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| | Full Scale Financial MeltdownPage 1 of 10 (1, 2, 3, 4, 5, 6, 7, 8, 9, 10) | De Nial is not a river in Egypt. I just have to laugh and pat myself on the back for being a Ron Paul supporter. But this isnt about that. Im just curious what you all think of this news, and I would like to hear how you think either of the candidates can best address this situation. I cant make heads or tails between the two and their double speak so I need some help with it. I ten to have my posts deleted and I hope Im constructing the question correctly. Describe how your candidate is better than the other concerning this issue. Oh and tell Bernake to keep printing that money!!!
NEW YORK - The worst global financial crisis since the Great Depression forced the Federal Reserve and central banks in other countries to pump billions of dollars into the world's banking system in an urgent bid to stop further damage.
The Fed plowed as much as $180 billion into money markets overseas. At home, the New York Federal Reserve acted to ease a spike in overnight lending rates by injecting $55 billion into the banking system.
Wall Street initially rallied, but it shed the gains and traded mostly lower by midday. Treasury securities and gold soared as investors fled to their relative safety.
President Bush canceled an out-of-town trip to stay in Washington and to huddle with Treasury Secretary Henry Paulson. Bush pledged to do all that was necessary to stem the crisis, whose fallout threatens the already fragile economy.
"The American people can be sure we will continue to act to strengthen and stabilize our financial markets and improve investor confidence," Bush said.
On Capitol Hill, lawmakers in both parties are becoming increasingly vocal about their concerns with the Bush administration's handling of the crisis.
Administration officials refused to attend a closed-door briefing with House Republicans Thursday morning, said Rep. John A. Boehner of Ohio, the GOP leader, leaving their congressional allies in the dark about recent actions to prop up insurer American International Group Inc. and whether further bailouts might be on the horizon.
"We are a separate branch of our government. (Lawmakers) are entitled to information, and I understand that there's a lot of sensitive talks underway — this is unprecedented — but having said that, members of Congress have a responsibility to their constituents and to the American taxpayers to have a better understanding of what's happening," Boehner said.
Republican presidential candidate John McCain said that if he were president, he would fire Securities and Exchange Commission Chairman Christopher Cox.
The move by the Fed and its overseas counterparts was aimed at boosting waning confidence and getting banks around the world to open their ever-tightening purse strings. Banks have been increasingly reluctant to lend to each other as distrust spread throughout the financial system.
A sharp rise in borrowing costs has worsened as bad bets on dodgy mortgage-backed securities claimed more Wall Street giants. The total amount of commercial paper fell by $52.1 billion for the week that ended Wednesday, as banks cut back the short-term loans companies from small garment factories to General Electric Co. depend on for their daily operations. At the same time, the interest rate on those short-term loans more than doubled, with rates for seven-day paper jumping to 4.5 percent from 2.5 percent.
Asian stocks closed lower. European shares rose, but struggled to maintain the gains.
Russia closed its stock exchanges for a second day Thursday as President Dmitry Medvedev pledged a 500 billion ruble ($20 billion) injection into financial markets to stem a dizzying plummet in share prices — and quash fears of a repeat of the country's 1998 financial collapse.
The Dow Jones industrials slipped about 13 points in midday trading Thursday after dropping 450 points Wednesday when a Fed bailout of American International Group Inc., one of the world's largest insurers, failed to settle the markets' frayed nerves. About $700 billion in investments vanished and trading volumes set new records Wednesday.
Investors were dumping their money into 3-month Treasury bills, considered one of the safest investments around. Gold prices spiked near $900 an ounce.
Demand for super-safe Treasuries surged Wednesday, sending the yield on the 3-month Treasury bill briefly into negative territory for the first time since 1940. That meant investors were willing to pay more for certain Treasury securities than they expected to get back when the investments matured, a rare event.
Worries that other financial companies could fail cast a pall on the central banks' step, however.
Morgan Stanley's stock price plunged again Thursday as the investment bank scrambled to strike a major deal or raise more cash that will reassure investors and prevent more damage to its free-falling shares.
John Mack, CEO of the bank — now one of only two large standalone investment banks — reached out to China's Citic Group overnight about a possible investment, according to a person familiar with the talks. Morgan Stanley is also considering a combination with retail bank Wachovia Corp. and an investment from Singapore Investment Corp., one of the world's biggest sovereign wealth funds, said the person, who spoke on the condition of anonymity because the discussions were still ongoing.
