F. George McDuffee wrote:
On Thu, 29 Oct 2009 20:13:12 -0700 (PDT), Too_Many_Tools
wrote:

I am interested in hearing your opinion as to how this Country should
fix "The Problem".

Here is a story about how the Obama Administration is approaching it.

TMT


Financial overhaul bill gets wary reception
By JIM KUHNHENN and ANNE FLAHERTY, Associated Press Writers Jim
Kuhnhenn And Anne Flaherty, Associated Press Writers
Thu Oct 29, 6:30 pm ET
snip
It does not appear that Obama, Frank, et al. read this newsgroup,
nor do they appear to pay any attention to people that ask too
many questions/observations even when directly emailed, thus this
is an exercise in venting.

It appears that a major, albeit unannounced, change in the
operational government/governance of the United States and
several other major countries occurred in the late 80s and early
90s to the effect that while the forms of government remained the
same, the actual control is now by the major, mainly financial,
corporations.

To be sure, during the current economic contraction several large
corporate players were "whacked," but Wall Street now operates in
the milieu of the godfather and not the free market.

In and of itself this change would not be a disaster, but it
appears the dons [even those that graduated from Yale or Wharton
and whose names don't end in "i"] now running the corporations
and their capos are loony tunes whack jobs.

Gangsters fighting among themselves for "rights" to certain
geographic areas and particular rackets have a long history and
have left a long trail of bodies. Lehman Brothers and AIG are
just very large and very recent ones. In this connection it is
well to remember the Vietnam era adage, "when the elephants fight
the grass gets trampled" (along with us **** ants and
anyone/thing that gets in their way).

It is clear what must be done, but it is also clear it can't be
done, short of a bloody revolution and the establishment of a
second U.S. republic.

No George, but we will likely have what is the "reasonable" alternative.
Thinking that what's gone on to date has "saved" the US economy in any
serious manner is an illusion. Dillusional, in fact.
The only thing the world was saved from was immediate and catastrophic
collapse.

Our political leaders threw away a perfectly good crisis/opportunity to act
forcefully without the voting public caring much about the carnage.
That time has passed for the moment but such a time will come again early in
2011.
Employment has never been as low as it is right now and it's going to
continue to shrink.
Capacity utilization is also continuing to decline if you add back what's
being removed permanemtly or temporarily from the pool.
The US is six percent of the labor pool away from havimg the rate hity 50.
It will. That's sort of a tipping point, in my opinion, in a consumer driven
economy.

Regional banking institutions that haven't failed are extremely weak by any
reasonably prudent standard and they will continue to weaken. Those that are
failing now aren't in trouble because they weren't prudent. They are failing
because their customers increasingly don't have the income required to repay
their debts. This is one of the direct consequences of two income families
and the encouragement they got to take on debt at the two income level.
Another is that with two incomes, there is less pressure to keep wages in
line. Rather than increase the earnings of, for instance, a Mold Maker or
Tool and Die Maker, spouses went to work. That second income has proven as
problematic in the long run as it was beneficial in the short.

America, as an economy and a country, has fewer and fewer consumers, even as
families, able to earn enough to satisfy the obligations they have, let
alone go out and consume more.

Everything you wrote beyond this point is as completely obvious as it is
impossible to get done in our system.
Reinstating G-S alone would be catastrophic in it's consequences because it
would be so complicated a migration from where we are now. That's what
Congress has to deal with and they have decided that it's to complicated a
maneuver for them to enact as law.
I agree with them.

What I think is that we'll just fall completely on our collective asses.
Rebuilding from scratch was a real advantage for FDR and it will be for
Obama and his team.



--
John R. Carroll