U.S. says will give $85 million to help Palestinians

We give $85 million to Palestine, while we have openly supported Israel for how long now? Oh, and our economy is crumbling around us, we have NO money left except the printed-out-of-thin-air variety, yet we have $85 mil to spare for a war in which we are arming both sides?

Wake up America.

http://www.reuters.com/article/worldNews/idUSTRE4BT3VO20081230

Schiff schools CNBC drones yet again

Transition and Hope

By Ron Paul
Texas Straight Talk

As another year draws to a close, there are some important transitions ahead of us. Not just transitions to a new administration, but also economically, politically and culturally.

Many hoped that the changes would signify overwhelming positive steps for our country, and that we would enter a new era, as promised during the campaign. I would like for this to be true, but based on the continuity so far, I would not be surprised to see America stay on the same course of failed monetary and economic policies. The course has been set for several decades, and in reality there is little the new administration could do to fix things without actually making them worse. But I expect them to try. The only real solutions involve allowing the market to liquidate the debt and malinvestment. The political reality is that this is not going to happen.

Through the coming months and years, our nation will find itself at many crossroads, as all manner of socialist, corporatist, protectionist and nationalist initiatives will be thrown at the economy to see if anything will reflate it. Some of these so-called fixes will be enacted amidst much outcry, as with the $700 billion TARP bailout, which the public was right to oppose. About half of that money is gone without a trace, with no accountability, and the economy is no better off for it. Others, such as the proposed new $800 billion plus economic stimulus the new administration is already clamoring for, might have limited public support, as many will find the prospect of receiving a government check a little too tempting to object to. After all, Wall Street got a bailout. What about the little guy? Everything will be attempted by government in the short run to remedy the worsening situation – everything, that is, but freedom. Therefore everything attempted will fail. Unfortunately, government will continue to consolidate and abuse power at an accelerated pace. Government will get bigger, in the short term, and as monetary policy goes from irresponsible to absurd, I have every expectation that we will soon shift from some prices falling to an inflationary nightmare.

But there is hope. As all these attempts fail, more people will demand freedom, and see that it is the only way. Government can only get so big before the country goes broke.

It is regrettable that we keep forgetting what history has shown over and over to be true, because truly, it is a hard and destructive lesson to keep learning. Perhaps it is just something that every generation has to learn for itself. The political and cultural changes that come from these economic transitions will be key to the direction and quality of life for future generations. But I am hopeful because of the strength of the American people and the increased number of voices recognizing that liberty really is the only way to peace and prosperity.

GMAC becomes bank, bailed out with TARP funds

To be PC, the word "bailout" has been replaced by the happier terms "rescue" and "lifeline."

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NEW YORK (CNNMoney.com) -- In yet another move to prop up the crumbling U.S. auto industry, the government announced Monday that it will pump $6 billion into GMAC Financial Services, a financing company critical to the survival of General Motors.

The rescue package has two parts. The Treasury Department is injecting $5 billion directly into GMAC in exchange for preferred equity shares that pay an 8% dividend. GMAC also is issuing warrants to Treasury in the form of preferred stock. If exercised, the warrants will pay a 9% dividend.

Also, the government will lend $1 billion to GM that the automaker will invest in its financing arm. GMAC needs the funding to convert to a bank holding company, a necessary step to receiving the bailout money.

The Federal Reserve said last week that it would approve GMAC's conversion to a bank holding company, subject to certain conditions.

The move deepens the federal government's bailout of the troubled auto industry. Less than two weeks ago, President Bush announced a $17.4 billion rescue package to prevent the collapses of General Motors and Chrysler LLC.

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Europeans see euro trumping dollar

The euro could overtake the dollar in global importance in the next five years, a large majority of continental Europeans believe, according to a poll days before Europe’s monetary union reaches its 10th birthday.

The striking display of faith in the euro, revealed in an FT/Harris poll published on Monday, follows recent rises in the currency’s value that have brought it close to parity with the pound.

On a trade-weighted basis the euro hit a record high this month, raising fears about the impact on struggling exporters, although it has weakened since.

The survey showed that Europeans would welcome a further expansion of the eurozone beyond its 15 members, but highlighted fears among consumers that the euro has fuelled inflation – which they believe the European Central Bank has failed to control effectively.

Since its launch on January 1 1999, the euro has grown steadily in international importance, increasing its share of official foreign reserves and its role in capital markets. The value of euro notes in circulation has also surpassed the value of dollar bills.

According to the FT/Harris poll, some 70 per cent of the Spanish and two-thirds of the French agreed “strongly” or “somewhat” with the statement that the currency could overtake the dollar in global importance by 2014. For Germans and Italians the figures were 58 per cent and 62 per cent respectively. Even some 48 per cent of those polled in the US agreed.

Overall, Europeans were deeply gloomy about the economic outlook, with less than a quarter believing that the recession would last less than a year.

The poll was conducted among 6,165 adults in France, Germany, Italy, the UK and the US between November 26 and December 8.

There's No Pain-Free Cure for Recession

By Peter Schiff
Wall Street Journal

As recession fears cause the nation to embrace greater state control of the economy and unimaginable federal deficits, one searches in vain for debate worthy of the moment. Where there should be an historic clash of ideas, there is only blind resignation and an amorphous queasiness that we are simply sweeping the slouching beast under the rug.

With faith in the free markets now taking a back seat to fear and expediency, nearly the entire political spectrum agrees that the federal government must spend whatever amount is necessary to stabilize the housing market, bail out financial firms, liquefy the credit markets, create jobs and make the recession as shallow and brief as possible. The few who maintain free-market views have been largely marginalized.

Taking the theories of economist John Maynard Keynes as gospel, our most highly respected contemporary economists imagine a complex world in which economics at the personal, corporate and municipal levels are governed by laws far different from those in effect at the national level.

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China has had enough.

Dec. 29 (Bloomberg) -- The global recession is re-exposing fissures in U.S.-China relations that Treasury Secretary Henry Paulson spent more than two years smoothing over.

Heightened tensions between China and the U.S. may worsen a contraction in world trade that already threatens to deepen and prolong the economic downturn. The friction comes as President- elect Barack Obama readies a two-year stimulus package worth as much as $850 billion that will require the U.S. to borrow more than ever from China, the largest buyer of Treasury securities.

“The American economic slump is running into the Chinese economic slump,” says Derek Scissors, a research fellow at the Washington-based Heritage Foundation. “It's creating the conditions for a face-off between Beijing and the U.S. Congress, possibly leading to destabilization of the world's most important bilateral economic relationship.”

