The Author critically evaluates latest myth surrounding the US government’s guarantee of $306 billions issued to Citigroup and cash funding of $ 45 billions under TARP. The Citigroup CEO Mr. Pandit’s statement that the Citigroup was having the best quarter since 2007 was an act of deceiving the Senators, President Obama and American Tax Payers. According to Author, a clever game of creative accounting was played out at the highest level. Instead of making Citigroup absorb the losses in its own book, the creative genius were at work to ensure that the Citi was spared and the nation (USA) was obviously destroyed. How as it achieved – Read the full article.
The Author reproduces the letter addressed to the President Bush proposing resolution of credit crisis with complete action plan. The letter was received by White House on 25 August, 2008, almost 2 months and 1 week before the present impasse. It was not attended to with the result the crisis developed at unprecedented pace from 2nd week of September, throwing entire Nation and the World into most horrific financial crisis. While the President had time to go to G7 meeting, he did not have time to at least look at the solution recommended at his doorstep by this author. And the result is known now – $40 trillions lost world over in last 2 months (including $15 to $20 trillions in US alone) and the crisis is not even showing sign of abating – in fact it is worsening. 2 months of golden opportunity was thrown away by the President of United States who never had any idea what to do, when, how and resolve it as fast as he could. He believed merely on rhetoric and trusted his advisers who let him down everywhere.
The Author implies that if some standard or dogma does not work out for a long time, then it is time to abandone that standard. We carry hundreds of old beliefs that low interest rates promote the growth, GDP but ask Japan, did it work for them for 14 years in spite of having near Zero interest rate? Ask United States – did it work for them either for over 7 years during which Alan Greenspan brought down the interest rates on its knees without yielding any tangible result. Low interest rates fostered the derivative trades and toxic investment products that neither seller nor buyer understood. Author not only evaluates the reasons but also provides uncoventional solution to the present problem, Read the article which is written in very simple English without any jargons, in convincing and logical manner. Offer your comments, howsoever small, if you really liked the article. Other articels are found on the side bar. if you wish to download, use the download box for well formatted PDF files.
The article deals with the second round of efforts of the US administration, Mr. Paulson and Mr. Bernanke to get the bill passed authorizing unquestionable authority to spend $700 Bln. This time the Senate has been approached. Should it be passed or rejected again. read further…
The article analyzes the reasons for rejection of Paulson Plan and fall of Dow by 778 points. It discrinminates what is right and wrong and how the rejection will go a long way to cure the ills.