Screw the Banks and Investment Firms

[ygmir]

we seem to be doing a good job of maintaining the old ones..........

[cowboyangel]

True y, true that, too too true, and the beat goes on
no matter what stooge is in the W House
Tiny Tim and Helicopter Ben and Larry and all the neat people of
billderberg and their friends in hell, say yeah!

[ygmir]

isn't there some parable:?

"the more things change, the more they stay the same"..........

[can't sit still]

Scuttlebut says that the Saudi banks are about to crash. Reportedly [Michael Moore], the Saudis own 7 % of America. I've heard higher numbers. With the US imploding, it wouldn't be surprising if Saudi Banks were in trouble too. The big question is, where did Bernenke send all that money. He may have sent it to every central bank in the world. If they get an honest audit of the FED, we may find out that it's central banks that are insolvent,,, not merchant banks. GB comes to mind.
B of A faces a big lawsuit;
http://business.theatlantic.com/2009/09 ... ollars.php

[can't sit still]

The disconnect between "main street" and DC is absolutely amazing. GOV is the only entity doing any hiring. AND, GOV is paying lots more than the private sector for the first time. GOV is having a helluva time getting all "their" new funny-money into circulation. So, they pay big wages to anyone who can finagle a government job.
GOV is just ignoring the producing economy.
GOV is also ignoring unemployment. GOV is 100 % focused on kick starting the economy and getting housing prices back up to the stratosphere. There are about 1.9 million foreclosed houses,,,, millions more to come AND we build 450,000 new ones a year.
" 7 million properties that are likely to be seized by lenders have yet to hit the market,"
7 million is not an unreasonable number. Some vintages of loans have a 50 % delinquency rate;
http://ml-implode.com/staticnews/2009-0 ... tages.html
Has GOV never heard of the law of supply-and-demand? How could the bozos in DC expect the price of houses to rebound when there will be about 8 million extras? How can they expect the price of houses to rebound when the majority have no money and the [large] minority have no job?

"With that idea gaining popularity with each passing day, all that’s needed is for the U.S. to give the world an excuse to push the proverbial button. That excuse will come with the next leg down in the U.S. economy, likely triggered by the explosive collapse of commercial real estate in the first half of next year. And it won’t just be commercial that explodes but domestic real estate as well, as you can see in the chart below showing Option ARM resets:

And it’s not just the Alt-A and Option ARM resets that will bring down residential. A Bloomberg article earlier this week commented on a report about a coming wave of foreclosures by Laurie Goodman, the former head of the top-ranked research team for non-agency mortgage debt…

Sept. 23 (Bloomberg) -- The crash in U.S. home prices will probably resume because about 7 million properties that are likely to be seized by lenders have yet to hit the market, Amherst Securities Group LP analysts said.

The "huge shadow inventory," reflecting mortgages already being foreclosed upon or now delinquent and likely to be, compares with 1.27 million in 2005, the analysts led by Laurie Goodman wrote today in a report.

And the problems heading toward the multi-trillion-dollar commercial and residential real estate sectors won’t bankrupt only the property owners; the toxic-waste paper linked to those mortgages will unleash a firestorm on the portfolios of banks, pension plans, insurance companies, money market mutual funds, bond funds, etc., etc., gag, choke, hurl…

The U.S. government knows this is coming. And they know that they are firmly stuck between the anvil and the steam hammer that we here at Casey Research have been warning of since 2003 (see the May 2003 edition of our International Speculator and many articles that followed).

All that’s left at this point is for the curtain to open on the final scene, the tragic conclusion to the American empire.

Between now and then the media, most of which are ideologically in favor of President Obama – and therefore blind to the underlying economic blunders he is overseeing – are going to go all out to talk up an imminent and sustained recovery. That sets the stage for contrarians (read: “anyone with a brainâ€

[can't sit still]

Here's a mail that I received on strategic defaults;


Who walks away from mortgages?
Posted Sep 22 2009, 03:19 PM by Teresa Mears
Rating: [Poor] [Poor]
Filed under: credit, mortgage, homes, foreclosure, Teresa Mears
Conventional wisdom would seem to dictate that someone with an excellent credit score is less likely to walk away from a mortgage than someone with poor credit.
That's not so, syndicated real estate columnist Kenneth Harney writes in a story The Washington Post headlined "Good credit scores, deadbeat choices." In fact, people with excellent credit scores are 50% more likely to "strategically default" on their mortgages -- intentionally walk away -- than are lower scoring borrowers, according to a study by credit bureau Experian and consulting firm Oliver Wyman.
Harney reported these findings from the study:

* Strategic defaulters often go straight from perfect payment histories to making no mortgage payments at all.
* Strategic defaults are heavily concentrated in where home values have plummeted in recent years, such as California and Florida.
* Homeowners with large mortgage balances generally are more likely to pull the plug than those with lower balances.
* People with credit ratings in the two highest categories are far more likely to default strategically than people in lower score categories.

