From The Ramparts
Junious Ricardo Stanton
In Other News...
“WASHINGTON (AP) -- Regulators shut down Houston-based Franklin Bank and Security Pacific Bank in Los Angeles on Friday, bringing the number of failures of federally insured banks this year to 19. The Federal Deposit Insurance Corp. was appointed receiver of Franklin Bank, which had $5.1 billion in assets and $3.7 billion in deposits as of Sept. 30, and of Security Pacific Bank, with $561.1 million in assets and $450.1 million in deposits as of Oct. 17. The co-founder and chairman of parent Franklin Bank Corp., Lewis Ranieri, is credited with inventing mortgage-backed securities two decades ago, but apparently was unable to save his own company from getting ensnared in the home-loan bust.” Regulators shut banks in Texas, California Saturday November 8, 1:29 am ET
While most black folks are still giddy, excited and celebrating the election of Barack Obama as president of he United States, the US economy continues to unravel at an increasing pace. The Associated Press reported on Saturday two more banks have been taken over by federal regulators bringing the number of banks that have failed this year to nineteen. The supreme irony (Karma?) is one of the banks’, Franklin Bank Corp of Houston Texas, founder Lewis Ranieri was the man credited with inventing mortgage backed securities which are at the core of the current mortgage and credit meltdowns.
These two banks have joined an alarmingly increasing list of banks going belly up. More bank failures are predicted as the mismanagement, fraud and maleficence of the banksters continues to ripple throughout the system; infecting the whole economy. Even the FDIC is predicting more failures in the months and years to come due to the systemic implosion of the financial sector. “The 19 bank failures so far this year compare with three for all of 2007 and are more than in the previous five years combined. It's expected that many more banks won't survive the next year of economic tumult. The pressures of tumbling home prices, rising mortgage foreclosures and tighter credit have been battering many banks, large and small, across the nation. The failures this year include that of Seattle-based thrift Washington Mutual Inc. in late September, the biggest bank collapse in history. It had $307 billion in assets. In July another big savings and loan, IndyMac Bank based in Pasadena, Calif., failed and was seized by regulators with about $32 billion in assets. The FDIC estimates that through 2013 there will be about $40 billion in losses to the deposit insurance fund, including an $8.9 billion loss from the failure of IndyMac Bank. The FDIC is raising insurance premiums paid by banks and thrifts to replenish its fund, which now stands at around $45.2 billion, below the minimum target level set by Congress and the lowest level since 2003.” http://biz.yahoo.com/ap/081108/bank_closures_texas_california.html
President elect Obama comes into office facing the most frightening economic climate since the 1930's. The stock market continues to sputter and the job losses are the highest in fourteen years. Keep in mind the government’s figures are suspect due to their long history of fudging, manipulation and lies. “Some economists predict the jobless rate could climb to 8%, or possibly higher, next year. Job losses in August and September turned out to be much deeper than initially estimated by the Labor Department. Employers cut 127,000 positions in August, compared with 73,000 previously reported, while 284,000 jobs were axed in September, compared with the first estimate of 159,000 jobs. The revised figures for September showed the biggest monthly cut in jobs since November 2001. The employment market is much weaker than economists expected. They were forecasting the unemployment rate to climb to 6.3% in October and for payrolls to fall by about 200,000. The department said 481,000 people in the US filed new claims for jobless benefits in the last week of October.” http://news.bbc.co.uk/2/hi/business/7715873.stm
Here’s additional bad news, the US auto industry is faltering. GM, Ford and Chrysler all announced worsening sales and profit outlooks. “New Jersey-based Research firm Autodata said on Monday that US auto sales dropped for the 12th straight month in October to 838,156 from 1.23 million last year, the lowest monthly level since 1991.The seasonally adjusted annual sales rate for the month was 10.6 million down from 16.04 million a year ago. It is the worst seasonally adjusted annual rate of sales since February. Monthly auto sales in US were down 32% while seasonally adjusted annual sales rate slumped 37%. The largest US automaker, General Motors (NYSE: GM), said its October US sales shrank 45% to 168,719 cars and trucks in October from 307,408 a year ago. Sales of light truck were down 51% to 97,119, while passenger car sales fell 34.3% to 73,466 vehicles. In a conference on Monday, GM Sales Chief Mark LaNeve said ‘In my 27 years (in the auto industry), I've never seen a month like this.’ GM's market share likely fell to around 20% in October. ‘Clearly we're in a very dire situation,’ said Mike DiGiovanni, GM executive director of global market and industry analysis. The other two who make U.S. Big Three automakers- Ford (NYSE: F), and Chrysler, also saw their sales falling by double digits in October. Ford reported that it sold 132,838 cars and trucks last month, down 30.2% from 190,195 vehicles a year ago. Dearborn, Michigan based automaker reported that the combined car sales of Ford, Lincoln and Mercury fell 26.8% to 40,854 units. Demand for SUVs fell 54% while it was down 39% for crossover vehicles. Sales of F-Series pickups dropped 16.3% to 43,324 units. Chrysler registered a 35% drop in sales to 94,530 vehicles. Vice president of marketing and communications Jim Farley said in a statement ‘Economic and market concerns have hurt the industry, along with harsher credit terms. We do not see near-term relief for Ford or its depressed shares.’ Chrysler said its October U.S. sales tumbled 35% to 94,530 vehicles. Demand for Chrysler's heavily-weighted truck lineup fell 34% while that for cars, it was down 37%.” US October Auto Sales Sink, GM Sales Tumble 45% http://www.istockanalyst.com/article/viewarticle+articleid_2764128.html
The news across the country concerning the economy is not good. Hopefully Obama will be able to inspire folks to tough it out and not despair because the news is not going to get better any time soon. On the personal level, don’t get discouraged or become a gloom and doomer. Become more frugal with your money and begin living within your means. Strive to get out of debt and please do not fall for the materialism, buy, spend keep up with the Jones’ okey-doke.
Things are going to be bleak for a while but do not despair, we will make it through. It is not what happens to you in life, it is how you choose to deal with it that counts. Don’t pin all your hopes on Barack Obama. He is only one person and this is a groups thing. We have to press for economic and social justice and policies that benefit the whole country not just Wall Street and the Kleptomaniacs that got us in this predicament in the first place.