Harry S. Dent Jr., president of the H.S. Dent Foundation, an investment research group, thinks the U.S. is not far behind, with unsettling consequences for the financial markets.
"A major economic slowdown will occur in North America and Europe from 2010 into 2020-2024 that will be marked by a series of dramatic stock crashes" and declining rates of consumer spending, he predicted.
This is an interesting quote from an article in The Washington Times, dated July 10, 2007.
CAPITAL REGION Taxpayers voicing concerns to their representatives BY MICHAEL LAMENDOLA Gazette Reporter
Capital Region residents are bombarding elected representatives in Washington and telling local candidates running for Congress they do not support the current Wall Street bailout plan, saying they want accountability in return for providing $700 billion in taxpayer money. “We have received hundreds of calls and e-mails from people on this issue,” said Jess Fassler, chief of staff for Rep. Kirsten Gillibrand, D-Hudson. He termed the volume of correspondence above normal. “Folks are very concerned and they want to make sure it is not a misuse of taxpayer money. People are really paying attention,” Fassler said. Gillibrand said the bailout package has no accountability, no oversight and does not protect the taxpayers. “It does more for Wall Street than Main Street. My number one priority is to protect the taxpayer, and I do not want upstate New York families paying the price for the greed and excesses of Wall Street,” she said. Alexander “Sandy” Treadwell, a Republican challenging Gillibrand for the 20th Congressional District seat, did not return a phone call. Spokesmen for Sen. Hillary Rodham Clinton and Sen. Charles Schumer, both D-N.Y., also report their offices receiving a high volume of calls. Schumer spokeswoman Deirdre Murphy said “New Yorkers ... want to make sure that the legislation being hammered out in Congress includes protections for taxpayers and homeowners, reforms this broken system and ensures that there is oversight. Senator Schumer is working day and night to make sure this happens.” Candidates seeking the open seat in the 21st Congressional District are hearing similar concerns, they said. “Some people are worried about the bailout plan because it is happening too fast,” said Beau Duffy, spokesman for candidate Paul Tonko, a Democrat. “They are nervous about it and are asking why should they have to pay to bail these people out,” Duffy said. Jim Buhrmaster, Republican candidate for the 21st District, said people he has talked to want to hold accountable the CEOs of the firms responsible for the meltdown in financial markets. “They do not want to go on protecting these people who have been in charge, who allowed it to happen and who had knowledge it would happen,” Buhrmaster said. “They need to be held accountable. That is the least we should expect from them.” Buhrmaster said he has also heard from the local banking community. His family is associated with First National Bank of Scotia. He said small banks are worried the government will come up with a plan that will hurt them. “We stand by the small community banks and we want to make sure they are held harmless,” Buhrmaster said. Public concerns with the bailout plan appear to cross party lines. Two residents of the Capital Region, Debra Dodd of Glenville, a self-described “anti-Bush” liberal Democrat, and Bill Zilberman of Niskayuna, a Conservative, said they oppose the initially proposed bailout plan, but for different reasons. Dodd called the plan a travesty. “I am alarmed as a citizen. I don’t want them to vote for the bailout as it is.” Added Dodd: “I feel it feeds the greed of Wall street. Unless changes are made, the only people who will suffer are my generation and my children.” Dodd said the current plan gives too much power to Treasury Secretary Henry M. Paulson Jr. and does not do enough to punish the leaders of failed Wall Street companies. “A lot of the CEOs who ran their companies into the ground already made their millions. They should be made to pay it back,” she said. Zilberman said he sees injustice in the current plan. “On the face of it, it strikes me as wrong. It is our money. If people mismanage companies, I don’t understand why we have to bail them out, especially when they get millions of dollars in compensation.”
