1. America's credit rating may soon be downgraded below AAA 2. Fed refusal to disclose $2 trillion loans, now the new "shadow banking system" 3. Congress has no oversight of $700 billion, and Paulson's Wall Street Trojan Horse 4. King Henry Paulson flip-flops on plan to buy toxic bank assets, confusing markets 5. Goldman, Morgan lost tens of billions, but planning over $13 billion in bonuses this year 6. AIG bails big banks out of $150 billion in credit swaps, protects shareholders before taxpayers 7. American Express joins Goldman, Morgan as bank holding firms, looking for Fed money 8. Treasury sneaks corporate tax credits into bailout giveaway, shifts costs to states 9. State revenues down, taxes and debt up; hiring, spending, borrowing add even more debt 10. State, municipal, corporate pensions lost hundreds of billions on derivative swaps 11. Hedge funds: 610 in 1990, almost 10,000 now. Returns down 15%, liquidations up 12. Consumer debt way up, now at $2.5 trillion; next area for credit meltdowns 13. Fed also plans to provide billions to $3.6 trillion money-market fund industry 14. Freddie Mac and Fannie Mae are bleeding cash, want to tap taxpayer dollars 15. Washington manipulating data: War not $600 billion but estimates actually $3 trillion 16. Hidden costs of $700 billion bailout are likely $5 trillion; plus $1 trillion Street write-offs 17. Commodities down, resource exporters and currencies dropping, triggering a global meltdown 18. Big three automakers near bankruptcy; unions, workers, retirees will suffer 19. Corporate bond market, both junk and top-rated, slumps more than 25% 20. Retailers bankrupt: Circuit City, Sharper Image, Mervyns; mall sales in free fall 21. Unemployment heading toward 8% plus; more 1930's photos of soup lines 22. Government policy is dictated by 42,000 myopic, highly paid, greedy lobbyists 23. China's sees GDP growth drop, crates $586 billion stimulus; deflation is now global, hitting even Dubai 24. Despite global recession, U.S. trade deficit continues, now at $650 billion 25. The 800-pound gorillas: Social Security, Medicare with $60 trillion in unfunded liabilities 26. Now 46 million uninsured as medical, drug costs explode 27. New-New Deal: U.S. planning billions for infrastructure, adding to unsustainable debt 28. Outgoing leaders handicapping new administration with huge liabilities 29. The "antitaxes" message is a new bubble, a new version of the American dream offering a free lunch, no sacrifices, exposing us to more false promises Will the next meltdown, the third of the 21st Century, trigger a second Great Depression? Or will the 2007-08 crisis simply morph into a painful extension of today's mess to 2011 and beyond, with no new bull market, no economic recovery as our new president hopes? Perhaps some of the first 29 problems may be solved separately, but collectively, after building on a failed ideology, they spell disaster. So listen closely to "leading indicator" No. 30: At a recent Reuters Global Finance Summit former Goldman Sachs chairman John Whitehead was interviewed. He was also Ronald Reagan's Deputy Secretary of State and a former chairman of the N.Y. Fed. He says America's problems will take years and will burn trillions. http://www.marketwatch.com/news/sto...x?guid={B28B49B5-EFD1-4941-B57E-A2BA1545BA09}
No. 32: A country that makes nothing of tangible value, produced domestically, and both purchased domestically and exported for purchase to other nations, for a profit, can't sustain a tier one economy. Such countries ultimately become 'Banana Republics,' no matter what financial chicanery and obfuscation they resort to, short term.