February 28, 2009

The Financial Crisis is Exposing the US Elite

We don't usually turn our attention to that small number of very wealthy Americans who constitute our modern-day aristocracy... probably because we've been beaten down by admonishments for threatening class warefare. Well, the war is on.

The economic crisis is dumping an uncomfortable question on our collective laps: Who is going to take the losses? That question will pit classes against each other. A related topic is whether we can overcome the banking power structure to inact solutions to the financial industry crisis that will further weaken the banking families' power. This subject is a feature of Episode 7 of GDAE Podcast.

Psssst... Do Something

February 27, 2009

War Slave

Click on the image and look more closely.

Sources: Art by Myztico


February 25, 2009

Demand Drastic Change of the Banking System

Economic literacy is important. For that reason, I maintain a list of Business/Econ web sites in the column to the right. Today I've added a new one, Baseline Scenario. It was co-founded by economist Simon Johnson. Simon Johnson, professor of global economics and management at MIT's Sloan School of Management. He is the former chief economist of the International Monetary Fund.

We have Bill Moyers to thank for guiding me to the Baseline Scenario site. Simon Johnson appeared in a segment on Bill Moyer's Journal, February 13, 2009. Here's a highlight:

Johnson explains ... that the U.S. financial system reminds him more of the embattled emerging markets he encountered in his time with the International Monetary Fund than that of a developed nation. As such, Johnson believes that the U.S. financial system needs a "reboot," breaking up the biggest banks, in some cases firing management and wiping out shareholder value."

It Continues...

Without drastic action, Johnson argues, taxpayers are merely subsidizing a wealthy powerful industry without forcing necessary systemic changes: "Taxpayer money is ensuring their bonuses. We're making sure that banks survive. And eventually, of course, the economy will turn around. Things will get better. The banks will be worth a lot of money. And they will cash out. And we will be paying higher taxes, we and our children, will be paying higher taxes so those people could have those bonuses. That's not fair. It's not acceptable. It's not even good economics."

This will be a topic of GDAE Podcast, Episode 7. You might also want to see the Simon Johnson interview with Bill Moyers [Video], or read the transcript. If you're moved, then ... Do Something. Make your voice heard.


February 24, 2009

Citigroup Should be Enslaved to the Taxpayer

I can't resist saying, again, that former Clinton Treasury Secretary Robert Rubin has egg on his face. Get angry and channel that anger:

Citigroup has been involved in talks with regulators over ways the government could help strengthen the bank, including use of the stock conversion plan. New York-based Citigroup already has received $45 billion in bailout money, plus guarantees to cover losses on hundreds of billions of dollars in risky investments.

Also remember that Clinton, and his Treasury Secretary Robert Rubin (Mr. Citigroup brain), played right along with the deregulation mania. This included supporting the Gramm-Leach-Bliley Financial Services Modernization Act of 1999, which finalized the undoing of the 1930s era Glass-Stegall Act. Glass-Stegall was designed after the 1929 Crash to insulate commercial banks, that make traditional loans for small businesses and individuals, from the risks of speculative financial institutions by requiring them to be separate companies.

The Clinton-Rubin team also gave us the "and for signing the Commodity Futures Modernization Act, which exempted from federal regulation all derivatives, including the now notorious credit-default swaps."[1]

Psssst... Do Something

DemocracyNow! Headlines, Clinton Says Don’t Blame Him for the Economic Crisis, February 17, 2009.


February 18, 2009

Blog Against Thocracy: April 10-12

Here's your chance to help a good idea go viral. If you have a blog, you can help spread the notice Blue Gal has posted.


February 17, 2009

GDAE Podcast Episode 6

Episode 6 - February 17, 2009
  • How the wireless cell phone companies overcharge for our text messages.
  • Music from the front porch, Guitar and Harmonica.
  • Art meets Music with Baltimore's High Zero Music Festival.
  • Political farce with Dick Army and Phil Gingrey..
  • Prosecution of Bush: Voices of Truth Seekers Podcast host Dani, Obermann and Obama.
  • How the economic stimulus initiative relates to financial system bailout and where our voices fit in.
GO TO GDAE Podcast


February 15, 2009

Two Pieces of the Econmic Puzzle

It's easy for the current economic issues to become a blur. Economist James Galbraith recently brought some order to the issues by highlighting the distinction between the economic stimulus legislative package and the financial system bailout package. During a recent interview on DemocracyNow! with Amy Goodman Galbraith explained they are distinct, but mutually supporting pieces of the economic puzzle.

