View From the Back of the Bus

Mainstream Canadians must be getting accustomed to the view from the “back of the bus”. There has been little public reaction to the most recent actualization of the some are more equal than others philosophy which governs this country. The latest example was the rush to meet the demands of native groups for first in line protection from the ravages of the world swine flu pandemic ahead of the needs of other Canadians. On the surface the rationale for this are the higher mortality rates of “native” communities. No one has offered to tackle the single most important underlying reason for such and run the risk of being branded a racist. It is the responsibility of each community to take responsibility for its hygiene, nutrition and education that lay at the root of the problem. The truth however remains unexamined and untouchable. Nunavit has received 22,000 vaccine shots for its’ 19,340 residents; while the rest of the country 5,863,000 to immunize some 33,717,500. That works out to 1.4 vaccine shots per Nunavite but a scant 0.17 per Canadian across the rest of the country.

Now of course the difficult to swallow news that our esteemed (sic.) drug manufacturers have fallen behind in production and are unable to deliver the bulk of promised vaccine deliveries; this will leave 4 in 5 Canadians unprotected against the virus widely heralded as a killer of epidemic proportions.

Thus as most Canadians scramble in line and fight over 1 dose of immunity afforded for every 5 of them; those in Nunavit with favoured status find themselves in the enviable position of access to almost 1½ immunities each. Perhaps they will offer to share the surplus with the rest of us.

Whither the unfortunate children under age ten in the rest of Canada who now have no chance of receiving the recommended two half doses of H1N1 vaccine spread at least 21 days apart, according to the recommendations of Health Canada.

While not politically correct to say it, the unvarnished truth is on this and most other issues; there are two classes of people in this country, but they are not the ones touted by special interest groups

Corporate Bail-Out? / National Sell-Out !

Whether the Great Depression, Britain’s nationalization policies of the past, The Keynesian stimulus has never failed to, well, fail. Public or consumer confidence, if you will, has never gone for the falsity of dollars used to paper over a structurally broken economy. Clearly the Obama Administration, bereft of any real understanding and with no clear solution is running scared. The flight to economics of failure whether of the right or the left underscores the utter poverty of leadership today.

The scale of the bail-outs turns a new page in history. Does anyone really understand the magnitude of it all. Firstly, how many are even aware of the total commitment so far. The tally at this point is an incomprehensible 11.5 trillion. (Detailed in appended table) What does 11.5 trillion dollars of borrowed money actually mean? How about $35,500 per capita or $142,000 for every American family of four? This does not even include further appropriations that will seem necessary as this supposed “stimulus” flounders, as history has shown, as it must. It is well to remember that such astounding debt does not include cumulative interest nor the political price to be paid the chief debt-holder, the government of China.

How bad might it get in America. The Chicago Tribune pointed out (Jan.29) that you can buy a house with a credit card in Detroit these days, the median price of a home in the depressed economy of Detroit having fallen to just $7500! (No, that is not a misprint).

The only event in American history which relates to this boondoggle is the cost of WWII.
The cost of the war in the US was only $288 billion. It’s inflation-adjusted cost, just 3.2 trillion, a relative bargain compared to the unimaginable credit crisis. Of course, the silver lining of the greatest of wars in human history was that those dollars were used to stimulate American production and effectively ended the Great Depression.

If this comparison doesn’t expose the mistaken policy for what it is consider these historic expenditures which combined still only account for about 1/3 of the stimulus.

• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion
• Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost: $217 billion
• Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion
• Savings& Loan Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion
• Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion
• The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)
• Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion
• Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion
• NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion
TOTAL: $3.92 trillion (Bianco Research)

Lacking prudence and experience, Obama has indentured Americans for many generations to come --ironic, considering his origins.

Although taboo topics, Rampant inflation on a scale never before seen in America and the eventual possiblility of war with China as US seeks to escape impossible debt seem necessary outcomes of a

Prudence and common sense should have prevailed.

TABLE OF US "STIMULUS" DOLLARS
Total: Allocated $11.5 trillion Spent $2.2 trillion
Date----------------------------Allocation---Spent
December 2007 Bank BailOut $2.9 trillion $447.6 billion
February 2008 Tax Stimulus $168 billion $168 billion
March 2008 Bear Stearns Bail $29 billion $25.9 billion
March 2008 Commercial LendBanks n/a $90.4 billion1
May 2008 Student Loan Guar.$130 billion $9 billion
Sept. 2008 Fannie & Freddie $400 billion2 $13.8 billion
Sept. 2008 Foreign Liquidity "Unlimited"$375 billion
Oct. 2008 At Risk Mortgages$320 billion $20 billion
Oct. 2008 AutoIndustryFuel Eff $25 billion $0
Oct. 2008 Liquidity Relief $700 billion $296.9 billion
Oct. 2008 Bank Capital Inv $250 billion $196 billion
November 2008 AIG Bailout $40 billion $40 billion
Nov. 2008 Citigroup Bailout $20 billion $20 billion
November 2008 Citigroup II $5 billion $0
Nov.'08 MortgageBackedLoans$100 billion $0
Dec. 2008 Auto Industry Gen'l $24.9 billion $20.9 billion
December 2008 GM Bailout$13.4 billion $9.4 billion
Dec. 2008 CryslerLtd Bailout $4 billion $4 billion
December 2008 GMAC Finance $6 billion $6 billion
January 2009 Chryser Financial $1.5 billion $1.5 billion
January 2009 Bank of America $20 billion $20 billion
Feb. 2009 ForeclosurePrevention $50 billion $0
Feb. '09 Public-PrivateInvestment Unknown $0
Feb. 2009 Unallocated Funds $190.1 billion n/a
Oct. 2008 $ Market Guarantees$659 billion $15 billion
Oct. 2008 Commercial Paper $1.4 trillion $248.7 billion
Nov. '08 Unemployment Benefits $8 billion $8 billion
Nov. 2008 AIG Bailouts $152.5 billion $123.7 billion
Nov. 2008 Defunct Lenders $40 billion $40 billion
Nov. 2008 Bridge Loans $60 billion $37.4 billion
November 2008 AIG Bailouts $30 billion $27.7 billion
Nov.08 Mortgage-Backed Bailout$22.5 billion $18.6 billion
Nov. 2008 Commercial Paper Guar. $20.9 billion $4 billion
November 2008 Citigroup MB's $301 billion $245 billion
November 2008 Asset-Backed Loans $1 trillion $0
November 2008 Fannie&Freddie MB's $500 billion $65.1 billion
November 2008 Fannie&Freddie GSE $100 billion $33.6 billion
November 2008 FDIC Guarantees $1.5 trillion $258 billion
November 2008 FDIC Bank Takeovers n/a $16.7 billion
January 2009 Bank of America $118 billion $97 billion
January 2009 Credit Union Guar. $80 billion $0
January 2009 Fed.Credit Union 1 billion $1 billion
February 2009 State Tax Cuts $787.2 billion $0
February 2009 Tax Cuts Gen'l 212 billion n/a
February 2009 Direct Spending $267 billion n/a
Feb. '09 Appropriations Spending $308.3 billion n/a
Feb. 2009 FDIC Bank Takeovers n/a $1.7 billion

Canada's "Obalma"

Canada’s Seen an Obama Before
Entire Article By PETER WORTHINGTON From the Toronto Sun (Feb., 2009)

It’s fashionable for Americans to say they’ve never before seen such public adulation as there is for Barack Obama. But we Canadians have: Pierre Trudeau.
While it’s true that Obama can do no wrong at the moment (a concern for him and his people who fear expectations are too high), it was similar in Canada when Trudeau became PM in 1968.
There are curious similarities in the two — both charismatic personalities, both achieved the highest office in the respective countries without much public examination or accountability, both were suspect (by some) of far left leanings, both virtually immune from criticism, led by an adoring media which groveled to have its belly scratched.
After a succession of minority governments, Canadians welcomed Trudeau’s majority government — dazzled by his oft-irreverent style, his somersaults off diving boards, his barely concealed contempt for the media, which kept coming back for more.
Obama is half white but is viewed as a black; Trudeau was half English and was viewed as French.
Despite seemingly interminable primaries and the U.S. election campaign, we really didn’t learn much about Obama that he didn’t want us to know. By his mid-40s he’d written two books about himself that were critically acclaimed. When concern emerged about the company he kept, and his associations with a racist pastor, friendship with a middle-aged ex-Weatherman bomber (who was lucky to escape jail), and college Marxists and radicals, most Americans shrugged and moved on.
Trudeau facts
We in Canada knew even less about Trudeau — and didn’t care. Inconvenient evidence was ignored. Heck, our intrepid media were unable to even discover Trudeau’s correct age before he became PM.
When it emerged that he had led a delegation of Canadian Communist Party members to an economic conference in Moscow shortly after the Second World War, staged by Soviet propaganda, people didn’t believe it was sinister. When questioned, Trudeau explained he was scolded in Moscow because he “threw snowballs at Stalin’s stature.” This proved to the Canadian public that Trudeau was a straight arrow.
I was a reporter with the Toronto Telegram, recently returned from living in Moscow, when Trudeau gave this explanation in 1968, and checked meteorological records. The conference took place in April when there was no snow in Moscow. Trudeau had fudged the truth. No one cared.
Obama was excused by Americans for claiming Pastor Jeremy Wright was his religious mentor, despite Wright’s anti-American outbursts (” … I say God damn America”). Ignored was Obama’s deal with an unsavoury real estate figure.
Trudeau’s writings about visiting China and his empathy with Mao Zedong, of whom he said his eyes had seen too much misery, raised few eyebrows, considering the untold millions killed by Mao.
Today, few recall Obama saying that only government could create the jobs needed to restore the American economy, followed by telling Republicans that only the private sector could create jobs to thwart the recession. Contrasting views that raised barely a murmur.
New messiah
Canada, in 1968, hoped Trudeau was the new messiah; Americans in 2009 believe Obama will lead them to a better future.
Forgotten is that in the next election following Trudeau’s majority 1968 victory, his Liberals won the 1972 election by two seats over the Tories. Canada was back to minority government status.
The bloom was off Trudeau, and a lacklustre Tory opposition preserved him until he fell to Joe Clark’s temporary charisma, which faded when Clark couldn’t count and called a vote of confidence election.
Right now, U.S. Republicans are in some disarray, which may be the best thing Obama has going for him, when his various declarations of intent and shifts in U.S. policy fail to materialize or live up to hopes — as eventually they must.

The Crash of 2008

It was all built on a lie and Capitalism itself, proved to be the biggest lie of all. Michael Moore's astute analysis, that the latter day Robber Barons who run today's multinational corporations, as they run, cap-in-hand, for corporate welfare bail-out dollars, have absolutely no belief in the oft' quoted tenets of capitalism, crassly used for years to justify economic exploitation and their need for deregulation from national governance and for globalized free trade.
Anatomy of the Crash
The subprime mortgage crisis exploded, bringing some of the biggest U.S. mortgage lenders and insurers to their knees. The market for asset-backed commercial paper — short-term loans made up of bundled assets, including mortgages and car loans, that investors purchased in droves because of their seeming low-risk and high yields — had been frozen, starving banks and spawning a credit crisis. The Dow Jones industrial average went haywire, dipping and then closing one day in July of 2007 above 14,000 for the first time.

In October of 2007, Merrill Lynch posted a doozey of a loss: $8.4-billion, all chalked up to subprime. Two months later, it was Morgan Stanley's turn: in December, the company posted its first ever quarterly loss: $5.7-billion, also related to subprime.
"I thought there would be a major recession coming, probably one of the worst ones since the big Depression," said Stephen Jarislowsky, the 83-year-old Montreal-based asset manager who Forbes listed as worth $1.9-billion in 2007. "But I had absolutely no clue that the very biggest banks, the biggest mortgage companies, the biggest insurance companies in the world effectively would fail," he said. "I thought the year would be very tough. And I can tell you that the year proved even tougher than I thought by a mile. I think the situation is really very catastrophic."
Two days earlier, a large mortgage lender in the United States, IndyMac Federal Bank, folded, squeezed by tight credit, falling housing prices and mounting foreclosures. Now, the fear of more troubles spread to the country's two main mortgage securitization companies, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). They were in danger of going bankrupt.
Fannie and Freddie's debt was essentially guaranteed by the government in a structure intended to encourage home ownership. But if Fannie and Freddie went into insolvency, the government itself would have a huge credit problem on its hands.
In an effort to avoid that scenario, on the night of July 13, U.S. Federal Reserve Board chairman Ben Bernanke and Treasury Secretary Henry Paulson announced plans to prop up Fannie and Freddie, which Mr. Coxe called "essentially the bastard spawn of a union between expansionists in government and greedy private-sector people."
In particular danger was Lehman Brothers, a top investment bank badly in need of, but unable to find, a saviour.
On Monday, Sept. 15, Lehman, which employed 25,000 people, filed for bankruptcy protection in what was the biggest bankruptcy in the history of the United States. The same day, Merrill Lynch narrowly avoided Lehman's fate by agreeing to sell itself to Bank of America for about $50-billion; insurance giant AIG was rescued by an $85-billion government bailout the next day. Three days later, the government unveiled a massive bank bailout plan, which inspired a brief market up-tick. However, the $700-billion package was rejected by Congress 10 days later. The Dow and the Toronto Stock Exchange recorded what were at the time the largest one-day point drops in history — 777 and 840, respectively. Soon, the reverberations were being felt in Russia, where the market tumbled 18 per cent in one day; there were also plunges in China, Mexico and Brazil.
How Far Will It Go ?
Since the world banking establishment has disintegrated and exists now by virtue of taxpayer subsidy, stock markets have lost enormous value and continue to spiral downward.
Will it match the crash of '29 when the market dipped 23% over two days? No, just 21% last October, but it has fallen a total of 50% since mid 2007. There is little comfort to be had in the knowledge that the Crash of '29 continued to an 80% deadfall by 1933.
Three years ago this commentator advocated selling and predicted a real value of 7000 points on the basis of profit margins at that time. Today, profits have dissappeared; book values, unfortunately suggest dismaly lower prices for stock.

Unemployment levels are clearly rising as tens of thousands of jobs evaporate weekly. Government unemployment statistics are misleading at best as they do not account sufficiently for quality jobs vs. low end employment. Obama's misleading 2009 numbers and even rosier predictions for 2010 employment and economic recovery are shared by neither bank nor accredited risk assessment institutions.
% ************Presidential ***Moody's
****************2009 2010*** 2009 2010
GDP ************-1.2 +3.2 ****-3.6 -0.1
Unemployment *** 8.4 7.9 ******9.3 11.4

Even the FDIC is recoiling with alarming speed at the looming risk and weakening prospects of recovery, having just raised it's account insurance premium rate charged to bands nearly seven fold to 3.2% from 0.5% ! Indeed, Moody's now places the odds of entering "depression" at 25%; up 15% just three months ago.

It is similarly difficult to evaluate conditions on the basis of GDP which is also manipulated statistically. Governments and economists were slow to acknowledge (by December 2008) what the public had known for months that we were, indeed, in recession. At what point will the recession deepen to the point of depression. By and large the public trust has been broken by the fraudulent behaviour of banking, insurance and financial institutions, stock price manipulation, Madof "Ponzi" schemes, subprime mortgage crisis, securities commissions headed for decades by the scions of the investment industry itself. And, of course, now by governments, confused and powerless, bent on bailing out, without preconditions, the very wolves who have pillaged the economy.

It takes no Socialist to see that it was, indeed, all built on a lie and that Capitalism itself, proved to be the biggest lie of all.

The first solution to the mess is bringing the criminals to their knees. Frontier justice would be too gentle. There must be serious accountability otherwise all undertaken will be lost.
The second, to re-establish government regulation across national economies and under will of the people.
The third, reclamation of markets from globalization and the social, economic and environmental exemption globalization has afforded the crooks.
Finally, relief of economic suffering and perhaps stimulus.

Will Obama be up to the task? Will there be "Change You Can Believe In?" I suppose we can "Hope".