Bailout failure will cause US crash

The bailout has already failed, because it cannot not fail. Now nobody will laugh anymore at Ron Paul who predicted all of this chaos a long time ago.

Do you remember this article? Fortis Bank Predicts US Financial Market Meltdown Within Weeks
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The US stock market could suffer a devastating crash with shares losing a third of their value this week if Hank Paulson’s financial bailout plan fails, US Treasury officials have warned.

The financial system could face a meltdown of 1929 proportions unless US politicians succeed in their efforts for a $700bn rescue scheme, experts added.

The warning came as Republicans and Democrats met in Washington for a rare weekend debating session to attempt to seal agreement on the contentious plan, aimed at preventing a long-lasting recession in the US.

Officials close to Paulson are privately painting a far bleaker portrait of the fragility of the global economy than that advanced by President George W Bush in his televised address last week.

One Republican said that the message from government officials is that “the economy is dropping into the john.” He added: “We could see falls of 3,000 or 4,000 points on the Dow [the New York market that currently trades at around 11,000]. That could happen in just a couple of days.

“What’s being put around behind the scenes is that we’re looking at 1930s stuff. We’re looking at catastrophe, huge, amazing catastrophe. Everybody is extraordinarily scared. It’s going to be really, really nasty.”

Read moreBailout failure will cause US crash

BAILOUT: Ron Paul Educates Bernanke…yet again 9/24/2008


Source: YouTube

Wednesday, September 24, 2008

Dear Friends,
Whenever a Great Bipartisan Consensus is announced, and a compliant media assures everyone that the wondrous actions of our wise leaders are being taken for our own good, you can know with absolute certainty that disaster is about to strike.
The events of the past week are no exception.
The bailout package that is about to be rammed down Congress’ throat is not just economically foolish. It is downright sinister. It makes a mockery of our Constitution, which our leaders should never again bother pretending is still in effect. It promises the American people a never-ending nightmare of ever-greater debt liabilities they will have to shoulder. Two weeks ago, financial analyst Jim Rogers said the bailout of Fannie Mae and Freddie Mac made America more communist than China! “This is welfare for the rich,” he said. “This is socialism for the rich. It’s bailing out the financiers, the banks, the Wall Streeters.”
That describes the current bailout package to a T. And we’re being told it’s unavoidable.
The claim that the market caused all this is so staggeringly foolish that only politicians and the media could pretend to believe it. But that has become the conventional wisdom, with the desired result that those responsible for the credit bubble and its predictable consequences – predictable, that is, to those who understand sound, Austrian economics – are being let off the hook. The Federal Reserve System is actually positioning itself as the savior, rather than the culprit, in this mess!

  • The Treasury Secretary is authorized to purchase up to $700 billion in mortgage-related assets at any one time. That means $700 billion is only the very beginning of what will hit us.
  • Financial institutions are “designated as financial agents of the Government.” This is the New Deal to end all New Deals.
  • Then there’s this: “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.” Translation: the Secretary can buy up whatever junk debt he wants to, burden the American people with it, and be subject to no one in the process.

There goes your country.
Even some so-called free-market economists are calling all this “sadly necessary.” Sad, yes. Necessary? Don’t make me laugh.
Our one-party system is complicit in yet another crime against the American people. The two major party candidates for president themselves initially indicated their strong support for bailouts of this kind – another example of the big choice we’re supposedly presented with this November: yes or yes. Now, with a backlash brewing, they’re not quite sure what their views are. A sad display, really.
Although the present bailout package is almost certainly not the end of the political atrocities we’ll witness in connection with the crisis, time is short. Congress may vote as soon as tomorrow. With a Rasmussen poll finding support for the bailout at an anemic seven percent, some members of Congress are afraid to vote for it. Call them! Let them hear from you! Tell them you will never vote for anyone who supports this atrocity.
The issue boils down to this: do we care about freedom? Do we care about responsibility and accountability? Do we care that our government and media have been bought and paid for? Do we care that average Americans are about to be looted in order to subsidize the fattest of cats on Wall Street and in government? Do we care?
When the chips are down, will we stand up and fight, even if it means standing up against every stripe of fashionable opinion in politics and the media?
Times like these have a way of telling us what kind of a people we are, and what kind of country we shall be.
In liberty,
Ron Paul

Govt. Report Says Fluoride Added to Water Supply May Harm Population

(NaturalNews) A government-sponsored report has concluded that levels of fluoride that people are regularly exposed to in drinking water can cause serious malfunctioning of the thyroid gland, leading to even more serious health problems.

