[~Candy~]

Good news


Consumer credit has record drop in August

WASHINGTON (MarketWatch) - U.S. consumers reduced their debt load by a record amount in August, the Federal Reserve reported Tuesday. Total seasonally adjusted consumer debt dropped by $7.9 billion, or a 3.7% annual rate, in August to $2.58 trillion. This was the first decline since January 1998. Consumer credit rose 2.4% in July. Non-revolving credit - such as auto loans, personal loans and student loans - dropped sharply by $7.3 billion, or 5.4%, to $1.61 trillion, after rising 0.9% in July. Credit-card debt dropped by $612 million, or 0.8%, in August to $969 billion.


http://www.marketwatch.com/news/stor...7D&siteid=bnbh

[Paquadez]

I am aware of the ever present attempts to subvert regulation.

I was just wondering if we were on the gold standard if it would have reached these extremes. In other words I suspect credit would not been as stretched as far as it was.

and the other part of the equation was the pressure on banks to lower the standards they used to provide credit. lots of parts to the puzzle

Perhaps the hidden cause is what is called Fractional Reserve Banking (or Lending).

http://en.wikipedia.org/wiki/Fractional-reserve_banking

This has led to banks easily adopting ever growing debt obligations, without the real reserves to back them up.

What we are seeing now is the beginnings of the feared Domino Effect.

Increasingly, banks have picked up funds from other banks via the global Interbank Markets rather than traditionally, from depositors.

As credit and risk becomes of vital concern then lenders call their money: i.e. demand it back.

However is the borrowing bank has lent out the money then they can't instantly repay.

The same scenario is replicated throughout the system and once the first bank falls over the rest follow suite: hence Domino Effect.

In the 1980s, the Fed and the NDIC bailed out and took over Continental Illinois, then the tenth largest bank in the US: mainly since Paul Volcker, the last sane head of the Fed stated that if they had let CI sink then the Domino Effect would have probably been triggered.

http://www.erisk.com/Learning/CaseSt...alIllinois.asp

[iltos]

Originally Posted by AcaCandy

Good news


Consumer credit has record drop in August

WASHINGTON (MarketWatch) - U.S. consumers reduced their debt load by a record amount in August, the Federal Reserve reported Tuesday. Total seasonally adjusted consumer debt dropped by $7.9 billion, or a 3.7% annual rate, in August to $2.58 trillion. This was the first decline since January 1998. Consumer credit rose 2.4% in July. Non-revolving credit - such as auto loans, personal loans and student loans - dropped sharply by $7.3 billion, or 5.4%, to $1.61 trillion, after rising 0.9% in July. Credit-card debt dropped by $612 million, or 0.8%, in August to $969 billion.


http://www.marketwatch.com/news/stor...7D&siteid=bnbh

hmmm....i wonder how much of this is due to equity lines of credit?

[iltos]

Originally Posted by LANMaster

Good one.




Here

LOL....that sums it up nicely

[LANMaster]

Originally Posted by iltos

LOL....that sums it up nicely

I had a feeling that you might appreciate that.



Now look at this

AIG Executives Blow $440,000 After Getting Bailout

If you'd just gotten a government bailout, you might be tempted to hold a retreat at a nice California hotel -- and that's exactly what AIG (American International Group) executives did.

The committee on Oversight and Government Reform held a hearing on Tuesday at 10:00 a.m. Eastern time. to address and examine downfall of AIG, the world’s largest insurance company. The committee planned to discuss the financial excesses and regulatory mistakes that led to AIG’s government bailout.

One of the items discussed was AIG’s expenditure of $440,000 for a corporate retreat at the St. Regis Monarch Beach resort in Los Angeles, Calif. These funds were spent on Sept. 22, a week after the Federal Reserve extended an $85 billion emergency loan to AIG to keep it from going bankrupt due to insurance liabilities.

Click here to see the full hotel bill

According to the receipt from the St. Regis, the eight-day company retreat was a lavish one -- $139,000 was spent on hotel rooms, while even more money -- $147,301 -- was spent on banquets. Another $23,380 was spent on undisclosed spa treatments and another $6,939 was spent on golf. A full $9,980 was spent on room service and food and cocktails at the hotel lounge.

