Economic Security

The legislators are currently addressing the financial crisis confronting our nation and it appears that a consensus has been reached to bailout the Corporations from the burden of bad debts. According to the lawmakers, the “bill” is structured to largely benefit the taxpayers and assist with the stabilization of the financial market.

It is important to recognize the fact that the twenty first century economy is a global economy and the investments are tied to one another directly or indirectly and traded in the global markets. Therefore, it is vital for the U.S. economy to remain stable and provide necessary market assurance to both domestic and foreign investors with stakes in U.S. investments.

The other important factor for the unprecedented government intervention in a “free market” environment is to eliminate loopholes to avert such catastrophe in the future. When the actual agreement proposal is presented to the taxpayers, it should reflect the absolute protection of the taxpayer’s funds and profitable return on any investments.

At the same time, politics should not take precedence over “American taxpayers” interest in terms of “Appropriation of funds” for a certain political faction like “ACORN” or for that matter a “private sector” from the “Wall Street” with any misrepresentation to provide insurance on the “mortgage backed” securities with no prospective buyer in sight.

The “bill” must include provisions for full disclosure of the deals regardless of the nature and size of the bailout amount.

Further, it is essential for the “impending bill” to fund the bailout in “installments” rather than a lump sum settlement as it would indicate the initial results on the venture carried out on a “trial and error” basis. This would also allow public opinion to analyze the “pros and cons” of such investment and facilitate the required liquidity in the financial market with a “majority” approval.

The task ahead of our nation is to restore economic security with the revival of the “housing” and “job” market. As stated earlier, the “housing market” crisis is directly related to the “credit crunch” and “subprime mortgage” failure leading to “foreclosures” and that could be resolved by overhauling the lending practices and assisting the “homeowners” with affordable revised mortgage package. The foreclosed homes should be made available for sale to potential investors with verifiable income and credit history.

Commercial lending should resume freely yet carefully to promote and revitalize the small businesses and Corporations relying on credit for the growth and development in the job market. The flow of goods and services without any disruption will contribute to the anticipated growth and help the nation in reducing the multi-trillion dollar debt due to trade and budget deficit which otherwise will be the inevitable burden on the next and future generation.

It is time to focus on this crisis as “national” rather than “individual” and collectively deal with the issue for a better future of all.

Thank you.

Padmini Arhant

Middle East Conflict

Vadim said…

I feel the same way about Obama. You neglected to mention his shifting stance towards Israel (perhaps it’s not your issue). He used to meet with Edward Said and do activism in the Palestinian community here in Chicago. Now he says he’s been “pro-Israel” from the start.

FISA was the last straw for me. I’m going to vote third party unless he revokes his support for the bill: http://tinyurl.com/5w9w9v

I’m in Illinois so it likely won’t make a difference but I’m too disillusioned with Obama at this point to do otherwise.

August 14, 2008 1:44 PM

Hi Vadim,

Thank you for your comment.

“Palestinian” issue is a humanitarian issue.

I have raised my concerns recently in public regarding human rights violation and the challenges faced by “Palestinian” population for more than half a century now.

I see no difference between a Palestinian Mother and an Israeli Mother’s grief stricken images resulting from this ongoing conflict that could be resolved only if everyone involved could reach out to one another as human beings first and then anything next.

As a Mother, I can’t imagine the courage and emotional strength required for any mother to bury her own child or children before her time.

Giving birth to “life” is the most arduous and joyous journey for a mother. The aspiration to raise a child in a free and secure world and provide basic to affordable comforts is a common dream of any parents.

Only if the “sources” responsible for this conflict could realize that they have been gifted with “life” by a “mother” who is rewarded with a second chance to life during childbirth despite modern medicine and technology.

Every “life” is precious and should matter.

When I see a child in Palestine, Tibet, Burma or Darfur suffering and yearning for freedom, I see beyond their ethnicity. I see the human pain and agony. The hopelessness in their eyes that “darkness” will never be expelled from their “dreams” and yet forcing
a smile for the “international press” coverage on the carnage and destruction of their lives.

I have mentioned on numerous occasions in my blogs throughout the “Democratic Primary Election” on my.barackobama.com about the “Palestinian Plight” and the importance for international support and action to restore human rights and dignity for the “Palestinian People” and others mentioned above.

My website www.padminiarhant.com to be uploaded and active from August 19th, 2008 has a “Humanitarian” header dedicated to human rights issues concerning all human beings on earth.

I am also in the process of publishing my very first book titled “Words Matter”,
The Mind of a Blogger, subtitled “How Democracy is Hijacked during War and Election”?

I have sincere and genuine concern for people deprived of basic human rights and liberty to think and express as well as those struggling to establish a place they could call “Home” like in the case of “Palestinians.”

Once again, your thoughts are much appreciated.

Sincerely,

Padmini Arhant

August 15, 2008 5:57 PM

Economic Crisis

Our nation is currently experiencing a deep financial crisis due to major financial institutions, investment banks and insurance industry failure.

It all started crumbling like the house of cards beginning with Fannie Mae and Freddie Mac, Lehman Brothers, AIG and others in line with bad loans from the sub-prime mortgage crisis.

