And, Saturday is usually such a quiet news day!
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Russian analyst predicts decline and breakup of U.S.
24/11/2008 19:31 MOSCOW, November 24 (RIA Novosti) - A leading Russian political analyst has said the economic turmoil in the United States has confirmed his long-held view that the country is heading for collapse, and will divide into separate parts.
Professor Igor Panarin said in an interview with the respected daily Izvestia published on Monday: "The dollar is not secured by anything. The country's foreign debt has grown like an avalanche, even though in the early 1980s there was no debt. By 1998, when I first made my prediction, it had exceeded $2 trillion. Now it is more than 11 trillion. This is a pyramid that can only collapse."
The paper said Panarin's dire predictions for the U.S. economy, initially made at an international conference in Australia 10 years ago at a time when the economy appeared strong, have been given more credence by this year's events.
When asked when the U.S. economy would collapse, Panarin said: "It is already collapsing. Due to the financial crisis, three of the largest and oldest five banks on Wall Street have already ceased to exist, and two are barely surviving. Their losses are the biggest in history. Now what we will see is a change in the regulatory system on a global financial scale: America will no longer be the world's financial regulator."
When asked who would replace the U.S. in regulating world markets, he said: "Two countries could assume this role: China, with its vast reserves, and Russia, which could play the role of a regulator in Eurasia."
Asked why he expected the U.S. to break up into separate parts, he said: "A whole range of reasons. Firstly, the financial problems in the U.S. will get worse. Millions of citizens there have lost their savings. Prices and unemployment are on the rise. General Motors and Ford are on the verge of collapse, and this means that whole cities will be left without work. Governors are already insistently demanding money from the federal center. Dissatisfaction is growing, and at the moment it is only being held back by the elections and the hope that Obama can work miracles. But by spring, it will be clear that there are no miracles."
He also cited the "vulnerable political setup", "lack of unified national laws", and "divisions among the elite, which have become clear in these crisis conditions."
He predicted that the U.S. will break up into six parts - the Pacific coast, with its growing Chinese population; the South, with its Hispanics; Texas, where independence movements are on the rise; the Atlantic coast, with its distinct and separate mentality; five of the poorer central states with their large Native American populations; and the northern states, where the influence from Canada is strong.
He even suggested that "we could claim Alaska - it was only granted on lease, after all."
On the fate of the U.S. dollar, he said: "In 2006 a secret agreement was reached between Canada, Mexico and the U.S. on a common Amero currency as a new monetary unit. This could signal preparations to replace the dollar. The one-hundred dollar bills that have flooded the world could be simply frozen. Under the pretext, let's say, that terrorists are forging them and they need to be checked."
When asked how Russia should react to his vision of the future, Panarin said: "Develop the ruble as a regional currency. Create a fully functioning oil exchange, trading in rubles... We must break the strings tying us to the financial Titanic, which in my view will soon sink."
Panarin, 60, is a professor at the Diplomatic Academy of the Russian Ministry of Foreign Affairs, and has authored several books on information warfare.
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Lawmakers in 20 states move to reclaim state sovereignty
Obama's $1 trillion deficit-spending 'stimulus plan' seen as last straw
Posted: February 06, 2009
11:50 pm Eastern
By Jerome R. Corsi
 Oklahoma Republican state Sen. Randy Brogdon |
So far, eight states have introduced resolutions declaring state sovereignty under the Ninth and Tenth Amendment to the Constitution, including Arizona, Hawaii, Montana, Michigan, Missouri, New Hampshire, Oklahoma and Washington.
Analysts expect that in addition, another 20 states may see similar measures introduced this year, including Alaska, Alabama, Arkansas, California, Colorado, Georgia, Idaho, Indiana, Kansas, Nevada, Maine and Pennsylvania.
"What we are trying to do is to get the U.S. Congress out of the state's business," Oklahoma Republican state Sen. Randy Brogdon told WND.
"Congress is completely out of line spending trillions of dollars over the last 10 years putting the nation into a debt crisis like we've never seen before," Brogdon said, arguing that the Obama stimulus plan is the last straw taxing state patience in the brewing sovereignty dispute.
"This particular 111th Congress is the biggest bunch of over-reachers and underachievers we've ever had in Congress," he said.
"A sixth-grader should realize you can't borrow money to pay off your debt, and that is the Obama administration's answer for a stimulus package," he added.
The Ninth Amendment reads, "The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people."
The Tenth Amendment specifically provides, "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."
Brogdon, the lead sponsor of the Oklahoma state senate version of the sovereignty bill, has been a strong opponent of extending the plan to build a four-football-fields-wide Trans-Texas Corridor parallel to Interstate-35 to Oklahoma, as WND reported.
Rollback federal authority
The various sovereignty measures moving through state legislatures are designed to reassert state authority through a rollback of federal authority under the powers enumerated in the Constitution, with the states assuming the governance of the non-enumerated powers, as required by the Tenth Amendment.