Harney interviewed Piyush Tantia, a principal researcher on the study, who said the homeowners with high credit scores appear to see walking away as the most practical alternative under the circumstances.
The column doesn't discuss the merits of a short sale vs. giving the lender a deed in lieu of foreclosure vs. letting the house go into foreclosure. Nor does it explore why people with excellent credit are more likely to walk away than those with poor credit.

* Bing: Help for homeowners facing foreclosure

Mike "Mish" Shedlock at Mish's Global Economic Trend Analysis has some ideas.
"The only ‘asset' many subprime borrowers have is their home,'' he wrote. "Although that asset has negative value, the homeowner may have nowhere else to go, especially if they have to put up a month's rent plus a 1-2 month security deposit in advance to rent."
In contrast, the high-scoring homeowners may have other assets and less emotional attachment to the home, plus can more easily rent another home.
"Also note the psychological factor about 'losing the only thing I ever had' for the buyers with lower credit scores," he writes.
MyBudget 360 notes that more strategic defaults are ahead in housing bubble states as option ARMs, adjustable rate and interest-only mortgages reset, confronting homeowners with higher payments on homes that aren't worth the mortgage balance.
"And you can put yourself in the shoes of someone who bought a home at the peak. Say you and your spouse bought a home in a bubble market for $500,000. Deep down, both of you felt that housing would never go down. This view was widespread. You saw for nearly 5 years homes appreciate by 10, 15, and 20 percent per year. At the very worst, you would be able to sell your home for $600,000 or $700,000 in a few years when your loan recast.
"Well, your home is now worth $250,000. It may never regain that peak value. Your payment will jump from $1,500 to $3,000. You can rent a similar place for $1,300. What do you do? Many are simply electing to walk away. In a state like California with 12.2 percent unemployment this decision might be made also by necessity. Sure, they can make the payment but how much of their budget is it eating up?"
Mark Gimein at Chumpchanger believes that walking away in that situation is absolutely the right thing to do
"In story after story about the foreclosure crisis, you will find the implicit idea that borrowers who can afford to pay their mortgage should keep on paying it no matter how much their house sinks in value because they have made a promise to pay and to do otherwise would be an abuse of the system," he writes.
"Propagating this idea is good for lenders and probably good for taxpayers, but basically, it's nonsense."
Liz Pulliam Weston notes that the decision about whether to walk away is only a moral issue if you have a choice. And she offers three key questions to ask when deciding whether to hold on to your house.
What's your take? Is it always wrong to walk away from a mortgage, even if continuing to pay will deplete your savings? What if it depletes your retirement funds as well? What if you lose your job and can only pay by running up credit card debt? What if you're divorcing or a spouse has died? Should someone continue to pay a $500,000 mortgage on a home that's now worth $250,000? Or are there times when walking away (or doing a short sale) is really the best financial decision?
And what does the fact that people with the very highest credit scores are more likely to walk away say about the credit scoring system? Or are they just showing that they are, as their scores indicate, prudent when it comes to money?

It appears that people aren't as stupid as the banks had hoped.

[can't sit still]

The Dow Jones is the part of the economy that lazy people look at. So, GOV manipulates the crap out of the DJ index. The PPT is really moving the agency stuff.

"I've written extensively about the computer trading programs that are dominating this market. All told, High Frequency Trading Programs HFTPs control 70% of trading volume on the NYSE.

However, at this point, five stocks (yes only five) account for 40% of the trading volume on the market. Those five stocks: Citigroup, CIT Group, Fannie Mae, Freddie Mac, and AIG. Think about that, five stocks out of several thousand, are accounting for 40% of ALL trading. "
http://www.silverbearcafe.com/private/09.09/crash.html

Apparently nobody is looking at earnings;
"The Wall Street Journal, on the other hand, tells us that greater than expected profits will support the rally. So far, the increase in stock prices has not come from increased earnings. It's come from increased P/Es...based on the hope of higher earnings. In terms of forecast earnings, the Dow is selling at a P/E ratio of 27. But in terms of actual, reported earnings...the ratio is 180."
Many companies are paying dividends out of their cash,,, not their earnings. Dividends from stocks are far poorer than interest on a savings account.
Basel II requirements go into effect in 2 weeks. IF the U.S. doesn't somehow sidestep the requirements, companies will have to report their true balance sheets. Corporate bond defaults are the highest in history. That might just show up in a few surprising places.
Dan

[cowboyangel]

Thanks Dan will catch up here's a deadly one....