“A low level of thyroid hormone can increase the risk of cardiac disease, high cholesterol, depression, and, in pregnant woman, decreased intelligence of offspring,” said study co-author Kathleen Thiessen.

The comprehensive review of the scientific literature on fluoride exposure and thyroid toxicity was conducted by a panel appointed by the National Research Council of the National Academies (NRC). It found that fluoride exposure was associated with low levels of thyroid and parathyroid hormones, and an abnormally enlarged thyroid gland (goiter). They also found that fluoride tended to concentrate in the thyroid more than in any organ but the kidneys.

“Fluoride has detrimental effects on the thyroid gland of healthy males at 3.5 mg a day. With iodine deficiency, the effect level drops to 0.7 milligrams a day for an average male,” said Robert Carton, an environmental scientist with 30 years of experience working for the government.

Read moreGovt. Report Says Fluoride Added to Water Supply May Harm Population

Bailouts Will Push US into Depression


Source: YouTube

The end result of the global economic slowdown may be the U.S. announcing national bankruptcy as the government cannot afford the bailouts that it promised and the market will not bail out the government, Martin Hennecke, senior manager of private clients at Tyche, told CNBC on Thursday.

“We expect a depression in the United States. We expect a depression, very possibly, also in Europe,” Hennecke said on “Worldwide Exchange.”

The estimated $300 billion cost of the Fannie/Freddie bailout will probably be considered as a loss that the government will have to take, therefore passing it on to taxpayers, he explained.

“We already have $3 trillion of debt, as far as the U.S. government is concerned. These debt figures across the U.S. economy are rising very sharply.”

When the government can no longer pass the United States’ “immense debt” on to taxpayers, it will turn to the holders of U.S. dollars, leading to the eventual downfall of the currency, Hennecke said.

“Definitely, it (the dollar) is not a safe place to be invested in, as real inflation is closer to 10 or 11 percent than the actual inflation numbers given by the U.S. government,” Hennecke said on “Worldwide Exchange”.

Investors should avoid exposure to debt and stay away from leveraging on any investment or asset, including property, Hennecke advised, adding that “banks have been too highly leveraged in the past, private households, everybody.”

Hennecke’s stock allocations are mainly Asian-based, especially in the Chinese market as the country’s government has a large amount of cash and the macroeconomics are fundamentally strong.

He also suggested investing in gold, despite the recent fall in price.

11 Sep 2008

Source: CNBC

Why Government Bailout Of Fannie And Freddie Will Fail

With yesterday’s announcement of the most massive federal bailout of all time, it’s now official: Fannie Mae and Freddie Mac, the two largest mortgage lenders on Earth, are bankrupt.

Some Washington bigwigs and bureaucrats will inevitably try to spin it. They’ll avoid the “b” word with vengeance. They’ll push the “c” word (conservatorship) with passion. And in the newspeak of 21st century bailouts, they’ll tell you “it all depends on what the definition of solvency is.”

The truth: Without their accounting smoke and mirrors, Fannie and Freddie have no capital. The government is seizing control of their operations. Their chief executives are getting fired. Common shareholders will be virtually wiped out. Preferred shareholders will get pennies. If that’s not wholesale bankruptcy, what is?

