Goldman Sachs = US Govt & White House Is Dead Man Walking? (All Hail Dennis Kucinich - "Come Home America!")

Mish (Mike Shedlock) says If You're Not Petrified of Obama, You're Not Paying Attention and explains why Paul Krugman and Joe Stiglitz's economic prescriptions have been steadily avoided (like the plague) by Obama's financial con artists along with some other very controversial perceptions of what's actually going on (h/t to Marvin Gaye). (Read my whole essay if you have the time. It may be the most informative piece you've read since the panic started. Or maybe not if you're very well read.)

The green shoots story took a bit of hit this week between data on April retail sales, weekly jobless claims and foreclosures. But the whole concept of the economy finding its footing was "preposterous" to begin with, says Howard Davidowitz, chairman of Davidowitz & Associates."We're in a complete mess and the consumer is smart enough to know it," says Davidowitz, whose firm does consulting for the retail industry. "If the consumer isn't petrified, he or she is a damn fool." Davidowitz, who is nothing if not opinionated (and colorful), paints a very grim picture: "The worst is yet to come with consumers and banks," he says. "This country is going into a 10-year decline. Living standards will never be the same.""We're now in Barack Obama's world where money goes into the most inefficient parts of the economy and we're bailing everyone out," says Daviowitz, who opposes bailouts for financials and automakers alike. "The bailout money is in the sewer and gone." Bailout Money Wasted Davidowitz is correct about money going to the most inefficient parts of the economy. Bailing out AIG just so it can payoff Goldman Sachs is hardly a good use of taxpayer money. Nor is forcing a shotgun marriage between Bank of America and Merrill Lynch, only (n)ow have taxpayers pick up the tab. Please see Let the Criminal Indictments Begin: Paulson, Bernanke, Lewis for my take on the coercion Paulson used on Bank of America CEO Kenneth D. Lewis, pressuring Lewis to go along with a merger he clearly knew was not in shareholder best interests. Here is a snip from Geithner's Plan Can Succeed: "The Plan: Dump $500 billion of toxic assets onto unsuspecting taxpayers via a public-private partnership in which 93% of the losses are born by the taxpayer." Chrysler Hijacked . . . By propping up inefficient companies and keeping zombie banks alive, Davidowitz says "we are exactly on the same path as Japan," which is now two decades into its economic malaise."That's a big problem for the financial stability of the U.S.," says Davidowitz, who had a hard time envisioning an alternative to a very grim scenario for America: "With big government, mad borrowing, and not letting things fail, there's no way we can have [rising] living standards," he says. Ding, Ding, Ding we have a winner. I have talked about the Zombification of Banks on at least 12 occasions starting no later than March of 2008. FDR's policies prolonged Depression by 7 years UCLA economists calculate FDR's policies prolonged Depression by 7 years. Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt. . . . Without the policies, they contend that the Depression would have ended in 1936 instead of the year when they believe the slump actually ended: 1943.

Read the rest here. Jim Kunstler's site (actually his very wise readers) gets even more graphic for your further edification. This website is the latest and greatest if you want to follow the doings of the stock market and why you better.

This blogger, who posts as Tyler Durdan (recognize that moniker? First rule of Fight Club, no one talks about Fight Club) is relentless. There are some who say he is inside Goldman Sachs, that he has to be to be reporting the kind of stuff he reports. We also know that both Goldman and Morgan Stanley have come after him trying to find out who he really is. They have even answered Zerohedges charges in Bloomberg Press. The short version of what it all means IMO: Goldman Sachs is the trading arm of the US government OR The US Government IS GS and the rest of the financials. I don't think there is any other conclusion to reach. He follows charts. Even though financial stocks are up, trading volume has been low, most of it is the quants in computer trading. There are about 5 companies trading with each other jacking up the prices of stocks, waiting for you to buy them (worried you will be left out of the recovery), so that they can leave you holding the bags and short themselves on the way down when they decide to take their profits and quit holding the bag. It is all seeable in the charts. Guess which of your favorite companies has 5X more of the trading volume than anyone else in this "game?" Goldman Sachs. Guess who has over levered over 1000% against the assets they have on hand (derivatives)? Goldman Sachs. Guess where many of Obama's financial and government picks come from? Not his nose...Goldman Sachs. Tyler's Posts do an awesome job of exploring the ugly details of how it is done. When I first encountered these materials I was blown away. Some of you will yawn I am sure. As bad as we knew it to be, I fear it is way worse. Posted by: Babystepper

Jim Kunstler says we have been decoupled from reality (as half the banks failed the stress test), which is exactly what I thought and said (on this blog) was what the initial Bush/Paulson fake fear tactics foretold last October. To heighten the reality of what's really going on he uses the tale about what happened when the moment arrived to create better fly fishing. A "guru of angling" came up with a tactic for whipping up action in a trout stream to fool the trout into rising.

