Liquidating the Empire

So Treasury Secretary Andrew Mellon advised Herbert Hoover in the Great Crash of '29.

Hoover did. And the nation liquidated him – and the Republicans.

In the Crash of 2008, 40 percent of stock value has vanished, almost $9 trillion. Some $5 trillion in real estate value has disappeared. A recession looms with sweeping layoffs, unemployment compensation surging, and social welfare benefits soaring.

America's first trillion-dollar deficit is at hand.

In fiscal year 2008 the deficit was $438 billion.

With tax revenue sinking, we will add to this year's deficit the $200 to $300 billion needed to wipe the rotten paper off the books of Fannie and Freddie, the $700 billion (plus the $100 billion in add-ons and pork) for the Wall Street bailout, the $85 billion to bail out AIG, and $37 billion more now needed, the $25 billion for GM, Chrysler, and Ford, and the hundreds of billions Hank Paulson will need to buy corporate paper and bail out banks to stop the panic.

As Americans save nothing, where are the Feds going to get the money? Is the Fed going to print it and destroy the dollar and credit rating of the United States? Because the nations whose vaults are full of dollars and U.S. debt – China, Japan, Saudi Arabia, the Gulf Arabs – are reluctant to lend us more. Sovereign wealth funds that plunged billions into U.S. banks have already been burned.

Uncle Sam's Visa card is about to be stamped "Canceled."

The budget is going to have to go under the knife. But what gets cut?
WAR ON YOU

The financial crisis: The price of stability

America's Treasury asks Congress for $700 billion to stabilise the markets

UNTIL this week America's authorities clung to the hope that they could tide over the financial system with a few loans until home prices stabilised and all the bad debts were accounted for. But the destruction visited on Wall Street in the past week has dashed those aspirations and forced policymakers to consider a more sweeping response. The bankruptcy of Lehman Brothers and AIG’s federal takeover have triggered a wholesale flight to safety that could turn illiquid institutions insolvent. Healthy corporations can no longer issue bonds. Banks can barely borrow from each other.

The federal government, having lent hundreds of billions of dollars to banks and investment banks and AIG, now thinks it must put permanent capital into the financial system to restore confidence and stop the vicious spiral. Hank Paulson, the treasury secretary, and Ben Bernanke, chairman of the Federal Reserve, met Congressional leaders towards the end of the week. And on Saturday September 20th Mr Paulson sent a preliminary plan under which the federal government would be authorised to purchase up to $700 billion of "residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages" originated or issued on or before Wednesday. It could buy them from any financial institution headquartered in the United States. ...

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[Source: The Economist: News analysis

Pakistan and America: How to beat the terrorists?

The leaders of America and Pakistan are set to meet, as tensions grow between the two countries

PRESIDENT George Bush and his Pakistani counterpart, Asif Zardari, were due to hold their first official meeting on Tuesday September 23rd at the sidelines of the United Nations General Assembly in New York. The American president and Mr Zardari face a common challenge: a Taliban insurgency is burgeoning in both Afghanistan and Pakistan, and al-Qaeda continues to pose a threat from sanctuaries in the two countries’ border areas.

That threat was underscored by a massive suicide bomb-attack on a hotel in Islamabad at the weekend that killed at least 53 people and wounded more than 260. Footage from security cameras showed a tarpaulin-covered truck, which was laden with bricks, sand, rounds of ammunition and 600kg of high-grade TNT and RDX explosives, rumbling into the security gates of the Marriott Hotel. Hapless guards dithered after the driver first detonated a minor explosion. The main blast kicked-in four minutes later leaving nothing but a crater 30ft (9m) deep. It pulverised the landmark international hotel, which was gutted after being engulfed in flames. ...

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[Source: The Economist: News analysis

Awash In Profits, Exxon Extracting Every Penny From Its Franchisees

Every time Sohaila Rezazadeh rings up a sale at her Exxon station on Chain Bridge Road in Oakton, her cash register sends the information to Exxon Mobil’s central computers. If she raises the price of gasoline a couple of pennies, chances are that Exxon will raise the wholesale price she pays by the same amount.Through [...]

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[Source: War On You

Australia's budget

Tax cuts in Labor's first budget

Australia's Labor government unveiled its first budget on May 13th. The new government's main goals in crafting the budget were to reward the electorate with tax cuts and to keep spending under control in order to curb inflation. A raft of tax breaks and benefits, especially for working-class households, will shift some of the tax burden to high-income earners while reducing taxes overall by A$46.7bn (US$43.5bn) over the next four years. At the same time, government spending is set to increase only by a modest 1.1%, resulting in a projected budget surplus of A$21.7bn. The government also plans to delay a significant portion of its spending until next year, when both economic growth and inflation are set to ease.

The 2008/09 budget represents the new Labor administration's first difficult policy test. Since taking office after winning the federal election in November, the prime minister, Kevin Rudd, has fulfilled several high-profile election pledges?including an official apology to Aborigines, ratification of the Kyoto protocol on greenhouse-gas emissions and a decision to reduce military involvement in Iraq. These measures demonstrated that the new government is more in touch with the electorate, but they were successes in part because they produced a "feel-good" effect without requiring immediate sacrifices. Crafting a budget that would fulfil campaign pledges to cut taxes while keeping inflation under control was a task of a different order, presenting genuine dilemmas as the government sought to balance the interests of various political constituencies and conflicting economic imperatives. ...

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[Source: The Economist: News analysis

Feds Accuse Student Of Terror and Espionage For Talking About Constitution

A student of a large bible college in east Texas was accused by federal agents of committing an “act of terror and espionage” after he gave a talk to a group of Boy Scouts in which he encouraged them to educate themselves about the U.S. constitution.Jeff, who wishes to remain anonymous at present, is a [...]

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[Source: War On You

Bill Maher: The Pope is Coming to America, Parents Lock Up Your Kids!

Bill Maher’s final “New Rule” from Real Time.New Rule: Whenever you combine a secretive compound, religion and weirdos in pioneer outfits, there’s going to be some child-f*cking going on. In fact, whenever a cult leader sets himself up as “God’s infallible wing man” here on earth, lock away the kids.Which is why I’d like to [...]

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[Source: War On You -