Read moreWhy Government Bailout Of Fannie And Freddie Will Fail

U.S. House Price Decline Could Be Worse than Great Depression, Economist Shiller Says

Eight years ago, Yale superstar professor and MacroMarkets chief economist Robert Shiller famously called the top of the stock market in his book Irrational Exuberance. Then, a year before the housing bubble peaked, he predicted the colossal bust we are now experiencing.

If you recognize Shiller’s name, it’s because the Standard & Poor’s/Case-Shiller home price indexes, which he developed with Wellesley College economist Karl Case, have become the nation’s most authoritative source for home price trends.

In part one of my one-on-one with Shiller, we discuss the grim outlook for U.S. housing, which he tackles in-depth in his new book The Subprime Solution. Highlights of our first discussion include:

  • Home price declines are already approaching those in the Great Depression, when they plunged 30% during the 1930s. With prices already down almost 20%, it’s not a stretch to think we might exceed that drop this time around.
  • There are about 10 million homeowners whose debt is higher than their home value, which has broad implications for how Americans feel about their wealth and spending habits (read: more pressure on consumer spending).
  • The current hopeful consensus — that house prices will bottom soon and then begin to recover — is most likely a dream. Housing markets don’t usually have “V-shaped” recoveries. And even if house prices stabilize in nominal terms, after adjusting for inflation, most homeowners will continue to lose money.

    Read moreU.S. House Price Decline Could Be Worse than Great Depression, Economist Shiller Says

U.S. Food and Water Supply Poisoned by Perchlorate

(NaturalNews) According to a report by the Organic Consumers Association, a toxic chemical that is a byproduct of rocket fuel is rapidly poisoning the food and water supply in the United States. Known as perchlorate, this chemical has been found in 93% of the nation’s milk and lettuce supply in a recent FDA study. It has also been found in the drinking water for at least 22 states at extremely alarming levels. Perhaps the scariest statistic is that perchlorate has been found in the breast milk of 97% of the mothers who were tested.

What are Americans supposed to eat?

Unfortunately, lettuce and milk weren’t the only foods that were found to be contaminated. Perchlorate was found in tomatoes, carrots, cucumbers, spinach, citrus, melons and more. Sadly, even organic vegetables were affected, because most crops are irrigated from polluted water sources. In a Wired.com article by Amit Asaravala, Bill Walker, the vice president of the Environmental Working Group’s West Coast operations, was quoted as saying, “The study confirms what we and some other people have been saying for a while — that perchlorate is not only a problem in areas with known water contamination but for anyone who eats food grown in the U.S.”

Read moreU.S. Food and Water Supply Poisoned by Perchlorate

The United States of America is the Next Argentina

DON’T CRY FOR ME ARGENTINA SAVE YOUR TEARS FOR YOURSELF – While bankers do control the issuance of credit, they cannot control themselves. Bankers are the fatal flaw in their deviously opaque system that has substituted credit for money and debt for savings. The bankers have spread their credit-based system across the world by catering to basic human needs and ambition and greed; and while human needs can be satisfied, ambition and greed cannot-and the bankers’ least of all.

I have a bad feeling about what’s about to happen. The Great Depression is the closest that comes to mind. I, like most, was not alive during the 1930s when it happened. Nonetheless, what once was feared in private is now being discussed in public. It’s going to be bad. It’s going to make high school seem like fun.

THE UNITED STATES OF AMERICA THE NEXT ARGENTINA

This Time is Different: A Panoramic View of Eight Centuries of Financial Crises by University of Maryland‘s Carmen Reinhart and Harvard’s Kenneth Rogoff makes for perfect reading when flying between the US and Argentina.

There is perhaps no better analysis than Reinhart and Rogoff’s on the history of sovereign defaults; and, as such, Reinhart and Rogoff’s paper was ideal reading material when traveling between the US and Argentina , for the sovereign defaults that happened in the past to Argentina will soon be happening to the US .

