More Headlines … (A reprint of Vol. XVII, Art. 8 – Four years ago today.)
From The Associated Press – 10/14/08 – “U.S. Could Guarantee $ 2 Trillion For Banks”
– “WASHINGTON – The government may guarantee nearly $ 2 trillion in U.S. banks’ debt and deposit accounts for more than three years in an effort to break the crippling logjam in bank-to-bank lending. That’s the equivalent of about 20 percent of the national debt, which recently blew past $ 10 trillion, and roughly 14 percent of U.S. gross domestic product – the economy’s total output of goods and services.”
From the Long Beach Press Telegram – 10/15/08 – “Traffic drops at ports for imported goods”
– “The weak economy and high energy costs continue to play a role in our decline …” Port of Los Angeles executives said in a statement.
From Exim India – 10/15/08 – “Global meltdown impact on shipping projected to be ‘severe'”
– “Shipping is a service industry that lives off world trade and world trade is in decline now in every sector,” according to the Chairman of a ship financing company.
From Business Times – 10/15/08 – “Fed’s Yellin says US appears to be in recession”
– President Janet Yellin of the San Francisco Federal Reserve Bank said that there was no clear end in sight for the housing downturn that has helped precipitate the crisis in United States and global financial markets.
From Business Times – 10/15/08 – “Mitsui, K-Line to cut US container service”
– “Container shipments to the US are tumbling at their fastest pace in more than a decade as the housing market slumps. ‘Demand for cargo space from Asia to the US has decreased as US consumption has been dropping since the middle of last year,’ said Mr. Onuki.”
From Business Times – 10/15/08 – “Some shipping lines likely to become bankrupt: Faber”
– “There has been an acute and significant decrease in near-term demand for shipping capacity,” analysts at Macquarie Group reported. “The primary cause is a significant fall-off in general demand driven largely by companies’ fears to extend cash.”
From Business Times – 10/16/08 – “US industrial output posts biggest fall in 34 years”
– “WASHINGTON – US industrial production fell a sharp 2.8 per cent in September, the biggest decline since December 1974 … The Federal Reserve said in the report the September drop was exacerbated by Hurricanes Gustav and Ike, as well as a strike at aircraft maker Boeing.”
From Business Times – 10/16/08 – “US economy faces biggest threat: Bernanke”
– “By restricting flows of credit to households, businesses and state and local governments, the turmoil in financial markets and the funding pressures on financial firms pose a significant threat to economic growth,” Mr. Bernanke told the Economic Club of New York.
From American Shipper – 10/16/08 – “Transpacific carriers forecast flat volumes in 2009”
– “The housing and U.S. credit crunch, touching both consumer spending and business growth, is likely to constrain container volumes from Asia to the U.S. well into 2009.” – The Transpacific Stabilization Agreement
From The Journal of Commerce – 10/16/08 – “Peak season tanking on weak West Coast imports”
– “Imports in Long Beach plunged 15.8 percent compared to September 2007. Imports dropped 9 percent in Los Angeles and 5.7 percent in Oakland … Retailers have indicated recently that they are bracing for a weak holiday season as consumers have cut back on purchases of all but essential items.”
As disturbing as this news may be, not one of the above stories mentions the fact that the real cause of the international meltdown and the tailspinning economies is the severe unemployment crisis in the U.S. The effects of this crisis is widely and loudly bemoaned by the experts … the very insiders who’ve engineered the catastrophe. The victims meanwhile … the outsiders that are left holding the bag … are forced to stand by, without a voice, while the “tab” for the “U.S. banks’ debt and deposit accounts” is being tallied and presented to them. That’s right. The taxpayers are being forced to replace the money that has been pilfered from them.
In two weeks time the bailout bill has escalated from $ 700 billion to “nearly $ 2 trillion”, but will any of this money be used to create jobs? Of course not. That’s why the term “bailout” is used. The idea is to restore lending power to financial institutions so that desperate citizens will be forced to borrow again. It’s a vicious circle. The rich get richer and the poor get poorer.
Here’s another 10/16/08 headline from Business Times:
“New York staring at loss of 165,000 jobs”
– “NEW YORK – New York City Comptroller William Thompson said the city may lose as many as 165,000 jobs, including 35,000 in the financial industry, as the impact of the crisis spreads throughout the economy.”
We hear a lot about job losses and unemployment but never, never do we hear of any plans to create employment opportunities. Without gainful employment, remember, that newly-unemployed 165,000 is without buying power, and that consequent loss of buying power is at the root of our economic ills.
See that $ 2 trillion of our money that U.S. politicians are awarding Wall Street interests? Not a single benefit will come our way as a result of that asinine move. $ 2 trillion, however, could build the largest and most profitable fleet of container ships the world would ever see. These cost-effective, patented, Jones Act vessels would be built in restored U.S. shipyards … in a Manhattan-type Project … and would require the direct and indirect employment of millions of U.S. workers.
$ 2 trillion could easily fund the construction and modification of at least 100 U.S. shipyards where thousands of cost-effective container ships could be built by U.S. citizens, owned by U.S. citizens, and crewed by U.S. citizens. [And we’re blowing our money on a Wall Street bailout instead!!??]