Ramblings

At a time when our president and other politicians tend to apologize for our country’s prior actions, here is a refresher on how some of our former patriots handled negative comments about our country.
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JFK'S Secretary of State, Dean Rusk, was in France in the early 60's when DeGaulle decided to pull out of NATO. DeGaule said he wanted all US military out of France as soon as possible.
Rusk responded "does that include those who are buried here?
DeGualle did not respond.
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When in England, at a fairly large conference; Colin Powell was asked by the Archbishop of Canterbury if our plans for Iraq were just an example of empire building by George Bush.
He answered by saying, 'Over the years, the United States has sent many of its fine young men and women into great peril to fight for freedom beyond our borders. The only amount of land we have ever asked for in return is enough to bury those that did not return.'
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There was a conference in France where a number of international engineers were taking part, including French and American. During a break, one of the French engineers came back into the room saying 'Have you heard the latest dumb stunt Bush has done? He has sent an aircraft carrier to Indonesia to help the tsunami victims. What does he intended to do, bomb them?'
A Boeing engineer stood up and replied quietly: 'Our carriers have three hospitals on board that can treat several hundred people; they are nuclear powered and can supply emergency electrical power to shore facilities; they have three cafeterias with the capacity to feed 3,000 people three meals a day, they can produce several thousand gallons of fresh water from sea water each day, and they carry half a dozen helicopters for use in transporting victims and injured to and from their flight deck. We have eleven such ships; how many does France have?'
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A U.S. Navy Admiral was attending a naval conference that included Admirals from the U.S., English, Canadian, Australian and French Navies. At a cocktail reception, he found himself standing with a large group of Officers that included personnel from most of those countries. Everyone was chatting away in English as they sipped their drinks but a French a dmiral suddenly complained that, whereas Europeans learn many languages, Americans learn only English. He then asked, 'Why is it that we always have to speak English in these conferences rather than speaking French?'
Without hesitating, the American Admiral replied, 'Maybe it's because the Brit's, Canadians, Aussie's and Americans arranged it so you wouldn't have to speak German.'
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Robert Whiting, an elderly gentleman of 83, arrived in Paris by plane. At French Customs, he took a few minutes to locate his passport in his carry on.
"You have been to France before, monsieur?" the customs officer asked sarcastically.
Mr. Whiting admitted that he had been to France previously.
"Then you should know enough to have your passport ready."
The American said, 'The last time I was here, I didn't have to show it."
"Impossible. Americans always have to show your passports on arrival in France!"
The American senior gave the Frenchman a long hard look. Then he quietly explained, ''Well, when I came ashore at Omaha Beach on D-Day in 1944 to help liberate this country, I couldn't find a single Frenchmen to show a passport to."

Don’t let the financial pundits or even presidential candidates try to tell you the current financial problem is complicated. It’s simple: banks with lax or barely-existent credit standards gave mortgages to millions of people who could not afford them and then sold those bad mortgages to financial institutions that bundled them into various kinds of securities instruments that they bought and sold to one another many times over, raking in big commissions on every sale.

When home owners began defaulting on the loans they orginally could never repay, money, in the form of mortgage payments, disappeared and the securities instruments became valueless, leaving the banks with more debt than assets. (It's hard to finance a takeover with a bunch of empty houses no one can afford to buy.)

Of course, there are other factors

During the Great Depression in the 1930s, Congress passed the Glass-Steagill Act which created the Federal Deposit Insurance Corporation (FDIC), the organization that insures commercial bank accounts up to $100,000. It also separated banks into two types: commercial banks (the ones most of us use for our checking and savings accounts and personal, auto and home loans) while allowing investment banks – Merrill Lynch, Lehman Brothers, Bear Stearns, etc. – to operate with fewer restrictions and therefore make riskier financial deals with potentially bigger returns.

The argument for preserving Glass-Steagall (as written in 1987):

1. Conflicts of interest characterize the granting of credit – lending – and the use of credit – investing – by the same entity, which led to abuses that originally produced the Act

2. Depository institutions possess enormous financial power, by virtue of their control of other people’s money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.

3. Securities activities can be risky, leading to enormous losses. Such losses could threaten the integrity of deposits. In turn, the Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.

4. Depository institutions are supposed to be managed to limit risk. Their managers thus may not be conditioned to operate prudently in more speculative securities businesses. An example is the crash of real estate investment trusts sponsored by bank holding companies (in the 1970s and 1980s).

If you don’t count my mother who, in her old age, kept gold coins in tin cans around her house, Glass-Steagill restored confidence in the banks for our grandparents and parents, and it worked well for more than 60 years. By the time I was old enough for my own bank accounts, there was no question about their safety.

The argument against preserving the Act (as written in 1987):

1. Depository institutions will now operate in “deregulated” financial markets in which distinctions between loans, securities, and deposits are not well drawn. They are losing market shares to securities firms that are not so strictly regulated, and to foreign financial institutions operating without much restriction from the Act.

2. Conflicts of interest can be prevented by enforcing legislation against them, and by separating the lending and credit functions through forming distinctly separate subsidiaries of financial firms.

3. The securities activities that depository institutions are seeking are both low-risk by their very nature, and would reduce the total risk of organizations offering them – by diversification.

4. In much of the rest of the world, depository institutions operate simultaneously and successfully in both banking and securities markets. Lessons learned from their experience can be applied to our national financial structure and regulation.[12]


The repeal enabled commercial lenders such as Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities. [13]


Then in 1999, President Clinton signed the Gramm-Leach-Bliley Act which repealed Glass-Steagill. (You remember former senator Phil Gramm, don’t you? He was Senator McCain’s top economic campaign advisor until a couple of months ago when Gramm accused Americans of being whiners.)

What Gramm’s Act did was allow investment and commercial banks to consolidate, blurring the financial lines between them, leading to the same kinds of abuses that produced the Glass-Steagill Act in the first place - abuses that have resulted in the financial troubles we have today.

Unless the winner of the November election pushes Congress for more bank regulation (repeal of Gramm-Leach-Bliley would be a good start), I’m thinking I trust a coffee can under the bed more than any bank for the time being.

There is no telling how many Americans have been wiped out, or close to it, this week. As bad as it is for younger people, they have two or three decades to recoup. Old people, like Mildred, retirees who rely on small investment portfolios to supplement Social Security and the man who wrote me two weeks ago, do not.

But don’t expect any help. There is bail-out money – borrowed from China – but only for banks, along with golden parachutes for their executives who created this train wreck. The rest of us are on our own.

THE IRISH ARE SUCH CLEAR THINKERS:
THEY CAN'T FIGURE OUT WHY WE IN THE
U.S. ARE EVEN BOTHERING TO HOLD AN ELECTION. ON ONE SIDE, YOU HAVE A BITCH WHO IS A LAWYER, MARRIED TO A LAWYER, RUNNING AGAINST A LAWYER WHO IS MARRIED TO A BITCH WHO IS A LAWYER.

ON THE OTHER SIDE, YOU HAVE A WAR HERO MARRIED TO A GOOD
LOOKING WOMAN WHO OWNS A BEER DISTRIBUTORSHIP."
"THAT SHOULD BE NO CONTEST"