Where is the US economy headed?

@realjohnboy,

realjohnboy wrote:

And we talked before (I think it was when the stress tests results came out) about how the banks are not making the bookkeeping entry to increase their loss reserves.

I just found this AP story from less than an hour ago quoting the U.S. Office of Thrift Supervision, which oversees non-bank institutions (S&Ls, Credit Unions, perhaps). Losses in the 1st Q of 2009 fell to a mere $47M from $5.4B in the 4th Q of 2008. Whoop-de-do. Break out the bonuses for the brilliant executives! But in the 1st Q they set aside $3.5B less in increases to their loss reserves despite declining loan quality. Clever guys, as that undercharging the 1st Q by at least $3.5B or so covers up a 1st Q almost as bad as the 4th.
OTS says there are 31 "problem" thrifts up from 26 a Q ago.

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@cicerone imposter,

CI, I fully agree with you, and am even more pessimistic than you are.

Maybe you should push for the earliest possible amnesty for illegals. That way, the employers could save a lot of money on wages and benefits, which, of course, would be passed on to the current employees. Any amnesty would, of course, be a signal for future waves of illegals who would expect to benefit from a future amnesty. It is a can't miss synergistic solution to our economic problems. Being an unrelenting supporter of illegals and amnesty, you would certainly get some type of credit for this result.

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@Advocate,

I don't "push" on anything that's not on our state ballot. On the state propositions last month, I voted "no" on all of them. Sacramento is trying to play numbers games with higher taxes rather than making the tough decisions to live within their means. They're going to see all "no's" from me on any state proposition that has anything to do with the budget with the exception of their cutting spending.

They still don't "get it." They want to give pink slips to only 5,000 of the state workers out of 230,000. They still don't have it right while staring at a budget deficit of $24 billion and increasing.

Those clowns in Sacramento can't even get the budget approved on time.

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@cicerone imposter,

It might not be that they are clowns ci. It might be the contradictions they are trying to smooth out i.e. you lot. It could just be that you are impossible.

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Unemployment rate looks to climb, May's results to be announced soon will probably be over 9%, maybe 9.1 or 9.2 or ? Meanwhile, rumblings of more shoes to drop with property loan defaults?

http://forecasts.org/images/leading-indicator/unemploy.gif

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Am I reading that correctly , Okie? Was unemployment at 5 Percent in January and scheduled to be near 11% in November?

Is this the "change" Obama campaigned on?

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@genoves,

Yes, change you can believe in. Please note about May when Obama turned the corner on Hillary, he more or less locked up the nomination, then November, then January of 09, thats when the numbers really got a boost, things were looking up for Obama, the higher the better for his numbers. The higher unemployment goes, the higher his approval ratings. After all, it worked for FDR, didn't it?

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Now, here's a way to help pay for the programs we've suddenly decided we need. One problem; The government seems to think keeping banks under its control is more important than letting - LETTING !- them repay back loans that many of them didn't need, or really want.

http://online.wsj.com/article/SB124388663921173479.html#mod=djemalertNEWS<br />

"Banks Sell Shares in Bid to Flee Fed

J.P. Morgan Chase & Co. and American Express Co. announced unexpected plans to sell stock after the government said large banks must first prove they can raise money from private investors before exiting the federal bailout program."

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@roger,

roger wrote:

Now, here's a way to help pay for the programs we've suddenly decided we need. One problem; The government seems to think keeping banks under its control is more important than letting - LETTING !- them repay back loans that many of them didn't need, or really want.

http://online.wsj.com/article/SB124388663921173479.html#mod=djemalertNEWS<br />

"Banks Sell Shares in Bid to Flee Fed

J.P. Morgan Chase & Co. and American Express Co. announced unexpected plans to sell stock after the government said large banks must first prove they can raise money from private investors before exiting the federal bailout program."

You probably shouldn't go to the WSJ for impartial news on anything related to Wall Street, especially when Obama is involved.

I hope you realize that these banks have engaged in amazing financial trickery in order to keep from posting their losses, and now that it looks like they are going to get away with it, want to back out from the obligations they incurred when they came crawling to us for help. They certainly don't treat their clients that way; why do they expect to be treated that way?

