Shock Treatment for America - The US prepares for Martial Law ?

Here's a good explanation of the bailout.

http://www.breadwithcircus.com/bailout.html

Quote :

The scheme is actually pretty simple. Please forgive my primitive graphics abilities.
The fund will buy mortgages from the banks at market value, and then re-sell them back to the banks at a discount.
The fund will then repurchase those mortgages from the banks, who will sell them back to the fund again.
The same product (perhaps an ill-advised mortgage for a half-million dollars taken out on a house in the distant
suburbs of Las Vegas) will be bought, then resold, then re-bought and re-resold in an endless spiral of profit-taking.
The taxpayer will lose on every transaction, the banks robbing the treasury each time each mortgage, or
package of mortgages is swapped.

It is amazing to observe the greatest transfer of wealth in history, from Main Street to Wall Street,
from the many to the few. What is even more amazing is that nobody seems to be stopping it.

Also,

Explaining the Credit-Crisis: Why The Bailout Won't Work

http://www.breadwithcircus.com/creditcrisis.html

A nice wee summary of the financial pyramid scheme that is now the foundation of the US's economic foundation.

I might add that much of the analysis on other threads has been insightful and added another dimension to the discussion on this site. While, many might not agree with all or parts of the analysis, it is to be welcomed. May the good work continue.

The question now is what do we, as individuals, do going forward? I've already made my own mind up and will not be buying into the patriotic nonsense about pulling together for the good of the nation. I lived in the US for 10 years and saw where it was heading and came home. . The Irish message is no different than that being pedalled by sections of the US political establishment while the boys and girls creating the mess in Ireland are bailed out by the tax-payer.

I know what I have to do given my age and circumstances but I'm mentoring my neice and trying to maintain a very level headed approach to what her prospects are for the future. I'm not into conspiracy theories (zero return) or even into painting a negative picture. She has a great work ethic and is doing well at Uni in Scotland. Her prospects appear very good. She will be well armed to meet the challanges of the future but I firmly believe that every financial decision she takes from day one in her new career will have bigger impacts than the decisions I took in my rambling youth. There is just less leeway to make mistakes in the future. gl

Did it all start at the end of the nineties with Clinton and Fannie?

NYT

credit to TT on p.ie for digging this up

The bailout will work perfectly. Tha banksters will get 700 billion dollars

Inflation or deflation now - I haven't a clue how to get my head around it. The Daily Express believes that petrol in the UK will fall to 74p a litre and the oil barrel could fall to $30 - will this be because no one will have a pot to piss in and demand will collapse?

Quote :

THE world’s economy was saved from total disintegration last night when the United States Congress finally agreed the biggest banking bail-out of all time.
The £397billion package means that struggling US banks will be shored up, with massive knock-on effects for the financial markets and, ultimately, hard-pressed families in Britain.

In separate good news, supermarkets embarked on another petrol price war led by Asda and Morrisons, who will today cut pump prices by up to 2p a litre. At the same time, analysts forecast that the price of a barrel of oil could fall to as low as $30 by next year, which would see petrol plummet to around 74p a litre.

The historic American rescue package, passed by 263 votes to 171 by the House of Representatives, will restore confidence in the world’s shattered financial institutions.

Express.co.uk

also the bloomberg article on it.

Auditor #9 wrote:

Did it all start at the end of the nineties with Clinton and Fannie?

NYT

credit to TT on p.ie for digging this up

I've posted a bit along with rockyracoon on the Economic Crisis thread on this. The way it was imo is that the rate of profitability declined from the 1960s for a number of unavoidable reasons - more expensive oil, more expensive technology and education and 'rusting' manufacture being some of them. This was masked over by expansion of credit that drove a series of inflationary booms. The dot.com bubble was "bailed out" by pushing the property bubble that the link posted by Pax describes so well.

What to do about it all? On a personal level I've been cutting the overheads and planting the veg for the last year and am working around the clock to try and pay off the last bit of mortgage as fast as possible. What the children will be facing into is a worry for everyone. On the wider level, I think we need to stick together against the Basturds and start working out how to organise things in a different way.

Auditor #9 wrote:

Did it all start at the end of the nineties with Clinton and Fannie?

