If you've been "vocal" about how bad this "economic recovery" has been, then you get Greece.
People are now getting killed in violent protests that we will soon see here in the United States if something is not done soon.
We have manipulated accounting rules to "extend and pretend" mortgages, alter bank earnings and increase debt and more debt. We have seen a stock market "recovery" to above 11,000 in an unprecedented manner with price/earnings so out-of-whack--believe me--it is not even funny. Yesterday, they dipped by 1,000 in a moment. And, we've seen Government Sachs funneled money to manipulate markets.
Here's just another example from "Zero Hedge" on Congress bought by Wall Street.
http://www.zerohedge.com/article/senate-rejects-brown-kaufman-proposal-break-largest-banks
We've seen Ben Bernanke et al. put $1.25 trillion into Fannie/Freddie MBS...putting the U.S. even more into debt...without any transparency...and still...here we are...two hours before the Labor Department releases an unemployment number that may be staggering...or...did someone find out what it was yesterday? What will it be that bad?
It will still be nearly 17 percent from a U-6 perspective--maybe more like 20 percent. People are hurting, real people are in pain....and we can no longer avoid it.
Greece is the word...and it's spreading to Portugal, Spain, Ireland and Italy. The EU bailout, still not enough for Greece, siphens even more money from stronger European nations, including Germany, France and, of course, the United Kingdom.
And, the U.S. is just like Greece. In Iran, Afghanistan, China--they watch it unfold. An economic World War we are losing. When the smoke clears, we may not like what we see.
Call it "doom and gloom" but "extend and pretend" is and was a mistake. In a deflationary spiral, a proper revaluation needs to occur. It is a correction that includes immediate pain but eventual gain in the end to prosper future generations--not at fault for this fiasco.
Who's to blame for this crisis? Ronald Reagan, George H.W. Bush, Bill Clinton (who said on ABC he should not have listened to Larry Summers), George W. Bush and, yes, Barack Obama who kept Reagan Democrats in his oval office to help "fix" this financial crisis.
Obama can change that right now and begin to deliver on some of his campaign promises.
He needs to get Elizabeth Warren, Paul Volcker, Nouriel Roubini and people who care more for common good than political prestige and a Wall Street party. Wall Street's demise is the U.S. demise, but it doesn't have to be that way.
IF the tipping point has not already occurred, there may be time to stop it.
My economics mentor sent this email to me yesterday:
Robert,
Remember what I mentioned to you about the ‘Crash of 1932’? Should we feel good about being able to say, "I told you so"?
whereas, I replied:
I know. They're "congratulating" me here in the office.
This is Great Depression II, and the optimists from pre-September 2008 are the same ones with mouths hanging open yesterday. What? How can this be happening?
Martin Weiss said trillions and trillions of dollars in debt need to be recovered. Even a fraction of that amount unrecovered means insolvency.
Are you beginning to get the picture that banks are, indeed, insolvent? That the U.S. Government propped them up, saved them, so that an extreme wealth gap persists in this Nation? Money, as they say, is the root of all evils. Just look at the evil manifesting itself from Greece, and its globle tie-in to other countries, including the United States.
And, unlike Great Depression I, this is truly global. Our shrinking world via Internet technology, speed of communication and an our persistent outsourcing has left the U.S. vulnerable for economic disaster of which we have no controls.
However, extreme problems call for extreme solutions. My opinion is that the future will hold and East-West currency and a realignment of economic goals in the best interests of Western democracies. This new currency may help allieve economic tensions and, indeed, revalue assets in the U.S. Fact is, increasing capital reserves on deposit assets--something the U.S. Senate voted 98-0 to do, only keeps credit constrained.
Without credit, there will be no recovery.
It is time, as Steely Dan's "Kid Charlamagne" says, to "cross a diamond with a pearl, turn it on the world and turn the world around." Get along.
And, as for the "squeaky wheels" who get Greece, I will post a few of the best blog sites I have been reading in the past couple of years that absolutely forecast this disaster. That's how I found out about it and educated myself to the problems of this world.
http://globaleconomicanalysis.blogspot.com/
http://market-ticker.denninger.net/
http://www.zerohedge.com/
These bloggers, much smarter than I, are also educators if you motivate yourself to learn the financial truths.
And then we, the American people, can all begin to understand Greece and the potential that the U.S. has of looking just like it down the road.
Stay tuned.
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