FDIC – Shortwoman.com

Looks Like Rain

Most people don’t carry around an umbrella unless they think there’s a good chance of rain.

That being said:

The Federal Deposit Insurance Corp. board approved interim guidelines to help clarify its procedures for liquidating complex financial firms [edit: that is, “too big to fail” firms] when they collapse, including permitting better treatment for some creditors when it benefits the estate or broader economy.

However, in the event of an impending implosion, the statute authorizes the FDIC to use U.S. taxpayer dollars to make partial payments to “healthy” counter-parties of the failing firm so that they wouldn’t go down with it. Once economic disaster is averted, the law requires the government to recoup the costs of the bailout by selling the bank’s assets and by collecting fees from big financial institutions with $50 billion or more in assets.

So then, the question as I see it is simple: which big bank does the FDIC expect to collapse? My money is on the one that declared last week that they were halting all foreclosures in all 50 states.

In closing: Mankiw is an idiot; what made them think that was a good idea??; I would rather take my chances with the slot machines; in denial; she can raise money but can she stop being crazy?; epilogue to cholesterol story; “I don’t know if he’s qualified to be on the Federal Reserve Board. He’s only got a Nobel Prize in Economics“; This Angry Season; and recovery.

Wouldn’t that be nice?

Taken at Clark High School in Las Vegas.

In Closing: Foreclosure mess (update, Bank of America has halted all foreclosures nationwide); new 300 year old Vivaldi concerto; progressive agenda; we have to be better; I hope the FDIC bankrupts these [redacted]; always check your work; on Afghanistan; 30% of unemployed have been out of work for at least a year, and the number of jobs in the economy went down last month (no wonder bankruptcies are up); good idea; speaking of food stamps; “none of the above“; new style CPR; sometimes it’s how you say it; and cell phones don’t and can’t cause cancer (“physics shows that it is virtually impossible for cell phones to cause cancer”).

Oh and one more thing! Surf over to Vegas Video Network to see my new show later today!

On One Hand We Have GDP; On the Other We Have Reality

Last month we were told that “Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 1.6 percent in the second quarter of 2010, (that is, from the first quarter to the second quarter), according to the “second” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 3.7 percent.” Sure it did. The government says so and they would surely never tell us something that wasn’t true!!

Meanwhile, in Realityland, the FDIC took over 6 banks Friday afternoon. Canadian news sources are writing about the decline and coming fall of the United States as a “superpower.” This week we learned that the poverty rate rose to a 15 year high, with a 51 year high in the number of people actually living in poverty, 3,800,000 more than last year, including just under 1 in every 5 children who contrary to what some people think have no control over their circumstances. Despite the passage of a new health insurance reform bill, the number of people with health insurance dropped for the first time ever. The net worth of Americans has dropped roughly $12,300,000,000,000 since 2007. The small businesses that are vital to creating jobs both now and in future decades can’t get loans, and the new law that was supposed to “help small businesses” will likely do nothing of the sort. Big businesses are hoarding cash. Some people are calling it a “lost decade.”

Meanwhile millionaires are whining about the very idea that they might have to pay more taxes (when they aren’t screaming about the federal budget deficit) and admitting that they have had illegal immigrants working in their homes (rather than hire an unemployed American).

And the experts wonder why more Americans think a “third party” might be just the thing we need.

Next time, unless I am otherwise distracted, The BAMTOR Principle.

In Closing: let’s hear it for Elizabeth Warren!; “that guy who agrees with me is an expert, that other guy who doesn’t is a quack”; Senator Reid mad at Republicans blocking food safety reforms; “Sorry soldier, you’re too fat for this exercise program”; new rules to make it harder for banks to hide debt (like that will stop them).

The New New Economy is Not Improved

Let me start by pointing out that today alone, the FDIC had takeover teams at 6 — yes, 6 — different banks in 3 different states. I think that Count Von Count would not be happy to keep track of this. Another number that would fail to please the Count but might make Dr. Evil happy, an anticipated one million foreclosures this year. That situation will get uglier before a healthy market can possibly emerge.

But as Expert Ezra points out, the reason people are so unhappy with the economy right now has a lot to do with the fact that corporate profits are up over 5%, the actual number of available jobs is down over 5% just since 2007. And frankly, I am of the opinion that without the economic shell game the government has been playing with the data, you would probably find that the 2001 recession never ended.

So then, with unemployment what it is, nobody should be particularly shocked that retail sales are down, again, and specifically sales of big ticket items are down. Nobody being able to afford goods leads quite understandably to the possibility of deflation — particularly if you can’t find a way to mask housing prices that are down by half in some parts of the country. Meanwhile, the rich get richer and the poor can, well, do whatever it is they do.

Add to this toxic stew two items: a political party that still thinks you can raise revenues by cutting taxes, but that making sure that “the least of these” can afford groceries is a bad thing; and a financial reform bill that the nicest thing anybody can say about it is that it’s better than nothing, probably. The safety net is being cut just as we need it most despite our protests, and our largest banks may still have the power to ruin us all.

Next time, assuming I am not distracted by something shiny or butterflies or kittens, The Latte Economy.

In Closing: Gee, greater blogosphere, thanks for noticing what I thought I was too late to say yesterday!; this could be bad; Senator Ensign should really give up now; I wonder how much; and two dinosaurs for the price of one.