Finally, the Republicans reveal their 11-point Economic Stimulus plan, as revealed by David Michael Green:

1. TALK A LOT ABOUT FISCAL RESPONSIBILITY. We all know that marketing perceptions are more important than actual realities, and nowhere more so than in this domain. Forget about what anyone actually does. Just remember that the Democrats are always "tax-and-spend liberals", and the GOP is the "party of fiscal responsibility". Say it over and over. Pretty soon you'll believe it, and others will too. 2. DEIFY RONALD REAGAN, IN ALL WAYS, ALL THE TIME. Never miss a chance to remind people of the wonderful powers and accomplishments of Reagan, from ending the Cold War to curing polio and walking on water. If anyone thinks those are some dubious claims, or mentions the one or two boo-boos of the Reagan years, give them that special Moonie stare of the true believer and walk away to where your consciousness remains safely protected from challenging thoughts. 3. PRACTICE VOODOO ECONOMICS. If you run for president, do what Reagan did. Promise that you'll slash taxes, spend way more on the military, and balance the budget, all at the same time. If you get elected, do what Reagan did again. Triple the national debt. Because your campaign promises are physically impossible. 4. PRACTICE VOODOO ECONOMICS AGAIN. (S)elect George W. Bush as president, and repeat Reagan's amazing accomplishment, this time on steroids. Take the largest surplus in American history and turn it into the largest deficit. Take the federal government's debt, accrued over more than two centuries, and double it from $5 trillion to $11 trillion in just eight years. Spend the money on vital necessities like massive tax cuts for the already fantastically wealthy, and incredibly expensive wars against non-enemies. 5. TALK EVEN MORE ABOUT FISCAL RESPONSIBILITY. Wait until a Democratic president comes to office, inheriting the worst American economy since 1932. All of a sudden, relocate your outrage - previously gone on walkabout - at the horrors of deficit spending. Only days after the Bush administration has ended, start talking incessantly about fiscal responsibility, just as if the last eight years had never happened. 6. HAVE ABSOLUTELY NO PLAN FOR ECONOMIC RECOVERY. Whatsoever. Pledge to do precisely what Hoover did in 1932: Absolutely nothing! Let people crash and burn when they lose their jobs and healthcare and homes. Take away the few shreds of a social safety net they have. Don't even spend stimulus funds for unemployment insurance in your state. Avoid the perils of moral hazard by letting (ordinary) people starve. 7. MAKE A LOT OF NOISE ABOUT EARMARKS. Who cares if they're less than one percent of the budget?? They have lots of marketing value and can help disable the Democratic government while diverting attention from all the great fiscal and economic achievements of the past eight years. 8. REINVENT HISTORY. Franklin Roosevelt didn't solve the problem of the Great Depression, but his New Deal program of massive government spending did in fact achieve two key things. First, it nearly halved unemployment, cutting it from 25 percent to 15 percent. And, second, it literally kept millions of Americans alive who would have otherwise perished when no other safety net remained. All of this is a serious problem in 2009, given the desire of the public for the government to resolve the current problem. Solution? Lie like hell. Tell people that the New Deal had no impact and was a complete waste of money. 9. REINVENT ECONOMICS. Talk about the stimulus package as though it were an ordinary spending bill, loaded with pork barrel waste. Never make the connection between spending, purely for its stimulative effect, and economic recovery. Argue that it was World War II that ended the Depression, not the New Deal, remaining completely oblivious to the fact that both are nothing short of massive government spending, exactly what the Democrats are doing with their stimulus legislation today. 10. BLOCK ACTION TO REVIVE THE ECONOMY. Even though you haven't got one of your own, carp incessantly about everything that is wrong - real or imagined - with the Democrats' recovery plans. Even though the public has repudiated you in two successive elections and you are the minority in both the House and the Senate, use every tool possible to block action of any sort by the government elected by the people to solve the crisis. 11. COMMIT POLITICAL SUICIDE. Yep, that's the ticket. Create an incredible crisis. Deny everything. Reinvent history. Block all solutions except those that would repeat the same disasters of the past. Ask the people to vote for you.

