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Government shuts down silver state bank - 11th failure in 2008
Regulators on Friday shut down Silver State Bank, saying the Nevada bank failed because of losses on soured loans, mainly in commercial real estate and land development.
It was the 11th failure this year of a federally insured bank...
... Andrew K. McCain, a son of Republican presidential nominee John McCain, sat on the boards of Silver State Bank and of its parent, Silver State Bancorp, starting in February but resigned in July citing... (Rest at link...) Regulators on Friday shut down Silver State Bank, saying the Nevada bank failed because of losses on soured loans, mainly in commercia... more -
US government to seize mortgage giants, could cost taxpayers billions
The government is expected to take over Fannie Mae and Freddie Mac as soon as this weekend in a monumental move designed to protect the mortgage market from the failure of the two companies, which together hold or guarantee half of the nation's mortgage debt, a person briefed on the matter said Friday night.
Some of the details of the intervention, which could cost taxpayers billions, were not yet available, but are expected to include the departure of Fannie Mae CEO Daniel Mudd and Freddie Mac CEO Richard Syron, according to the source, who asked not to be named because the plan was yet to be announced.
Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson and James Lockhart, the companies' chief regulator, met Friday afternoon with the top executives from the mortgage companies and informed them of the government's plan to...
Read The rest at the link... The government is expected to take over Fannie Mae and Freddie Mac as soon as this weekend in a monumental move designed to protect th... more -
Weak U.S. jobs data hits global stocks
World stocks extended losses to fresh two-year lows while save-haven government bonds rallied on Friday after a surprisingly weak U.S. jobs report deepened worries about the health of the global economy.
The U.S. unemployment rate shot up to 6.1 percent in August, its highest in more than 4-1/2 years, while the economy lost a higher-than-expected 84,000 jobs last month.
Interest rate futures moved to show a small chance the Federal Reserve might cut rates later this year. U.S. stock futures remained in the red, indicating a weaker opening on Wall Street, which posted its steepest decline in more than two months on Thursday. World stocks extended losses to fresh two-year lows while save-haven government bonds rallied on Friday after a surprisingly weak U.S.... more -
Thousands rally at Ron Paul Convention - CNN.com
The one candidate who offered real change, discussed real issues, and gave real solutions.
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HOPE FOR THE BEST
"A people living under the perpetual menace of war and invasion is very easy to govern. It demands no social reforms. It does not haggle over expenditures for armaments and military equipment. It pays without discussion, it ruins itself, and that is an excellent thing for the syndicates of financiers and manufacturers for whom patriotic terrors are an abundant source of gain" - Anatole France
PROUD OF WHAT ONE IGNORES ?
http://www.nowpublic.com/world/proud-what-one-ignores
PRIVATIZE THE PROFITS & SOCIALIZE THE LOSS * Even now, after all of their dishonesty and failure, Fannie and Freddie could emerge from this taxpayer rescue more powerful than ever. Mussolini said that fascism is quite simply the corporate state. This story ends all speculation that we are living in a fascist empire where it is impossible to determine where corporations end and government begins and vice-versa. Disaster Capitalism triumphant !
"A society whose citizens refuse to see and investigate the facts, who refuse to believe that their government and their media will routinely lie to them and fabricate a reality contrary to verifiable facts, is a society that chooses and deserves the Police State Dictatorship it's going to get." - Ian Williams Goddard
NATION OF WHINERS GOES ON SUICIDE BINGE !
http://www.nowpublic.com/world/nation-whiners-goes-suic...
Washington has become Versailles. We are ruled, entertained and informed by courtiers. The popular media are courtiers. The Democrats, like the Republicans, are courtiers. Our pundits and experts are courtiers. We are captivated by the hollow stagecraft of political theater as we are ruthlessly stripped of power. It is smoke and mirrors, tricks and con games. We are being had. - Chris Hedges
A democratic civilization will save itself only if it makes the language of the image into a stimulus for critical reflection — not an invitation for hypnosis." - Umberto Eco "A people living under the perpetual menace of war and invasion is very easy to govern. It demands no social reforms. It does not... more -
Fed Keeps Rate at 2% as Inflation Accelerates, Growth Stagnates
The Federal Reserve kept its benchmark interest rate at 2 percent for the second consecutive meeting as inflation accelerates and the economic slowdown shows signs of deepening.