Where has the Bailout Money Gone?

Global Research, September 27, 2009
Vanity Fair



As the Bush administration waned, the Treasury shoveled more than a quarter of a trillion dollars in tarp funds into the financial system—without restrictions, accountability, or even common sense. The authors reveal how much of it ended up in the wrong hands, doing the opposite of what was needed.



Just inside the entrance to the U.S. Treasury, on the other side of a forbidding array of guard stations and scanners that control access to the Greek Revival building, lies one of the most beautiful interior spaces in all of Washington. Ornate bronze doors open inward to a two-story-high chamber. Chandeliers line the coffered ceiling, casting a soft glow on the marble walls and richly inlaid marble floor.



In this room, starting in 1869 and for many decades thereafter, the U.S. government conducted many of its financial transactions. Bags of gold, silver, and paper currency arrived here by horse-drawn vans and were carted upstairs to the vaults. On the busy trading floor, Treasury clerks supplied commercial banks with coins and currency, exchanged old bills for new, cashed checks, redeemed savings bonds, and took in government receipts. In those days, anyone could observe all this activity firsthand—could actually witness the government and the nation’s bankers doing business. The public space where this occurred became known as the Cash Room.



Today the Cash Room is used for press conferences, ceremonial functions, and departmental parties. And that’s too bad. If Treasury still used the room as it once did, then perhaps we’d have more of a clue about what happened to the billions of dollars that flew out of Treasury to selected American banks in the waning days of the Bush administration.



Last October, Congress passed the Emergency Economic Stabilization Act of 2008, putting $700 billion into the hands of the Treasury Department to bail out the nation’s banks at a moment of vanishing credit and peak financial panic. Over the next three months, Treasury poured nearly $239 billion into 296 of the nation’s 8,000 banks. The money went to big banks. It went to small banks. It went to banks that desperately wanted the money. It went to banks that didn’t want the money at all but had been ordered by Treasury to take it anyway. It went to banks that were quite happy to accept the windfall, and used the money simply to buy other banks. Some banks received as much as $45 billion, others as little as $1.5 million. Sixty-seven percent went to eight institutions; 33 percent went to the rest. And that was just the money that went to banks. Tens of billions more went to other companies, all before Barack Obama took office. It was the largest single financial intervention by Treasury into the banking system in U.S. history.



But once the money left the building, the government lost all track of it. The Treasury Department knew where it had sent the money, but nothing about what was done with it. Did the money aid the recovery? Was it spent for the purposes Congress intended? Did it save banks from collapse? Paulson’s Treasury Department had no idea, and didn’t seem to care. It never required the banks to explain what they did with this unprecedented infusion of capital.



Exactly one year has elapsed since the onset of the financial crisis and the passage of the bailout bill. Some measure of scrutiny and control has since been imposed by the Obama administration, but even today it’s hard to walk back the cat and trace the money. Up to a point, though, it’s possible to reconstruct some of what happened in the first chaotic and crucial three months of the bailout, when Treasury was still in the hands of Henry Paulson and most of the money was disbursed. Needless to say, there is no central clearinghouse for information about the tarp money. To get details of any kind means starting with the hundreds of individual recipients, then poring over S.E.C. filings, annual reports, and other documentation—in other words, performing the standard due diligence that the government itself failed to perform. In the report that follows, we have no more than dipped a toe into the morass, but one fact emerges clearly: a lot of the money wound up in the coffers of some very surprising institutions— institutions that should have been seen as “troublingâ€

[can't sit still]

Here's some numbers from Peter Schiff;

"The US government used to finance its borrowing with 30 year paper. Now, the average maturity of national debt is under three years. That’s almost 9 trillion dollars in debt"
"Over the next year or two, you have about two trillion dollars of the adjustable low rate mortgages that are going to reset"
"And in 1980, when Ronald Reagan came in and we tried to stop the decline of the dollar which lost 2/3rd of it’s value in the 1970’s. We did it. But we did it by putting short term interest rates up to 20%.

