Falling from the Cliff - US and Global Markets

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Falling from the Cliff - US and Global Markets Powered By Docstoc
					Ref: 09-036A of 25-Dec-2009 (Merry Christmas Day) Steven Spielberg is considered one of the most gifted and visionary director in the world. He could not only visualize but also gave concrete shapes to the characters that became life size symbols later. Unfortunately, he never handled a political, financial or economic theme for simple reason that he could not visualize the complexities of current financial crisis engulfing his own nation – United States of America. President Obama, one of the rarest breed of gifted speakers, has turned into a con man. He is a successful diversionist not revisionist lawyer, Senator or President but to borrow the phrase from Jim Carrey’s dictionary – Liar and Liar. I thought the uneducated Indians in the villages or woo doo tribes in sub-terrain landscape in African continent were the only bunch of superstitious religious zealots. Never before I thought that the educated mass of Americans could rival them in the practice of superstitions. If the Hindus, Muslims and Africans could follow their religious leaders blindly, the Americans too follow their political leaders with same zest and vigor. They also believe blindly or superstitiously that their King or President could do no wrong. They do not realize now that USA is following a strict pattern of USSR and its days are now numbered unless something is done drastically to address the situation. A good leader should be a good orator, but a good orator need not be a good leader. Sen. Obama, a distinguished orator, won his presidency not because of his strength but due to the weakness of GOP – or Republican Party badly bruised by erstwhile President George W Bush. He could use his oratory skills to whip up the anti-GOP sentiment to win the democratic nomination defeating the Hillary Clinton and then defeating John McCain to win the Presidency. In short, he won due to the default of the other. Oratory is a great asset for him, but he has to use it to his and nation’s positive advantage. Yes, he inherited the bad legacy of burning nation from the President Bush. Nothing new. Almost every President inherits some or the other bad legacy from predecessor. Even President Bush inherited the regime of artificial low interest rate from President Clinton, Rupert Rubin (then Treasury Secretary) and Alan Greenspan (Fed Chairman for 18 years by now) that sow the seeds of the massive derivative contagion.

Instead of engaging in a blame game, he has to go back to basics and discard immediately whatever is not working. He has to focus only on economy, not on health care. There are many unknown brilliant Americans out there in Fed or Treasury who can offer him solution. It is his job to extract the best out of his own people. He no longer has to depend on Bernanke or Geithner who have miserably failed over a year or more. Instead of announcing “Head price” on Osama Bin Laden or Saddam Hussein in the past tagged at US$ 25 millions, he has to announce similar competitive prize of say first 20 prizes of $ 2.5 millions each with top honor getting $ 25 millions to all those who can provide innovative solutions to the current economic problems. He has to fund a TV Channel exclusively engaged in the debate on economic malaise and seek intense debate from scholars, students, economists, researchers to suggest way out of this situation. His emphasis should be on what to do in future rather than analyzing the past. Something will come out good of these efforts. Spending a few hundred millions here is more worthwhile than funding demands of bankrupt giants running into trillion dollars. Many officials in Fed and Treasury, who know the potential solutions, are not able to get their views expressed across. They would be afraid to offend the officials at the top. The open public debate will force them to come forward, participate in the national competition and express their views or suggestions to bring the country out of turmoil as soon as possible. A $2.5 millions to $ 25 millions Tax free prize is a lot of money for any American under present circumstances. Spending $ 25 millions more at home to find solution for crisis is lot better than spending similar sum or a dime abroad in Iraq or Afghanistan in search of terrorists. President Obama forgot that he was appointed President for 4 years – up to January 2013 latest. Having seen his inadequacy to address the immediate financial problems, he set upon himself a convenient mode to divert the attention of the American people by any means. He adopted the following diversionary tactics successfully: 1. He started showing moon to the American people. Having seen the oil prices zooming to $ 145 per gallon, he found convenient tool to exhort the American car manufacturers to “go green” and invest into green technology that would reduce oil consumption, pollution and carbon emission. a. Such cars to be commissioned by 2014 to 2016 when he will no longer be around. b. What is the point of talking such non-sense when the immediate need was to set the financial house in order, stop the mortgage hemorrhaging, foreclosures and create the jobs and help the local Auto manufacturers to dispose off the existing car inventory in the ware house and on assembly lines? 2. He then became champion of another green technology – Solar Energy – which will take years and billions of dollars before that technology became available at reasonable cost on mass scale. Again, he was showing moon to the American people by showing distant calendar of 2016 to 2020. 3. He became then the champion of “climate change” by spearheading campaign for actions for control of carbon emission and reserving and doling out hundreds of billions of dollars of unproven and non-focused technology or even concept. a. He was trying to interfere in the automatic self balancing system of the nature. The nature knows what it is doing and when should it act or react. The human mortals need not try to control or teach the nature. The nature has experience of over millions of years in self managing its existence. b. He went all the way to Copenhagen in “freezing cold” to talk about “global warming”. Back home in all 4 North Eastern states from Washington DC and New York were


5. 6.



engulfed in 5 to 8 feet deep snow or ice in freezing cold when he was devoting almost half the time of his presidency on global warming. c. Hey, Mr. President, there is snow and ice all around – where is the evidence of global warming? d. In Afghanistan and Iraq his US army was exploding disastrous bombs that were emitting more Carbon dioxide than one small plant in China. Did he end the war with immediate effect e. Osama and Al Qaida were blasting human and real bombs everywhere killing thousand of innocents and causing tons of carbon smokes from the bombing sites. Could he get the cooperation of Bin Laden for carbon emission control? f. In short, he was rushing into “abstract” and “non verifiable” concepts just to divert the attention of the American people. He planned and created hundreds of billions of package called “TARP Trillions” to resurrect the financial system. a. He was trying to kill the wealthy and efficient by chasing them all the way down to UBS, Switzerland by calling for names of 52,000 wealthy Americans who were reported to be tax dodgers. b. He was using hundreds of billions of new money thrown after bad money by lending support to bankrupt Citigroup, AIG, Fannie/Freddie Mae, Bank of America, Wells Fargo, Goldman Sachs, General Electric and host of other bad borrowers. c. In short he was trying to extract billions from efficient wealthy and passing on nearly 100 times more to inefficient banks, brokers and insurers. When he could not create jobs, he invented new slogans – by equaling Saving of Jobs as Creation of New jobs. When he found his plans were no longer working, he invented a new weapon. “Health Care Reform” which at the moment of this writing has almost become a law, spending over $ 1.3 trillions extra. a. Here again, he was showing moon again. He said that 33 millions of Americans would be insured immediately by taxing healthy Americans to pay for health insurance they no longer wanted. b. In short, he was hurting efficient wealth earners and healthy Americans. He did not like “efficiency” in earning income or wealth and building health. c. If you earn more, pay more to the state. If you are healthy, pay the tax or compulsory insurance or pay the fine ranging from $ 750 per person to $ 3000 per family of four. In other words, he became a “blood sucker” draining out the blood or pompous health from the healthy Americans. d. He showed the moon again by showing distant calendar. He said that American people will save $ 1.3 trillions over 10 years. Hey, Mr. President, you are elected to do job to have immediate benefit during your Presidency – that is – for 4 years lasting up to January 2013. Why do you indulge into actions that go beyond 10 years when you will no longer be around? He started chasing fat bonuses to Wall Street bankers which would affect at the most $ 5 to 10 billions. But he embarked upon a journey to guarantee the worthless debt of $ 306 billions of Citigroup. $ 306 billions amount to entire Corporate America’s tax collection for full fiscal year. Was Citigroup as single big entity that important to demand the resources of entire corporate world of America? He was clamoring about the deepest financial crisis over last 70 years. Hello President. Have you seen the Dow Jones index on this Christmas Eve? It is at 10,554. During the 1987 crash, the Dow dropped to less than 3000 which is about 22 years ago. If the financial crisis is of epic proportion, worst in 70 years, how come Dow Jones is still trading at 10,554 ( Up 7554 points or up by 251%?) Does it mean that the Dow is artificially supported at higher

level by printing more and more money and giving to affiliated banks, brokers and funds to support the market by “artificial respiration”? 9. It is evident that President Obama has been using his oratory skills to divert the attention of the American people from core issues. He ignores the hard realities and pushing up the abstract subjects which can not be verified or justified by proper rational. In short, the entire country of United States has gone to the dogs. There are no care takers. The educated Americans have become docile and weakened mass who are loathe to seeing the hard realities. They bother more about tiny Afghanistan than 3 time’s larger states at home. What is Afghanistan? No one heard its name in last 50 years until George Bush went into those rugged mountains to search the rats nicknamed Al Qaida. Afghanistan is a non entity – just piss it off. And get out of it in one week. When Afghans do not care about themselves, why should Americans or other NATO forces do? It is none of their business to be out there anyway. In short the ordinary Americans have been blinded by their loyalty to their political leaders or Presidents, Senators and Congressmen. They are equally superstitious as the mumbo jumbo Africans, religious Muslim populace loyal to white or black robed Mullahs or Ayatollahs or ignorant Hindus in villages loyal to the saffron robed politicians or priests. (This article will be resumed tomorrow to narrate the hard economic and financial part which is a core subject. In the meantime, Merry Christmas. The comments are blocked until the Article is fully published.) Kalidas (Anil Selarka) Hong Kong, 25 Dec, 2009

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