Sherman: Fear Fueled Bailout - Video Inside

[Gold9472]

King: Financial crisis merits 9/11-type study

http://www.desmoinesregister.com/art...0357/1001/NEWS

By THOMAS BEAUMONT • tbeaumont@dmreg.com • October 15, 2008

U.S. Rep. Steve King called Tuesday for a commission to study the financial collapse, similar to the panel that studied the 2001 terrorist attacks in the United States.

King, who opposed the Wall Street rescue measure in the House, also said Monday's market turnaround does not necessarily weaken his argument that a private-sector bailout is preferable to the $700 billion, taxpayer-funded bailout.

The Republican, who is seeking a fourth term as Iowa's 5th District representative, met Tuesday with Des Moines Register reporters and editors.

"Last week, we had the worst week in history. Yesterday, we had the best day in history. So, what we know is (markets) are as volatile as they can be, volatile as they have ever been," King said. "I'll always believe free-market solutions are superior to government solutions when it comes to these kind of things."

King, a former state senator from Sac County, is being challenged by Council Bluffs Democrat Rob Hubler. Republican voter registration tops that of the Democrats by more than 44,000 in the 5th District, which covers Iowa's 32 westernmost counties.

Hubler said he would have supported the House bills that in recent weeks granted the U.S. Treasury secretary broad authority to buy the bad assets of the nation's largest banks.

A House bill, defeated on Sept. 29, was amended in the Senate, where it passed on Oct. 1. The revised version passed in the House on Oct. 3, the day President Bush signed it.

King had proposed an alternative that sought private investment to shore up the banks.

King said he would prefer that an independent commission determine the causes of the financial crisis, rather than one led by majority Democrats in Congress. He said the financial crisis must be studied to reduce the chance of a recurrence.

"I think we need to expand this entire financial situation - kind of stretch it out like an accordion - and examine each one of the pieces, and find out where the flaws are in a logical, methodical fashion," he said. "Let's do a 9/11 Commission on our financial situation."

King said leading Democrats on banking issues in Congress have rejected past efforts to restructure Fannie Mae and Freddie Mac. GOP presidential nominee John McCain has made similar comments. The two quasi-public mortgage lenders were cited as contributing to the collapse of the credit markets over the past month.

"We would have (Massachusetts Rep.) Barney Frank and (Connecticut Sen.) Chris Dodd chairing the committees," King said, referring to the Democrats who lead the banking panels in Congress. "So, if my alternative is an independent commission, versus Chairman Frank and Chairman Dodd, I have to say an independent commission would do a far better job."

[Gold9472]

How many other times have "9/11 Type" investigations been recommended for things? I know one for Katrina was recommended. I know others have been mentioned as well. Doesn't that constitute "praise" for the 9/11 Report, and shouldn't these requests be put in that thread?

[simuvac]

How many other times have "9/11 Type" investigations been recommended for things? I know one for Katrina was recommended. I know others have been mentioned as well. Doesn't that constitute "praise" for the 9/11 Report, and shouldn't these requests be put in that thread?

I suppose, if you want the thread to be more generic, that is, about more than the "bailout = 9/11" meme.

[Gold9472]

Katrina

http://www.pbs.org/newshour/bb/weath...blame_9-8.html

SEN. JOSEPH LIEBERMAN: We're going to do it, and I think frankly this is a case where at least two big investigations are necessary and will be constructive.

JIM LEHRER: Sen. Collins, where do you come down on that 9/11 type of commission for this?

[Gold9472]

http://www.cnsnews.com/public/checker.aspx?rsrcid=35749
http://help.lockergnome.com/general/...pict55903.html
http://www.salon.com/opinion/walsh/e...in_commission/
http://www.politico.com/blogs/jonath...al_crisis.html

[Gold9472]

I suppose, if you want the thread to be more generic, that is, about more than the "bailout = 9/11" meme.

Heh... I thought this thread WAS a generic "bailout = 9/11" meme?

[simuvac]

Heh... I thought this thread WAS a generic "bailout = 9/11" meme?

It is. I said, if you want it to be more generic, that is, more general.

[simuvac]

http://www.tehrantimes.com/index_View.asp?code=180900

West facing a 9/11 financial crisis: Larijani
Tehran Times Political Desk


TEHRAN – Majlis Speaker Ali Larijani has likened the West’s financial crisis to the September 11 attack on the United States.


Addressing the Majlis Sunday session, Larijani said, “The financial turmoil in the West will not end soon and it is like a September 11 economic crisis.”

