The House of Representatives voted against Treasury Secretary Henry Paulson’s plan to bail out Wall Street and the Dow Jones industrial average closed down 777 points today, Sept. 29. This is a record in the number of points lost in a single day, though not a record in percentage terms.
On the one hand, we’re tempted to celebrate because the fat cats were defeated by Congress. But the reality is that many Americans have pensions, retirement, and mutual funds that own stocks. A lot of retirees have been hurt by the demise of seemingly safe financial companies such as Washington Mutual because they bought the shares for the rich dividends.
As the old saying on Wall Street goes, “a rising tide lifts all boats.” Even if we weren’t raking in the dough, some wealth was trickling down to us from the orgy of debt and speculation, though it may have been nothing more than a government stimulus check.
It’s the least the Republicans could do after having allowed corporations to fleece us in a manner that James Galbraith (son of famed economist John Kenneth Galbraith) has labeled “predatory capitalism” in his new book The Predatory State.
Given that Mercury is retrograde, it’s a good thing the so-called rescue plan wasn’t approved. Anything signed during the period when the Winged Messenger appears to be moving backward from the perspective of Earthlings would have to be revised down the road anyway.
Still, economist Nouriel Roubini is warning that the chance of a total financial meltdown is greater than ever and the 3rd Infantry Division’s 1st Brigade Combat Team is being deployed stateside as of Oct. 1, a military buildup ahead of the election that has pundits and ordinary citizens alike concerned.
One blog, UrbanSurvival.com has been talking for some time about a “hot date” of Oct. 7 for an event that will disrupt the U.S.
What are we to make of it all?
As someone who lived through the Y2K buildup and letdown, I’m always leery of dates when the world is going to end or hell is going to freeze over. Having said that, I didn’t live through the Depression, and I’ve never seen a run on a bank. Gas lines, yes, in 1979.
I think the political and financial gridlock we’re experiencing demonstrates the weakness of American-style democracy. If we were in Britain, Germany, Italy, or Israel, there would be a no-confidence vote and Bush and Cheney would be sent packing. Immediately, McCain and Obama would jockey to form a new government, based on the relative strength of Republicans and Democrats in the two chambers, and we’d start all over again.
Instead, we’re stuck with these jokers until Jan. 20 while the markets melt down. The fact is the “no” vote on the bailout proposal is a no-confidence vote for the Bush Administration and its policies. The media is reporting that e-mail and phone calls are running 100-to-1 against the $700 billion plan.
The period we’re in reminds me of when President Nixon had to take the U.S. off the gold standard in August, 1971. He himself would be forced to resign three years later. This de-linking of the dollar and bullion marked the end of the Bretton Woods agreement, a world financial system dominated by the U.S. that was set up in the wake of World War II.
Economists debate about whether we’re in Bretton Woods II or III, but the original chart still bears looking at, if you ask me. It’s set for noon in Washington on Dec. 27, 1945, the day the agreements were signed, with transits of today.
Some would argue that Bretton Woods is already dead and gone. Here’s my humble opinion: The dangers posed by a U.S. financial meltdown are so great that the Group of Eight industrialized powers and the leaders of other key emerging economies such as India, China, and Brazil need to start hammering out the sequel to Bretton Woods. Incidentally, the accord got its name from the town in New Hampshire where the negotiations to form the International Monetary System took place for three weeks in July, 1944.
Even if a modified form of the bailout is approved after Mercury goes direct on Oct. 15, you can see from the Bretton Woods chart that it will soon be “transformed” (read destroyed and reborn) as Pluto in Capricorn goes over its Sun. You’ve heard it all before, but the current economic unraveling in the U.S. and Britain, which also got hooked on debt, is leading up to the Cardinal Climax. That’s when Uranus/Pluto/Saturn will form a T-square in the early degrees of cardinal signs in 2010.
As the Uranus in the New Moon in Libra chart of Sept. 29 indicated, we’re in for some surprises in the short term. Economic panic is possible, though not likely. In any event, the process of cleaning up all the bad debts that are weighing down U.S. financial institutions is going to take years. Just ask the Japanese. They spent 14 years in an economic deep freeze after their real estate bubble burst and the Nikkei crashed in 1991.
I’ve said it before and I’ll say it again: We can learn a lot from the Japanese in terms of living in a civilized fashion while conserving our resources and saving for the future. I just don’t think this regimen is what the “Live Free or Die” Republican driving the Ford F-150 pickup had in mind when he voted for George W. Bush.