Read carefully - the Washington Consensus has now been imposed on the US

[malaise]

All those morons who imposed these policies on developing countries will now understand Shock Therapy.
Naomi my sister, you are light years ahead of the rest of them.

http://www.imf.org/external/np/speeches/2008/092408.htm

<snip>
Direct intervention is the third line of defense. It has become obvious that direct fiscal intervention is going to be needed in the United States and elsewhere in order to attain the goals of removing distressed assets from financial institutions' balance sheets, and in recapitalizing the financial system where appropriate.

In this context, we welcomed the decisive actions taken by the U.S. authorities to shore up the GSEs, providing crucial support for the U.S. housing market, the banking system, and the broader economy. Over the longer term, a deep restructuring of the GSEs remains essential to restore market discipline, minimize fiscal costs, and limit systemic risks for the future. Ultimately the conflict of private ownership and public policy objectives within the GSEs' former business model needs to be resolved.

The challenge of removing distressed assets from financial institutions' balance sheets currently is front and center, with the US authorities' TARP proposal currently being examined by Congress. The discussions of the TARP have underscored the myriad difficult judgments that have to be made in order to make such a program a success. It is possible that similar challenges will be faced by other advanced economy authorities in the coming months. Earlier this year, the IMF proposed a solution based on long-term swaps of mortgage securities for government bonds. The advantage of such an approach is that it provides near-term relief for bank balance sheets, while ultimately leaving the underlying credit risk with the banks, rather than the taxpayers. In any case, the current discussions also have underscored the importance that moral hazard issues play in direct fiscal intervention in resolving financial sector crises.

More broadly, efforts aimed at alleviating systemic risks, including notably the provision of support to key financial institutions, will require sound judgment. For example, the current market strains to some degree reflect solvency risks. underscoring the need for a systematic and comprehensive approach to deal with distressed assets of failed institutions and in the financial sector more broadly.
-----------------
Things will get decidedly worse as they did in every country where these criminal policies were imposed. Reagan's policies have come home to roost. When this crashes as it will, the planet will sit down and realize that the stock markets have to go.

[jimshoes]

1. If they steal our money this time and we still end up in

a depression, those gated communities these thieves live in are going to be the second things that get trashed. And frankly I wouldn't want to be one of the monied few amidst millions of dispossessed angry former middle class people.

[soothsayer]

2. That's prolly why they're deploying an army brigade in the US for the first time ever

snip

They may be called upon to help with civil unrest and crowd control or to deal with potentially horrific scenarios such as massive poisoning and chaos in response to a chemical, biological, radiological, nuclear or high-yield explosive, or CBRNE, attack.

Training for homeland scenarios has already begun at Fort Stewart and includes specialty tasks such as knowing how to use the “jaws of life” to extract a person from a mangled vehicle; extra medical training for a CBRNE incident; and working with U.S. Forestry Service experts on how to go in with chainsaws and cut and clear trees to clear a road or area.

The 1st BCT’s soldiers also will learn how to use “the first ever nonlethal package that the Army has fielded,” 1st BCT commander Col. Roger Cloutier said, referring to crowd and traffic control equipment and nonlethal weapons designed to subdue unruly or dangerous individuals without killing them.

more at link
http://www.armytimes.com/news/2008/09/army_homeland_090708w/

So much for posse comitatus.

[malaise]

4. When people wake up and realize what was signed last night

there won't be enough security to deal with the anger. Forget all those piecemeal amendments. They have sold out big time. Watching politicians in the US is giving me flashbacks - I remember the same panic and drama when we were forced to sign the first IMF agreement. What I find interesting is that not one politician used the word IMF to the American public. Shock, shock, shock doctrine, shock, shock, shock therapy.

This is fucking madness.

[lostnfound]

9. Is that why they are assigning an army brigade stateside 3 days from now? nt

[malaise]

11. No doubt

but there are no guarantees. Those military men are also citizens.

[malaise]

3. Say goodbye to all credit

Here comes structural adjustment - divest, deregulate, devalue and die. The state must cut fiscal spending - health care(including public health) will get worse as will education, student loans, etc. Prices will rise even more than they are already rising.

Latin America has divorced itself from this madness and the US government signs on formally. You are collectively fucked, but the good news is that the population will finally wake up.

American people do not have a clue what was signed last night. IMF policies are nothing more than economic terrorism for ordinary citizens.

