Once More Into The Fray

Turns out the Nikkei is closed, but US markets are open tomorrow. Early news from Australia is that we're indeed seeing a bear market rally and bargain hunting to an extent. Dow futures are up around 3%.

But the remaining problems are still very much present. I seriously doubt we've hit bottom yet. Third quarter earnings are going to come in and really knock the steam out of things. There's a lot that will continue to go wrong before it goes right, and any other kind of shock right now, another round of near failures in banks for instance, might be enough to do us in.

All the problems we had three months ago are still there. Some measures are in place, and there may yet be some short-term recovery.

But I'm still betting on bad numbers in the future. This problem will keep unwinding and we're now all but out of options to deal with the next problem: massive inflation. Cleaning that up will take a long, long time. We're in for years of pain, not months.

How Bad Could This Get?

There's a still a lot of space between where we are now and a long-term outlook of a global depression. Not a much as even last week, but there's still a way out. But in the medium term things could get very, very bad.

Economists are beginning to warn of a depression-like cycle where an inability to obtain credit stalls growth, triggering more defaults and still tighter lending terms. Governments have unveiled one unprecedented move after another in the past three weeks to boost confidence and get banks back in business, yet so far nothing has been able to arrest the fall.

"There's no hyperbole that can describe it," said Kenneth Rogoff, a Harvard University professor and former chief economist of the International Monetary Fund. "It's very, very unlikely (that the world economy will fall into a depression) but we've taken five of the 10 steps we need to get there. Hopefully we won't take the other five."

I'd argue it's more like step 7 or 8, frankly. We're deep in a spiral and the means of getting out will require far more action than has been taken even with today's EU announcements.

"With no desire to exaggerate, this might be considered the financial pre-conditions of a depression," Citigroup economist Steven Wieting wrote in a note to clients.

"Evidence suggests credit rationing is inhibiting day-to-day activities for many firms, with a harsh and worsening backdrop for consumers," he said. "Sadly, some risk exists that financial events could still unfold like a proverbial 'dam break.' This might leave policy-makers treating very serious and lasting damage to the financial system, rather than preventing further erosion."

Already, the crisis has taken a heavy toll on economic prospects. Wieting now expects nominal U.S. economic growth next year will be the weakest since 1954, with unemployment climbing to 8.5 percent from the current 6.1 percent.

And I honestly believe those numbers are far too tame. 2009 is going to be a miserable year. Remember, the same people who didn't believe the housing bubble would burst, that the banks would tumble, that Fannie and Freddie were toast, or that the credit crisis would worsen are the same people that believe 2009 is going to be the start of a massive rally in stocks.

The Dow had its worst week in both point and percentage terms and is down 40.3 percent since reaching a record high close of 14,164.53 on Oct. 9, 2007. In the last eight trading days alone, the blue chip index has lost a staggering 22.1 percent of its value.

Added up, the value of U.S. stocks has tumbled a breathtaking $8.4 trillion in the past year, as measured by the Dow Jones Wilshire 5000 index.

“These are all indicators of a bottoming process,” said David Kotok, said chairman and chief investment officer of Cumberland Advisors. “When you see this array of signs at these levels, three to six months later there was a rally under way. I am becoming very bullish strategically because I don’t think we’re going to have an inflationary Great Depression repeat.”

Keep telling yourself stocks can't go any lower, guys. Keep telling yourself this is another mild recession like 2002. Keep telling yourself this isn't a generation-defining event. Keep telling yourself capitulation selling will solve all the economy's problems.

Keep telling yourself that Dow 14,000 is just a couple of months away again if we just all clap our hands and just believe hard enough...

McSame's New Stunt Of The Week Is:

...Guess. If you said "A new shiny wrapper for his existing corporate tax cut Ponzi scheme" then you win.

Republican presidential candidate John McCain is considering rolling out a new comprehensive economic package to tackle the U.S. financial crisis, one of his closest supporters said on Sunday.

"I think it goes along the lines that now is the time to lower tax rates for investors, capital gains tax, dividend tax rates, to make sure that we can get the economy jump-started," said Republican Sen. Lindsey Graham of South Carolina.

