Laigle’s Forum

Most Americans are puzzled and, of these, most are angry that Tim Geithner and Obama keep forking over our cash to a failing Europe via the IMF.

In fact, these politicians are some of the few who realize that the US Left actually triggered the world economic crash and therefore, in a sense, owes Europe and everyone else an apology at the very least.

It is interesting that even the most conservative authors, writing on the economy, rightfully blame the banks, the Fed and the 1999 repeal of Glass-Steagall for the economic crash, but most of them fail to look back at the prime cause, the bleeding heart giveaway policies of the CRA (Community Reinvestment Act). True, these other factors were absolutely key and no one is denying that. But without the CRA, it would not have happened, at least not in the same way.

“Most people do not realize this, but derivatives were at the center of the financial crisis of 2008,” states an article at theeconomiccollapseblog.com.

Nothing wrong with that statement. (This blog is in fact one of the best sources available on the progress of the West’s current economic suicide attempt.)

Indeed, neither party noticed the enormous destructive power of these instruments back when the market was bearish.

But let’s be more specific. In the case of the current crisis, it was not just any old derivatives that caused the initial tremor in the markets. It was mostly a derivative known as MBSs, or mortgage backed securities, that got the avalanche rolling. And the repeal of Glass-Steagall (which had denied banks the right to act as both investment houses and banks) was the enabler.

However, we need to look back further to find the root cause. To recap for those who have forgotten: Back in the 70s Carter, always the bleeding heart and skeptic of the free market, decided banks were deliberately refusing to service blacks, Hispanics, etc, on the basis of race. That assumption was in itself unproven at best and maliciously phony at worst. Nonetheless, the CRA (Community Reinvestment Act) became the law of the land in 1977. No one tried to seriously enforce this law until Clinton became president because Republicans used to know that forcing banks to lend to the insolvent would inevitably lead to ruin. Ironically, by the founding of the Clinton Dynasty, businesses were even more conscientious than before about eliminating racial considerations from their lending practices. A well-off black men could secure a loan just as easily — if not more easily (thanks to affirmative discrimination) — than a white man.

But Clinton had declared himself the “first black president” and he had to live up to his absurd title. So his HUD secretary Henry Cisneros, with equal absurdity, started to put teeth into the law that had, mercifully, lay fallow in the intervening years:

Here is what the CATO Institute says:

In 1992, HUD was given regulatory authority over these government-sponsored enterprises, and it began pushing the two firms into the subprime lending business.

The ensuing horrors we see all around us could perhaps have been mitigated, or even averted, had GW Bush not tried so hard to be a “compassionate conservative” (code for socialist in sheep’s clothing). In fairness, Bush had initially warned against these policies, but by January 2004, his HUD web site was trumpeting:

“Offering FHA mortgages with no down payment will unlock the door to homeownership for hundreds of thousands of American families, particularly minorities,” said HUD’s Acting Secretary Alphonso Jackson. “President Bush has pledged to create 5.5 million new minority homeowners this decade, and this historic initiative will help meet this goal.”

It was the serious enforcement of a less-than-serious law, coupled with the repeal of another law that would have prevented the securitization and sale of mortgages that indirectly led to a debacle that has engulfed the entire world and has led to a situation in which derivatives with an estimated notional value of $1.4 quadrillion have flooded the world market – a value of about 23 times world GDP. Not only the issuance of MBSs, but the practice of creating and selling these potentially lethal instruments, is what threatens every inhabitant of our globe.

So keep this in mind: without the repeal of Glass-Steagall and without the “compassionate conservatism” and outright socialism of our past governments, you and your friends would have reasonable job security and/or a job.

Good reasons to avoid voting for a RINO or a Democrat next year.

Hey, that ain’t hair you’re cutting. It’s our kids’ future!

by Don Hank

My mom used to give me haircuts, but she was always a little nervous and often nicked me in the ear with the scissors. That really hurt.

This haircut on the Greek bonds will hurt a LOT MORE.

Quote (see link below):

In essence, the haircut on Greek debt [haircut: partial default, in this case, decreed by law. DH] is a signal to investors that they should require a much higher rate of return on the debt of all of the PIIGS.  This is going to make the financial collapse of all of the PIIGS much more likely.

