nobel-winning stiglitz: crisis as bad or worse as great depression
from steve watson: Two time Nobel-prize winner and former chief economist of the World Bank, Joseph Stiglitz has warned that the current financial crisis will continue for at least another eighteen months and in many ways represents a worse situation than the one faced by Americans during the great depression of the 1930s. “You can paper things over for a while but eventually you have to face reality.”
gold soars over 8%
from reuters: U.S. gold futures rose 8 percent on Wednesday, soaring above $840 an ounce as investors poured into the gold market as a safe haven amid heavy losses in stocks and ongoing financial turmoil, traders said. The U.S. gold contract for December delivery was up $58.70, or 7.5 percent, at $839.20 an ounce at 11:55 a.m. EDT on the COMEX division of the New York Mercantile Exchange. The session high was $843.60.
soros compares mishandling of current crisis to great depression
from paul joseph watson: Billionaire investor George Soros has slammed US Treasury Secretary Hank Paulson for behaving in the same manner as bankers in the 1930’s and mishandling a financial crisis that threatens a repeat of the Great Depression. Soros told BBC Newsnight that the world was merely at the beginning of a financial storm and warned, “We mustn’t allow the financial system to collapse as it did in the 1930s.” Referring to Hank Paulson, the US Treasury Secretary, Soros stated, “The way Paulson is handling the situation is reminiscent of the way the bankers handled it in the 1930s.” ... Soros, a former member of the Board of Directors of the Council on Foreign Relations, is ranked by Forbes as the 99th richest person in the world with a net worth of around $9 billion.
fed to give aig $85b loan & take 80% stake
from iht: Acting to avert a possible financial crisis worldwide, the U.S. Federal Reserve Board reversed course Tuesday and agreed to an $85 billion bailout that would give the U.S. government an ownership stake in the troubled insurance giant American International Group. The decision, announced by the Fed only two weeks after the Treasury Department took over the quasi-government mortgage finance companies Fannie Mae and Freddie Mac, is the most radical intervention in private business in the central bank's history.
fed pumps $70b into financial system
from ap: Urgently trying to keep cash flowing amid a Wall Street meltdown, the Federal Reserve on Tuesday pumped another $70 billion into the nation's financial system to help ease credit stresses. The Federal Reserve Bank of New York's action came in two operations in which $50 billion and then another regularly scheduled $20 billion were injected in temporary reserves. The maneuver takes place as Federal Reserve Chairman Ben Bernanke and his central bank colleagues prepare to meet to decide their next move on interest rates and conduct a fresh assessment of the country's financial and economic troubles.
run on the bank? americans could lose their deposits
from paul joseph watson: You know things are bad when Yahoo.com, the most trafficked website in the world and usually a purveyor of mindless celebrity gossip, cooking tips and dating advice, features a top story about how Americans could lose their bank deposits following the collapse of Lehman Brothers. For the Internet giant to prominently report that there is already a “slow motion run on banks” is indeed a landmark event, and precludes even the most ignorant American from claiming they were not forewarned about the unfolding economic catastrophe. The article points out that although the Federal Deposit Insurance Corp. guarantees individual accounts up to $100,000, the FDIC fund only has about $50 billion to “insure” about $1 trillion in assets across the nation’s financial institutions. When Americans realize the fact that banks are “going to run out of money”, the article nonchalantly states, a run on the banks will accelerate.
does financial doom mean 'mad max' world?
from chris cope: Apparently the economy blew up over the weekend. Again. Like those 1960s Christmas lights that fire officials are always urging our grandparents to throw away, the stupid thing caught fire while no one was looking and now the holiday season is ruined. And by "holiday season," what I really mean is, "every stock market in the world."... We've got no money, we can't escape. It's all set to go horribly "Mad Max" at any moment. Pretty soon we'll start turning on each other like cable news hosts. I'm eyeing neighborhood cats as potential sources of food and furry winter socks.
wall st in worst loss since 9/11
from nytimes: In another unnerving day for Wall Street, investors suffered their worst losses since the terrorist attacks of 2001, and government officials raced to prevent the financial crisis from spreading. Trading opened sharply down Monday morning, and the mood later turned even gloomier, despite efforts by President Bush and Treasury Secretary Henry M. Paulson Jr., in separate appearances at the White House, to reassure markets that Wall Street’s deepening problems would not weaken an already anemic economy.
and then the rest of the terrible news from the last week or so...
US stocks drop, s&p500 sinks most since 9/11*
greenspan: this is the worst economy i’ve ever seen*
unemployment rate jumps to 5yr high*
global financial catastrophe*
US financial system in serious trouble*
fdic shuts down silver state bank of nevada*
mccain's son served on failed silver state bank's board until july*
ny will let aig borrow $20b from its own subsidiaries*
an aig accident could dwarf lehman's*
goldman sachs net plunges 70%*
financial elite deciding lehman’s fate during emergency meetings in new york*
lehman heads toward brink as barclays ends talks*
treasury confirms fannie, freddie takeover*
treasury seizes fannie & freddie to bolster housing market*
london stock exchange trading derailed by computer crash on frenzied day*
how an internet time warp blindsided united airlines*
fed holds emergency meeting on market developments*
daily show: the notorious aig
from truthdig: Whither Lehman Brothers? Et tu, Merrill Lynch? What’s going on on Wall Street? Jon Stewart breaks down the financial meltdown on Tuesday night’s edition of “The Daily Show”—complete with ’80s monster movie allusions.