Dr. Elizabeth Warren speaks on the Economy (PBS)

[phantom power]

What exactly is going on with the economy? Stocks are up and big bonuses are back, but while they're throwing parties on Wall Street, there's pain on Main Street. One out of every six workers is unemployed or underemployed, according to government statistics - the highest figure since the Great Depression.

This week NOW gets answers and insight from Harvard professor Elizabeth Warren, who's been heading up the congressional panel overseeing how the bailout money is being spent. NOW Senior Correspondent Maria Hinojosa talks with Warren about how we got to this point, and where we go from here.

What will it take to put both bankers and American businesses on the same road to recovery?

http://www.pbs.org/now/shows/546/index.html

[Possumpoint]

1. Warning

Listen to the link only if you really want to get pissed off!

[Joe Chi Minh]

2. This outrage, I predict, will have one very good outcome. In the future,

once the dust has settled, no-one with an IQ above 40 will consider for one nanosecond availing themselves of a credit card, or even an overdraft. In fact, anyone who can avoid using a bank at all, will do so. If the very government cannot be relied upon to actually favour the needs of the public over that of the bountiful, corporate lobbysists, who, in their right mind would risk their very house and home, in the future, when so many are losing everything they possess, here and now, in the present? The scum will not always be at the top. They too will sink.

I'm not talking about the 'rentier' class, of course, who live off their investments. They will doubtless have their own problems, if not now, in the future. I think the days of directors and stockholders holding countries to ransom will come to an end, and sooner, rather than later.

[izquierdista]

5. Just like the last Depression

My parents lived through the Depression and they used credit as little as possible. The only loan they had was the home mortgage, obtained with 20% down and paid off in 13 years, not the full 30. They lived without credit cards until 1969, when the car needed a major repair while we were on vacation. After having to get money wired from friends to cover the expense, they decided that maybe, just maybe, they should have one credit card for emergencies. So they got an American Express card, because that was the one card that required you to pay off your balance in full each month.

[phantom power]

6. As with home mortgages, one big problem with credit cards...

is the completely out-of-proportion credit lines that the companies issue to people. At one point in the late 90s, I had a $50,000 limit on one credit card. At the time, that was pretty close to my annual salary. Nobody should be able to charge their annual salary on revolving credit. It's fucking insane. I happened to know that was ridiculous, so it was more of an amusement to me than anything else, but tons of people are sufficiently financially illiterate to not understand why it's such a terrible idea.

At one point, I advocated that revolving credit lines ought to be about as difficult to apply for as a home mortgage -- in the sense that you should have to provide documentation about how much you make, and what credit you already have, etc. But that was before the mortgage companies turned it on its head and instead made applying for a mortgage as easy as applying for a credit card.

[Warpy]

3. I've been telling people to pay those bastards off

for the last six years. I saw this coming.

I have a great deal of sympathy for people who didn't see this coming, but honestly, the writing has been on the wall for many, many years. Junk fees were assessed starting in 1991 and have never been regulated. Neither have their interest rates. Sign up contracts are meaningless with no one to enforce them.

Congress is to blame, of course, the chickenshits bowing to industry instead of protecting citizens and giving the vultures time to try to pick us all clean.

Banks are largely getting the money to pay back TARP loans and keep us out of their business from increased fees on the backs of their smallest depositors.

And we have no one on our side but Rep. Frank.

[phantom power]

4. I have a feeling the current system is going to have to implode...

implode completely into a naked singularity that devours the bulk of our current jive economy and then seals itself up forever with a little burp.

Right now, I bet the bulk of consumers would cheerfully walk away from their credit card ball and chain... except it's the only thing keeping their lips above the water line. I don't think the last round of reforms came in time. Especially without the grandfathering. You can just picture how quickly that idea got shitcanned by the credit lobbyists.

[blue97keet]

7. I have not used a credit card in 12 years

But I keep getting robocalls from something called "Cardholder Services".

[fasttense]

8. Until foreign countries like China and Mexico, can no longer sell their crap

in US markets for large amounts of dollars, nothing will change.

Our government is so corrupt that even Obama and a Democratic majority in both Congressional houses can NOT pull the power of our government away from the corporations. The Republicons gave the corporations the power. The Democrats stood around with their hands in their pockets while they did it and even signed off on some of the power grabs.

I think this country is too far gone for any change to come out of Washington. The strangle hold the corporations and 300 richest people in the US have over us is cemented into the very fibers of DC.

The change has to come from the outside, perhaps even outside the country.