Absolutely. Not only that, the Greek government officials and Greeks benefitting from government largesse have lived high on the hog for years, and for them, that is an unalienable entitlement. Many of them get nasty when someone touches their entitlements. They burn tires, wreck vehicles, throw stones through windows, etc, breaking things they can’t afford to replace.

Now that Europe has given a 50% haircut on their sovereign debt, many will figure they can continue to live like kings and the next time around, good old Germany and the ECB and EFSF will just bail them out again, with more “haircuts” for their bonds and more leverage. Dream on. The German people are already PO’d! And with good reason.

As this author points out, the party can’t go on forever. They are tightening the noose around Europe’s neck.

“Leverage” in this context means that the banks will be able to lend 4-5 times more than before simply by issuing more credit — NOT MONEY, because they have no money at the bottom line of the balance sheets, only debt. Now even before this re-leveraging, they were leveraged to the max and already issuing loans against nothing but hot air. That’s the same as printing money, as they did in the failed Weimar Republic. Weimar failed BECAUSE they did this, but the money printing was sold as a “solution” to their problem. Now they’re trying a little — no a LOT — of hair of the dog that bit them in the butt before, except not just Germany but most of Europe. How short their memories are.

This money the banks are lending is money they don’t have. It is debt, the opposite of money. They are dealing in red numbers, paying off red numbers with more red numbers. That is like climbing higher up the mountain to reach the bottom. GUARANTEED it won’t work and when the crash comes it will be dramatic, people will get hurt and Greeks will be back burning tires again.

Maybe someone will hire them to do that. They’re getting pretty proficient at it.

by Don Hank

The site linked to below (The Economic Collapse) had predicted just a day or two ago that the “haircut” on Greek debt would increase the chances of recovery of the PIIGS. It didn’t take long for that prophecy to be realized, as they report today.

Here are my 2 cents, incl a prediction of my own. I hope it turns out to be wrong:

According to the Greek language online newspaper “Express,” the European “leaders” met with the bankers before this “haircut” edict was handed down. They had originally spoken of a 21% hiarcut, but they were faking. They knew it would be 50% but they had to soften up the bankers.

It is my humble opinion that they made these bankers a deal they couldn’t refuse. First they TOLD them the haircut would be 50%, at variance with what they had said (they had lied, to put it nicely).

According to this Greek article, the rip-off to the European banks amounted to 67.5 billion euros, or 20$ less that the Greek government would have to pay.

My prediction (I truly hope I am wrong):

The European powers (remember, this is the group that exported “democracy” the the Arabs, but they won’t give their own people democracy. THEY make all the decisions) will eventually get around to utilizing one of their many financial tentacles — e.g., the ECB, the EFSF (European Financial Stability Facility) or other, perhaps one to be created — either to BUY PIIGS bonds outright or to financially assist private buyers to buy them (using both European and US public funds — see last link below!), in order to circumvent the market. This is because no private person or entity will eventually touch a Greek bond, for ex, with a 3 meter pole, unless enticed with promises of public money.

I say this because I know:

1–the past behavior of the European elites

2–their Marxist philosophy underlying that behavior.

The real raîson d’être of the European Empire (European union) and its tentacle agencies has always been to redistribute wealth. Unlike the Soviet Union, they no longer can do that — for political reasons — openly, from one group to another. But by pretending to “stabilize” Europe, they can distribute the wealth from northern countries with a sound work ethic to southern countries with no palpable work ethic at all. [Footnote: this is analogous to the way the US government orchestrated our current financial crisis by first forcing the banks to lend to the insolvent under the infamous CRA, another wealth redistribution scheme].

By allowing the fiscally irresponsible Greece to join the Euro Zone, they knew they would ultimately be able to transfer billions of euros of wealth to that country under the pretext of “stabilization.” They won’t quit even now that they have literally destabilized the whole continent by their so-called “stabilization measures.”

They have all the power and they will continue to rob the citizens of each member country until they — and we — are dirt poor or until the people rise up and throw off their yoke.

It will be a true European Spring and the elites will not be in charge this time.

Don Hank

How the US will pay for the scam:

 http://www.youtube.com/watch?v=rPMFMxuhHAM

All of a sudden, the CRA never happened and no banks were forced to give loans to the insolvent. And no banks were induced to follow suit to make a quick buck.

Don Hank

When the banks crashed in 2008, people on the Right figured out that the CRA (Community Reinvestment Act, which forced banks to lend more money to the “underserviced communities”) had something to do with it.