As an aside, hubby is a Stanford trained economist - PhD. He says the US has just fucked itself further.

add.

[avaistheone1]

18. The head of the Congressional Budget Office says the same thing. The bailout may well make things

worse. The head of the Dallas Federal Reserve agrees with the CBO head. The bailout is only a band-aid.

[malaise]

19. This only helps special interests

I've been anti-IMF for 30 years and all the data is on my side. This will only hurt the middle class and working class even more. This is fugged up beyond belief. There has got to be a better way than IMF policies.
This will not save jobs - there will be massive layoffs in the government sector and private sector.

[avaistheone1]

21. From what I understand it will only save about 5 major financial institutions like Goldman Sachs

and even then it just a stop gap measure.

I admit I don't know much about the IMF. I just did a quick tutorial at wiki, and it looks like the IMF causes more problems for many developing countries than it helps. The story about Jamaica was particularly disturbing.

[malaise]

22. Bingo this is a stop gap measure

We were told the same shit. Everything will collapse if you don't sign immediately. You devalue, you deregulate, you divest and you watch poverty grow and your standard of living decline. You watch fiscal cuts in health, education, jobs, name it while you watch income disparities widen. Then you watch your friends and relatives say fuck it as they pack up and leave. Meanwhile as poverty increases and local agriculture and industry die from imports, you watch crime rise and you build higher fences, add more grills to your windows and eventually hire a private security company to guard your property 24 hours a day. Of course the great fiscal cuts have reduced security guaranteed with your taxes as police stations are closed or collapse from lack of maintenance, or they don't have enough vehicles to respond to a call. Education deteriorates as better trained teachers head for a quick buck in the private sector or migrate as teachers' salaries cannot keep up with the cost of living and subventions to schools are reduced. Hungry students can't learn much and school meals are reduced in quality and quantity. Then you watch the rise in the sex industry. It's a fucking mess.
There's a great DVD out there on Jamaica - Life and Debt. Between 1976/77 and now our dollar moved from J$1.35 = US$1.00 to $US$1.00 = $77.00.

The IMF is economic terrorism and works for corporations and the financial conglomerates. Just Say NO!

[tomp]

10. i agree but then....

....there's this plan they have for suppression and/or imprisonment of the rabble rousers.

[lonestarnot]

14. Well, where are we going to dump all that fucking trash is the next question?

:evilgrin:

[malaise]

17. Here's a serious question

Did the US Congress approve this?
http://www.resourceinvestor.com/pebble.asp?relid=40743
25 Feb 2008 at 01:30 PM

Bloomberg reports: The U.S. Treasury has backed the International Monetary Fund’s (IMF) plan to sell some of its $98 billion in gold reserves to help make up for a decline in revenue. The IMF holds 103.4 million ounces of gold and has suggested the sale of as much as 14 million ounces.

David McCormick, Treasury's undersecretary for international affairs, that the Bush administration supported sales of as much as 12.9 million ounces recommended by Andrew Crockett, former head of the Bank of International Settlements, to set up an investment fund to cover anticipated losses at the IMF, McCormick said.

However, the U.S. Congress can block any sale of the reserves, since approval requires an 85% majority from the 185 countries that are members of the IMF. Congress blocked IMF attempts to sell gold in 2005 and 1999.

http://www.ifiwatchnet.org/?q=en/node/9099
8 Apr 2008
Late yesterday the IMF announced its plan to sell part of its gold reserves to finance its future operations. In an unusual (lucky?) turn of events, the U.S. board member to the Fund cannot give the gold sales a go-ahead without the approval of U.S. Congress.

Gold sales require approval from 85 percent of the voting shares at the Fund, which means it must have U.S. support. The U.S. Executive Director to the Fund cannot approve gold sales unless authorized by Congress first. Recognizing this strategic opportunity, U.S. civil society organizations are urging Members of Congress to require key policy changes at the IMF before approving gold sales.


http://in.reuters.com/article/businessNews/idINIndia-32142520080226

Congress had not passed this up to July - any info out there.

[halobeam]

20. interested in finding this out as well.....

[bvar22]

23. The REAL predators are beyond "Gated Communities".

They have already bought islands & foreign countries where they plan to live like royalty.

