Charlie Rose

JohnGelles  03/19/2009 10:43 PM Report

In Orange County Obama Promises Prosperity and Greater Fairness in the Economy

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Last night Obama promised jobs and fairness to replace unemployment and inadequate reward for the work we do on the job.

He said he was elected to make the changes that would unstop the clogs in the economic supply system that inadequate demand and insufficient purpose created.

He would also improve our energy, education, health, and political systems on which progress depends.

Since we know it is only a matter of political will that stands in the way of reform, we can be sure he will see his budgets through to passage in the Congress. Then he will see a torrent of spending bring our national and global system back to life.

The big thing about Obama is his common sense and familiarity with politics American style. Following the lead of great presidents before him, he is unafraid of risk and effort.

His partner is Ben Bernanke. So far Bernanke has not lent money directly to individuals and small business. He is waiting for Congress to do that. But, if it becomes necessary, we will see Bernanke establish a channel from his bank to your bank account. He is determined to defeat the demand deficit, come what may.

If the demand deficit is gone and a supply deficit is on its way, Obama and Bernanke will sop up extra demand in quiet savings accounts-- waiting the months it may take for supply to catch up with demand -- as created by the Obama / Bernanke team of heavyweights in political economy.

tartufe  03/18/2009 06:52 PM Report

Obama, Summers, Bernanke are too entwined with the big banks and hedge fund orthodoxy, which was largely - primarily in fact - initiated by the Paulson (three page) rush to throw money unregulated and unmonitored at the perpetrating institutions a la AIG, later Citigroup et al.

Consequently, their sentiments for these institutions imo precludes the possibility of meeting the cause of the financial crisis head on. The too-big-to-fail assertion emphasizes this. This merely obscures the underlying solution, which is they’re too-big-to-survive, as their very growth was due in part on creating the bubble on which to grow to be too-big. In short their size is a sham and is not an asset to be preserved. Indeed they’re liabilities that should be left to filter down to their own natural level. Laissez faire capitalism at it’s best.

The gimmicky financial instruments CDOs (Collateralized Debt Obligations) packaged and repackaged, leveraged and re-leveraged, then compounded by more leverage through CDS (Credit Default Swaps) is intertwined mostly between and within the largest banks and hedge fund institutions. These instruments are so convoluted they are 100s to 1000s of pages long. Determining the NET liability for each institution could take years. Throw in legal delaying tactics and it will run into decades. IMO this has to happen with or without government money. The viability of these participating institutions will be burdened and distracted with their own mess interminably. The so-called systemic risk is largely (80%?) Interlocked within the top 50 or so banks (out of 9,000 +/-?).

Consequently, they should be left out of the future of integral banking. The resulting dislocation imo will not be all that different - but sans the tax vulnerability on the common man’s descendants.

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RESTITUTION:

Confidence will be restored if the people could see that justice was achievable and achieved. The populous clamor against AIG bonuses bear that out. REAL investigations (FBI, SEC, etc), trials, convictions, proportional fines and imprisonment are due and sorely needed. Ways need to be examined to include the enabling legislators in these convictions. Oligarchies need collusion from the government to be successful. Lobbying for repeal of Glass-Steagall, e.g.

Indeed, consideration and action against Henry Paulson should include putting him under house arrest (at least) with a pardon to put him on notice that a thorough investigation of his flagrant and abusive scare tactics which were insidious and capitalizing on the known ignorance of the financial mess by Congress. He used this known lack to bulldoze his three page abstraction into law solely to bailout his ilk - the cronies that created the mess. Paulson's actions initiated the wrong approach from the outset and he and his enablers should be held accountable. Bailouts in the long run is exactly what should NOT have happened.

