AMERICANS & WORLD MUST PREPARE FOR RECESSION
Pretending to be conservatives; minority controlled majority mainstream Media
with the money from their like minded counter parts in Wall Street & Hollywood;
with their unprecedented feed is trying to brain wash American public with
their choice of candidates without educating them about massive financial &
other problems. They are behaving as we are in the process of electing a Media
endorsed Pastor (radical/Liberal with vast in-experience) not President or
Commander in Chief of United States of America. Media & practically all the
Presidential Candidates have failed in their fiduciary duties to expose the
massive financial crises and other serious problem to the American public.
$9 trillion National Debt & $50 trillion in hidden unfunded liabilities;
mandatory social security & Medicare payments, government & military pensions,
interest on debt. To make matters worse; falling dollar, falling Equity markets
where major indices are down by over 10% so far this year from their highs,
falling US Treasury now yielding 3.87% down from 5.3% just 3 years ago, high
commodity prices, ever rising energy prices & worst ever credit markets. All of
this has made us biggest debtor nation in the world because American public,
our state & Federal governments are living beyond their means. On top of this
America is at war in Iraq & Afghanistan besides 38 other countries to fight
serious threats of terrorism at home & American interest abroad. On top of
every thing 4 million illegal immigrants are crossing US borders every year
which is a National Threat.
Falling Real Estate Prices & Mortgage crisis is due to one of the debt
derivatives RMBS and Pulse Only Loans given to people with bad or no credit
history by crooks in Banking & Real Estate for points & other dubious fees.
Merrill Lynch write down for 3rd quarter of $7.9 billion for its portfolio
backed by sub prime mortgages is the biggest quarterly loss since it was
founded in 1914. Citibank has taken a $7 billion write off for Q3 due to
sub-prime mortgages and whispered to media they have another $15-17 billion
like Merrill Lynch has another &12-15 billion. Countrywide Home Loans the
biggest Mortgage lender took a $2 billion Q3 write off for the first time since
its inception 25 years ago. Countrywide in Sep & Oct took out $22 billion from
different banks from unused credit limits. By the time Banks realized what they
were doing it was too late. Rumors are Citibank or Wachovia is going to take
their worthless equity so that they dont have to disclose to its
shareholders the money has been lost. On their heel is No. 2 buyer & guarantor
of home loans Freddie Mac posted it largest Q3 loss of $2 billion, Wachovia
$1.75 Billion and the list goes on and on. Conservative estimate for such write
offs combine of all Banks & non-Banks of America is around $130 billion and
will go up to $350-$400 billion if one trust the numbers of US Congressional
Report of estimated 2 million Sub Prime Mortgage foreclosures by 2009.
Yesterday Citi repeated history again; in 1991 it sold over 4% equity to Saudi
Prince and now 4.9% to Abu Dhabi for $7.5 billion to cover its anticipated $11
billion Q4 losses stemming from sub prime loans. Citis desperation to sell
itself to Middle East is an indication all US Banks & Non Bank institutions
like AIG, Zurich Re are for sale. American public must act now and demand full
disclosures for debts based on crafty derivatives.
Housing wealth has already lost $71 billion; states will lose $920 million in
Property Taxes revenues alone in 2007 because of foreclosures. US housing
market is valued at $22 trillion; down turn is going to have wider implications
than Tech Boom burst 7 years ago. Housing Slump, bad equity market, bad credit
market, rising debts & falling US Treasury are all based on crafty debt
derivatives a nuclear bomb; is going to keep entire US economy on life support
for next 2-3 years which in turn keep the world economy in intensive care for
3-5 years.
Debt derivatives RMBSs, CDPCs, CDOs & CLOs a creation of Thugs from Wall
Street & world bankers is like a rug on the world financial problems. These
derivatives represent about $345 trillion, which is 9 times the GDP of entire
world. General public & majority of Politicians have very little or no
knowledge of such derivatives based on other debts. In lay men terms each time
a debt is repackaged and sold it grows in some cases exponentially to take care
of the brokers fees, advertising, marketing, funding to Politicians and mark up
for Wall Street/similar firms as the case may be around the world. These debt
derivates have created an enormous inverted pyramid of global debt thousand
times greater than the value of the underlying assets and Americans hold
majority of it.
