The Occupy Chicago crowd is now in their third week and have not stopped occupying the corner of Jackson and LaSalle yet. With the constant protesters, there is also a constant law enforcement presence, which to the Chicago Police Departmen’s credit, has remained civil, if not sympathetic – but they still have to enforce Chicago’s municipal code.

WE NEED YOUR STORIES!!

We (a writer friend and I) are putting together a compilation of stories from the recession. We would like you to submit stories of your triumphs over the recession or your defeat. We will read every story and put together a representative selection of stories and publish them in a book. If your story is included, you will receive a first edition of the book.

You can submit anonymously, but if you include your name, please notify us if you wish it to be withheld as author of the story. We request only your city and state.

Please submit stories to thisisamerica2010@gmail.com

Thanks, look forward to hearing from you.

note: Your stories will not appear on this or any other blog – only in the book

Poor school districts denied again

Today Gov. Quinn signed a law that would, according to his press release, require “the history of the United States taught in public schools reinforce the role and contributions of Hispanics.” It also requires that textbooks on American History include events such as “the forceful removal and illegal deportation of Mexican-American U.S. citizens during the Great Depression.”

Not mentioned, of course, is that they weren’t the only group deported or encouraged to deport. Also not mentioned was that there was a high proportion of illegal Mexican immigrants in that group we’ll soon learn about.

During the 1930’s 41% of the Mexican population returned to Mexico, voluntarily and involuntarily, but the number of Mexicans was only 236,000, compared to the much lower percentage of Germans who left, under the same conditions, yet produced a much higher number of actual departees. Only 23% of the Germans left but the number of actual people leaving was 371,000.

Perhaps Quinn should be sure to include that in his progressive law.

This same idea was proposed in California and Schwartzenagger vetoed it. He wanted general knowledge to be concentrated on. What a concept. That was what grade school was for. A good foundation. High school was to delve deeper into that foundation, general math to geometry, algebra, calculus.

Isn’t specialized study what college was for?

Teaching the Irish Famine is optional under the School Code, yet the famine Irish cleared the malarial swamps in Louisiana, built the “el,” the tunnels, laid the water and sewage pipes, dug the Sanitary Canal, etc. But again, their contributions are optional.

Forty-one percent of the Irish also left during the 1930’s. Same percentage as the Mexicans, under the same conditions. But we needn’t be sure our school children know that Europeans were targeted as well.

African-Americans escaped deportation because they were dragged here against their will, unlike Mexicans and Europeans who came voluntarily.

Personally, I’d rather have them teach us about every treaty Illinois signed with the Native Americans. I’d like to know which we violated and what reparations we gave the victims. I’d also like to know where the huge Native American population of Illinois went because we have no reservations but we had four or five tribes in Northern Illinois. Rogers Ave. in Rogers Park actually follows the treaty line with hte Pottawatomie Indians.

Did they leave the state voluntarily? I doubt it.

Can we put that in the history books Gov. Quinn?

Well, for the public school districts in Chicago and elsewhere, who don’t have current history books, I guess you’ll be missing out on this very important topic in your history classes.

I hope for their sake that they don’t have to answer questions about it on the ISAT test.That would be discriminatory in every sense of the word.

By the way Gov. Quinn, you signed a bill that cut the MAP funding for college kids in half, now you lobby to have it funded and blame its demise on the legislature. Isn’t that just a bit disingenuous?

At the same time that you are demanding the legislature fund the financial aid cut that you signed into law, you sign a bill into law that will cost the public school systems to replace their textbooks to fulfill this mandate.

We’re broke, guy. The Mexican history issue isn’t that critical, but being able to pay for college is. Where are your priorities? Would you have even considered this Mexican learning initiative if you weren’t running for reelection?

And Gov. Quinn, I would have preferred that you mandate that every single school in Illinois have current textbooks for their students, and enough textbooks for each child to have one, and that each and every school be in a building that has running water, bathrooms that work, and walls with intact paint.

You know, minor details that create an environment to learn.

America by the numbers – updated

1 in 10 Americans are on food stamps – average benefit – $112.82 per person

1 in 50 American children are homeless

3,000,000 Americans have been out of work 27 weeks or longer

5,000,000 Americans have lost their jobs since the “recession” started

8,600,000 American workers are underemployed

5,300,000 Americans are on unemployment, the highest number since 1967

Only 37% of unemployed workers qualify for unemployment benefits

Approximately 1 out of 3 homeless men are veterans

1 in every 466 U.S. housing units received a foreclosure filing in January

13,000,000 Americans are jobless

7 percent of homeowners with mortgages were at least 30 days late on their loans in February, up more than 50 percent from 2008

Banks closed 8 million credit card accounts in February

4.5 percent of total balances on bank-issued credit cards were at 60 days past due in February, up 32.7 percent from 2008

Welcome to the richest country in the world………

Bailing out investors won’t help the economy

Reuters led the story of yesterday’s stock market rally with the following:

Stocks rose on Wednesday, with the benchmark S&P 500 index attempting the first two-day advance in a month, as investors held out hope that Washington would restore confidence in banks by relieving them of money-losing assets.

This is a rather disingenuous conclusion to derive from the rally message. Investors don’t care about confidence in the banking system, they care about their toxic investment making money again.

Those that did not see this debacle coming, and did not get out of these investments in time, are hoping that the bailout will be big enough to allow then to recoup their losses.

Geithner is working on a plan to relieve the banks of their bad assets – at taxpayer expense of course.

But, according to Reuters, Geithner “promised action within weeks and said he was moving deliberately to minimize risks of losses for taxpayers.”

Minimize risks of losses for taxpayers.

