Follow this link to a story and video of a recent get together of American people who are angry about how the world situation is unfolding.

I posted a comment about this story.

You can laugh this off as much as you like, but the parallels to the world history of the 1920s, 1930s, and 1940s are getting to be too much to ignore.

I’ll start you off with a few. I am sure you can fill in the rest.

Stock market excess and bubble economy with lax regulation.

Bubble bursts, market tanks, unemployment rises, home foreclosures skyrocket.

People get angry and look for scapegoats.

Now take it from there and fill in the rest of the story from whatever history of the 20s, 30s, and 40s that you have heard about..

Let’s just say that people who were raised in the 50s with a certain ethnic background were always warned to be on the look out for a repeat of this history.  Of course we knew our parents and grandparents were just worrying about nothing.  It’s amazing how much more well founded their worries look today than they did back then.

Obviously there are some people who are very frightened. Frightened people are apt to act irrationally.  I would love to hear some thoughtful, serious ideas on what we can do to head off this problem before it gets out of hand.

Can you channel people’s fears into productive action?

I’d be wary of any efforts to channel their actions in any way  that would add to their fear of scapegoats.

Follow this link to economist Joseph Stiglitz’s interview with Der Spiegel.

This is another pessimistic outlook from a Nobel Prize winning economist.

Follow this link to the complete video of President Obama’s Town Hall meeting in Strasbourg, France on April 3, 2009.

Follow this link to William Greider’s appearance on the Bill Moyers’ show.

Although they do not acknowledge the Taibbi article in Rolling Stone, ‘The Big Takeover’ (on AIG-Fin’l Products), I think they are confirming the worries that he raised.

The irony of not acknowledging the Taibbi story is that you really won’t understand Greider’s concerns unless you have read the Taibbi story.

I am now beginning to think that the real disservice that Paul Krugman has been doing in his criticism’s of President Obama’s bailout plans, is that Krugman has been too vague about what really concerns him.  By just claiming that Obama/Geithner are just furthering the Paulson plan of “Cash for Trash”, he has made it too easy to dismiss his criticisms.

Not until I read the Taibbi article did I start to get the picture of what the real problem is.   I was even fooled by the second half of the Charlie Rose Show of March 23. I blogged about this in The Pros and Cons of the Obama Rescue Plan.

I now see how I may have been taken in by the resignation letter of the AIG Financial Products Vice President. See my blog entry The Other Side of the AIG Bonuses Story. At least I was smart enough when I wrote the blog to say that I could not attest to the truthfulness of what was in the letter.  I called it food for thought.  I am beginning to think that this letter is not digestable.

I also ought to acknowledge that in one way or another, Richard H has been trying to tell me some of this stuff for years. I am really glad that he posted the blog item about the Taibbi story.  I also was too dismissive  of Richard H’s post Karl Denninger’s ‘Open Letter to the Ombudsman’ on the PPIP.

It is even getting to the point where I may actually have to pay attention to what Ron Paul has been saying.  He is the Republican Presidential Candidate in the last election whose main point was the damage that the Federal Reserve was doing to our country. I am not sure if he was right for the right reasons or right for the wrong reasons, but perhaps he was right.

Follow this link to the resignation letter of Jake DeSantis, an executive vice president of the American International Group’s financial products unit, to Edward M. Liddy, the chief executive of A.I.G.

As Paul Harvey used to say, “And now for the rest of the story.” Of course I cannot attest to the validity of this story any more than I could have attested to the validity of any of Paul Harvey’s stories. It is, however, food for thought.

Follow this link to find out how to submit your questions about the economy to President Obama.

If you have any doubts about the Presiden’t plans, now is the time to ask your questions.

The online town hall will be at 11:30 AM Eastern, the voting will close at 9:30 AM.

On March 23, Charlie Rose had a show discussing the pros and cons of the Obama bank rescue plan.

Follow this link to the video of the first half of the show.

Follow this link to the video of the second half of the show.

