Pollywogs!

Yes, a new blog post.

I have this draft, it is simply a bunch of titles. They run the gamut from daylight savings, to illegal immigration, to the stock market, to inflation…none of which I’ve sat down and written about recently. So today, I choose to write about something that isn’t quite on that list: the potential for an impending, pervasive financial disaster…

“Casey gives an apt summary of our present predicament. There is currently $370 trillion in derivatives, hedge funds and over-leveraged marginal investments. There is no coherent relationship between this mass of cyber-wealth and actual deposits or investments. It is merely a fractional banking scam on steroids; computer-generated capital with no basis in reality. As the sub prime market comes under greater strain; hedge funds will teeter, derivatives will tremble, liquidity will dry up and the whole debt-plagued system will crash in a heap. The frantic efforts of the PPT with their flimsy bits of scaffolding will amount to nothing. Wall Street is quick-stepping towards the gallows and there’s little hope of a reprieve.”

Quotes (out of order) from Information Liberation

I don’t know how this is legal, but it is teetering on the edge of collapse:

“It’s all very clever, but layering the enormous size– $370 trillion dollars, far more than the net worth of all the financial institutions in the world – on top of all that complexity is downright scary. In simpler times, a home loan going bad would affect only the particular lender. Enough defaults would put the lender out of business. And that would be the end of it. But today a wave of defaults can send a shock through the portfolios of financial institutions around the globe, including hedge funds, banks and pension funds far removed from the troubled borrowers.”

and:

“In other words, a home loan of $300,000–that may have been secured by a young man with bad credit who makes $12.50 per hour picking up mill-ends and bits of insulation on a construction job site–has been leveraged into a $10,500,000 securities investment. This may explain why Treasury Secretary Hank Paulson is trying to sooth jittery investors with words of encouragement while he dispatches the Plunge Protection Team (PPT) to shore up the trembling stock market behind the scenes. Every effort is being made to keep this monstrous equity bubble from pirouetting to earth.”

What is there to do about this? When too many lending companies go under, and the ripple becomes a tidal wave? That is a very good question, as no one in any serious position to make a change to avert a potential disaster is ‘discussing’ the possibility, much less how to avert it and improve the situation. If you built your house on a deck of cards, and invited all your friends over, you wouldn’t start commenting to them about how shaky the cards were and how you weren’t sure what to do to shore them up, would you? Fuck no, everyone would scatter! And take their money with them! And as the money flowed out, and the companies crumbled, and everyone realized that the blooming economy and buoyant stock market were due to this gigantic deck of cards, the rest of the world would realize the dollar wasn’t worth the paper it was written on. And foreign countries would dump it as fast as they could to get whatever little value they could out of it…and before you know it, the United States that was is no more…

If you ask the corporate cocksuckers who are sucking the nation dry, they’d want bailed out, just like every other major multi-billion dollar industry that, when mismanaged to the point of collapse, holds out their hand to pay bills after the CEO has raped the till.

There are other options. Drastic restructuring (warning: pretty far out there) of our financial institution would do it. But that would require a Congress with some foresight and resolve, which wasn’t battling itself and the Bush Administration over simple things like fighting corruption (if anyone is left to fight against these fucking corrupt criminal assholes) and the endless war the Bush Administration is trying to foster in the Middle East…thank god there are people in the Pentagon who are NOT insane! I want to drive down the the Pentagon and personally give each of those people fighting against this corrupt and insane Bush Administration a box of chocolates, a six pack of beer and a hearty thanks for the bottom of my heart.

I don’t know what is going to happen, I have no idea what the future holds. All I know is that regardless of what happens, the rich and powerful are going to be A-OK. God bless America…