Ford, GM, Chrysler Announce Losses; Can the American Middle Class Survive a Big Three Meltdown?

Can the U.S. economy possibly get any scarier or more complicated?

The short answer is yes, it can. The longer, more complicated answer is that the looming (potential) failures of Ford, GM, and Chrysler present long term sustainability problems for a middle class that is already clamoring for short term, emergency . . . → Read More: Ford, GM, Chrysler Announce Losses; Can the American Middle Class Survive a Big Three Meltdown?

Is the U.S. on the Road to Socialism? (Part 2)

Last week, I looked at the first five planks of Karl Marx’s Communist Manifesto and the extent to which they have been integrated into the U.S. government. This week, I’ll examine planks 6-10.

6. Centralization of the means of communication and transport in the hands of the State.

Check. We have the Federal Aviation . . . → Read More: Is the U.S. on the Road to Socialism? (Part 2)

Will the Student Loan Industry Be Bailed Out Next?

Will companies that issued derivatives based on bundled student loans be the next financial dominoes that will require a government “bailout”? The country’s long dedication to education makes it a virtual certainty.

The emphasis of the role of government in education predates the establishment of the . . . → Read More: Will the Student Loan Industry Be Bailed Out Next?

Thanks VIX, But I Don’t Need Your ‘Fear Index’ to Tell Me People Are Nervous About the Economy

Why, oh why, did the biggest financial crisis since the Great Depression have to hit during a presidential election year?

The ‘Fear Index’, also known as the VIX (or, officially, the Chicago Board Options Exchange Volatility Index) is a financial tool that measures market swings or volatility. The higher the VIX goes, the scarier . . . → Read More: Thanks VIX, But I Don’t Need Your ‘Fear Index’ to Tell Me People Are Nervous About the Economy

Wall Street Bailout: The World’s Largest Sovereign Wealth Fund?

More than 20 countries have set up sovereign wealth funds while a dozen more have expressed interest in establishing them. Many of these sovereign wealth funds are picking up stakes in U.S. companies, which is raising concerns about the need for regulating them. Up until the $700 billion bailout, which effectively is a . . . → Read More: Wall Street Bailout: The World’s Largest Sovereign Wealth Fund?

Financial Bailouts: Is the U.S. on the Road to Socialism? (Part 1)

All nation-states reside somewhere on the continuum between laissez-faire and total-state central planning. No country is completely capitalist and no country (with the possible exception of North Korea) is entirely socialist. So how are we to define roughly “capitalist” and “socialist” countries? Where is the dividing line? How do we know if we are . . . → Read More: Financial Bailouts: Is the U.S. on the Road to Socialism? (Part 1)

Mortgage and Foreclosure Fraud Mushroom in the Wake of Housing Bubble

A recent article splashed across the front page of the mid-size mid-western city where I live tells a surprisingly unfamiliar story about how ordinary people have pocketed hundreds of thousands of dollars by investing in subprime real estate. Though the current financial crisis has brought about intense discussion about the moral hazard of borrowing . . . → Read More: Mortgage and Foreclosure Fraud Mushroom in the Wake of Housing Bubble

Sweden’s Financial Bailout Plan: What the U.S. Can Learn From It

In recent history, governments have nationalized banks when the pressures of internationalized financial markets and international competition have made it difficult for them to control and stabilize their finances and currency. During the last couple of decades, countries as different as Mexico, France, Sweden, and Japan carried out partial or more or less . . . → Read More: Sweden’s Financial Bailout Plan: What the U.S. Can Learn From It

Economists Finally Agree: We’ve Been in a Recession Since January

For at least a year now, ordinary people in the United States (people the press has been referring to as “Main Street”) have known that the economy was starting to slow down at the same time that prices were rising uncomfortably fast.

Now, some economists are finally starting to admit that, yes, the U.S. . . . → Read More: Economists Finally Agree: We’ve Been in a Recession Since January

Bear Stearns Collapse: Why It May Also Be the End for the SEC

The Securities and Exchange Commission (SEC) was set up as a reaction to the stock market crash of 1929 to provide oversight of brokerage firms and protect investors. Last month, Morgan Stanley and Goldman Sachs Group, Inc., filed to become bank holding companies. Now with the sale of Bear Stearns, the bankruptcy of Lehman . . . → Read More: Bear Stearns Collapse: Why It May Also Be the End for the SEC