wall Street.

[Soldier4Christ]

Jimmy Carter started the rot that led to the present financial crisis

A Stop The ACLU article:

Much as Bush-hating media members conveniently ignore historical events that led to the invasion of Iraq in March 2003, their current finger-pointing at the White House, John McCain, and all Republican politicians for the collapse of the financial services industry lacks any honest assessment of decades-old legislation that laid the groundwork for today’s problems. In particular, 1977’s Community Reinvestment Act which required banks and savings institutions to make loans to the lower-income areas in the communities they served.

Despite how integrally tied the current crisis is to this bill enacted by a Democrat-controlled Congress and signed into law by Jimmy Carter, no major media outlet other than Investor’s Business Daily and National Review Online mentioned it during last week’s market meltdown. Going against the grain was a highly-informative editorial by IBD Thursday:

    To hear today’s Democrats, you’d think all this started in the last couple years. But the crisis began much earlier. The Carter-era Community Reinvestment Act forced banks to lend to uncreditworthy borrowers, mostly in minority areas. Age-old standards of banking prudence got thrown out the window. In their place came harsh new regulations requiring banks not only to lend to uncreditworthy borrowers, but to do so on the basis of race.

    These well-intended rules were supercharged in the early 1990s by President Clinton. Despite warnings from GOP members of Congress in 1992, Clinton pushed extensive changes to the rules requiring lenders to make questionable loans. [...] Failure to comply meant your bank might not be allowed to expand lending, add new branches or merge with other companies. Banks were given a so-called “CRA rating” that graded how diverse their lending portfolio was. [...] In the name of diversity, banks began making huge numbers of loans that they previously would not have. They opened branches in poor areas to lift their CRA ratings.

    Meanwhile, Congress gave Fannie and Freddie the go-ahead to finance it all by buying loans from banks, then repackaging and securitizing them for resale on the open market. That’s how the contagion began. With those changes, the subprime market took off. From a mere $35 billion in loans in 1994, it soared to $1 trillion by 2008.

Readers are strongly encouraged to review this entire fact-filled piece to not only better understand the roots of today’s financial crisis, but also to get a sense as to just how absurd media accusations of this all being Bush and McCain’s fault are.

That said, from 1989 through 1995, I managed branches for two savings and loans: Imperial Savings, which got taken over by the Resolution Trust Corporation during the S&L bailout, and; Great Western Bank which eventually was purchased by Washington Mutual. The pressure to comply with CRA was astounding, especially at Great Western as it was expanding throughout the country. Its ability to acquire other institutions was directly related to its CRA rating.

With this in mind, IBD’s views concerning this matter are spot on raising a very important question: if the role of news media is to inform the public, why does a LexisNexis search indicate that as this crisis came to a head last week, its connection to CRA, Jimmy Carter, and Bill Clinton was almost completely ignored?

Would such a revelation make it difficult for Obama-loving press outlets to point fingers at George W. Bush and, more importantly, John McCain? Yes, that’s a rhetorical question.

[Soldier4Christ]

Bailout bickering triggers triple-digit loss
Oil prices rocket $25; gold trades above $900

The Dow Jones Industrial Average dropped 372.75 points today, closing at 11,015.69, amidst bickering over the government's proposed $700 billion bailout of Wall Street and concerns Democrats in Congress will block quick action until the Bush administration agrees to limit the compensation of the chief executives of financial institutions that participate in the bailout.

Both Sens. John McCain and Barack Obama expressed reservations about the Bush administration's proposed bailout, raising questions about congressional oversight assurances and concerns that the plan would give unprecedented power to U.S. Treasury officials to oversee a wide range of financial services companies, including banks, brokerage firms and mortgage-originators.

Nervous investors buffeted by yet another volatile triple-digit downward swing on Wall Street fled to gold, with gold closing at $903.50 an ounce, gaining $38.50 on the day.

Oil also gained more than $25 a barrel, the largest one-day gain ever, as oil-producing countries worried that the Wall Street bailout will result in a weakened dollar.

Crude oil for October delivery settled at $120.92 a barrel at 2:46 p.m. on the New York Mercantile Exchange, the highest settlement price since Aug. 21, according to Bloomberg.

The dollar today weakened the most against the euro since January 2001, based on concerns that the bailout will require the U.S. government to take on an unprecedented amount of debt, dramatically increasing the federal deficit, while forcing the federal government into a unprecedented intervention in the private economy.

The dollar hit $1.4866 to the euro, the lowest point since Aug. 22. The dollar has lost more than 6 percent versus the euro since touching a one-year high of $1.3882 on Sept. 11, according to Bloomberg.

Alan Ruskin, head of international currency strategy for North America at RBS Greenwich Capital Markets Inc. in Greenwich, Conn., expressed concern the dollar may slide as much as $1.50 against the euro in the next several weeks.

Last week, investors who have become accustomed to thinking of money market funds as virtually as safe as bank deposits were rudely reminded that money market funds typically carry no federal deposit guarantee.

Money market funds in the U.S. suffered an estimated $197 billion outflow last week as the par value of a few funds "broke the buck" and returned less than $1.00 a share in the once-considered safe-haven $3.4 trillion money fund industry, according to the Financial Times in London.

Goldman Sachs and Morgan Stanley shook Wall Street by announcing they have abandoned the idea of continuing operations as investment banks, preferring instead to apply to the Federal Reserve to be regulated as commercial banks.

These decisions effectively ended the model of Wall Street in which investment firms were distinct from banks, raising new questions of the future of the financial services industry in the United States.

The 1999 repeal of the Depression-Era Glass-Steagall Act during the Clinton administration eliminated the wall that had kept investment banks and depository institutions distinct, allowing banks and investment firms to merge.

Yet what the new structure of the financial services industry will look like in a world where Bear Stearns and Lehman Brothers are bankrupt and gone remains an open question.

WND's Red Alert subscription newsletter warned readers the stock market volatility of what is being called the "Panic of '08" likely will continue as long as investors remain uncertain and fearful.

The Bush administration is certain to apply continued pressure on Congress in an attempt to get a bailout plan passed this week.

Calm is unlikely to return to the stock market until investors become convinced Congress will not long debate or delay the passage of at least the fundamental components of the proposed $700 bailout plan in a form acceptable to the Bush administration, even if many fundamental questions remain to be debated until after the Nov. 4 election.

[HisDaughter]

An Amnesty for Stupidity
by  Patrick J. Buchanan

09/23/2008 

Is it fair that businessmen who fail in neighborhood stores have to close shop and often sell their homes, while Wall Street titans are spared the consequences of monumental stupidity and greed?

No, it is not fair. Yet, Treasury's Hank Paulson may be right. To save the sheep who might have been wiped out in a general financial panic, we may have to save the pigs.

Life is unfair, said JFK.

Yet, this is going to be the mother of all bailouts. Paulson will be voted by Congress authority to spend $700 billion, 5 percent of our gross domestic product, to buy all that toxic paper stinking up the books of our biggest banks.

And this is not the first such bailout of foolish and incompetent financiers and politicians.

In 1975, when its cravenness to extortionate union demands had bankrupted New York, the Big Apple had to be rescued by Gerald Ford.

Marion Barry's Washington, D.C., was next in line at the cashier's window.

In the Reagan era, it was Chrysler. Later that decade, Citibank, Chase-Manhattan and Bank of America were staring into the abyss, as Latin American regimes, to whom they had lent scores of billions, were balking at paying their debts. Uncle Sam stepped in.

Then came the Mexican and Asian financial crises and the U.S.-IMF bailouts of the 1990s. The Mexican bailout was as much a rescue of Goldman-Sachs as Mexico City, as Treasury Secretary Bob Rubin's old firm was choking on all its Mexican paper.

The great myth is that these 1990s bailouts were models of U.S. financial statesmanship and great successes. The reality is the U.S. workers took it in the neck.

For the countries bailed out, like Mexico, Thailand, Indonesia and South Korea, were forced to devalue. This radically reduced the wages of their workers relative to American workers, creating incentives for U.S. manufacturers to shut plants here and move them abroad. The devaluations also slashed the price of foreign goods relative to U.S. goods. Imports flooded in.

Who ultimately paid for the Mexican bailout? Florida tomato growers wiped out by Mexican producers, the price of whose tomatoes was chopped two-thirds by the devaluation. U.S. autoworkers who saw Ford and Delphi plants shuttered as new Ford and Delphi plants opened in Mexico. U.S. textile workers whose mills closed and jobs vanished.

Middle-class American families have paid and paid -- in lost jobs, lower wages, a falling median income -- to save the big banks from the consequences of their follies. And those bank bailouts are behind the trade deficits that set five records in the Bush era, reached 6 percent of GDP, forced huge U.S. borrowings from abroad and ravaged the dollar.

Having bailed out Latin America, Mexico, Asia and their U.S. creditors, we now find our own country in trouble. And how are our allies reacting?

"Europeans on left and right ridicule U.S. money meltdown," ran the Los Angeles Times headline. Italy's finance minister compares us to corruption-ridden Albania, where "a nationwide pyramid scheme cost hundreds of thousands of people their savings and ignited anarchic civil conflict" in the 1990s.

How will the bailout work? Will every bank that brings in toxic paper be able to dump it on the Treasury? Will the Treasury buy securities based on subprime U.S. mortgages from foreign banks? Apparently so. What about mortgage-backed securities held by U.S. companies and individual investors? Is there to be a general amnesty for bad judgment, or just a bankers amnesty?

About one thing we may be sure. The U.S. deficit and national debt are going to soar. The credit rating of the United States, as this nation of non-savers has to borrow abroad to save its banks, and their banks, is going to fall. We are going to be a poorer nation and people.

As for the promises and plans of Barack Obama and John McCain -- be it for national health insurance or middle-class tax cuts -- they are going by the wayside. For the United States is as bankrupt as Lehman Brothers, with this difference: Uncle Sam can still borrow from abroad because foreigners see many juicy U.S. assets they would like to take off our hands with their hoards of ever-cheapening U.S. dollars.

Looking at the federal budget -- the five or six major items are Social Security, Medicare, Medicaid, defense and interest on the debt. All are going up, as tax revenues fall. Add the cost of two wars and a bailout of U.S. banks that some estimate will cost $1 trillion to $2 trillion, and we appear to be looking at budget deficits ad infinitum.

"There is a great deal of ruin in a nation," Adam Smith once consoled a friend who lamented that Britain would be ruined if the 13 Colonies were lost.

We are about to test Smith's proposition

[nChrist]

It's definitely a mess, and it was caused by greed, corruption, and CRIMINAL ACTS. I honestly believe that those who are most at fault are in the Congress and Senate. It appears that the bail out must be done, but it's only common sense to take harsh actions on all criminal acts and pass laws to prevent this kind of abuse and corruption again. Some of those responsible might not have broken any existing laws, AND it's sad that they will be the ones prescribing the fix. We shouldn't be holding our breath waiting for a high quality fix. Realistically, we should know that the wolves and foxes are in charge of regulating the hen house. THE ONLY HIGH QUALITY FIXES WOULD BE HARSH CONSTITUTIONAL FIXES. READ IT AND YOU WILL FIND THAT THERE ARE VERY LIMITED METHODS THAT ARE LEGAL TO SPEND TAXPAYER MONEY. A HUGE PERCENTAGE OF ALL SPENDING HAS BEEN ILLEGAL AND UNCONSTITUTIONAL FOR A LONG TIME! By the way, I'm not hinting this should be done now. Implementing CONSTITUTIONAL spending after the bail out would certainly change things.

[nChrist]

NEWSFLASH:  This just came out a few minutes ago. The FBI has launched an investigation into the stock market crash.   GOOD!

I was beginning to wonder if anything would be done about OBVIOUS CRIMINAL ACTS! If charges aren't filed, I would simply make the blunt assumption of OBVIOUS AND MASSIVE COVERUP! At least hundreds at various levels should be charged with a variety of CRIMES! By the way, it is ORGANIZED CRIME - much like the mob would be involved with. It's also a CONSPIRACY BY ORGANIZED CRIME involving every single state. THERE SHOULD BE A MASSIVE PROSECUTION UNDER RICCO SO THAT ASSETS CAN BE CONFISCATED AND GIVEN BACK TO THE VICTIMS. IN THIS CASE, ALL TAXPAYERS ARE THE VICTIMS!

[Soldier4Christ]

It is said that Pelosi and Reid are the ones that pushed the FBI into this investigation. I certainly hope that the FBI will do so without regard to politics.

[nChrist]

It is said that Pelosi and Reid are the ones that pushed the FBI into this investigation. I certainly hope that the FBI will do so without regard to politics.

