The CRASH of '08

I'm sitting here listening to CNBC - I don't have money but love to watch those who do, it's like going to the monkey cage at the zoo - anyway, if there is an Internet, and blogger.com, and a future! and my posts live on in the ether long after I'm gone, I have to muse in real time here and give a view on what is happening in this country day to day now.

People, my mother told me about growing up in the depression and how life in a small town was. I'm grateful for the memories 'cus it sure helped shape my ability to see beyond the what's happening now, and taught me, in the end, you only have your 'self' to help you stay afloat.

As of Sept 23, 2008 we are on the verge of total stock market collapse. Not just here, but worldwide. Pres. Bush was on TV last night trying to explain to the public why the American government MUST give an open ended 700 BILLION $ check to one man (well, actually 2 - Paulson - he made over 500 MILLION working at the failed Sterns company over the last 10 yrs! -and Federal Reserve chairman Ben Bernanke who teaches economics) to dole out to failing bluechip companies to keep them floating while the market evens out. OK, here it is in a nutshell: if you have a mortgage you will immediately understand. Mortgage contracts, for at least 10 yrs now made between the mortgagor and mortgagee are not between just them. Once you sign for a loan on a house, the person lending the money can do ANYTHING they want with that paper, if you read the fine print, which you didn't', you agree to this. So, it is used like real money and bought and sold to other lending institutions, who then traded them to other bigger companies and that included any company who thought there was money to be made there.

So, what happened? All kinds of laws were slowly removed, or didn't exist, or were flat out broken getting people into mortgages they could not afford, or their lives changes so dramatically (illness, death of others on the paper, divorce, abandonment, job loss etc) they could not make their payments. Also, during this time there was a BIG push to "flip" houses - it was quite the fad, the TV was covered over with, buy a house cheap and fix it up and dump it for tons of money. The cost of houses went through the roof, and money was cheap to borrow because the loans being pushed by loan companies were variable rate loans that were cheap to pay up front but allowed to skyrocket within a few yrs of signing. How can I make that statement? Well, I spent a heap of money getting a real estate license and was hired by a mortgage company to "sell houses" when what I really was selling was high cost variable rate loans. All I had to do was push a house and they took care of all the paper for it. I quit within a few weeks of taking this job and let my lisence lapse. When this hit - the last yr or so, people who had 700$ per month loans they could barely pay were faced with loans that went into the 1000's$ per month and they just walked away or where put out of their homes. Thus all the money on paper out there, one mortgage at a time was turning into nothing but real paper, just worthless paper.

Giant companies on wallstreet dealing this worthless paper was left holding the bag because they lost "cash" to operate. Now, congress and pres Bush wants to "bail" them out "for the good of the nation, for the good of main street and the world." (BTW one of the biggest companies AIG is owned by an international consortium and is not fully an American company.) Part of the plan means the government will own 80% of this company.

Isn't this precious! This money will be: a. printed as needed by the federal reserve, and b. backed by the taxpayers of the United States. Nice idea and here's why it won't work. This is a cyclical disruption to the market, no matter what greed by wallstreet, fleecing of the American Public, payouts by multi billion $ lobby firms, and stupidity within the government at ALL levels, state and local here included has caused. This money, this 700 billion, will only be a stop gap - like plasma for a hemophiliac with a gun shot wound. The money comes from the bottom up, all the nickels and dimes and dollars the American Public has pored into EVERYTHING that could possibly marketed has run out!!! The government has had this 'trickle down' economy model since Bush took office! Big money poured into rich pockets was supposed to leak out to the Public so we could all go out and spend spend spend, making rich people richer, keeping the economic wheels turning. The public was invited to a banquet and when we saw all the pounds and pounds of mouth watering food on the table we told to stand by and we could eat all the crumbs we could gather that fell on the floor. And, God help the Public, they thought they could actually get to the table if they just worked hard enough.

This money won't work because: these companies HAVE to fail, they are mismanaged, they are corrupt by their greed (CEOs making millions a year for nothing!), they are flimflam and selling illusion, pushing paper around, it's all on paper, there is no reality until someone stops the machine and says, but, I want my money in hard, real cash right now. There has to be a NEW way the world, yes, we are one here folks, we are the world, all those techno gadgets everyone can't live without has created a new world view and economics has to follow into this new world.

This money won't work because while all this is happening a hurricane has shut down Galveston, TX weeks ago and no gas is flowing, there are now at least 4 states (NC, SC, TN, GA)in the southeast where gas pumps are slowly being shut for no gas, and the gas cost is rocketing - again. OK, this means people can't get to work!! Those who have jobs. And, don't think the oil companies aren't culpable, they have been sucking billions out of the federal government for the last 10 years, also in the form of tax rebates, tax easement and downright oil welfare programs all the while sitting back and not doing anything to put money back into procuring more oil. Which, by the way, is nearing the pointless realm since oil is FINITE. Even the most conservative of all Christian believers must get that God only made so much oil for our use, it doesn't rain out of the sky into holding tanks every night after its prayed for! So, that's a botched, greed sucked finite commodity. If you've NEVER seen a HUMMER you just don't get this sentence, although all of you who drive a gas hog SUV still might, 100$ and climbing at a fill up now, but, heck, its only money! Never mind the rest of us who MIGHT NEED A GALLON OR 2! but, gee, the oil is all gone. These are usually the "drill anywhere, find more oil, its all the government, THE DEMOCRATS! not letting oil companies RAPE the land and oceans" crowd.

