LOVE IT!! London Issues Orders to Obama: Hyperinflate!

London Issues Orders to Obama: Hyperinflate!
August 18, 2010 • 7:22AM


The British Empire's messengers continue to bark out orders to their Obama administration in Washington, that he has to hyperinflate the financial system like there is no tomorrow. After all, it worked really well for Weimar Germany, didn't it?


On the day of the Washington confab on "The Future of Housing Finance", chaired by Treasury Secretary Geithner and HUD Secretary Donovan, the Financial Times editorialized that the U.S. housing bubble must not be allowed to pop, and that in fact a brand new one should be built on top of the old one. It is "politically and economically imperative to keep house prices high and rising," they intoned, since "the U.S. is still not in a position to bear a tidal wave of foreclosures... Cramming down mortgage assets would pull the rug away from under a barely recovering banking system."


The only problem with the FT's description is that the banking system is already hopelessly bankrupt, and that a second tidal wave of foreclosures has already begun. For example, mortgage delinquencies (defined as being 3 months or longer in arrears) rose nationally from 3.3% in 2008, to 9.4% today—a near tripling. In 23 congressional districts in the worst-hit states—California, Nevada, and Florida—delinquencies are running at 20% and higher.


In a private discussion, an economist at one of Germany's regional Landesbanken confirmed that there is much discussion in financial circles about another U.S. government mega-bailout in the works, in the range of $2.5-3 trillion dollars on top of the $2.3 trillion in toxic paper that the Fed already owns—exactly as British spokesmen have been demanding of Obama for weeks.


The fresh Monopoly money would be targetted to bail out not only the real estate speculative bubble, but other toxic assets as well. The Landesbank economist said that printing $3 trillion in new money would lead to a total collapse, and she couldn't believe that Geithner, Bernanke and Obama would be crazy enough to risk that.


She's wrong about that. Indeed, some authorities in Washington have confirmed to EIR that if the Fed expands their assets portfolio to $3 trillion total, that break-point will trigger a Weimar hyperinflationary blowout!

OH yeah.....let the fun begin!!!!!!!!!

GOT TO LOVE THE ENGLISH NEWSPAPER!!! You won't read this stuff in the USA!!

Geithner Organizes Call for Yet Another Hyperinflationary Bailout of All Mortgage Backed Securities
August 18, 2010 • 8:16AM


Tim Geithner's Aug. 17 conference in the Treasury's ornate Cash Room on "The Future of Housing Finance," concluded that a “consensus” had miraculously developed for another U.S. government multi-trillion bailout of the entire mountain of Mortgage Backed Securities (MBS) financial trash, and other derivatives in the housing sector—exactly as London has been demanding of the Obama administration.


The London Financial Times had issued the editorial orders again that same morning of the conference: Damn the torpedoes, print all the money necessary to drive housing prices (i.e., mortgage-backed securities values) back up into the stratosphere.


Geithner represents an Obama White House which wants desperately to comply, despite political mass-strike opposition and the hyperinflationary futility of the policy itself. Days ago, Lyndon LaRouche had commented, "Another round of hyperinflationary swindles around Fannie and Freddie is coming."


The first hyperinflationary round was in 2007-2008, when a cowardly Congress refused to adopt LaRouche’s Homeowners and Bank Protection Act (HBPA), which would have frozen the bubble and stopped all foreclosures instantly. Instead, the country got millions of layoffs and a full-fledged depression collapse, while the cancerous bubble only grew.


At Treasury Secretary Geithners conference, Bill Gross of the giant PIMCO bond fund issued the call for Round 2: "Full nationalization of mortgage finance!" cried Gross. "The economy is approaching a cul-de-sac. We need a positive stimulus. Refinance all current mortgages at lower rates. Guarantee all MBS based on this." (Gross had announced only last week that his PIMCO would be going bigger into buying MBS!)


The head of Bank of America's mortgage/securitization operations, Barbara DeSoer, had already called for an "explicit guarantee [by the government—ed.] of mortgage-backed securities," the super-toxic crap debt which the banks have refused for three years to write down. The amounts involved range from a cool $3-$5 trillion in additional Monopoly money.


Geithner then announced his discovery that "a consensus seems to be emerging" from his conference panel, for a government guarantee of all MBS values!


An hour later, HUD Secretary Shawn Donovan, running the second conference panel, saw fit to remind that there had been "something of a consensus on the earlier panel for an explicit, rather than implicit, guarantee of MBS."


The only actual “consensus” emerging in the country is that Obama and all his minions, like Geithner, should be removed from office immediately, quicker than you can say “MBS.”