AMY GOODMAN: Professor Galbraith, do you think the stimulus package is large enough?

JAMES GALBRAITH: The stimulus package is a very good bill, and it should pass. It will not, by itself, deal with the economic crisis that we’re in. I think we should be very clear about that... A major problem that we face is that the stimulus package is sized so that it will work only if the revival of credit, which is part of the plan that the Treasury is announcing today (2/10/09), also works.... I think it’s very important to understand that this spending package is really geared to the success of this other piece, and this other piece is much more problematic than the spending package is.

Treasury Secretary Timothy F. Geithner is taking the lead on the second piece, propping up the financial institutions and getting the main street credit system working. This second piece, in theory, addresses freeing up the loans necessary for small businesses to have liquid cash to buy inputs to their products, to make payroll, for students to get loans, for creditworthy people to get car loans all of which are part of making the economic engine run.

Geithner's press event last Tuesday on the plan to stabilize the financial system was blasted as being too vague... Team Obamaa probably should have saved Geithner's announcement for after last weekend's G7 meeting in Rome, because Geithner was unable to provide details before he worked out some international details.

The financial system problem in a nutshell: Most, if not all, of the dozen or so biggest banks have bad debt on their books, probably making some of the banks insolvent. The banks won't make loans to each other, because they don't trust each other to pay back the loans. So what does Geithner's plan offer as general approaches?

In one case, government guarantees would be provided to protect a bank from future losses caused by the toxic assets. In another case, the government would buy the assets outright from a bank. [2]

Either way, "government" = "tax payer."

As expanded on in the upcoming Episode 6 of the GDAE Podcast, the bottom line is that government accountants must have access to the bank's books. That's happening to some degree already, but needs to be done in a comprehensive and systematic way... sooner than later. It's also best to have international coordination when examining the books, because a lot of bad news is hiding on those books and the negative fallout has international implications:

This need for coordination is more than just rhetoric, officials said. If the United States develops a method to examine the books of banks and evaluate the real worth of their assets, it would likely affect financial firms around the world. Other countries would have to consider similar actions.[2]

We all need to raise our voices and urge Team Obama to direct sufficient resources to the FDIC to send their examiners into the banks to look a the books. The longer they delay, the more we pay.

Psssst... Do Something


1. DemocracyNow!, Economist James Galbraith: Bailed-Out Banks Should Be Declared Insolvent, February 10, 2009.

2. Washington Post, Geithner Takes Plan To Global Leaders
Secretary Reassures Counterparts About U.S. Rescue Strategy, February 15, 2009.


February 14, 2009

Happy Valentine's Day

Graphic Credits:

Valentine eye by phlezk

Her Valentine Dragon by Zilla

Steampunk Valentine by rsandberg

Valtentine box held by depart

Valentine on hip by li bra


February 13, 2009

Thoughts at end of Quiet Week

My blog has been silent this week. But here are my thoughts....

The Godless Liberal Homo blog has continued to provide convenient ways for us to raise our voices in unity. One topic on which I raised my voice was to support Rep. John Conyers' single payer healthcare bill, medicare for all is what it should be called.... H.R. 676. Plenty of time to Contact your Rep in the House of Representatives.

I continue, and will continue, to raise my voice, and urge others to raise theirs, via the GDAE Podcast. You can listen to it directly on your computer by going to the previously highlighted link. You can also subscribe using the links in the right hand column of this page.

The issue of "subscribing" to a podcast is also on my mind, because many people are still just learning How to Subscribe to a Podcast. The "how to" link includes links to "iTunes" & "Juice" podcatching software, both available for free, both work on macs and PCs. BUT, if you use "My Yahoo" or similar pages tailored to feed you particular news, sports, entertainment or other information, you're already "subscribing" when you "Add Content." Click on "Add RSS Feed" and past in the URL I've provided just below. You can then listen to the podcast right from your "My Yahoo" page without downloading anything.

