Busted: Bankers and The Global Economy

November 9, 2008

American Job Crisis Solution

cash needed, not corporate bailoutsEver since job losses followed by consumer consumption hit the red zone 10 months ago, the American job crisis has worsened. What gets the most attention is still retail sales, the prospect of Big Business and consumer consumption. Every measure of economic growth is measured on that consumption. In that light, there is little hope for quick results beyond drawing unemployment unless you are willing to look for small business opportunities.

Big Business is awash in crisis amid sagging numbers. Instead of focusing on lazy investors with big pocketbooks looking for investments, consider the small businessman rising to the challenge to spark innovation and a stronger economy. Investors should look at investing in themselves for their growth.

Look to spend what hard-earned dollars you have with small business, even on the internet to support the small business that builds your economy and families like yours. Vote your confidence with your wallet. Big Business is or will be sucking down huge volumes dollars in the hopes of bailing out millions of jobs in the next few months, mostly in the auto industry for cars that nobody wants. What will done with all those cars? Hopefully, they will either sell them at fire sale prices for impoverished Americans that need them, but can’t afford them or they will resell them as next year’s model. American automakers can’t afford to be choosy with taxpayer dollars. Big business needs to be giving back in spades for taxpayer bailout money received. Forget the meager interest payments Americans will never see. The American citizens need a real boost, especially among the harder hit elderly and lower to middle income. Americans need solutions, not corporate bailouts for stupid decision-making. ~ E. Manning

July 26, 2008

EU Wants Tighter Controls on Securitized Loans

The European Union has looked long and hard at the mortgage debacle in the United States and is planning to take regulatory action at home. Bankers have proved that they cannot be entirely trusted where profits and internal banking instruments are concerned. The European Commission is on top of the matter to avoid a management crisis by EU banking bodies. Naturally, bankers are concerned with their profit margins more than safety or the possibility of fraud.

The EU wants to allow banks to buy so-called securitized loans, loans repackaged as securities, if the selling institution holds back 10 percent in reserves, says a European Union Commission draft for new banking rules. The intent is to implement the rules in the autumn. EU governments and the European Parliament have not approved the plan.

The plan has alarmed the financial industry. The industry claims that the ruling could restrict lending in Europe by driving up the price of loans for companies, home buyers and consumers. Banks think that Europe’s banking and financial market is at risk of becoming overregulated. Clearly, the EU knows that commercial bankers have their brains in their wallets.

Banks are also worried about EU plans to limit the size of loans for interbank lending. The draft plan requires banks to commit no more than a quarter of equity capital for interbank loans. Bankers fear that such a move would lead to new liquidity shortages in interbank dealings.

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