The first half of the show was with Andrew Ross Sorkin, Paul Krugman and Joe Nocera.  Sorkin and Nocera are mainly journalists.  Krugman is a Nobel Prize winning economist Professor at Princeton University and also a columnist for the New York Times.

The second half of the show was with Thomas F. Steyer – a San Francisco based founder of Faralon Capital Management whose clients are foundations and college endowment funds, and Daniel Alpert – Managing Director of Westwood Capital an investment bank in New York.

I happened to see the second half of the show live before I was able to view the video here of the first half.

Half way through watching the presentation by Krugman in the first half, I began to think that he really was ignoring a lot of the details of the Obama plan.  A lot of what Krugman said was refuted in the second half of the show by representatives of the types of investors that Obama’s plan hopes to entice into working this issue out.

The second half of the show explained why the Resolution Trust model for rescuing the Savings and Loans won’t quite work in this situation. Most of the S & L banks were fairly small and the problem was small enough to be manageable.  The current crisis involves some of the largest financial institutions around.

Contrary to Krugman’s assertions, the Obama plan is not to pretend that all banks can be made solvent again.  As explained in the second half, the idea is to make as many of the banks solvent again as is
possible.  Then whatever banks are left that must be put into receivership represent a small enough bundle that they can be handled like the S & L problem.

Even Andrew Sorkin fails to see the substantial difference between the Krugman plan and the Obama plan.  To use some leverage to accomplish with your money more than you could with 100% usage of cash is not a trivial difference and it is not smoke and mirrors.

Krugman does not seem to understand how the investment business operates.  He talks about having investors pay more for the assets than they are worth as if knowing what an asset is worth is a trivially
obvious thing to know.  As explained in the second half of the show, the worth of an asset to an investor crucially depends on the financing arrangements to buy the assets.  If the asset can be financed at a low interest rate, then you can afford to spend more for the asset and still make a profit.  Anybody who has been able to buy a more expensive house because of lower fixed rates on the mortgage interest knows that this is true.

Follow this link to a video of the complete news conference that President Obama held on March 24, 2009.

The final point that the President made is critical to keep in mind.

Like a giant ocean liner, turning a country around is not easy.  When the captain of the ocean liner wants to reverse course by having the helmsman turn the wheel, he doesn’t get discouraged if the ship has not turned around in a few minutes. He knows that it takes a long time to turn around. He keeps an eye on the change in  course.  As long as the course is changing in the desired manner, he keeps at it.

After the captain has made the initial steering correction, the ship stays pretty close to the original course for a very long time. However, the change in course is detectable to the officers in charge by reading the GPS instruments even if the passengers are unable to tell that there has been a change.

Do not look for the end results to appear tomorrow on the economy.  Do look for signs that the economy’s course is changing. Try to establish some reasonable thresholds that you will use to tell if reasonable progress is not being made.

I bet that long before your thresholds are violated, the President will already have taken steps to make needed corrections. If he hasn’t done so, then he will deserve all the criticism that you can heap upon him.  Even so, it would be better to suggest what he should do than to simply chastise him for what he hasn’t done.

or one person’s pork may be another person’s health food.

Follow this link to the article on Huffington Post.

Jindal thought that stimulus package spending  $140 million “for something called ‘volcano monitoring,'” was pork.

After the recent eruption of Mt. Redoubt in Alaska, the citizens near the mountain are very thankful for the advance warning they got from the volcano monitors.

It is easy to heap ridicule.  I wonder if Jindal will find it as easy to apologize.

All others who think they know pork when they see it, stop a minute, catch your breath, and actually think for yourself.

Having lived in Oregon for a dozen years in reasonably close proximity to Mt. Saint Helens and Mt. Hood, I know that people in different parts of the country have different concerns.  Others not faced with these threats have no appreciation for them.  That is why a Senator or Representative from a place may have better knowledge about real local threats than others who live far from that threat.

Follow this link to read Barney Frank’s response to Republican efforts to rewrite history.

At the very least, he shows that there is a record that might not fully accord with the Republican effort to lay all of the blame at Barney Frank’s feet.