Now, imagine what would happen to the US economy if interest rates were even half of 20%. What would the interest on the national debt be? Oh, a trillion dollars a year."

http://www.csaba.se/2009/09/26/peter-sc ... ranscript/

We don't even bother with $ billions any more. GOV pays out $ 2 trillion a year in benefits. GOV plans to borrow $ 9.8 trillion in the next several years. The Pentagon was / is missing $ 2.3 trillion. Housing lost $ 2.3 trillion in equity,, I think.
Total U.S debt is $ 11.4 trillion. The debt limit was just raised to $ 12.104 trillion. Consumer debt is $ 2.6 trillion. "Who says so? The President of the Dallas Federal Reserve, Richard W. Fisher. In a May speech at the Commonwealth Club of California, he states that the US national debt is close to $100 trillion. You can read his whole speech at the Federal Reserve web site."
http://www.lewrockwell.com/walker/walker34.html
The total possible cost of the bailouts could reach $ 23.1 trillion. What ever happened to the word "billion"?
If it's any consolation, the projected liability from GOV for a family of 4 is only $ 1.3 million.

Reportedly the derivative exposure is still $ 563 trillion. Ahh, but the dollar is collapsing. The total of contracts denominated in dollars is reported to be $ 2.6 quadrillion. I want my billions back.
Dan

[cowboyangel]

And the BIS weighs in with some scary and prophetic news....



The Economic Recovery is an Illusion by Andrew Gavin Marshall
Posted on October 3, 2009 by dandelionsalad


http://dandelionsalad.wordpress.com/

by Andrew Gavin Marshall
Featured Writer
Dandelion Salad
October 3, 2009

War is Peace, Freedom is Slavery, Ignorance is Strength, and Debt is Recovery

In light of the ever-present and unyieldingly persistent exclamations of ‘an end’ to the recession, a ‘solution’ to the crisis, and a ‘recovery’ of the economy; we must remember that we are being told this by the very same people and institutions which told us, in years past, that there was ‘nothing to worry about,’ that ‘the fundamentals are fine,’ and that there was ‘no danger’ of an economic crisis.

Why do we continue to believe the same people that have, in both statements and choices, been nothing but wrong? Who should we believe and turn to for more accurate information and analysis? Perhaps a useful source would be those at the epicenter of the crisis, in the heart of the shadowy world of central banking, at the global banking regulator, and the “most prestigious financial institution in the world,â€

[can't sit still]

Good post cowboy.
" All the money that was produced, in turn, produced debt"
Why do they insist on saying this crap. The "money" IS pure debt.

“The use of derivatives by hedge funds and the like can create large, hidden exposures."
Yup, that's why hedge funds were outlawed in 1936 by Glass-Steagal.

" Are we going into an L? I would not be in the slightest bit surprised.â€

[can't sit still]

This article is about a recent bank failure.
http://www.caseyresearch.com/displayCdd.php?id=240
It wasn't on ANY watch list. It's loss percentage was more than double the average. What the hell good is any watch list when there isn't any transparency?
The FDIC is going to get bit on the ass so often, Blair is going to have to wrap up in Kevlar.

[cowboyangel]

Of course they won't do anything that truly revamps the system. It has worked to create extraordinary wealth for this class of people, they can take a few really big hits. We can't.

When the second wave of the dip strikes, the states are going to have deal with the mess and the fallout. If taxes are raised (fat chance that will go anywhere) that will have to take care of the needs of individual states. The federal government and its trillion dollar wars and defense spending will have to go. or take a back seat to the serious issues of maintaining health and order and some shamble of an economy that will fall to the states and local governments.

This guy Tom Greco, has a great idea: http://www.tucradio.org/090701_TomGreco.mp3

and...
Steven Zarlenga
http://www.tucradio.org/090617_Zarlenga_ONE.mp3
http://www.tucradio.org/090624_Zarlenga_TWO.mp3

[can't sit still]

This is news. Reportedly the rest of the world has set a NINE year timeline for dropping the dollar. http://www.independent.co.uk/news/busin ... 98175.html
With this date on the horizon, There will be plenty of people who will dump ASAP. Big moves afoot.

[oscillator]

Read the last two sentences very carefully.

Fool me once...