``Although downside risks to growth remain, the upside risks to inflation are also of significant concern to the committee,'' the Federal Open Market Committee said in a statement today in Washington.
Chairman Ben S. Bernanke is constrained by threats to both sides of his mandate to achieve stable prices and full employment. A rate cut risks pushing inflation higher still; an increase would further tighten credit, undermine troubled banks and starve the faltering economy of investment and spending.
``Labor markets have softened further and financial markets remain under considerable stress,'' the Fed's statement said. ``Tight credit conditions, the ongoing housing contraction, and elevated energy prices are likely to weigh on economic growth over the next few quarters.''
(End of excerpt)
Full article at link by Craig Torres// Bloomberg.com: Worldwide
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Image by flickr user azrainman
http://flickr.com/photos/azrainman/2085541144/
Licensed under Creative Commons Attribution 2.0 Generic
http://creativecommons.org/licenses/by/2.0/deed.en The Federal Reserve kept its benchmark interest rate at 2 percent for the second consecutive meeting as inflation accelerates and the ... more -
Florida bank closed by FDIC - Aug. 1, 2008
Federal regulators closed Florida's First Priority Bank on Friday, marking the eighth bank failure of the year.
The Federal Deposit Insurance Corp., which was named the receiver of the failed bank, entered into an agreement with Atlanta-based SunTrust Bank (STI, Fortune 500) to assume the insured deposits of First Priority.
All six branches of the Bradenton, Fla.-based bank will reopen on Monday as branches of SunTrust. First Priority depositors will automatically become depositors of SunTrust, the FDIC said.
First Priority had assets of $259 million and total deposits of $227 million, according to the FDIC. That includes $13 million in uninsured deposits held in approximately 840 accounts that potentially exceeded the federal insurance limits.
Account holders with more than the $100,000 insured limit will essentially "become a creditor" of the failed bank, said FDIC spokesman Andrew Gray.
Those accounts will be credited as the FDIC sells more of the failed bank's assets, Gray said.
SunTrust Bank will purchase approximately $42 million of the failed First Priority's assets, which are made up of mainly cash, cash equivalents and securities.
And LNV Corp. of Plano, Texas, a subsidiary of Beal Bank Nevada, will purchase $14 million in First Priority's assets.
The remaining $171 million in assets will be sold by the FDIC. Proceeds of these sales will be used to pay creditors including bank clients whose accounts exceed the $100,000 limit. Federal regulators closed Florida's First Priority Bank on Friday, marking the eighth bank failure of the year. ... more -
Fannie and Freddie symptoms of larger problem
AFL-CIO economist says this system amounts to "Socialism for the rich and capitalism for the poor".
The Federal Reserve and the Treasury announced steps on Sunday to shore up mortgage giants Fannie Mae and Freddie Mac, whose shares have plunged as losses from their mortgage holdings threatened their financial survival. Congress has been asked to approve a sweeping rescue package that would inject billions of federal dollars into the the faltering companies. Separately, the Federal Reserve said that it would promote up to $300 billion dollars of short-term low interest loans to Fannie and Freddie. AFL-CIO chief economist, Ron Blackwell, emphasized both the need to bail out Fannie and Freddie and the urgency of addressing the systemic problems that produced their collapse. He says that the current system amounts to Socialism for the rich and Capitalism for the poor.
Ron Blackwell is Chief Economist for the AFL-CIO, where he has also worked as Director of Corporate Affairs. Before coming to the AFL-CIO, Blackwell was assistant to the president of the Amalgamated Clothing and Textile Workers Union, and chief economist of UNITE (Union of Needletrades, Textiles and Industrial Employees). Prior to joining the labor movement, Blackwell was an academic dean at the New School for Social Research in New York (now the New School University), where he taught economics, politics and philosophy. AFL-CIO economist says this system amounts to "Socialism for the rich and capitalism for the poor". ... more -
What will real economic change look like?
