Allen L Roland

After Obama's bailout of Wall Street ~ his cry for meaningful reform or new regulations is falling on deaf ears. The so-called Recession has seemingly ended for the financial elite who have a new unlimited credit line from the Fed. Meanwhile Main Street's credit line has dried up, along with their spending, and their nightmare Depression continues unabated. Reform is desperately needed before the next bubble bursts:

We have all witnessed President Obama's cave in to Big Pharma in the Health Care Reform package where the Public option, which over 62% of Americans as well as doctors favor, is now no longer part of the package.

But wait till you see Obama's big fade when it comes to much needed Wall Street reform and new regulations ~ which are purposely too small to succeed and will hardly slow down those institutions which are seemingly too big to fail.

It's all a big game, folks and guess whose paying for it ~ the American taxpayer !

And if you don't think that the American consumer is suffering ~ Reuters reported yesterday that Bank of America Corp and Citigroup Inc.customers defaulted on their credit card debts in August at the highest rates since the onset of the recession, a sign that the banks' consumer lending woes are far from over.

That trend was echoed among most other major credit card issuers, dashing optimism sparked when many banks and specialty finance companies reported lower default rates for July.

Wall Street and obviously Obama's strategy was to bail out the too big too fail financial Institutions, disguise their billions in toxic debt, prime the pump with unlimited Fed money and wait for the American consumer to jump start the economy with vigorous spending and thus re-inflate the debt bubble that just burst.

The only problem is that the American consumer is broke and angry that the people who caused this economic debacle are once again wallowing in American taxpayer bailout money while Main Street falls deeper into a never ending financial hole.

As Tony Sagami writes in Uncommon Wisdom ~ " Anyone who thinks that consumers will rescue our economy from this recession is nuts. Plunging home values and stock prices have fueled a record $13.9 trillion loss in household wealth in the United States since the middle of 2007."

In regards to unemployment, some 9.4 million jobs would have to be created to get us back to the level of unemployment when the recession began in December of 2007. In that regard, Jobless rates rose in the majority of U.S. states in August ~ particularly in Nevada and California.

So let's set the record straight ~

1. Any further monetary pumping, by the Fed, runs the risk of inflicting more damage on the formation of real savings. Consequently, it can only paralyze consumer spending and the US economy.
2. The stock market is being manipulated by the Fed whereas insiders are bailing out while the Dow is being artificially pushed toward 10,000. The Dow will crest after it breaks 10,000 and set the stage for a major correction ~ once the full extent of our financial debt crisis, as well as Wall Street abuses, is known.
3. Top bankers and traders are still making a fortune off our un-regulated system ~ taking huge risks in the process. And they're spending an unprecedented amount of time and money to make sure Congress doesn't change the system ~ much like Big Pharma is doing regarding the current healthcare system.
4. We desperately need full a full investigation into the financial abuses of Wall Street which led to the current economic crisis ~ a modern day version of the Senate Banking Hearings in the 1930s that were named after the chief counsel, Ferdinand Pecora. That could very well be the Angelides Commission which began its investigation yesterday into possible misconduct by the financial sector causing last year's market meltdown.

As Robert Borosage writes in Blog For Our Future ~ " In the 1930s, Wall Street excesses, fraud, and speculation helped feed a bubble that burst and contributed to the Great Depression. FDR stepped into save the banks, reorganize them, and stave off financial panic. But once saved from ruin, the banks rallied, seeking to fend of any serious regulation. Pecora changed that. By exposing the bankers’ misdeeds to the public, by revealing the crimes and the abuses, he helped rouse public anger, and create the conditions for the vital reforms ~ from the Glass Steagall Act to the SEC ~ that helped preserve us from financial crises for several decades. Now once more, Wall Streets crimes and excesses, speculations and frauds have helped drive this economy off a cliff. Government has bailed out the banks and saved them from ruin. Now once more, they are organizing to fend off the reforms vital to making certain we don’t repeat the follies of the past. The Angelides Commission ~ if it fearlessly lays out the facts, exposes the excesses, the deformed incentives, the frauds and crimes, that are at the root of the current crisis has the potential of playing a similar role to that of Pecora." http://www.ourfuture.org/blog-entry/2009093817/angelides-commission-tell-america-what-happened

Both the House Senate are planning to take up Obama's initial reform package next week. Tell your Senators and Representative to get on board now and make sure Wall Street toes the line ~ and let's hope the Democrats and Obama find some backbone in the process.

http://act.truemajorityaction.org/t/120/p/dia/action/public/?action_KEY=38

Allen L Roland http://blogs.salon.com/0002255/2009/09/18.html

Freelance Online columnist and psychotherapist Allen L Roland is available for comments, interviews, speaking engagements and private consultations ( allen@allenroland.com )

Allen L Roland is a practicing psychotherapist, author and lecturer who also shares a daily political and social commentary on his weblog and website allenroland.com He also guest hosts a monthly national radio show TRUTHTALK on www.conscioustalk.net

Cartoon courtesy of Tom Toles / Washington Post

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Allen Roland’s weblog: http://blogs.salon.com/0002255/
Website: www.allenroland.com
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