NYT

credit to TT on p.ie for digging this up

No, it started in the 1950s in the University of Chicago (theoretically) in in 1973 in Santiago (on a practical level).

Brad Sherman says that Congressmen and women where threatened with martial law if they didn't vote the Paulson Bill through.




Naomi Wolf here is calling for the arrest of the President and says a coup has taken place in the US. She points to changes to the command of military by the President. The dramatic tone is hard to listen to, but what she describes warrants very careful listening.



Fox News is running daily stories suggesting that the Poll will be contaminated by electoral fraud. Any bets that an Obama victory would be challenged legally?

Britain has used anti-Terrorism legislation to freeze the assets of an Icelandic Bank. The Icelandic FM said "We don't consider this is a particularly friendly act".

cactus flower wrote:

Britain has used anti-Terrorism legislation to freeze the assets of an Icelandic Bank. The Icelandic FM said "We don't consider this is a particularly friendly act".

Why would they need to? Is there not a bilateral agreement wherein Iceland pays the first £16000?

Mind you anyone who believes that the anti terrorist legislation had anything to do with terrorism is seriously deluded. It had a lot to do with tracing money and tax evasion.

As for Iceland I do think the EU should collectively take a more helpful position. They are not exactly a hostile neighbour.

Squire wrote:

cactus flower wrote:

Britain has used anti-Terrorism legislation to freeze the assets of an Icelandic Bank. The Icelandic FM said "We don't consider this is a particularly friendly act".

Why would they need to? Is there not a bilateral agreement wherein Iceland pays the first £16000?

Mind you anyone who believes that the anti terrorist legislation had anything to do with terrorism is seriously deluded. It had a lot to do with tracing money and tax evasion.

As for Iceland I do think the EU should collectively take a more helpful position. They are not exactly a hostile neighbour.

In the CNN piece on Iceland today the voiceover kept saying Ireland

The British Local Authorities and the Metropolitan Police seem to have lost many millions with the collapse of the Icelandic Banks.
The British Government are making shapes that can only be described as hostile - suing - anti-terror legislation to freeze assets.

British property price decline is not doing much good to the value of the assets of the Irish Banks.

cactus flower wrote:

The British Government are making shapes that can only be described as hostile - suing - anti-terror legislation to freeze assets.

Of course they are going to use whatever legislation they need to freeze financial assets and recoup funds. They are trying to ensure that Iceland keeps to their agreement hence the legal action. If I remember correctly the Icelandic government made statements that Iceland would not cover overseas depositors. Imagine it was Ireland would you not want the government to try to recover whatever they can?

That said still think we need a joint European initiative in relation to Iceland. It is a small country, and a friendly state.

cactus flower wrote:

British property price decline is not doing much good to the value of the assets of the Irish Banks.

And Irish ones are doing even even less good.



On the American elections why would anyone be overly concerned if Obama won? Seriously! If Nader looked like winning, well yes, I could see feathers being ruffled, but Chicago politician Obama a revolutionary threat, they can't be serious. Yes both sides will be issuing legal challenges if this election is close. Obama has a track record of this sort of activity and well the Republicans we know all about.

The Left love revolutions and takeovers. Why is Bush leaving it to the last minute? What really annoys me is why on earth did the Congress not simply impeach him long ago. Would have saved everyone a lot of pain.

Squire wrote:

cactus flower wrote:

The British Government are making shapes that can only be described as hostile - suing - anti-terror legislation to freeze assets.

Of course they are going to use whatever legislation they need to freeze financial assets and recoup funds. They are trying to ensure that Iceland keeps to their agreement hence the legal action. If I remember correctly the Icelandic government made statements that Iceland would not cover overseas depositors. Imagine it was Ireland would you not want the government to try to recover whatever they can?

That said still think we need a joint European initiative in relation to Iceland. It is a small country, and a friendly state.

cactus flower wrote:

British property price decline is not doing much good to the value of the assets of the Irish Banks.

And Irish ones are doing even even less good.



On the American elections why would anyone be overly concerned if Obama won? Seriously! If Nader looked like winning, well yes, I could see feathers being ruffled, but Chicago politician Obama a revolutionary threat, they can't be serious. Yes both sides will be issuing legal challenges if this election is close. Obama has a track record of this sort of activity and well the Republicans we know all about.

