Wall Street Meltdown
Washington, DC, Sep 14th, 2008 -- The consequences of complete mismanagement of the economy, coupled with no effective regulation, corruption and runaway spending on an endless war has brought Wall Street to the brink of meltdown tonight and effectively the collapse of 3 out of 5 of America's leading Banks, on the heels of NATIONALIZATION of Fannie Mae and Freddie Mac by a right wing Republican government. To save the country plunging into Depression the Republicans will have been forced to adopt even more socialist government methods.
That is the impossible situation Sunday night as the political and financial intelligence feeds are in overdrive. The majority of the American electorate of course will still be focused on Palin's one liners, Lipstick and Pit Bulls. Dire warnings for many years have been dismissed as Conspiracy Theories.
The American Dream of a better life is turning into a Nightmare for tens of millions. The corruption of recent years is coming home to roost.
From our own analysis the private sector has not the ability to correct the financial imbalance, or come up with the liquidity to stop the collapse without the help of the taxpayer. The NeoCon Republicans have failed miserably. The free market, free wheeling system of Reagan and the Bush's has collapsed. Despite what Cindy McCain says having 10 houses is a matter that has to be discussed in the election. The next President needs to understand the real financial plight of tens of millions of voters under threat.
At the base of this "Get Rich Quick" pyramid was a conspiracy of bloated house prices, builders, agents and banks willing to write loans for 100%, 110% even 120% of the grossly inflated valuation of the property. Mortgages were moved around, switched, chopped, diced and massaged, then put back on the market for greedy Wealth Managers to sell to their clients at high commissions. The huge profits made for greed beyond belief.
The housing market is nowhere near the bottom of it's downward spiral, and the American Financial Market will never be the same. What is needed now is firm leadership before this collapse gets out of control and we end up with a Depression, not a mild Recession. The cutsie electioneering by both Candidates needs to stop tomorrow, and the focus needs to move from John McCain's prison cell of thirty years ago to the crashing economy of today. I am not sure a former beauty queen, mayor of a small town in the wilderness, who wants to attack Russia should be a heartbeat away from having to deal with a situation where bad policies could spell disaster.
The electorate in the US is easily led with often fraudulent TV commercials. Few understand the serious nature of the financial meltdown. Fortunately Hurricane Hanna and Ike did not seriously damage the Oil platforms, a massive collapse of the energy market would be a perfect storm.
The future of America is now in the hands of the Chinese, Arabs and European Banks. The cost of the bailout may be the transfer of even more wealth to the Middle East, despite what T Boone Pickens and other right wing politicians may desire. As regards Israel, with absolutely no ability to assist the US, the Arabs and Oil producers with the investment money may insist on a less vocal rhetoric and military aggression towards the region.
The next few hours will dictate the direction of American business, and consumer credit for years to come. One thing is certain, there will be major pain for many at the bottom end of the financial food chain, the Middle Class borrower.
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