Money Monday

The News

Car inventories are increasing

Obama will direct federal regulators on Monday to move swiftly on an application by California and 13 other states to set strict automobile emission and fuel efficiency standards.

Emissions Are Increasing

California will rise again

To the surprise of progressives and anger of the GOP, leading Dems support investigating the Bush administration's crimes.

Obama is concerned that the YouTube generation that elected him is tired?



70,000 more jobs lost

Pfizer to buy rival for $68B

VIENNA: The United Nations' crime and drug watchdog has indications that money made in illicit drug trade has been used to keep banks afloat in the global financial crisis, its head was quoted as saying on Sunday.

"In many instances, drug money is currently the only liquid investment capital," Costa was quoted as saying by Profil. "In the second half of 2008, liquidity was the banking system's main problem and hence liquid capital became an important factor."
http://www.iht.com/articles/reuters/2009/01/25/europe/OUKWD-UK-FINANCIAL-UN-DRUGS.php

Anyone remember this?

Dems say bank bailout may increase

 "Lending at many of the nation's largest banks fell in recent months, even after they received $148 billion in taxpayer capital that was intended to help the economy by making loans more readily available." (Wall Street Journal, 1/26)

"Some increased investment (may be required). Change has to happen in terms of what is done, what the transparency of it is, what the accountability of it is. Only then would we be able to pass any additional funding." (Nancy Pelosi)

What does nationalizing banks mean, that the private banks that control the Federal Reserve will have even more control? Is the key real oversight, not a promise of oversight?

Pelosi was asked "whether the government should not just nationalize the banks outright.

"Well, whatever you want to call it... if we are going to put money into the banks, we certainly want equity for the American people" (Nancy Pelosi)

The New York Times(1/26, A1, Sanger) adds that "privately, most members of the Obama economic team concede that the rapid deterioration of the country's biggest banks, notably Bank of America and Citigroup, is bound to require far larger investments of taxpayer money, atop the more than $300 billion of taxpayer money already poured into those two financial institutions and hundreds of others."

The Washington Post(1/26, A1, Irwin, Appelbaum) reports, "Congress is moving to create strong new oversight of the financial sector that would likely give the Federal Reserve authority to examine the workings of a wide range of companies in an attempt to address one of the key failures that led to the financial crisis." However, "the initiative, which could be finalized in the House by spring, is raising concerns about whether it would muddy the Fed's traditional mission and concentrate too much power in a single federal body."

Money is debt. When we borrow money, more is created than we borrowed.

Woodrow Wilson created the current central banking system of the United States by signing the Federal Reserve Act on December 23, 1913.  The Act created a Board of Governors to oversee twelve private Federal Reserve Banks charged with controlling the cash flow in the United States and established a Federal Open Market Committee to oversee the buying and selling of government securities. 

"A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men ... [W]e have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world—no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men." (Woodrow Wilson)

"Since I entered politics, I have chiefly had men's views confided to me privately. Some of the biggest men in the United States, in the field of commerce and manufacture, are afraid of somebody, are afraid of something. They know that there is a power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that they had better not speak above their breath when they speak in condemnation of it." (Woodrow Wilson)

The Obama administration is nominating Jane Holl Lute as Deputy Secretary of Homeland Security. Jane Lute was an official of the Association of the U.S. Army, a defense lobbying group.  Her husband Douglas Lute is helping to coordinate the Bush public relations blitz that is expected to paint the Iraq "surge" report by General David Petraeus in a favorable light.


Hope and change has come to Google Maps.

'The group of vigilante men came to report that while they were on patrol they saw some hoodlums attempting to rob a car. They pursued them.

'However one of them escaped while the other turned into a goat,'  Kwara state police spokesman Tunde Mohammed said.
http://www.dailymail.co.uk/news/worldnews/article-1127012/Police-arrest-goat-accused-armed-robbery.html

Reactions
I want to teach my four year old the Pledge of Allegiance, and rediscover the meaning along the way (A Reader, Kyne)


Your Job:
It's Money Monday. Spend some time today understanding money, how it's created, the role of banks, of the Federal Reserve and the resulting inevitability of inflation.

There are several good mini-documentaries that you can find on YouTube, including this one. Essentially money is debt, debt is money, we require debt to grow and yet debt is our undoing.

Is our monetary policy working? Credit ;) or blame belongs with the The Federal Reserve but yet we could be seeing the Federal Reserve with more power.

This financial crisis began with money made cheap by the Federal Reserve and escalated with the convoluted mess of unregulated derivatives tied to real estate: Credit Default Swaps. The same financial institutions that created the out-of-control derivatives, whose total value is unknown and can only be estimated, but is estimated to be multiple times larger than the stock market, are the financial institutions getting the bank bailouts.

Though banks are sitting on their cash and acquiring other banks. Companies still cannot get loans, homes are foreclosing, the public is in a panic. People are losing their jobs and people not losing their jobs aren't spending money at their local restaurants or businesses.

What can we do? What should we do?

Obama wants to create jobs improving our infrastructure, health and education. The so-called fiscal conservatives didn't balk at financing the alleged improvement, health and infrastructure of Iraq. They didn't stop the bank bailouts, so is the real reason they oppose Obama's stimulus program because this money doesn't go directly to the big businesses they cater to?

Monetary policy is not an easy subject. I can't solve it in the Comments section, but today we can all learn about it, discuss it, make suggestions for the future or more pragmatically, make suggestions for the present. Jobs are disappearing, so where can one find or create work? Where are the opportunities? We should save our money to prepare for tough times but if no one spends any money, than the tough times get worse. 

Suggestions?