[can't sit still]

"Bankers remember, of course, what happened to the last Middle East oil producer to sell its oil in euros rather than dollars. A few months after Saddam Hussein trumpeted his decision, the Americans and British invaded Iraq. "
It's true of course that Iraq went to the chopping block because of their decision to dump the dollar. The world is different now. Russia sells oil in other currencies. We might slap down Iran but,,, not Russia. Also, Russia is backing Iran with both missiles and air force. The pentagon says that we have no defense for these missiles. China and India are also backing Iran.
Ron Paul mentions that the US will collapse almost immediately if we or israel attacks Iran;
http://newsbusters.org/blogs/jeff-poor/ ... -triggered
That's why the hawks are pushing so hard for sanctions. US, GB, israel can't really afford to attack so, they have to hope for disintegration from within.
The US / israel can't do a sneak attack on Iran except with thermo-nuclear missiles. If we try to do a buildup to a conventional attack, the East can easily crash our economy.

[can't sit still]

Dougly,,, Cowboy,,, what's your projection for the stock market????
Here's some news from Mish;
"the trailing P/E on “reportedâ€

[ygmir]

yup, I'm outa the stocks......and, getting a whopping .025% on my money......but, it's "safe".........somewhat, and, hopefully.........

dang.

[can't sit still]

YGMIR, don't feel too bad. I'm not getting any interest at all. I bought silver at $ 7.50 and it just sits there,,, no interest. My brother bought gold at $ 340. Same thing,,, no interest.

[cowboyangel]

I don't know. I don't trust it anymore with all the phony fed money floating through it. Gold surpassed the magic $1000 mark yesterday, some say based on the 9 year projection of major countries sliding off the dollar reserve. No oil companies are building refineries or finding vast new fields. Shell is out of oil and into gas. Saudi Arabia's biggest field hit peak. Gotta tell you something, right?

Giving Obama the Nobel was a brilliant move. The committee knows he doesn't deserve it but gave it to him as a sort of "peace albatross" as he weighs the awful pressures to resort to war to redirect the US financial recovery like so may fool presidents and world leaders before him.

Power to the states and local government. Fed everything has let the people down and they won't stop until they stop.

[ygmir]

YGMIR, don't feel too bad. I'm not getting any interest at all. I bought silver at $ 7.50 and it just sits there,,, no interest. My brother bought gold at $ 340. Same thing,,, no interest.

I'm with ya,,,,,bought gold and silver in '99.........280 and 4.60........
but, now, it's pretty darn high, and, I'd say, to volatile for me........wish I had, had, more money and foresight in '99........

I wish I had more big propane tanks.....that's a great investment, in that it doesn't get old, and, the price is the lowest in quite a while, right now.......

CA:

I'm totally a 10th amendment supporter, so, agree with you.......

and, I feel the Peace prize was a purely, multi faceted political move......I'd no thought of the idea you have of making it harder for him to advance war planning due to the implication of the award..........

I wonder what charity he'll donate the 1.5 or whatever it is, million dollars to?.......chuckle...........

[can't sit still]

The somewhat worrying scenario right now is the tug-of-war with the US military. GOV spends 36 % of the GDP. MUCH of it goes to the military. US revenues are way down. The military is resisting cuts. They insist that they need many thousands more soldiers for Afghanistan. I read a number,,, i think that it costs $ 319,000 a year to maintain a US soldier in Pakistan. Just how much will the US military resist cutbacks?
Halfway down this page is a graph of consumer spending for the last several recessions ,,,, and for this 'recession"
http://www.leap2020.eu/GEAB-N-37-is-ava ... a3797.html
The whole world is waiting for the US consumer to manhandle the world economy out of the dumps. It's just not going to happen. Joe Average is catching on the the screw job that is our present system. The whole system is unworkable in the long term.
http://www.nolanchart.com/article5927.html
I'm expecting to military upper brass to cause big problems with the Pres.

[cowboyangel]

McCrystal's been doing that with his public pleas for more troops. If the military doesn't get cut back, they will bring us all down. They don't give a shit about that, they'll bring us down. Afghanistan helped to bring the old Soviet empire. Could happen to us too.

[cowboyangel]

and then......



A Dollar Rout Or More Bernanke Trickery? By Mike Whitney
Posted on October 12, 2009 by dandelionsalad

Bookmark and Share

Dandelion Salad

By Mike Whitney
Information Clearing House
October 12, 2009

Consumer credit is falling fast. In July, consumer credit plunged by $19 billion, followed by an August drop of $12 billion, a 5.8 percent annual rate. Credit card spending decreased by nearly $10 billion in August, while non-revolving debt, including auto loans, fell by $2 billion. Credit has shrunk for 7 consecutive months, the longest period of decline since 1991. The banks have shrugged off their commitment under the TARP program to increase lending to consumers and businesses. They’ve either deposited their excess reserves with the Fed, where they earn interest, or invested them in the equities markets for better returns. The bottom line: Credit is shrinking and the economy is slipping further into deflation.

