What’s Coming Next, or Is Collapse Over, Nope!

(9 am. – promoted by ek hornbeck)

I’m not an economist and the only real numbers I crunch are my personal expenses and when bidding construction jobs putting together those costs and percentages which in these latter years of my life, preferring more to do the work, I have done very little of, except while doing the work to bring a better quality for hopefully a bit cheaper cost in material and professional skill.

Watching what is now taking place in banking and the dream new capitalist economy that’s been sold for a number of years isn’t really a big surprise to this common man, many were forecasting exactly what would happen if we followed the sales pitch.

Following is a report from CBS that hits on the next shoe to drop or dropping already as we’ve seen with the collapse of a number of finance institutions but not yet talked about but part of what we the tax payers are already bailing out.

CBS News Investigates: Credit Derivatives Comprise $54.6 Trillion Of Risk Among Few Banks Left Standing

“This bill will, in my judgment, raise the likelihood of future massive taxpayer bailouts. …if you want to gamble, go to Las Vegas. If you want to trade in derivatives, God bless you.”

That was North Dakota Senator Byron Dorgan’s statement on the floor of the Senate – not this week or last, or even during the last six months as Wall Street collapsed – but back in 1999.

Four years later in a letter to shareholders, billionaire investor Warren Buffett followed with his own warning, calling derivatives “weapons of financial mass destruction” controlled by “madmen.”

Steve Kroft looks at some of the arcane Wall Street financial instruments that have magnified the economic crisis.

What worries financial insiders most is the $54.6 trillion of risky credit derivatives concentrated among the few banks left standing.

Today, the same commercial banking heavyweights thought to be the most safe, JPMorgan, Citigroup Inc. and Bank of America, hold 92 percent of all the disclosed credit derivative contracts, according to the Office of the Comptroller of the Currency {PDF}.

There’s another huge storm on the horizon, we’ve already been experiencing for many years but ignoring the size of the detestation coming. we’ve been sold another bill of goods, mostly by one particular political party, the GOP, and that bill of goods has been the thought process that a Nation in Deficit is a strong financial situation, much of those deficits monies heading into the pockets of the private sector while we the tax payer pay the monies needed and the ever rising interest accumulated as we borrow from other nations. They sold it so well that many think it’s perfectly fine to live their own lives in personal deficit, using free wealth, Plastic and Loans!

CONSUMER CREDIT OUTSTANDING

The Next Meltdown: Credit-Card Debt

Rising rates are accelerating credit-card defaults and soured debt could further undermine the financial system

There’s a video at the Business Week site above as well, and instead of talking about what may be coming, as to consumer debt, they talk about which cards are better for you, still selling the hype!

Federal Reserve Statistical Release

Standard of living squeezes middle class

Credit card and other consumer debt, not counting the dramatic growth in mortgages, has soared 150% since 1994, more than four times faster than inflation, …

Ron and Laurie Kopack are educated, hard-working suburban Detroit homeowners who, by American middle-class standards, should have earned comfortable family evenings, a little peace of mind and a few luxuries. Instead, they are struggling.

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Ron, an electrician, spent most of his summer living in a tent city while doing flood repairs in Iowa because he couldn’t find work at home. Laurie, who just got a bachelor’s degree but is paid only $15 per hour, faces $30,000 in student debt and a teenager coming of age with his dad often gone.

“The whole American dream, that’s a snow job,” Laurie says. “I mean, who tried to sell us that? Is that to keep us good consumers?”

The Credit Card Debt tsunami already breaking over us and how to fix it

Overall, Americans today carry $2.6 trillion in all kinds of consumer debt, up 24% from just 2003, according to the Federal Reserve.

We once had a Nation, not long ago, and never really worked completely right, but was on the road heading in what looked liked the right direction. We were envied around the world for our work force and products. Top executives made more money if their companies made better profits. Innovation came from employee’s, long term, who through their hard work, dedication, and regular wage increases gave to their companies, second families, what was needed to enhance that companies reputation and customer satisfaction, building better profit margins. Investors were usually long term and as the companies grew saw their investments increase through regular dividends and reaped their gamble when selling usually when near or in retirement.

We shunned and condemned extreme profiteers and shady business practices geared for quick wealth of a few, we stopped doing business with companies that took short cuts in what they offered, products and services thus bringing them down and raising up further those that worked for their good reputations.

No longer, we’ve made a u-turn on that direction and now praise and hold up as successful those who we once shunned and condemned. They started using relatively simple schemes with little catch phrases and words to gain quick extreme wealth and stature in the society they were setting up, the workers became just bodies carrying out what was needed in the ever changing schemes, coming on quick enough so they weren’t recognized as such.

We didn’t stop what was happening, we readily joined in, many thinking that what was great for the few would somehow touch them as well raising them up to those lofty ranks, we even built lives around the coming rise, much of it on borrowed monies, living beyond the reality we really had.

What will rise out of the collapse of that which we built, or will anything rise!

3 comments

    • jimstaro on October 12, 2008 at 5:21 pm
      Author

    the bin Ladens of the World, have won, as the economies of the advanced Collapse!

    • Edger on October 12, 2008 at 6:45 pm

    is that even if the bullshit salesmen can convince people to buy their bullshit, when they get it home and unwrap the pretty packaging it turns out to still be bullshit, and it stinks, and nobody else wants it.

  1. marketed and implemented this ‘life style’ via the DLC and the New World Order. Instead of rising boats the people are awash in debt. I have friends and relatives who have taken money out of their house and live via credit cards. They do not live outrageously lavish life styles but are caught in a Dream that offers them not a share in the wealth, but stagnate wages, cheap stuff produced by slave labor, and erections for all.

    Changing the perceptions of this world view is going to be hard. If you have tethered your life to your credit rating, and believe that the ultimate success is granite counter tops, super sized appliances and a Mc Mansion with a huge SUV parked in the driveway the reality that is crashing down is going to be harsh. There is no middle class any more, no ‘main street’, just Big Boxes and car lots full of dinosaurs.

    My husband and I have for years been the object of pity and ridicule from these relatives as we had no credit cards, no stainless steel appliances or investments. We broke down and got credit cards because our credit rating was horrific not because of debt but from the lack of it. The mainstream punishes those who dare to live with cash. Can Americans let go of this mindset? Can they demand jobs that pay enough to live on? Will they still believe that outsourcing is necessary and we deserve cheap shit produced by slave labor because were exceptional? Or will they cling to the concept of buying stuff on the ‘never never’ as my grandmother used to call buying with credit.

             

             

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