In Washington, the president was to meet with economic advisers, including Paulson, over much of the day. "Our financial markets continue to deal with serious challenges," Bush said. "As our recent actions demonstrate, my administration is focused on meeting these challenges."
Sen. Chris Dodd, D-Conn., the Banking Committee chairman, was peeved when Paulson twice canceled appearances he was to have made before the panel this week. Senators will have to wait until Tuesday to hear from the Treasury secretary and Bernanke on the financial meltdown.
A group of House GOP conservatives circulated a letter to Paulson and Bernanke calling on them to "refrain from conducting any additional government-financed bailouts for large financial firms.
"Regardless of the precautions taken, the risk to taxpayers and to the long-term future health of our economy remain just too great to justify," wrote the group, led by Rep. Jeb Hensarling, R-Texas.
Asked by lawmakers Tuesday if they could promise there would be no more government rescues of major financial institutions in the wake of the bailout for AIG, Paulson and Bernanke refused to commit, said several sources familiar with the conversation. They spoke on condition of anonymity because the meeting was private.
The Fed said it had authorized the expansion of swap lines, or reciprocal currency arrangements, with the other central banks, including amounts up to $110 billion by the ECB and up to $27 million by the Swiss National Bank.
The Fed also said new swap facilities had been authorized with the Bank of Japan for as much as $60 billion; $40 billion for the Bank of England and $10 billion for the Bank of Canada.
All told, Fed action increased lines of cash to central banks by $180 billion to $247 billion.
For more than a year, investors around the world have watched with growing alarm as the U.S. economy, the world's largest, has struggled to right itself before being tipped over the edge by massive foreclosures, shrinking consumer spending and rising inflation.
The turmoil has swallowed some of the most storied names on Wall Street. Three of its five major investment banks — Bear Stearns, Lehman Brothers and Merrill Lynch — have either gone out of business or been driven into the arms of another bank.
The two remaining — Goldman Sachs Group Inc. and Morgan Stanley — were under siege.
After the government bailed out the insurer AIG and a money fund "broke the buck," investors were worried about the riskiness of most assets.
It was the fourth consecutive day of extraordinary turmoil for the American financial system, beginning with news on Sunday that Lehman Brothers, would be forced to file for bankruptcy.
The 4 percent drop Wednesday in the Dow reflected the stock market's first chance to digest the Fed's decision to rescue AIG with an $85 billion taxpayer loan that effectively gives it a majority stake in the company. AIG is important because it has essentially become a primary source of insurance for the entire financial industry.
Jobs, too, have been affected by the tighter credit. With banks unwilling to lend, businesses are reluctant to expand. New applications for unemployment benefits rose last week, although much of that increase was due to the impact of Hurricane Gustav, the Labor Department said Thursday.
But the four-week average of new claims, which smooths out fluctuations, rose by 5,000 to 445,000. Economists consider initial claims above 400,000 a sign of a struggling economy. A year ago, the figure stood at about 320,000.
On Wednesday, the Treasury Department, for the first time in its history, said it would begin selling bonds for the Fed in an effort to help the central bank deal with its unprecedented borrowing needs.
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Posted: 9/18/2008 11:25:03 AM | .
I thought this was a good news band news Thread?
Did you forget to post the GOOD?
It is time for the US to purchase the stock of the Fed Reserve, take ownership.
We know this won't happen, but should.
We have to take control of the currency. | |
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Posted: 9/18/2008 11:35:03 AM | | To those of us who saw what was going on around us 5-10 years ago and bought gold its great news. That and there is a chance we can wake some more people from the hypnosis of the republicrats. I hope we completely melt down personally only because pain is the only motivator most people understand. And then maybe we can hire some managers ( politicians ) who will be held actually accountable for their actions... this is good news to real americans who cant stand whats going on in D.C. | |
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Posted: 9/18/2008 11:36:58 AM | And this is no accident by the way, this paves the way for the Amero. Then they only have to come up with a middle east & asian currency. Then roll the big 4 into one currency. Stay tuned, the best is yet to come...  | |
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Posted: 9/18/2008 3:43:34 PM | Hey OP, you forgot to include the copyright on your post...
© Copyright 2008
Allbritton Communications Company and The Associated Press
All rights reserved. This material may not be published, broadcast, rewritten or redistributed | |
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Posted: 9/18/2008 6:37:17 PM | I just hope they made the right decision. Because if it is another BLOOPER from Mr. Bush.. WE ARE TOTALLY SCREWED...!!! ..