OK, 1 MORE TIME!!! OIL IS A NATURAL PRODUCT THAT CANNOT BE MANUFACTURED ARTIFICIALLY. IT IS FINITE - THIS MEANS IT HAS AN END POINT! THE START OF THE BIGGEST OIL FINDS WAS IN THE 1930s. THE PEAK FLOW WAS SOMETIME IN THE 1960s. IT'S BEEN DOWN HILL EVER SINCE. ALL THE OIL LEFT ON THE PLANET WILL ONLY LAST MAYBE 20 YEARS ON THE OUTSIDE!! DO YOU GET IT NOW?!? If you are sitting in a gas line, or your car is parked and you can't get to anywhere this it the new reality. When the gas runs out this is exactly how it will happen, you wake up and the pumps are turned off. This is what will happen if new ways to operate without oil aren't found NOW. (BTW, we do have coal reserves and could make electricity, albeit dirty, by burning coal - BUT if you weren't watching, we are SELLING OUR COAL overseas, mostly to China! It leaves this country by the train car load - OK, for those of you not up to speed, the train car is lifted off its wheel base by a crane and put into the hold of a cargo tanker, it doesn't run over water to china - I know most of you readers "get" this, but I see Jaywalking on the Tonight Show and I do understand that there are many of you out there who would be dead if breathing were not an automatic body function... that's the group who think you can just go and drill for more oil, too...)

Sorry for that segue above, but the main point is, people who don't go to work don't get paid. People not getting paid don't spend that slush money which should float to the top for corporations to skim. People who don't get paid don't pay bills, like mortgages, and end up on the street. Here is a bright spot on this economy. If you lost a big money house you may end up losing the hundreds of thousands you've invested, there is a federal law on the books that might also give a TAX on the amount you lost, your credit immediately goes in the toilet for years, and of course, employers have access to those credit reports which will lose you a job that could have helped pull you out of debt. Mainly there is one more person out of that spending machine loop.

These huge companies have moved jobs out of America where virtual economic slaves make the goods we are expected to line up and buy here. The money flowing in the rest of the world for labor is also for the most part a trickle, just enough to keep bodies alive, but not enough to climb out of slavery. Unfortunately, as above, no work here -no paycheck -no spend in America. Today, the "figure" for unemployment is officially around 6%. OK, in SC where I live I heard the news last night about a county getting a plant to employ 65 people and they were 8th in the state for unemployment at 12% so there are 7 counties at ever higher unemployment levels. I think the real figure of unemployed Americans is over 12% maybe 15% and growing higher every day. (Unemployment is figured on the weekly jobless claims filed, once you run out of unemployment you fall off the list, never mind if you don't ever get another job! You just dsappear!) BTW, those 65 jobs will most likely be filled by illegal aliens, yes, I said it because its the truth. There is nothing wrong with these economic slaves coming to American, we are a Nation of immigrants after all, but they should proudly request visas or papers to come here and become citizens, not risk their lives sneaking over borders by dark and then selling themselves into economic slavery here. It spirals the economy lower and lower here for all the working people in America-working poor to middle class. It's not an issue for the rich, they just stay rich; actually they get richer as the bulk of the popuation gets poorer.

It won't work because: this will make our money worth less that what it already is, no matter how hard the American public works now their paycheck is worth less, prices are going up for everything that has a dollar attached to it: all taxes, home payments, utilities, food, gas -everything. Mortgages made when a house cost was through the roof must still be paid as if that house was worth that much, but the worth of a house, the selling price is dropping like a rock down an empty well; which shouldn't bother most of us since we want to live in our homes, not jump in and out of them, BUT if you get behind that falling rock and MUST sell, you can't get your money out of it, its another lose situation.

As for those of us nearing or in retirement we have to find jobs, in a slow to jobless market to hang in there until the cost of our coffin is met, while the inbetween of this is we must pay all the regular bills everyone else has plus a trade off of mortgage debt for heathcare costs. And, from the bottom up of this are all the kids coming out of high schools, 2 year schools and higher every year also looking for jobs, in many cases to pay off higher education debt. We are being told we MUST eat this bailout, companies can't make jobs for us if we don't give them OUR money to PAY it back to us in a paycheck so we can SPEND it on crap and make the companies MORE money. Well, that boat left will all the jobs they already shipped overseas!

The bottom line is: no matter how trickled we've been, the money is just not there to run up the food chain. the American public is up against the wall in a hard way and WE are not getting any help here, and saying 700 billion dollars and even more will TRICKLE DOWN TO MAIN STREET is more than insulting to a hurting public. WE NEED THE 700 BILLION! WHERE IS OUR BAILOUT! we've been putting money into this economic engine for years now and have seen our American dream lives slip away from us. When you or I any average guy starts a business and we are poor managers, we don't watch our money, we don't watch what we make or do for our money, we cant go to government and ask for cash to fix our poor ability to run a business. what we do is go under. hopefully we learn and start something else, or learn we shouldn't run a business and do something else altogether. It's time for a new dream here and I think it can be had with out all these rich welfare cheats hanging onto our coattails. My mom always said: fool me once shame on you, fool me twice, shame on me!!!

today

Watched the republicans last night, at least as much as I could stomach. What is wrong with some people!! How sad to see the depths this Grand Experiment, this America has fallen over the centuries. Too bad, we almost made it, now it's just waiting for the end. I wonder if the Romans felt this way just before the hordes reached the gates.