Read moreThe United States of America is the Next Argentina

The Big Sting Two

By Bob Chapman

The plan for an economic takedown, the results of rampant market speculations, insiders picking up assets for pennies on the dollar, the coming hyperinflation, the credit crunch, collapse of the dollar carry trade, suppression of metals prices, American meddling in Georgia

Read moreThe Big Sting Two

Jim Rogers Predicts Bigger Financial Shocks

VANCOUVER, B.C. – The U.S. financial crisis has cut so deep – and the government has taken on so much debt in misguided attempts to bail out such companies as Fannie Mae (FNM) and Freddie Mac (FRE) – that even larger financial shocks are still to come, global investing guru Jim Rogers said in an exclusive interview with Money Morning.

Indeed, the U.S. financial debacle is now so ingrained – and a so-called “Super Crash” so likely – that most Americans alive today won’t be around by the time the last of this credit-market mess is finally cleared away – if it ever is, Rogers said.

Read moreJim Rogers Predicts Bigger Financial Shocks

Report: Obama, Potential Iran Attack, Financial Collapse

Published for some of the information on the economy.


Added: August 02, 2008

Source: YouTube

Borrowings of Depository Institutions from the Federal Reserve

Ready for a little shock? Link

A reader has discovered this on Digg: “This is how fucked we are

That says it all.

Related article: Stressed banks borrow record amount from Fed
What does it mean if you have such a huge “shortage of liquidity in your system”?
Hmmmhhh?!? Oh! Run, run, run.

According to the FDIC I am just another blogger creating fear in the marketplace, so don’ t worry.

You can trust the government on this:

WASHINGTON, July 22 (Xinhua)
U.S. Treasury Secretary Henry Paulson said Tuesday that the U.S. banking system is sound and the long-term fundamentals of economy are strong.

December 5, 1929
“The Government’s business is in sound condition.” — Andrew W. Mellon, Secretary of the Treasury

More Quotes from the Great Depression:

Read moreBorrowings of Depository Institutions from the Federal Reserve

Is America too big to fail?

NEW YORK: In the narrative that has governed American commercial life for the last quarter-century, saving companies from their own mistakes was not supposed to be part of the government’s job description. Economic policymakers in the United States took swaggering pride in the cutthroat but lucrative form of capitalism that was supposedly indigenous to their frontier nation.

Read moreIs America too big to fail?

Bernanke, Paulson Pressed to Seek Big-Government Bank Bailout

July 21 (Bloomberg) — Ben S. Bernanke and Henry Paulson are under pressure to embrace the big-government policies of America in the 1930s, or Sweden in the 1990s, to contain the conflagration engulfing the U.S. housing and financial markets.

Among the ideas: Using taxpayer money to shore up the capital of loss-ridden Fannie Mae and Freddie Mac, setting up new agencies to buy and refinance mortgages in default, even taking over failing financial institutions.

The government’s current “fire-brigade approach to dealing with the fallout from the extremely weak domestic economy is eroding general confidence in the U.S. financial system,” says Brian Bethune, chief U.S. financial economist at Lexington, Massachusetts-based Global Insight. “Bold, creative, aggressive policy action is needed.”

Read moreBernanke, Paulson Pressed to Seek Big-Government Bank Bailout

U.S. Financial Breaking Point Soon

Something is going to break, and soon. Banks are insolvent and failing by the hundreds if not thousands. Hedge funds are on the edge of oblivion. Only a tiny percentage of toxic waste losses in real estate and other asset classes of collateral, which will eventually amount to over $1.4 trillion in the US alone, has to date been recognized by the lying bankster fraudsters. Bonds are producing negative rates of return even based on ludicrously understated official rates of inflation (until this month, when we finally got some data bordering on the truth).

Read moreU.S. Financial Breaking Point Soon

Five Years Late and a Trillion Dollars Short

On Tuesday, the SEC issued an emergency rule in an attempt to curb naked short selling in 19 major financial institutions, including Goldman Sachs, Morgan Stanley, Citigroup, and JP Morgan Chase and Company.

Read moreFive Years Late and a Trillion Dollars Short

This recession could easily tip into a depression

The experience of the 1930s makes me think that the present downturn will be relatively long and difficult

Today I am celebrating my 80th birthday, an age that seems less formidable when one has reached it than when one can see it only from afar.