And conversely maximize the potential of gains for investors?

Bailing out these insolvent big banks by buying their bad debt with our money, while leaving the current management in place that not only created the problem but grew filthy rich while they did it,  is just a crime.

I would say he has no vision of the future, when we the taxpayers have to pay for this, but then, he’s not a taxpayer, so why would he care?

Can you say depression, boys and girls?

Clinton, Rubin and Summers, Graham, Leach and Bliley – thank you

In the early 1900’s, commercial banks began to establish security affiliates that floated bond issues and underwrote corporate stock issues. (In underwriting, a bank guarantees to furnish a definite sum of money by a definite date to a business or government entity in return for an issue of bonds or stock.)

Then the stock market crashed.

In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market, FDR closed the banks for four days, 4000 failed permanently, and Congress created the Glass-Steagall Act of 1932, then amended it in the Banking Act of 1933.

The act forced a separation of commercial and investment banks by preventing commercial banks from underwriting securities, with the exception of U.S. Treasury and federal agency securities, and municipal and state general obligation securities.

More specifically, the act authorizes Federal Reserve banks to use government obligations and commercial paper as collateral for their note issues, in order to encourage expansion of the currency. Banks can also offer advisory services regarding investments for their customers, as well as buy and sell securities for their customers. However, information gained from providing such services cannot be used by a bank when it acts as a lender.

Likewise, investment banks cannot engage in the business of receiving deposits.

A bank is defined as an institution organized under the laws of the United States, any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, or the Virgin Islands, that both accepts demand deposits (deposits that the depositor may withdraw by check or similar means for payment to third parties or others) and is engaged in the business of making commercial loans (12 U.S.C.A. § 1841 (c)(1) [1988]).

Investment banking consists mostly of securities underwriting and related activities; making a market in securities; and setting up corporate mergers, acquisitions, and restructuring. Investment banking also includes services provided by brokers or dealers in transactions in the secondary market. A secondary market is one where securities are bought and sold subsequent to their original issuance.

It also created the Federal Deposit Insurance Corporation (FDIC) to protect depositors in the future.

The Act was passed because it was largely believed, after hearings in Congress, that commercial banks were being too speculative in the pre-Depression era, not only because they were investing their assets but also because they were buying new issues for resale to the public. Thus, banks became greedy, taking on huge risks in the hope of even bigger rewards. Banking itself became sloppy and objectives became blurred. Unsound loans were issued to companies in which the bank had invested, and clients would be encouraged to invest in those same stocks.

Enter the Clinton Era and the Graham-Leach-Bliley Act of 1999, the act which ultimately repealed the Glass-Steagull Act. The final bi-partisan version passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999, though most of his Democratic colleagues voted against it, initially (Senate 54-44, House 343-86).

The Graham-Leach-Bliley Act sought to “modernize” financial services–that is, end regulations that prevented the merger of banks, stock brokerage companies, and insurance companies. It nullified all prior acts that strictly regulated those who stored your money such as the Bank Holding Company Act that prohibited a bank from controlling a non-bank company which passed in 1956 and the 1982 amendment that further forbid banks from conducting general insurance underwriting or agency activities.

Why is this related to today? According to the Online Law Encylopedia,

The expansion of commercial banks into securities underwriting was substantial until the 1929 stock market crash and the subsequent Depression. In 1930 the Bank of the United States failed, reportedly because of activities of its security affiliates that created artificial conditions in the market.

As a result of the bank closings and already devastated economy, public confidence in the U.S. financial structure was low.

Is this sounding at all familiar? It should be.

The Glass-Steagull Act made all of that history, GLBA repealed it and history, my friends, is repeating itself.

*****************************************************************************************************************

Fast forward to October 2011 – With unemployment remaining steadily at over 9 percent for the last several years, foreclosures at an all time high and banks squeezing the dimes out of people with fees for everything but walking in the door, groups around the country are occupying financial districts, parks, banks and anywhere they believe they will have an impact. In New York occupiers shut down the Brooklyn Bridge and in Chicago they have been camped out for a couple of weeks on a corner that conveniently houses the Board of Trade, the Federal Reserve Bank of Chicago and Bank of America down the street. A recent rally joined by four other groups including several labor unions, shut down Monroe Street between Michigan and Columbus — ironically on Columbus Day.

Sources GLBA, Glass-Steagull(1), Glass-Steagull(2)

So why are we asking the experts anything?

NABE, the National Association of Business Economists, today released the results of their annual member survey. Reuters reports they predicted “the recession-hit economy would begin to recover in the second half of this year, returning to a potential growth trend in 2010.”

I wondered who these people were, and if they were the same people that missed this economic problem altogether, and were wondering for a year or two if we “might” be in a recession.

I found another survey summary that led to the current question, the topic of this entry. What do you think? Here’s what NABE says of its members:

Substantial percentages of economists report little familiarity with complex instruments and other financial innovations. Despite the prevalence of NABE members holding advanced degrees in economics and other business-related disciplines, substantial percentages admitted to having little or no familiarity with the structure, activities, and risks associated with hedge funds (45%), private equity funds (40%), asset-backed securitization (48%), credit default swaps (CDS, 68%) and collateralized debt obligations (CDOs, 51%).

That was in August 2007, when they also thought:

The five-year housing outlook remains largely positive. A slight plurality (42%) of respondents expects U.S. home prices to be flat, on average, over the next five years. But respondents who expect home prices to rise on average over the next five years (41%) far outnumber those who expect prices to fall (16%). NABE members continue to place low odds (1 in 10) on a large drop in U.S. home prices similar to that experienced in Japan during the 1990s.

No comment.

%d bloggers like this: