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Today's
Stories
March 29 /
30, 2008
Patrick Cockburn
Iraqi
Police Refuse to Back Maliki's Attacks on Medhi Army
Robert Fantina
Iraq
Troika: McCain, Obama and Clinton
John Ross
AMLO, the Comeback Kid? Fighting the Privatization of Mexico's
Oil
Nelson P. Valdes
Cuba, the Beatles and Historical Context
Suzanne Baroud
The Great Lake of Gaza: a New Crisis in the Making
Carl Finamore
Misery at 35,000 Feet: Mergers Stall, Fares Soar, Services Slump
and Consumers Sour
Missy Beattie
Justice and the Monsters of War
Jeffrey St. Clair
Booked Up
Website of the Weekend
Hidden Iraq
March 28, 2008
Saul Landau
Growing
Dread About Iraq
Alan Farago
Other People's Money: the Chop Shop Economy
Peter Morici
Knocking Down False Economic Gods
Andy Worthington
Plight of the Uyghus: a Chinese Muslim's Desperate Plea from
Guantánamo
Felice Pace
Ashes of Lies: Why No One Trusts the US Forest Service
Peter Montague
Sierra Club Cleans House -- With Clorox!
Dave Lindorff
The Mumia Exception
March 27, 2008
Patrick Cockburn
Basra
Erupts
Binoy Kampmark
Free Market Apostates
Joanne Mariner
"Was George Washington a Terrorist?"
Norman Solomon
NPR News: National Pentagon Radio?
William S. Lind
Mars Only Knocks Once: a Prognosis for Iraq
John V. Walsh
Obama's Speech: a Touch of Bigotry?
Robert Weissman
How Things Work
Ron Jacobs
Meeting Charlie Ehlen
Ralph Nader
Put Impeachment Back on the Table
David Macaray
Court Rules Against Grocery Workers
John Borowski
Clearcutting the History of Forest Destruction
Website of
the Day
Going Out for an English
March 26, 2008
Stan Cox
The
Germs Next Door
Sharon Smith
Greed
Pays: Welfare on Wall Street
Anita Sinha / Jill Tauber
Dreams Turned into Rubble in New Orleans
Matt Vidal
So Much for the Self-Regulating Market
William S. Lind
Operation Cassandra
Joe Mowrey
The Audacity of Hypocrisy: Obama's Pandering to Israel
Dave Lindorff
Duck and Cover (Up): Hillary Under Fire
Ray McGovern
Frontline's War: Too Timid, Too Little, Too Late
Justin Smith
Why Race and Gender are Separate Issues
Sam Husseini
The Winter Soldier Hearings and Indy Media
Martha Rosenberg
Blood on Ice: Gentlemen, Pick Up Your Clubs
Michael Dickinson
Politicians as Dogs
Website of the Day
The Wal-Mart Virus: How the Infection Spread
March 25, 2008
Ishmael Reed
The
Crazy Rev. Wright
Corey D. B.
Walker
The Politics of Jeremiah Wright
Linn Washington Jr.
Racism in America and Other Uncomfortable Facts
Alan Farago
The Money Launderers: a Picnic for Wall St. Insiders
Vijay Prashad
A Glimmer of Hope From the Gulf Coast
Joshua Frank
A Silver Lining to the Bush Years?
Ralph Nader
How Public Servants Can Help End This War
David Rovics
If I Can't Dance: Why is the Left So Boring?
Peter Morici
America's Banks are Broken
Dave Zirin
Olympic Flames: China's Crackdown in Tibet
David Krieger
The Crisis in Tibet
Website of
the Day
Memorializing Iraq
March 24, 2008
Jeffrey St.
Clair
Blonde
Ambition: Hillary's Berserker Campaign for 2012
Peter Morici
Digging Out of the Recession
Uri Avnery
Two Americas
Wajahat Ali
First of the Mohicans: an Interview with Rep. Keith Ellison
Paul Craig Roberts
Inside the Shell Game
George Ciccariello-Maher
The Coming War on Venezuela
Stephen Lendman
Sami Al-Arian's Long Ordeal
Christopher
Brauchli
Possessing Someone Else's Country
Cat Woods
A Letter to Mom on Obama
Stacey Warde
Tax Burden
Dave Lindorff
The American Dead Hits 4,000, But Who's Counting?
Website of
the Day
Live from the Longest Walk
March 22 /
23, 2008
Ralph Nader
Bush
Blisters the Truth on Iraq
Nicole Colson
Can You Afford to Feed Your Family?
James Petras
The Cost of Unilateral Humanitarian Initiatives
Laura Carlsen
From Bombs to Markets: The Andean Crisis and the Geopolitics
of Trade
Greg Moses
Tolerance and the American Pulpit
Andy Worthington
Torture Stories Dog Guantánamo Trials
Michael Dickinson
Art on Trial
John Ross
Bush's Surge Hits Mosul
Missy Comley Beattie
Killer Economics
David Michael
Green
Happy Anniversary, America!