I was born on July 14, 1928, about 15 months before the American boom of the 1920s came to its rather abrupt end. Like everyone else, I am naturally curious to see whether the global credit crunch is going to be a brief interruption in global prosperity, or the prelude to a longer and deeper depression.

I cannot claim to have clear memories of the 1929 Wall Street Crash, which occured when I was 1year old, or of Britain leaving the gold standard in 1931, when I was 3 years old.

I do however, remember newspaper articles about the later stages of the Depression. In the 1930s, my parents read The Times, the Financial Times and the Daily Mail.

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US: Total Crash of the Entire Financial System Expected, Say Experts
The Dollar is doomed and the Fed will fail
Fannie, Freddie insolvent, Poole tells Bloomberg
Foreclosures Rose 53% in June, Bank Seizures Triple
Small Banks: Billions in Troubled Construction Loans
Financial market losses could top 1,600 billion dollars: report
Dow suffers worst 1st half since ‘70
Fortis Bank Predicts US Financial Market Meltdown Within Weeks
Barclays warns of a financial storm as Federal Reserve’s credibility crumbles
Jim Rogers: Avoid The Dollar At All Costs
Ron Paul on Iran and Energy June 26, 2008
Marc Faber: ‘Misleading’ Fed Should Let Banks Fail

I can remember the news stories of the Jarrow march of the unemployed. I also remember discussing with my mother a lead story which reported that farm workers’ pay was to be raised 6d (2p) to what would now be £1.50 a week. The depression was a fact of existence in the North Somerset coalfield up to the outbreak of war in 1939.

Fortunately, there has only been one Great Depression in my lifetime, but there has also been a Great Inflation. In 2006 Pickering and Chatto, which I refounded in the 1980s, had the good timing to publish a three-volume History of Financial Disasters, under the general editorship of Mark Duckenfield.

Read moreThis recession could easily tip into a depression

US: Total Crash of the Entire Financial System Expected, Say Experts

Investors are fleeing from the U.S. stock market, Sending the Dow to Worst June Since Depression, looking for places to secure their wealth.

There is an unprecedented cash flow of ‘hot money’, which is usually defined as short-term global speculative funds moving among financial markets in search of the highest short-term return, moving into China:
Is China flooded with ‘hot money’ because of an expected meltdown in the U.S.?

Let’s further examine the prospects that we would experience a total crash of the entire financial system:

Fortis Bank Predicts US Financial Market Meltdown Within Weeks

We have seen the Dow suffering it’s worst 1st half since ‘70 accompanied by a lot of bad news for the economy like:
US: Big Trouble for General Motors, Crysler and Ford
America’s Aviation System About To Collapse
Starbucks to cut as many as 12,000 positions
And now the corporations are cheating you at the supermarkets: America’s Shrinking Groceries

The Dollar is being destroyed by the Federal Reserve, which has created in the last three years 4 Trillion Dollars of new money out of thin air: Ron Paul on Iran and Energy June 26, 2008

Ron Paul is further warning that: This coming crisis is bigger than the world has ever experienced
and that: We are at the beginning of a huge Dollar bubble.

The US Federal Reserve intentionally created inflation and that is why its credibility has fallen “below zero” and that is why Barclays warns of a financial storm as Federal Reserve’s credibility crumbles.

More dire warnings:
RBS issues global stock and credit crash alert
Morgan Stanley warns of ‘catastrophic event’ as ECB fights Federal Reserve
Central bank body warns of Great Depression
Credit crisis expands, hitting all kinds of consumer loans
How Low Can The Dollar Go? Zero Value

Investors like Jim Rogers are telling us to “Avoid The Dollar At All Costs” and have told us that the Federal Reserve will fail and that Bernanke should be fired (alhough that isn’t possible because of his contract), because he has created the worst recession in the end and thats why he said: “Abolish the FED” on CNBC 2008.03.12.

The Fed is only doing good for the big corporations on Wall Street. If you would continuously come close to bankruptcy, because you have irresponsibly wasted your money, who will continuously give you billions of Dollars and bail you out, because you might fail? So I agree totally with Marc Faber: ‘Misleading’ Fed Should Let Banks Fail.

Well those corporations are said to be to “Big to Fail”, but they eventually will fail, because the entire system will fail and the Dollar is being destroyed in the process and so the people will end up with nothing, because their life savings are worthless paper. You are already paying the price for this policy, but maybe you haven’t looked at it that way:
The Price Of Food: 2007 – 2008
What inflation really is, is a taxation on monetary assets. And guess who is paying for all of that?

I just love this video. A must see:
The Stock Market and the Monetary System are on the verge of collapse!

Read moreUS: Total Crash of the Entire Financial System Expected, Say Experts

Ron Paul: This coming crisis is bigger than the world has ever experienced

The following statement is written by Congressman Paul about the pending financial disaster.

He will introduce this statement as a special order and insert it into the Congressional Record next week. Fortunately, we have the opportunity to debut it first on the Campaign for Liberty blog. It reads as follows:

I have, for the past 35 years, expressed my grave concern for the future of America. The course we have taken over the past century has threatened our liberties, security and prosperity. In spite of these long-held concerns, I have days-growing more frequent all the time-when I’m convinced the time is now upon us that some Big Events are about to occur. These fast-approaching events will not go unnoticed. They will affect all of us. They will not be limited to just some areas of our country. The world economy and political system will share in the chaos about to be unleashed.

Though the world has long suffered from the senselessness of wars that should have been avoided, my greatest fear is that the course on which we find ourselves will bring even greater conflict and economic suffering to the innocent people of the world-unless we quickly change our ways.

America, with her traditions of free markets and property rights, led the way toward great wealth and progress throughout the world as well as at home. Since we have lost our confidence in the principles of liberty, self reliance, hard work and frugality, and instead took on empire building, financed through inflation and debt, all this has changed. This is indeed frightening and an historic event.

The problem we face is not new in history. Authoritarianism has been around a long time. For centuries, inflation and debt have been used by tyrants to hold power, promote aggression, and provide “bread and circuses” for the people. The notion that a country can afford “guns and butter” with no significant penalty existed even before the 1960s when it became a popular slogan. It was then, though, we were told the Vietnam War and a massive expansion of the welfare state were not problems. The seventies proved that assumption wrong.

Related articles and videos:
Dow suffers worst 1st half since ‘70
Fortis Bank Predicts US Financial Market Meltdown Within Weeks
Barclays warns of a financial storm as Federal Reserve’s credibility crumbles
Jim Rogers: Avoid The Dollar At All Costs
Ron Paul on Iran and Energy June 26, 2008
Marc Faber: ‘Misleading’ Fed Should Let Banks Fail

Read moreRon Paul: This coming crisis is bigger than the world has ever experienced

Barclays warns of a financial storm as Federal Reserve’s credibility crumbles

Related article: Fortis Bank Predicts US Financial Market Meltdown Within Weeks


Strategists at Barclays accuse Ben Bernanke of a policy blunder

Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall “below zero.”

“We’re in a nasty environment,” said Tim Bond, the bank’s chief equity strategist. “There is an inflation shock under way. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth.”

Barclays Capital said in its closely-watched Global Outlook that US headline inflation would hit 5.5pc by August and the Fed will have to raise interest rates six times by the end of next year to prevent a wage-spiral. If it hesitates, the bond markets will take matters into their own hands. “This is the first test for central banks in 30 years and they have fluffed it. They have zero credibility, and the Fed is negative if that’s possible. It has lost all credibility,” said Mr Bond.

The grim verdict on Ben Bernanke’s Fed was underscored by the markets yesterday as the dollar fell against the euro following the bank’s dovish policy statement on Wednesday. Traders said the Fed seemed to be rowing back from rate rises. The effect was to propel oil to $138 a barrel, confirming its role as a sort of “anti-dollar” and as a market reproach to Washington’s easy-money policies.

The Fed’s stimulus is being transmitted to the 45-odd countries linked to the dollar around world. The result is surging commodity prices. Global inflation has jumped from 3.2 to 5pc over the last year. Mr Bond said the emerging world is now on the cusp of a serious crisis. “Inflation is out of control in Asia. Vietnam has already blown up. The policy response is to shoot the messenger, like the developed central banks in the late 1960s and 1970s,” he said.

“They will have to slam on the brakes. There is going to be a deep global recession over the next three years as policy-makers try to get inflation back in the box.”

Read moreBarclays warns of a financial storm as Federal Reserve’s credibility crumbles

Fortis Bank Predicts US Financial Market Meltdown Within Weeks

BRUSSELS / AMSTERDAM (DFT) – Fortis expects within the next few days to weeks to complete the collapse of the U.S. financial markets.

That explains the bank insurers interventions of the series Thursday at dealing with € 8 billion.

“We are ready at the last minute. It goes in the United States much worse than thought, “said Fortis chairman Maurice Lippens, who maintains that CEO Votron to live. Fortis expects bankruptcies of 6000 U.S. banks that now lack coverage. “But Citigroup, General Motors, there begins a complete meltdown in the U.S..”

Fortis took yesterday € 1.5 billion with a share issue. At the end of last year was the Belgian-Dutch group € 13 billion of new shares for the takeover of ABN Amro, for which it paid € 24 billion. Lippens bases its concern on interviews with bankers. “Two months ago we knew not so bad that it is in America. And it will be much worse. We have a thick mattress needed for the next eighteen months to come when we can bring to ABN Amro. ”

Two weeks ago reported the U.S. investment bank and adviser to Fortis Merrill Lynch certainly € 6.2 billion in additional capital was needed. The VEB yesterday demanded clarification of Fortis: CEO Jean-Paul Votron stopped in late april Fortis maintains that after the purchase of ABN Amro does not need on the capital market. In one year € 30 billion in market capitalization destroyed. After Votron last confession kelderde the share price by 19.4%, although yesterday climbed by 4.4% to € 10.65.

The massive unrest around the bank insurers, especially with our neighbours in Belgium as a bomb broken. While the fuss arose in the Netherlands to the limited financial world, it is with our neighbours the call of the day. Not only is the bank dominates the streetscape, but by the mokerslag for the Belgian volksaandeel are also hundreds of thousands of small investors hit hard.

All Belgian newspapers opened yesterday with real rampenkoppen, where the free fall of the bank insurers was wide coverage. ‘Fortis crashes, “” Rampdag for Fortis’ and’ Fortis loses 5.3 billion, “opened three leading newspapers.

Read moreFortis Bank Predicts US Financial Market Meltdown Within Weeks

This Recession, It’s Just Beginning


Vincent Quinones works on the floor of the New York Stock Exchange Wednesday after the Federal Reserve issued a mixed assessment of the economy. Yesterday, the Dow Jones industrial average closed down 358 points. (By Andrew Harrer — Bloomberg News)

So much for that second-half rebound.

Truth be told, that was always more of a wish than a serious forecast, happy talk from the Fed and Wall Street desperate to get things back to normal.

It ain’t gonna happen. Not this summer. Not this fall. Not even next winter.

This thing’s going down, fast and hard. Corporate bankruptcies, bond defaults, bank failures, hedge fund meltdowns and 6 percent unemployment. We’re caught in one of those vicious, downward spirals that, once it gets going, is very hard to pull out of.

Only this will be a different kind of recession — a recession with an overlay of inflation. That combo puts the Federal Reserve in a Catch-22 — whatever it does to solve one problem only makes the other worse. Emerging from a two-day meeting this week, Fed officials signaled that further recession-fighting rate cuts are unlikely and that their next move will be to raise rates to contain inflationary expectations.

