Archive for the ‘finance’ Category

Here’s another in our continuing lecture series, this time from UC scholar Elizabeth Warren on the (then) coming collapse of the American middle class.  This lecture was delivered in 2005 and is just as relevant today as  it was prescient then.  It’s also an hour long, so grab some coffee, cocoa or tea and get comfortable.

This video is a must-see for anyone who wishes to understand the truth behind our present economic disaster and why Republicans should never, EVER again be trusted to control the country’s wealth.  They ran us into the ground many times before, and they’ll do it again.

So you see, the disaster visited upon us by Bush & Co isn’t an aberration.  It’s a logical result of a failed ideology.

Anyone who thinks this recession is going to be over by year’s end just isn’t paying attention.  If you think housing is about to rebound, you’re delusional.  The latest casualties of the housing bubble is just now starting to rear their ugly heads.  Check out these stories from Reuters:

U.S. property bust threatens condo “death spiral”

MIAMI (Reuters) – Rust pokes through the peeling paint on the railings, pest control has been curtailed and the palm trees are no longer being fertilized at the 1940s-era Miami Modern condominium building in Miami Beach.

The condo association has been forced to cut expenses because the owners of 11 of the 28 apartments in the modest two-story building are delinquent, victims of a mammoth U.S. real estate collapse that has hit Florida especially hard.

With so many cash-strapped owners failing to pay their monthly fees for upkeep, the condo board last year had to raise $40,000 with a special levy to fill a giant hole in the $80,000 annual budget, but only managed to collect $19,000 from the owners who are still able to pay their bills.

Florida’s condominium and homeowners’ associations are facing what experts call a trickle-down disaster from the property crisis. Dozens and perhaps hundreds of condo buildings have budget shortfalls as thousands of owners, under water on their mortgages or in foreclosure, stop paying monthly fees.

“I call it a death spiral,” Miami Beach city commissioner Jerry Libbin said. “It’s a catastrophe in the making.” …

and the New York Times:

Banks Starting to Walk Away on Foreclosures

SOUTH BEND, Ind. — Mercy James thought she had lost her rental property here to foreclosure. A date for a sheriff’s sale had been set, and notices about the foreclosure process were piling up in her mailbox.

Ms. James had the tenants move out, and soon her white house at the corner of Thomas and Maple Streets fell into the hands of looters and vandals, and then, into disrepair. Dejected and broke, Ms. James said she salvaged but a lesson from her loss.

So imagine her surprise when the City of South Bend contacted her recently, demanding that she resume maintenance on the property. The sheriff’s sale had been canceled at the last minute, leaving the property title — and a world of trouble — in her name.

“I thought, ‘What kind of game is this?’ ” Ms. James, 41, said while picking at trash at the house, now so worthless the city plans to demolish it — another bill for which she will be liable.

City officials and housing advocates here and in cities as varied as Buffalo, Kansas City, Mo., and Jacksonville, Fla., say they are seeing an unsettling development: Banks are quietly declining to take possession of properties at the end of the foreclosure process, most often because the cost of the ordeal — from legal fees to maintenance — exceeds the diminishing value of the real estate. …

So, on the one hand, owners suddenly finding themselves unable to pay the bills, abandon their condominiums in favor of feeding their families.  On the other hand, banks refuse to take possession of houses they officially own because it’s not financially viable to do so.  In both cases, the city affected is left with a run-down, unoccupied building that’s a magnet for crime, rats and other vermin.

I’d like to say “good riddance” to the condominiums, but there really isn’t a silver lining in this.  Florida’s coastline is covered with these hideous, environment-destroying monstrosities, and I really doubt any of them are going to be torn down any time soon.  Imagine our nation’s most beautiful coastlines dotted with thousands of derelict high-rise buildings, crumbling to ruin and empty but for the garbage and detritus of human existence, monuments to human greed and selfishness.

Now consider the other side of it, millions of foreclosed houses abandoned by owners and banks, falling to ruin and vandalism.  Monuments to a failed philosophy of an “ownership society” and the lie that “real estate always goes up”.

This is the future we’ve created.  Welcome to it.

“They need to spend a little time outside of New York, … Because … if you go to North Dakota, or you go to Iowa, or you go to Arkansas, where folks would be thrilled to be making 75,000 dollars a year — without a bonus — then I think they’d get a sense of why people are frustrated.”

– President Obama, commenting today on the clueless and avaricious Wall Street executives who wrecked the economy and are fleecing the country for all they can get

Keith Olbermann had an outstanding Special Comment last night.  I haven’t found full transcript yet, but for now here’s the video in case you missed it.

I couldn’t agree more.  These parasites, crooks and liars have gotten away with their economic rape and extortion for far too long.  They need to be brought back down to earth.

We’re mad as hell, and we’re not going to take it any more.

When AIG revealed last week that it was planning on paying $165 Million in bonuses to the same idiots who nearly caused it to fail last year, and was using taxpayer dollars to do it, the Obama administration’s initial reaction was almost calm indifference.

Larry Summers, Obama’s senior economic advisor, went on the ABC Sunday talk show “This Week” to say, “We are a country of law. There are contracts. The government cannot just abrogate contracts.”

The New York Times reported that “the bonuses will go forward because lawyers said the firm was contractually obligated to pay them.”  The same article also predicted that “The payment of so much money at a company at the heart of the financial collapse that sent the broader economy into a tailspin almost certainly will fuel a popular backlash against the government’s efforts to prop up Wall Street.”

AIG’s current CEO laughably stated that “We cannot attract and retain the best and the brightest talent to lead and staff the A.I.G. businesses — which are now being operated principally on behalf of American taxpayers — if employees believe their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury.”

Do they really want to keep the same people on board who burned the fucking house down?  That’s like handing the keys to your new Jag over to the drunken teenager who just wrecked your Porsche.  AIG didn’t have “best and brightest”, it had a collection of money-grubbing, amoral, hubristic jackasses who didn’t think their actions would have consequences.  They partied as though there was no tomorrow and now that the bill is due, they want us to pay it.

Well, the people have spoken, and they’re pissed.  In a time when millions of Americans have lost their homes, their jobs, and their life’s savings, the very idea that anyone deserves millions of dollars just for showing up and ruining a company is outrageous.  The financial sector must live in Bizarro-world if it thinks anyone should be paid a “bonus” for incompetence and irresponsibly risky behavior.

Well, no more.  Yesterday the President lashed out at AIG, saying “It’s hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay.”  Exactly what the rest of the country has been saying for about 20 years. It’s just that it took a financial meltdown to get Washington to notice.

If AIG gets away with this, anyone who gets a “bonus” had better spend the money on some really good private security.  They’re going to need it.  For the past year they’ve been engaging in economic terrorism against America.  We’ve had enough.  We’re mad as hell, and we’re not going to take it any more.

Y’know, I watched Cramer once about a week ago.  He was blathering on about making your portfolio “Obama-proof”, as if our present economic mess is somehow the current President’s fault.  So it was with no small amount of pleasure that I watched last night’s PWNage of the Mad Money guy at the hands of comedian and surprisingly thorough investigative reporter Jon Stewart.

WTF?  Jon Stewart?  Of the Daily Show?  Isn’t he a comedian?

Yep.  But apparently in his off-time, he’s been working on scoring a Pulitzer, Peabody, or whatever award investigative journalists get for doing a fucking awesome job of layin’ the smack down on puffed-up, self-important jackasses.  Watch on:

Jim Cramer On “Daily Show”: Full Unedited, Uncensored Video

It’s a beautiful thing, ain’t it?  For years, these jerks have been playing with fire and telling everyone what great fun it is, and now that the house has burned down they want to blame the parents for coming home early.  Time to grow up, assholes.