Bush rallies support for bailout bill Congressional leaders are close to an agreement BY JULIE HIRSCHFELD DAVIS AND DAVID ESPO The Associated Press
WASHINGTON — President Bush summoned Barack Obama, John McCain and legislative leaders to an extraordinary White House summit, warning Americans and Congress on Wednesday night that failing to act on a $700 billion financial industry bailout could lead to “a long and painful recession.” Earlier, Bush bowed to Democratic demands to limit the pay of executives whose tottering companies would be rescued. Democrats and Republicans were nearing agreement on the rescue legislation, the most sweeping government intervention in the market since the Great Depression, and set a meeting early today to draft a bipartisan bill. Bush acknowledged in a prime time television address Wednesday night that the bailout would be a “tough vote” for lawmakers. The president’s dire warning came not long after he invited Obama and McCain, one of whom will likely inherit the economic mess in four months, as well as key congressional leaders to a White House meeting today to work on a compromise. The administration appeared to be softening its resistance to Democrats’ demand that the eyepopping cost be phased in rather than dispensed all at once. But Bush strongly urged Congress to act quickly to pass the plan, warning Americans in his 12-minute speech that failing to act fast risked dire economic consequences such as disappearing retirement savings, rising foreclosures, lost jobs and closed businesses. “Without immediate action by Congress, America could slip into a financial panic and a distressing scenario would unfold,” Bush said as he worked to resurrect the unpopular bailout package. With the administration’s original proposal considered dead in Congress, top House leaders issued an upbeat statement late Wednesday saying there was progress toward revised legislation that could pass. “We are committed to continuing to work cooperatively and on a bipartisan basis to safeguard the interests of the American taxpayers,” said Speaker Nancy Pelosi, D-Calif., and House Republican leader John Boehner of Ohio. Sen. Dick Durbin of Illinois, the Senate’s No. 2 Democrat, expressed optimism that Congress could work through the weekend and pass the measure, possibly by the time markets open on Monday. The heart of the unprecedented plan, unveiled less than a week ago, involves the government buying up sour assets of shaky financial firms in a bid to keep them from going under and to stave off a potentially severe recession. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke spent most of the day at the Capitol, shuttling between public hearings on the proposal and private meetings with lawmakers. In their statement, Pelosi and Boehner said, “We agree that key changes should be made to the administration’s initial proposal. It must include basic good-government principles, including rigorous and independent oversight, strong executive compensation standards and protections for taxpayers.” Earlier, Paulson agreed to demands from critics in both parties to limit the pay packages of Wall Street executives whose companies would benefit from the proposed bailout. “The American people are angry about executive compensation and rightfully so,” Paulson told the House Financial Services Committee. “We must find a way to address this in the legislation without undermining the effectiveness of the program.” The administration and congressional negotiators also were nearing accord on parceling out the $700 billion so it would not be available all at once, although key details remained to be worked out. “Ultimately $700 billion has to be available but … they are making progress about how to give people some assurance that it is not going to go to $700 billion in one fell swoop,” said Rep. Barney Frank, D-Mass., who was leading negotiations with Paulson on the plan. Paulson also was said to have accepted the idea of allowing the government to take an equity stake in some of the companies aided — rather than just purchasing their bad assets, as Bush originally proposed — but there was no agreement yet on how the plan would work. Given the progress on the talks, Frank said the White House summit would be relegated to little more than a publicity event. “We’re going to have to interrupt a negotiating session tomorrow between the Democrats and Republicans on a bill where I think we are getting pretty close and troop down to the White House for their photo op,” Frank said. “I wish they’d checked with us.”
LAWRENCE JACKSON/ THE ASSOCIATED PRESS President Bush is seen at the White House after delivering a prime-time speech Wednesday on the ailing financial markets.
Congress draws the line First published: Thursday, September 25, 2008
No, the need for the federal government to come in and bail out Wall Street by buying up its most troubled assets won't be an act of capitulation. Congress isn't about to blurt out its collective ayes first and consider the consequences later. This won't be a $700 billion version of the Patriot Act. A financial crisis for the ages does have its upside.
Browbeating by the likes of Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, let alone Vice President Dick Cheney, isn't enough to win approval for a bailout on the White House's terms.
They've learned their history, albeit the hard way, on Capitol Hill. Listen, for example, to how Rep. Gene Taylor, D-Miss., is responding to warnings of how the economy will collapse altogether unless Congress acts immediately.
"Where have I heard this before?" he asks. " 'The Iraqis have weapons of mass destruction, and they're ready to use them.' I'm in no rush to do this.''
What's happened?
Well, no one, of either party, seems to want to be running for re-election this fall as the senator or congressman who trusted Wall Street to the tune of precariously close to $1 trillion. A blank check for the very people who created financial ruin would be a huge political liability — in much the same way that the blind surrender of civil liberties should have been six years ago.
It's for sound economic reasons, though, and not just political expedience that Congress has demanded, and Mr. Paulson has accepted, that any bailout meet certain conditions. The chief executives of the companies that benefit from what's in essence corporate socialism won't be able to collect the multimillion dollar bonuses and severance packages that have become commonplace on Wall Street.
That's progress. Compensation levels that rewarded top executives for failure as well as for success was a big reason why some sort of bailout is necessary in the first place.
So where do the aggrieved parties, at least as they perceive themselves, turn now that even the Bush administration is seeing the light?
"It is not appropriate for government to be setting the salaries of executives,'' protests Scott Talbott of the trade group known as the Financial Services Roundtable.
But what is appropriate, normal or otherwise tolerable about a financial services industry that needs the government's help to keep functioning? The axiom of no free lunch applies to the bailout buffet, too.
The debate now shifts to winning over not only Congress, but also a public that has no interest in anything that would further widen the gap between the super-rich and the rest of us. That was President Bush's task on Wednesday night, trying to reassure ordinary Americans that it's in their interests to support a bailout, however distasteful that might seem.
There are other ways to bring Wall Street back to life, though. Almost all of them would involve a greater role for the government — giving it equity in the companies it's rescuing, for example, or having the government give the financial system the equivalent of a cash transfusion without taking on any of the bad debt.
Thanks to the insistence of Congress, for a welcome change, the debate goes on.
The Issue:
The White House won't get its financial bailout without negotiation.
The baby boomers (my generation) has just placed a huge debt on the 30 somethings out there to pay for our financial security. What the boomers created, the next generation (our kids) will have to pay for. Not a very good inheritance for them.
Barack Obama's Fannie Mae/Freddie Mac Connection Tuesday, September 16, 2008
By John Gibson
Lehman Brothers collapse is traced back to Fannie Mae and Freddie Mac, the two big mortgage banks that got a federal bailout a few weeks ago.
Freddie and Fannie used huge lobbying budgets and political contributions to keep regulators off their backs.
A group called the Center for Responsive Politics keeps track of which politicians get Fannie and Freddie political contributions. The top three U.S. senators getting big Fannie and Freddie political bucks were Democrats and No. 2 is Sen. Barack Obama.
Now remember, he's only been in the Senate four years, but he still managed to grab the No. 2 spot ahead of John Kerry — decades in the Senate — and Chris Dodd, who is chairman of the Senate Banking Committee.
Fannie and Freddie have been creations of the congressional Democrats and the Clinton White House, designed to make mortgages available to more people and, as it turns out, some people who couldn't afford them.
Fannie and Freddie have also been places for big Washington Democrats to go to work in the semi-private sector and pocket millions. The Clinton administration's White House Budget Director Franklin Raines ran Fannie and collected $50 million. Jamie Gorelick — Clinton Justice Department official — worked for Fannie and took home $26 million. Big Democrat Jim Johnson, recently on Obama's VP search committee, has hauled in millions from his Fannie Mae CEO job
Now remember: Obama's ads and stump speeches attack McCain and Republican policies for the current financial turmoil. It is demonstrably not Republican policy and worse, it appears the man attacking McCain — Sen. Obama — was at the head of the line when the piggies lined up at the Fannie and Freddie trough for campaign bucks.
Sen. Barack Obama: No. 2 on the Fannie/Freddie list of favored politicians after just four short years in the Senate.
Next time you see that ad, you might notice he fails to mention that part of the Fannie and Freddie problem.
McCain aide's ties to Freddie Mac eyed Updated 9h 12m ago
USA TODAY's interactive campaign finance tracker lets you examine and filter donations by state, date, amount and sector.
USA TODAY
WASHINGTON — Democrat Barack Obama's campaign on Wednesday demanded an accounting of work done by a lobbying firm founded by Republican John McCain's campaign manager for Freddie Mac-
The New York Times reported that lobbying firm Davis Manafort received $15,000 a month from Freddie Mac, a central player in the crisis affecting Wall Street, from the end of 2005 through last month. The company was founded by Rick Davis, who left the firm in late 2006 to run McCain's campaign.
The payments to Davis Manafort are on top of more than $30,000 a month that went directly to Davis for five years starting in 2000. That money came from Freddie Mac and Fannie Mae as part of the Homeownership Alliance, an advocacy group that Davis headed
Obama grant being probed $100,000 DEAL | State to charity: What happened to garden money, other cash? Recommend (231) Comments
September 25, 2008
BY CHRIS FUSCO AND DAVE MCKINNEY Obama's $100K Grant for a Garden Never Built
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A group headed gy Kenny B. Smith (top right) was awarded a state grant by then-state Sen. Barack Obama to create a botanic garden in Englewood. Plans now call for the city to take back the garden site because the project never happened. Attorney General Lisa Madigan is investigating. (Keith Hale/Sun-Times/AP)
RELATED STORIES Video: Grant for a garden never built Exclusive: Obama's $100K (unbuilt )garden Special section: Barack Obama More in Watchdogs
A $100,000 state grant for a botanic garden in Englewood that then-state Sen. Barack Obama awarded in 2001 to a group headed by a onetime campaign volunteer is now under investigation by the Illinois attorney general amid new questions, prompted by Chicago Sun-Times reports, about whether the money might have been misspent.
The garden was never built. And now state records obtained by the Sun-Times show $65,000 of the grant money went to the wife of Kenny B. Smith, the Obama 2000 congressional campaign volunteer who heads the Chicago Better Housing Association, which was in charge of the project for the blighted South Side neighborhood.
Smith wrote another $20,000 in grant-related checks to K.D. Contractors, a construction company that his wife, Karen D. Smith, created five months after work on the garden was supposed to have begun, records show. K.D. is no longer in business.
Attorney General Lisa Madigan -- a Democrat who is supporting Obama's presidential bid -- is investigating "whether this charitable organization properly used its charitable assets, including the state funds it received," Cara Smith, Madigan's deputy chief of staff, said Wednesday.
In addition to the 2001 grant that Obama directed to the housing association as a "member initiative," the not-for-profit group got a separate $20,000 state grant in 2006.
Madigan's office has notified Obama's presidential campaign of the probe, which was launched this week. But Obama's actions in awarding the money are not a focus of the investigation, Smith said.
Questions about the grant, though, come as spending on local pet projects has become an issue in Obama's campaign against John McCain.
Obama and Kenny Smith announced the "Englewood Botanic Garden Project" at a January 2000 news conference at Englewood High School. Obama was in the midst of a failed bid to oust South Side Democratic Rep. Bobby Rush for a seat in Congress. The garden -- planned near and under L tracks between 59th Place and 62nd Place -- fell outside of Obama's Illinois Senate district but within the congressional district's borders.
Obama vowed to "work tirelessly" to raise $1.1 million to help Smith's organization turn the City of Chicago-owned lot into an oasis of trees and paths. But Obama lost the congressional race, no more money was raised, and today the garden site is a mess of weeds, chunks of concrete and garbage. The only noticeable improvement is a gazebo.
In a previous interview, Smith said the state grant money was legitimately spent, mostly on underground site preparation.
But no one ever took out construction permits required for such work, city records show. And a contractor who Smith said did most of the work told a reporter all he did was cut down trees and grade the site with a Bobcat.
Citing the garden's failure to take root, NeighborSpace -- an umbrella group for dozens of community gardens citywide -- moved Sept. 9 to return the site to the city. Its action followed a July 11 Sun-Times report on the grant.
Obama spokesman Michael Ortiz said Wednesday the senator's staff in Washington will monitor the Madigan probe and an additional review under way by Gov. Blagojevich's administration to make sure "the taxpayer funds allocated for the construction of the garden are recuperated from CBHA if the agencies determine that the funds were not properly spent." Obama's goal is to ensure the site "be used in a way that benefits the community and that any taxpayer dollars allocated are spent wisely," Ortiz said.
The relationship between Smith and Obama dates to at least 1997, when Obama wrote a letter that Smith used to help the housing association win city funding for an affordable-housing development near the garden site. Plans called for more than 50 homes; a dozen ultimately were built.
Smith also has donated $550 to Obama campaign funds.
The Sun-Times learned about Karen Smith's involvement in the project through an Aug. 12 Freedom of Information Act response from a lawyer for Blagojevich¹s Department of Commerce and Economic Opportunity. The department, according to the lawyer, had ³discovered² 52 pages of ³additional documents² ommitted from an initial response in May to a Sun-Times¹ Freedom of Information Act request about the grant.
Neither Smith nor his wife has been accused of any wrongdoing. Smith and his lawyer did not return repeated calls seeking comment.
In an interview in July, Smith said he was never able to raise the money needed for the garden. But the state grant awarded by Obama was spent properly, he said, on the underground work, with most of the work done by a contractor whose name Smith got wrong.
The Sun-Times tracked down the contractor, Rodolfo Marin, in Austin, Texas, where he now lives.
"What I was hired for was: Clean up the area and cut the trees -- that's all," Marin said. He said he rented a Bobcat -- a sort of small bulldozer -- for the project.
And how much did Smith pay him? "If he spent about $3,000 with me, that was too much."
These talks for the $7Billion dollar bail out shoud be televised. It is our money and our elected officials that we pay. There should be transparency during this process. We will only have the media to report the story. And ya know they will all put their little spin on it.
As far as this bail-out...there should NOT be one. It should be a 'no vote' on both sides of the isle.