Downturn and record high deficit mean next Prez must protect Americans from 'vagaries of the market'.
The new US national deficit numbers announced on Monday, a record high, were the latest sign of an economy in decline, with foreclosures rising, home prices falling, soaring energy prices and nearly a half-million jobs lost since January. Democratic presidential hopeful Barack Obama, met with more than a dozen economic advisers in Washington, DC. Obama's economic team includes deregulators Paul Volcker, Robert Rubin and Paul O'Neill. TRNN speaks with economist and author Ellen Frank: "it's not clear that these are the people that are going to lead us to a new regulatory environment that can prevent some of the problems that we're living through right now".
Ellen Frank, Associate Professor of Economics at the University of Massachusetts, Boston, a member of the Dollars & Sense collective. She is the author of The Raw Deal: How Myths and Misinformation about Deficits, Inflation, and Wealth Impoverish America , was published in 2004. Downturn and record high deficit mean next Prez must protect Americans from 'vagaries of the market'. ... more -
After 7 Years, Talks on Trade Collapse
Us Economy too weak to negotiate trade agreements.
GENEVA — World trade talks collapsed here on Tuesday after seven years of on-again, off-again negotiations, in the latest sign of India’s and China’s growing might on the world stage and the decreasing ability of the United States to impose its will globally.
Pascal Lamy, director general of the World Trade Organization, could not bridge differences between a group of newly confident developing nations and established Western economic powers. In the end, too few of the real power brokers proved committed enough to make compromises necessary to deliver a deal.
The failure appeared to end, for the near term at least, any hopes of a global deal to further open markets, cut farm subsidies and strengthen the international trading system.
“It is a massive blow to confidence in the global economy,” said Peter Power, spokesman for the European Commission. “The confidence shot in the arm that we needed badly will not now happen.”
After nine consecutive days of high-level talks, discussions reached an impasse when the United States, India and China refused to compromise over measures to protect farmers in developing countries from greater liberalization of trade.
Supporters of the so-called Doha round of talks, which began in 2001, say a deal would have been a bulwark against protectionist sentiments that are likely to spread as economic growth falters in much of the world.
The failure also delivers a blow to the credibility of the World Trade Organization, which sets and enforces the rules of international commerce. It could set back efforts to work out other multilateral agreements, including those intended to reduce the threat of global warming.
The collapse of the talks will not bring an end to world trade, of course, which will continue under current agreements, many of which are between two or more countries rather than under the W.T.O.
But it is a big setback, particularly to the hopes of smaller and poorer developing countries, which were counting on gaining greater access to consumers in the United States, Europe and Japan.
Economists and trade experts predicted that negotiators, having come this close, might not find the conditions for a broad deal among the 153 members of the trade organization for years, if ever again.
Deep skepticism about the advantages of free trade was on vivid display during the Democratic primaries and it is growing in Europe, particularly as France, Italy and other countries have fallen into an American-style economic malaise. Us Economy too weak to negotiate trade agreements. ... more -
Last hurrah for the banking system
FDIC has only $53 billion in reserves to guarantee $4 trillion in total bank deposits.
As the bank-runs increase, the FDIC will be forced to admit the truth, that they don't have the resources to deal with a problem this big. Currently, the FDIC has only $53 billion in reserves to guarantee $4 trillion in total bank deposits. The entire system has a mere $267 billion cash in the vaults. What a shabby way to run a banking system. Where's the money going to come from when depositors start withdrawing their savings? How will the FDIC deal with the ongoing deleveraging in the market which is forcing more and more investors move into cash?
On Friday, after the market had closed, the FDIC shut down two more banks, First Heritage Bank and First National Bank. Two weeks earlier, regulators seized Indymac Bancorp following a run by depositors. The FDIC now operates like a stealth paramilitary unit, deploying its shock troops on the weekends to do their dirty work out of the public eye and at times when it will least effect the stock market. The reasons for this are obvious; there's only one thing the government hates more than seeing flag-draped coffins on the evening news, and that's seeing long lines of frantic soccer moms and blue-collar working guys waiting impatiently to get what's left of their savings out of their now-deceased bank. After all, flag-draped coffins merely indicate that we're losing a war, but lines at the bank prove that the system is broken. And the system is broken, that's why people are depressed and confidence is waning.