Ramzy Baroud
The Coming Uncertain War on Iran
Martha Rosenberg
Easter Egg Shells from Hell
Paul Watson
Evolution is Going to the Dogs in the Galapagos
Isabella Kenfield
Monsanto's
Raid on Brazil
James Murren
Logging v. Water in Honduras
Jacob Hornberger
Sex and the Immigration Officer
Kathlyn Stone
Ben Heine, Master of the Art of Resistance
Seth Sandronsky
Rethinking New Mexico's History
Kim Nicolini
Class, Gender and Abortion in Communist Romania
Jeffrey St.
Clair
Booked Up: What I'm Reading This Week
Poets' Basement
Wilson, Woods, Gibbons and Orloski
Website of
the Weekend
Merci, McCain!
March 21, 2008
Marleen Martin
Land
Behind Bars: the Hidden Casualties of America's "War on
Crime"
Peter Montague
Run
Your Car on Coal? Maybe Not
Saul Landau
Monroe's
Deadly Doctrine
Anis Hamadeh
Merkel in the Knesset
Jacob Hornberger
McCain's Al Qaeda Scare: Slip or Tactic?
Khalil Nakhleh
Al Nakba of 1948: How Long Will It Persist?
Adam Isacson
Colombia, Paramilitary Threats and Assassinations
Kenneth Couesbouc
Money for Nothing
Madis Senner
Will the Feds Underwrite the Stock Market?
Monica Benderman
The Costs of Freedom: What Are You Willing to Pay?
Website of the Day
Stop Foreclosures and Evictions
March 20, 2008
Damien Millet
/
Eric Toussaint
The
Triple Failing of the Big Private Banks
Mike Whitney
Winding
Up Bear
John Ross
What Do We Owe Iraq?
Dave Lindorff
Paying the Piper: the Bodies and Bills are Piling Up
Wajahat Ali
Pakistan on Fire
Jill Nagle
Memo to Sex Workers: Stop Financing Shock Journalism
Manuel Garcia, Jr.
Obama and the Psychic Auto-Shrink-Wrapping Called Race in America
Dan La Botz
Obama's Race Speech
Robert Weissman
Alternative Power: Shutting Down the API
Stella Dallas
/
Jennifer Matsui
Apostasy Now! Mamet, Enter Stage Right
Website of the Day
The Angry Monk
March 19, 2008
Patrick Cockburn
A
War of Lies
Robert Fisk
The Little Men and the Inferno
Jeff Taylor
Five Years of War in Iraq
Ed Ruggero
From Pinkville to Iraq: the Dark Anniversary of My Lai
Ron Jacobs
Who'll Stop the Rain?
Christopher
Fons
Obama Takes the Race Bait
Sherwood Ross
In Defense of Rev. Wright
Cynthia McKinney
An Urgent Crisis: Confronting America's Racial Disparities
Joshua Frank
The Kool-Aid That Kills
Robert Weissman
Monsanto's Genetic Food Gamble
Walter Brasch
It's a Welfare State--If You're Rich
Yifat Susskind
Iraqi Women Resist the Occupation
Andrew Wimmer
War Demands Its Due
Website of
the Day
Glimpses of Nature
March 18, 2008
David Price
The
Military "Leveraging" of Cultural Knowledge
Paul Craig
Roberts
The
Collapse of American Power
Tim Wise
Of National Lies and Racial America: Jeremiah Wright, Barack
Obama and the Unacceptability of Truth
Patrick Cockburn
One of the Most Disastrous Wars Ever Fought
Conn Hallinan
Afghanistan, a River Running Backward
James T. Phillips
Monsters: Past, Present and Wannabe
Uri Avnery
The Killing in Bethlehem
David Macaray
Could Wal-Mart Revive the Labor Movement?
Marjorie Cohn
Beware an Attack on Iran
Peter Zinn
Obama in New Orleans
Dan La Botz
The Economic Crisis, Labor and the Left
Monica Benderman
Where are We Going?
March 17, 2008
Pam Martens
The
Fed's Wall Street Dilemma
Sasan Fayazmanesh
The US, Iran and the Policy of Dual Containment
Nelson P. Valdés
The Imperial Branding of Simon Bolivar and the Cuban Revolution
Peter Morici
The Corrosive Consequences of the Trade Deficit
Wajahat Ali
Disrobing the Nine: a Conversation with Jeffrey Toobin on the
Supreme Court Since 9/11
Ronnie Cummins
Beyond Progressive Malpractice: Taking Down Big Pharma
Shaun Harkin
Saint Patrick's Day in Fortress America
Ali Khan
No Pardon for Musharraf
Robert Jensen
Beyond Peace
P. Sainath
Oh, What a Lovely Waiver!