A lot was said and written about the CRA and the case against it looked pretty airtight.

But then leftwing analysts issued damage control statements supposedly showing that the CRA played only a minuscule role. They argued, among other things, that the CRA was enforced only on certain large banks while others did not have to comply.

Conservative observers bought into this story without further examination, and all of a sudden, everyone was looking elsewhere for a culprit: And they found blood on the hands of the Fed, the corporations, the lobbyists, etc, all of whom certainly had played a role.

I must agree, of course, with the libertarians and even the OWS crowd that corporations and banks contributed in no small way to the crash.

And I agree with Ron Paul, Alex Jones, Steph Jasky, Karl Denninger, Bill Stills and others that the Fed, with its inflationary policies and cheap credit in the midst of a housing bubble, had a huge hand in the crash. There is a lot of political hay to be made off the anger of many in the Occupy Wall Street crowd who can see only corporate greed as the culprit. Conservatives who spell out the entire narrative, including the role of leftist government, risk losing their constituency and their followers.

So with all these individuals and groups jumping on the anti-corporate and anti-Fed bandwagon, should the CRA get off Scott free?

Amidst the lynch crowd fervor, should we really let the government off the hook?

I go on the theory that the truth is always best, even if it is bad for one’s popularity at times.

Thus, one side of the rather complex discussion has been muted, and yet, that is the message we all need to focus on right now, if for no other reason than that it is a blind spot that could cause many to think the private corporations are solely to blame, when the government was the culprit that got the ball rolling toward the housing crash and subsequent subprime crisis by enforcing horrendous wealth redistribution law that was doomed to fail from the start. After all, exonerating a truly guilty party can only induce devious characters to do more mischief.

Case in point: taking advantage of the blackout regarding the seminal causes of the crash, Barney Frank, one of the most heinous offenders in the run-up, hypocritically teamed up with Chris Dodd after the crash to write tighter banking regulations, slyly dissimulating that his own support for the CRA had contributed to the economic/financial downturn in a way that some are now calling criminal.

So let’s be honest and let the chips fall where they may. The government played a seminal role in the crash with its CRA enforcement, as aided and abetted by ACORN, even though a superficial analysis may suggest it was not that big a role. So how did this devastating law do its dirty work in the shadows?

It pulled off this feat because it was not the government forcing banks to make loans to the insolvent, which was just an initiator or catalyst. It was rather the less visible effect of the CRA’s policy allowing (force was soon no longer needed) the banks to make bad loans with the tacit guarantee that the loans would be guaranteed by government.

See, if a law forces some people to use unsound banking policies, i.e., deliberately lending to the insolvent, then it can hardly prosecute banks that do this, even if they were not the ones originally targeted by the legislation. Thus the CRA opened the flood gates for horrendous banking practices never seen before on this scale by providing a huge incentive for banks to make money hand over fist at taxpayer expense.

All of this is further compounded by the fact that neither banks nor most (if any) American corporations can be thought of as representing true free market capitalism. So for the OWS activists or anyone else to blame the crash on capitalism is like blaming saber tooth tigers for making the outdoors unsafe.

But we aren’t talking about any of this now. Somehow, the narrative of the CRA as an insignificant contributor to our woes has assumed the status of settled science.  We’ve been led down a rabbit trail by both the far left and the well-meaning right that got lost and started seeing only the role of the banks.

But you know what? This topic of government culpability is much too young to die. Let’s drag it back onto the table again and take a longer look this time.

Are corporations torch bearers of the free market?

Not even close – despite what the “conservative” media and politicians are telling you

Don Hank

There is a certain resistance among the public to admit that it is not you and I but the corporations and their lawyers, partnering with the Federal Reserve, that run America. Many conservatives hate to hear anyone “malign” corporations because to them, corporations, including banks, bear the torch of sacred capitalism. The GOP bosses are content with this situation.

On the other hand, since most big corporations donate mostly to the Democrat party, Democrats — especially those in the media and politics – are also loathe to broach the subject of corporate control over government.

Besides, the same corporations lobbying for open borders and amnesty for illegal aliens are also helping build Democrat power. Everyone knows how Latinos tend to vote.

