Bank Nationalization Coming Soon?

During the Great Depression, then President Roosevelt never considered a move to nationalize the banks of the US. To stabilize the banking sector, he declared a bank holiday, passed strict regulations on the banking industry, and put people's trust back into the banks.

But President Obama doesn't see that. He is intent on destroying the banking system of the world in order to promote his socialist agenda.

Rumors of a plan to nationalize U.S. banks have fueled debate this week in Washington and on Wall Street over how far the Obama administration will go to rescue the financial industry, but lawmakers and economists are divided over whether such takeovers are likely or necessary.

The idea, however, is being raised by an unlikely mix of lawmakers, including Sen. Lindsey Graham, a conservative Republican from South Carolina.

"I'm very much afraid that any program to salvage the banks is going to require the government," he said on ABC's "This Week" last Sunday. "I would not take off the idea of the nationalizing the banks."

Joining Graham in talking up the idea this week -- and proving that politics can make for strange bedfellows -- were Senate Banking Committee Chairman Christopher Dodd and former Federal Reserve Chairman Alan Greenspan, who both said that banks may have to be temporarily nationalized to help lenders such as Citigroup and Bank of America survive.

"I don't welcome that at all, but I could see how it's possible it may happen," Dodd said on Bloomberg's "Political Capital with Al Hunt," to be broadcast this weekend. "I'm concerned we may end up having to do that, at least for a short time."

Greenspan told the Financial Times, "It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring. I understand that once in a hundred years this is what you do."

The stocks of Bank of America and Citigroup, which have received $90 billion in federal aid in the past four months, fell sharply Friday during mid-day trading, presumably on fears they may be nationalized, but they rebounded somewhat at the close after the White House insisted it's not trying to take over the two ailing financial institutions.

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This move doesn't surprise me one bit. It is just another step in the direction of true socialism and the destruction of a free economy.

It is time we let banks or businesses stand or fail on their own. The banks received $750 Billion dollars in bailouts, yet have not changed their way they do business. With expensive junkets for their boards, takeovers of more successful banks, overseas investment (specifically in China), and a general atmosphere that the government will just keep handing them more money, Banking officials are pulling the nation closer to the eventual government takeover of their industry.

No government in the world has successful been able to run any industry, any business with success. There is always mismanagement, and waste in their running of businesses. This was true under the Soviet Union, is true under Communism today, and will be true when Obama orders this.

Goodbye to the banking world. Hello to the new Communist world of the United States.

Gaza banks may collapse

It seems that the banking crises is not just in the United States. Banks all over the world have been hit hard, some are even out of cash. Like the ones in Gaza.

The World Bank and the International Monetary Fund on Saturday warned that Gaza's severe cash shortage may cause local banks to collapse, the most serious warnings yet regarding the consequences of Israel's refusal to allow new money infusions into Gaza banks.

Israel has not allowed money to enter Gaza since October, causing cash shortages in local banks.

Israel's refusal to allow Palestinian banks to transfer cash to their Gaza branches is a part of a larger blockade imposed on the territory in response to Palestinian rocket attacks from Gaza.

"The liquidity crisis could lead to the collapse of the commercial banking system in Gaza," the World Bank warned in a statement. The International Monetary Fund offered a similar prediction.

The cash shortage means around 77,000 Palestinian civil servants will not be able to withdraw their salaries before a Muslim holiday early next week. The cash shortage also forced the United Nations in November to halt cash payments to thousands of Gaza's poorest residents.

Gaza banks closed on Thursday - payday for civil servants - because of cash shortages. Bank officials have not said if they will open Monday, their next working day.

Monetary officials estimate Gaza banks hold less than a quarter of the cash needed to pay wages. The NIS is Gaza's main currency.

Jihad al-Wazir, head of the Palestinian Monetary Authority in the West Bank, said Gaza's banks have around 47 million shekels (about $12 million) between them. They need 220 million shekels ($54 million) to pay salaries, he said.

Al-Wazir said salaries may be paid in a mix of currencies to bypass the shekel shortage.

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Funny how the PalArabs haven't designed their own currency yet, or just printed up fake Israeli currency. Either one would solve their problem.

Or maybe they are waiting for the US Congress to bail them out too. After all what is another billion or so dollars.

If the PalArabs want their own nation, they better start building an infrastructure that works. Scrounging off of the Israelis is not any solution to their problems.

A Horror Tale of Financial Woes

Hat tip to Maggie's Notebook

Once upon a time, in a land called the United States, people would try and buy a home. They would save for years and keep their credit clean. They would look through out the neighborhood for a home they would like to buy. Then they would hope and pray that their local bank would grant them the all important mortgage. When the bank would grant this wondrous gift, they would rejoice and move into their new home. But this gift of mortgage came with a price. They had to pay it back to the bank. A payment to be made on the 1st of each month, over the course of 30 years. The people did not mind paying the mortgage. It was not as much as the rent they had been paying. The nation was in good shape when this was done.

Then in 1977 a strange thing happened. Jimmy Carter, then the President of the United States, convinced the members of Congress (the people who make the laws) to pass the Community Reinvestment Act. This Act gave birth to 2 children: Fanny Mae and Freddie Mac. This Act was a good idea, for it gave the gift of mortgage to more people, in neighborhoods in which the banks originally gave a redline to. As long as the people had good credit and some savings, the bank would give them a mortgage and the nation was in good shape.

Then one day in 1995, a new President by the name of Bill Clinton decided that although the Community Reinvestment Act was good, it needed to become better, to let more people buy a home. So he changed the Act so everybody could buy a home.

This should have been a good thing, but it was the worst thing that could have been done. For no longer would the people have to have good credit and savings to get the gift of mortgage. They could have no savings, bad credit and still get this marvelous gift.

And no longer would the gift of mortgage be fixed at a special rate. It would be variable and be able to climb to any rate the bank wanted. These special mortgages were called Subprime and allowed the banks to make a lot of money on their mortgages.

And the people rejoiced and everyone went out to buy their home. But a strange thing started to happen. Homes that once were $60,000 or $70,000 were now being sold for $250,000, $400,000 or even $500,000. Builders started to build new homes and selling them for more than they were actually worth. But the people would scream "We want this house!" and the bank would give them the gift of mortgage.

But not all was right. A new President, George W. Bush, saw that this could become a problem. People with low incomes buying homes they really could not afford. And he tried to make it better. In the year 2003 he tried to move governmental supervision of Fanny Mae and Freddie Mac to a new agency created within the Department of the Treasury. But the evil Democrats who ruled the Congress said, NO!

Again voices were raised that Fannie Mae and Freddie Mac were not well. They tried to sound the alarm in the year of 2005. A group of Senators from the Congress, headed by John McCain, tried to heal the 2 children, but to no avail. For the evil Democrats said NO! IT WOULD HURT THE POOR. So nothing again was done.

Then came the bad year, 2007. What was warned about started to happen. The people who didn't have the good credit or the savings found that their gift of mortgage was not a very good gift. The payment that they owed each month was getting bigger and bigger, while their paycheck was getting smaller and smaller. And when they could not pay their mortgage to the bank, the bank took their house away.

This was happening to many people who cried to their President and Congress for help. But what did their Congress do? They just laughed. For Fanny and Freddie were sneaky children. They would give their friends in Congress many gifts and presents. Gifts of special mortgages (that the poor people could never get) and gifts of money. Some got many gifts. Dodd of Connecticut got $133,900, Obama of Illinois got $105,849, Pelosi of California got $32,750. And they did nothing for they wanted more gifts.

And then the crash came, August of 2008. The banks started failing and there was no one to give the gift of mortgage. For Fanny and Freddie were very, very ill. They couldn't save the banks or even themselves. And the Congress finally had to do something before they would die. But what did they do? They gave them more money. $700 trillion of the people's money they would give. It would help save the 2 children and give the banks a chance to live.

But them people who knew how the banks should have worked said please don't do this, it will do more harm than good. To give such a sum without government oversite, would only create the same conditions we now face.

So nothing is being done, and banks are failing. The people are still losing their homes, and all we get is the evil Democrats crying: IT'S JOHN MCCAIN'S FAULT!

IT IS NOT!

If you have like this little tale feel free to cross post it, just give me a link back to my site.




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