Things you can't really explain

I saw a mature man yesterday in a bright pink t-shirt yesterday and I realized there a some things that have developed I just totally can't explain.

The t-shirt was one of them, obviously.

Besides being bright pink--no doubt just for attention-getting--said "END THE FED".

You can bet he has strong feelings about this subject.

I've read into this at different times. There's a whole group of people out there with this same thought about the Federal Reserve, that it is this subversive, negative, controlling apparatus in the country and it goes against everything Americans are about.

I don't get it.

What's so controlling and ugly and negative about the Fed?

I saw a local PBS program about our local Federal Reserve office and both it and the main Fed's development.

Geez, it was just created to smooth our the too-frequently recurring panics that took place in the ocuntry, over the years. It controls the money flow so there's enough around when we need it. You know how irrational and emotional people can get about money. They make sure runs on banks don't happen, among other things.

I just don't get it.

The other thing I don't get is the recent development of people creating these clearly temporary tributes to a lost loved-one along the sides of our streets and highways.

They can take all kinds of forms.

One, near my office, is of a white spray-painted bicycle which the family or friend has chained to a street sign, including flowers and a sign.

We all see the flowers, crosses and signs along the roads in differnt places.

One, I saw yesterday, was a big picture poster of the person killed, with their name and date of death.

Wierd, to me.

Another way of doing this is soaping the person's name and their life dates on the back window of the car the family member or friend is driving. I've also seen these with vinyl letters on the backs of cars lately, taking it a little further.

We just can't let people go, it seems.

Funerals and tributes in the newspapers aren't enough, clearly, to these people.

Religions are, for the most part, in my opinion and others, big denials of death, what with their heavens and hells, nirvanas, and people with wings but what are all these roadside and car tribute about? Further denial, it seems.

There must be major resentment that so-and-so is gone, for whatever reason and the people have the leisure time and money--however much or little--to create these things.

I think we need to get over it and just accept we're all going to die.

Anybody tell these people that?

This is how serious the situation is, folks

Paulson Seeks Authority to Shore Up Fannie, Freddie (Update3)

By Brendan Murray and Dawn Kopecki

July 13 (Bloomberg) -- Treasury Secretary Henry Paulson put the weight of the federal government behind Fannie Mae and Freddie Mac, the beleaguered companies that buy or finance almost half of the $12 trillion of U.S. mortgages.

Paulson, speaking on the steps of the Treasury facing the White House, asked Congress for authority to buy unlimited stakes in and lend to the companies, aiming to stem a collapse in confidence. The Federal Reserve separately authorized the firms to borrow directly from the central bank.

The announcements followed weekend talks between the firms, government officials, lawmakers and regulators, after Fannie Mae and Freddie Mac lost about half their value last week. Paulson and Fed Chairman Ben S. Bernanke are trying to prevent a collapse that would exacerbate the worst housing recession in 25 years and deepen the economic slowdown.

here's the orginal link:
http://www.bloomberg.com/apps/news?pid=20601068&sid=aSNZaHL2vs4A&refer=home


Pay attention, folks. This is huge news. These people NEVER get together on the weekends. They NEVER have meetings on Sundays, let alone announcements on the steps of the Treasury. Hell, they don't have to. Things are usually running smoothly.

Not now. Now, they're scrambling. This is big. This will be a big week in the markets.

"Officials from Treasury, the Fed and other regulators worked in close consultation throughout the weekend after growing investor fears about the companies' finances sent their shares and the overall market plummeting last week." (from Yahoo! link below).

Let's hope it all goes well.

The Fed. The FDIC. Fannie Mae and Freddie Mac, both. Hell, they're all engaged here.

"...some of Wall Street's biggest investors believe there was another message in the government's announcement — the rest of the financial sector seems unlikely to get a helping hand. Global banks and brokerages have already written down nearly $300 billion in soured mortgage investments — a number projected to ultimately reach $1 trillion." (http://news.yahoo.com/s/ap/20080714/ap_on_bi_ge/credit_crisis_new_phase)

"Former U.S. Treasury Secretary John Snow said that Fannie Mae and Freddie Mac have relied on leverage to fund their businesses in the same fashion as a hedge fund, and that the government should avoid taking them over."

"Congress ought to be embarrassed" for years of delays in passing legislation aimed at strengthening regulation of the two companies, Snow, now chairman of New York-based buyout fund Cerberus Capital Management LP, said in a telephone interview. He said he suggested when in office that "the business model they were using was really the model of a hedge fund." (from this link: http://globaleconomicanalysis.blogspot.com/)

"A critical test of confidence will come Monday morning, when Freddie Mac is slated to auction a combined $3 billion in three- and six-month securities."
From this link:
http://news.yahoo.com/s/ap/20080714/ap_on_bi_ge/mortgage_giants_crisis

You watch--Lehman Brothers is going down. Mark my words. And that's not the least of it, by a long shot.

Great question from Michael Sedlock at Mish's Global Economic Analysis:

"Since when in a supposedly capitalistic system should it be necessary for the Fed and Treasury to intervene in the markets on a day to day basis?"

More:

"To What Extent Did (Secretary of the Treasury) Paulson Lie?

Now we get to debate the meaning of the following:

"Keeping Fannie and Freddie in Current Form"
"There will be no nationalization of Fannie and Freddie"
"A government takeover will not be necessary"

It seems to me that an injection of $15 billion capital into Fannie Mae and Freddie Mac and creating a new class of Government Owned Securities is most emphatically NOT in agreement with the above ideas.

Paulson Is The Great Pretender

Hell, there is so much pretending going on it's hard to keep track. For starters, everyone is pretending Fannie and Freddie are solvent. If they were solvent there would be no need for a $15 billion injection. Secondly, the government directly owning a new class of shares is not keeping Fannie in its current form.

The big concern is "Where does it stop?" Opening up a $15 billion dollar window will be the first of 10 such operations. This is likely the start of a U.S. Taxpayer Bailout of China."

It's ugly, folks. And it's getting really, quite uglier. As I so frequently say, you'd better start paying attention.

I hope it's not too late.

Fascinating new developments

Fascinating. Really. Are you watching this?

News just out this morning: The Fed is extending 100 more billion dollars to the banks come April, to "combat the effects of a credit crisis." You can see the whole article on Yahoo here:

http://news.yahoo.com/s/ap/20080328/ap_on_bi_ge/fed_credit_crisis

First, of course, is the figure of an additional 100 billion dollars, for its sheer size. But there's much more to it than that.

With all these "fixes", most all of them by the Fed, though one of them, at least, proposed months ago by the private banks, is the fact that these huge amounts of money have to be extended, repeatedly, by the bank to the banks. It's extremely large, let's not pretend otherwise.

What that tells us is that the problems are extremely large, naturally. But, at the same time, I think the Fed and the media, both, are doing a magnificent job of not panicking or suggesting that you and I, the average "Joe" on the street, should be concerned in any way.

Let me say again, fascinating.

They need the situations handled and looked after, of course, but the last thing they want to do is create a "panic for the exits". This is a pretty fantastic balancing act. And since the man on the street isn't really paying attention--yet, anyway--it's been successful. If they can just keep up the preemptive solutions--without breaking the national bank--but also keep people from worrying or over-reacting too much or getting emotional or, worst, getting irrational, then they can bring this broken plane in for a landing.

God, I hope it's a soft one.