Examiner | December 10, 2010
By MaryHolloway Love

There is too much information being disseminated among the public currently for anyone to be able to absorb it all.  It is difficult for those without a background in Finance in the real world to explain to the general public what many have been crying "Foul" about for years.

It has been disclosed that there was not only $3.3 Trillion Dollars in the Financial Bailout, but actually another $12.9TRILLION off-balance sheet transactions, many of them to foreign banks, one of whom was Barkley's Bank of London (as previously disclosed in this column as the largest single receipient of Fed Rescue Funds of $59.6BILLIION Dollars) and then the Barkley's Bank of New York also received a huge amount of the bailout funds, too.  Many of the well-known names were among those getting the giant's share: JP Morgan/Chase, Citi, Goldman Sachs and Wells Fargo to name a few.  In return, the American taxpayer was given worthless "illiquid assets" with a value assigned to them so as to create the illusion of stability and capital reserve requirements being met.

When the House of Cards began to crumble, the Fed went into overdrive and started issuing more Treasuries with less foreign buyers showing up for the acutions, so the Fed began monetizing it's own debt, even though Fed Chairman Ben Bernanke, swore under oath before a Congressional Committee that he was NOT.  With unemployment continuing to climb to historic heights, and inflation being much higher than official government figures, the Fed decided to "stimulate the sluggish economy" with a second quantative easing, QE2, which only succeeded in dashing the dollar, spiking the prices of commodities and precious metals globally, and the $600Billion worth of Bonds that the Treasury intends to sell will not be completed until June, 2011.

Then the Mortgage Bubble which had burst to help jumpstart this crisis was exacerbated by the mortgage foreclosure fraud perpetrated upon innocent and some not so innocent homeowners; however, that led back to the examination of the mortage origination documents and actions, and many of those examined were found to be questionable at best, and fraudulent according to several court rulings.  As the market prices for homes plummeted, and jobs were lost at an alarming rate, our Congress did little to help the middle class; instead, it did all it could to regulate more heavily small businesses in this country, shove an overblown, multi-agency creating atrociy of a "Healthcare" bill, which was opposed by more than 62% of the voters and immediately impacted the economy negatively at a time when they could have been considered culpable. Three of the largest corporations in America took billion dollar write-offs on their balance sheets in order to comply with the taxation rules within this Obamacare Bill that was for our "own good."  Even Speaker Pelosi had the audacity to say, "We have to pass the bill before we can see what is in it."  The provisions in that bill are as much an economic nuclear bomb as any other to come down the pike, with the exception of Cap and Tax, which we can only hope is dead in the water.

The Commercial Real Estate Market has been losing value each month, and now has begun to drag the price of resedential real estate prices with it, at a time when it looked as if the residential maket might have bottomed out, except now the ecnomists and analysts are calling for an additional 20% decline in the value of homes.  When the Commercial Real Estate Markets implode as the residential markets did, coupled with this horrific information on the Federal Reserve's Actions, and faced with the Municipal Bond Market Blow-up, even though insured by AMBAC and MBIA, there is not enough reserves anywhere to cover the losses when cities and states begin to default on these debt obligations.  Many pension plans, 401(k)s and individual investors purchased these because they were AAA rated, insured by AMBAC or MBIA, exempt from Federal Income Tax on the interest earned, and now, they  too shall join the junk pile of the bill of goods that has been sold to the Middle Class which is rapidly disappearing.

To discover that the Federal Reserve, though a Private Banking Concern, took American Taxpayers money, and gave it to foreign banks in such places as South Korea, Indonesia, Malaysia, and other countries that were considered our enemies, not even our allies, though they too, were at the trough, is inexcusable and yet probably not prosecutable, under the Federal Reserve Ace of 1913.

Gold and Silver are looking shinier than ever, as are commodities, including the unpopular "coal" which is being used in great quantities in China.  (As an aside, China now manufactures and exports to the US our favorite toy from the 60's-the infamous "ETCH-A-SKETCH.")  Ask any analyst, economist or trader where the "safe money" is going, and one will receive a different answer from each.

Look for markets to be mixed, and commodities to continue to the upside, though with oil tipping at $90/barrel, that cannot be good news for this ailing economy, though it will not affect the Government's Consumer Price Index which is used to measure inflation, since the costs of FOOD and ENERGY (gasoline, electricity, propane, butane, etc) ARE NOT INCLUDED IN THE CPI, so that the inflation figures that the government has been feeding us, have not been an accurate reflection of the rising costs of products nor the falling purchasing price of our dollar.

Merry Christmas.