Bush and the Rapture.

I found an illustration of the last seconds on Earth prior to the Rapture, at the site Democratic Underground. It depicts Bush with a whole bunch o' Christians on a hillside awaiting the rapture that is just about to happen. Below, World War III rages. Of course, it's just LIKE Bush to disappear whenever disasters and catastrophes happen. Remamber 9/11? Remember Katrina? Remember when the economic meltdown first reached critical mass last September and Paulson -- not Bush -- sent a page-and-a-half piece of proposed legislation to Congress?


Well, here is the Rapture!

Behold, Ourobouros!

Sheila Bair announded the other day that the FDIC may borrow from the banks in order to meet its Deposit Insurance payout obligations that are expected to come down the pike. (No, not the Mass. Pike.) ;-)

Zero Hedge

Even as the FDIC is scrambling to find ways to replenish the practically empty Deposit Insurance Fund, one of its options, namely borrowing from the Treasury, may be a non-starter due to the eggregious monetization by its counterparty, the Federal Reserve, as both run up against the Federal debt ceiling. According
to Bloomberg:

"Any new government borrowing brings the outstanding U.S. government debt closer to the $12.1 trillion limit. Tapping the FDIC’s line of credit or borrowing through the Federal Financing Bank or from private banks also would have implications for the debt limit, Treasury spokesman Andrew Williams said in an interview."

More from Bloomberg:

The FDIC board is set to meet next week to decide how to refill funds
depleted by 94 bank failures this year. The options include new assessments on
banks, tapping a $100 billion line of credit with the Treasury Department, or borrowing money from banks or debt markets.

People, I can't begin to tell you how seriously whacked this is! The FDIC borrows from banks to fulfill its deposit insurance obligations and they'll repay the banks by assessing... the same banks! The FDIC and the banking "system" would become like Ourobouros, eating its own tail!

And suppose there's a bank run, like on Citigroup, or on Bank of America? Then all the big banks are in danger of collapsing! And who would be paying out to make the depositors whole to a certain degree? Why, the FDIC!!! And where would the FDIC get the money to bail out the depositors at these banks? Why the big banks themselves!!!!! O -- Ourobouros will be munching way, way up its tail! Once it reaches its own anus... well, you know what'll happen next.

Next to Neda's Murder, Most Appalling.

A 17-year old boy from the fine city of Tehran, who had less than a month to take entrance exam into university, had his fingers broken and the webs between his fingers slit by fascist thugs representing themselves as "security forces," most of whom didn't even speak Farsi.

And he hadn't even formed an opinion on the recent stolen election over there.

Link

Not Often I Like What Neo-Cons Do

But today, the American Enterprise Institute has put together a splendid webpage showing the progress of the Iranian people's struggle against their own government! And over a stolen election, too! We could have done the same over Bush's alleged "election" in '00 (stolen in FL) or his so-called "re-election" in '04 (stolen in OH), but did not. Bad on us.

And the nutjob Shah, Ayatolah Khameini, said yesterday that the Iranian Government will not give in to pressure, and neither will the Iranian People! Oh, Jeez. The guy's delusional. I suppose a realistic interpretation of the *ahem* "Supreme Leader's" remarks would be that the People and the Government will not yield to each other! For the Iranian Government and the Iranian People are now at loggerheads! Even some of the militia are now flashing peace/victory signs to the protestors!

God save the people of Iran! Allah Akbar! God is Great!

Over One-and-a-half QUADRILLION

That's right. Quadrillion. Over one-and-a-half times that. That is the notional amount of derivatives, as denominated in US dollars. As reported by the Bank of International Settlements this March. It's on page 108 of this pdf.

Oh. My. God.

And Karl Denninger has figured out how the notional amount held by any financial institution becomes its realized losses. Let's hear what Mr. Denninger has to say:

As with the phony reinsurance contracts that AIG and other insurers wrote for decades, when AIG wrote hundreds of billions of dollars in CDS contracts, neither AIG nor the counterparties believed that the CDS would ever be paid. Indeed, one source with personal knowledge of the matter suggests that there may be emails and actual side letters between AIG and its counterparties that could prove conclusively that AIG never intended to pay out on any of its CDS contracts.

Now consider this.

There is some gross "notional" (or face) value of $683.7 trillion dollars outstanding as of the end of June 08 (last data available.) [Ed-M: Now 1.567 Quadrillion dollars - read the pdf.]

The lions share of those are not "CDS" on individual names or CDOs like what is going on here with AIG. They are instead interest-rate and/or FX products of one sort or another; $458 trillion worth. [Ed-M: Now 1.406 Quadrillion dollars.]

If even a couple of percent of those swaps are in fact "private lettered" out in the fashion that AIG is alleged to have done with their CDS.....

(Hint: This is how "notional" amounts end up becoming realized losses!)

Our Congress had better dig into this hornets nest right damn now because if in fact there is any material amount of this crap going on in the OTC derivative market the $170+ billion blown on AIG trying to cover it up will be a mosquito on an elephant's ass in comparison to what's about to happen to the world's economy and banking system.

If, in fact, it cannot be proved that this is not the case, given the extraordinary lengths that both government and private parties have gone to in order to cover up that IRA alleges AIG was actually up to, we must ring-fence and cut off any part of the financial system impacted by a potential detonation of that market right now, including the US Federal Government, as such a detonation will, if it occurs, destroy any part of the financial system it infests at the time the unwind occurs.

Actually, it will literally destroy the whole entire global economy, for it is now greater than the combined value of all paper wealth and all things (including living things) on Earth. Unless we can get this Beast to unwind without exploding.

If it does explode....

And Pres. Barack Obama will be at the receiving end of the great fury of the masses (holding torches and pitchforks) as they scream at him, "Now you've done it!"

Arrest Them.

URL Source: http://www.newsweek.com/id/190362

Michael Isikoff and Mark Hosenball (Newsweek)

Over objections from the U.S. intelligence community, the White House is moving to declassify—and publicly release—three internal memos that will lay out, for the first time, details of the "enhanced" interrogation techniques approved by the Bush administration for use against "high value" Qaeda detainees. The memos, written by Justice Department lawyers in May 2005, provide the legal rationale for waterboarding, head slapping and other rough tactics used by the CIA. One senior Obama official, who like others interviewed for this story requested anonymity because of the issue's sensitivity, said the memos were "ugly" and could embarrass the CIA. Other officials predicted they would fuel demands for a "truth commission" on torture.

I don't want just truth commissions, I want all who were involved in these " 'enhanced' interrogation techniques" to be arrested. And charged with Crimes Against Humanity.

Boston Globe Article: Financial Doomsday Machine

This machine, which Elaine Meinel Supkis calls the Derivatives Beast, is threatening to undo the whole entire global economy. At its peak valuation, it was valued at more than one quadrillion dollars.

Globe Article:

If government doesn't do more, and fast, this could be worse than the
1930s. Why? There are three big reasons: [Ed-M: HAHAHA. As if the US Gov't, head over heels in debt and promises that will create more debt, can break this downturn without causing China et al to dump our foreign-held debts. The problem was practicing Keynsian Economics (deficit spending, a little inflation) without any
Anti-Keynsian economics (surplusses, a little deflation) for almost 65 years except '69 and '99, running trade deficits galore, and failing to stomp on bubbles with both feet when they first begin to form!]

Finance: A Doomsday Machine. The financial system is in far worse shape than it was when the stock market crashed in October 1929. In the 1920s, there was a stock market bubble, mainly because people could play the market "on margin," borrowing to invest in stocks. There were also scams like the original Mr. Ponzi's. Like in the present decade, the Federal Reserve helped to enable the game, with low interest rates and few rules. [Ed-M: So did the bank of Japan! It has run Zero Percent Interest Rate lending since '95 fer cryin' out loud. Result was the whole freakin' PLANET was awash in easy credit (read: cheap money for the asking!) and ended up in various bubbles, like the dotcom bubble, the housing bubble, and the recent commodities bubble, which, when it burst, cause the price of all commodities except precious metals to plummet.]

But today, thanks to "securitization" of loans and the ability of insiders to create exotic and unfathomable financial instruments, the speculative system makes buying stocks on margin look like child's play. In the aftermath of the crash of 2008, the process of sorting it all out and getting banks functioning again is something that markets simply cannot do. We are not even clear who owns what. The wise guys on Wall Street invented a doomsday machine from which there is no market escape.

In 1929 when the stock market crashed, the banking system was relatively healthy. Bank customers played these speculative games and took the losses, not banks. This time, the banks drank their own Kool-aid. [Ed-M: Here Mr. Kuttner gets it right! Bravo! Decades from now, if we're not all DEAD or back in the Stone Age by then, we'll be analysing what went wrong and exclain, "How could those banks be so colossolly stupid as to buy and sell credit default swaps, normal and 'synthetic' CDOs, MBSs and the like to and from each other?" Well it's easy. The computer whizzes who invented these things had to please their gnomish bosses! Who only wanted to get (more) rich.]....

Roosevelt was said to be a big spender, but his biggest peacetime deficit was only about 6 percent of GDP. This year, the deficit will exceed 11 percent, and the recession will deepen all year. It took the truly massive deficits of World War II - nearly 30 percent of GDP - to finally end the Great Depression. [Ed-M: Actually the Great Depression ended in 1939, when the European factories went to producing all armaments, forcing Europe to import consumer goods from US!]....

During the bubble years, the foreign borrowing disguised domestic weaknesses, such as our much-diminished manufacturing sector. For now, foreigners are still willing to lend us vast sums, but that may not continue indefinitely. [Ed-M: And CHINA, the biggest holder of our debts, has already expressed concern over our overspending. Won't be long now...]

Happy Lost Decade, everyone! May we NOT utterly collapse into a Stone Age, or kill everyone off in a thermonuclear WWIII, wherein the heavens would disappear with a roar, and the elements melt with fervent heat, and the Earth and all the works therein get burnt.

Dear Mr. President, Fire Geithner and Bernanke.

That's right, fire them. Then have your new Attorney General issue warrants for their arrest. For treason. Their policies of continuing the bailouts of the banks can only give aid and comfort to Russia, China and the Arab countries, all of who hate us.

Mish agrees.

Dear Mr. President, With All Due Respect...

Dear Mr. President, I read your New Era $3.6 Trillion Budget Proposal. I also listened to your
speech Tuesday night. You made a great campaign speech. However, the campaign is over. You won. And the reason you won is you offered hope as well as a promise
of change.

With all due respect Mr. President, Tim Geithner and Ben Bernanke are
offering the same policies as President Bush and Secretary Paulson. Those
policies are to bail out banks regardless of cost to taxpayers. Mr. President,
it's hard enough to overlook Geithner's tax indiscretions. Mr. President, it is
harder still. if not impossible, to ignore the fact that neither Geithner nor
Bernanke saw this coming. [Ed-M: but they knew it's been here since the first collapse of an old institution last MArch: Bear Stearns.] Yet amazingly they are both cock sure of the solution. Even more amazing is the fact that solution changes every day.

With all due respect Mr. President, Geithner and Bernanke are a huge part
of the problem, and no part of the solution and the sooner you realize that the
better off this nation will be.

With all due respect Mr. President, your budget proposal is the same big
government spending as we saw under President Bush. The only difference is you
promised more spending and bigger government, while President Bush promised less
government and less spending and failed to deliver on either count.

With all due respect Mr. President, it is impossible to spend one's way out
of a problem, when the problem is reckless spending.

Citigroup Fading Fast

Source: CNN

Chart is self-explanatory. Rumour has it that the street is not confident that this gnomes' lair will be saved before it collapses completely into insolvency.

They Don't Call It Totalitarianism for Nothin,

http://www.gold-eagle.com/editorials_08/willie021309.html

Karl Marx was an annoying man with some brilliant thoughts, whose work was like a football that Vladimir Lenin ran with. If his words prove correct, and the first few tenets seem right on the mark, then what follows in the Untied States will be anything but continued freedom. Calling it socialism might be a stretch. He wrote in "Das Kapital" the words: "Owners of capital will stimulate the working class to buy more and more expensive goods, houses and technology, pushing them to take on more and more expensive debt, until their debt becomes unbearable. The unpaid debt will lead to the bankruptcy of all banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism."

Unfortunately, everywhere where the Communists tried to implement Communism, it ended up as pure fascism. Really.

Coming: Death to Bank of America and Citigroup

The stocks of bank of America and Citigroup have collapsed to below $5.00 a share - they are both penny stocks!

Charting Stocks Gone In 60 Days: Citi and Bank of America Won't Live to See May

Bank of America and Citigroup won’t live to see May. The two banks will be nationalized in the coming weeks, and we think that the announcement can come as
soon as tomorrow evening (Friday evenings are when major bank announcements and failures occur).


The US government has already committed half a trillion dollars to these two firms which is more than 10 times the amount it would cost to buy and control both companies. The market doesn’t believe that $500 billion is enough to save these companies.

Today both banks made fresh new lows with Citi closing at $2.51 and Bank of America closing at $3.93. The 1 year charts below show the short term price movements. You should understand that when a bank stock’s chart looks like
this, even a HEALTHY bank would be in trouble. Nobody wants their deposits tied
up in a company that trades at $2. The outflows of deposits from Bank of America
and Citi must be catastrophic.

And here are their stock price charts!

Source: Chartingstocks.net

The US Gov't will need a lot more than the $500Bn already spent to bail out these banks. Don't count on any bailout for any banks to get through Congress this time -- both Dems and Repubs are majorly pissed off at the banking gnomes who took their year-end bonuses out of the first TARP. When Obama and Geither go to Captiol Hill and tell them that the new TARP is must-pass, the Repubs plus some Dems will shoot it down, probably by filibuster!

I gots two credit cards from Bank of America, both with zero balance. When it goes under, I am sure those cards will be useless!!!!!

The Birds

Over at James Kunstler's "Clusterfuck Nation," someone posted an item about omens presented by flights of birds in ancient Rome, WRT inaugurations and getting major projects started.

Emerson taught that all words have their roots in nature. I was curious
what the roots, or etymology, are for the word "inauguration".

Here's what one online dictionary says: "1569, from Fr. inauguration
"installation, consecration," from L. inaugurationem (nom. inauguratio)
"consecration, installment under good omens," from inaugurare "take omens from
the flight of birds, consecrate or install when such omens are favorable," from
in- "on, in" + augurare "to act as an augur, predict" (see
augur/browse/augur)."I guess people used to inaugurate when the omens were
favorable from watching bird flights? Funny, last week we had a bird flight take
out an airplane in New York, causing it to crash in the Hudson River. Although
no one was killed, it was a very scarey and traumatic event. An omen?

If it's an omen of anything, it means that Pres. Barack H. Obama is the Gorbachev of the United States -- in other words, our last president as the country collapses.