Financial Collapse

Everything old is new again. Current makes note of the growing belief that, in the era of postindustrial perma-recession, our sociopolitical structures increasingly resemble those that were found in feudalist societies —…

Ayn Rand was a godawful writer, and in ironic fashion her philosophy failed disastrously in her personal life. Yet decades after her death, her work’s destructive influence has never been stronger. The…

Mark Memmott for NPR:

Please allow us to mix a seriously serious subject — consumer protection — with a bit of fun.

As NPR’s Scott Horsley will report on All Things Considered today, President Obama is getting a lot of advice these days about whom he should name to head the new Consumer Financial Protection Bureau.

Actually, most of the advice is about whether he should or shouldn’t choose Elizabeth Warren, chair of the congressional panel that oversees the Troubled Asset Relief Program.

…The fun part of the story, though, is the “Elizabeth Warren rap video,” also known as Got A New Sheriff

Aren’t job losses and foreclosures as important as a “Ground Zero Mosque” (that isn’t a mosque, hasn’t been built or even at ground zero)? We know we live in hard times that…

When the New York Times runs a front page story suggesting that now is the time to buy gold and they quote Peter Schiff saying that paper money may become useless, is…

How easily we forget this whole mess started under a Democratic president, Bill Clinton, with the repeal of the Depression-era Glass-Steagall Act in 199. Here’s Huffington Post from a few months ago that sums up why a guy like this retiring is a big deal. Dan Froomkin writes:

He got it right last time.

Senator Byron Dorgan, Democrat of North Dakota, was one of eight senators who stood up to oppose the repeal of the Glass-Steagall act in 1999. That repeal, which was signed into law by President Clinton exactly 10 years ago today, broke down the barriers between commercial banking and investment banking, and led to the growth of behemoth financial firms that were able to take enormous risks with impunity, because they were “too big to fail.”

“I think we will in 10 years’ time look back and say we should not have done this,” Dorgan said back then. The video of his speech has become something of a cult favorite for wonks — ten years, a $700 billion bailout and a major financial crisis later.

Juan Cole writes on Informed Comment:

The world’s tallest building, Burj Khalifah or Khalifah Tower, was unveiled in Dubai on Monday:

Dubai is a finance hub, the bubble of which has burst, so the building’s opening now seems a critique of past excesses more than the triumph originally dreamed of. Now that Dubai is having to be bailed out by its oil-rich sister emirate, Abu Dhabi, the tower had to be named for its ruler Sheikh Khalifa bin Zayed Al Nahyan, rather than retaining its original name, Burj Dubai. Many critics have seen it as a monument to hubris likely to remain mostly empty, as the 21st century Tower of Babel.

As you can see, Dubai nevertheless went all out to celebrate the opening.

The Burj Khalifah is a symbol of everything wrong with our present moment. Rooted in a finance and real estate bubble, planned as big for the sake of bigness, opulent, now saved from disaster by Abu Dhabi’s unsustainable oil revenues, it casts its shadow on a nation of guest workers, many impoverished and exploited. If global warming proceeds at the pace some climate scientists fear, and the seas rise substantially, it may, ironically enough, be all that is visible of the low-lying United Arab Emirates a century from now.

Wow, this was on CNBC:

The dollar will get “utterly destroyed” and become “virtually worthless”, said Damon Vickers, chief investment officer of Nine Points Capital Partners.

“We don’t have resources. Neither does a lot of Asia to be quite frank,” Vickers said on CNBC’s Asia Squawk Box. “Countries that have resources — the Brazils, the Canadas, Australia — their currencies are doing well.” Vickers noted that their stock markets have done the best year-to-date.

“They have stuff. They’ve got resources. They export real things. The United States exports ‘promises’ and ‘pretty paper’,” he added.

Due to the huge wage disparities between the United States and emerging markets like China, Vickers said that may resolve itself in some type of a global currency crisis.

“If the global currency crisis unfolds, then inevitably you get an alignment of a global world government. A new global currency and a new world order, so we may be moving towards that,” he said.

Vickers added that this is the time where investors should be making money when the trend is developing. “Oil looks higher, gold looks higher, currencies look weaker.”