Greg Moses
Jeremiah was a Bullhorn
Dr. Susan Block
Advice for Eliot Spitzer
Website of the Day
No Cowboys
March 15 /
16, 2008
Patrick Cockburn
How
to Destroy a Country in Five Years
Mike Whitney
Bearly
Alive: Investment Giant Rushed to ICU by Panicky Fed Chief
Ralph Nader
Of
Laws and Men
Robert Pollin
It's Still the Economy, Stupid
Diane Christian
The Poetics of Perversity: From Boccaccio to Spitzer
Wajahat Ali
Faking the Hood: a Conversation with Ishmael Reed
Tom Wright
/
Therese Saliba
Rachel Corrie's Case for Justice
Alan Farago
Back to Florida: Where Bushtime Began
Greg Moses
Raiding the Family Room in Texas
Michael Hudson
A Grand Global Bargain?
Martha Rosenberg
Why Hillary's Favorite Chicken Company is Eying China
John Goekler
Fourth Generation Warfare in a Fifth Generation Conflict
Uzma Aslam
Khan
A Letter to Barack Obama: Where's the Change, Barack?
Oren Ben-Dor
The Silencing of Gilad Atzmon
David Underhill
Mammon, Morals and the Mobile Tanker Deal
Fred Gardner
The Education of Eliot Spitzer
David Michael
Green
Why Spitzer Should Have Resigned (and Why He Shouldn't Have)
Rev. William E. Alberts
Jesus, Entombed in Heaven
Gail Dines
It's All About the John: Prostitution and Male Power
David Yearsley
Conducting, Anarchy and the Problem of When to Begin
Chris Clarke
Walking with Zeke: the Luckiest of Dogs
Poets' Basement
Anderson, Lodge & Subiet
Website of
the Day
Deviant Art
March 14, 2008
Paul Craig
Roberts
Watching
the Dollar Die
Don Santina
Vichy
Democrats: Pelosi and the Politics of Collaboration
Patrick Cockburn
Iraqi
Mother Vows Revenge on US: How She Lost Her Husband and Her Sons
Tim Rinne
StratCom
Rules! The Next War Will Start in Nebraska
Robert Fantina
In
Torture We Trust
Saul Landau
Letter
to the Presidents-in-Waitings
David Macaray
Common
Myths About Labor Unions
Franklin Lamb
Is
the Bush Administration Switching Horses in Lebanon
Michael Neumann
The
One State Illusion: Reply to My Critics
March 13, 2008
Paul Craig
Roberts
Republicans
and "Free Market" Zealots Bring Disaster to America
Mike Whitney
Meltdown
Looms Larger As Credit Markets Freeze
Assaf Kfoury
"One-State
or Two State?"- Sterile Debate on False Alternatives
Andy Worthington
Afghan
Hero Who Died in Guantánamo: The Background to the Story
Adam Federman
From
Autopia to Autogeddon: Cars Reach the End of the Road
March 12, 2008
Dave Lindorff
Bringing
Down Spitzer: It's the Big Brother Who Should Bother US
R.F. Blader
The
Spitzer Backlash
Yonatan Mendel
How
to be an Israeli Journalist. Never Write "Murder" or
"Palestine"
Jonathan Cook
One
State or Two? Neither. The Issue is Zionism
Bill and Kathy
Christison
Fallon
and Gates -- At Least One Cheer
James J. Brittain
Was
the U.S. Involved in Killing the FARC-EP Leaders
Ron Jacobs
"All
the Money You Make Will Never Buy Back Your Soul"
March 11, 2008
Paul Craig
Roberts
How
to End the Subprime Crisis
Ed O'Loughlin
How
Israeli Troops Invade Homes in Gaza, Brutalize, Smash and Steal
Ramzy Baroud
'Unwavering
Commitment' to Inequality
Kathy Christison
One
State or Two? The Debate Over Israel and Palestine
China Hand
PRC
Plays it Cool, as U.S. Tries to Amp Up Pressure on Iran
John Joslin
Thank
You, Nafta! Welcome to Weirton, Home of the Discount Cigarette
Mike Averko
Serb
Politics, Kosovo and the Moscow-Washington Divide
Ben Rosenfeld
Gavin
Newsom's Kneejerk Plan
Thierry Paquot
High
Rise, Low Spirits:The Curse of the Tower Block
March 10, 2008
Uri Avnery
"Kill
A Hundred Turks and Rest": The Five-Day War in Gaza
Col. Dan Smith
Scoring
the "Surge" and What Lies Beyond
R.F. Blader
Why
"Lock Them Up and Throw Away the Key" is Losing its
Sheen
Michael Neumann
The
One-State Illusion: More is Less
Bob Fitrakis
and Harvey Wasserman
Did
the Republicans Give Hillary Her Victory in Ohio?
James J. Brittain
Anti-Uribe
Protests in Colombia and the World
Missy Comley
Beattie
The
Passion of John McCain
March 8-9,
2008 Weekend Edition
JoAnn Wypijewski
The
Only Way to Fight the Clintons
Mike Whitney
Sorting
Through the Rubble in Post Bubble America
Peter Morici
Fed
and Treasury Fiddle as Economy Plummets
Ralph Nader
The
Silent Violence of Gaza's Suffering that Candidates Ignore
Jonathan Cook
The
Meaning of Gaza's Shoah
Steve Niva
Behind
the Israeli Escalation in Gaza
Bill and Kathy
Christison
Crisis
over Teheran's Alleged Nuclear Plans Nearing Climax
Hervé
Do Alto and Franck Poupeau
Bolivia:
Morales is Checked
Eric Walberg
To
Leave and Stay at the Same Time: Putin to Medvedev to…?
Scott Johnson
City
of A Thousand Foreclosures
Mark Scaramella
James
Brown's Gate
Bill Clinton
President
Clinton's Remarks on Naming William M. Daley as NAFTA Task Force
Chairman
Poet's Basement
St.
Thomasino, Engel, Davies and Willson
Website of
the Weekend
Hillary
Blackens Barack
March 7, 2008
Patrick Cockburn
Why
Iraq Could Blow-Up in John McCain's Face
Robin Blackburn
Question
for Barrack Obama: Why Afghanistan is the'Right War'?
Saul Landau
The
Stupid Economy
Binoy Kampmark
When
Competition is Good: McCain and the Muddled Democrats
Chris Floyd
Crushing
the Ants: Admiral Fallon and His Empire
Andy Worthington
Spanish
Drop "Inhuman" Extradition Request for Guantánamo
Britons
Will Potter
Before
the Smoke Even Clears in Seattle: Bringing Out the T Word
March 6, 2008
March 6, 2008
Vincent Navarro
The
Next Failure of Health Reform
Forrest Hylton
High Stakes in the Andes: Colombia's Cornered President
Peter Morici
Why the Dollar is So Cheap
George Ciccariello-Maher
Counter-Attack of the Bureaucrats
John Ross
Taxi! Taxi! The Dark Side of the Oscars
Jacob Hornberger
No Standing to Lecture on Justice
Paul Watson
Illegal Japanese Whaling by the Numbers
Dan Bacher
Off the Deep End
Website of the Day
A Katrina Reader Online
March 5, 2008
Cockburn /
St. Clair
A
Great Day for John McCain (and Maybe Nader)
Joanne Mariner
After Guantanamo
Fidel Castro
The Raid on Ecuador: Underestimating Rafael Correa
Christopher
Brauchli
The Turkish Invasions
Steven Sherman
Obama and the Prospects for a Renewal of the Left
Dave Lindorff
Busting Bush & Co. in New England
James Murren
Bombing Somalia
Adam Engel
Necropolis Now
Website of Day
Remember Song
March 4, 2008
Wajahat Ali
Mumbo
Jumbo: Naming Names with Ishmael Reed
William Blum
How Could Hillary Have Known?
Bill Quigley
The Cleansing of New Orleans
Ralph Nader
The Prince Harry Solution
Patrick Irelan
Oil and Health in Venezuela
James J. Brittain
/
R. James Sacouman
Uribe's Colombia is Destabilizing a New Latin America
Norman Solomon
The War Election
Jacob Hornberger
Hillary in Waco: the Missing Apology
Andy Worthington
Guantánamo and the European Parliament
Mike Averko
Kosovo and the Press
Website of the Day
Tex-Mex Primary
March 3, 2008
Jennifer Loewenstein
Gazan Holocaust
Alan Farago
American Politics and the Faltering Economy
Richard Gott
Colombian Deaths in Ecuador
Wajahat Ali
Who Speaks for a Billion Muslims? Analyzing the World Gallup
Poll with John Esposito
Paul Craig Roberts
The Mukasey Conspiracy: a Bi-Partisan Attack on the Constitution
Robert Weissman
When Multinationals Say Adieu
Uri Avnery
Good Morning, Hamas
Martha Rosenberg
When Your Meat is a Downer
Eva Liddell
Leave the Next Dance for Bill
Michael Donnelly
Will Ferrell Does Flint
Website of the Day
Muddy Waters: Train Fare Home Blues
March 1 / 2,
2008
Alexander Cockburn
The
Race Card
Paul Craig
Roberts
The
Political Trial of Don Siegelman
Kathleen and Bill Christison
Nader the Best Antidote to American Imperialism
Nelson P. Valdés
Cuba After Fidel
Christopher Brauchli
Meet Mr. Nursultan Nazarbayev: Friend of Bill, George and Dick
Ron Jacobs
Inside the Secret City: Bomb Making at Oak Ridge
John Ross
The New Conquistadores: Spain's Reconquest of Mexico
Robert Fantina
Posturing Over Patriotism: Obama and Those Lapel Pins
Robert Weissman
Hidden in Plain Sight: Human Rights Hypocrisy
Mohammed Omer
Fear in Gaza
Remi Kanazi
Barack Obama and the Politics of Xenophobia
Bob Jackson
Why is Yellowstone Destroying Its Bison Herd?