Yes, because I know my largest problem right now as a taxpayer is capital gains on my investment portfolio. Also, I'm equally sure the only reason the Dow is plummeting is because the capital gains taxes are too high. We're all just getting crushed by capital gains taxes right now from our investments.

This plan will help out Aunt Sandy at Wal-Mart, surely.

Another Vital Step As The Clock Winds Down

While an agreement with the G7 nations to stop the banking crisis has largely failed, the EU has at least vowed to go down swinging with another necessary tactic: a five-year guarantee on interbank lending in the Eurozone.

The declaration says the governments would guarantee "for an interim period and on appropriate commercial terms" new debt issued by banks for up to five years.

"This scheme would be limited in amount, temporary and will be applied under close scrutiny of financial authorities until Dec. 31, 2009," it says.

The leaders of the 15 euro-zone nations held an emergency summit Sunday night in Paris to seek European solutions to the financial crisis engulfing markets worldwide. The meltdown dominated summits around the world this weekend.

The statement also says that one way governments could save banks would include buying big stakes.

Whatever is decided Sunday will then be proposed to the full 27-member European Union at a summit later this week.

British Prime Minister Gordon Brown, who met with France's President Nicolas Sarkozy before the euro summit, said the plan "would involve not only more cash in the financial market but also a recapitalization of our banking system.

"And allied to that -- something that I believe is absolutely crucial -- to begin again the funding of businesses and mortgages with a guarantee given by governments. That can happen and will happen in the next few months," he told reporters.

Again, it's a start. Combined with the nationalization plans of the UK, at least the Euros are taking concrete action. But it should have been done months ago. And without the cooperation in this interbank lending plan from the US and Japan, it most likely is too little, too late. There's little point in guaranteeing bank lending if the banks most likely to fail -- US banks -- are left out in the cold.

There's also the nasty problem of a week before the full EU will vote on the measure. Another week could knock another 20% off world markets...and should the measure not pass, it will be catastrophic. We'll see how it goes in a few hours.

Europe it seems is battening down the hatches in the middle of the perfect storm. Call it prudence, neccessity, or protectionism, most likely it will not be enough to stop the worst of the damage.

It's Not Violence If You're The One With The Gun

Bard at Sadly, No! brings up an excellent point:

It’s quite amazing to watch the same people who pushed for concentration camps, hanging courts and genocide during the Bush years to now talk about taking up arms against the tyrannical and violent government that Barack Obama is about to unleash. There are many words one could use to describe this mentality, but I think calling them “crazy assholes” will suffice.

Bush Derangement Syndrome has nothing on the calls to kill the Muslim traitor terrorist Barry Hussein Obama.

Do any of you honestly think they will stop out of respect for the office of President?

Eight Hours And Counting

Before Asian markets open for Monday trading. Still no coordinated world action on markets, the US and Australia have gone their own way along with the UK with various different plans (all short on most details) and now the rest of Europe is trying to catch up by putting something in the hopper before the clock runs out.

European leaders met to forge a new set of measures to combat the credit freeze after their failure to act a week ago contributed to the worst sell-off in the region's stocks in two decades.

``I want Europe to speak with one voice for Europe and for the world because this is a global crisis,'' French President Nicolas Sarkozy told reporters as he greeted European Commission President Jose Manuel Barroso at the Elysee Palace in Paris. Sarkozy said he's seeking ``an ambitious, coordinated plan.''

German Chancellor Angela Merkel, whose government earlier this month rejected French suggestions to form a joint bank- rescue fund, said yesterday the euro region will implement ``the same toolbox of instruments.'' Merkel, Sarkozy and their counterparts in the 15-nation euro region are being forced to shift stance as a deepening slide in financial markets has threatened to tip Europe into a prolonged recession.

``Measures by euro-area governments to end the financial crisis have been uncoordinated and insufficient,'' said Juergen Michels, a Citigroup Inc. economist in London. ``Increasing risks of an economic disaster might force governments to set up more coordinated and more comprehensive measures.''

