See:
Fannie
Mae's bailout tab, by Dan Gainor, Washington Times
Rob Kirby Commentary Who’s Picking Up the Tab? The first three of the above recommended readings should be familiar to our readership. We do not apologize for reminding everyone of the gravity of their importance, however, since many main stream media outlets have simply failed to report the potential fallout of each of these items on Main Street USA. = In gems like this one, Dan Gainor serves up a well articulated morsel, “…Fannie Mae, the government-sponsored mortgage association, has been battling a mounting scandal since last year. It has accounting errors of about $11 billion. That's more than nineteenfold Enron's $567 million error….” outlining the scale of chicanery already uncovered at Fannie Mae [NYSE: FNM] – and the tab’s still open, folks. The Social Security Q & A serves as dessert, or a little bit of light after dinner reading [or an aperitif, perhaps?] – take your pick? Mr. Volcker's masterpiece [which we can’t get enough of as if we are hooked on BBQued Ruffles Masterpiece potato chips and Reese’s Peanut Butter Cups] reminds us all that, indeed, there is a bill to be paid – what with all the fine dining we’ve been doing! Oxymorons Is it just us, or has this occurred to anyone else? What we’re referring to is the U.S. government’s plan to privatize social security. We’re not trying to say it’s a bad idea – fixing something that is broken that is. In fact, if something is broken – we fundamentally believe that one should do all in their power to make it right. But consider that Government sources have estimated that ‘fixing’ social security will cost somewhere between 1 and 2 Trillion Dollars. It has been clearly stated that the proposed means by which this fix up will be effected is with borrowed monies. Current U.S. fiscal and balance of trade deficits combined, are somewhere in the neighborhood of 1 Trillion [give or take a couple hundred billion either way] annually. Foreigners are counted on to absorb perhaps 75 % of these gross new borrowings each and every year [the entire current account deficit as well as 40 % – 50 % of the fiscal budget deficit]. As former Fed. Reserve Chairman, Paul Volcker points out, “…The United States is absorbing about 80 percent of the net flow of international capital…." With the above information being undisputed fact, we ask, how could America - let alone anyone borrow an additional 1 – 2 Trillion dollars when existing borrowing, of about 1 Trillion, is already 80 % of global savings? On our planet, such a proposition is sometimes referred to as an oxymoron.
In our opinion, the mere proposition that new borrowings of this scale are possible is nothing short of hubris. To believe that such incredulous borrowing plans have any chance of success whatsoever would require overt deception, deceit and temerity – as well as a generous supply of unwitting victims [dare we say the John and Jane Six-Pack American Public?]. Where would anyone go to find such a generous supply of unwitting, uninformed human beings? Answer that, dear reader, and you’ve answered the Fed and Treasury’s latest 2 Trillion dollar dilemma – just remember to smile when your waiter asks, “Will that be cash or Visa?” The ability to create [articulate?] money out of thin air by the symbiotic relationship of the Federal Reserve and the Politicos inside the Beltway is now achieving an ultimate art from in chancery and magicianship – Welcome to the World of Mandrake, the Magnificent! Just paying the minimum on that Visa, Discover, or Master Card? Ehhh, you folks will probably be getting notification real soon that those pesky minimum payments may double. Ouch! Lady DiMartino down there in Dallas also appears to know that things are not what they seem. She probably remembers when folks moved out of their homes in the middle of the night leaving the keys for those rascal mortgage banks and S&Ls during the last Dallas-Ft. Worth Housing Bust, perhaps? Gold money? Instead of paper? Gee Whiz! What a novel idea. Gold comes out of the ground, is mined and refined into both fiduciary and commodity money. It takes a lot of effort to produce just one ounce of gold, or silver, for that matter. No matter how hard the Alchemists tried to turn lead into gold, the periodic chart of Mendeleyev, indicates that it cannot be done. Creating paper funnie monie out of thin air – now that truly is magic – paper and ink have value. Who’s picking up the tab for the destruction of this paper money fraud? As ee cummings would say: Anyone lived in a pretty how town… Very Truly Yours, Rob
Kirby, Toronto, Ontario, Canada © 2005 Realty Reality |
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