At least it's a whole lot easier to accomplish than the Democrats' plan..

How the U.S. Treasury Department makes decisions:

FRIDAY F U N

• President Obama's teleprompter has its own blog. Oh, and it's hilarious.
• When graffiti comes alive
• Huge repository of viewable Grateful Dead concerts
• The world's worst international airport
• Tornado videos
• View the works of hundreds of famous artists at Art Browser
• Play The Bailout Game
• Secret passages in homes

Bits

In the U.S., there's a much different justice system for the wealthy ruling class.

Remember, until these . kinds of . indicators start showing improvement, the economy won't be getting any better, in spite of what the media pundits might say.

Today's economic woes, caused by the Bush Administration, is ironically causing an increase in abortions.

Outsourcing police: Unfortunately, Chicago is giving it a try.

USC tries speed-dating techniques in order to foster interdisciplinary collaboration among faculty.

The true unemployment rates are much worse than those reported by MSM.

Matt Taibbi explains the Wall Street Revolution (excerpt):

....As complex as all the finances are, the politics aren't hard to follow. By creating an urgent crisis that can only be solved by those fluent in a language too complex for ordinary people to understand, the Wall Street crowd has turned the vast majority of Americans into non-participants in their own political future. There is a reason it used to be a crime in the Confederate states to teach a slave to read: Literacy is power. In the age of the CDS and CDO, most of us are financial illiterates. By making an already too-complex economy even more complex, Wall Street has used the crisis to effect a historic, revolutionary change in our political system — transforming a democracy into a two-tiered state, one with plugged-in financial bureaucrats above and clueless customers below. The most galling thing about this financial crisis is that so many Wall Street types think they actually deserve not only their huge bonuses and lavish lifestyles but the awesome political power their own mistakes have left them in possession of. When challenged, they talk about how hard they work, the 90-hour weeks, the stress, the failed marriages, the hemorrhoids and gallstones they all get before they hit 40. "But wait a minute," you say to them. "No one ever asked you to stay up all night eight days a week trying to get filthy rich shorting what's left of the American auto industry or selling $600 billion in toxic, irredeemable mortgages to ex-strippers on work release and Taco Bell clerks. Actually, come to think of it, why are we even giving taxpayer money to you people? Why are we not throwing your ass in jail instead?"....

"....Well, it appears that President Obama has joined the rest of the world in practicing the diplomacy of talk. The worst thing that could happen would be for the Iranian government to respond favorably and positively, want to engage, have a discussion. And then we would be on a track like that, which will lead nowhere in the end. It’s not as if there’s not enough evidence to figure out what kind of government this is and what its intentions are, that’s been abundantly clear for many, many years. And an endless round of talk, first there would be talks about talks, and then there’d be talks, and they’d be talking and that means well, the Iranian regime would continue to do what it’s been doing but everybody in the world would sit by nodding affirmatively that this is the right approach, that’ll go nowhere...." Brit Hume, Fox "News"

If you look to the right-wing media for any form of intelligent, thoughtful discussion, you'll be more successful spending that time searching for a Republican living in reality (hint: there are none).

BITS

Teenagers armed with only an $80 camera and a latex balloon have managed to take stunning pictures of space from 20-miles above Earth.

If you have heard about, but not seen, Obama's video directed towards Iran, see it here.

Wednesday night Juan Cole was a guest on Colbert Report. Read his interesting description of his experiences here.

Read what literate/intelligent people are saying about the AIG bonus fiasco.

Who's the Villain in the [Economic] Crisis?

Obama Adminstration prepares for a third war: the military-industrial complex

Juan Cole updates the status of U.S. operations in Iraq and the rest of the Muslim world

The Pope apparently is unaware that the quality of condoms has improved over the last two centuries.

Credit card companies are choking small businesses with higher rates and lower limits.

Labor Unions, Others react to AIG's swindle of American taxpayers.

(Note: 7 of 6 is on hiatus. We look forward to the resumption of his excellent posting.)

If 100,000,000 Americans spend an average of 30 seconds a day logging into a computer or web site, we as a nation spend the equivalent of 1.6 years of time doing this each day!

Just some random thoughts for today:

• 1. Do not walk behind me, for I may not lead. Do not walk ahead of me, for I may not follow. Do not walk beside me either. Just pretty much leave me the hell alone.
• 2. The journey of a thousand miles begins with a broken fan belt and leaky tire.
• 3. It's always darkest before dawn. So if you're going to steal your neighbor's newspaper, that's the time to do it.
• 4. Don't be irreplaceable. If you can't be replaced, you can't be promoted.
• 5. Always remember that you're unique. Just like everyone else.
• 6. Never test the depth of the water with both feet.
• 7. If you think nobody cares if you're alive, try missing a couple of car payments.
• 8. Before you criticize someone, you should walk a mile in their shoes. That way, when you criticize them, you're a mile away and you have their shoes.
• 9. If at first you don't succeed, skydiving is not for you.
• 10. Give a man a fish and he will eat for a day. Teach him how to fish, and he will sit in a boat and drink beer all day.
• 11. If you lend someone $20 and never see that person again, it was probably worth it.
• 12. If you tell the truth, you don't have to remember anything.
• 13. Some days you're the bug; some days you're the windshield.
• 14. Everyone seems normal until you get to know them.
• 15. The quickest way to double your money is to fold it in half and put it back in your pocket.
• 16. A closed mouth gathers no foot.
• 17. Duct tape is like 'The Force'. It has a light side and a dark side, and it holds the universe together.
• 18. There are two theories to arguing with women. Neither one works.
• 19. Generally speaking, you aren't learning much when your lips are moving.
• 20. Experience is something you don't get until just after you need it.
• 21. Never miss a good chance to shut up.
• 22. Never, under any circumstances, take a sleeping pill and a laxative on the same night

Let the Republican hypocracy continue:

FRIDAY F U N

• Detecting a Liar
• Let ClerkDogs recommend a movie for you, using a very sophisticated database
• Morphing Presidents
• Funny photos from odd angles
• When life sucks
• ScanAmerica lets you listen to live police scanners
• Humorous Error 404
• THIS should make police high speed chases much more exciting...
• Five-second films
• Monsters

A Primer on Robber Barons

As the hyperventilating political establishment goes bonkers over AIG's (shouldn't-be-surprising) rip-off of the U.S. public, it's good to review previous rip-off artists (courtesy of Knowledge News) and contrast them to today's apparently completely immoral and unethical leaders of private finance:

Meet the Robber Barons : John D. Rockefeller,Andrew Carnegie, Cornelius Vanderbilt, and J.P. Morgan Friends, when the federal government has to bail out bankers, and then the bankers use the bailout on a bonus, people inevitably draw lines to history's "robber barons." But that's probably unfair--to the robber barons. Yes, some Gilded Age captains of industry defrauded investors as they gathered capital. And yes, they ruthlessly pocketed almost obscene amounts of cash. But they also built the entire industrial infrastructure of the post-Civil War United States. Just look at the wealthiest and most powerful of the bunch: John D. Rockefeller, Andrew Carnegie, Cornelius Vanderbilt, and J.P. Morgan. By some measures, the first three remain the wealthiest Americans ever to live, amassing fortunes that, in today's dollars, would far surpass those of Bill Gates and Warren Buffett. Morgan never reached those heights, but he wielded Wall Street's purse. John D. Rockefeller--Liquid Assets John D. Rockefeller (1839-1937) preferred liquid assets--namely, oil. When prospectors tapped western Pennsylvania in the late 1850s, Rockefeller quickly put two and two together and realized that the real money was in refining. Then, he proceeded to put everything together, first buying up refineries, then buying up everything else involved in moving oil from rock to house. By 1880, Rockefeller's Standard Oil Company controlled more than 90 percent of the nation's refining capacity. Ruthlessly efficient, "the Standard" could undercut any competitor's best price. Government trustbusters finally carved up the company in 1911, and Rockefeller became a full-time philanthropist, giving away more than $500 million. Andrew Carnegie--Cold, Hard Cash Andrew Carnegie (1835-1919) made cold, hard cash from steel. The son of a Scottish peasant, Carnegie was superintendent of a railroad by age 24. There, he realized that bigger rail cars would require new infrastructure--wooden bridges would have to be iron, and iron rails would have to be steel. By 1875, Carnegie owned a bridge works and a steel mill. By 1889, he had an absolutely iron grip on the American steel market.Carnegie planned, and pinched, every production cost, making his mills more efficient than practically any other factory of the era. He retired in 1901, when J.P. Morgan bought him out to make the largest corporation in the world: U.S. Steel. Carnegie's beliefs demanded philanthropy--"the man who dies rich," he wrote, "dies disgraced"--so he spent his retirement investing $350 million in cultural and educational institutions, including 2,800 libraries. Cornelius Vanderbilt--Railroading Cornelius Vanderbilt (1794-1877) ran railroads, and had a knack for railroading anyone who dared compete. Once, when two associates tried to wrest control of one of his companies, he vowed, "You have undertaken to cheat me. I won't sue you, for the law is too slow. I'll ruin you."Vanderbilt got his start in steamboats, first schlepping New Yorkers up the Hudson River, then rushing gold seekers from New York to San Francisco via Nicaragua. In both cases, Vanderbilt cut fares so low that his competitors literally paid him to go away. (He was probably the first to understand "bleacher" economics: that is, cheap seats but $5 hot dogs.) He got into railroads at the time of the Civil War, buying up so much railroad stock that he owned 17 local lines, which he fused into the New York Central system running between New York and Chicago. Vanderbilt hadn't much use for philanthropy. He gave $1 million to the university that bears his name, but otherwise willed his fortune to his son. J.P. Morgan--Backstage Baron J.P. Morgan (1837-1913), financier extraordinaire, wielded robber-baron power at a fraction of the wealth (if you can call more than $100 million in Gilded Age dollars a fraction). In his era, Morgan was Wall Street. Insiders called him "Jupiter," chief of the financial gods. If Morgan said you could have money, you had money. If he put the market's purse away, you were halfway to running a fruit stand. Though baronial by birth and nature, Morgan understood how to protect the golden goose. During economic crises in 1895 and 1907, Morgan rallied Wall Street and--in the absence of a central bank--personally guaranteed the financial liquidity of the United States. Ruthless and Corrupt? Certainly. Only way to get things done, said the barons. As one political lubricator put it, "If a [politician] has the power to do great evil and won't do right unless he is bribed to do it, I think .... it is a man's duty to go up and bribe..." Railroad magnate E.H. Harriman once responded to a reporter's challenge by pulling a page from his pocket and detailing all the track he had laid and rates he had cut. The reporter pressed, "But the public assails and attacks you and impugns your motives and accuses you of all sorts of things. Doesn't the thanklessness of the job ever embitter you?" Slapping his sheet of statistics, Harriman barked, "That remains." Can today's bailed-out bankers say the same? ---Michael Himick

Jet Blue has a surprising sense of humor:

Just How Stupid ARE Republicans?

"....Thank you, thank you. We are cooling. We are not warming. The warming you see out there, the supposed warming, and I am using my finger quotation marks here, is part of the cooling process. Greenland, which is now covered in ice, it was once called Greenland for a reason, right? Iceland, which is now green. Oh I love this. Like we know what this planet is all about. How long have we been here? How long? No very long...." - - - Michael Steele, Head, Republican National Committee

For godsakes, this is the HEAD of the Republican Party? Click the name and catch the many other gaffes Mr. Steele made during the radio show. It's fodder for amusement!

Open Letter to the Republican Traitors (From a Former Republican) by Frank Schaeffer You Republicans are the arsonists who burned down our national home. You combined the failed ideologies of the Religious Right, so-called free market deregulation and the Neoconservative love of war to light a fire that has consumed America. Now you have the nerve to criticize the "architect" America just hired -- President Obama -- to rebuild from the ashes. You do nothing constructive, just try to hinder the one person willing and able to fix the mess you created. I used to be one of you. As recently as 2000 I worked to get Senator McCain elected in that year's primary. (McCain and Gen. Tommy Franks wrote glowing endorsements regarding my book about military service, AWOL.). I have a file of handwritten thank you notes from Presidents Ford, Reagan, Bush I and II. In the 1970s and early 80s I hung out with Jack Kemp and bought into his "supply side" myth and even wrote a book he endorsed pushing his ideas.) There's more, but take it from me; my parents (evangelical leaders Francis and Edith Schaeffer) and I were about as tight with -- and useful to -- the Republican Party as anyone. We played a big part creating the Religious Right. In the mid 1980s I left the Religious Right, after I realized just how very anti-American they are, (the theme I explore in my book Crazy For God). They wanted America to fail in order to prove they were right about America's "moral decline." Soon after McCain lost in 2000 I re-registered as an independent in disgust with W. Bush. But I still respected many Republicans. Not today. How can anyone who loves our country support the Republicans now? Barry Goldwater, William F. Buckley and Ronald Reagan defined the modern conservatism that used to be what the Republican Party I belonged to was about. Today no actual conservative can be a Republican. Reagan would despise today's wholly negative Republican Party. And can you picture the gentlemanly and always polite Ronald Reagan, endorsing a radio hate-jock slob who crudely mocked a man with Parkinson's and who now says he wants an American president to fail?! With people like Limbaugh as the loudmouth image of the Republican Party -- you need no enemies. But something far more serious has happened than an image problem: the Republican Party has become the party of obstruction at just the time when all Americans should be pulling together for the good of our country. Instead, Republicans are today's fifth column sabotaging American renewal. President Obama has been in office barely 45 days and the Republican Party has the nerve to blame him for the economic and military cataclysm he inherited. I say economic and military cataclysm because without the needless war in Iraq you all backed we would not be in the economic mess we're in today. If that money had been spent here at home on renovating our infrastructure, taking us toward a green economy, putting our health-care system in order we'd be a very different situation. As the father of a Marine who served in George W. Bush's misbegotten wars let me say this: if President Obama's strategy to repair our economy, infrastructure and healthcare fails that will put our troops at far greater risk because the world will become a far more dangerous place. So for all you flag-waving Republicans who are trying to undermine the President at home -- if you succeed more of our troops will be killed abroad. When your new leader Rush Limbaugh calls for President Obama to fail he's calling for more flag-draped coffins. Limbaugh is the new "Hanoi Jane." For the party that created our crises of misbegotten war, mismanaged economy, the lack of regulation of our banking industry, handing our country to rich crooks... to obstruct the one person who is trying to repair the damage is obscene. Just imagine where America would be today if the 14 to 20 million voters -- "the rube base" who slavishly follow the likes of Limbaugh -- had not voted as a block year after year thus empowering the Republican fiasco. We would have a regulated banking industry and would have avoided our current financial crisis; some 4000 of our killed military men and women would be alive; over to 35,000 wounded Americans would be whole; we would have been leaders in the environmental movement; we would be in the middle of a green technology boom fueling a huge expansion of our economy and stopping our dependence on foreign oil, and our health-care system would be reformed. After Obama was elected, you Republican leaders had a unique last chance to send a patriotic message of unity to the world -- and to all Americans. You could have backed our president's economic recovery plan. Since we all know that half of our problem is one of lost confidence and perception, nothing would have done more to calm the markets and project resolve and confidence than if you had been big enough to take Obama's offered hand and had work with him -- even if you disagreed ideologically. You had the chance to put our country first. You utterly failed to rise to the occasion. The worsening economic situation is your fault and your fault alone. The Republicans created this mess through 8 years of backing the worst president in our history and now, because you put partisan ideology ahead of the good of our country, you have blown your last chance to redeem yourselves. You deserve the banishment to the political wilderness that awaits all traitors.

Getting serious about financial snake oil salesmen:

Extended cut #1:

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 1

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Extended cut #2:

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 2

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Extended cut #3:

The Daily Show With Jon StewartM - Th 11p / 10c

Jim Cramer Unedited Interview Pt. 3

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Here is an analysis of this interview and its implications for journalists in general.

Bits

Track how the Stimulus Money is getting distributed and spent

A photo gallery of the men who brought down the world economy

Breeding ourselves into extinction

In the USA, atheists are now outnumbered only by Catholics and Baptists.

Financially sound banks are angry over FDIC's increase in fees to help take over failed banks.

Germany, the democracy that the U.S. helped found, has eliminated all electronic voting. No such luck in the U.S. in the foreseeable future.

The Democratic Party enters the competitive field of comedy, and picks a heckuva good subject for starters.

FRIDAY F U N

• I was okay with the awesomeness of this toilet until they started flushing all those gummy bears and hot dogs.
• Happy 30th Birthday, CD
• If you just hate getting up to turn things on and off, then this gadget is for you.
• A computer hacker's dream
• A quiltmaker's fantasy web site
• Funny signs from around the world
• Arms
• Dropzone game
• Some movie sequels might never die
• Passenger in an airplane crash twitters his experience

Billions Dished Out in the Shadows By Robert Scheer This is crazy! Forget the bleating of Rush Limbaugh; the problem is not with the quite reasonable and, if anything, underfunded stimulus package, which in any case will be debated long and hard in Congress. The problem is with what is not being debated: the far more expensive Wall Street bailout that is being pushed through—as in the case of the latest AIG rescue—in secret, hurried deal-making primarily by the unelected secretary of the treasury and the chairman of the Federal Reserve. Six months ago, we taxpayers began bailing out AIG with more than $140 billion, and then it went and lost $61.7 billion in the fourth quarter, more than any other company in history had ever lost in one quarter. So Timothy Geithner and Ben Bernanke huddled late into the night last weekend and decided to reward AIG for its startling failure with 30 billion more of our dollars. Plus, they sweetened the deal by letting AIG off the hook for interest it had been obligated to pay on the money we previously gave the company. AIG doesn’t have to pay the 10 percent interest due on the preferred stock the U.S. government got for the earlier bailout funds because that interest will now be paid out only at AIG’s discretion, which means never. The preferred stock, which got watered down, carried a cumulative interest, meaning we taxpayers would have recaptured some money if the company ever got going again, but that interest obligation was waived in the new deal. We’ve already given AIG a total of $170 billion—an amount that dwarfs the $75 billion allocated to helping those millions of homeowners facing foreclosures. And more will be thrown down the AIG rat hole because President Barack Obama is blindly following the misguided advice of his top economic advisers, who insist that AIG is too big to fail. “AIG provides insurance protection to more than 100,000 entities, including small businesses, municipalities, 401(k) plans and Fortune 500 companies who together employ over 100 million Americans,” the joint Treasury Department and Fed statement declared while insisting that for that reason, plus the “systemic risk AIG continues to pose and the fragility of markets today, the potential cost to the economy and the taxpayer of government inaction would be extremely high.” What about the cost of inaction by Treasury and the Fed before this meltdown? If AIG were so important to the American economy, shouldn’t government regulators have been looking more closely at its activities? They couldn’t then, and even now they don’t understand what AIG has been up to, because the company was allowed to operate in an essentially unregulated global economy in which multinational corporations have their way. As the Treasury/Fed statement concedes: “AIG operates in over 130 countries with over 400 regulators and the company and its regulated and unregulated subsidiaries are subject to very different resolution frameworks across their broad and diverse operations without an overarching resolution mechanism.” Oh, really? And you’re discovering that only now, when you’re making us bail AIG out? It wasn’t that long ago that a couple of hustlers operating out of an AIG office in London were going wild making money off selling insurance on credit default swaps that no one could understand, but the company execs loved those huge profit margins. To challenge their maneuvering, as some in Congress attempted, was said by their defenders, including Geithner, to put them at an unfair disadvantage in the world market. Ignorance was bliss … until the bubble burst. This was all belatedly conceded by Bernanke in his Senate testimony on Tuesday: “AIG exploited a huge gap in the regulatory system. There was no oversight of the Financial Products division. This was a hedge fund, basically, that was attached to a large and stable insurance company, made huge numbers of irresponsible bets—took huge losses. There was no regulatory oversight because there was a gap in the system.” AIG used to be in the conventional insurance business, covering identifiable risks it knew something about, until it took advantage of deregulation and a lack of government surveillance to come up with contrived new financial products. Even Maurice Greenberg, the man who built AIG from the ground up over a span of 40 years before he was forced out amid corruption charges in 2005, admits that he didn’t understand the newfangled financial gimmicks that the company was peddling. This week, claiming he too was swindled, Greenberg sued in federal court, charging the AIG execs who forced him out with “gross, wanton or willful fraud or other morally culpable conduct,” over the credit default swap portfolio that was part of his settlement. U.S. taxpayers now have ownership of almost 80 percent of AIG, but with the company’s once solid traditional insurance business now suffering a steep loss of consumer confidence, it’s not likely that even the formerly healthy parts of the company will be worth much. What we have here is all pain and no gain for the taxpayers roped into this debacle, which is proving to be the story of the entire banking bailout.

I'm not sure why Mr. Scheer seems so surprised. Big business and the federal government are joined at the hip. Until we legislatively sever the political and financial ties between the two entities, our money will continue to get tossed into the black hole known as AIGCITYGROUPBANKOFAMERICAWELLSFARGOETC.

How the FDIC takes over failed banks:


Watch CBS Videos Online

Men Bear the Brunt

From Heather Boushey:

"Lay-offs were again widespread in February. Half of the job losses—50.3 percent—since the recession began in December 2007 have occurred in construction and manufacturing: 904,000 construction jobs and 1.3 million manufacturing jobs have disappeared over the course of this recession. As of January, men accounted for 78.5 percent of the jobs lost in these two industries, and 78.0 percent of the jobs lost overall. As a result, the share of adult men with a job is at an all-time low 68.9 percent."

Men: Don't just take this bad news lying down. Get up, have a couple of beers and THEN lay down.

A Credit Market Primer

From Knowledge News:

Tight Credit "The act of borrowing short-term and lending long-term makes financial institutions less liquid and therefore inherently vulnerable to crisis. It is a sustainable situation, however, so long as there is widespread confidence, particularly among lending institutions themselves, in the quality of the assets being created." "The current turmoil in U.S. financial markets is the result of a breakdown in that necessary confidence. In an environment of distrust, financial institutions are less willing to lend long-term. While still willing to borrow short-term, in the face of great uncertainty they will tend to also lend short-term in an attempt to enhance their own liquidity." "They prefer to hold riskless Treasury securities that offer almost no return rather than lend to a business or consumer who presents even moderate risk." Tight Credit Crunches Residential Investment "So far, the effect of progressively tighter credit conditions in 2007 and 2008 has been most evident on real residential spending, which is highly sensitive to changes in the price and quantity of mortgage lending." "The inventory of unsold homes was reported to be around 4.5 million units, or equivalent to about an eleven month supply. Similarly, housing starts have fallen precipitously, from over 2 million units in 2006 to an annual rate of about 800,000 units through September 2008, or a total decline in housing starts of about 60%." "A significant factor in the sizable decrease of residential investment has likely been a sharp slowing of the flow of mortgage credit from lenders. As recently as the fourth quarter of 2007, mortgage lending to households occurred at an annual rate of $635 billion, but that flow had diminished to $81 billion by July 2008." Tight Credit Crunches Business Investment "Real non-residential investment spending continued to increase in 2007 and the first half of 2008 despite the growing turmoil in U.S. financial markets." "Since then, the rate of increase has been slowing. After advancing 7.5% in 2006, the pace of spending by businesses on new plant and equipment slowed to 5.0% in 2007, and through the second quarter of 2008 that pace had slowed to about 2.3%. In the third quarter of 2008, real non-residential investment declined 0.1%." "The fall of real non-residential investment in the third quarter of 2008, although small, suggests to some that for many businesses a point has been reached where a dwindling flow of credit is a significant constraint on non-residential investment spending. For most corporations, the primary credit constraint is not likely to be a lack of bank credit but the inability to issue bonds on affordable terms." Tight Credit Crunches Consumer Spending "Until recently, the flow of credit to households (other than mortgage lending) was not greatly diminished. As recently as the fourth quarter of 2007, bank loans to households increased at an annual rate of nearly $63 billion." "Yet by the second quarter of 2008, bank loans to households decreased at a $52 billion annual rate. This diminished flow of bank credit could constrain many types of consumer purchases, such as autos, major appliances, and higher education. . . . These are expenditures that are typically financed by borrowing." "In contrast, the flow of consumer credit (largely credit cards) has remained relatively strong through the second quarter of 2008, down from an annual pace of $136 billion in 2007 but still increasing at a $114 billion annual rate in the second quarter of 2008. This pattern of borrowing probably indicates that households have been running up their credit card balances to sustain their spending." The Fed's Fight to Loosen Credit "As the 'lender of last resort,' the Federal Reserve offers credit to solvent but temporarily illiquid financial institutions. These financial institutions are solvent because the value of their assets exceeds the value of their liabilities. But because their debts tend to be short-term and liquid while their assets are long-term and illiquid, they are in need of short-term funds to meet short-term debt obligations." "The Fed's discount window is its facility for making loans to financial institutions with short-term liquidity problems, and the discount rate is the interest rate charged for these loans. . . . The Fed's enhanced discount window initiatives have pumped a large volume of liquidity into the U.S. financial system." "For the two-month period ending October 1, 2008, the Fed increased systemwide reserve funds by over $800 billion, increasing total reserve funds to over $1.5 trillion. For comparison, reserve funds increased only about $27 billion over the twelve months ending June 2008." "Despite their size, the Fed's lender-of-last-resort initiatives (along with conventional monetary stimulus) have not yet resulted in renewed credit flows, as financial institutions have accumulated reserves, but remained reluctant to generate new long-term lending. This lack of effect has suggested to some that the problem goes beyond short-run illiquidity and involves long-term solvency issues." The Treasury's Fight to Loosen Credit "Hence, the Troubled Asset Relief Program (TARP) was initiated. . . . The heart of the program is that it gives the Secretary of the Treasury up to $700 billion to either buy mortgages and other troubled assets or directly recapitalize selected financial institutions." "Arguably, the government will now target, as it does the federal funds rate, the price of risk in the economy. Stabilizing the price of risk may reduce the incentive of financial institutions to hoard liquidity and induce them to return to their role of borrowing short-term and lending long-term, and begin to pass a larger flow of liquidity to the non-financial sectors to support credit dependent spending." "In general, there are at least two ways for TARP to stop the price of risky assets from falling. First, the Treasury can reduce the supply of risky assets by buying them or guaranteeing them (a guarantee reduces the supply because it transforms a risky asset into a not-risky asset)." "Second, the Treasury can recapitalize the financial system either through inducing it to capitalize itself or through the government taking some level of equity position in troubled financial institutions. With recapitalization, the demand for risky assets is expected to recover, exerting upward pressure on asset prices. The initial spending of TARP funds has been for recapitalization." --Michael Himick

Okay, class, put away your books and take out your pencils for a pop quiz....

FRIDAY F U N

• How about a quick game of checkers?
• Underwater view of fish getting nabbed by bird
• Bad paintings of Obama
• Smell just like Star Trek
• Force yourself to read two pages a day from a good book
• Mutant Vegetables
• Tiny animals on fingers
• Thousands of money-saving tips

This pretty much says it all....

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