He said the United States financial downturn started after President George Bush took office in 2001. “The U.S. at the time had $200 billion excess profits but wrong policies on different issues like cutting taxes… and the wars in Iraq and Afghanistan caused the current turmoil.”

“Now, Bush is leaving office with $4500 billion deficit. The U.S. financial crisis is caused by the lack of credibility and trust,” the Majlis speaker added.

He said, “The U.S. financial meltdown and the failure of the Greater Middle East and Annapolis plans are the result of the careless performance of the U.S. adventurous conservatives.”

Larijani said during his recent visits to Finland and Switzerland, he discussed the global credit crunch with the leaders of the two countries.

The Majlis speaker accused the U.S. of trying to “direct the financial crisis to the energy producing countries and to create a false fear in these states in order to steal their wealth.”

He called on the parliament’s research center to carefully investigate the U.S. financial crisis and its effects on the world markets

[Gold9472]

Queen's scholar links credit crunch to 9/11

http://www.belfasttelegraph.co.uk/ne...-14018268.html

Tuesday, 28 October 2008

A Queen’s University academic has claimed the seeds of the current global credit crunch lie in the US response to the 9/11 terror attacks.

Dr Andrew Baker made the claims at the launch of a new Politics, Philosophy and Economics degree at Queen’s. The course — the first of its kind in Ireland — will give students a unique insight into how politics, business and commerce overlap and including what has caused the global economic crisis.

Launching the course, Dr Baker said: “While there is no simple, straight-forward explanation for the recent economic downturn, we can trace the roots of the crisis back to the 9/11 terror attacks. After 9/11 American people were encouraged to spend, spend, spend in the spirit of patriotism, to help restart the flailing economy.”

Gerry Mallon, Chief Executive of Northern Bank, said: “The current crisis illustrates just how intertwined political, philosophical and economic issues are. The introduction of this degree at Queen’s could not be more timely.”

A similar degree at Oxford University boasts an impressive list of graduates including former Prime Ministers and Presidents, such as Harold Wilson and Bill Clinton, businessmen like Rupert Murdoch, politicians such as Imran Khan, and journalists including BBC political editor Nick Robinson.

Anyone interested can find out more at the School of Politics, International Studies and Philosophy at Queen’s tomorrow at 1.30pm or visit the School of Politics, International Studies and Philosophy website at www.qub.ac.uk

[Gold9472]

9/11 ‘the root’ of the financial crisis

http://www.shropshirestar.com/2008/1...ancial-crisis/

10/28/2008

The roots of the global financial crisis lie in the September 11th 2001 terrorist attacks and the US reaction to rebuilding the nation, it has been claimed.

Analysis by Dr Andrew Baker at Queens University sees the then chairman of the Federal Reserve Alan Greenspan as the architect of the today’s crisis and the financial bubble that grew from it.

“The perfect epitaph for Greenspan would be Chairman Bubbles,” explained Dr Baker to myfinances.co.uk.

“He just kept on cutting interest rates after September 11th and pushed financial innovation.”

In the wake of the attack on New York interest rates in the US dropped from six per cent to one per cent by 2003 – where they stayed until 2004.

“While there is no simple, straight-forward explanation for the recent economic downturn, we can trace the roots of the crisis back to the 9/11 terror attacks,” he explained.

“After 9/11 American people were encouraged to spend, spend, spend in the spirit of patriotism, to help restart the flailing economy.

“To fuel that spending, in the extraordinary political and psychological climate of that time, US policy makers actively encouraged levels of borrowing and lending that would never otherwise have been allowed.”

He added: “There was the belief that ultimately the market would work its magic. Greenspan was being feted for his miracle that allowed low interest rates, low inflation and growth.”

But Dr Baker explained the miracle lay within complex bundling and selling on loans and mortgages and the creation of new vehicles people did not understand.

He explained the markets are a psychological beast that responds to stimuli and Greenspan was spreading the message it was patriotic to encourage growth, to borrow and to spend.

A further problem he outlined is the growth of incentives and compensation packages that rewarded those who could see on the bundles of repackaged loans.

“They tried to make the unsustainable sustainable, but much of these investments depended on property prices rising.

“As property prices came down, banks were left with a lot of debt.”

Dr Baker explains many were quick to blame irresponsible individual bankers for the crisis as illness spread between banks “but the reality is that the free market society in which we lived encouraged risk taking and has created a complex system whereby losses in one sector, such as property, have implications for the entire economy.

“That system of financial complexity was created, endorsed and promoted by the regulatory and policy decisions of governments, as well as by the innovations of banks.

“The problem was that the complexity of the system was so great that too few people understood how it worked and its implications.”