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LWW
09-25-2010, 11:36 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><u><span style='font-size: 17pt'>Obama Stimulus Made Economic Crisis Worse, `Black Swan' Author Taleb Says</span></u>
By Frederic Tomesco - Sep 25, 2010 10:36 AM ET

U.S. President Barack Obama and his administration weakened the country’s economy by seeking to foster growth instead of paying down the federal debt, said Nassim Nicholas Taleb, author of “The Black Swan.”

“Obama did exactly the opposite of what should have been done,” Taleb said yesterday in Montreal in a speech as part of Canada’s Salon Speakers series. “He surrounded himself with people who exacerbated the problem. You have a person who has cancer and instead of removing the cancer, you give him tranquilizers. When you give tranquilizers to a cancer patient, they feel better but the cancer gets worse.”

Today, Taleb said, <span style='font-size: 11pt'>“total debt is higher than it was in 2008 and unemployment is worse.”</span> ...

Governments globally need to cut debt and avoid bailing out struggling companies because that’s the only way they can shield their economies from the negative consequences of erroneous budget forecasts, Taleb said.

Errant Forecasts

“Today there is a dependency on people who have never been able to forecast anything,” Taleb said. “What kind of system is insulated from forecasting errors? A system where debts are low and companies are allowed to die young when they are fragile. Companies always end up dying one day anyway.” ...

Canada has the lowest ratio of net debt to gross domestic product among the Group of Seven industrialized countries and will keep that distinction until at least 2014, the country’s finance department said in March. Canada’s ratio, 24 percent in 2007, will rise to about 30 percent by 2014. The U.S. ratio, now above 40 percent, will top 80 percent in four years, the department said, citing IMF data.

“I am bullish on Canada,” he told the audience. “I prefer Canada to the U.S. or even Europe.” ...</div></div>

Whether or not the goal was the destruction of our free market system, it is becoming the end result. (http://www.bloomberg.com/news/2010-09-25/-black-swan-author-taleb-says-obama-s-stimulus-made-economic-crisis-worse.html)

LWW

LWW
09-25-2010, 11:40 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><u><span style='font-size: 17pt'>Regulators shut banks in Florida, Washington state</span></u>
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Sep 24, 10:59 PM (ET)

By MARCY GORDON

WASHINGTON (AP) - Regulators on Friday shut down small banks in Florida and Washington state, bringing to 127 the number of U.S. bank failures this year on a wave of loan defaults and economic distress.

The Federal Deposit Insurance Corp. took over Haven Trust Bank Florida of Ponte Vedra Beach, Fla., with $148.6 million in assets and $133.6 million in deposits, and North County Bank, based in Arlington, Wash., with $288.8 million in assets and $276.1 million in deposits. ...

With 127 closures nationwide so far this year, the pace of bank failures exceeds that of 2009, which was already a brisk year for shutdowns. By this time last year, regulators had closed 95 banks.

The pace has accelerated as banks' losses mount on loans made for commercial property and development. Many companies have shut down in the recession, vacating shopping malls and office buildings financed by the loans. That has brought delinquent loan payments and defaults by commercial developers.

The number of bank failures is expected to peak this year and be slightly higher than the 140 that fell in 2009. ...

The number of banks on the FDIC's confidential "problem" list jumped to 829 in the second quarter from 775 three months earlier, even as the industry as a whole had its best quarter since 2007, making $21.6 billion in net income. Banks with more than $10 billion in assets - only 1.3 percent of the industry - accounted for $19.9 billion of the total earnings.

The FDIC expects the cost of resolving failed banks to total around $60 billion from 2010 through 2014.
The agency mandated last year that banks prepay about $45 billion in premiums, for 2010 through 2012, to replenish the insurance fund.

Depositors' money - insured up to $250,000 per account - is not at risk, with the FDIC backed by the government. That insurance cap was made permanent in the financial overhaul law enacted in July. </div></div>

The takeover of the financial industry continues! (http://apnews.myway.com/article/20100925/D9IEMB381.html)

LWW

LWW
09-25-2010, 11:47 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"><u><span style='font-size: 17pt'>Credit Unions Bailed Out U.S. Backs $30 Billion in Bonds to Stabilize Key Institutions; Subprime Legacy</span></u>
Article

By MARK MAREMONT And VICTORIA MCGRANE

Two years after the peak of the financial crisis, the federal government swooped in to stabilize a crucial part of the credit-union sector battered by losses on subprime mortgages.

Regulators announced Friday a rescue and revamping of the nation's wholesale credit union system, underpinned by a federal guarantee valued at $30 billion or more. Wholesale credit unions don't deal with the general public but provide essential back-office services to thousands of other credit unions across the U.S. The majority of retail credit unions are sound, but they will have to shoulder the losses through special assessments over the next decade.

Friday's moves include the seizure of three wholesale credit unions, plus an unusual plan by government officials to manage $50 billion of troubled assets inherited from failed institutions. To help fund the rescue, the National Credit Union Administration plans to issue $30 billion to $35 billion in government-guaranteed bonds, backed by the shaky mortgage-related assets.

Officials said the plan won't cost taxpayers any money. Still, it marks the latest intervention by the U.S. government into a financial system weakened by the real-estate bust. Bad bets on mortgage-backed securities have now killed five of the nation's 27 wholesale credit unions since March 2009. The federal government, <span style='font-size: 14pt'>which now controls about 70% of the total assets at such credit unions</span>, said the surviving institutions will be reined in so that they take fewer risks with their investments. ...

In an effort to minimize and spread out losses that must be absorbed by the credit-union industry, regulators said they will move all the battered securities into a good bank-bad bank structure. NCUA officials will manage the $50 billion portfolio, or "bad bank," of the failed wholesale institutions.

<span style='font-size: 11pt'>Federal regulators will allow the remaining "good bank" operations at the credit unions to continue for about two years while retail credit unions wind down their relationships with the failed institutions.</span>

Friday's moves could deepen tensions between regulators and retail credit unions that withstood the financial crisis and resent having to bear financial costs caused by the mistakes of wholesale institutions.</div></div>

NONE SHALL BE SPARED! (http://online.wsj.com/article/SB10001424052748703499604575512254063682236.html?m od=WSJ_hpp_LEFTWhatsNewsCollection)

LWW

jimmyg
09-25-2010, 12:36 PM
This "looting" will pale the S&L crisis.

By the way, the same parties that created and caused the S&L crisis created this crisis, and are again buying their own defaulted on properties, and will do it again in another seven to fifteen years. This I know.

J