Tag Archives: Federal Reserve Bank

Chicago Tribune: National debt – National voices – MercedSun-Star.com

Decades or centuries from now, scholars will examine U.S. government documents from our time and notice something strange: In four consecutive years around the close of the 20th century, the federal budget was recorded as having a surplus. That hadn’t happened since 1969, it hasn’t happened since, and the way things are going, it may never happen again.

Recent years have seen the collapse of all federal fiscal discipline. At the end of the 2001 fiscal year, the national debt stood at $5.7 trillion. Today, it’s over $12 trillion. With the population at roughly 300 million, your share is, oh, about $40,000. And you ain’t seen nothin’ yet. In the next decade, according to the Obama administration’s own estimates, Washington will pile up another $9 trillion in deficits. …

It’s a crisis that grew gradually for years and is now growing rapidly. It’s one that will force Americans to choose between getting our fiscal house in order or inviting an economic decline of the sort we associate with banana republics. And it’s one that demands action sooner rather than later.

via Chicago Tribune: National debt – National voices – MercedSun-Star.com.

via Chicago Tribune: National debt – National voices – MercedSun-Star.com.


McCain and Cantwell Want a New Glass-Steagall Law | Newsweek Voices – Michael Hirsh | Newsweek.com

The blinding complexity and interconnections created by modern capital markets—especially because of the way nearly half a trillion dollars in derivatives trades linked the firms to each other—demanded that there be strong firewalls and capital buffers between Wall Street institutions and their affiliates, and between banks and nonbanks and insurance companies. Otherwise there would be no islands of safety—no healthy institutions left to come and rescue the day, as commercial banks traditionally had done since the days of J. P. Morgans famous bailout in 1907. The repeal of Glass-Steagall took things in precisely the opposite direction, eliminating most of the firewalls and inviting staid commercial banks into the buccaneering world of Wall Street trading. Representative Hinchey says it “was a recipe for disaster because these banks were empowered to make large bets with depositors money, and money they didnt really have. When many of those bets, particularly in the housing sector, didnt pan out, the whole deck of cards came crumbling down and U.S. taxpayers had to come to the rescue.”Today the walls between firms still seem low indeed, and trading in derivatives that are “over the counter” that is, out of public sight continues at an astonishing pace, having risen back up to nearly $600 trillion worth. One big danger sign ahead is that the biggest banks have gotten even bigger in the aftermath of the catastrophe, and under the new rules requiring swap dealers to post capital for margin requirements, the big banks are likely to monopolize even more of this derivatives market and become that much richer and more powerful.

via McCain and Cantwell Want a New Glass-Steagall Law | Newsweek Voices – Michael Hirsh | Newsweek.com.

via McCain and Cantwell Want a New Glass-Steagall Law | Newsweek Voices – Michael Hirsh | Newsweek.com.

Strange coalition targets Ben Bernanke – – POLITICO.com

Very interesting development here.

“There’s a strange political cocktail brewing in Washington, one that mixes top conservative strategist Grover Norquist and tea party organizers at FreedomWorks with democratic socialist Sen. Bernie Sanders I-Vt., progressive activists and public interest advocates.The unlikely coalition’s bid to block Ben Bernanke’s nomination to a second term as chairman of the Federal Reserve until Congress votes on legislation to audit the secretive central bank is tapping into a growing anti-establishment mood — and legislators up for reelection next year are taking notice.The Fed fighters’ charge that the White House favored Wall Street over the public interest during the financial crisis appeals to a lot of people these days. Average voters resent the government’s response to the market meltdown — the $700 billion Troubled Asset Relief Program, the auto industry bailout and the trillions doled out by the Federal Reserve — because it hasn’t seemed to help them out, as the national debt has soared and the unemployment rate has moved north of 10 percent. It’s a populist anger that goes far beyond traditional definitions to include, as one analyst noted, people living in gated communities in Florida.“They look at Wall Street, and they say, ‘Who’s been held accountable? Anybody going to jail? No? These guys are actually getting huge bonuses,’” said Sanders, whose campaign to block Bernanke has been embraced by progressive and conservative groups alike.“Bernanke represents the status quo. People want a change in the way Wall Street functions; they want a change in the way the Fed functions,” Sanders said.”

<p>via <a href=”http://www.politico.com/news/stories/1209/30278.html&#8221; mce_href=”http://www.politico.com/news/stories/1209/30278.html”>Strange coalition targets Ben Bernanke – – POLITICO.com</a>.</p>

via Strange coalition targets Ben Bernanke – – POLITICO.com.