[Wino]

The following makes me wonder why the hell I've spent my life being fiscally responsible. Never missed a loan payment, never paid late fees - and what do I get out of all these bailouts??? Not one goldarn, aw shucks one red phenny.:

AUSTIN — An estimated 30,000 Texas homeowners with mortgages from Countrywide Financial may get friendlier loan terms through a settlement announced Monday to help rescue those in over their head.

The deal involving the company and several states allows eligible homeowners to modify terms of their loans to make monthly mortgage payments more affordable.
The loan modification program affects Texans who are in default or likely to default on subprime mortgages from Countrywide, a financially struggling company acquired by Bank of America.

Possible help measures include:

•Lower interest rates to as low as 2.5 percent for up to five years.

•Conversion of adjustable-rate mortgages to fixed-term loans.

•Reduced principal loan amounts.

•Suspension of foreclosure for eligible homeowners who are in default but want to stay in their homes..................................................................

http://www.mysanantonio.com/business...00_Texans.html

I would love to get some of that reduction in interest rate for five years, right along with reduced principal - Hell throw in some tax relief, too!!

[LANMaster]

SNL Does a great job in this bailout skit

[eggplant43]

Not for the fainthearted:


http://www.nakedcapitalism.com/2008/...rises-not.html

[iltos]

Originally Posted by LANMaster

I had a feeling that you might appreciate that.



Now look at this

well, next time someone gets down on the crooks who abuse the welfare system, i can bring up these bozos
how could ANYBODY in their situation justify this?

[LANMaster]

Originally Posted by iltos

well, next time someone gets down on the crooks who abuse the welfare system, i can bring up these bozos
how could ANYBODY in their situation justify this?

I'd like a list of those who organized this waste.

[~Candy~]

Originally Posted by LANMaster

I'd like a list of those who organized this waste.

I think you can start with Bush

[LANMaster]

Originally Posted by AcaCandy

I think you can start with Bush

You've been infected with a linsky virus.

[~Candy~]

Originally Posted by LANMaster

You've been infected with a linsky virus.

Nope, but, thanks for the comparison

Just sick of what's been going on lately. I, unlike some others here, CAN see the forest and have the logic to be able to change course, instead of just going with the status quo. As you know, I supported Bush early on in his administration. But, the man has gone wild.

You'd better get out some anchors and tie that 401K down or have the smarts and ability to tell your plan administrator that you want your account OUT OF the stock market. NOW.

[~Candy~]

Here you go More GOOD NEWS

Dow to Fall ANOTHER 2,200 Points
by Martin D. Weiss, Ph.D. 10-07-08



Whenever President Hoover Tried to Give
A Pep Talk, the Market Crashed Some More

After the Crash of 1929, President Hoover called together a group of the nation's business leaders for a special meeting in Washington. His message to the executives went something like this:

"When you go back home tonight, you're going to do the right thing for our country. You're not going to lay off employees. You're not going to stop hiring. You're going to do everything in your power to keep the economy going."

But instead of following his directive, they did precisely the opposite, taking major steps to reduce their work force. Their reasoning:

"If the President is taking the extraordinary measure of calling us to an emergency meeting in Washington ... if the president is so concerned that he feels compelled to tell us how to run our business ... then that must mean the economy is actually a heck of lot worse than we thought it was."

The same perverse pattern is spreading throughout the financial markets this time. Two prime examples:

On Friday, when the President signed into law the $700 billion bailout package, instead of bolstering confidence, it turned out to be a major blow to confidence.


And today, when the Fed announced it was taking the extremely radical measure of buying corporate commercial paper, instead of reducing pressure on the financial markets, it merely spread the fear.
This is not exactly the recipe for a bottom in the Dow. Quite the contrary, consider any rally — no matter how fleeting — a selling opportunity.

http://www.moneyandmarkets.com/Issue...00-Points-2403

[lotuseclat79]

Economists: Tough measures needed to cure economic ills.

An ailing financial industry is going to need strong medicine to pull out of a deepening credit crunch brought on by risky loans and deregulation, Purdue University economists said Monday.

"You can lead a bank to liquidity but you can't make them lend," he said.

"Short term bad, long term better," Chakravarty said.

Abbott said there is one bright spot amid the dark news.

"The most positive note I've seen is Wells Fargo and Citibank are fighting it out over Wachovia," he said. "They both want to buy those assets at the fire-sale prices now available."

Yee-hah!

-- Tom