Cycloptichorn

1 Reply

@Cycloptichorn,

From what I understand, many banks did not come crawling for help, they were told to ask for help, or else.

1 Reply

@okie,

okie wrote:

From what I understand, many banks did not come crawling for help, they were told to ask for help, or else.

And who told you that? The banks themselves? You don't seem to realize that the US government gave them ALL billions of dollars when we funded AIG's Credit-default swap obligations. They are ALL in hock to us for helping them out. Without those credit-default swaps, they all would have failed.

So, pardon me if I'm not too sympathetic to their worries now, sheesh

Cycloptichorn

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@Cycloptichorn,

I seem to remember watching Hank Paulson saying words to the effect that okie suggested. I'm not postive but it was the unusual and unexpected nature of his comments at that time which might have struck me forcibly enough for me to have retained a memory of them.

I tend to easily forget the bland stuff.

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@spendius,

spendius wrote:

I seem to remember watching Hank Paulson saying words to the effect that okie suggested. I'm not postive but it was the unusual and unexpected nature of his comments at that time which might have struck me forcibly enough for me to have retained a memory of them.

I tend to easily forget the bland stuff.

Paulson, a slimy **** if there ever was one, may have said that; and it may even be accurate, in reference to the original TARP deal. But that's not what I'm talking about.

I'm talking about the fact that every Credit Default Swap that was paid to these organizations - and this is separate from the 'tarp' money they received - came straight from taxpayer pockets. All that money to 'bail out' AIG went straight to these banks. So for them to claim that we forced them to take the money is a ******* joke, they couldn't wait to get their hands on taxpayer money.

Cycloptichorn

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I may have it wrong but I had the impression that government control of banking had become necessary in view of the risks if banking was left in the hands of free-thinking, entreprenurial loose cannons in charge of vast funds of electronic moolah with or without supervision.

Selling the idea to a free-thinking entreprenurial population was a piece of piss.

You have just seen it done.

1 Reply

@spendius,

spendius wrote:

I may have it wrong but I had the impression that government control of banking had become necessary in view of the risks if banking was left in the hands of free-thinking, entreprenurial loose cannons in charge of vast funds of electronic moolah with or without supervision.

Selling the idea to a free-thinking entreprenurial population was a piece of piss.

You have just seen it done.

Well, that's my opinion. But not the official US government one.

Cycloptichorn

1 Reply

@Cycloptichorn,

You are equating ALL banks to the worst banks. Some would have gone under without help, and maybe they should have. Some were doing just fine, and that includes JP Morgan Chase.

WSJ is not a valid source? Now, get real.

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@Cycloptichorn,

I go on what's happening Cyclo. Not on "official positions". The latter are changing here hour by hour.

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@roger,

roger wrote:

You are equating ALL banks to the worst banks. Some would have gone under without help, and maybe they should have. Some were doing just fine, and that includes JP Morgan Chase.

WSJ is not a valid source? Now, get real.

Sorry; they are extremely pro-big business biased. It is a good source of news data but not one for an unbiased opinion. You will never see them doing anything but cheering on that which makes the most money for the rich.

And that goes double since Murdoch took over.

Cycloptichorn

1 Reply

@Cycloptichorn,

okie wrote:

Quote:

From what I understand, many banks did not come crawling for help, they were told to ask for help, or else.

Cyclo wrote:

Quote:

And who told you that? The banks themselves? You don't seem to realize that the US government gave them ALL billions of dollars when we funded AIG's Credit-default swap obligations. They are ALL in hock to us for helping them out. Without those credit-default swaps, they all would have failed.

Not only did the US government bailout help all banks as you described, but also helped foreign banks insured by AIG. US tax dollars helping foreign banks and their investors.

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@cicerone imposter,

Quote:

Not only did the US government bailout help all banks as you described, but also helped foreign banks insured by AIG. US tax dollars helping foreign banks and their investors.

$100+ billion has already been sent to foreign banks through AIG's accounts, plus the US taxpayers have guerenteed trillions of dollars more of AIG's contracts with foreign banks. Bondholders in GM are getting ten cents on the dollar IN STOCK THAT MAY TURN OUT TO BE WORTHLESS and yet AIG's trading partners are getting $1 on the $1. It is criminal.

1 Reply

Where is the US economy headed?

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