WOW! - I'm shocked! I would also hope that political party or the height of office makes no difference at all. I would also hope that they don't just offer a few scape-goats. All of those big boats, houses, cars, planes, furs, jewelry, etc. bought with money obtained by defrauding the taxpayers should now belong to the taxpayers. That's the way RICCO prosecutions work. The criminals don't get to keep their illegally gotten gains. After all, where's the common sense in fining someone $1 million when they took $50 million? AND, how is it that serving 5 years is appropriate for ruining the lives of millions? The FAT CAT CRIMINALS need to repay every cent. Whatever they owe after everything they have is seized should be billed to them and COLLECTED!

[Soldier4Christ]

Through the actions of the President, Congress and the current argument going now between McCain and Obama it is evident that we are on the verge of another Depression. In fact it may already be on us if Congress cannot put aside political disparity and come up with a sufficient plan that would stop it. Even if they do agree on some plan and put it through it is not a definite that it will help the economy all that much.

[nChrist]

Through the actions of the President, Congress and the current argument going now between McCain and Obama it is evident that we are on the verge of another Depression. In fact it may already be on us if Congress cannot put aside political disparity and come up with a sufficient plan that would stop it. Even if they do agree on some plan and put it through it is not a definite that it will help the economy all that much.

Brother, sadly I agree with you. The BEST fixes will only result in less misery. Regardless, the politicians need to get busy with fixes and forget about politics as usual. If they can't put partisan differences aside and work together to lessen this crisis, the coming negatives will simply be worse. If these clowns can't work together on something this serious, they need to be removed and replaced with people who can. It's time to forget about political parties and GO TO WORK FOR THE COUNTRY!

[HisDaughter]

Through the actions of the President, Congress and the current argument going now between McCain and Obama it is evident that we are on the verge of another Depression. In fact it may already be on us if Congress cannot put aside political disparity and come up with a sufficient plan that would stop it. Even if they do agree on some plan and put it through it is not a definite that it will help the economy all that much.

Brother, sadly I agree with you. The BEST fixes will only result in less misery. Regardless, the politicians need to get busy with fixes and forget about politics as usual. If they can't put partisan differences aside and work together to lessen this crisis, the coming negatives will simply be worse. If these clowns can't work together on something this serious, they need to be removed and replaced with people who can. It's time to forget about political parties and GO TO WORK FOR THE COUNTRY!

Amen to both.  Did anyone see the presidents speech tonight?  Amazingly it was on the only channel that I DO get.  However, I must of missed something because I really didn't hear much of a solution.  He said "recession" which I thought was minimizing the situation and then at the end he kind of gave encouragement to the effect of: "Don't worry people, it'll all be okay" at which time I felt wind being blown up my backside.

[HisDaughter]

Ever notice that when you use spell check and Obama's name is anywhere around it will ask you about it?  Spell check must think we mean Osama.....and maybe we do!   

[HisDaughter]

They Gave Your Mortgage to a Less Qualified Minority
by  Ann Coulter

09/24/2008 
 
On MSNBC this week, Newsweek's Jonathan Alter tried to connect John McCain to the current financial disaster, saying: "If you remember the Keating Five scandal that (McCain) was a part of. ... He's really getting a free ride on the fact that he was in the middle of the last great financial scandal in our country."

McCain was "in the middle of" the Keating Five case in the sense that he was "exonerated." The lawyer for the Senate Ethics Committee wanted McCain removed from the investigation altogether, but, as The New York Times reported: "Sen. McCain was the only Republican embroiled in the affair, and Democrats on the panel would not release him."

So John McCain has been held hostage by both the Viet Cong and the Democrats.

Alter couldn't be expected to know that: As usual, he was lifting material directly from Kausfiles. What is unusual was that he was stealing a random thought sent in by Kausfiles' mother, who, the day before, had e-mailed: "It's time to bring up the Keating Five. Let McCain explain that scandal away."

The Senate Ethics Committee lawyer who investigated McCain already had explained that scandal away -- repeatedly. It was celebrated lawyer Robert Bennett, most famous for defending a certain horny hick president a few years ago.

In February this year, on Fox News' "Hannity and Colmes," Bennett said, for the eight billionth time:

"First, I should tell your listeners I'm a registered Democrat, so I'm not on (McCain's) side of a lot of issues. But I investigated John McCain for a year and a half, at least, when I was special counsel to the Senate Ethics Committee in the Keating Five. ... And if there is one thing I am absolutely confident of, it is John McCain is an honest man. I recommended to the Senate Ethics Committee that he be cut out of the case, that there was no evidence against him."

It's bad enough for Alter to be constantly ripping off Kausfiles. Now he's so devoid of his own ideas, he's ripping off the idle musings of Kausfiles' mother.