The Left love revolutions and takeovers. Why is Bush leaving it to the last minute? What really annoys me is why on earth did the Congress not simply impeach him long ago. Would have saved everyone a lot of pain.

Have a read of this, Squire:

http://www.armytimes.com/news/2008/09/army_homeland_090708w/

Do you remember this going through?

Quote :

The 2007 Pentagon spending bill included a measure to amend the Posse Comitatus Act to clear the way for the domestic deployment of the military in the event of natural disaster, terrorist attack or “other conditions in which the president determines that domestic violence has occurred to the extent that state officials cannot maintain public order.”


The provision granted the president sweeping new powers to impose martial law by declaring a “public emergency” for virtually any reason, allowing him to deploy troops anywhere in the US and to take control of state-based National Guard units without the consent of state governors in order to “suppress public disorder.”

The provision was subsequently repealed by Congress as part of the 2008 military appropriations legislation, but the intent remains. Given the sweeping powers claimed by the White House in the name of the “commander in chief” in a global war on terror—powers to suspend habeas corpus, carry out wholesale domestic spying and conduct torture—there is no reason to believe it would respect legal restrictions against the use of military force at home.

It is noteworthy that the deployment of US combat troops “as an on-call federal response force for natural or manmade emergencies and disasters”—in the words of the Army Times—coincides with the eruption of the greatest economic emergency and financial disaster since the Great Depression of the 1930s.

Nancy Pelosi was named by Congress representatives as having waved martial law as a threat - and even claimed that martial law was in effect, in arguing to get the Paulson Bill through. A win by Obama would not be welcome not because it would be a revolution but because it would disrupt the Republican machine and more importantly would raise the confidence and expectations of Democrats and supporters in the wider population. The wider population have consistently been better off and the hyper rich relatively less well off under Democratic governments.

At the moment though things have gone beyond normal politics and the US goverrnment is preparing for civil unrest, which may or may not happen spontaneously, or could be provoked. It might be marginally less easy to deal with opposition under a Democratic Presidency. When push comes to shove, I wouldn't see the likes of Pelosi standing in its way.

I hope Polisi gets booted out come November. Utter waste of space.

Could an alternative explanation be that they are anticipating civil disorder if there is a financial failure and banks close? To me it is a reflection on how serious the economic crisis is. Seems more probable, and it is not that I am at all fond of Bush. In fact what I would do with that man if I had my way would probably need a little reflection. Dumping him in a field in the middle of Afghanistan or Iran would seem a good initial starting point.

Squire wrote:

I hope Polisi gets booted out come November. Utter waste of space.

Could an alternative explanation be that they are anticipating civil disorder if there is a financial failure and banks close? To me it is a reflection on how serious the economic crisis is. Seems more probable, and it is not that I am at all fond of Bush. In fact what I would do with that man if I had my way would probably need a little reflection. Dumping him in a field in the middle of Afghanistan or Iran would seem a good initial starting point.

That is a strong probability - not different to what I'm saying. One way or another I think they know the game is up and also how angry people are. If you look around the US boards people are not only angry they are also very clear about what is going on. I wish that we were as aware here. The shock here will be enormous.

http://gritsforbreakfast.blogspot.com/2008/10/how-will-economic-distress-effect.html

cactus flower wrote:

That is a strong probability - not different to what I'm saying. One way or another I think they know the game is up and also how angry people are. If you look around the US boards people are not only angry they are also very clear about what is going on. I wish that we were as aware here. The shock here will be enormous.

What you are suggesting is a plot, a take over, or a more open attempt than normal to rig an election. That is not the same as making provision for maintaining order if a collapse does occur. If there is a collapse then surely no one wants a descent into barbarism and survival of the strongest? If that were to happen that would indeed be negation of duty.

If order did breakdown that would be one difficult country to sort out.

The auto industry in the US is going into meltdown. General Motors is walking the tightrope and simply may run out of cash before it can get out of the mess it is in. The share price is the lowest it's been since before the Korean War. Corporate bonds are rated as junk. It's not looking good.


http://biz.yahoo.com/ap/081010/auto_stocks.html?.v=5

Squire wrote:

cactus flower wrote:

That is a strong probability - not different to what I'm saying. One way or another I think they know the game is up and also how angry people are. If you look around the US boards people are not only angry they are also very clear about what is going on. I wish that we were as aware here. The shock here will be enormous.

What you are suggesting is a plot, a take over, or a more open attempt than normal to rig an election. That is not the same as making provision for maintaining order if a collapse does occur. If there is a collapse then surely no one wants a descent into barbarism and survival of the strongest? If that were to happen that would indeed be negation of duty.

If order did breakdown that would be one difficult country to sort out.

There is a widely held feeling in the US that the present government precisely represents "a descent into barbarism and survival of the strongest". There is also a belief held by many for some time that the President and Vice President are acting in many ways outside the law and should be impeached. The law has been changed under the threat of terrorism to give unprecendented powers to the President to directly control the military instead of Congress. The Patriot Act brought in much of the legal framework needed to run what we would consider to be a martial law state /military regime with dissolution of normal human rights and freedoms.

The word use of the word terrorism by the President is enough in the new US law to allow for abandonment of democracy. Hurricane Katrina has been used to normalise the presence of troops on the American streets. They were there for protection of private property not on a rescue mission and if you remember people in need were left for days on end without food or water. A number of large temporary tented jails have been set up in the last year under the guise of immigrant control and in recent weeks there have been big predawn sweeps and pick-ups of immigrants that some view as exercises. During the Republican Convention a large number of journalists was arrested and their film destroyed and the arrest and beating on the streets of journalists is becoming a regular event. Six very young anarchists have been charged with terrorism offences for supposedly having a couple of axes. A look at the Canada thread here will give you the picture. We now see armed forces being called back from Iraq for active service on the streets of America, and being trained in the use of tazers, noise assault and the full range of range of anti-civilian and anti barricade tactics.

The Paulson Bill (original) which provided the foundation for the Bill that was enacted, was an instrument for completely unaccountable and undemocratic financial dictatorship by a named individual. Imo it is not possible to operate a financial dictatorship without back up by armed forces.

I think the Americans put great mas on their democratic rights and freedom. I talked with a family last year who were a US army family going back generations who were appalled and deeply disturbed by the Patriot Act. The vote against Paulson in Congress came about because so many hundreds of thousands of people, Republican and Democrat, phoned, emailed and faxedtheir Congressmen and Congresswomen.
The Americans are not at all in our position: many of them hold two jobs down and they have been working desperately to maintain their living standards. THe US is listed as the most competitive economy in the world. There is no fat to cut.

One US Sheriff has refused to carry out any more evictions on grounds that many of the people who have been evicted were not the mortgage holders and didn't owe anything. It is likely others will follow.

There is no question in my mind that Americans don't want to live in a dictatorship put in place to protect the tiny layer of people who have wrecked their lives. The question isn't Bush or barbarism, its Bush and barbarism versus democracy and basic rights.
If there is a collapse Bush or his like will use armed forces to try to maintain his position and the position of the ultra wealthy and will do nothing to safeguard the wider population. Katrina really should tell us that, if nothing else (note that Mr Ganley got his medal in that operation).

Naomi Wolf is a funny looking Jefferson and I wish there was a more serious looking opposition ready made. But I have no doubt that the Americans will defend their democracy and agree that the message needs to go out loud and clear that a martial law state will not be tolerated.

rockyracoon wrote:

The past two weeks in the US have been truely historical but they will pale in comparison to what will happen over the next week and the coming months. Bernake and Paulson have engineered one of the world's greatest shell games in front of the entire world and they only need Congress to pass an emergency bill which will obligate the US taxpayer to fund their own financial enslavement to the tune of $700 billion or so. In the last two weeks they've re-engineered the entire banking system through the creation of the mega-banks; essentially made the SEC redundant (one of the remaining regulatory agencies with some bite left); and have created a crisis so wide in its scope that they have nearly scared Congress into writing a blank cheque from the US taxpayer to recapitalise the very banks that have created the financial chaos. Today's WaMU takeover by whatever mega-bank for peanuts is just another example of their intent.

I take my hat off to Bernake, Greenspan, Paulson (and all Treasury Secretaries since the Reagan Adminstration) and their minions who've created this scheme and have implemented their strategy and tactics with a mastery unrivalled in modern history. However, there are about half a dozen senior Republican Senators who have thrown a spanner in the works. They want an equity stake in the mega-banks for the US taxpayers who are being asked to bail out the banks. It seems a small ask of Bernake and his cronies to give the US taxpayer a small stake in the companies who, afterall, will be allowed to carry out with their overall plan.

Yet, the sheer arrogrance of Bernake, Paulson and their pals is a sight to behold. Bernake and Paulson rode into Congress like they were some white knights coming to the rescue the maiden and were quite surprised when the Senate Banking Committee had the audacity to start asking questions before handing over a $trillion dollar cheque to Bernake & Cos banking buddies. These guys actually throught they had Congress and the US populace in such a frenzy that believed a blank cheque would be waiting at the door for them to collect. I wouldn't have been surprised if they thought the Finance Committee wasn't going throw them a party. Both Bernake and Paulson looked shell-shocked at the end of four hours of questioning. They truely couldn't believe that the good Senators would dare question them about banking. How dare they!

Over the past year, I think I have come to understand what the "new" global economy or village is all about. It's all about the very wealthy being as comfortable in tax havens in the Caribbean or Dubai as they are in New York, London or Frankfurt; while the wage earner is lectured about patriotism. What we are seeing is a never ending quest by some to accumulate as much wealth in as few hands as possible. Borders and nations are no longer of concern to the ultra-wealthy in the world - they are global players. Only the maintenance and growth of individual wealth is of importance. Our governors are too stupid or greedy to intervene. They are now part and parcel of this system.

Its seem like it's up to a few old "timey" senators in the US to at least put a partial brake on the scheme. Of course, the US presidential candidates could take a brave stand and begin to debate about the reintroduce regulatory frameworks like Glass-Steagall and more modern programs to reign in the unbridled greed and casino-like tendenancies of bankers. Indeed, they should put banking where it belongs as a conduit for real investment instead of a means of impoverishing wage earners and tax payers. 'Taint likely to happen.

Some see this era of financial consolidation as a new panacea where the US will be forced to reign in its profligate habits by other nations and national-blocs. This seems highly likely as the dollar (its debt) will be devalued as a holder of wealth. I can't see how the Oreintal side of the world won't become predominant economically and with attendant geo-political realinement. One thing I'm damned sure about is that if you're not in the top 5-10 percentile of any existing mature economy that you're standard of living, and that of your children, will erode and will continue to erode in the coming decades. The erosion of living standards may be dressed in commodity shortage or environmental clothing but the erosion will continue. Of course, if you're in the upper percentile, and connected into the global economy, things will never seem so good.

Krugman of the NY Times, named for the Economics Nobel Prize today, had this to say about the parallels between the military and economic dictatorship, in relation to Paulsons demands:


http://www.nytimes.com/2008/09/22/opinion/22krugman.html

Quote :

Some skeptics are calling Henry Paulson’s $700 billion rescue plan for the U.S. financial system “cash for trash.” Others are calling the proposed legislation the Authorization for Use of Financial Force, after the Authorization for Use of Military Force, the infamous bill that gave the Bush administration the green light to invade Iraq.

Interesting remark from Nader. He describes Bush as George the 4th.

No Tax without proper representation!

I've been thinking about this martial law business for a while now. The scary thought that nobody in the world is big enough to stop it if it happens is constantly on my mind. I've been on the verge of contacting family over there several times to tell them to get the hell out of there. I haven't because I don't want to cause unnecessary panic. i'm not sure what would be the moment that would swing me to make that call and I certainly hope its never.

I feel that just as globalisation demanded the spread of US bases, political interference and intelligence, so the "coming home to roost" of globalisations problems demands the heavy hand of the State in the US.

The fact that there is a trend in that direction doesn't mean that it would be successful. There is a high level of distrust of Federal government in the US and most households are armed. A lot of US soldiers who fought in Iran were local voluntary troops roped in reluctantly: would they necessary choose Paulson over their own people? If I was the President of the United States I would think twice about starting a shooting war.

The bigger problem imo is lack of political leadership to face down any move against democracy. When Chavez was theatened with a coup he and his supporters stood firm and it failed. Would Obama?