From MarketWatch:

U.S. banks are reducing their lending at the fastest rate on record … According to weekly figures provided by the Federal Reserve, total loans at commercial banks have fallen at a 19% annual rate over the past three months, while loans to businesses have dropped at a 28% annualized pace…

… if the decline is mainly due to weak banks unable or unwilling to lend, then a turnaround in credit creation may have to wait until banks’ balance sheets are repaired, a process that could be delayed by further expected defaults in consumer loans, mortgages and commercial real-estate loans. (Rex Nutting, “Banks cutting back on loans to businessesâ€

[can't sit still]

Cowboy, that Dandelion Salad has some good writing. I bought the book, “The End of Money and the Future of Civilizationâ€

[cowboyangel]

great writing Dan! I agree with your take on gold. There's a limited supply and most of it, according to Ellen Brown, is worn around the necks of Asian and Indian women. Thanks for valuing labor. It's what really gives meaning to the whole crappy system. I'm reading Dennis LeHanne's "The Given Day" about the 1919 Boston Police Strike. It's amazing how little things really change, especially with what you call the PTB. The reason the world that controls fears labor, is because it is finally we who make things happen, and when we organize, they fear us the most. I like your reference to withholding spending as a type of "strike". Billiant! That it is indeed, a spending strike. We have our labor and we have our spending....two extremely powerful tools. We also have something the PTB don't have- community and a sense of the well being of our friends and neighbors. I am already seeing many signs of neighbors reaching out to help the foreclosed and distressed here in Marin County. There is a revolution afoot and it's all about money, oddly enough.

[ygmir]

I agree, as well........

and, a way to strike, is to barter........no records for them to peruse.....no taxes to collect......building community through trust and commerce.......

If we help eachother, we don't need "them" (PTB) to provide life's essentials, womb to the tomb..........

if we trade with eachother, we don't need their permission and oversight........

if we make our own stuff, we don't need their provisions........

if we become self reliant, and, co-operative with our neighbors, we don't need their "help"........

on and on............

[can't sit still]

Ummmm, let me expand on the idea a bit because there is a moral question. If I don't buy a lawnmower, the lawnmower guy goes broke and doesn't buy shoes. The shoe guy goes broke. On and On. I've harmed people by sitting on my cash.

The US maintained high employment with borrowed money. Borrowed money runs out eventually. So, I've harmed people who were going to get harmed eventually. It's something to think about.
After 9/11, Bush said to go out and spend money. That, right there is reason to do the opposite.

I'm starting to get a better idea of how things work. Banks create money BUT, they only create the principle,,, NOT the interest. Keynesian economics demands that expansion never stops. The interest is taken out of the new principles. The other source for interest is natural resources. US GDP expanded but wages didn't. We had to sell resources to come up with the money for the interest.

Resources gain value when they are made into something manufactured. There are very few areas in resources and manufacturing where the US is competitive.
So, as credit freezes up [no expansion], there is no new pool of principle to put work paying off previous loans. There is little resource extraction or manufacturing to pay off [create] the money for interest charges.
Western banking is a true Ponzi scheme because, it always requires new blood.

The banks gave themselves $trillions to replace the lost interest and principle. The banks have stupendous losses coming down the pipe. That's why they've cut off credit. They want to hold on to every penny.
The banks have legal obligations to their bondholders and stockholders. Hundreds of $ trillions of obligations.
Since there is no possible way to create jobs, nobody can stop the exodus of homeowners. They have NO legal obligation.

CRE in Tokyo dropped to 1% of bubble price,,, permanently.
The main thing to remember is that the borrowed money is drying up rapidly. The only way that the banks can remain nominally solvent is to receive hundreds of $ trillions from the FED. The more that the FED prints, the more interest bond buyers demand.

The FED said that they plan to keep interest rates for FED funds at .25% indefinitely. Imagine of they borrow at 14 % and loan at .25 %

[cowboyangel]

I heard an interesting commercial on KGO radio today. It was a Farmers Insurance ad. It said something like, "Farmers. a responsible company that doesn't invest in "junk bonds" or "derivatives"...that part was definitely in the ad. Are some companies getting it? Seems so.

[Ugly Dougly]

Dow tops 10,000 today.
Glass half full or half empty?
The choice of perspective is yours.