Mother of All Bailouts Rejected; Now What?

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, 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.


16 comments on “Mother of All Bailouts Rejected; Now What?

  1. The oddity is that the Democrats were the ones who supported the bailout plan.

    Last week, McCain wasn’t wanted and Obama wasn’t needed during the discussions to hammer out the details of a bill to be sent to Congress. However, if these two men, both as sitting Senators and one to be the next President, were deemed as to have nothing of value to bring to the table, why are we having elections at all in November. If they are irrelevant now, they will be irrelevant come 1/20/2009.

    On a lighter note: Missing road signs – end of the road?

  2. Hi, Sasha. I actually gave you your own category yesterday: “Sasha Says.” You’ll find the two posts you did in there. I will check out the road signs. You’re right. We need some cheering up! — Monica

  3. Hi Ladies! Today ‘Hammerin’ Hank’ had the vapors as if there’s something they’re not telling us about their haste…or is he simply a bad actor?

    Excelllent post, Monica, as usual. Sasha, you’re so right. jude

  4. Sasha – Right to the point. Congratulations!

    Do you see any possibility for the U.S. changing its two-party system? Much of the problem lies there, I believe. It’s so petrified, old fashioned.

    Anyone ready to throw all this ballast over board? Part of the reason so many Americans are tired of Washington is that’s become so stuffy. Total lack of imagination, except sometimes, when it comes to formulating foreign policy moves, and even then, if it’s not based on lies.

  5. This is a quote from my congressman about his vote on the MOAB bill:

    Rep. Brad Miller, a Raleigh Democrat who represents parts of Greensboro, called the bill a “bitter pill” but voted for it.

    “I do think we are in a worsening financial crisis that will affect ordinary Americans, not just financial institutions,” Miller wrote in an e-mail. “The economy will slow dramatically if every business and every American family has to operate on cash.”

    There is a place for credit but many American families (and our government) need to place a heck of a lot more emphasis on operating on a cash basis. If we had done more of this, only spending what we really had instead of on the basis of what we wished we had, then we might not be having this conversation.

    Now, I need to go write a letter to my City Council asking them to rescind $205 million in bond issues on the November ballot

  6. An outrageous suggestion on how to help solve the problem with foul debt: Few people know that some years ago when the Berlin Wall came down, Karl Marx was released from hell and could go to heaven.

    Being a trained dialectition, he kept a very low profile, until just recently. Some of St. Peter’s assistants told him that high up in the celestial hierarchy an opinion prevails that human stupidity is biological.

    Since then Marx feels really in heaven! And he even took up some activities again. All theoretical, his specialization.

    While observing what was going on on earth, Marx started wondering, why in Brazil, with all the social injustices there are, communism never has had a chance. Now, he know the reason: It’s Brazilian custom is to have a caixa dois, a hidden kitty, often with more money in it than in the main accounts, be it a business, a government agency (yes), or a hospital etc.

    And that’s what gave me now an idea: The Bushes (father and son and add Cheney to make three), should simply consider Kuwait as America’s hidden kitty! After all, the price of oil has not collapsed, the dollar is up nicely, and Kuwait owing to the U.S. what it owes, it’s easy to ask the Kuwaitis to throw some intelligently applied billions into the financial markets.

    Everybody would be winner: Bush does not need to worry about Congress, Pelosi can take a break, the markets will get a necessary cash injection, and Karl Marx may discover that that the Brazilian example is now spreading to the Northern Hemisphere!

  7. Well, Gian Paul, we always suspected people see things differently in Brazil and now we’re absolutely sure. The “hidden kitty” theory explains a lot. Thanks for entertaining us with your truly imaginative solutions to world problems. — Monica

  8. Rumor has it that President Bush, anxious to know the outcome of tonight’s vote in Congress, discreetly contacted his administration’s astrologer, and was told the astrologer is no longer working for politicians.

    Why? It appears that this very competent astrologer has taken up working 24/7 for, you guessed it, Halliburton. (Intelligent move, that company for sure will survive Bush’s administration).

    My hunch: Bailout vote will again not pass. President Bush has transiting Jupiter (now direct) opposite his Sun (an afflicted Sun in Cancer, square Moon, Jupiter in Libra and, in my view, conjunct Saturn.)

    Plus, transiting North Node and Neptune are as close as they will ever get to opposing Bush’s Venus in Leo. Guess that the astrologer now working exclusively must have seen these transits as well.

  9. Waitaminnit — the Live Free or Die state went for John Kerry in 2004.

    I guess I wouldn’t say the fat cats were defeated by Congress — that’s not even remotely possible. You can’t overestimate how much our representatives worship successful money people, even when they’re not successful. I’m more inclined to see it as a cynical ploy to show how seriously they considered this plan, which 95% of them wouldn’t have been able to explain. Reject it first, then pass it with some tweaks they also won’t be able to explain.

    Unfortunately, the mindset in this country is still that we don’t need to learn from anyone else — we’re the greatest country in the world! It’s an empirical fact! We can learn nothing from anyone!

    Arrgh. Not that I’m bitter or anything.

  10. Aw, come on, you know “Live Free or Die” is a state of mind in addition to being the state motto of New Hampshire.

    Interesting take on the legislative dance of the buyout. Seems like you have some experience watching lawmakers in action.

  11. Bush has always done well with the Jupiter transits to his Sun, I thought this would expand him more than it has, but it certainly hasn’t thus far.

  12. Monica – I really misread Bush’s transits when I predicted the bailout bill wouldn’t pass.

    Still, how can he have the affront to say that the “taxpayer will see his money back”?

    Reminds me, fond of history, of Roman times: “Panem et circenses“. (Bread and circuses). The accent looks heavy on the circuses and light on bread to me! — Gian Paul

  13. Monica –

    Gave a look at Wall Street’s chart (May 17, 1792 – 08:52 N.Y.).

    Intriguing, Moon today entered in Sagittarius (optimism) and is in House V of Wall Street, the house of games and pleasures. Such a pity for Lehman Brothers, they quit the table a bit too early (or Paulson was a bit too slow…). That’s what happens in this type of game! (N.B. in my experience, in horary astrology, where the Moon happens to be at the moment I look at a chart, that’s where the “fish will bite”).

    A bit more further out, on the same chart: Just saw that early November (nothing to do with the result of your elections, it’s planetary), Saturn will conjunct Wall Street’s natal Mars (in House II ), but there is more. A few days later Uranus, stationary and then direct at the end of November will oppose that same Mars. Speculate that that may create a “nice down move,” nice because if ample enough one may have a superb opportunity to enter at basement prices for the often probable January rally.

    So, happy days ahead, if not immediately for taxpayers, at least for one who likes to risk a buck or two from time to time in this superb casino, which your so wise politicians just saved. Thank you Bush, or is it the Democrats we have to be grateful to?

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s