. . . This is famously the moment that drives trout crazy, and when it occurs en masse, with zillions of mayflies "hatching" off the water, a trout feeding-frenzy can ensue. The idea with the artificial hatch was to pitch a fake Hendrickson fly made of feathers and fur in so many furious, rapid casts that the dumb trout lurking below would get suckered into a feeding frenzy - and, shortly, into the buttered frying pan, with a nice "tuxedo" of cornmeal and bacon. In the annals of flyfishing, this gambit has been all but discredited, except among the mentally sub-normal who sometimes venture over from the lumpen realm of crank-and-plug fishing in search of improved social standing. But the tactic naturally transferred into the precincts of finance, where it reappeared in such disparate practices as Ponzi schemes and Keynesian "pump-priming." Now it is being employed at a scale never seen before, on an economy that is the equivalent of a great dead river poisoned by the toxic effluents of the same society that inhabits its banks (no pun intended). The dark secret of this river is that the fish who once ran there are all dead. Much has been made in recent weeks of "animal spirits" and the "psychology of markets" in the hopes that mere attitudes might overcome the laws of thermodynamics. Math wizardry has now yielded to self-esteem building, an understandable sequence of events, since trafficking in the mutant spawn of Wall Street algorithms has ended up completely demoralizing the United States of America. Sadly, this is a little like subjecting a man who has just watched his house burn down to twelve segments of Oprah shows about the triumphal secrets of weight loss. The Great Wish across America is to resume the life of comfort-and-convenience that seemed so nirvana-like just a few short years ago, when the very constellations of the heavens might have been renamed after heroic Atlanta realtors and Connecticut hedge fund warriors, and the boomer portfolios groaned with earnings, and millions of graying corporate salary mules dreamed of their approaching retirement to a satori of golf and Viagra, and the interior decorators grew so rich installing granite countertops that they could buy their own houses in the East Hampton, and every microcephalic parking valet in Las Vegas qualified for a bucket full of Ninja mortgages, and Lloyd Blankfein could dream of divorcing his wife to marry his cappuccino machine. The choices now are stark and the kind of life on offer by the future is rather austere. The job of the current president, and the people who work with him, is to manage an epic contraction - let's say, to land a very large, loaded defect-ridden airplane that has both run out of fuel and suffered grievous mechanical breakdown... and to bring down that vehicle in an unfamiliar country filled with angry savages. Sadly, the new president and his co-pilots just want to keep the plane up there, circling. The president's viziers are working round-the-clock to come up with some way, some toggle-switch, that might turn off the laws of gravity (which are not unrelated to the laws of thermodynamics). But all they seem to be able to come up with are mumbled prayers that are pale imitations of the algorithms once concocted by the Wall Street engineers who designed the aircraft they're riding in. Well, that's enough conceits and metaphors for today. We've digested the so-called "stress tests" for now with nary a burp and in a few weeks General Motors will step into the dark cave of bankruptcy. All the ancillary businesses linked to the US car-makers face contraction and annihilation. A couple of things occur to me which have not even entered the national debate on these matters: 1.) the US will still need to manufacture engines and chassis for military vehicles. Do we intend to send out to Mitsubishi for those things in the years ahead? 2.) the US will need rolling stock (i.e. choo-choo cars and engines) for a revived passenger railroad system. Do we intend to buy all that from the quaint peoples of other lands? (While the US workforce instead focuses on updated releases of Grand Theft Auto.) At the moment, there is tremendous hoopla and jubilation over the start-up of so many "shovel-ready" highway projects around America - as if what we need most are additional circumferential freeways to enhance the Happy Motoring lifestyle. How insane are we? Is this the only thing we know how to do? I remain confident that the months ahead will introduce the American public and our leaders to a range of horrors that will begin to penetrate our addled collective imagination. We're far from done with the crisis of banking and money and the related fiasco in mortgages - which translates into the very real situation of many people become homeless. It remains to be seen what may happen on the food production scene, but the current severe shortage of capital and the intense droughts shaping up around the world will resolve into a much clearer picture by mid-summer. The price of oil has resumed marching up and has now re-entered a range ($50-plus) that spun the airline industry into bankruptcy last time around. Enough carnage has already occurred on the jobs scene that the next act among many chronically jobless may tilt toward desperation, anger, and violence. The sporting goods shops around the nation are already rationing ammunition. It's not just the stock markets that have decoupled from reality as we enjoy the fragrant vapors of spring - it's the entire conscious consensus of everybody holding the levers of power and opinion. To put it as simply as possible, we're still sleepwalking into the future.

Our hero Dennis Kucinich has the only real long-term (and short-term) solution. Why is no one listening (still)?

"Get Out of Iraq. Get Out Afghanistan" "Come Home America" Information ClearingHousee Dennis Kucinich WASHINGTON - May 14 - Speaking on a Supplemental Appropriations bill that would continue to fund the wars in Iraq and Afghanistan, Congressman Dennis Kucinich (D-OH) today made the following statement: "America went to war against Iraq based on a lie. We were told back in 2002 that Iraq had weapons of mass destruction. The previous administration even pursued torture to try to extract false confessions in order to justify the war. It is time to tell the truth. The truth is we should not have prosecuted a war against the Iraqi people. The truth is the Democratic Senate could have stopped the Iraq war in 2002. The truth is we Democrats were given control of Congress in 2006 to end the war. The truth is this bill continues a disastrous war, which has cost the lives of thousands of our soldiers. The truth is the occupation has fueled the insurgency. The truth is the Iraq war will cost the American and the Iraqi people trillions of dollars and as many as a million innocent Iraqis have lost their lives as a result of this war. "Don't tell the American people that you are ending the war by continuing to fund the war. Don't tell the American people that the war will end when their plans leave 50, 000 troops in Iraq. Don't tell the American people that the way out of Afghanistan is to escalate our presence. "Get out of Iraq. Get out Afghanistan. Come home America."

Amen. Suzan ________________