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Posted: 9/18/2008 7:46:59 PM | | From an investing stand point there is nothing like floating a loan to a company on the brink of bankruptcy. | |
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Posted: 9/19/2008 5:51:07 AM | True,... to an extent..! Is known to every one that the FED is there to loan money to every one or financial institution that requires a loan. But such banks base their operations on REPUTATIONS. And they almost never ask for help from the FED (I did some research and only a couple of such institutions asked for that help in the past 40 years. They both are history now ). The reason for this is that, once they ask for that lifeline, they submit themselves to the scrutiny of the government and ALL its BUROCRACY.!! .. In other words, they don't want others to KNOW they are bankrupt. So, they PREFER to ask other institutions for cash flow. Even if this means paying sometimes up to 40% in interest... FORTY PERCENT>>!!. If no one wanted to loan money to such institutions, that means that their CREDIBILITY (as in credit) was completely eroded. What the government did, is worrisome. Is like lending money to someone, who already OWES money, to pay the interest of the money that such fiscal individual already OWES!! BAD BUSSINES... There is a very SLIM chance of recovery. Let's just hope for the best.
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Posted: 9/19/2008 6:24:39 AM | You'd think FEMA was running the the FED. They don't know what they're fvcking doing. Everyone knew the crunch would come. With word of dumping the FED, you'd think they would have been prepared to prove everyone wrong by at the very least having a plan ready for this most obvious scenario.
The US needs someone like JFK. Funny how he got assassinated after he said he was going to close down the FED. Conspiracy my arse. | |
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Posted: 9/19/2008 7:24:30 AM | As I said before, I just hope this is not a bluff. Because if other countries like China or Russia, (not to mention Saudi Arabia or IRAN ) calls it off and put THEIR bets on the table, We are TOTALLY screwed...
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Posted: 9/19/2008 7:45:18 AM | By the way, NOW is the time for those entrepeneurs to START small business, that is, if You have or can get the money to start up. If this whole thing works out, You will have a VERY WELL established business... This is the time to be patriotic and BUY AMERICAN products... Even though some of them are actually s..ht. But WE need to contribute. There will be another time to deal with our politicians... Right now, We need to stay focused in the crisis at hand... Thank You very much, SIRS AND MADAMS POLICY MAKERS... YOU HAVE DONE IT AGAIN...!!!
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Posted: 9/19/2008 9:22:25 AM |
You'd think FEMA was running the the FED. They don't know what they're fvcking doing.
>>>>>>>
Thank You very much, SIRS AND MADAMS POLICY MAKERS... YOU HAVE DONE IT AGAIN...!!!
What?
They Don't know what they are doing?
It would appear to me "They" are doing fine. The few with the lowest tax rate, have increased their worth. No Jail time. No penalty.
The Largest transfer of wealth ever.
Policy makers work for those with the loudest voice (cash equals speech). They have preformed very well.
Just cause you got screwed does not mean it is wrong. Winners and Losers...
We are the losers.
I'm not a member of the lucky sperm club. How did you screw up?
This is not the end, this may be the start of the end.... BUT this cow has a lot more milk. | |
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Posted: 9/19/2008 9:29:48 AM | Where is the problem? The Free Market system is working well. In good times the big corporations make lots of money and when times get bad the government bails them out.
The trick here is to be a big corporation, not an individual or small business. | |
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Posted: 9/19/2008 9:31:53 AM |
It would appear to me "They" are doing fine. The few with the lowest tax rate, have increased their worth. No Jail time. No penalty.
The Largest transfer of wealth ever.
Do tell. To whom was all this "wealth" transferred? | |
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Posted: 9/19/2008 11:14:34 AM | .
Me either!!! Oh my God... Priceless!
Having know a few people in the Billionaire sperm club.....
I was better off.
Do tell. To whom was all this "wealth" transferred?
You don't believe the 1% have done very well? there are seaveral articles you should check out.
http://www.rollingstone.com/politics/story/12699486/paul_krugman_on_the_great_wealth_transfer
http://blogs.wsj.com/wealth/2007/06/05/why-richistan-why-now/
The wealthy weren’t just getting wealthier — they were forming their own virtual country. They were wealthier than most nations, with the top 1% controlling $17 trillion in wealth. And they were increasingly building a self-contained world, with its own health-care system (concierge doctors), travel system (private jets, destination clubs) and language. (”Who’s your household manager?”) They had created their own breakaway republic — one I called Richistan.
As a former foreign correspondent, I decided to cover Richistan just as I would cover another country. I wouldn’t judge the rich as heroes or villains, any more than I would judge Indonesians when covering Indonesia. My job would simply be to tell the reader what their world is like and what’s happening there.