Even if McCain had been implicated in the Keating Five scandal -- and he wasn't -- that would still have absolutely nothing to do with the subprime mortgage crisis currently roiling the financial markets. This crisis was caused by political correctness being forced on the mortgage lending industry in the Clinton era.

Before the Democrats' affirmative action lending policies became an embarrassment, the Los Angeles Times reported that, starting in 1992, a majority-Democratic Congress "mandated that Fannie and Freddie increase their purchases of mortgages for low-income and medium-income borrowers. Operating under that requirement, Fannie Mae, in particular, has been aggressive and creative in stimulating minority gains."

Under Clinton, the entire federal government put massive pressure on banks to grant more mortgages to the poor and minorities. Clinton's secretary of Housing and Urban Development, Andrew Cuomo, investigated Fannie Mae for racial discrimination and proposed that 50 percent of Fannie Mae's and Freddie Mac's portfolio be made up of loans to low- to moderate-income borrowers by the year 2001.

Threatening lawsuits, Clinton's Federal Reserve demanded that banks treat welfare payments and unemployment benefits as valid income sources to qualify for a mortgage. That isn't a joke -- it's a fact.

When Democrats controlled both the executive and legislative branches, political correctness was given a veto over sound business practices.

In 1999, liberals were bragging about extending affirmative action to the financial sector. Los Angeles Times reporter Ron Brownstein hailed the Clinton administration's affirmative action lending policies as one of the "hidden success stories" of the Clinton administration, saying that "black and Latino homeownership has surged to the highest level ever recorded."

Meanwhile, economists were screaming from the rooftops that the Democrats were forcing mortgage lenders to issue loans that would fail the moment the housing market slowed and deadbeat borrowers couldn't get out of their loans by selling their houses.

A decade later, the housing bubble burst and, as predicted, food-stamp-backed mortgages collapsed. Democrats set an affirmative action time-bomb and now it's gone off.

In Bush's first year in office, the White House chief economist, N. Gregory Mankiw, warned that the government's "implicit subsidy" of Fannie Mae and Freddie Mac, combined with loans to unqualified borrowers, was creating a huge risk for the entire financial system.

Rep. Barney Frank denounced Mankiw, saying he had no "concern about housing." How dare you oppose suicidal loans to people who can't repay them! The New York Times reported that Fannie Mae and Freddie Mac were "under heavy assault by the Republicans," but these entities still had "important political allies" in the Democrats.

Now, at a cost of hundreds of billions of dollars, middle-class taxpayers are going to be forced to bail out the Democrats' two most important constituent groups: rich Wall Street bankers and welfare recipients.

Political correctness had already ruined education, sports, science and entertainment. But it took a Democratic president with a Democratic congress for political correctness to wreck the financial industry.

[Soldier4Christ]

Brother, sadly I agree with you. The BEST fixes will only result in less misery. Regardless, the politicians need to get busy with fixes and forget about politics as usual. If they can't put partisan differences aside and work together to lessen this crisis, the coming negatives will simply be worse. If these clowns can't work together on something this serious, they need to be removed and replaced with people who can. It's time to forget about political parties and GO TO WORK FOR THE COUNTRY!

I have been convinced for some time now that many of those in office in congress are ones that want this to happen. After all many of them are those that wanted our government toppled and replaced back in the 60's.

Amen to both.  Did anyone see the presidents speech tonight?  Amazingly it was on the only channel that I DO get.  However, I must of missed something because I really didn't hear much of a solution.  He said "recession" which I thought was minimizing the situation and then at the end he kind of gave encouragement to the effect of: "Don't worry people, it'll all be okay" at which time I felt wind being blown up my backside.

Yes, I did see that. Keep in mind that a part of his job is to keep the people from panicking. If people did panic as they did at the start of the Great Depression then it wouldn't matter what Congress does or does not do. Such a situation would be much worse than it was back then as there are so many more people now. He has to do and say what is necessary to keep people calm.

Ever notice that when you use spell check and Obama's name is anywhere around it will ask you about it?  Spell check must think we mean Osama.....and maybe we do!  

  Yes, I have noticed that also but then my spell check also highlights Osama. I don't think it likes either one. Perhaps it's a morally correct spell checker. 

[HisDaughter]

  Yes, I have noticed that also but then my spell check also highlights Osama. I don't think it likes either one. Perhaps it's a morally correct spell checker.