Since last June, we’ve seen a fairly consistent pattern to the economic mood swings. Every three months or so, there’s a round of bad news about housing, followed by warnings of more bank write-offs and then a string of disappointing corporate earnings reports. Eventually, things stabilize and there are hints that the worst may be behind us. Stocks regain some of their lost ground, bonds fall and then — bam — the whole cycle starts again.

It was only in November that the Dow had recovered from the panicked summer sell-off and hit a record, just above 14,000. By March, it had fallen below 12,000. By May, it climbed above 13,000. Now it’s heading for a new floor at 11,000. Officially, that’s bear market territory. We’ll be lucky if that’s the floor.

In explaining why that second-half rebound never occurred, the Fed and the Treasury and the Wall Street machers will say that nobody could have foreseen $140 a barrel oil. As excuses go, blaming it on an oil shock is a hardy perennial. That’s what Jimmy Carter and Fed Chairman Arthur Burns did in the late ’70s, and what George H.W. Bush and Alan Greenspan did in the early ’90s. Don’t believe it.

Truth is, there are always price or supply shocks of one sort or another. The real problem is that the underlying fundamentals had gotten badly out of whack, making the economy susceptible to a shock. The only way to make things better is to get those fundamentals back in balance. In this case, that means bringing what we consume in line with what we produce, letting the dollar fall to its natural level, wringing the excess capacity out of industries that overexpanded during the credit bubble and allowing real estate prices to fall in line with incomes.

The last hope for a second-half rebound began to fade earlier this month when Lehman Brothers reported that it wasn’t as immune to the credit-market downturn as it had led everyone to believe. Lehman scrambled to restore confidence by firing two top executives and raising billions in additional capital, but even that wasn’t enough to quiet speculation that it could be the next Bear Stearns.

Since then, there has been a steady drumbeat of worrisome news from nearly every sector of the economy.

American Express and Discover warn that customers are falling further behind on their debts. UPS and Federal Express report a noticeable slowdown in shipments, while fuel costs are soaring. According to the Case-Shiller index, home prices in the top 20 markets fell 15 percent in April from the year before, and Fannie Mae and Freddie Mac report that mortgage delinquency rates doubled over the same period — and that’s for conventional home loans, not subprime. United Airlines accelerates the race to cut costs and capacity by laying off 950 pilots — 15 percent of its total — as a number of airlines retire planes and hint that they may delay delivery or cancel orders of new jets from Boeing and Airbus. Goldman Sachs, which has already had to withdraw its rosy forecast for stocks, now admits it was also too optimistic about junk bond defaults, and analysts warn that Citigroup and Merrill Lynch will also be forced to take additional big write-downs on their mortgage portfolios.

Read moreThis Recession, It’s Just Beginning

U.S. Stocks Tumble, Sending Dow to Worst June Since Depression

June 26 (Bloomberg) — U.S. stocks tumbled, sending the Dow Jones Industrial Average to its worst June since the Great Depression, as record oil prices, credit-market writedowns and a slowing economy threatened to extend a yearlong profit slump.

General Motors Corp., the largest U.S. automaker, plunged the most in three years as Goldman Sachs Group Inc. advised selling the stock and crude rose by $5 a barrel. Citigroup Inc. led the KBW Bank Index to an almost 10-year low as Goldman said the lender may report an $8.9 billion second-quarter charge and cut its dividend. Research In Motion Ltd., maker of the BlackBerry, posted its biggest drop since 2001 on concern competition with Apple Inc.‘s iPhone is reducing earnings.

The Standard & Poor’s 500 Index plunged 38.82, or 2.9 percent, to 1,283.15, its biggest drop in three weeks. The Dow decreased 358.41, or 3 percent, to 11,453.42, its lowest since September 2006. The Nasdaq Composite Index sank 79.89, or 3.3 percent, to 2,321.37, its worst loss since January. Almost nine stocks fell for each that rose on the New York Stock Exchange.

Read moreU.S. Stocks Tumble, Sending Dow to Worst June Since Depression