And when it comes to “green” boondoggles, all the fat cats want in on them. They will of course mean a net loss of jobs and enormous subsidies for the most inefficient technologies known to mankind, but “green” subsidies flow freely from government coffers, as anyone following the Solyndra story knows.

Now, many of these corporate lobbyists are pushing very hard for open borders. They donated big bucks to pliable candidates and expect some bang, like more illegal alien labor, for example, and better legal conditions for sending your job overseas. Big corporations and Big Politics want precisely what you dread.

So what about us little people down here?

I wonder what people would say if they knew that the power of their vote is negligible compared to the pressures brought to bear by Big Business lobbies, which effectively dictate policy to your elected officials. I wonder how many have ever figured out that it was your senator’s and congressmen’s utter subservience to corporate lobbyists that made them vote for the TARP bailouts even after receiving phone calls begging them not to vote for it at the rate of 300 calls against the bailouts per 1 call in favor.

I wonder what will happen once the cat is out of the bag.

Maybe We the People will assume our rightful place in this great nation again.

Maybe.

But not unless we put our thinking caps on and realize what is really happening. Try asking yourself honestly: would corporations spend billions of dollars lobbying if they weren’t getting a financial “kickback” in some form or other? And are these kickbacks free or do they cost you money? 

It’s not that long between now and election time. Will your candidate discuss this with you in town meetings or will he mutter something snide, look around and say “next question”? If he isn’t leveling with you on the economy, fire him. You’re his boss and can’t afford another sluggard on your staff.

Where does your presidential candidate stand? I don’t recall the Fox moderators asking about the power of the corporate lobbies. And yet, business as usual in Washington brought down the world economy and cost millions of American jobs.

It’s time to wake up and make the economy and your job the front-burner issue this time around.

DEMAND:

CONGRESSIONAL CONTROL OF THE MONEY (NO MORE FEDERAL RESERVE)

STRICT CONTROLS ON LOBBYING, ESP CORPORATE LOBBYING

Now recall that the mainstream “conservative” media keep reminding you that the Occupy people are all a bunch of Marxists. So what about Alex Jones and Ron Paul’s followers? They aren’t Marxists and they have attended the Occupy rallies in significant numbers all over the country, teaching independents about the issues, making converts. So have people like Steph Jasky and Karl Denninger, who played a key role in founding the Tea Party, as well as a ton of other top-notch people. All while you stayed home, paralyzed with fear by what you read in the “conservative” press and blogosphere about being tainted by the lefties supposedly in charge. Like that photo of a young anarchist backed up against a police car, pants at half-mast, in an act of defiant defecation. Think anyone follows him? All in all, whatever Marxists may be participating in the rallies out in the cities and towns across the country are clueless non-contenders and will have almost no power in this movement if we play our cards right for a change. As I have said before, the movement is ours for the taking. Why do you think the Republican leaders and their minions in Big Talk Radio are all bad mouthing the movement?

Clue: Many of these people on the street are on to the lobbying games that the corporations – as well as the Fed — are playing, and threaten to spoil things for Big Politics by returning the power to you.

That is the main factor in all the negative press on the right. So why do leftwing politicians high five these young protesters? That’s easy. So far, they’ve been smarter than us. They know they can control the movement and its narrative if they act like they are behind it all. But they’re bluffing.  Yes, ACORN, Soros, Van Jones and other shadowy types with Obama links have in fact dreamed up schemes like this and undoubtedly had a hand in it, just as they no doubt had a hand in the Egyptian riots. But this isn’t Egypt now. It’s our turf, and no one can control it unless we let them. So far, the Left is spinning its wheels as its power slips away. Protesters interviewed on camera, for example, have ripped Obama mercilessly for his failures. The End the Fed movement is all over these rallies and for whatever faults they may have, they are vehemently anti-Obama and pro free market.

So if people like you can start thinking – and acting – outside the box, the whole football can be stripped from the hands of the corporatist elites and, with God’s grace, you can have your country back.

Sure, it will be hard work. And the propaganda aimed at making you think you are in bad company among the protesters will be non-stop. That’s a given.

Some of my Christian brethren are saying that to join the protests would mean being unequally yoked.

But consider this: If a bunch of atheists lobbied to make churches accountable for the actions of pedophile church workers, you wouldn’t side with the pedophiles, would you?

