The second largest bank failure in history occurred on Friday.
IndyMac Bank of California was taken over by federal authorities because nervous depositors created a multi-billion dollar run on the institution. There are real questions about whether or not large depositors can or will get their money out. They face losing at least half of assets above the FDIC insurance limit of $100,000.
Treasury secretary Henry Paulson made a rare Sunday statement yesterday assuring that two semi-private entities created by the United States government to promote housing and mortgage markets—Freddie Mac and Fannie Mae—will be rescued with government funds at a time when the government is running deficits.
Seven large banks are on a failure watch list according to reports at this writing from MSNBC.
Foreclosures are running at highs unseen in seventy years.
Questions are rising about the country’s AAA credit rating because so much money has been borrowed to finance the wars in Iraq and Afghanistan.
Energy and food prices are sucking disposable income out of the economy.
America is hurting despite the characterization by Phil Gramm—one of Republican presidential candidate John McCain’s campaign co-chairs and surrogates—of America as a “nation of whiners” when it comes to the economy. Almost half a million jobs have been lost just this year.
An administration that refuses to acknowledge the judgement of its own scientists regarding global warming can’t be trusted to give us a true pictuire of our economy. An administration that can’t bother to keep track of the very real effects of doubled gas prices on low- and middle-class citizens can’t be expected to reflect that pain in its reporting.
The legions of the homeless rise in silence.
More Americans live on the cusp of poverty than at any other time in our history.
Rising prices are butting up against a ceiling created by stagnant or falling wages.
The falling value of the dollar erodes the buying power of all but the most affluent Americans.
Some people beliieve that the bad news is driven by bad press. The fundamentals of the economy and the realities of everyday life for the American people point to another, more pragmatic explanation: The economy is in trouble.
Welcome to the Great Depression of 2008.