Tag Archives: bailout plan

From turmoil to manipulation to control

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TURMOIL, FEAR, CRISIS, PANIC, COLLAPSE, SAVING THE ECONOMY, BAILOUT, CONTROL… Notice the progression from left to right.  A few bumps in the road lead to an eventual bailout with control obtained due to matters rushed in a state of panic.  Do people act rationally when they are paniced?  NO  Generally, they look for a solution.  Someone to come along and say “follow me”  I know the way!  This is exactly what is happening with the proposed bailout plan that is thankfully hitting a few speed bumps.  However, Bernake, Paulson, and the Bush administration want to see it passed immediately.

Bloomberg article:    (Emphasis in bold mine)

“I believe if the credit markets are not functioning, that jobs will be lost, the unemployment rate will rise, more houses will be foreclosed upon, GDP will contract, that the economy will just not be able to recover,” Bernanke told the Senate Banking Committee today. “My interest is solely for the strength and recovery of the U.S. economy.”

Lawmakers have balked at rubber-stamping the Treasury plan to remove illiquid assets from the banking system, with Democrats demanding it support homeowners and limit executive pay, and Republicans resisting the plan’s reach and size.

Bernanke, putting aside his prepared remarks released earlier today, said the Treasury should buy illiquid assets at “hold-to-maturity” values rather than at discounted “fire- sale” prices. The suspension of “mark-to-market” accounting for assets, a change backed by “many banks,” would instead hurt investor confidence.

Let’s get this straight… Markets in turmoil, unknown amount of worthless assets, the banks don’t want to write them off because it will show up on their books, they will need more cash on hand once the bad debt is written off, which they don’t have, Bernake and Paulson want to push this though ASAP, Bernake and Paulson want to pay the HTM (Held to Maturity cost), and not a discounted price.  That is essentially paying for a salvaged car at the price it cost when new and in the showroom.  THIS IS NOT GOOD

HTM securities are those the investor intends to hold to maturity and is able to hold to maturity. Designation of a security as HTM allows the investor to report the security value at historical cost plus accretion or minus amortization. Unrealized gains or losses are not shown on the balance sheet, reflected in reported income, or reflected in reported net worth. 

What I want to know is what we aren’t seeing.  We have a bill trying to be pushed though Congress at a very rapid pace.  Lawmakers are being asked to assume at a minimum $700 billion worth of debt obligations that nobody knows the value of.  No bank in the world or private institution would consider doing such a thing.  However, the rules change when you say that it is in the taxpayer’s best interest in “saving” the economy, but behind the taxpayer’s back you are reaching into their pocket and pulling out hard earned cash.

Losing our freedoms…

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Whenever there is panic and fear, which are growing rapidly day by day there is generally an accompanied amount of control and restriction by the state (the government).  Everyone’s focus at the moment is on the stock market and the bailout plan.  However, behind the scenes events are unraveling that once again as they have ever increasingly since September 11, 2001 are limiting and curtailing our freedoms.  We fought hard for these and to have them taken away as a byproduct of events that could have been avoided… 

During times of unrest and ill ease it is imperative that we stand by the constitution and not let it go by the wayside.  We expect the state to intervene and save us versus take care of ourselves.  The founders of this country who risked their lives to have freedom would be disgusted at how we roll over these days. 

Our borders are becoming increasingly difficult to cross with more information required.  Ellen Nakashima of the Washington Post wrote an interesting article about the extended search capabilities of the border guards…

The U.S. government has quietly recast policies that affect the way information is gathered from U.S. citizens and others crossing the border and what is done with it, including relaxing a two-decade-old policy that placed a high bar on federal agents copying travelers’ personal material, according to newly released documents.

The policy changes, civil liberties advocates say, also raise concerns about the guidelines under which border officers may share data copied from laptop computers and cellphones with other agencies and the types of questions they are allowed to ask American citizens.

The article continues 

But what DHS did not disclose was that since 1986 and until last year, the government generally required a higher standard: Federal agents needed probable cause that a law was being broken before they could copy material a traveler was bringing into the country.

If you or I go through the United States border we may be detained, our personal documents photocopied, our cell phones held onto, our computers searched, and the list goes on.  Previously, a customs agent would have to obtain permission from the courts or have a probable cause to commit such acts.  No longer is that necessary.  The rest of the article cites specific instances where people have been detained for 5.5 hours, been asked about their religious beliefs, who people in their cell phones are, and so one.  

Every time I travel internationally I dread going through United States customs.  I would rather go through customs in India, China, Egypt or any other country for that matter than the US (there are a few exceptions).  Prior to September 11, 2001 this wasn’t as big an issue.  However, these days you are automatically assumed to be somewhat guilty, and questioned as such.  As a foreigner I can’t imagine what customs is like.  

Once I was returning to the United States from Europe.  There are many stamps and visas in my passport as I have traveled all over the world.  The customs agent started to go through my passport page by page asking me about every country I had a stamp for.  The stamps were a couple years old and had no relevance to my present trip so I was becoming quite annoyed.  Finally I asked him if he had ever been to India and if not that he had to go because it is such an amazing country.  The people are friendly, the food is amazing, and so on.  He replied that he doesn’t travel outside the United States.  A border agent that doesn’t travel outside the United States seems quite ironic.

State powers seem to be growing within the United States as well.  Prior to the Republican National Convention there was a mass arrest in St. Paul Minnesota.  


 

The Glass Bead Collective released video on Thursday of the mass arrests of protesters, media and bystanders at Shepard Road on day one of the Republican National Convention. A number of those arrested were heading to or from the SEIU Labor Day concert on Harriet Island. (Three members of the Glass Bead Collective were among those arrested in the week before the RNC in St. Paul.)

The Glass Bead Collective said the video came from a cameraman who hid his video before being arrested. From the press release, “Video released today shows the indiscriminate arrest of a crowd of two hundred at the waterfront across from a concert on Harriet Island Regional Park during this month’s Republican National Convention in St. Paul. The video includes multiple angles of the event as well as an interview with the cameraman who buried his footage and was one of almost two hundred people arrested for rioting without probable cause.”