[Eli]

The financial system of the US is done, it is over.

The Treasury just bailed out the Fed in an emergency auction. The Fed is broke.

The FDIC has 50 billion to its name, and thousands of US Banks are on the brink of failure.

The money in your checking account and savings is not covered.

For the Treasury to back up the FDIC it would require more money creation, and no one wants US debt.

[IanC]

I for one want to welcome my new ant overlords.

Seriously, where did you get this info? What about credit unions?

-Ian

[cipi604]

More information please.

[Eli]

$this->bbcode_second_pass_quote('', 'B')ut Americans are justified to be worried, says Nouriel Roubini, of NYU's Stern School and RGE Monitor, who notes there is already a "slow-motion run on retail banks" occurring nationwide.

That "run" could accelerate as people realize the FDIC fund has about $50 billion to "insure" about $1 trillion in assets at the nation's financial institutions, says Roubini. "They're going to run out of money" unless Congress acts soon to recapitalize the FDIC.

[burtonridr]

$this->bbcode_second_pass_quote('IanC', 'I') for one want to welcome my new ant overlords.

Seriously, where did you get this info? What about credit unions?

-Ian

[MrMonkey]

$this->bbcode_second_pass_quote('Eli', 'T')he financial system of the US is done, it is over.

The Treasury just bailed out the Fed in an emergency auction. The Fed is broke.

The FDIC has 50 billion to its name, and thousands of US Banks are on the brink of failure.

The money in your checking account and savings is not covered.

For the Treasury to back up the FDIC it would require more money creation, and no one wants US debt.

[burtonridr]

$this->bbcode_second_pass_quote('MrMonkey', '')$this->bbcode_second_pass_quote('Eli', 'T')he financial system of the US is done, it is over.

The Treasury just bailed out the Fed in an emergency auction. The Fed is broke.

The FDIC has 50 billion to its name, and thousands of US Banks are on the brink of failure.

The money in your checking account and savings is not covered.

For the Treasury to back up the FDIC it would require more money creation, and no one wants US debt.

[sittinguy]

How can the Fed be broke? They have the press to make all they want?

[heroineworshipper]

Well, China is now more capitalist than US.

[burtonridr]

$this->bbcode_second_pass_quote('sittinguy', 'H')ow can the Fed be broke? They have the press to make all they want?

[POAlex]

It certainly is a mess.

Alex

[Daniel_Plainview]

$this->bbcode_second_pass_quote('heroineworshipper', 'W')ell, China is now more capitalist than US.

[Eli]

Fed asked the Treasury to bail it out.
If the Fed wasn't broke why did they ask the Treasury for more notes?


The Fed gets Treasury notes from the Treasury and makes loans against them. They ran out of notes from which to lend.

We are now at the point where the Treasury will have to issue new notes to cover the FDIC, and foreign Central bank investors are already running from taking on further US debt as the risk of default has increased.


Or Congress will have to step in and fund the FDIC with taxpayer money.

But this makes no sense what so ever, the Congress gets money through taxation. This will be the worst of taking from Peter to pay Paul.

[idiom]

Well, The USSA could annex Canada and make loans against that.

[Dreamtwister]

$this->bbcode_second_pass_quote('idiom', 'W')ell, The USSA could annex Canada and make loans against that.

[firestarter]

$this->bbcode_second_pass_quote('Eli', '[')url=http://www.washingtonpost.com/wp-dyn/content/article/2008/09/17/AR2008091701403.html]Fed asked the Treasury to bail it out.[/url]
If the Fed wasn't broke why did they ask the Treasury for more notes?


The Fed gets Treasury notes from the Treasury and makes loans against them. They ran out of notes from which to lend.

We are now at the point where the Treasury will have to issue new notes to cover the FDIC, and foreign Central bank investors are already running from taking on further US debt as the risk of default has increased.


Or Congress will have to step in and fund the FDIC with taxpayer money.

But this makes no sense what so ever, the Congress gets money through taxation. This will be the worst of taking from Peter to pay Paul.

[dohboi]

The sham that capitalism has always been is coming undone as we watch in stupified horror. What is not and probably never will be reported in all of this is the role of PO in any of this. The house of cards of corrupt money deals could have gone on quite a while if more real capital--ever cheaper energy from oil--was still flowing into the system. But the shrinking availability of this most basic of assets makes it hard to play those funny-money games.

Can we stop pretending to be a capitalist country now? I never want to hear the conservatives of any stripe talk about the magic of the market or the virtues of rugged risk takers. It's all a sham and always has been. Those conservatives are and have been either knowingly complicit in this fiasco or what can only be called criminally naive.

/rant

So what's the next move? Obviously there will be shock-doctrine moves to gut all social programs. But will Bush use this as an excuse to impose marshal law?

We are a society bankrupt in just about every way imaginable. (Sorry, I guess rant is back on )

[americandream]

$this->bbcode_second_pass_quote('heroineworshipper', 'W')ell, China is now more capitalist than US.

[heroineworshipper]

For the first time in 200 years, economic productivity seems to depend on population size. It's no longer possible at $100/barrel for oil to multiply the productivity of the few. For every $2 you make by being 5 places simultaneously, you have to spend $4 for gas.

[smallpoxgirl]

Yeah. The fed isn't supposed to be Santa Claus. It's supposed to be a lending agency. I don't think it should come as a big surprise that the price of Christmas in September is that they have to print their way out of the hole. For a long time it's been really obvious that when this thing hit, the outcome would be hyperinflation. As long as it's inflation not stagflation, I'm all for it. I've got a lot of student loans at 4% fixed APR. 15% inflation would be great for me.