The Bush family has bought several square miles of Paraguay for their Tropical Get Away after the looting is complete. The good news is that Paraguay has elected a Leftist government to replace the Right Wing Bush supported Oligarchs, and the new government will be less inclined to protect the Bush War Criminals. :)

Unfortunatly, the Bushes, Cheneys, Rumsfelds etc. will be welcome to live in Saudi.
That option sorta appeals to me....banished to the barren desert where they will have wealth, but will always be 2nd class.
Rice and Powell(Black), Kissinger and Wolfie (Jewish) had better make other arrangements.

Only the low level Suckers will be left holding the bag in Gated Communities.
It won't be pretty.

[irislake]

5. Surely it's obvious to you now

that the Democratic party is complicit. I exempt Kucinich and one or two others. You is doomed!

[malaise]

6. Absolutely correct

They are all complicit.

[leftofcool]

7. Not only complicit, they are instigators

[malaise]

8. Not all of them but those who allowed

Bush to loot the treasury and failed to regulate financial institutions are complicit.

[malaise]

15. Any amendments will be temporary

From John Lipsky's speech -
Over the longer term, a deep restructuring of the GSEs remains essential to restore market discipline, minimize fiscal costs, and limit systemic risks for the future. Ultimately the conflict of private ownership and public policy objectives within the GSEs' former business model needs to be resolved.


Note - this is the line the right wing Rethugs are pushing.

[tomp]

12. this goes back decades and culpability is bipartisan.

with a few notable exceptions, like kucinich.

however, as much of a supporter of kucinich as i am, i have to say i've been disappointed with his support for obama in light of his (k's) statement of refusing to support any candidate using war as an instrument of foreign policy (or something like that). the debate showed me how close obama and mccain are on foreign policy. not only that, it was made ever clearer how interconnected all policies (domestic, foreign, financial, etc) are.

[malaise]

13. Good post

Obama's foreign policy is troubling but most of us really want to see the back of this criminal regime so he's getting a pass. One positive about this mess is that those IMF fiscal cuts will also have serious implications for military adventures.

add.

[tomp]

16. thanks, malaise! nt

[bvar22]

24. These people?

[malaise]

27. The Shrinking Influence of the US Federal Reserve

06/26/2008

Humiliation for Mr. Dollar: Ben Bernanke, the chairman of the United States Federal Reserve Bank, faces a general investigation by the International Monetary Fund. Just one more example of the Fed losing its power.

Another problem for Mr. Dollar is that it will be several months before his actions take effect. Officials with the International Monetary Fund (IMF) have informed Bernanke about a plan that would have been unheard-of in the past: a general examination of the US financial system. The IMF's board of directors has ruled that a so-called Financial Sector Assessment Program (FSAP) is to be carried out in the United States. It is nothing less than an X-ray of the entire US financial system.

As part of the assessment, the Fed, the Securities and Exchange Commission (SEC), the major investment banks, mortgage banks and hedge funds will be asked to hand over confidential documents to the IMF team. They will be required to answer the questions they are asked during interviews. Their databases will be subjected to so-called stress tests -- worst-case scenarios designed to simulate the broader effects of failures of other major financial institutions or a continuing decline of the dollar.


Under its bylaws, the IMF is charged with the supervision of the international monetary system. Roughly two-thirds of IMF members -- but never the United States -- have already endured this painful procedure.


For seven years, US President George W. Bush refused to allow the IMF to conduct its assessment. Even now, he has only given the IMF board his consent under one important condition. The review can begin in Bush's last year in office, but it may not be completed until he has left the White House. This is bad news for the Fed chairman.


http://www.spiegel.de/international/world/0,1518,562291,00.html

[OakCliffDem]

25. Kick

[malaise]

26. Emergency Economic Stabilization Act of 2008

Why does that title have such a nice "IMF" ring to it?

Let's keep it simple - from Wiki

Crisis stabilization

The term can also refer to measures taken to resolve a specific economic crisis, for instance an exchange-rate crisis or stock market crash, in order to prevent the economy developing recession or inflation.

The package is usually initiated either by a government or central bank, or by either or both of these institutions acting in concert with international institutions such as the IMF or the World Bank. Depending on the goals to be achieved, it involves some combination of restrictive fiscal measures (to reduce government borrowing) and monetary tightening (to support the currency).

Recent examples of such packages include Argentina's re-scheduling of its international obligations (where central banks and leading international banks re-scheduled Argentina's debt so as to allow it to avoid total default), and IMF interventions in South East Asia (at the end of the 1990s) when several Asian economies encountered financial turbulence.