Think of it what will happen if the underlying assets (like real estate) upon
which all of this pyramiding debt are based; declines in value? Think of other
derivates CDPCs, CDOs & CLOs which are based on other debts unlike RMBSs
which is based on Real Estate; decline in value in fact are already declining
in value. Who gets sucked up holding these worthless uncollectible Debts? The
answer is American Public & Americas trading partners around the world!
Just to make it simpler for the general public here is the explanation for
the looming biggest financial crisis in the world. Majority of the sub prime
defaulters are in the category of loans between $100,000.00 to $300,000 where
people are not too smart to understand the finer prints created by attorneys
like John Edward running for President. On paper a home owner took a loan of
$100 and in reality was given $82-$85 after deducting points, administrative
fee & broker fee for a property which was actually worth $80.00 but inflated to
$100.00 to cover the mark up of crooks in Banking & Real Estate.
Now these kinds of loans from different parts of USA are clubbed by a genius
at Wall Street and the repackaging cost is $30.00 which includes mark up for
this genius, marketing, advertising, broker fee & donations to political
parties with a face value of $100 on a under lying asset of $80.00 with an
assumption the market will go only North not south. Unfortunately the market
has gone South and real estate is down by 40- 45%. So the underlying asset now
after losses & $30.00 repackaging cost is $10.00 -15.00. That much this Bond
with a face value of $100.00 is worth today based on this under lying asset
which big Pension Funds & individuals are holding in their Portfolios. Imagine
if every one wants their money back! These Bonds are worthless.
That is what Main Stream Media & American Politicians does not want the
Public to know that US Govt. pumped in over $50 billion to keep the liquidity
in the market and forced their European & other allies to pump in another $ 200
billion to put a thick rug on the crisis which is 10-20 times bigger than the
Tech burst of 2000. People like Hillary Clinton who is being heavily financed
by Wall Street, Hollywood & main stream Media wants to rescue with American Tax
Payers Dollars these highly qualified crooks well versed in Laws who with full
understanding & knowledge of financial markets including derivatives gave Pulse
only loans to people with no or shaky credits and then created worthless Bonds
which has been sold to these loan takers and others in their personal
portfolios, Retirement & Pension Funds. Bravo! Bravo! Bravo!
Last week 5 biggest Wall Street Firms shamelessly announced they are going to
give out $38 million in Bonuses which is $5 million more than last year to
their employees for doing frauds with American public. It works out to be
$200,000.00 for each employee. It is an insult to American public.
Still this minority controlled mainstream Media is dictating; Americans must
elect their new President rather a radical Pastor with no character &
integrity, no vision & understanding of economy may be a con artist or a money
machine dependent on Wall Street, defense contractors & Hollywood or a born
again Christian or an Ambulance chaser all with vast inexperience.
History is our witness we American have always come out of much bigger crisis
than what we are facing now. Federal Reserve Chairman Ben Bernanke does not
mind inflation to avoid recession. Higher inflation will create more poor in
America so we have tough decisions to make as well as we all have to make
sacrifices to save our country from recession & terrorists.
In the coming Presidential election Americans will use their judgment in
selecting a Leader who will be able to bring us out of this looming recession
created by inverted Debt Pyramid based on imaginary assets and non existent
earnings and terrorism. Every American including a new born child has a debt
of over $35,000.00 to pay because of these massive debts. Rember this figure is
changing every minute because of the carrying cost "Interest" and massive cost
to fight terrorism at home and abroad. We need a Leader who should be able to
solve to certain extent all our domestic problems and serious threats to our
domestic & national security. That Leader we have very much present among us we
just have to look beyond our Media endorsed candidates with vast in-experience
and fake conservative mask.
God bless America & Every Human on this planet Earth.
Dave Makkar
www.citizensfordemocracynj.org
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