phil from Edmond

Why We Must Act Now on Our Economic Structural Problems

The first problem to fix is the trade deficit. But, 3(b)-(c), might worsen it by the "beggar thy neighbor" implications. Home grown energy to reduce the need for imported oil is most important. Unfortunately, that means shale gas, off-shore oil, coal and nuclear as well as the environmentally correct wind and solar.

Serious campaign reform, 5(a), and regulated lobbying, 5(b), might occur as a result of taxpayer revolt, town meetings and active interest in legislation

Financial Crisis: Remembering What Got Us There Is Critical

This article is excellent. Your point on European banks is important. Another fact to consider is that the AIG credit default swaps supported the European banks leveraged position. Another point I would suggest is how truly benign was the US trade deficit?

The Fed was of the opinion that the US was satisfactorily repatriating these dollars. But in actuality the returning dollars were stimulating the irrational housing market.

In Europe, the banks were lending heavily to Eastern European economies.

The Fed and the G20 thought they had a workable system and were successfully transitioning China, India and Eastern Europe into the capitalist system. They were wrong.

What Obama Needs to Know about Tim Geithner, the AIG Fiasco and Citigroup

Maybe we will get to bankruptcy with AIG but it will be after foreign banks are paid off. The footnotes to AIG indicated that foreign banks were holders of a large amount of CDS and were using them to meet Tier 1 requirements. At 12/31/07, AIG expected these positions to be extinguished in 18 months.