Richard Rhames
Casual Threats: Loaded with Mercury
Franklin Lamb
Lebanon Awaits the Arrival of the USS Cole
Rannie Amiri
Showboat Diplomacy: US Warships Steam Toward Lebanon
David Michael
Green
The Three Faces of Hillary: the Politics of Flim-Flam
Conn Hallinan
Notes from the Southern Cone
Faheem Hussain
Prince Harry of Afghanistan and the Meaning of Normalcy
Poets' Basement
Gibbons, Orloski, Gardner and Ford
Website of
the Weekend
The Palestine Chronicle Needs (and Deserves) Your Help!
February 29,
2008
Matt Gonzalez
The
Obama Craze
Jonathan Cook
Academic Freedom? Not for Arabs in Israel
Joshua Frank
Obama and Israel
Anthony DiMaggio
The Unilateral Presidency: Signing Statements and the Rollback
of American Law
Linn Washington, Jr.
Cop Abuse in America
Binoy Kampmark
Hubris and Nemesis
Robert Bryce
Energy Efficiency May be a Good Thing, But It Won't Cut Energy
Use
Sonja Karkar
Australia's Government Continues Its Love Affair with Israel
Dave Lindorff
A Manchurian Candidate in the White House? Obama or Bush?
Website of
the Day
Olduvai George
February 28,
2008
Patrick Cockburn
"Iraq"
Falls Apart
Fred Gardner
The Birth of NAFTA
Michael Levitin
The Crisis in Kosovo is Just Beginning
William S.
Lind
The Fake State of Kosovo
David Macaray
A Ray of Hope for Organized Labor
Stephen Fleischman
Nader's Latest Run: Monkey Wrench or Cattle Prod?
George Wuerthner
The Myths of Forest Health: Why Ecological Logging is an Oxymoron
Laura Carlsen
The North American Union Farce
Carl Finamore
Why the Delta-Northwest Deal Hasn't Taken Off
Michael Dickinson
The Day I Bombed the House of Commons
Website of the Day
Plane Stupid
February 27,
2008
David Rosen
Playing
the Race Card: Obama, Love Across the Color Line and Political
Dirty Tricks
Vijay Prashad
Bomber John: McCain and the 100 Year War
Harvey Wasserman
Incident at Turkey Point: Did Florida Go to the Radioactive Brink?
Andy Worthington
Guantánamo's Shambolic Trials: Pentagon Boss Resigns,
Ex-Prosecutor Joins Defense
Wajahat Ali
Pakistan for Sale: an Interview with Ayesha Siddiqa on Pakistan's
Military Economy
Peter Morici
The Auction-Rate Securities Fiasco: a Drama of Greed and Betrayal
Stephen Philion
Conspiracy Theory, Fears of Betrayal and Today's Anti-War Movement
Michael Donnelly
Obama by Unanimous Decision
Erica Rosenberg /
Janine Blaeloch
After the Land Deals: Will There
be Any Wilderness Left to Protect?
Website of
the Day
Dress Blues
February 26,
2008
Debbie Nathan
Confessions
of a Gitmo Guard
Alan Dershowitz
v. Frank Menetrez
On Finkelstein
Harvey Wasserman
How Ohio Got Nuked
Michael Colby
Ralph Nader vs. the Fundamentalist Liberals
Gary Leupp
Condi vs. Putin on Bullying Belgrade
David Orchard
The New Conquistadors: Canada in Afghanistan
Martha Rosenberg
The Big HRT
Fran Shor
The Electoral Circus and Nader's Sideshow
Serge Halimi
The Dom Perignon Socialist Manifesto: Bernard Henri-Levy's Plan
for the French Left
Global Balkans
Neo-Liberalism and Protectorate States in the Post-Yugoslav Balkans:
an Interview with Tariq Ali
Website of
the Day
Texistentialism
February 25,
2008
Roger Morris
A
Death in Damascus
Anthony DiMaggio
Military
Bases, the Media and the Democrats
Ralph Nader
Why I'm Running
Patrick Cockburn
Iraq Broils
Paul Craig Roberts
Kosovo and the Empire Crazies
Peter Morici
Bernanke's Failing Policies: a Long Recession Looms
Dave Lindorff
General Welch's Whitewash: What We Still Don't Know About That
Minot Nuke Incident
Saul Landau
/
Farrah Hassen
Fanatics, Mountebanks and Drillers: a Bloody Oil Film
Heather Gray
James Orange, Civil Rights Legend
Robert Weitzel
Accomodating Torture
John Halle
Kucinich Goes Down
Website of the Day
Do the Trunk Monkey!
February 23 / 4, 2008
Alexander Cockburn
The
Mushrooming Clouds That Hang Over McCain
Paul Craig
Roberts
Obama
and Global Trade
Wajahat Ali
Omissions of the Commission: an Interview with Phillip Shenon
on the 9/11 Commission
Ralph Nader
Neutering the FDA
Jürgen
Vsych
"What Was Ralph Nader Thinking?"
Fidel Castro
Watching the US Presidential Campaign from Havana
Andy Worthington
Britain's Guantánamo
David Macaray
Unions Under Assault
Jeremy Scahill
The Real Story Behind Kosovo's Independence
David Krieger
Stanley Sheinbaum
Caging the Cold War Monster
Ron Jacobs
Building for the Future
Michael Garrity
The Last, Best Hope for the Northern Rockies
Brian McKenna
Higher Ed's "Civic Engagements" Get Dumbed Down
Missy Beattie
Over the Hill with John McCain
Fred Gardner
American College of Physicians Takes Pro-Cannabis Stand (Mostly)
Boris Kagarlitsky
The Growth of the Russian Labor Movement
Mike Ferner
Kick That Barrel
Dan Bacher
On the Trail with the Border Angels
Christopher
Ketcham
Hillary Goes Where Obama Fears to Tread
Poets' Basement
Davies and Buknatski
Website of
the Weekend
Obama
Mariachi
February 22,
2008
Mike Whitney
The
Bonfire of Capital
Jason Hribal
Elephants and the Circus: The Story of Janet
Liaquat Ali Khan
Arresting Musharraf
Joshua Frank
That Obama Glow: the Nuclear Industry's Golden Child
Dave Lindorff
Vicki's John: Ask Not What She Did for Him, Ask What He Did for
Her!
Liliana Segura
When Torture is Old News: McCain's Blonde Diversion
Robert Fantina
Castro, Bush and Cuba: a Fiasco Waiting to Happen?
Yifat Susskind
The ABCs of Death: Bush vs. Africa's Women
Norm Kent
Pushing 60 with Pot
Website of
the Day
Bush Gets Down in Liberia
February 21,
2008
Saul Landau
Fidel
Steps Aside
Elizabeth Schulte
Left Behind, With No End in Sight: America's Long-Term Unemployed
Helen Redmond
Health Care as a Human Right
Benjamin Dangl
Undermining Bolivia
Michael Levitin
Kosovo's Dilemma
Liam Leonard
Fear and Loathing on the Emerald Isle
Patrick Irelan
Land and Food in Venezuela
Linn Cohen-Cole
Poor Ohio: a Second Letter to Hillary on Her Ties to Monsanto
Michael Simmons
Daydream Believer: John Stewart, the Miles Davis of Folk Music
CounterPunch
News Service
A Message from the Women of Okinawa to US GIs
Website of the Day
Cop Abuse in Shreveport
|
Weekend
Edition
March 29 / 30, 2008
Slip Sliding Away
Bernanke's
Next Big Bail Out Plan
By MIKE WHITNEY
The Federal Reserve is presently considering
an emergency operation that is so risky it could send the dollar
slip-sliding over the cliff. The story appeared in the Financial
Times earlier this week and claimed that the Fed was examining
the feasibility of buying back hundreds of billions of dollars
of mortgage-backed securities (MBS) with public money to restore
investor confidence and clear the struggling banks' balance sheets.
The Fed, of course, denied the allegations, but the rumors abound.
Currently the banking system is so clogged with exotic investments,
for which there is no market, it can't perform its main task
of providing credit to businesses and consumers. Bernanke's job
is to clear the credit logjam so the broader economy can begin
to grow again. So far, he has failed to achieve his objectives.
Since September, Bernanke has
slashed interest rates by 3 per cent and opened various auction
facilities (Term Securities Lending Facility, the Term Auction
Facility, the Primary Dealer Credit Facility, and the new Term
Securities Lending Facility) which have made $400 billion available
in low-interest loans to banks and non banks. He has also accepted
a "wide range" of collateral for Fed repos including
mortgage-backed securities and collateralized debt obligations
(CDOs) which are worth considerably less than what the Fed is
offering in exchange. But the Fed's injections of liquidity have
not solved the basic problem which is the fall in housing prices
and the persistent downgrading of mortgage-backed assets that
investors refuse to buy at any price. In fact, the troubles are
gradually getting worse and spreading to areas of the financial
markets that were previously thought to be risk-free. The credit
slowdown has also put additional pressure on hedge funds and
other financial institutions forcing them to quickly deleverage
to meet margin calls by dumping illiquid assets into a saturated
market at fire-sale prices. This process has been dubbed the
"great unwind".
In the last six years, the
mortgage-backed securities market has ballooned to a $4.5 trillion
dollar industry. The investment banks are presently holding about
$600 billion of these complex debt instruments. So far, the banks
have written down $125 billion in losses, but there's a lot more
carnage to come. Goldman Sachs estimates that banks, brokerages
and hedge funds will eventually sustain $460 billion in losses,
three times greater than today. Even so, those figures are bound
to increase as the housing market continues to deteriorate and
capital is drained from the system.
The Fed has neither the resources
nor the inclination to scoop up all the junk bonds the banks
have on their books. Bernanke has already exposed about half
($400 billion) of the Central Bank's balance sheet to credit
risk. But what is the alternative? If the Fed doesn't intervene,
then many of country's largest investment banks will wind up
like Bear Stearns; DOA. After all, Bear is not an isolated case;
most of the banks are similarly leveraged at 25 or 35 to 1. They
are also losing more and more capital each month from downgrades,
and their main streams of revenue have been cut off. In fact,
many of Wall Street's financial titans are technically insolvent
already. The Fed is the only force keeping them from bankruptcy.
Case in point: "Citigroup
may write down $13.1 billion of assets including leveraged loans
and collateralized debt obligations in the first quarter.....
U.S. bank earnings overall will tumble 84 percent in the quarter....``We
anticipate further downside to both estimates and stock prices''
because banks will be under pressure to mark down assets to reflect
falling market indexes." (Bloomberg News)
It's generally accepted that
the market for mortage-backed securities (MBS) will not improve
until housing prices stabilize, but that's a long way off. Mortgages
are the cornerstone upon which the multi-trillion dollar structured
investment market rests. And that cornerstone is crumbling. If
housing prices continue to fall, the MBS market will remain frozen
and banks will fail; it is as simple as that. No one is going
to purchase derivatives when the underlying asset is losing value.
The Bush administration is pushing for a "rate freeze"
and other clever ways to keep homeowners from defaulting on their
mortgages. But it's a hopeless cause. The clerical work needed
to change these complex mortgages is already proving to be a
daunting task. Plus, since 60 percent of these mortgages were
securitized, it is nearly impossible to change the terms of the
contracts without first getting investor approval.
Also, the tentative plans to
expand Fannie Mae and Freddie Mac, so they can absorb larger
mortgages (up to $729,000 jumbo loans) is putting an enormous
strain on the already-overextended Government Sponsored Enterprises
(GSEs; financial services corporations created by the United
States Congress. By attempting to reflate the housing bubble,
the administration will only increase the rate of foreclosures
and put the two mortgage behemoths at risk of default without
any clear sign that it will revive the market.
Yesterday's release of the
Case/Schiller Index of the 20 largest cities in the country,
shows that housing prices have slipped 10.7 per cent in the last
year while sales were down 23 per cent year over year. That means
that retail equity of US homes just took a $2 trillion haircut.
Still, prices have a long way to go before they catch up to the
50 percent decline in sales from the peak in 2005. From this
point on, prices should fall and fall fast; following a trajectory
as steep as sales. Many economists expect housing prices to drop
at least 30 per cent, which means that $6 trillion will be shaved
from aggregate home equity. In a slumping market, many homeowners
will be better off just "walking away" from their mortgage
instead of making payments on an asset of steadily decreasing
value. Who wants to make monthly payments on a $500,000 mortgage
when the current value of the house is $350,000? It's easier
to pack the kids and vamoose then waste a lifetime as a mortgage
slave. Besides, the Bush administration has no interest in helping
the little guy stay out of foreclosure. It's a joke. All of the
rescue plans are designed with just one purpose in mind; to save
Wall Street and the banking establishment.
The Fed chairman has simply
responded to events as they unfold. The collapse of Bears Stearns
came just weeks after the SEC had checked the bank's reserves
and decided that they had sufficient capital to weather the storm
ahead. But they were wrong. The bank's capital ($17 billion)
vanished in a matter of days after word got out that Bear was
in trouble. The sudden run on the bank created a risk to other
banks and brokerages that held derivatives contracts with Bear.
Something had to be done; Rome was burning and Bernanke was the
only man with a hose.
According to the UK Telegraph:
"Bear Stearns had total
(derivatives) positions of $13.4 trillion. This is greater than
the US national income, or equal to a quarter of world GDP -
at least in 'notional' terms. The contracts were described as
'swaps', 'swaptions', 'caps', 'collars' and 'floors'. This heady
edifice of new-fangled instruments was built on an asset base
of $80bn at best.
"On the other side of
these contracts are banks, brokers, and hedge funds, linked in
destiny by a nexus of interlocking claims. This is counterparty
spaghetti. To make matters worse, Lehman Brothers, UBS, and Citigroup
were all wobbling on the back foot as the hurricane hit.
"' Twenty years
ago the Fed would have let Bear Stearns go bust,' said Willem
Sels, a credit specialist at Dresdner Kleinwort. 'Now it is too
interlinked to fail.'"
Bernanke felt he had no choice
but to step in and try to minimize the damage, but the outcome
was disappointing. Bernanke and Secretary of the Treasury Henry
Paulson worked out a deal with JP Morgan that committed $30 billion
of taxpayer money, without congressional authority, to buy toxic
mortgage-backed securities from a privately-owned business that
was failing because of its own speculative bets on dodgy investments.
