http://globaleconomicanalysis.blogspot.com/2009/08/emails-from-bank-owner-regarding-fdic.html 1. Paulson appears on Face The Nation and says "Our banking system is a safe and a sound one." If the banking system was safe and sound, everyone would know it (or at least think it). There would be no need to say it. ....................................................................................... The only reason that most banks are operating is because of fraudulent accounting.... Think of it this way.... Let's say one sets out to get a loan....and gets a third party to verify value.....who is paid to agree to whatever the stated value is needed for the loan....when payments cannot be made....the bank forecloses on an asset that is worth nothing.... This is the state of the US banking system.... .................................................................................... So the fact is that only a slight breeze will still make the house of cards fall.... ................................................................................... What will help ? Structural tax law changes that will create sustainable enterprises and thus much needed "real" valuations....which in turn creates much needed bank capital.... ................................................................................ What would do this ? A 10/5 C tax only....
With many regional banks seeing an incredible 10% to 22% of their loan not "performing" (i.e. in default), it would appear that even the fraudulent scheme hatched and implemented by the government and the banking sector to suspend M2M, and to allow banks to fantasize about "future asset valuations," and to use those number rather than realistic ones, and on top of that, giving banks access to as much taxpayer money as they needed to recapitalize, didn't work. At a time when the asset values, and hence, the value of the paper securing those assets, keeps falling, month after month, year after year, trying to recapitalize is akin to trying to bail water out of a sinking boat with cupped hands. As far as the 'Too Big To Fail' banks, they're already zombified.
Recent IMF comments.... http://online.wsj.com/article/SB125062555995240855.html The gist of today's IMF suggestions is to change to an export driven economy.... Is not going to happen without proper structural tax change.... Still....there is not a single comment from the DC moronic system which would be helpful.... EVERYTHING suggested so far by DC morons only suggests digging a deeper hole to get out of.... Time to start shoveling dirt back into the hole....instead of digging it deeper.... This is what they teach at " Harvard".... HOW TO BECOME EDUCATED BEYOND ONE'S INTELLIGENCE....
They will just print the money needed. And it won't even create inflation because it's just replacing toxic debt.
It's not the tax structure, contrary to what you may think. It's the inflated cost of living, along with regulatory & legal costs, due to the financial system. 10% consumption tax would accomplish little, as no real manufacturing will ever come back to the US.
............................................................................. Some of this can happen .... until bond auctions fail.... Why position the well being of the economy on "bigger fool theory".... ................................................................................ Nice.... ..................................................................... Do not worry.....Larry Summers will be next on stage.... You know....the one selling ....via DE Shaw.... CDOs to Sovereign Funds after the Bear Stearns funds collapse....
............................................................................................. 1000% correct about "legal largesse" being one of the items contributing to noncompetitive prices.... 1000% wrong about tax structure..... http://en.wikipedia.org/wiki/Tax_rates_around_the_world ............................................................................... BRIC tax rates are not very competitive.....This is one of the only possible solutions that the US has..... The tax take that seems too low at the moment will dwarf the take from the current declining system.... Not to mention the total freedom of individuals from the likes of the IRS which is incredibly helpful.....The word taxhaven would not even be needed.... Every company of any significance would want the US domicile.... Jobs would pile into the US....and the US can become far more competitive with BRIC....whereby their tax costs are significant vs labor.... A 10/5 C tax is one of the only options that the US can actually pull off.... ........................................................................ So where is the US going ? In all probability an additional VAT tax ....in addition to higher rates.....which will place the US in a deeper and deeper hole...... The tax take rendering the US noncompetitive vs BRIC for decades.....When one adds legal largesse to this.....even worse.... The solution is easy to implement.....and can happen with only the stroke of a pen.... Implementation by DC ....ain't going to happen.... It is as if the DC clowns want to win the race to the bottom.... If the tax angle is not plausible.....then the US is RIP.... The tax angle is the best shot the US has..... Otherwise...as they say in NY.... "Forget about it".....
............................................................. Or the US creditors .....acting now vs later.... In a "real sense"....there is net nothing in the banks overall.... Including the FDIC.....