Last Sunday, sought Treasury Secretary Henry Paulson tried to reassure the public that the banking system is sound, while bracing people for more trouble ahead:
* "I think it's going to be months that we're working our way through this period — clearly months. But again, it's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation."
Paulson is like a broken record. Everything is always hunky-dory. He is the consummate Wall Street investment sharpie; a bright guy who could charm a hungry dog off a meat-wagon. But when it comes to telling the truth; forget about it. You'd be better off listening to Bush, which isn't saying much. The banking system is not sound nor is it well capitalized. It is a corpse that's been propped up in the office hallway next to the water-cooler so that everyone who passes bye gets a stifling whiff of the decaying flesh. Still, the charade goes on. Still the lies persist.
If the rate of bank closures continues at the present pace, by the middle of 2009 their will be restrictions on withdrawals. Even now, if you go to your bank and try to withdraw $9,000 or $10,000, it sends waves of panic through the entire building like a 5-alarm fire that quickly engulfs the main exits. It's crazy. Tellers go scampering around helter-skelter, and bank managers suddenly appear at the window grimacing in pain and wringing the sweat from their brows.
Most people are unaware of the fact that the new Fannie Mae and Freddie Mac bailout package that was passed into law on Saturday, provides Paulson with $300 billion of taxpayer dollars to shore up the faltering mortgage behemoths. In order to accomplish this, the congress increased the national debt by a whopping $800 billion sending it over the $10 trillion mark for the first time in history. FDIC has only $53 billion in reserves to guarantee $4 trillion in total bank deposits. ... more -
Peter Schiff predicting our current economic condition back in 2006!
In 2006, Peter Schiff, President and Chief Global Strategist of Euro Pacific Capital, spoke at the Western Regional Mortgage Bankers Association Meeting in Las Vegas and told over 1000 mortgage brokers that they were about to be out of jobs. The entire presentation is worth watching but most of his comments regarding real estate begin at the fourth video (Above video is the intro and the remaining 7 appear below.)
Mr. Schiff, an advocate of Austrian Economics and former Ron Paul presidential campaign advisor, is the author of "Crashproof: How to profit from the coming economic collapse." He has appeared on CNBC, CNN, FBN, Bloomberg, CBS and other networks. CNBC has called him "Dr. Doom" and he is still criticized by the mainstream financial pundits despite his correct predictions of the tech and mortgage bubbles. In 2006, Peter Schiff, President and Chief Global Strategist of Euro Pacific Capital, spoke at the Western Regional Mortgage Bankers A... more -
Record '09 Deficit of $482 Billion
White House forecasts deficit of $389 Billion in 2008
The Bush administration forecasts the nation's budget deficit will hit $389 billion this year, increasing to a record $482 billion next year, reflecting shrinking tax revenue brought on by a weakened economy.
The projected budget shortfall in the fiscal year ending Sept. 30 is $21 billion less than President George W. Bush forecast five months ago while next year's shortfall is expected to come in 18.4 percent higher than the $407 billion in the earlier projection.
``These projected deficits are both manageable and temporary if spending is kept in check, the tax burden remains low and the economy continues to grow,'' White House Budget Director Jim Nussle said in the report delivered to House Speaker Nancy Pelosi, Democrat of California.
``Despite the recent slower economic growth'' brought on by declines in the housing market, disruptions in the credit markets and higher food and energy prices, ``the nation's economy has continued to expand and remains fundamentally resilient,'' the report said.
Even so, the White House lowered its forecast for U.S. economic growth this year and next. The budget office said the gross domestic product is being reduced to a 1.6 percent rise this year, compared with a 2.7 percent increase estimated five months ago.
Next year, the economy may expand 2.2 percent, instead of the 3 percent increase projected in February. White House forecasts deficit of $389 Billion in 2008 ... more -
FDIC takes over 2 more banks, closing 28 branches
"CARSON CITY, Nev. (AP) — The 28 branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California, were closed Friday by federal regulators.
