Volcker says this could be worse than the Great Depression

Dear Paul:

I said the same thing - in October - 2007.
Where were you?
Obviously, we do not need further regulation or oversight as an abundance has been in place for years. This remains another VERY obvious flaw as it does not work. The 64 dollar questions that remains to be answered is why? What has transpired since 2005 is so blatantly OBVIOUS that the orange flags should have been seen by hundreds, if not thousands, of those in charge of oversight.
Since nothing to deter the madness that was all over TV, newspaper and billboard ads in the form of "0" down, no income check,etc not to mention Sandford and ultra high CD rates I have to ask why do we have these agencies? Why even have the FED? the Federal Reserve was given the power to stop predatory lending after the RTC. How many cases of predatory lending did the Fed prosecute?
I can only assume that they did not find any and, in which case, I can be sure that all members also had their heads in a dark place. The same can be said for the House and Senate banking and finance committees which did little more than hold hearings to that they could be on TV. Mr Dodd and Mr. Frank are not living in the same world as those that will bear the brunt of all of this inaction. The OFHEO was in charge of Fannie and Freddie and that small mess. Since he is still on the job why complain about the banking and auto CEO's. Pelosi gets a government jet to take a junket to Italy, along with a small delegation that is going to cost over a million.
It will take a taxpayer revolt and a major cleaning in Congress before all of this stops. I am willing to be that when all the facts become public we will have a repeat of what caused the RTC - Congressional interference in the watchdog agencies. At this point this is blatantly OBVIOUS as it is difficult to believe that thousands of people could be working in a sewer - and not smell anything.

The FED and Congress are the cause of the major economic problems of the last 100 plus years, period. The FED is of no use and does more harm then good. Congress should be held 100 percent accountable for any banking rules and policies of the government that caused this. WE need a currency that has a fixed standard attached to it, gold, silver, platinum etc. They have to have it to print it. No more of this fiscal irresponsibility, live on what we produce and that is all.

The blame rest squarely on the captain of the ship of the time former President Bush. He cared more about union busting than saving the USA's last great industry. In doing so caused the market to drop 1,000 points and investors lost belief. That's truth, that's the mind set that got us here.

The last time things deteriorated this quickly was when Volker was heading the Fed. 22% home mortgages killed the housing industry and led to shortages that later translated into soaring prices followed by another bust.

you can check up how the USA can get out of its problems without spending a single cents of taxpayer money !!

Even now , a silver lining in china USA new turn in good relationship. How about doing a worker exchange program where there should be a net increase in jobs created with both housing and auto problems solved !!

Read more below.


http://financialmeltdownsolutions.blogspot.com/

Any rational intelligent person should have been able to foresee the economic disaster to some extent. Those who did speak out were labelled "doom and gloomrs" or branded as being "negative".

Congress is unequivocally the PRINCIPLE CLUPRIT in all of this. Basically, the vast majority of Congressmen "sold out" to the elitist corporate/ultra-wealthy special interests groups. At the behest of the special interests groups (contributions to political campagins and "other contributions), Congress ENABLED and ALLOWED the corporations to orchestrate and to perpetuate the pyramid and Ponzi schemes, the "derivatives" FRAUDS, and other Frauds.

The tools of reulation and oversight existed; however Congress: 1) Allowed some of the regulations to expire by not renewing the legislation for the regulations; 2) "relaxed" the implementation and/or enforcement of some of the regulations; 3) REFUSED to enact any additional legislation; 4) politically undermined the functional operation of the regulatory oversight agencies.

The VAST MAJORITY of our Congressmen simply "sold out" to the special interests to allow the irresponsible exploitation of our economy on a wholesale basis. The most notorious of these Congressmen being: Barney Frank (D-MA), Ms Pelosi (D-CA), Mr. Dodd, Mr. Reid. Mel Martinez (R-FL), etc.

In the latest scandal of an obvious Ponzi scheme by R. Stanford, Bill Nelson (D-FL) was purported to the beh "highest paid" Congressman ($45,900.00 to his political campaign) of many Congressmen of BOTH parties, who subsequently VOTED AGAINST legislation for regulations that would have exercised more oversight over Standford's financial enterprises.

The ONLY SOLUTION for our economic problems is via reasonable regulations and effective oversight to INSTILL INTEGRITY in the financial reports and functional operation of our corporations.

Congress is the "gate keepers" of the stability and integrity of our economy; and they SOLD OUT our nation and the American people; and they sold out our nation for a pittance of the value of it all. The vast majority of Congressmen should either resign or be removed by recall elections. These Congressmen are as arrogantly corrupt as the CORRUPT CEOs who orchestrated the FRAUDS that have led to the demise of their corporations. And these CORRUPT politicians and CEOS are STILL in power and "heading up the recovery fiasco".

The American people must purge our society of these truly CORRUPT politicians and CEOs if we are ever going to be able to recover from these debacles.

""Evil" exists and predominates because "good men" do nothing . . . ."

These CORRUPT politicians and CEOs are so delusional, and so concerned with CYA'ing for what they have done that is destroying our nation, that they will never be able to do what is needed to restore stability to our economy. They are too busy "gaming the bail out" to do anything worthwhile.

It is up to the American people to save themselves, if they can.

Neither a Borrower or Lender Be ! ! ! Banking is
about debits and credits, not credit cards and
investment banking..............Bank Modernization
Act of 1999 was a serious mistake, followed by
Community Based non-profits lobbying for more
home ownership.............and the NLRB Realtors
jumping on the sinking ship..............Democrats
could not resist this Bubble............or even Alan
Greenspan...........what a sad commentary on the
Best and the Brightest ! Yes, Paul, you're right
but no one listened to you, except over dinner !
Even the GOP suckered on this fantasy, Bush
and the Treasury were sound asleep at the
switch along with House and Senate, and of course the Money Center Banks were going over
the Cliff in record time. What a mess of Trust
and Fidelity in Government, now a private banking
system like Germany, to avoid the political jokes and antics of the populists and the Realtors.

Craig in #3

By your comment I assume you weren't around to witness the economic malaise that precipitated Volker's cure. No, the high interest rates weren't pleasant, but the cure worked.

Volker did what no one else could...he eliminated the runaway inflation that was every bit as scary as the situation we find ourselves in now. The fact that we subsequently chose to indulge ourselves causing more problems is no fault of his.

Your criticism of Volker is equivalent to blaming Lincoln for the economic problems that followed his successful leadership during the Civil War.

Actually, I was around to witness the Carter/Volker destruction machine at work. What broke the back of inflation was not his insane credit squeeze but Reagan's standing up to the air traffic controller's union and ending union domination of labor negotiations. Second, was the end of the Arab oil embargo. Volker was a dismal failure because his policies caused more damage. The libs are about to do it again.

Earlier they said this is not worser than Great Depression. Now it almost appears to be Great Depression 2.0. The new version will always be advanced compared to older version. This is also a kind of soft depression.

No matter how much fast things fall or get worse, there will always be intermediate periods of prolonged pause, like the present one we had for four months, that provide investors good chance to help themselves. But this also leaves them with confusion.

The best way to revive these problems to start at the root of the economy. That is to build back the consumer confidence that is now at all time low. Whatever is done this must be the goal otherwise nobody will spend, but only will cut back, cut back and cut back. That takes the economy further down.

Thanks.
-fornls.

Do You Sell Shares in Panic?
http://bizcovering.com/investing/do-you-sell-shares-in-panic/

How to Find Out When to Short a Stock?
http://bizcovering.com/investing/how-to-find-out-when-to-short-a-stock/

How Should an Investor Behave When a Scandal Occurs in His Stocks?
http://bizcovering.com/investing/how-should-an-investor-behave-when-a-scandal-occurs-in-his-stocks/

Craig, since you "were around" I'm surprised you don't remember that the Arab oil embargo only lasted until 1974, so I doubt highly it had anything to do with our 1982 recovery.

I wouldn't blame poor Jimmy Carter for the mess he inherited either, any more than I blame Obama for this one. The inflation spiral was a result of Lyndon Johnson's attempt to finance guns and butter at the same time without a way to pay for them.

Reagan's move against the union for air controllers might have been a good political move but the real death blow for inflation were Volkers policies.

In all liklihood it will go down as the most effective monetary policy ever by the Fed, since today's economy is not nearly as responsive because of the way world finances work today.

Dubai real estate will decline by another 45%