It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
The illusion of control is control for most and they are secure with it. We look to our governments to become mommy and daddy, to make the big bad boogie men go away. We do not have a clue as to how fragile economies are, much like our lives on this planet. We hand over control and trust politicians to guide us through life, even though politicians are the most untrustable creatures on the face of the earth. The divisiveness of modern politics is so emotional and cruel that their campaigns focus on fear to drive you-the cattle-to herd to where they want you to go. A cattle prod of fear and emotion is the best weapon ever devised as logic always takes a back seat to that ignorance and wrong-headed decisions made under the influence of fear.
We have allowed this “republic” to become far beyond the “military-industrial complex” of the Eisenhower age. We are now a quasi-Fascist/industry-socialist/forcibly religious prisoners of our own fear. The meltdown of the financial systems stems from the repeal of the Glass-Steagal Act with the Gramm-Leach-Bliley Act and the loosening and eliminating of regulation at a time when computer trading and incredible computer speed allowed derivatives and exotic financial instruments to seek and plunder pennies on dollars for millions per day.
It gets worse. The current fiasco is not just Freddie and Fannie; it is the massive amount of CDO’s or mortgage-backed securities that were a derivative invented by Goldman Saks whose CEO at the time was Hank Paulson. This is squarely what is causing the meltdown. It is the lack of being able to price these CDO’s that has caused the run on the investment banks that bought billions of dollars of them. It is the deregulation (again Greenspan) that allowed these financial instruments that were based on ‘home values never going down’ that is the root cause. Paul Volcker, the previous Fed Chairman warned of this deregulation at that time but no one listened. Those CDO’s are now illiquid and the ‘shorts’ have gone after those investment banks that hold these securities to make massive amounts of money while they bring these institutions down. I warned of this many months ago. This is not just about donkeys and elephants.
CDO’s should have never been allowed to be created. Remember Greenspan’s 1% interest rate meant investment banks needed more return on their money. Goldman’s CDO’s allowed the high returns that made them millions until the builders jacked up prices (my wife worked for one and they raised a house that cost 275,000 to 500,000 and then to 750,000 as the rates went lower) and then when FUBAR Greenspan made a speech to Congress (I heard it at with my own ears at the time) telling everyone to buy into a 3-Year ARM, then 6 months later began to raise rates, the obvious happened. People had bought too much house at too little interest. Speculative investors bought in to the ‘home values never going down’ myth and expected big dollars in flipping…….but I will tell you this much; I know of many families out in the street right now because they have lost jobs the same time as their mortgage rates doubled. It is a crisis, and it’s not about minorities, these are middle class heart of America people that are homeless, broke, or moving into apartments because they lost their house. You may not have sympathy for them, but for the grace of God there walks us all.