The banks, owned by Scottsdale, Ariz.-based First National Bank Holding Co., were scheduled to reopen on Monday as Mutual of Omaha Bank branches, the Federal Deposit Insurance Corp. said.
The FDIC said the takeover of the failed banks was the least costly resolution and all depositors — including those with funds in excess of FDIC insurance limits — will switch to Mutual of Omaha with "the full amount of their deposits."
Hopefully, these depositors and account holders will be insured up to the federal limit of $100,000.00. This is the second FDIC takeover since the IndyMac branches in California!! "CARSON CITY, Nev. (AP) — The 28 branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona an... more -
Inflation Deflation Red-flation Blue-flation
"A debate has been raging for some time among those in the finance industry about whether the United States is currently experiencing inflation, deflation, stagflation, reflation, hyperinflation, or maybe even some other sort of "-flation" that only Dr. Seuss could imagine.
Unfortunately, much of this debate is unproductive because the participants use varying definitions of these terms, and even when they use the same ones, deciding on one simple label might not be sufficient to describe the deeper economic forces at work and what their effects are likely to be. Given the confusion, this article will add some color to the debate by offering usable definitions of the terms inflation and deflation and then attempt to show what is occurring in today's economy."
(End of excerpt)
Full article at link by Matthew Beller// Ludwig von Mises Institute "A debate has been raging for some time among those in the finance industry about whether the United States is currently experien... more -
Economic Depression Then and Now
On Tuesday and Wednesday, Federal reserve chairman Ben Bernanke, a scholar of the epic financial meltdown of the Great Depression, and Treasury Secretary Henry Paulson, a survivor of more recent Wall Street crises, told Congress of their latest efforts to rescue the financial sector. If Fed chairman Alan Greenspan, Clinton Treasury Secretary Robert Rubin and his deputy Lawrence Summers were known as the Committee to Save the World during the financial crises of the 1990s, today's duo may go down as the Committee to Save Wall Street From Itself. For the past several months, the Fed and the Treasury Department have pulled all-nighters dealing with three-alarm fires, from the demise of Bear Stearns in March to the rising concerns over the mortgage giants Fannie Mae and Freddie Mac.
Fannie and Freddie play a huge role in the mortgage business by lending cash and guaranteeing loans made by others. But with the spread of the mortgage crises their stocks have plummeted in recent weeks, and questions have been raised as to whether the government would do what it implied it would all along when it established the two government sponsored organizations: stand behind their debt. Bernanke and Paulson gave an emphatic "yes," as they described to occasionally hostile Congress members their plans to allow Fannie and Freddie to borrow money from the Federal Reserve, and to empower the Treasury Department to buy (and buoy) the companies' stock and stand behind their $5.2 trillion in debt. The prospective moves, along with some slightly better-than-expected earnings reports from banks last week, calmed the markets. The price for this desperately needed action is likely to be more regulation and oversight. Will the crisis inspire a fundamental restructuring of the vital, symbiotic relationship between Washington and Wall Street, as happened during the New Deal? Or will these responses prove a temporary blip, as when the government bailed out the savings and loan industry in the late 1980s? In short, is this 1933 or 1989? On Tuesday and Wednesday, Federal reserve chairman Ben Bernanke, a scholar of the epic financial meltdown of the Great Depression, and... more -
"Armed and Dangerous": Secretary Paulson's radical remedies
This week, with the nation’s financial infrastructure crumbling before our very eyes, the nation’s top two economic policy makers made their way to the Congress for an extraordinary episode of political theater. Fannie Mae and Freddie Mac, the quasi-government entities that form the backbone of America’s gargantuan mortgage market, appeared to be cracking. To the somewhat bewildered members of Congress, Ben Bernanke and Henry Paulson offered radical remedies to save the lenders. Despite the fact that the proposed policies would thoroughly redefine America’s supposedly capitalistic pedigree, the moves were presented as wholly inevitable, and in the end, benevolent and costless.
If you are looking for a new chapter in American history, it has just begun.