Paying the perps bonuses for trashing the world’s financial system is anathema. Bonuses in lieu of prison makes a mockery of decency, playing by the rules, abiding by laws, and paying taxes. Makes anarchy more practical than usual. BUT THEY TRASHED THE WORLD!!!!

vanron100  03/18/2009 05:47 PM Report

Your right 'lulu35'...nobody is disputing the culpability of the Democrats in all of this...this is not about 'politics'...both parties are beholding to the 'street'...it's about the 'street' stealing, as in 'business as usual'...that's what needs 'fixing'...that's why everyone should condemn this behaviour...it's all about us.

lulu35  03/18/2009 06:09 AM Report

Paulson Ponzi, funny how democrats and the people who shill for then never want to take responsibility for their actions, first it was Geithner who was the Head of the New York Federal Reserve for the last 4 years, you know the guy who actually regulates and keeps oversight of Wall-Street, and he was one of the key people to put together the first AIG bailout back in October, second when Paulson went to congress he had to do everything the democrats wanted because they controlled congress and what bills would be put up for vote and republicans had already told the Bush administration that they would not vote for the bailout, remember they were the ones who almost uniformly didn't vote for it the first time and the bill failed then they got castrated from the media for their vote, even the second time only a few changed their votes, it was democrats Dodd, Reid, Franks and Pelosi that Paulson negotiated with and it was democrats who crafted the bailout bill, the republican chairmen on the banking and finance committee's didn't even vote for the bill, like Shelby , so if you want to blame anyone for Ponzi schemes look at the party who have been in control of congress since 2006, when the American economy stared to go bad and probably won't turn around until they get kicked out of congress

vanron100  03/18/2009 02:31 AM Report

Paulson designed this 'Ponzi' scheme (TARP). We understand everyone wanting us to buy more stock in order to keep the market up...fix the system...then we'll have 'confidence' to invest.

And that FIX is simple and oblivious, but everyone seems not to be addressing it directly...

- it's 'Corruption-Corruption-Corruption'.

ie. special interest groups, earmarks, lobbyist, elimination of rules and regulations, the financial sector having contributed over $5.2B to political campaigns, same people who got us in this mess are now tying to get us out (humanly impossible...they will, and have instead spent most of the time & money trying to cover-up the industry's underlining behavior).

Corruption is the 'root' problem here...as it is everywhere. Until that gets fixed first...everything else is redundant...we're just pouring $$$ into the abyss! Wall Street has always been Ponzi Street, and the Golden Rule always applies; 'never invest $$$ you can't afford to lose'.

Fix the 'corruption' - then we'll have 'confidence'.

The solution – 'Transparency-Transparency-Transparency'.

How? Start now Restructuring (nationalize, fix, resell) all the zombie banks - the FIDC does this every day.

REMant  03/17/2009 02:24 PM Report

Certainly true, but it is more than just abuse of bail-out money, at least at the higher levels. The Republicans have found a way to undercut Obama, which should have been used in the campaign more effectively, but better late than never. Unfortunately Limbaugh has been a little less than helpful to them. I don't think many Republicans want to see the president fail and they realize he is a good man, who also has to deal with his party. The fact is that the Bernanke-Summers-Geithner Keynesian program is in deep trouble theoretically, and I think within the admin as well and possibly with the president, himself. I wrote about the Bernanke interview yesterday in the 60 Mins blog but had to cut the last paragraph to get in under 5K words. This is what I left out:

We are faced not with an economic crisis, but with a structural, political and legal one, specifically to bring the needs of saving and investment into line with entrepreneurs and workers, so that demand and supply are always in balance without anyone else's help, thank-you very much. Financially, the imperative is to take away all banks' power to create money by lending more than they have in deposits, known as fractional reserve, and thereby the Fed's power to set nominal interest rates by printing money, which in turn will go a long way to force the govt to balance its budget. Productively, we have to return a much greater and sustainable yield on investment, particularly in this country. Politically, we have to enforce those public laws required to stem the selfish behavior that has gone along with easy credit and done much to wreck the environment, as well as create those necessary public institutions, which we have to long lacked to provide legitimate public goods, and to pass a balanced budget amendment. It is more important, too, to prevent a climatological meltdown than a so-called financial one. Legally, we have to find a way to clean up the mess that running a Ponzi scheme out of the central bank for so long has created, instead of attempting to find ways to continue it. Criminal activity voids contracts. All of these measures put power back into the hands of ordinary citizens, esp those with the ability and willingness to work, and are both more democratic and more stimulative than the current program.