Curried Wealth Building
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November 30, 2008
Issue 22  -  Unending Bailout

To anyone reading this that still thinks the "rescue" package passed by CONgress was for helping the common working stiff I present the following chart from SFGate.com:

 
 

Now maybe I’m wrong but I thought the bailout was for $700 billion with an extra $150 billion for various pork projects that were used to twist arms of those that could still be bought. So now the total stands at 8.5 trillion !!!!! This is more than half of the GDP for the United States. This is nearly enough to PAY OFF every mortgage in the United States which now totals about 10.6 trillion.  This was never about anything but saving the butts of the ruling elites who truly call the shots in this country.  Now read this story form Bloomberg:

"Fed Pledges Top $7.4 Trillion to Ease Frozen Credit

Nov. 24 (Bloomberg) -- The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago.

The unprecedented pledge of funds includes $2.8 trillion already tapped by financial institutions in the biggest response to an economic emergency since the New Deal of the 1930s, according to data compiled by Bloomberg. The commitment dwarfs the only plan approved by lawmakers, the Treasury Department's $700 billion Troubled Asset Relief Program. Federal Reserve lendinglast week was 1,900 times the weekly average for the three years before the crisis… "

This article was written on Monday while the graphic was published on Thursday. So in three days the number grew by over a trillion dollars? Either that or there are a lot of shady dealings being done. I vote for the latter. We are now in a downward spiral that can’t be stopped. The only thing that can slow the descent is more and more phony baloney "dollars". Why stop at 8 trillion, let’s go for 10, no make that 20, it’s only a keystroke on the computer. It’s not like they really exist anywhere or are backed by anything. This giant Ponzi scheme is going to end in the next twelve months in tears. Tears of the American people, who were lied to about "investing for the long run" and "stocks always go up", or real estate is the best investment because they "aren’t making any more land". And the entire problem goes back to fiat money. Money that is imaginary. Money not backed or exchangeable for ANYTHING. When faith in this farce vanishes, and it will, dollar holders will left holding the bag.

Now this:

"US government to invest $20B in Citigroup, back $306B loan pool -- WSJ (3.77)
The newspaper reports The federal government agreed to absorb potentially hundreds of billions of dollars in losses on toxic assets on Citigroup's balance sheet and injecting fresh capital into the bank. Under the plan, the WSJ reports Citigroup and the government have identified a pool of about $306B in troubled assets: Citigroup will absorb the first $29B in losses in that portfolio. After that, three government agencies -- the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp. -- will take on any additional losses, though Citigroup could have to share a small portion of additional losses the newspaper adds. In exchange for that protection, Citigroup will give the government warrants to buy shares in the company according to the newspaper. In addition, the Treasury Department also will inject $20B of fresh capital into Citigroup. That comes on top of the $25B infusion that Citigroup recently received as part of the the broader U.S. banking-industry bailout. According to the newspaper, The government didn't require Citigroup to make changes to its executive ranks or its board in return for government assistance. However, Citigroup agreed to "comply with enhanced executive compensation restrictions," the government said Sunday, and also will implement a government-backed plan to modify distressed mortgages that is designed to curb foreclosures. - SA London"

Maybe I blinked, but when did CONgress grant the legal right to just keep loaning and buying and "investing" in damaged goods that will never return a dime? They didn’t, which means we are getting the shaft. They aren’t even trying to hide what they are doing. Notice the blatant use of the word "toxic" when describing the assets being purchased. Toxic is a euphemism for worthless. If they had value, they would be sold to someone in the open market. But they aren’t being sold in the open market, because they are WORTHLESS! We are throwing our kids future earning power down the shoots to save CROOKS on Wall Street. Crooks who CAUSED the problem in the first place.  So giving more money to the guys who caused the problem will now solve it?  Not bloody likely.  They win and we lose.

Now the "savior" Obama is talking about another stimulus plan:

"Obama putting together $500B stimulus plan; Paulson considers tapping second half of TARP - WSJ
Citing Obama's aides and advisers, the WSJ reports that Obama's team is putting together a new economic stimulus plan containing more than $500B in federal spending and tax cuts over the next two years. An earlier WSJ report (18:34 comment) had indicated the Obama plan would total $300-500B, well beyond the $175B plan mentioned in his campaign. House Majority leader Steny Hoyer said the new Congress will have a stimulus package completed during the first couple weeks of January, and ready for Obama's signature after inauguration. The WSJ also reports that Treasury Secretary Paulson is now considering a more activist stance in his final weeks in office, and is considering tapping the second half of the government's $700B TARP. Paulson's immediate focus has been on a previously discussed plan to revive the market for securitization of auto loans, student loans and credit cards. The Treasury and Fed have agreed on a structure for a program and are working on details that could be announced within weeks."

Well I’m sorry to tell you that Mr. Obama has no chance of fixing this mess because the ball is already rolling down the hill. There are no mulligans, do overs, or restart buttons. We are in the trap and the mechanism is streaking towards the necks of the average American. We have no chance to save the masses, that chance was thrown away in 2000 when Greenspan lowered interest rates to 1%. So Obama thinks that handing out more checks will solve this? Where does this new money come from?

In fact the advisors Obama is choosing are whispering this type of drivel in his ear:

"CBS: NYT's Paul Krugman Warns Against
Economic Prudence, Caution

On Monday's CBS Early Show, co-host Maggie Rodriguez asked liberal economist and New York Times columnist Paul Krugman about Barack Obama's proposed stimulus package: "What about the $500 billion economic stimulus plan that President-elect Obama is planning? Do you think it's realistic to get that done in two years?" Not only was Krugman in favor of the plan, but he argued: "I'm actually worried that this plan may be too small... I'm still worrying that they're going to be a little bit short, because you just have to put all your notions of what is prudent aside. Being cautious is actually a very foolish thing right now."

Rodriguez's discussion with Krugman was preceded by a fawning report by correspondent Dean Reynolds on Obama's economic plan: "Well, the incoming administration is making it abundantly clear that it plans an active multi-billion dollar approach to kick-starting the economy. As one top economic adviser to Barack Obama put it, the era of dithering is over." Reynolds continued by declaring: "...with the actions taken so far to stem the tide proving to be totally ineffective, the incoming administration is setting the table for a long struggle to make things right."


Wow, what a bunch of idiots. 8.5 trillion dollars is dithering???????!?? What are these guys smoking? Obama is going to make Bush look like a spendthrift, and he increased the national debt by more in 8 years than the TOTAL debt accumulated in the previous 200 years. Obama is being told to spend spend spend, that will solve it. Well, it won’t. It will only make it worse and worse. More money and credit will not fix this. What to do?

First read this:

"Mint suspends orders amid rush to buy bullion

Sarah-Jane Tasker | November 22, 2008

Article from: The Australian

FEARS of the unknown long-term effects from the global financial crisis have sparked a new gold rush.

With retail and wholesale clients around the world stocking up on the precious metal, the Perth Mint has been forced to suspend orders.

As the World Gold Council reported that the dollar demand for gold reached a quarterly record of $US32 billion ($50.73 billion) in the third quarter, industry insiders said the race to secure physical gold had reached an intensity that had never been witnessed before.

Perth Mint sales and marketing director Ron Currie said the unprecedented demand had forced the Mint to cease orders until January, with staff working seven days a week, 24-hour days, over three shifts to meet orders.

He said Europe was leading the demand, with Russia, Ukraine, Middle East and US all buying -- making up 80 per cent of its sales. One European client purchased 30,000 ounces for $33 million.

"We have never seen this before and are working right at capacity. And we are seeing it from clients in the shop buying one ounce, right up to 30,000 ounces from overseas clients," Mr Currie said. "

Remember that gold prices are actually down from a year ago yet the demand is sky rocketing. The jig is about up for the gold cartel and their price rigging scheme. I expect gold to increase tremendously in the coming year.  It is just about the safest investment that you could ever come up with and today is day to make your decision to get some.  Call now.  Don't wait, time is very short.  The stock market is not going to save you.  Your house is not going to save you.  Bonds are not going to save you.  The only thing that can is gold and silver.  Look the largest mint in Australia is NOT taking orders for their MAIN product.  Have you EVER heard of a company that stopped taking orders for their main product?  Neither have I, which tells you all you need to know about where the price is going.  Make the decision today.  Get some metal.  Call if you need help.  703-791-6066.