Back to using Juice, or iTunes.... The "how to" refers to podcast RSS feeds. Here's mine:

If you have iTunes or similar software, an easy way for you to subscribe now is to click on the "Subscribe..." button over there to the right.

To give you some comfort, the "how to" instructions say the podcasts are "automatically downloaded to your computer." You have the option of NOT having the podcatcher automatically download podcasts... I've got mine set so I'm in control... I click "refresh" to download the newest episodes of my favorite podcasts .... It's not a big deal... you can always delete podcasts you no longer want on your computer. Tho if you're using an old modem for your internet access, which takes a long time to download things, it might be time to think about upgrading.

I could certainly go on with my thoughts for the week, but will leave it there.


February 12, 2009

Bethany McLean: Role Model

Here's a good role model for girls and young women. Bethaney McLean, 34, exposed the Enron scandal as a writer for Fortune magazine. She's now a contributing editor at Vanity Fair and gets invited to be on the Daily Show with John Stewart and PBS NOW with David Brancaccio just to name a couple.

Co-author of "The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron," McLean was about 25 in March 2001 when her article in Fortune titled, "Is Enron Overpriced?," was the first in a national publication to openly question the company's dealings. The book was eventually turned into a video documentary.

Here's a short video of Bethany McLean on the Daily Show:


February 11, 2009

RNC Chair Michael Steele's Voice "unimportant"

Michael Steele, former Lt. Governor of Maryland and newly appointed chair of the Republican National Committee, has egg on his face. In discussing Obama's stimulus package on Democracy Now, James Galbraith, economist and professor of public affairs and government at the University of Texas, dismisses the wacky verbiage of Michael Steele.

AMY GOODMAN: Professor Galbraith, what do you make of the new RNC chair, Michael Steele, saying these aren’t jobs, they’re simply work?

JAMES GALBRAITH: Well, it’s interesting that this semantic philosopher has taken over the Republican National Committee. It’s going to lead to some exceptionally—historians will have fun with the logic chopping and sentence parsing that we’re going to get from Mr. Steele, obviously, during his tenure. But otherwise, it’s unimportant.

Steele supposedly coined the slogan "drill baby drill." It's said that when a political party is initially discredited, like the Republican Party is today, most of the moderate members run for cover. This leaves a vacuum for the fringe elements, like Michael Steele and Sarah Palin, to take center stage. As media studies professor Susan Douglass recently said about Sarah Palin, following her is like watching a train wreck over and over, which can be entertaining if you enjoy the surreal.


Democracy Now, Economist James Galbraith: Bailed-Out Banks Should Be Declared Insolvent, February 10, 2009.


February 7, 2009

GDAE Podcast - Episode 5

Episode 5 - February 6, 2009
  • Rickback Bookbock on Accountability.  A tie-in to peanut butter and milk.
  • Prosecuting Bush officials for Torture:  An interview with law professor and National Lawyers Guild President Margarie Cohn.
  • MUSIC:  "Vat of Chocolate" and "You're American (video)" the later by Brian Fox.
  • Listener Feedback:  Corporate media coverage of Israeli assault on Gaza and a few suggestions.
  • An exchange with the crew from the WakeUp AM Podcast from Portsmouth New Hampshire.


February 4, 2009

Looking Backwards: A Prerequisite to Looking Forward

I've been away from the blogging world a bit here. Been thinking about accountability lately, 'cuz it's a feature of the upcoming GDAE Podcast... the 5th episode should be finished in a couple days.

One concept I'm pushing relates to Obama's desire to "Look Forward," which has become his and Joe Biden's montra in the context of whether their administration will hold criminal actors of the Bush administration accountable. The concept is, if we want to look forward to living in a nation of laws, we need to enforce those laws. That means holding people, like David Addington, John Yoo, Condoleezza Rice and George Bush accountable for their actions.... actions that happen to have occurred in the past.

So, help me advance this concept that, sometimes, looking backwards is a prerequisite setting things right for the future.

Psssst... Do Something