Financial Crisis Inquiry Commission – FCIC Needs to Recommend the Breaking up of Commercial and Investment Banking.
The Financial Crisis Inquiry Commission (FCIC) started hearings this week. I was reading through a report they put out examining financial market and economic data and it is fascinating that many of the charts we are seeing in the report are covering aspects that are largely being missed by the regular media. They cover the massive lopsided profits of the corporate banking sector and also examine the $11 trillion decline in household net worth. Ideally the FCIC will come out with real reform that will restructure the banking system in the U.S. and not get caught up with lightning rod issues like bonus payments. I am the first to agree that bonuses are downright disturbing given the bailouts these banks received yet the bonuses are merely the symptom, the not actual sickness.
The Capture of our Government by Wall Street: A 70 Percent Stock Market Rally lines up with an Additional 2.7 Million Jobs Lost since March of 2009. How Wall Street Reflects the Interest of the Corporatocracy and not the Real Economy.
It is a sight to behold that the stock market is rallying since the March 2009 low even though we have officially lost an additional 2,700,000+ jobs since that time. That is right, the system is so upside down right now that somehow nearly 3 million jobs lost is worthy of a nearly 70 percent rally in the S&P 500. I sit back and can only watch amazed as the stock market is converted into a full-fledge casino for the corporatocracy while the real economy is still hemorrhaging from multiple financial wounds. Even in the last headline unemployment reading, we lost 85,000 additional jobs and October job losses were revised upward from 111,000 to 127,000 yet the big focus was on the preliminary 4,000 job gain in November. This is what passes as news to rally the market in today’s market.
1.41 Million Americans Filed for Personal Bankruptcies in 2009 a jump of 32 Percent from 2008. More and More Average Americans Resorting to Bankruptcy even with Tougher Rules to File.
The employment report out on Friday just goes to show that the American economy is still struggling to create jobs for average Americans. In fact 85,000 more jobs were lost in December but that isn’t the biggest data point out of the report. The civilian labor force shrunk by a stunning 661,000 and that is really the only reason the unemployment rate is still at 10 percent. This economy that is still very much in a jobs recession has pushed more and more Americans into the ultimate economic distress equivalent of a SOS. Bankruptcies are soaring and in 2009 1.41 million Americans filed for personal bankruptcies, a jump of 32 percent from 2008.
What Isn’t Happening with the $3 Trillion Commercial Real Estate Market: Loans Falling and Vacancy Rates at Record Heights at 10 Percent.
With commercial real estate, you can learn a lot from what isn’t happening. We all know that the $3 trillion commercial real estate market is already taking a drubbing in terms of pricing. CRE prices are down over 40 percent from their peak elevated levels. Yet with commercial real estate you don’t have the typical headline grabbing stories of individuals being forced out of their homes in foreclosures. With CRE it is seen as a more calculated business move and those losing their shirts are those who should have known better. Now this is how things should be but the U.S. Treasury and Federal Reserve have already back stopped the entire banking system so implicitly, the failing of any real estate is now a direct burden to all taxpayers.