U.K. Prime Minister Gordon Brown met Sarkozy, Barroso and European Central Bank President Jean-Claude Trichet. The leaders of the euro nations then gathered at 5 p.m. local time. The talks come after finance chiefs from the Group of Seven nations established guidelines on Oct. 10 for combating the credit crunch, while falling short of adopting new initiatives.

The odds of something happening in time for tomorrow are almost nil. It will be another punishing week for world markets.

If a 20-25% market drop across multiple global markets one week isn't enough to motivate a concentrated, focused, and coordinated response from the G7, what will it take to do the trick? If we lose another 25% this week, will this type of massive global multi-trillion dollar response even be enough?

We've gone from 14,000+ on the Dow to 8,200 in the space of a year, with 2,000 points of that loss coming in just one week...and still the world is fiddlefarting around.

Dow 6,000, here we come?

The Damage Control Begins

With 22 days left until the election, not even the right wing numbers nerds at Real Clear Politics can see a way out for McSame at this point. This week's GOP plan, which is apparently "ludicrous happy talk of divided government through Republican control of Congress" is already being laughed off the stage by the right.

Jonathan Martin catches a new message perhaps emerging from McCain circles: The benefits of divided government.

Appearing on Fox News Sunday, campaign manager Rick Davis said:

Do we really believe that the American public is going to feel safe by having both the head of the Congress and the head of the White House from the same party that has had so many challenges with the way they've run Washington over the last couple of years?

Appearing next, Gov. Tim Pawlenty sounded the same theme:

"I don't think the country is going to like the Democratic party running the table on taxes, on education, on health care and have kind of the liberal, unchecked, imbalanced approach to all of those issues," Pawlenty said. "It's going to be bad for the country. I think having John McCain as president to balance that out and be able to work across the aisle as he has throughout his career to get things done would be a good compromise, a good balance."

If coordinated, as Martin says these comments "almost certainly" are, then we can probably expect an ad in the not-too-distant-future featuring prominently Nancy Pelosi and Harry Reid as the faces of an Obama administration. It could have an impact, since Congress' approval ratings are also in the tank, except that Dems hold a 10-point advantage in the generic Congressional vote and no one thinks they won't pick up seats in both chambers.

The Democratic landslide is coming, folks. We'll need all the help we can get in 2009. Certainly the GOP will try to put up the divided government argument once again in 2010 and argue that Obama is responsible for everything, and that the Democrats have to go.

I don't think it will work then, either.

Cramer And Kudlow Are Forgiven

Because the CNBC hosts are stable and thoughtful compared to the network's resident Village Idiot, Jerry Bowyer. Here's a guy who believes the causes of the financial meltdown are the minimum wage hike, Eliot Spitzer, Chuck Schumer, any and all market regulation in the last 80 years, Chris Cox, the media coverage of Sarah Palin, and my personal favorite, "affirmative action mortgages."

If you think any of these caused the financial crisis, please feel free to drink the NY Times Kool-Aid (ladies and gentlemen, your liberal, socialist media) and invest heavily on Monday: after all we haven't had a depression in decades!

Now investors have again convinced themselves that this time is different, that the credit crisis will push economies worldwide into the deepest recession since the Depression. Fear runs even deeper today than greed did a decade ago.

But in their panic, investors are ignoring 60 years of history. Since the Depression, governments have become far more aggressive about intervening when credit markets seize up or economies struggle. And those interventions have generally succeeded. The recessions since World War II, while hardly easy, have been far less painful than the Depression.

Now some veteran investors, including G. Kenneth Heebner, a mutual fund manager who has one of the best long-term track records on Wall Street, say that the sell-off has gone much too far and stocks are poised to rally powerfully if the downturn is less severe than investors fear.

Sure. It won't be so bad! It's not even going to be a mild recession, I mean 6.1% unemployment? Hey, stocks are undervalued! When this pesky credit crisis vanishes, we'll come roaring back to Dow 14,000 and you're going to miss out! BUY BUY BUY BUY BUY!

What have you got to lose? Stock prices and home values always go up!

Australia Leads The Way

The Aussies seem to know what's at stake here. They are issuing a blanket guarantee for all bank deposits for the next three years.

The government will also guarantee all term wholesale funding by Australian banks operating in international markets and it will inject $4 billion (U.S. $2.6 billion) into residential-backed securities to help shore up the Australian mortgage market.

Compared with the United States, Australia has handed out few sub-prime mortgages, according to CNN affiliate Seven News Sydney.

Banks are heavily regulated and the country has financially benefitted in recent years from China's demand for its mineral resources, Simon Robson of Seven News told CNN.

Australia is in much better financial shape than we are here in the US, and its guarantees on deposits and wholesale funding that will help to restore confidence.

The US needs to do the same thing immediately. Raising the FDIC insurance limit to $250,000 for 15 months isn't going to work, a good 30% or more of deposits will not be covered by this. It's these long-term illiquid deposits like CDs held by older folks and small businesses that are vulnerable right now. These assets are going to eventually be moved to places where there IS full blanket protection.

In fact, all the G7 countries should offer this as of today. Those who do will be in much better shape. Those who do not will be in serious trouble as capital flows out of those countries.

The Republicans Have No Idea How To Handle McSame

They do know he is going to lose. They don't know how to help him, because there is simply no getting past the fact that Americans blame the GOP for the economy, and John McSame is the GOP candidate.

Again and again, party leaders said in interviews that while they still believed that Mr. McCain could win over voters in the next 30 days, they were concerned that he and his advisers seemed to be adrift in dealing with an extraordinarily challenging political battleground and a crisis on Wall Street.

The expressions of concern came after a particularly difficult week for Mr. McCain. On Friday night, new questions arose about his choice of Ms. Palin as his running mate after an investigation by the Alaska Legislature concluded that she had abused her power in trying to orchestrate the firing of her former brother-in-law, a state trooper.

“I think you’re seeing a turning point,” said Saul Anuzis, the Republican chairman in Michigan, where Mr. McCain has decided to stop campaigning. “You’re starting to feel real frustration because we are running out of time. Our message, the campaign’s message, isn’t connecting.”

30 day thing aside when there's 23 days left, the problem is the GOP just doesn't understand why the Rovian tactics aren't working. They really don't see why any thinking American would vote Democratic this year, much less for a black man. They don't understand because comprehension is simply beyond their grasp. You and I know that any "message" the GOP is trying to get across is drowned out by the 800-pound gorilla in the room with the airhorn and the neon sign that reads "THE BUSH REPUBLICANS CREATED THIS FINANCIAL MELTDOWN!" They honestly believe that since the media and America has given the Bush Republicans a pass on every other cock-up they've rammed down out throats, that this one should be no different.

Only it turns out this one is the last straw, because it's going to put millions of us out of work with no way to feed our kids. And that's making people stop and think about who should be in charge this year. The answer they are arriving at is "not John McSame."

But no subject has more divided Republicans than the one that has been a matter of disagreement in the McCain camp: how directly to invoke Mr. Obama’s connection to his controversial former minister, the Rev. Jeremiah A. Wright Jr., and William Ayers, a former member of the Weather Underground who has had a passing association with Mr. Obama over the years.

In Colorado, a traditionally Republican state that Mr. McCain is struggling to keep in his column, the party chairman, Dick Wadhams, urged Mr. McCain to hit the issue hard, arguing that it was fair game and could be highly effective in raising questions about Mr. Obama in the final weeks of the campaign. He said he was surprised Mr. McCain had failed to do so in the debate last week.

“I think those are legitimate insights into who Senator Obama is,” Mr. Wadhams said. “I do not think it is irrelevant to this election.”

But Fergus Cullen, the Republican chairman in New Hampshire, said Saturday that he thought it would be a mistake for Mr. McCain to go down that road, warning that it would turn off moderate voters in his state who have a history of supporting Mr. McCain.

“I don’t think he should be giving into elements of the base who have been asking him to be going after, using Wright, using Ayers,” Mr. Cullen said. “Think about it as an undecided persuadable voter.”

Who the fuck cares about Jeremiah Wright AT ALL when you just lost your job, your health insurance, your pension, or your 401(k)? Who cares about Tony Rezko or the color of Obama's skin when you don't know if you can feed your kids or make your mortgage payment or car payment or credit card payment this month because you've been letting them slide and the collectors are calling daily?

Look folks, when people are losing trillions of dollars, their life savings, are going into indentured servitude and are watching AIG executives get spa treatments on the taxpayer dime, and your CHIEF CONCERN about yout party's candidate for President is "how negative John McSame should be when attacking on the Wright/Ayers angle" your party deserves to lose every election it's in.

The people are going to bury the Politics of Stupid for good. The GOP has nothing now. Nothing. Absolutely nothing. This mass repudiation will put them in the wilderness for years. John McSame will go down as the GOP's McGovern.

If we come out of this with a country instead of a live-action version of Jericho then we're ahead of the game as far as I'm concerned. The Democrats are still infinitely preferable to the GOP.

Forget Universal Health Care

...it's not going to happen. It will be all the next President can do just to keep basic order and combat a breakdown in services like food, water, and power. The bailout's impacts are immediate and devastating on our economy with news that the 2009 fiscal deficit could be upwards of two trillion dollars.

The global financial crisis is turning into a bigger drain on the U.S. federal budget than experts estimated two weeks ago, ballooning the deficit toward $2 trillion.

Bailouts of American International Group, Fannie Mae and Freddie Mac likely will be more expensive than expected. States are turning to Washington for fiscal help. The Federal Reserve said this week it will begin buying commercial paper, the short- term loans companies used to conduct day-to-day business, further increasing costs. And analysts now say the $700 billion bank- rescue plan passed by Congress last week may have to be significantly larger.

``I always assumed they would be asking for more money along the way if it was necessary, and it looks like it's going to be necessary,'' said Stan Collender, a former analyst for the House and Senate budget committees, now at Qorvis Communications in Washington. ``At the moment, there's nothing happening here that's positive for the budget. Nothing.''

The 2009 budget deficit could be close to $2 trillion, or 12.5 percent of gross domestic product, more than twice the record of 6 percent set in 1983, according to David Greenlaw, Morgan Stanley's chief economist. Two weeks ago, budget analysts said the measures might push deficit to as much as $1.5 trillion.

Forget about Obama's spending proposals, including his tax cuts on the middle class...not going to happen. None of it.

We'll be lucky to survive the riots, shortages, and mass unemployment ahead.

One Person's Pro-Choice Position

...is another person's radical insanity, or so the story goes.

Sarah Palin would have you believe that her position on abortion -- "I am pro-life. With the exception of a doctor's determination that the mother's life would end if the pregnancy continued," is the mainstream position on the topic, and Obama's position -- that he will "will make safeguarding women's rights under Roe v. Wade a priority" is just too radical for America.

Alaska Gov. Sarah Palin charged into the culture wars Saturday in Pennsylvania, painting Sen. Barack Obama as a radical on abortion rights.

The stop comes amid news that Palin violated Alaska ethics law by trying to get her former brother-in-law fired from the state police, a state investigator's report for the bipartisan Legislative Council concluded Friday.

Ethics woes aside, Palin focused her attention on abortion -- an issue that rallies the conservative base but some say alienates independent and women voters.

"In times like these with wars and financial crisis, I know that it may be easy to forget even as deep and abiding a concern as the right to life, and it seems that our opponent kind of hopes you will forget that," Palin told a crowd in Johnstown. "He hopes that you won't notice how radical, absolutely radical his idea is on this, and his record is, until it's too late."

It's amazing. The Sarah Palin position on abortion, one shared by plenty of folks in the GOP, is that new Supreme Court justices with specific views on this issue as a political agenda must be installed, that Roe v. Wade must be overturned by these justices, and that state legislatures must then be given the ability allow an up or down vote on banning all abortion procedures under the cover that Roe v. Wade is in fact the denial of the the American people's right to vote in legislators at the state level who will work to pass such legislation, or to vote on such legislation directly in referendums.

So you see, being pro-life in this case with the stated goal of having state legislators and millions of other people decide what is best for a woman's body is actually being pro-choice, because these folks believe that an entire populace has the right to make these choices for you, and Roe v. Wade's pesky "Constitutional right to privacy" argument is keeping American voters and state legislatures from being able to mandate personal decisions involving your body.

Why stop at abortion? If you remove the tenets of Roe v. Wade's arguments, that a voting populace's rights to decide on social mores involving reproduction is more important than the individual's right to make their own decisions on the topic, then you have to apply that logic to allowing the people to vote on birth control, pre-marital sex, in-vitro fertilization and fertility clinic procedures, and even the legality of sex itself as something that has to be voted on.

You see, if Roe v. Wade's arguments are thrown out, if there is no Constitutional right to individual privacy, then the voters and the State then have the right to make a person's life decisions for them, anything less is denial of the voter's rights to express their beliefs in enforcing the moral codes that they wish to see their society have.

Forget the "slippery slope" argument, this is the "Palin's cliff" argument. You are a ward of the state, plain and simple, and these people believe that whether or not you can do anything as a private individual should be determined solely by a vote of the people, anything less is to deny the people the right to vote on your effects on society.

Why stop at the legality of sex at all? Why not allow the people to vote directly on or vote in people who wish to legislate anything that could be a social taboo: homosexuality, religion, interracial marriage, the ethnic composition of neighborhoods, what languages you are allowed to speak, who you can associate with, who is a citizen...the list goes on and on.

But that position is not "radical." No, Senator Obama's position that an individual has rights in our society is "too radical" for America according to Sarah Palin.

Think about that. This is the kind of decision Sarah Palin would make for you as President. After all, you voted her into the office. She therefore believes she has a mandate to make the decision to allow people to make the decisions for you...people like Sarah Palin. Morality must be voted upon and legislated.

She's the ultimate pro-choicer, you see.

Cross-posted at the Frog Pond.

The Price Of Failure

The G7 meeting this weekend has been a complete bust. Germany and France are scrambling to save themselves, and the IMF is now publicly warning of global systemic meltdown.

The IMF warned on Saturday that the global financial system was on the brink of meltdown, while France and Germany pushed ahead with a pan-European crisis response to try to prevent the worst global downturn in decades.

At a joint news conference, French President Nicolas Sarkozy and German Chancellor Angela Merkel said they had "prepared a certain number of decisions" to present at a Sunday meeting of European leaders as they work feverishly to restore blocked credit markets to working order.

The United States appealed for patience, but the International Monetary Fund stressed that time was running short after leading industrialized nations failed to agree on concrete measures to end the crisis at a meeting on Friday.

"Intensifying solvency concerns about a number of the largest U.S.-based and European financial institutions have pushed the global financial system to the brink of systemic meltdown," IMF chief Dominique Strauss-Kahn said.

It's the last hurrah and the world is burning.

I expect by the time the G7 decides to act in concert after another 20% loss worldwide in stocks, maybe something will happen that will prompt the kind of international action needed. It won't matter much by then I'm thinking, but hey. I'm sure it'll be okay, right?

Delusions Of Only Being Moderately Horrible

You really do have to admire the sheer ability of Preznitman to deny reality to the point where he honestly believes he did us a favor these last eight years.

George W. Bush began his presidency with the worst terrorist attack on American soil and he is ending it with the worst financial crisis since the Great Depression. In between, he confronted a hurricane that nearly wiped New Orleans off the map as his administration showed ineptitude in its response.

Now, as he spends his last months in office trying to avert a global economic collapse, Mr. Bush has been telling people privately that it’s a good thing he’s in charge.

Are you shittin' me? This man is the worst President in the history of the country, and he's actually believing we're grateful for the last eight years to him.

“He said that if it was going to happen at all, he was glad it was happening under his presidency, because he had a good group of people in D.C. working for him,” Dru Van Steenberg, one of several small-business owners who met with Mr. Bush in San Antonio earlier this week. The president expressed the same sentiment, others said, during a similar private session in Chantilly, Va., the next day.

“He said that whoever was going to take over in January was going to have a huge crisis on their hands the day they come into office,” Ms. Van Steenberg added. “He thought by this happening now, that perhaps everyone could see signs of improvement before the next president comes into office.”