The most memorable moment in the episode came when Secretary Paulson explained that the best way to minimize the chances that Fannie Mae and Freddie Mac will need a government bailout would be for Congress to grant the Treasury unlimited authority to lend to the two institutions. His analogy: When the bad guys see a bazooka on your hip, you are less likely to be challenged to a gunfight...
... At present, the best the government can do for housing and the economy is to leave both alone, cease interference in the free market, restore sound money, and allow capitalism to work.
Unfortunately, the laws of capitalism are now demanding that home prices continue to fall precipitously. But, based on the speed in which our government, public and financial institutions are willing to abandoned free market principals at the first whiff of economic pain, the likelihood that this impulse will take hold is increasingly remote. So hunker down as the United States finds itself on the express track to state socialism with Paulson’s Bazooka locked, loaded and pointed right at us. When the government pulls the trigger the blast will blow the dollar, and what’s left of our capitalist economy, to smithereens."
(End of excerpt)
Full commentary "Armed and Dangerous" (July 18th, 2008) at link by Peter Schiff, President & Chief Global Strategist// Euro Pacific Capital This week, with the nation’s financial infrastructure crumbling before our very eyes, the nation’s top two economic policy makers made... more -
Ron Paul tells Bernanke he is the "biggest taxer in the country" at Mone...
Segments of Congressman Paul (R-TX) addressing Fed Chairman Ben Bernanke at the Humphrey Hawkins Hearing on Monetary Policy on July 16th. Paul speaks about the problems with the Federal Reserve system and the current economic crisis. When making his point about the damaging consequences of inflation (3:29) Paul stated: "... Inflation is a tax. And if the Federal Reserve and you as chairman have this authority to increase the money supply arbitrarily you're probably the biggest taxer in the country. You're a bigger taxer than the congress..."
Congressman Ron Paul's Statement before the Financial Services Committee
http://www.house.gov/apps/list/hearing/financialsvcs_de...
Archived webcast of Humphrey Hawkins Hearing on Monetary Policy
http://financialserv.edgeboss.net/wmedia/financialserv/...
House Financial Services Committee
http://www.house.gov/apps/list/hearing/financialsvcs_de...
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Video by YouTube user PopularHypocrisy Segments of Congressman Paul (R-TX) addressing Fed Chairman Ben Bernanke at the Humphrey Hawkins Hearing on Monetary Policy on July 16... more -
The 10 Worst Corporations of 2007
Neither Honest Nor Trustworthy: The 10 Worst Corporations of 2007
by Russell Mokhiber and Robert Weissman
The U.S. public holds Big Business in shockingly low regard.
A November 2007 Harris poll found that less than 15 percent of the population believes each of the following industries to be "generally honest and trustworthy:" tobacco companies (3 percent); oil companies (3 percent); managed care companies such as HMOs (5 percent); health insurance companies (7 percent); telephone companies (10 percent); life insurance companies (10 percent); online retailers (10 percent); pharmaceutical and drug companies (11 percent); car manufacturers (11 percent); airlines (11 percent); packaged food companies (12 percent); electric and gas utilities (15 percent). Only 32 percent of adults said they trusted the best-rated industry about which Harris surveyed, supermarkets.
With the 10 Worst Corporations of 2007, we aim to show - again - that Big Business is out of control and to connect comparable abuses to the failure of government overseers, regulators and enforcers.
Presented alphabetically, here are the 10 Worst Corporations of 2007:
http://www.multinationalmonitor.org/mm2007/112007/mokhi... Neither Honest Nor Trustworthy: The 10 Worst Corporations of 2007 by Russell Mokhiber and Robert Weissman ... more -
Fed ready to aid investment banks
The Federal Reserve may extend into next year a facility that gives investment banks access to emergency cash if the financial turmoil persists.
The lending facility was put in place in March to stabilise the financial system as Bear Stearns collapsed.
Fed chairman Ben Bernanke also called on Congress to give the central bank more authority to supervise markets.
The Fed will issue new rules next week aimed at cracking down on dubious lending practices.
(End of excerpt)
Full article at link by BBC News
Photo: AP The Federal Reserve may extend into next year a facility that gives investment banks access to emergency cash if the financial turmoil... more
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