When the INSANE are running the ASYLUM In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. -- Friedrich Nietzsche
“How fortunate for those in power that people never think.” Adolph Hitler
America's Founders' Financial Advice by Chuck Norris Posted 09/23/2008 ET
America is broke. Wall Street is going out of business. The government is borrowing and bailing like there is no tomorrow. Americans anxiously await the full impact of a second Great Depression. And we all are longing and looking for solutions and saviors.
Who will deliver us from our certain financial despair and ruin? The president? The secretary of the Treasury? The Federal Reserve? Congress? An ad hoc committee of Harvard MBAs? Some of America's best and biggest financial moguls? A new president? Have no fear. Our Founders are here.
It's true that we can't repeat the past eight years of government. But it's even truer that we can't repeat the past 38 years of the government's financial mismanagement, especially when only four of them since 1970 haven't been deficit-building years. What we need is to turn back the financial clock 200 years and return to the fiscal prudence of our Founding Fathers.
With small variances, our Founders agreed on five basic approaches to fiscal management, which I describe in far more detail in the third chapter ("Stop America's nightmare of debt") of my new New York Times best-seller (as of the list of Sept. 2, "Black Belt Patriotism," in which I resolve eight major problems facing America with our Founders' solutions. If we're going to awaken America from its economic slumber, then we must go back to those who discovered and established the American dream. Their financial principles were:
-- Restrict spending within constitutional limits. The 10th Amendment restricts the size of government, and that always should bear out in spending and the federal budget. That means cutting hundreds of billions the Fed shouldn't be spending. That means following congressional protocol. That means understanding that income and export taxes were unconstitutional to our Founders.
-- Don't bail out debt with more debt. George Washington wrote in 1799 to James Welch, "To contract new debts is not the way to pay for old ones." Thomas Jefferson similarly admonished Samuel Kercheval in 1816, "To preserve (the) independence (of the people), we must not let our rulers load us with perpetual debt." (Some are quick to point out that Thomas Jefferson financed the Louisiana Purchase with government loans, but they overlook the fact that Jefferson's administration lowered the federal deficit by nearly one-third during his eight years in office.)
-- Have a pay-as-you-go government. If we don't have the money, we shouldn't spend it. Period. No more debt. No more bailouts. No more spending. As Thomas Jefferson wrote to Fulwar Skipwith in 1787, "The maxim of buying nothing but what we (have) money in our pockets to pay for … (is) a maxim which, of all others, lays the broadest foundation for happiness."
-- Minimize taxes to citizens. Our earliest government's primary tool to raise revenue was from tariffs, not through the countless taxes placed upon citizens today. That is one reason I say to abolish the unconstitutional Internal Revenue Service and implement a "fair tax," which doesn't penalize productivity and will bring American manufacturing back within our borders. As James Madison said in 1783: "Taxes on consumption are always least burdensome because they are least felt and are borne, too, by those who are both willing and able to pay them; that of all taxes on consumption, those on foreign commerce are most compatible with the genius and policy of free states."
-- Get over the greed. We're in this financial mess because of greed. Why is government spending out of control? Greed. Why do we, as individuals and as a nation, keep falling deeper into a pit of debt? Greed. Alexander Hamilton, the first secretary of the Treasury, believed that a government that could use greed to motivate its people would become powerful and wealthy. Unfortunately, we've taken it to the extreme. We've become a nation that confuses our needs and greeds, and we've got to get back to the basics if we're ever to understand and overcome the heart of this financial crisis.
Call me altruistic; say the plan is oversimplified. But even mom always taught me when I was young, "If you get in a pinch, go back to the basics." It works in martial arts. It works in the movies. It works in marriage. It works in financial markets. And it worked for our Founding Fathers.
What we need today are far more men and women in government with our Founders' financial forethought, cautiousness and discipline. But that is not what we have. That is why I've joined the voter revolution across this land to oust political corruption and stalemate. If you're ready to join millions of other Americans in that commitment, then give me three steps: Make a pledge to bring about political change in future elections; recall unconstitutional congressional incumbents; and rise up and elect above-reproach, non-greedy and selfless representatives who aren't afraid to stand up to governmental status quo and corruption, will vote for constitutional restrictions of government, reduce big government (deficits, budgets, spending and taxes), reform the tax code (by providing a "fair tax" or its equivalent) and fight for a constitutional amendment that would mandate a balanced federal budget.
Logged
, "Black Belt Patriotism," in which I resolve eight major problems facing America with our Founders' solutions. If we're going to awaken America from its economic slumber, then we must go back to those who discovered and established the American dream. Their financial principles were:
