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Posted by Kat Hak Sung on January 28, 2009, 7:06 pm, in reply to "575. Mumbai attack (1) (12/5/08)"
581. Orderly bankruptcy, a sword of Damocles (1/10/09)
On 5/17/08, news reported that Congress passed the bill to drop the jumbo loan rates on mortgage of up to $729,750 in high priced parts of the country. Funnie Mae and Freddie Mac previously had a cap on that Jumbo loan - $417,000. It's a big leap forward. On same day, Funnie Mae announced new rule of small down payment for mortgage - 3% to 5%. Previously it was 10% . It may reflect what Bush said at that time, the economy of US was basically sound.
But two months later Federal officials said they needed a bailout to rescue the mortgage giants. What happened? Certainly it was not because of new rule. It was less than two months after the new regulation. New house buyers may have started their application procedure but have no time to enjoy the new benefit yet, let alone to go new foreclosure. The collapse of Funnie Mae and Freddie Mac was manipulated, on the purpose to touch off a financial crisis to cover up "Dollar crisis" caused by excessive petro dollar.
Remember I revealed it on 7/4. The oil price turned around its rising curve and started its descending since then. And one week later, on 7/11, a new project to stabilize the dollar was done - to create a financial crisis. Then we saw a series of psychological operation - news propaganda on "troubled real estate giants" even though two months ago it was full of confidence to save the housing market. Government is the sponsor of FunnieMae and Freddie Mac. It controls and directs the business of the two. If Feds wants the two going bankruptcy, they went bankruptcy. Outsiders never know the truth.
But Funnie and Freddie are limited to real estate only. To push up a financial tsunami, the Insiders need another big name - it was Leman Brothers. Though real estates loan was an important business for Leman Brothers, it also packed various other kind of loan to investors. The bankruptcy of Leman Brothers vastly effects in financial area -banks, mutual funds, insurance company, money market ... Feds could have saved Leman Brothers like they saved Bear Stern. The cost would be much smaller compare to 700 billion they used in later rescue plan. But they let it go. Because the bankruptcy of Leman Brothers is a necessity to push up a financial tsunami.
It is a very successful plan. All investment fund, or speculating money, or petro dollar, are locked in a balloon of US bond. Feds has whips in hand. Any one dares to invest in other area are beaten. Foreign currency? Most devalued to dollar. Stock market? Anytime will lose several hundred points. Real estates? No one knows where is the bottom. Feds also has intimidation in hand: media predict more lay offs, more bankruptcy. One interesting thing is Media's propaganda on Auto giants' bankruptcy. They say US auto industry is inefficient and deserve a shut down. But Government still gave the Auto giants a little money to survive several months. What for? If you have a boat, and know there is a big hole in the bottom and the sinking is inevitable, will you spend more money to paint it or decorate it? Why not use the money to buy a new one? But they still spend money on a sinking boat, says it is an "Orderly bankruptcy". Is that ridiculous?
I view the "orderly bankruptcy" as a sword of Damocles. It warns you that if you dare to invest, the sword will drop on you any time. By announcing the bankruptcy of Ford or GM, Feds could create another stock market earthquake. The purpose is to maintain the balloon of the US bond. Keep the money from leaving.
How long will the balloon be kept? I think they planed to keep it for several months, no longer than one year.
582. Robert Gates' career prolonged for Iran war (1/15/08)
Petro dollar benefits US economy a lot. When Iran abandons dollar as oil trading currency, it shakes dollar foundation significantly. To stabilize the dollar position, the war on Iran is inevitable. The latest attempt to war on Iran was failed in August 2008. Next month, in September, a financial crisis is created to save the dollar. The financial crisis push people to change the investment into cash - the dollar, and drives the dollar into a balloon - US bond. The Inside Group will keep that balloon for months, no longer than a year. They will keep that balloon until the Iran war break out.
The reason I said so is out of a decision made by the President elect - Obama. He decides to let Bush's Defense Secretary - Robert Gates to stay in chair for one more year. It means the Inside group still wants to finish Iran war within a year. They maintain that dollar balloon from popping until the war comes.
Robert Gates is a well selected neo-con follower. He is no other than Rumsfeld, Bush and Ashcroft. He has been chosen to command the soured Iran war of 2008 August. No one is more familiar with that war project then him. No one will work better than him with that military official group inside Pentagon which developed the Iran war project. It was an urgent war. If Bush can't stay in President seat, Gates will be the right person to stay for the war.
Barak Obama won the president election by his slogan "change". One important reason he won the campaign is because he said he opposes Iraq war. But when it touches the interest of the Inside Group, he has to obey. In an area where needs an utter "change", he reacts with "un change". He says he opposes Iraq war, because the bird is held in hand already. It doesn't cost anything but a lip service. But when his master gave an order, he will hug another war.
Politicians are picked up from the followers of the Inside Group. High ranking politicians have been all screened tier upon tier. They are all the same even though they pretend to be different by sticking a different sign of donkey or elephant. When people are tired of a white wolf, they gave you a black one. But on the core it's the same. Wolf won't change its habit to eat lamb.
There is a Chinese fable: Three for breakfast and four for super. It says a monkey keeper gave his monkey four nuts in breakfast and three for supper. Monkey felt hungry and protested. The keeper thought for a while than pretended compromise. He said, "OK, you win, I will give you three nuts in morning and four in the evening." Monkey thought it won because the keeper changed three into four for supper. So when Obama gives you four nuts for supper but three in the morning, do you think there is a change?
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