Insanity. Pure insanity. Bush really does believe history will see him as some sort of saint with a dirty halo, a man who led the country through the "rough shoals of fate" ala Gerald Ford or something, and that he will be absolved by historians decades from now as a visionary or great unifying statesman.

Our President is an insane lunatic suffering from nearly sociopathic levels of delusion. His complete lack of leadership and his blatant refusal to act on some of American history's most turbulent events has directly contributed to the state we're in right now: facing a global catastrophe.

He will be reviled by a generation who will teach their own children to revile him as well. He deserves no less. He should actually appear on the currency of this country in the future with the caption "Never Again."

Never Again. Two words that we must all take to heart now, for it is truly too late. Our standard of living will drop precipitously soon. With clear eyes, sharp mind, and a heavy heart, we must find a way out together now.

I fear it will be a brutally long journey.

George W. Hoover

Preznitman spoke this morning from the Rose Garden, flanked by the G-7 finance ministers. His statement? "We'll fix this! You can count on us!"

President Bush on Saturday once again tried to reassure a nervous public that world leaders were working together to address what is unfolding as the worst global financial crisis since the Great Depression.

"We recognize that the turmoil in the financial markets is affecting all our citizens," Bush said, standing in front of financial ministers from the world's top economies gathering in the nation's capital. "All of us recognize this is a serious global crisis that requires a serious global response for the good of our people."

The president did not announce any new actions to stem the financial panic gripping the world, but reiterated measures world leaders are taking to strengthen financial systems.

Those measures will not take effect in time, and by the time they do take effect, they will be too late to do any good. The newest pointless rule proposal by the SEC? A three day ban on a short selling for any stock that drops by 20% in a day. That's like passing a leaf burning ban ordinance two weeks after a wildfire has burned down city hall.

All signs are pointing straight down. Even Jim "Mad Money" Cramer is talking about the honest preparations for 1929 all over again. Six weeks ago of course Cramer said that the "rally is real" and that the WSJ's crazy article that said stock markets wouldn't recover until next year was "totally overblown" negativity. Now, Cramer is actually right about the same percentage of the time as a broken grandfather clock is at telling the time, but the damage is still done and more damage is coming as a result: the systemic, structural basis of the global economy is collapsing.

Idiots. All of them. I've been warning about this for nine months now. People a lot better at this then I am have been warning about this for several years now and some before that have been warning us since 2000 or so that our economy was untenable. Before Roubini there was Libertarian economist Gary North, who said this in 2002:

This is the threat the world faces today. Central banks are in control of money. They have addicted the whole world to massive debt, ever more complex. Any slowdown in the inflation of the money supply threatens the solvency of the entire economy. Ludwig von Mises warned against this ninety years ago, in his Theory of Money and Credit (1912). He warned that the government's refusal to call a halt to monetary inflation – its return to credit-money creation – would eventually destroy the currency. He called this the crack-up boom. In the meantime, we would get endless boom-bust cycles, he said. So we have.

Let me repeat the journalist's warning about buying shares of bankrupt firms: "Gambling involves much hope, little thought and leaves you with the irrepressible urge to repeat your mistakes." But what happens when bad accounting practices, complex debt, and endless monetary expansion persuade investors to buy what are in effect bankrupt companies – companies that are kept afloat only by new injections of bank credit money? The central bankers dare not stop the flow of money. And so the leverage game goes on and on. We are riding the tiger, a tiger of endless debt and capitalized future income streams: derivatives.

And as Gary North pointed out, Austrian Economist Ludwig von Mises warned the world of the problems of central banks and debt long before the Great Depression. He was ignored then. He was ignored for a very long time by most folks.

I honestly thought somebody was going to heed those warnings that had the power to DO something about it. Me, I just made the choice to not get a credit card...still the best choice I made in my life so far.

But it's all coming down around us now. The warnings were not heeded. The perfect storm of willful ignorance, greed, neglect, deregulation, credit addiction and global scale has turned this month into the end of an era.

George W. Hoover, the worst Preznitman the world has ever seen.