The state sovereignty measures, aimed largely at the perceived fiscal irresponsibility of Congress in the administrations of Bill Clinton and George W. Bush, have gained momentum with the $1 trillion deficit-spending economic stimulus package the Obama administration is currently pushing through Congress.
Particularly disturbing to many state legislators are the increasing number of "unfunded mandates" that have proliferated in social welfare programs, such as Medicare and Medicaid, in which bills passed by Congress dictate policy to the states without providing funding.
In addition, the various state resolutions include discussion of a wide range of policy areas, including the regulation of firearms sales (Montana) and the demand to issue drivers licenses with technology to embed personal information under the Western Hemisphere Travel Initiative and the Real ID Act (Michigan).
Hawaii's measure calls for a new state constitutional convention to return self-governance, a complaint that traces back to the days it was a U.S. territory, prior to achieving statehood in 1959.
"We are trying to send a message to the federal government that the states are trying to reclaim their sovereignty," Republican Rep. Matt Shea, the lead sponsor of Washington's sovereignty resolution told WND.
"State sovereignty has been eroded in so many areas, it's hard to know where to start," he said. "There are a ton of federal mandates imposed on states, for instance, on education spending and welfare spending."
Shea said the Obama administration's economic stimulus package moving through Congress is a "perfect example."
"In the state of Washington, we have increased state spending 33 percent in the last three years and hired 6,000 new state employees, often using federal mandates as an excuse to grow state government," he said. "We need to return government back down to the people, to keep government as close to the local people as possible."
Shea is a private attorney who serves with the Alliance Defense Fund, a nationwide network of about 1,000 attorneys who work pro-bono. As a counter to the ACLU, the alliance seeks to protect and defend religious liberty, the sanctity of life and traditional family values.
Republican state Rep. Judy Burges, the primary sponsor of the sovereignty resolution in the Arizona House, told WND the federal government "has been trouncing on our constitutional rights."
"The real turning point for me was the Real ID act, which involved both a violation of the Fourth Amendments rights against the illegal searches and seizures and the Tenth Administration," she said.
Burges told WND she is concerned that the overreaching of federal powers could lead to new legislation aimed at confiscating weapons from citizens or encoding ammunition.
"The Real ID Act was so broadly written that we are afraid that it involves the potential for "mission-creep," that could easily involve confiscation of firearms and violations of the Second Amendment," she said.
Burges said she has been surprised at the number of e-mails she has received in support of the sovereignty measure.
"We are a sovereign state in Arizona, not a branch of the federal government, and we need to be treated as such, she insisted.
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Fed borrowing could reach $4 trillion
Welfare spending, unemployment balloon deficit
Posted: February 06, 2009
11:50 pm Eastern
By Jerome R. Corsi
 U.S. Treasury |
The record federal debt financing is required to fund the social welfare programs called for in the Obama administration's nearly $1 trillion deficit-spending economic stimulus plan and to overcome a likely shortfall due to falling tax revenues, according to BustedBudget.com, a website dedicated to "tracking the government's shameful overspending one painful day at a time."
BustedBudget.com noted that factors leading to the increased federal government borrowing needs include the cost of the Troubled Assets Relief Program, amounting to approximately $700 billion, plus the nearly $1 trillion in deficit-spending that will be required to fund the proposed stimulus package.
Another contributing factor forcing the Treasury to plan for an unprecedented amount of federal borrowing this year is the unanticipated unemployment resulting from the economic downturn, with the resulting drop in employment tax revenues to the U.S. Treasury.
A total of 3.6 million jobs have been lost since the recession officially started in December 2007, according to U.S. Labor Department reports cited in the Wall Street Journal yesterday.
The Wall Street Journal also reported the U.S. unemployment rate for January is expected to grow to 7.5 percent, the highest since 1993, as 525,000 jobs were lost last month, up from the 524,000 shed in December.
The possibility that the U.S. Treasury will be forced to raise as much as $4 trillion in debt in 2010 just to finance the federal budget deficit raises the question of how long the Obama administration can continue to increase social welfare spending unless millions of new jobs are created as a result.
Given the Labor Department's estimates, the Obama administration will have to create over 3 million new jobs, just to replace the job losses that have occurred since December 2007.
According to the minutes of the U.S. Treasury's Borrowing Advisory Committee, or TBAC, a key advisory committee to the Treasury Department, Acting Assistant Secretary of the Treasury for Financial Markets Karthik Ramanathan said estimates for Treasury borrowing needs range between $1.5 trillion and $2.5 trillion in the current fiscal year.
The TBAC warned that federal borrowing in fiscal year 2010 could reach levels as high $4 trillion. The U.S. government defines fiscal year 2009 as Oct. 1, 2008 through Sept. 30, 2009.