Voting against the pedophiles would not make you an atheist and it would not make you look like one. It would be doing God’s work because pedophiles not only harmd children, they are a stumbling block to the unsaved and give the churches a bad name. Let’s be real: For every candidate you have ever voted for, some unsavory characters also voted for him. So what?

Don’t be afraid to join forces with new people who are starting to get it and are just as mad as you, but maybe don’t have as clear a grasp of the issues. You may be the person who reaches a wishy-washy fence rider.

After all, I can’t think of a single election cycle when people on both sides of the political spectrum have been so mad for the same reasons – irrespective of their ideologies.

What a gorgeous opportunity!

If you let the political elites who stole your country steal the election this time around, don’t blame it on me.

Some statistics to consider:

http://allthingsd.com/20101223/what-tech-companies-are-spending-in-washington/

Verizon spent $3.83 million lobbying on several issues, including taxes and texting while driving, at numerous branches of the federal government, including the White House, Congress, the Internal Revenue Service and the Federal Trade Commission. It spent $2.96 million in the same period a year ago.

AT&T spent $3.47 million, up from $3.18 million a year ago. Its agenda items included legislation on calling cards, broadband buildouts and distracted driving.

Hewlett-Packard spent $1.6 million–nearly double the $970,000 it spent in the third quarter of last year–chatting with members of Congress and officials at the Department of Justice and the Commerce Department about taxes, immigration and how government agencies use technology in the areas of health care and law enforcement.

Microsoft spent $1.63 million, an increase from $1.49 million a year ago. It visited Congress, the Pentagon and the Departments of Commerce and Homeland Security to talk about computer security, how the government buys software and the competitive state of online advertising. It also lobbied the Federal Communications Commission on net neutrality.

Oracle spent $1.6 million, up from $1.3 million, lobbying Congress, the Pentagon and the Department of Homeland Security on patent litigation and the government’s technology spending plans.

Google spent $1.2 million in the third quarter (which TechCrunch noted in October following a press release by Consumer Watchdog), an increase from $1.08 million in the same period a year ago.

IBM spent $1 million, up from $850,000 a year ago, talking about transportation, the power grid, funding for research and the military, on visits to Congress and the Departments of Transportation, Defense, and Health and Human Services.

Intel spent $830,000, which is notable because the amount decreased from $1.1 million a year ago. Intel was the target of both a private antitrust lawsuit from rival Advanced Micro Devices and a government antitrust investigation by the Federal Trade Commission, both of which were intensifying in the fall. Both cases have since been settled. Its efforts were in immigration, government research funding and issues related to trademarks and education.

Yahoo spent $540,000, up from $510,000 a year ago.

Apple, easily the most influential company in consumer technology today, spent relatively little on lobbying efforts: Only $340,000 [BUT they had Al Gore on their board of directors. How cozy. 90% of their political donations went to the Democrats. Did you know that Steve Jobs “invented” mostly cosmetic changes in devices? Can you name an inventor who actually devised the really high-tech stuff like the iPod itself or the Apple computer and monitor electronics? Didn’t think so. They didn’t have dinner with Al Gore—Don Hank].

Facebook spent $120,000.

For a little more on what companies spend on lobbying efforts in Washington, it’s always enlightening to peruse the database maintained by the Center for Responsive Politics, which tracks not only lobbying expenditures but campaign contributions.

As you can see, the CRP shows that, among computer and Internet companies, Microsoft was the leading lobbying spender for the first nine months of the year. The wireless industry’s trade association, the CTIA, led the pack in the telephone equipment and services category, spending more than $6 million. Meanwhile, Verizon and AT&T each spent more than $12 million.

http://www.alternet.org/story/146643/hightower:_washington_overrun_by_11,000_corporate_lobbyists_and_$500_million_in_corrupting_donations

• 11,195. That’s the number of corporate lobbyists who are presently plying their nefarious trade day and night in Washington’s hallways and back rooms.
• $2.95 billion. That’s the amount that corporations spent on lobbyists last year alone (a sum more than six times greater than the total spent by all consumer,environmental, worker, and other non-corporate groups combined).
• $473 million. That’s the sum of money that corporate executives and lobbyists have slipped into Washington’s many political pockets–so far–for the 2010 election cycle, including donations to candidates, leadership PACS, and party committees. We are still seven months from the 2010 elections, and already corporate spending has reached the record-breaking total of $475 million shelled out for the entire 2008 cycle.