Monday, July 14, 2008

Is Your Bank the Next to Collapse?

This a question that needs to be asked. How safe is our banking system? We know they are insured for the first $100,000. But can we really trust the banks and the government? They've been lying and cheating us for so long how can we trust them. On the hand a panic would be the worst thing that could happen. If the government and big business don't come together to solve the crisis panic will eventually set in.

Even as the Bush administration moved to rescue the nation’s two largest mortgage finance companies, confidence in the banking sector spiraled downward Monday.

In Southern California, lines snaked around branches of IndyMac Bancorp, the large lender that was seized by federal regulators on Friday, as customers hurried to withdraw their money. As the anxiety spread through the financial markets, two other big banks, one in Ohio and another in Washington State, were compelled to assert that they were sound.

Rumors lead to panic. The greatest rumor mongers are the speculators. And its the speculator that have gotten us into this mess:
Bank stocks swooned again Monday as rumors flew around trading desks about which bank would be the next to be taken out.

But wait a minute Weren't we reassured on Sunday that the Securities and Exchange Commission was going to try to put a stop to rumormongering on Wall Street?

Turn up the laugh track, please.

Rumors are as much a part of trading culture as spitting is a part of Major League Baseball. And like insider trading, intent is difficult to prove. One trader's rumor is another trader's conventional wisdom, and it doesn't take long for sentiment to grab hold, particularly when the slightest inkling of news is picked up and repeated ad nauseum on cable television.

Even as federal regulators issued assurances that depositors’ savings were safe, Wall Street analysts circulated lists of lenders that might be vulnerable. Shares of regional banks plunged in one of the sharpest declines since the 1980s.

[...]Regulators and investors are bracing for a small number of banks to fail over the next 12 to 18 months. Analysts predict that 50 to 150 banks might stumble. In the first quarter this year, the F.D.I.C. listed 90 banks as troubled, which is far lower than the levels during the savings and loan crisis of the 1980s. Still, Ms. Bair said that number would increase. IndyMac, for example, was not on that first quarter list at the F.D.I.C. but was still seized by regulators.

And it is the speculators that helping to drive up food prices:
The massive inflow of speculative funds into commodity markets is playing a big part in driving prices of oil and food higher, harming the world's economic growth and the lives of the most vulnerable, an annual government report said Tuesday.

This is the first time that the industry ministry's white paper on international economy and trade has provided a detailed analysis of soaring oil and food prices, officials said.

[...] "Therefore, it is believed that the inflow of speculative money, comprising pension funds and hedge funds, is also having a big influence," it said.

In the wake of the U.S. subprime lending crisis, the report said global investors seeking safer returns are pouring money heavily into commodities as a hedge against flagging stocks and the U.S. dollar.

The paper said that the futures price of corn in Chicago was $6 per bushel as of May this year, only about half of which was explainable by the supply and demand balance.

New Yorker Magazine Cover Shows Obama and Wife as al Qaeda Terrorists

This sort of thing is expected of a right-wing publication [see picture]. The New Yorker is a leftist magazine. They claim it is an attempt to satirize the anti-Obama elements out there. The problem is that there is no article accompanying the cover to give it context. It could easily be seen as an attack. The main purpose of this outrage is to get publicity for a magazine that is seeing it's profits collapsing.

The New Yorker says it's satire. It certainly will be candy for cable news.

At a press availability Sunday afternoon in San Diego, Senator Obama was asked, according to the diligent Maria Gavrilovic of CBS News: "The upcoming issue of the New Yorker, the July 21st issue, has a picture of you, depicting you and your wife on the cover. Have you seen it? If not, I can show it to you on my computer. It shows your wife Michelle with an Afro and an AK 47 and the two of you doing the fist bump with you in a sort of turban-type thing on top. I wondered if you've seen it or if you want to see it or if you have a response to it?"

Obama (shrugs incredulously): "I have no response to that."

Afghanistan: The New Pre-Surge Iraq

It is was predictable. Afghanistan had been ignored for years. Now the situation has worsened dramatically. A two front war could not be sustained. That was the mistake we made in Vietnam/Laos/Cambodia. It didn't work then it won't work now. This is mess that will eventually mean troops in Pakistan. The Bush administration is inattentive. They busy trying to start a war with Iran.

Taliban insurgents carried out a bold assault on a remote base near the border with Pakistan on Sunday, NATO reported, and a senior American military official said nine American soldiers were killed.

The attack, the worst against Americans in Afghanistan in three years, illustrated the growing threat of Taliban militants and their associates, who in recent months have made Afghanistan a far deadlier war zone for American-led forces than Iraq.

[...] The militants have since regained strength in the tribal areas of Pakistan, which they have often used as a base for raids into Afghanistan, an increasingly sore point for the American and Afghan governments.

The new American commander of NATO forces in Afghanistan emphasized that issue on Sunday in an interview that took place before details of the Kunar attack were disclosed, asserting that the militants were not only entering Afghan territory but also firing at targets from the Pakistan side.

“It all goes back to the problem set that there are sanctuaries in the tribal areas that militant insurgent groups are able to operate from with impunity,” said the commander, Gen. David D. McKiernan, who took over the NATO-led International Security Assistance Force in June.

The quagmire will extend into the next administration. Mr.Obama will get us into the mess deeper because he needs to prove something and keep his promises made during the campaign. He lacks the expertise to get us out. He needs some advisers or running mate who really understands what is going on and won't play political games.
Senator Barack Obama is proposing that the United States deploy about 10,000 more troops to battle resurgent forces in Afghanistan, a plan intended to shift the American military focus from the Iraq war to the marked rise in violence from the Taliban.

“As president, I would pursue a new strategy, and begin by providing at least two additional combat brigades to support our effort in Afghanistan,” Mr. Obama, the presumptive Democratic nominee, wrote in an Op-Ed article published on Monday in The New York Times. “We need more troops, more helicopters, better intelligence-gathering and more nonmilitary assistance to accomplish the mission there.”

Mr. Obama, who is among those who maintain that Afghanistan has been neglected because of the administration’s Iraq policy, has not previously offered such a specific plan for how to strengthen troop levels in Afghanistan. His proposal comes as he prepares to visit American commanders to assess progress in Iraq and needs in Afghanistan.

You need further proof that Obama is attempting to establish his foreign policy bona fide:
Democratic presidential candidate Sen. Barack Obama will be visiting the Palestinian Authority president in the West Bank next week, a Palestinian government official said Monday.

Obama will be meeting with President Mahmoud Abbas in Ramallah on July 23, Palestinian negotiator Saeb Erakat said.

Obama is expected to visit Israel, but officials could not yet confirm what his plans are there. Erakat was in Paris, France, where Abbas had been attending a summit.

This visit would be a dangerous and unnecessary stunt. It gives an opportunity for the extremists to assassinate him.