Whatever the deficit is this year, the Obama administration will be forced to have the U.S. Treasury sell Treasury bills and notes in that amount.
The Treasury debt will be sold largely to foreigners, predominately in China and Japan, the two biggest foreign buyers of U.S. Treasury debt.
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GA FirstBank 7th failed bank of year, 32nd of recession (Correction 9, 34)
SAN FRANCISCO (MarketWatch) -- FirstBank Financial Services of McDonough, Ga. became the seventh bank of 2009 to fail and the 32nd of the recession on Friday, according to the Federal Deposit Insurance Corporation. Regions Financial Corp. said it will assume about $285 million in total deposits from FirstBank, and that the FDIC will retain most of FirstBank's loan portfolio for later disposition.Three More U.S. Banks Shut by Regulators as Financial Crisis Deepens
By Margaret Chadbourn and Ari Levy
Feb. 7 (Bloomberg) -- Three banks, two in California and one in Georgia, were seized by regulators, bringing this year’s tally of closings to nine as a recession and record foreclosures extend the biggest financial crisis in more than 70 years.
County Bank of Merced, California, with deposits of $1.3 billion and assets of $1.7 billion, was shut yesterday by the state’s Department of Financial Institutions, according to an e-mailed statement from the Federal Deposit Insurance Corp. Westamerica Bancorporation, holding company for Westamerica Bank, acquired all the assets and deposits.
The Georgia Department of Banking and Finance closed McDonough-based FirstBank Financial Services Inc., which had $337 million in assets and $279 million in deposits as of Dec. 31, the FDIC said in a statement. The California Department of Financial Institutions shut Culver City-based Alliance Bank, with assets of $1.14 billion and $951 million in deposits.
The FDIC was named receiver of the institutions, which will resume business as branches of the acquiring banks. Regulators seized six banks in January, the largest monthly toll since 1993, including Salt Lake City-based MagnetBank, which the FDIC closed Jan. 30 after being unable to find a buyer. The FDIC shuttered 25 banks last year, matching the total for 2001 through 2007.
The FDIC, other U.S. bank regulators and Congress are taking steps to help banks avoid losses as the administration of President Barack Obama readies a stimulus package that may include guarantees for toxic assets, according to people familiar with the plan.
Insurance Legislation
Legislation that would more than double deposit insurance coverage and offer safeguards for banks is being considered by Congress. The House Financial Services Committee unanimously approved a measure that would raise coverage to $250,000 per depositor per bank, from $100,000.
Congress also may extend the FDIC’s line of credit with the Treasury to $100 billion from $30 billion to replenish the deposit fund. The FDIC said bank failures through 2013 may cost the fund more than the $40 billion estimated in October.
“We do expect there to be more stress on banks, which could result in an increase in commercial bank failures,” said Comptroller of the Currency John Dugan in a Feb. 2 interview. A deepening recession that adds stress may lead to “significantly more losses,” said Dugan, regulator of national banks.
The FDIC on Dec. 16 doubled premiums it charges banks to replenish its reserves, which totaled $34.6 billion as of the third quarter. The Washington-based agency oversees 8,384 institutions with $13.6 trillion in assets.
Price Tag
The latest bank failures will cost the FDIC’s deposit insurance fund a combined $452 million. The fund is supported by fees on insured banks.
Westamerica, based in San Rafael, California, acquired 39 County Bank branches. The branches with Saturday hours will open as Westamerica offices today, and the rest will open Monday as usual. Westamerica shares have declined less than 1 percent in the past 12 months, to $48.52, as the 24-company KBW Bank Index has plummeted by almost two-thirds.
Regions Financial Corp. will buy about $17 million of FirstBank’s assets and assume all of the deposits, the FDIC said. FirstBank’s four branches will open as offices of Regions, a Birmingham, Alabama-based bank. Regions’ acquisition is its second in five months, following the purchase of Alpharetta, Georgia-based Integrity Bank’s assets in August.
“It is our responsibility to work with and support the FDIC in finding solutions for depositors in these challenging times,” said Regions Chief Executive Officer Dowd Ritter. “We also felt it was important to be a safe harbor for all customers by assuming both insured and uninsured deposits.”
Zions Bancorporation
California Bank and Trust of San Diego, owned by Salt Lake City-based Zions Bancorporation, acquired Alliance’s deposits and bought $1.12 billion of its assets at a discount. Alliance Bank’s five branches will open next week as offices of California Bank, the FDIC said. Zions, which operates in 10 Western states, also acquired the deposits of Henderson, Nevada-based Silver State Bank in September.
The FDIC classified 171 banks as “problem” in the third quarter, a 46 percent jump from the second quarter, and said industry earnings fell 94 percent to $1.73 billion from the previous year. The agency doesn’t identify problem banks by name.