Why now? As the chart over there on the right shows, never before have so many Americans become so rich so quickly. The number of millionaire households at every level ($1 million, $10 million, $100 million) has more than doubled over the past decade. And there are no signs that the wealth explosion will slow.
The real story behind all this wealth, however, isn’t in the numbers. It’s in the people, and how they’re changing the culture and character of wealth in America. Richistan is largely about a country in flux — one in which Old Money is being shoved aside by self-made entrepreneurs, philanthropy is changing from passive check-writing to “high-engagement philanthropy,” and the progressive new rich are changing the politics of wealth. Most of all, Richistan is about the entertaining way that today’s rich are making, spending, donating and living with their wealth. (Like the guy in my book who has a house staff of 105 people.)
Yes, the rich have been getting richer for ages. But increasingly, Richistan is driving our economy, our culture and our spending habits. Or, as John Kenneth Galbraith once said, “Of all the classes, the wealthy are the most noticed and the least studied.”
$17 trillion the US has a $14 trillion economy?
$750,000 watches, with a waiting list... designer bags.... BIG houses... Submarines...
How has the Forbes 400 list changed the past 8 years....
ALL over a Billion. In 2000 started at $750 million.
How well have the middle income and poor rich done??
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Posted: 9/19/2008 11:15:08 AM | Mr. Jack, just for clarification, I was being sarcastic whe I said "thank You very much". I was trying to say that our "elected" officials are in competition with the energizer bunny. Because they "keep going... and going... and going...." making bed decisions and mistakes. And trust me.. I am WWWAAAYYYY far from belongin or being part of ANY club... 
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Posted: 9/19/2008 12:17:18 PM | Mr. Jack, I took the liberty of looking at some of your post in other forums. And I will apreciate that next time YOU quote me, PLEASE take the time to look at my posts here and in other forums... That will clarify things for You...
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Posted: 9/19/2008 7:42:35 PM | | I dont know anything about high finance, but I think I'd like to bring into this thread an important observation.... People like to point out how well Bush has done as a president by alluding to the fact that we havnt been attacked again since 911. People then equate that to mean only the repubs can protect us. But I'd like to point out the real reason we havnt been attacked again is because the terrorists have achieved their exact goal...to cause financial upheavel in the USA. They have achieved exactly that! So Bush never really did protect us because Bin Laden got exactly what he wanted. The taking down of the towers was simply destroying the iconic symbol of American materialism, finance and capatilism...the rest Bush did on his own! | |
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Posted: 9/19/2008 9:19:57 PM | | Guy, most definitely I agree with you 100%. This as well as many other things like the invasion of Iraq, the arrogance toward other nations, the Patriot Act, the economic collapse (mostly due to steps taken to build a paper tiger housing economy in direct response to the attack) all have gone precisely to script as desired by Al Qaeda. Why waste and expend resources to accomplish what you already have? The administration and most of us were like dogs at the races chasing the wooden rabbit. | |
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Posted: 9/19/2008 10:47:44 PM | McCain will solve it. The most respected financial newspaper just blasted McCain for not knowing what he's talking about on economic issues.
http://online.wsj.com/article/SB122178318884054675.html?mod=todays_us_opinion | |
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Posted: 9/20/2008 12:33:03 AM | "those of us who saw what was going on around us 5-10 years ago "
Saw it more like over 15 years ago, called it, was sooooo assured that they had put the regulations in to prevent another 1929. Watched as they removed more and more of the regulations that would prevent another 1929.
My call on this? I knew SSN would not be enough so I had lived well within my budget and done all the proper conservative investments to supplement my SSN .... everything they have said to do if they privatized SSN I have done ..... I am now proof positive that privatizing SSN is a reaaaaaaaaaaly bad bad idea. Retirement annuity - in shambles. IRA, 401k, Keogh ... ouch, sigh. Home, hanging in there but 30% loss to significantly below purchase price. Investment art .... might be holding value, I hope. Long term care insurance? I am hoping the AIG rescue is keeping that safe.
Not as if I speculated .... so, lesson learned... do not privatize SSN. | |
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Posted: 9/20/2008 3:49:45 PM |
do not privatize SSN.
They already have... All the SS money is being used to cover the huge Corperate losses.
If you work until your are 80 and leave all your investments alone you will be fine. The market has historically come back. You have to look at the long haul..... Over the next 30-60 years it will show a gain. | |
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