The economic meltdown in late 2006 precipitated nationwide housing market decline with saturated equity borrowing.

The entire network in the real estate and financial sector with hedge fund managers, underwriters, financial institutions processing the mortgage applications, mortgage brokers, realtors, homebuyers and sellers were primarily interested and vigorously involved in promoting and wrapping the deal with minimal and/or non-compliance of the standard rules and regulations that are specifically set up to avert such catastrophe.

The housing market bubble eventually burst contributing to credit crunch and massive foreclosures across the nation.

The commercial sectors were also hit in the process due to lenders streamlining measures and Congress legislation in an effort to slow down the escalating credit crisis.

Subsequently the ripple effect was felt in the job market with small businesses and medium size corporations struggling to maintain their credit limit from the sharp increase in interest rates on the borrowings and capital depletion essential for survival in the highly competitive market economy.

Meanwhile, some investors diverted their attention from real estate to stock market for short-term gains and as a result certain stocks earned the preferred status in stock value despite any performance history.

The stock market was warming up with superficially inflated stock prices along with futures trade speculation on oil stocks mostly responsible for the crude oil price elevation triggering the sensitive energy crisis.

At the top level, the monetary authority and incumbent administration as the economic growth and development oversight implemented policies including lowering of prime rates to an unprecedented level in recent times creating opportunities for financial institutions to outreach borrowers with no solid credit history.

The executive branch euphemism to display patriotism through home ownership factored for unscrupulous practices in the housing market debacle.

It has further come to light that some legislators are beneficiaries of personal financial deals as VIP PATRONS of the failed financial institutions such as Fannie Mae and Freddie Mac, Lehman Brothers and more.

However, it does not exclude Presidential contenders’ campaign advisors confirmed to be the financial institutions’ lobbyists/former executives enlarging the oversight conflict of interest.

Hence proving the theory….corruption and cronyism thrives in economic and political systems.

Strategy:

The government proposal to bail out these Corporations indulging in reckless undertakings with staggering $700 billion of American taxpayer’s money is currently debated in the House of Congress.

There is also anxiety over the executive branch cavalier approach for the clean bill immediate approval without tax payer investment protection or oversight for an unprecedented and historic venture.

The irony is the Treasury Department and the Federal Reserve Bank with the primary responsibility to monitor and recommend any regulation in the financial sector is experiencing labor pain after nearly twenty two months gestation and demanding Congress to deliver regardless.

With current Presidential race in process, one has to hope that this situation does not lead to the controversial Pro-Life vs. Pro-Choice debate on the financial crisis.

Congress favoring Pro-Choice to ensure the bearers safety and security would be prudent particularly with taxpayers bankrolling Corporations bailout and their erroneous decisions.

The urgency to regulate the financial sector granting unilateral authority to an individual – the Treasury Secretary with a sum approximately equivalent to Argentina and Chile’s combined GDP arouses legitimate skepticism among legislators on both sides of the aisle.

Some of them reminisce the current administration’s similar demand prior to invasion and occupation of Iraq.

Remedy:

Since the bailout is imminent and crucial for the stabilization of the financial markets, it is imperative for legislators to secure investments with conditional offers.

Several economists and experts have come forward and presented their thoughts and strategies for the existing national crisis.

1. The consensus among all of them is to establish an Independent Oversight with no Special Interests or Lobbyists infiltration posing conflict of interest.

2. Oversight Committee to approve after reviewing the proposal to invest in mortgage-backed securities to relieve the remaining financial institutions from the bad debts burden.

3. These securities purchase price carefully taken into consideration with a set profitable return upon instruments sale would be beneficial. It is also important to identify the buyers and sellers.

4. Open Bid transparency during investments’ sale or purchase is vital for investor confidence and value enhancement.

5. Corporate Executives pay off for poor judgment and weak performance eliminated as a precedence to existing and future Corporations heading in that direction would prevent repeat mistakes.

6. The hedge fund managers subjected to strict scrutiny and ethical standards is vital in addition to management fees and asset allocation determined in a manner to yield nothing less than profitable return to the investors i.e. the taxpayers.

7. Moratorium on foreclosures in bipartisanship agreement would relieve homeowners across the nation.

At the same time, the home owners to be evaluated on individual basis by the lenders with Oversight Committee alongside and encouraged to make payments equivalent to rental payments or interest only on revised mortgage package whatever is affordable.

Again, this offer made available only to the first home buyers dealing with foreclosures.

Successful sales and marketing of foreclosed homes to potential investors could expedite the housing market revival besides helping communities restore social and economic security through property taxes used for funding public school education and other services.

8. External audit on financial institutions listed as risky and brought to public focus would restrict undesirable activities.

9. The firewall resurrected between the commercial and investment banks protects public funds.

10. Sound and solid lending practices in both private and public sector would energize markets.

United States economy has proven record of accomplishments to rebound following crisis throughout the twentieth century.

The United States economy is resilient with a highly productive work force that has risen to the occasion and challenged the market forces acting against it.

The economic boom will resume and prosperity shared by the global markets.

The temporary turmoil in the market will be settled with prudent economic strategy, robust fiscal policy, leadership and confidence of the people of the United States of America.

Thank you.

Padmini Arhant

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