The only people who made out were the investors who were holding
derivatives contracts that would have been worthless if Bear
went toes up.
Still,the prospect of a system-wide
derivatives meltdown left Bernanke with few good options, notwithstanding
the moral hazard of bailing out a maxed-out, capital impaired
investment bank that should have been fed to the wolves.
It is worth noting that derivatives
contracts are a fairly recent addition to US financial markets.
In 2000, derivatives trading accounted for less than $1 trillion.
By 2006 that figure had mushroomed to over $500 trillion. And
it all can be traced back to legislation that was passed during
the Clinton administration.
"A milestone in the deregulation
effort came in the fall of 2000, when a lame-duck session of
Congress passed a little-noticed piece of legislation called
the Commodity Futures Modernization Act. The bill effectively
kept much of the market for derivatives and other exotic instruments
off-limits to agencies that regulate more conventional assets
like stocks, bonds and futures contracts.
Supported by Phil Gramm, then a Republican senator from Texas
and chairman of the Senate Banking Committee, the legislation
was a 262-page amendment to a far larger appropriations bill.
It was signed into law by President Bill Clinton that December."
("What Created this Monster" Nelson Schwartz, New York
Times)
The Fed chief is now facing
a number of brushfires that will have to be put out immediately.
The first of these is short term lending rates, which have stubbornly
ignored Bernanke's massive liquidity injections and continued
to rise. The banks are increasingly afraid to lend to each other
because they don't really know how much exposure the other banks
have to risky MBS. This distrust has sent interbank lending rates
soaring above the Fed funds rate to more than double in the past
month alone. So far, the Fed's Term Auction Facility (TAF; under
the Term Auction Facility (TAF), the Federal Reserve will auction
term funds to depository institutions) hasn't helped to lower
rates, which means that Bernanke will have to take more extreme
measures to rev up bank lending again. That's why many Fed-watchers
believe that Bernanke will ultimately coordinate a $500 billion
to $1 trillion taxpayer-funded bailout to buy up all the MBSs
from the banks so they can resume normal operations. Of course,
any Fed-generated scheme will have to be dolled up with populous
rhetoric so that welfare for banking tycoons looks like a selfless
act of compassion for struggling homeowners. That shouldn't be
a problem for the Bush public relations team.
The probable solution to the
MBS mess is the restoration of the Resolution Trust Corp., which
was created in 1989 to dispose of assets of insolvent savings
and loan banks. The RTC would create a government-owned management
company that would buy distressed MBS from banks and liquidate
them via auction. The state would pay less than full-value for
the bonds (The Fed currently pays 85 per cent face-value on
MBS) and then take a loss on their liquidation. "According
to Joseph Stiglitz in his book, Towards a New Paradigm in
Monetary Economics, the real reason behind the need of this
company was to allow the US government to subsidize the banking
sector in a way that wasn't very transparent and therefore avoid
the possible resistance."
The same strategy will be used
again. Now that Bernanke's liquidity operations have flopped,
we can expect that some RTC-type agency will be promoted as a
prudent way to fix the mortgage securities market. The banks
will get their bailout and the taxpayer will foot the bill.
The problem, however, is that
the dollar is already falling against every other currency. (On
Wednesday, the dollar fell to $1.58 per euro, a new record) If
Bernanke throws his support behind an RTC-type plan; it will
be seen by foreign investors as a hyper-inflationary government
bailout, which could precipitate a global sell-off of US debt
and trigger a dollar crisis.
Reuter's James Saft puts it
like this:
"It is also hugely risky
in terms of the Fed's obligation to maintain stable prices....
it could stoke inflation to levels intolerable to foreign creditors,
provoking a sharp fall in the dollar as they sought safety elsewhere."
(Reuters)
Saft is right; foreign creditors
will see it as an indication that the Fed has abandoned standard
operating procedures so it can inflate its way out of a jam.
According to Saft, the estimated price could be as high as $1
trillion dollars. Foreign investors would have no choice except
to withdraw their funds from US markets and move them overseas.
In fact, that appears to be happening already. According to the
Wall Street Journal:
"While cash continues
to pour into the U.S. from abroad, this flow has been slowing.
In 2007, foreigners' net acquisition of long-term bonds and stocks
in the U.S. was $596 billion, down from $722 billion in 2006,
according to Treasury Department data. From July to December
as jitters about securities linked to US subprime mortgages spread,
net purchases were just $121 billion, a 65% decrease from the
same period a year earlier. Americans, meanwhile, are investing
more of their own money abroad." ("A US Debt Reckoning"
Wall Street Journal)
$121 billion does not even
put a dent the $700 billion the US needs to pay its current account
deficit. When foreign investment drops off, the currency weakens.
It's no wonder the dollar is falling like a stone.
Mike Whitney can be reached at fergiewhitney@msn.com
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