The Obama administration is considering a range of options to unclog bank balance sheets, and may emphasize the guarantee of toxic assets over proposals to create a government-run bank. Treasury Secretary Timothy Geithner will unveil a plan as part of the financial-recovery package on Feb. 9, a Treasury official said yesterday.
Preventing Failures
The FDIC and the Office of the Comptroller of the Currency have taken steps to stem failures, such as allowing private- equity firms and other bidders to buy assets and deposits of lenders running out of cash. IndyMac Bank, the fourth-largest U.S. lender to fail last year, was sold to a private-equity investor for $1.3 billion on Jan. 2. The sale was led by Steven Mnuchin of Dune Capital Management LP.
Washington Mutual Inc., the biggest savings and loan, was seized on Sept. 25 and its assets were sold to JPMorgan Chase & Co. after customers drained $16.7 billion in deposits in less than two weeks. Wachovia Corp. was near failure before being bought by Wells Fargo & Co. for $12.7 billion.
_________________________'This isn't like a convenient oversight, this is intentional'
Posted: February 06, 2009
11:50 pm Eastern
By Bob Unruh, WND
President Obama's proposed economic stimulus plan makes a deliberate – and unconstitutional – attempt to censor religious speech and worship on school campuses across the nation, according to a lawyer who argued related cases before the U.S. Supreme Court 20 years ago and won them all.
"This isn't like a convenient oversight. This is intentional. This legislation pokes its finger in the eyes of people who hold religious beliefs," Jay Sekulow, chief of the American Center for Law and Justice, told WND today.
His was the organization that decades ago argued on behalf of speech freedom on school campuses, winning repeatedly at the U.S. Supreme Court. Since then, the 2001 Good News Club v. Milford Central School District decision was added, clarifying that restricting religious speech within the context of public shared-use facilities is unconstitutional.
The problem in the proposed stimulus bill comes from a provision that states: "PROHIBITED USES OF FUNDS. - No funds awarded under this section may be used for - (C) modernization, renovation, or repair of facilities - (i) used for sectarian instruction, religious worship, or a school or department of divinity; or (ii) in which a substantial portion of the functions of the facilities are subsumed in a religious mission."
The wording that specifically targets religious speech already has been approved by the majority Democrats in the U.S. House – all GOP members opposed it. In the Senate, Jim DeMint, R-S.C., proposed an amendment to eliminate it, but again majority Democrats decided to keep the provision targeting religious instruction and activities.
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Critics argued schools would accept any money offered, then impose a ban on religious events.
DeMint warned organizations such as the Fellowship of Christian Athletes, Campus Crusade for Christ, Catholic Student Ministries, Hillel and other religious groups would face new bans on access to public facilities that would not apply to other organizations.
"This is a direct attack on students of faith, and I'm outraged Democrats are using an economic stimulus bill to promote discrimination," DeMint said. "Democrats should be ashamed of themselves for siding with the ACLU over millions of students of faith."
DeMint's comments have been posted online and also are embedded here:
"These students simply want equal access to public facilities, which is their constitutional right. This hostility toward religion must end. Those who voted to for this discrimination are standing in the schoolhouse door to deny people of faith from entering any campus building renovated by this bill," said DeMint.
The senator said the stimulus bill now becomes an "ACLU stimulus" that has the goal of triggering lawsuits "designed to intimidate religious organizations across the nation."
"This language is so vague, it's not clear if students can even pray in a dorm room renovated with this funding since that is a form of 'religious worship.' If this provision remains in the bill, it will have a chilling effect on students of faith in America," he said.
DeMint cited Obama's statement at the National Prayer Breakfast this week that faith "can promote a greater good for all of us."
"This provision is an assault against both. It's un-American and it's unconstitutional. Intolerant and it's intolerable," DeMint said.
The ban on religious organizations is linked to the $3.5 billion intended for "renovation of public or private college and university facilities."
The ACLJ, which focuses on constitutional law, said the provision "has nothing to do with economic stimulus and everything to do with religious discrimination."
"The thing is I litigated these cases on these exact issues 20 years ago," Sekulow told WND. "Not only did we win, two of the decisions were unanimous and the other was 8-1.
"We're seeing a rollback to the 1970s regarding church-state relations," he said. "That's what is troubling. It is a complete rollback that now institutionalizes discrimination through targeting religion."
Sekulow said he already is drafting a complaint that will challenge the constitutionality of the provision, to be used if it isn't removed.
He said under current court precedents, it will be a open-and-shut victory.
However, he also warned that the problem is the damage that can be done within the probable four years it would take to get the issue to the U.S. Supreme Court and what that court would look like at that point.
Under Obama, he said, "there will be an ideology shift." New appointments to the bench by Obama, he said, would be "much more left of where Justices (Judith) Ginsburg and (Stephen) Breyer are."
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