Paulson, 62, who visited China 70 times during his career on Wall Street, made improving ties a priority when he arrived at the Treasury in 2006. He advocated diplomacy instead of confrontation, establishing a twice-yearly “strategic economic dialogue” with officials in Beijing, aimed at cooling tensions and deterring Congress from taking up trade sanctions.

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States to start selling infrastructure en-masse to make up budget shortfalls

I'm sure our foreign debtors would be more than willing to accept the title to our infrastructure as settlement for our huge debts. Sure, it will allow states to avoid raising taxes...but instead we'll simply be paying huge tolls and fees to use infrastructure that our tax dollars built...and the proceeds will go to foreign nations. However, we wouldn't expect our feeble politicians to think that deeply, would we?

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By the Associated Press

Minnesota is deep in the hole financially, but the state still owns a premier golf resort, a sprawling amateur sports complex, a big airport, a major zoo and land holdings the size of the Central American country of Belize.

Valuables like these are in for a closer look as 44 states cope with deficits.

Like families pawning the silver to get through a tight spot, states such as Minnesota, New York, Massachusetts and Illinois are thinking of selling or leasing toll roads, parks, lotteries and other assets to raise desperately needed cash.

Minnesota Gov. Tim Pawlenty has hinted that his January budget proposal will include proposals to privatize some of what the state owns or does. The Republican is looking for cash to help close a $5.27 billion deficit without raising taxes.

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Paul: Economic crisis may be a blessing

The following is an exclusive Press TV interview with US congressman Ron Paul, a unique conservative politician who wants an end to US military presence on foreign soil, advocates US withdrawal from the UN, NATO and the North American Free Trade Agreement (NAFTA) and opposes the Internal Revenue Service (IRS).

Ron Paul, House representative of the 14th district of Texas, believes that US foreign policy must be reformed to avoid conflicts around the world.

Press TV: Dr. Paul, thank you for joining us. Let's start with foreign policy. How do you think the new administration will handle the war in Iraq?

Paul: The same way the old administration had. I don't think expect a whole lot of changes although he [US President-elect Barack Obama] had promised to bring the troops home in 16 months, now he isn't out on this because of the so-called agreement.

But I don't think he was ever serious about changing foreign policy. I think foreign policy in this country always stays the same whether the Republicans or Democrats lead it, because when you look at what George Bush ran on in the year 2000, he was strongly critical of Clinton's foreign policy of too much nation building and too much policing of the world, because the American people liked to hear that. But once they get in they do same thing.

So, I don't expect much change in Iraq. At the same time, he doesn't even pretend to have a difference of opinion on Afghanistan. So it isn't so much the individual countries, what he's going to do, as much as he overall endorses foreign interventionism.

And it is just of a matter of how fast you move and which leaders you have but essentially he picked all the leaders John McCain loves. The neocons love the foreign policy group that he has put together. So it is just a matter of time before the Democrat base that did not want him to continue the Bush-McCain policies... they are going to get pretty upset I think pretty soon.

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The third-worlding of Detroit

The Great Depression has reached Detroit. The average price of a home is now $18,513 and unemployment has reached 21%, and it’s expected to get worse. Detroit is facing a crisis of epic proportions that officially puts Detroit statistically (and real term) on par with the great depression. Many readers of Tribble Ad Agency are advertising centric.. and due to the rash of layoffs within all Detroit Advertising firms has put the city on the map for the wrong reasons.

It has become the center of all that is wrong with America… and nothing of what is right.

For example, the crime rate has fallen…. because of lack of targets within the city. Meaning there is nothing left to steal. In fact, even the criminals don’t want to leave jail.

Heard confirmed that some offenders, notably those without homes of their own, were now expressing reluctance to leave jail when their sentences were done.

Home values have plummeted to levels not seen in 1/2 a century… and the 21% unemployment has in some cases been projected to double within 12 months if the auto industry totally collapses.

To make matters even worse, Detroit has superseded New Orleans as the “worst city” in America…. but New Orleans had a Hurricane they could assign blame to… Detroit has no such natural disaster crutch.

“It’s a depression — not a recession,” McDuell said, with the authority of someone who has lived through both. “It will get worse before it gets better.”

It’s a man-made disaster.

Regarding a local food bank in Detroit that has seen record numbers of individuals entering the system:

“Many people are first-timers — they have no idea how to navigate the system, how to qualify for food stamps,” Wells said. “Last year, some were donors — now they’re clients.”

In short, last year they donated money into the system… now they are feeding from it because they themselves are in hard financial times.

Detroit needs a miracle, the chances of it showing a resurgence is slim to none in the current economic outlook.

More "change" you can believe in

Defense Secretary Robert M. Gates is asking many of the Bush administration's 250 Pentagon political appointees to remain on the job until the incoming Obama administration finds replacements -- a move designed to prevent a leadership vacuum with U.S. troops engaged in wars in Iraq and Afghanistan.

The unusual request by Mr. Gates, whom President-elect Barack Obama has asked to continue in his Cabinet post, ensures that key policy positions will not be left to "acting" subordinates as typically occurs when political appointees are directed to resign during a presidential transition.

"I have received authorization from the president-elect's transition team to extend a number of Department of Defense political appointees an invitation to voluntarily remain in their current positions until replaced," Mr. Gates said in a Friday e-mail.

The chance to stay is "available to all willing political appointees with the exception of those who are contacted individually and told otherwise," he said.

Geoff Morrell, Pentagon press secretary, confirmed that Mr. Gates wants to retain temporarily most political appointees, saying nearly all of the service secretaries and undersecretaries will remain until Senate confirmation of their successors, which can take months. He declined to identify who will be asked to leave.

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Is the Medicine Worse Than the Illness?

By James Grant

Wall Street Journal

Elihu Root, Republican senator from New York, thought he smelled a rat. Anticipating the credit inflations of the future and recalling the disturbances of the past, Mr. Root attacked the bill in this fashion: "Little by little, business is enlarged with easy money. With the exhaustless reservoir of the Government of the United States furnishing easy money, the sales increase, the businesses enlarge, more new enterprises are started, the spirit of optimism pervades the community.

"Bankers are not free from it," Mr. Root went on. "They are human. The members of the Federal Reserve board will not be free of it. They are human....Everyone is making money. Everyone is growing rich. It goes up and up, the margin between costs and sales continually growing smaller as a result of the operation of inevitable laws, until finally someone whose judgment was bad, someone whose capacity for business was small, breaks; and as he falls he hits the next brick in the row, and then another, and then another, and down comes the whole structure.

"That, sir," Mr. Root concluded, "is no dream. That is the history of every movement of inflation since the world's business began, and it is the history of many a period in our own country. That is what happened to greater or less degree before the panic of 1837, of 1857, of 1873, of 1893 and of 1907. The precise formula which the students of economic movements have evolved to describe the reason for the crash following the universal process is that when credit exceeds the legitimate demands of the country the currency becomes suspected and gold leaves the country."

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Madoff would be a perfect candidate to run Social Security

Madoff ponzi scheme = pay returns to past investors with current investors' money

Social Security ponzi scheme = pay returns to past contributors with current contributors' money


If we're real lucky, we'll call the position "Social Security Czar" in accordance with our government's continuing obsession with Soviet Russia.

2009

My thoughts on 2009 are not positive. My thoughts on the future of this country are not positive. For that, I am labeled a pessimist, but so be it. I refuse to accept concepts that are doomed to failure from the start, and have been proven as ineffective in the past. Sooner or later, people will dig their heads out of the sand and realize what is really going on, but I fear that by the time that happens, it will be too late.

All this talk about a "market bottom" and predictions on when the housing market will recover. First thing, the market means nothing. Anyone who has even the most elementary understanding of the stock market will tell you that the market is being manipulated by both our government and corporate elites. The government has agencies such as the Commodity Futures Trading Commission and the President's Working Group on Financial Markets (aka Plunge Protection Team) are basically given free reign to interfere with markets. Why else would these Federal agencies exist? Are they working in "good faith?" If you trust any government agency at this point, you are the definition of naive.

The corporate elite have been allowed to use short-selling tactics to swing the market up and down wildly day-to-day, while mark-to-market accounting tactics have allowed the largest banks in the country to hide liabilities from their balance sheets. The government has allowed ridiculous financial instruments such as credit default swaps, which are nothing more than insurance on investments that have no real capital behind them. They simply had to change the wording to "swap" instead of "insurance", and apparently that was enough for the SEC to turn a blind eye. Once the investments insured by these CDS's started defaulting, the issuers of the CDS's had no means of making the insurer whole, because there was nothing backing the CDS in the first place!

The housing market still has a long way to go before it can recover. Alt-A and option ARM mortgages will be resetting at the beginning of the year, ushering in a tidal wave of new foreclosures probably mid-2009 and beyond. Take a look at the chart below to see what's headed our way.

This will ultimately lead to more government intervention, sold to the public as a way to "stem the losses" within the market. In reality, it will only prolong the problem, as you can use taxpayer dollars to prop up phony housing prices all you want, but it will only create another bubble that will burst down the line. The market needs to adjust, bring prices down to where they should have been in the first place, and only then will the market be allowed to recover. This will not be an easy process; it will involve many foreclosures, leaving folks out on the street. However, it needs to happen, so we might as well take our medicine and get it over with now.

You can thank your government for creating the housing bubble. In the 90s, president Clinton accelerated the Community Reinvestment Act, which was originally put in place by the Carter administration. This Act, in effect, forced lenders to lend to minorities and other groups of people who should not have qualified for a mortgage and has no means in which to pay it. Some of these mortgages involved no money down and no employment in some cases. The mortgages were backed by the government, however, so these lenders had a huge incentive to take on excess risk associated with these mortgages, considering they were backed by the "full faith and credit" of the United States.

Why would lenders take on these risky mortgages, even if they were backed by the government, if the borrowers would default anyway? Compensation is tied to mortgages given out, and in some cases the lenders were penalized if they didn't lend to protected groups.

Financial Health of the United States

We have already witnessed the Federal government pump trillions of dollars, dollars essentially printed out of thin air by way of the Federal Reserve, into our economy. It is sold to the public as a way to "stop the bleeding." Somebody please inform Washington that the patient is dead. The taxpayer of the United States is tapped out...there is no more money to go around. The hasty approval of the 700 billion dollar bailout has opened Pandora's Box, something that was warned about all along but largely ignored by Congress. One only needs to look at who is financing their campaigns to see why:

Now we see the automakers being bailout out. Several states are on the brink of bankruptcy and are asking for a bailout. In my home state, representatives are asking for a bailout for the RV industry, of all things, citing that it is critical to Indiana's economy. Where does it end?

The answer is, it doesn't end. Once the government spigot is turned on, it will take a wrench of epic proportions to turn it off. You may have heard of the phrase "there's nothing more permanent than a temporary government program." There has never been a situation where that phrase fits more perfectly.

Most Americans are against any type of bailout, yet Congress does it anyway. Are people outraged? Not really. The ones who are really upset may go as far as to write an op-ed in their local newspaper. That's about the extent of the resistance. Where is the passion? Where are the riots? They don't exist, because as long as American Idol is on every Thursday and 9 p.m., people are happy.

Most Americans don't realize that every Fed interest rate cut, every TARP program, every bailout, every decision that Dictator Henry Paulson makes effects EVERY SINGLE ONE OF US in a huge way, and it goes beyond simply squandering of our tax dollars. It is about debasing and destroying our currency. Our dollar is as good as dead.

The Mona Lisa is valuable because there is only one in the entire world. Art collectors would be willing to pay unlimited amounts of money for that painting. So what would happen if, somehow, anyone could go down to Wal-Mart and buy an authentic Mona Lisa painting?

The answer is obvious, it would be worth next to nothing. The same can be said about our dollar. When you pump trillions of excess dollars, dollars created out of thin air, into our economy, each dollar will become worth less and less as that money creeps its way through our economy. That means rapid inflation, or worse, hyperinflation. If you want to see what kind of devastating effects inflation has on people, one needs to look no further than Zimbabwe, a country that has seen a 231,000,000% increase in inflation, and has bank notes denominated in the billions.

Of course, the bailout of the banking industry has created an interesting problem for Congress. The Federal Reserve won't tell who the recipients of the money were, and the banks won't tell what they spent the money on, and Congress is essentially powerless to do anything about it. Who gave the Federal Reserve and the Treasury so much power? Congress did, with the passing of the 700 billion dollar bailout. Not only that, but they essentially granted Henry Paulson with more power than the President. He is an appointed figure and answers to no one, except for the President himself.

Freedom

We will see taxes increase. There is no way around it. The Governor of New York recently annouced a whole slew of egregious taxes, including an "iPod tax" and a "obesity tax", which taxes sugary sodas. The Federal government will now regulate what you eat.

Ridiculous taxes will crop up all over the country as states and local governments struggle to balance budgets and make up huge shortfalls. Depending on how bad it gets, it could very well lead to tax revolts. The taxpayer is tapped out; his savings is gone, his credit cards are maxed, his house is in foreclosure, and he very well might be out of work. What open credit lines he possesses will be cut, and the interest rates will be doubled. People will go to new extremes when they are pushed to the limit.

Since 9/11, the Federal government has gone to soaring heights in order to keep us "safe" from terrorists. Actually, all they did was use the event to take away more of our freedoms. The Federal government now as the power to listen in on your phone conversations and search your home without a warrant, thanks to the PATRIOT Act. If somebody gets in their way, they will simply dig some dirt on you, label you an enemy combatant, and do it anyway. The PATRIOT Act was written before 9/11, but that tragic event allowed a rather convenient way for the Bush administration to push the bill through Congress with relatively no resistence.

If we encounter another attack, I fear what freedoms and liberties they will take next. Troops are being mobilzed all across the country, doing crowd control exercises in the event of civil unrest, as well as homeland security prevention tactics. The Marines are doing DUI checkpoints in California. There are several witnesses in Arizona that the military is becoming increasingly involved in police tactics. Why are they doing this? You tell me.

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I'd really like to believe that when the clock strikes midnight and 2009 is officially here that everything will be rosey again and we can all go out and buy flat screen TVs with someone else's money, but that's just not the reality. Barack Obama is not our savior. He can run the budget deficit as high as he wants, he can pave over every road 7 times and rebuild every bridge in the country, but that will not be our saving grace. Big government is not, and will never be the answer. Central planning does not work, it's been proven time and time again. Keynsian economics is not sustainable. Until we figure that out, the outlook will continue to be bleek.

$1.6B Went to Bailed-Out Bank Execs

Banks that are getting taxpayer bailouts awarded their top executives nearly $1.6 billion in salaries, bonuses, and other benefits in the calendar year 2007, an Associated Press analysis reveals.

The rewards came even at banks where poor results last year foretold the economic crisis that sent them to Washington for a government rescue. Some trimmed their executive compensation due to lagging bank performance, but still forked over multimillion-dollar executive pay packages.

Benefits included cash bonuses, stock options, personal use of company jets and chauffeurs, home security, country club memberships and professional money management, the AP review of federal securities documents found.

The total amount given to nearly 600 executives would cover bailout costs for 53 of the 116 banks that have so far accepted tax dollars to boost their bottom lines.

Rep. Barney Frank, chairman of the House Financial Services committee and a long-standing critic of executive largesse, said the bonuses tallied by the AP review amount to a bribe ''to get them to do the jobs for which they are well paid in the first place.

''Most of us sign on to do jobs and we do them best we can,'' said Frank, a Massachusetts Democrat. ''We're told that some of the most highly paid people in executive positions are different. They need extra money to be motivated!''

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CNBC to consumers: spend or ruin the economy

This is just disgusting.

In a recent study released by the Pew Research Center, it was reported that 73% of Americans say they plan to cut back on their holiday shopping this year. Nearly six-in-10 of those who said they're cutting back report they're doing so because they worry things might get worse; only 28% said they are cutting back because their financial situation has deteriorated.

Sure, we all need to save more and spend less, but extreme tightening might be the worst thing that consumers can do in tough times, as stopping normal spending will only put more pressure on the weak economy.

Just when you thought you've read it all.

With economy in shambles, Congress gets a raise

A crumbling economy, more than 2 million constituents who have lost their jobs this year, and congressional demands of CEOs to work for free did not convince lawmakers to freeze their own pay.

Instead, they will get a $4,700 pay increase, amounting to an additional $2.5 million that taxpayers will spend on congressional salaries, and watchdog groups are not happy about it.

“As lawmakers make a big show of forcing auto executives to accept just $1 a year in salary, they are quietly raiding the vault for their own personal gain,” said Daniel O’Connell, chairman of The Senior Citizens League (TSCL), a non-partisan group. “This money would be much better spent helping the millions of seniors who are living below the poverty line and struggling to keep their heat on this winter.”

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Another Paulson headfake

Just a few short days ago, Paulson said he had "no plans" to seek the additional 350 billion from the TARP fund before leaving office. It should come as no surprise that he juked the country again, running to Congress with his tried-and-true fear mongering. Paulson says he now needs the additional 350 billion to pay for the auto bailout and to "to support financial market stability."

Congress has vowed to debate the issue heavily, with many key democrats extremely upset with Paulson because of his complete and utter disregard for transparency (or any other due process of law). The funds will be distributed automatically unless the houses of Congress vote it down.

Just a friendly reminder that Hank Paulson is not an elected official, he is appointed by the President, and is in complete control of trillions of taxpayer dollars and answers to no one. Congress is powerless to reign him in as a result of language in the TARP bill. All Congress can do is shout at him and Neel Kaskari in episodes of political theater.

While we're at it, let's remind everyone that the Federal Reserve is a private bank with no Federal budget, yet holds the public taxpayer purse. They control the economy by issuing our currency and adjusting interest rates. Essentially, they play god with our economy and we are the pawns.

Had enough America?

Illuminating the Illuminati: Charles Schumer and Barney Frank Are Owned By The Big Banks

By Cody Willard

Fox Business Network

Here’s a winning formula for our society, wouldn’t you agree? Let’s entrust our politicians to regulate an industry, then have the heads of that industry become the bureaucrats who are entrusted to carry out those regulations, and when things go wrong from all that cronyism, let’s have give tons of welfare money to the giant corporations in that industry which can then use that money to donate to their politicians who can then win votes to continue to regulate that now insolvent industry.

The executives and managers at Citigroup (C), Goldman Sachs (GS), Bank of America (BAC), Morgan Stanley (MS) and the rest of the big Wall Street corporations – including Chuck Prince and Hank Paulson – lied to all of us for years about the value of their assets. A lot of those guys who used to run the banks are now charged with regulating and/or doling out trillions of dollars in welfare to their former partners. Yeah, these bankers sucked trillions of dollars in “earnings” built upon those lies out of the economy and instead of saving those trillions for a rainy day when their lies stopped working, they paid themselves and a few of their closest friends most of that money in bonuses and salaries.

And who was “regulating” all of this gamesmanship? Your socialist Republican/Democrats, of course. Including Barney Frank and Chuck Schumer.

These are the same guys that you think are going to fix the mess they and their cronies have created. Why do I call Frank and Schumer and the banking industry a bunch of cronies?

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Automakers get their money, Stalin rejoices

The amount: 13.4 billion, with the opportunity for an additional 4 billion in February.

The reasoning: "To avoid a disorderly bankruptcy." "To avoid further economic collapse." "Insert random fear mongering tactic here."

The conditions: Must prove to be financially viable by March or the loans are called back to the Treasury. Must cut executive compensation. Absolutely nothing so far about any Union compromises.

The stakes: More wasted taxpayer dollars via an unconstitutional doling out of money.

The dictators: George Bush, with Hank Paulson now assuming the role of car czar. He'll use his expertise in auto manufacturing to tell them how to build better cars.

The victims: The Constitution. The Senate and the legislative branch (completely sidestepped). The American people (being continuously looted and lied to).

The winners: The global elite. The Union cartels and their respective mob bosses.

Another sad day for America. I want my Republic back.

Chrysler closes plants for a month; White House scrambles

Chrysler has announced that it will shut down all plants for at least a month, with the last shift ending tomorrow. This comes off the heels of a failed bailout legislation, that was defeated handily by the Senate due to failure of the UAW to budge on a labor compromise. It also follows GM, who announced it will idle over 20 plants in a cost cutting measure.

As a result, the White House has accelerated plans to "rescue" the automakers, hoping to get something done before Christmas. It is expected that the White House will attach certain conditions on any potential bailout, with a pre-packaged bankruptcy reportedly on the table, but it is unclear what exactly the White House will demand from the automakers in exchange for taxpayer Federal Reserve notes. The figure of 14 billion, the original amount debated in Congress, is likely to balloon to somewhere in the neighborhood of 40 billion, a number that is most certainly dreamed up out of thin air.

It's likely that Dictator Hank Paulson will now assume the role of the ridiculous "car czar", since the White House is choosing to sidestep Congress in another unconstitutional stunt to please the elite big wigs in Detroit. However, it will be interesting to see how a potential bailout is funded. Only 15 billion remains in the TARP fund, enough for the original bailout plans, but any additional funds will require Congressional release of the remaining 350 billion, something that Paulson says he will not persue before leaving office.

Clearly, however, Congress has become increasingly irrelevant as the tyrannical White House does whatever it wants, regardless of the opinion of Congress and the people of this country. Any act of Congress is simply a formality and a grand showing of political theater at this point.

Lawsuits, the Cadaver & Gold

An historically unprecedented mess has been created by compromised central bankers and inept economic advisors, whose interference has irreversibly altered and damaged the world financial system, urgently pushed after the removed anchor of money to gold. Analysis features Gold, Crude Oil, USDollar, Treasury bonds, and inter-market dynamics with the US Economy and US Federal Reserve monetary policy.

The principal missing piece in the grand American mosaic of banking destruction, corrupt collusion, fraudulent bonds, Wall Street control, suppressed regulators, compromised ratings agencies is JUSTICE and REMEDY. Foreign entities are aghast as the lack of prosecution, remedy, and removal from positions of power, as policy continues to be set by the participants responsible for the structural failure and prevalent fraud. Their actions are reaching climax levels. The climax of the Wall Street strangehold is the confiscation of the TARP funds to date. However, whatever has not been nationalized is subject to lawsuits during disconnection. The pattern of human behavior indicates that lawsuits can spawn additional lawsuits, and quickly control is lost. Two major lawsuits have the potential to change the landscape. Curiously, neither receives much publicity. Then again, the press seems somewhere between subservient and compromised anyway. They have failed to shine many lights on much of any developments until after the damage is done, sometimes resembling video tabloids.

The USFed might be vulnerable. Could it be that the US Federal Reserve will face a growing expanding escalating lawsuit that finally is heard before the US Supreme Court? Give it a 50-50 chance, but this really needs a Vegas line. They are behaving and reacting much like a syndicate. One well connected contact claims their days are numbered. Stonewall tactics by the USFed on disclosed disbursement of TARP funds continues, despite court challenges. The USFed has begun to take on some curious similarities to a shady syndicate central clearinghouse. It refuses to disclose which banks received bond swaps, and refuses to reveal what assets it accepted as collateral. One can only suspect gross impropriety. Before long, RICO Laws against racketeering might be invoked. The word has been mentioned in the press by one particular Congressman. Recall. The Racketeer Influenced & Corrupt Organizations Act of 1970 has been a powerful legal weapon to prosecute crime syndicates and to confiscate their ill-gotten assets.

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Pessimistic = Realistic

This excellent commentary explains the real truth, and the real consequences, behind yesterday's rate cut. Every single person in this country needs to be aware of this situation.

Yesterday we closed at a historic low, and early indications today are even worse, at 21.20 The IRX, or yield on the 13 week T-Bill, is essentially zero.

One cannot argue one simple fact - Bernanke hasn't yet started buying the long end of the curve to any material degree. But he's been threatening, and today the FOMC statement made explicit what had been whispered before.

The mouth-breathers were all over CNBC and elsewhere yesterday and today claiming that this would "stabilize" the credit markets and make credit (and the economy) better, with the most outrageous displays of stupidity being put forth by Cramer and McCulley of PIM(p)CO.

Yeah, right.

Now let's take a more cynical, but realistic, view.

Remember last year. Oil went from $60 to $150 in the space of a few months. Why? Because it was no longer profitable to buy CDOs and RMBS, as they were imploding. The money has to go somewhere, and so traders bet in front of what they believed Bernanke would do - crank down interest rates at an insanely-accelerated rate, which would spike prices in commodities, as the economic slowdown had not yet occurred - and wouldn't for several months.

They were right. Bernanke did it, oil shot the moon and Goldman (and a few others) made a whole bunch of money.

Who paid?

You did, by paying $4/gallon for gasoline.

Now let's back up a bit. 2003, to be exact. What happened? Greenspan (and Bernanke) played the same sort of game and house prices went ballistic. A handful of people made fortunes securitizing various mortgage and other "assets" into complex (and opaque!) securities, foisting them off on the world.

Who paid?

You did, by overpaying by 20%, 50%, 100% or more for a house.

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iPod tax...salvation from a financial meltdown

Gov. Paterson of the great state of New York is getting creative in his attempt to close the budget deficit in the state. Just take a look at some of the tax proposals:

• An "iPod tax" that charges state and local sales tax for "digitally delivered entertainment services" - in other words, that new Beyonce song you download.
• State sales tax at movie theaters, sporting events, taxis, buses, limousines and cable and satellite TV and radio.
• Costlier driving with the repeal of the 8-cents-per-gallon sales tax cap on motor and diesel motor fuel, plus and increase in the auto rental tax.
• Tuition increases at SUNY and CUNY, $620 and $600 a year respectively.
• A 50 cent tax on cigars. The current tax is equal to 37% of the wholesale price, or 34 cents a cigar.
• No more sales tax break on clothes and shoes worth $110 or less, except during two weeks a year.
• Higher taxes on wine, beer and flavored malt beverages. He would also impose an 18% tax on non-nutritional drinks like soda.
• The rich would pay more for luxury items through an additional 5% tax imposed on cars costing more than $60,000, aircraft costing more than $500,000, yachts costing at least $200,000 and jewelry and furs costing in excess of $20,000.
• In addition, a host of a fees, including those related to motor vehicle licensing and registration, parks and auto insurance, would go up, as would various state-imposed fines.

These "unconventional measures", a term the Fed has coined, isn't likely to go over well with New Yorkers. Unfortunately, this type of tax plan is likely to become widespread across the country as state and local governments struggle to stay above water.

However, there will come a time where the people say "enough is enough."

SEC's Chris Cox to those who lost billions due to ponzi scheme: My bad.

"I am gravely concerned by the apparent multiple failures over at least a decade to thoroughly investigate these allegations or at any point to seek formal authority to pursue them," said commission Chairman Christopher Cox in a written statement.

That's all you'll get from Chris Cox and the SEC, who turned a blind eye time and time again when warned about Bernard Madoff, who allegedly ran a ponzi scheme that swindled billions from institutions all over the world.

It seems that a pattern is forming in regards to Mr. Cox and the SEC, who also chose to ignore many red flags signaling the current financial crisis. The fact that Mr. Cox is owning up to any failure at all by the SEC is a huge victory. The default "pass the buck" response would have been more than appropriate here.

Not surprisingly, those duped by Madoff are looking for restitution, and it isn't hard to guess where they are expecting the money to come from; the world's insurance provider: the Federal government. Yet again, the taxpayer will ultimately bear the burden of Madoff's corruption.

Chris Cox has been criticized heavily over "mark to market" accounting procedures that have allowed investment firms and brokers to hide billions of liabilities off their balances sheets, thus leaving investors completely in the dark about the real value of the firms. He has also been criticized over short selling deregulation that, in effect, allows large firms to swing the entire stock market up or down several hundred points in a given day.

My question is this: how does this guy still have a job?

Fed cuts interest rates to zero

In a shocking turn of events (sarcasm), the Fed has slashed interest rates "from zero to 0.25%" aka 0%.

As a result, gold and silver are up and the dollar is down. I fear the dollar has begun it's never ending death spiral.

Solving the problem of too much cheap money with....FREE money; sounds like a great solution to me.

Obama Says Fed Is "Running Out of Ammunition"

He says tools are still available, but it's critical for other branches of government to "step up." He says an economic recovery plan is still "absolutely critical."

Obama said his economic team is meeting today, working on what he calls a "bold agenda."

This scares the hell out of me.

Economic Freedom or Socialist Intervention?

By Ron Paul
Texas Straight Talk

The freedom to fail is an essential part of freedom. Government- provided financial security necessitates relinquishing the very essence of freedom. Last week, the big 3 American automakers came back to Capitol Hill with their hands out to the government. Congress spent this past week debating how much money to give them and what strings should be attached. Though the bailout plan for the auto industry has suffered what I would call a temporary setback in the Senate, other avenues for public funding are being explored through the Federal Reserve and the Treasury Department. I am afraid the American auto industry will soon learn that having billions rain down from Washington will not be the blessing one might expect.

The government, after it subsidizes an industry, tends to become a very demanding benefactor. Politicians may not have any real idea about how to build a car, run a bank, educate a child, heal the sick or build a road, but they are quite adept at using carrots and sticks to manipulate and threaten those who do. Most of the federal control over education, roads, healthcare, and now banking and soon auto manufacturing, is done through money, mandates and conditions. The bailout proposal we were considering would force automobile manufacturers to submit their business plans for the approval of a new federal "car czar." This bureaucrat would have the authority to approve the automakers’ restructuring plan, monitor implementation of the plan, and even stop certain transactions he determines are inconsistent with the companies’ long-term viability.

One could argue that if billions of taxpayer dollars are going to flow into a failing industry, then representatives of those taxpayers have "bought" a say in how that industry is run – which is precisely why bailouts are such a bad idea for both the industry and the taxpayers. The federal government has neither the competence nor the Constitutional authority to tell private companies, such as automakers, how to run their businesses. I would have thought that failed experiments with central planning and government control of business that caused so much harm in the last century would have taught my colleagues the folly of making businesses obey politicians and bureaucrats instead of heeding the wishes of consumers, employees, and stockholders. But the auto industry is in danger of learning for themselves one of the oldest lessons in politics: he who pays the fiddler calls the tune.

It is not the job of government to sustain business. The government should get out of the way, and instead examine excessive regulations, tax policy and red tape that have been hostile to manufacturing in this country. We should get back on a sustainable economic course in this country, or we are doomed to collapse, as the Soviets did, under the crushing burden of big government and a strangled economy that can no longer pay for it.

Follow the money trail

Why was the bank bailout bill defeated the first time, yet passed feverishly the second time when the vast majority of Americans were vehemently against it?

Did our Congress do what's best for America? Sadly, no. Video below explains it all.

Most Americans Don’t Understand Basic Economics

New survey shows the majority of consumers can’t correctly answer questions about borrowing, interest rates and even basic math.

The Center for Economic and Entrepreneurial Literacy (CEEL) recently released a new survey underscoring the need for increased education on personal finance and economic issues. The national survey shows an overwhelming number of Americans are unable to answer some of the most basic questions about borrowing, interest rates, terminology and even basic math. More troubling is that many Americans admit to making poor decisions with their own personal finances.

Startling highlights from the survey include:

• 54 percent of respondents could not identify what a subprime mortgage was.
• 56 percent of respondents could not identify FICO score as the most important factor in getting a loan.
• 65 percent of respondents could not identify what would remain if you subtracted 25 percent from 8. One in three respondents could not identify what 1 percent of 50,000 was.
• 75 percent did not know that when in need of short-term emergency cash, bouncing a check costs more than wire transfers, credit card advances and short-term payday loans.
• Half of respondents have overdrafted their checking account at one time, while a third of respondents have paid a bill late in the past year.
• 35 percent of respondents admitted to not having a family or personal budget that would allow them to conceivably eliminate their credit card debt by the end of 2009.

Innovation at the Federal Reserve

Looks like the Fed is about to get a little more creative with it's "toolkit" (i.e. basket of unconstitutional, phony solutions to our financial problems) . That doesn't come at a shock, considering interest rates are near zero, so there's no more room for "quantitative easing" in that regard. Or, as Keynesian propaganda outlet CNBC likes to call it, "further unconventional steps." Might as well call a spade a spade, it's a shot in the dark, with our currency and our economy on the line.

What will the Federal Reserve cook up next in their ongoing social experiment with our tax dollars? Stay tuned folks, it's likely to be entertaining...and ineffective.

Rod Blagojevich: What's the real story?

The Rod Blagojevich scandal has turned into quite the media circus. It has all the makings of a great smear story: a disgraced governor, rampant corruption, ties to the President-elect, uncertain involvement by the President's cabinet, and the list goes on. However, there is something fishy here and I doubt it will be discussed by the media.

On December 8th, Rod Blagojevich visited the workers of Republic Windows & Doors, who were protesting against their employer and Bank of America for withholding compensation and abrupt termination. Blagojevich's show of support came as a bit of a surprise, but then he did something that no one saw coming; he came out publically against Bank of America and ordered the state to sever all business and transactions with the bank. This had the potential to cost Bank of America billions of dollars.

The very next day, Federal investigators called a news conference to announce, among other things, that Blagojevich was involved in trying to sell President-elect Obama's vacant Senate seat, as well as other corruption charges. It is worth noting that the news conference was very hostile and aggressive, noting that the charges would make "Lincoln turn over in his grave."

One thing I have learned about the media: if you take the story at face value, chances are you aren't getting the truth. You must put the evidence together in your own mind in order to determine the validity of a story. In this case, two things come to mind. First: the fact that Federal investigators have been tracking Blagojevich for nearly four years, using wire tapping tactics. Blagojevich had full knowledge that he was being monitored. Second is the fact that investigators chose to charge Blagojevich the very next day after coming out against Bank of America.

What am I suggesting here? I'm suggesting that it is a little strange that Blagojevich was blown up the very day after speaking out against Bank of America, who stood to lose billions if Blagojevich executed his plan. I am also very skeptical of President-elect Obama's mythical response to the scandal, and the assumed involvement by Rahm Emanuel in the replacement of the Senate seat. There is most certainly more to the story than what we are being told.

Am I suggesting that Blagojevich is not corrput? Absolutely not, I wouldn't be surprised if many of the corruption charges against him are completely true. However, I would argue that many of the tactics used by Governor Blagojevich are used on a routine basis by many politicians. Whether it gets out in the media is a matter of A) did the politician get caught or B) did the politician go against the establisment.

Blagojevich went against the grain and is paying the price.

CBS: Barney Frank is the smartest guy in Congress

Read story here

Really CBS? Smartest guy in Congress?

This is the same guy who:

• Stated boldly that Fannie and Freddie were in perfectly good health and there was nothing to worry about.
• Was involved in a prostitution ring scandal.
  
• Authored the TARP bailout, basically giving Henry Paulson free reign, limitless power and unlimited taxpayer dollars. Not to mention it was loaded with pork. How'd that turn out Mr. Frank?
• Authored the auto bailout, which added even more governmental control and added another layer of government bureaucracy ("car czar").
• Refuses to admit any wrongdoing in this economic meltdown, choosing rather to pass the buck like every other politician.

I understand that CBS is a liberal media outlet, but this is laughable. Even the most liberal of individuals would agree that Frank has made a joke out of Congress.

Besides that, the words "smart" and "Congress" need to be used very carefully.

President Bush...Human or Ninja?

Say what you want about President Bush, but he's got some cat-like reflexes! I must say, I'm very impressed.

On a serious note, the shoe-thrower was a well established reporter, not some crazy extremist. This incident speaks volumes about the level of angst against the United States, even by well-to-do Iraqi's.

Ron Paul on the auto bailout

A Nightmare Before Christmas

By Peter Schiff
Euro Pacific Capital

Like many pragmatic economists I have always warned that rapid expansions of government debt would result in inflation and higher interest rates. The explanation was always simple: rising supply of government debt inflates the money supply and weakens the government’s ability to service its debt through legitimate means.

But In recent months, government has flooded the market with hundreds of new Treasury obligations and telegraphed its intention to increase the deluge even more. In response, both bond prices and the dollar have risen. This benign reaction has led many to the happy conclusion that the doom and gloomers are wrong and that bailouts and economic “stimuli” can be financed with deficit spending without any adverse consequences on interest rates or consumer prices. Recent action in the foreign exchange markets suggests these hopes will prove illusory. The renewed strength in gold, together with the long over do rupture of the correlation between the movements of foreign currencies and U.S. equities, is further evidence that recent market dynamics are changing.

When the financial crisis of 2008 kicked into high gear in September, the U.S. dollar began to rally furiously. While America’s economic ship was sinking from stem to stern, its currency was becoming the must have asset for public and private investors around the world. The dollar benefitted from the positive flows that result from massive global deleveraging. Treasuries got an added boost from a reflexive flight to “safety.” As a result, politicians were able to fill out their Christmas wish lists with complete confidence that Santa would deliver. However, as these dollar-positive forces appear to be giving way, the Grinch is about make an unwanted appearance.

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Fed refuses to reveal recipients of taxpayer funds

Dec. 12 (Bloomberg) -- The Federal Reserve refused a request by Bloomberg News to disclose the recipients of more than $2 trillion of emergency loans from U.S. taxpayers and the assets the central bank is accepting as collateral.

Bloomberg filed suit Nov. 7 under the U.S. Freedom of Information Act requesting details about the terms of 11 Fed lending programs, most created during the deepest financial crisis since the Great Depression.

The Fed responded Dec. 8, saying it’s allowed to withhold internal memos as well as information about trade secrets and commercial information. The institution confirmed that a records search found 231 pages of documents pertaining to some of the requests.

“If they told us what they held, we would know the potential losses that the government may take and that’s what they don’t want us to know,” said Carlos Mendez, a senior managing director at New York-based ICP Capital LLC, which oversees $22 billion in assets.

The Fed stepped into a rescue role that was the original purpose of the Treasury’s $700 billion Troubled Asset Relief Program. The central bank loans don’t have the oversight safeguards that Congress imposed upon the TARP.

Total Fed lending exceeded $2 trillion for the first time Nov. 6. It rose by 138 percent, or $1.23 trillion, in the 12 weeks since Sept. 14, when central bank governors relaxed collateral standards to accept securities that weren’t rated AAA.

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GOP Senator Warns of 'Riots' if Automakers Are Bailed Out

By Jeff Poor

Business & Media Institute

Time and again we’ve heard about the lost jobs and economic impact of failing to bail out the beleaguered American auto manufacturers. But little mention has been made of the consequences of going through with the bailout, and how such an action would be viewed by other Americans.

In an interview following a Dec. 10 press conference where he and four other senators aired their opposition to the proposed bailout deal struck by congressional leaders and the White House (and approved by the U.S. House of Representatives 237-170 that evening), Sen. Jim DeMint, R-S.C., warned that the perception that some industries are being bailed out and some aren’t could lead to violence.

“We’re going to have riots. There are already people rioting because they’re losing their jobs when everybody else is being bailed out. The fairness of it becomes more and more evident as we go along. The auto companies may be hurting,” he said, but “there are very few companies that aren’t hurting and they’re going to hurt. We don’t have enough money to bail everyone out.”

DeMint blamed the unions for pushing this issue as far as it has gotten. The senator said the notion that reorganization under bankruptcy would not work was generated by the unions for fear of losing their power.

“The primary driver behind this is the unions, because bankruptcy allows the auto companies to basically restructure all their contracts in a way that a bankruptcy judge says will make them sustainable,” DeMint said. “And if they do that, then essentially the unions lose all their leverage. It’s the unions that have brought them to the brink. So definitely, I think the reason they want a political solution and a car czar is because a car czar can protect the unions through this whole process at the expense of the taxpayer.”

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Most big banks are bankrupt - Jim Rogers

By Jonathan Stempel

NEW YORK (Reuters) - Jim Rogers, one of the world's most prominent international investors, on Thursday called most of the largest U.S. banks "totally bankrupt," and said government efforts to fix the sector are wrongheaded.

Speaking by teleconference at the Reuters Investment Outlook 2009 Summit, the co-founder with George Soros of the Quantum Fund, said the government's $700 billion rescue package for the sector doesn't address how banks manage their balance sheets, and instead rewards weaker lenders with new capital.

Dozens of banks have won infusions from the Troubled Asset Relief Program created in early October, just after the Sept 15 bankruptcy filing by Lehman Brothers Holdings Inc (LEHMQ.PK: Quote, Profile, Research, Stock Buzz). Some of the funds are being used for acquisitions.

"Without giving specific names, most of the significant American banks, the larger banks, are bankrupt, totally bankrupt," said Rogers, who is now a private investor.

"What is outrageous economically and is outrageous morally is that normally in times like this, people who are competent and who saw it coming and who kept their powder dry go and take over the assets from the incompetent," he said. "What's happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics.

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TARP to the rescue

Just when you thought the bailout was rightfully dead in the water, what a surprise that the White House and Hank Paulson show up with Federal Reserve Notes in hand. This only proves the case that the administration is bought and paid for, considering they were staunchly against this bill just days ago. Oh how things change when you have a UAW gun pointed to your head! After all, the UAW funded many of these guys' campaigns.

This is yet another stark reversal for the Treasury, who has been strongly against giving the taxpayer giveaway to anyone except those in the financial sector (or those who are best friends with Paulson and Bernanke). We can't be that surprised; this isn't the first time that the Treasury has changed it's mind on something, further proving that they A) don't have the slightest clue as to what they are doing or B) are not working for the taxpayers at all, they are merely puppets for the real shot-callers in this country. I tend to believe it's both.

Bailout? More like failout.

Looks like the the Senate finally grew a pair and stood up to the unions. Leading the charge is Bob Corker (R-TN), who seems to be one of a few in Washington that knows the real problem facing the Big 3 and actually has a spine. Everything out of Bob's mouth has made absolute sense, perhaps too much sense for thick-headed House democrats, but I digress.

Now that the current bill is dead in the water, here comes the fear mongering. Harry Reid has stated that he "dreads Wall Street's reaction today." I'm sorry Mr. Reid, but you and your confidants just spent weeks speaking against Wall Street and the bank bailout, yet now you are afraid of the effect on Wall Street? That's strange indeed.

I don't doubt that the Dow will plunge several hundred points today, throwing gas on the fire. We've all seen this picture before; in response, the Dems will run around with their heads cut off, demanding that the Republicans pass a new version of the bill or else the country will descend into a black hole. Does this sound familiar? I believe it does. Lets just hope that somebody, ANYBODY, in Congress is smart enough to stop it this time around.

I'm not holding my breath.

UPDATE: The Dow is open and down less than 100 points. So much for Harry Reid's scare tactics.

"Car czar"

I'd like to address this idea of a "car czar." The "car czar" is featured in the Auto bailout bill as the person to oversee the industry and make sure the loans that will undoubtedly be granted are paid back to the American taxpayer. Or that is what we are told, anyway. However, it goes way beyond simple "oversight."

"The car czar would have say-so over any major business decisions by the automakers while they were taking advantage of federal aid, with veto power over any transaction of $100 million or more. The companies — including the private equity firm Cerberus, which owns a majority stake in Chrysler — would have to open their books to the government overseer.And if Chrysler defaulted on its loan, Cerberus would be responsible for reimbursing the government."

What does this mean? It means that this person, who is appointed by the President and not elected by the people, mind you, will have his or her hands in virtually everything GM, Ford, or Chrysler does. He will be responsible for telling the industry what cars to make, how to make them, where to make them, and what technologies they should include in them. Does anyone see a problem with this? Since when has a government-appointed bureaucrat ever done anything successful?

Barney Frank notes that "at least this appointee is accountable to the President, where a bankruptcy lawyer is accountable to no one." Hmm, is a bankruptcy lawyer going to be determining the product mix of the Big 3? I think not Mr. Frank.

Another argument by Frank is that "the Big 3 can opt out of the Federal loans at any time, or choose not to accept them at all if they think the car czar mandates are too restricting." That's all well and good Mr. Frank, but that doesn't mean this appointee will do any good. It's clear that the Big 3 want the government's help, but if you're going to put up $15 billion in taxpayer funds, wouldn't it be in the best interest of Congress to at least give them a chance to succeed? Giving them the money and at the same time seizing any chance of control is a ridiculous waste of time and money.

The main power of the "car czar" is that he or she can force the companies into bankruptcy at any time if they don't comply with the government's demands, or if their plan is not working. Lets put ourselves in the position of the "car czar" for a moment. If I am appointed as a "car czar" and the companies are still failing miserably, am I going to force them into bankruptcy, thus eliminating the need for my cushy job in Washington? Of course not! Why would I? Does anyone in Congress think about that? Does Mr. Frank have the intellect to foresee that scenario? Of course not, because Mr. Frank has no more knowledge of how free markets work than your average housecat.