Noam Chomsky on “Crisis and Hope: Theirs and Ours” (video)

Watch this fascinating view on "the crises". Noam Chomsky at his best:

Economic Meltdown 101 - Peter Schiff explains the credit crunch in plain English (video)

Grab a beer and watch this to learn about bubbles, dot com crash, credit crunch, the World's biggest Ponzi scheme, and more:

California, richest state, almost broke

LOS ANGELES — The state of California — its deficits ballooning, its lawmakers intransigent and its governor apparently bereft of allies or influence — appears headed off the fiscal rails.

Since the fall [...] the state has fallen into deeper financial straits, with more bad news coming daily from Sacramento. The state, nearly out of cash, has laid off scores of workers and put hundreds more on unpaid furloughs. It has stopped paying counties and issuing income tax refunds and halted thousands of infrastructure projects.

Twenty-thousand layoff notices will go out on Tuesday morning, Matt David, the communications director for Gov. Arnold Schwarzenegger, said Monday night. “In the absence of a budget we need to realize this savings and the process takes six months,” Mr. David said.

After negotiating nonstop from Saturday afternoon until late Sunday night on a series of budget bills that would have closed a projected $41 billion deficit, state lawmakers failed to get enough votes to close the deal and adjourned.

More here.

LINK
- New York Times: California, Almost Broke, Nears Brink
- Democracy Now! Layoff Notices for 20,000 California Workers Sent Out

Greenspan admits he made a "mistake"

The "architect of the 2008 credit crunch" has admitted he made a "mistake":

Alan Greenspan, the former Federal Reserve chairman, said on Thursday the credit crisis had exceeded anything he had imagined and admitted he was wrong to think that banks would protect themselves from financial market chaos.

“I made a mistake in presuming that the self-interest of organisations, specifically banks and others, was such that they were best capable of protecting their own shareholders,” he said.

In the second of two days of tense hearings on Capitol Hill, Henry Waxman, chairman of the House of Representatives, clashed with current and former regulators and with Republicans on his own committee over blame for the financial crisis. [more]

Of course there was never any malicious intend; of course not. Who could know there would be an and to the supply of NINJA loans?

LINKS
- Financial Times: "I made a mistake"
- Wikipedia: Architect of the 2008 Credit Crunch: Alan Greenspan
- Wikipedia: Why the rich get richer, and the poor get poorer.
- Wikipedia: Ninja loans for all of us

Major Dutch Bank FORTIS Nationalised by Dutch Government due to international credit crisis

Radio Netherlands Worldwide:
The Dutch government is taking over the Dutch activities of Fortis bank, at a cost of 16.8 billion euros. Prime Minister Jan Peter Balkenende announced the takeover at a press conference on Friday afternoon, alongside Finance Minister Wouter Bos and Central Bank President Nout Wellink.

The move is meant to reassure investors in the troubled banking group. It comes just one week after the Dutch government said it would buy 49 percent of the Fortis activities in the Netherlands, part of a deal agreed with the governments of Belgium and Luxembourg. The new arrangement supersedes last week's deal.

Fortis has been victim to the international credit crisis. It could no longer raise the money needed to pay for its purchase of the ABN AMRO bank, a deal reached eighteen months ago and also involving Royal Bank of Scotland and Banco Santander. The Fortis share in that deal has now been brought into question.

In addition, the bank started losing customers in the Netherlands and in Belgium. The value of its shares fell to a record low.

Turbulence
Prime Minister Balkenende says that, with the purchase of Fortis, he wants to bring calm and stability to the financial sector during a turbulent time. Finance Minister Bos said the Dutch government is protecting the interest of the bank's customers, and making sure the finance climate in the Netherlands is safe.

Asked what the criteria for such a move was, Mr Bos said, "The Netherlands will take action if and when financial institutions crucial to the stability and integrity of the financial system get into significant trouble." He was quick to add that no other Dutch institution is currently facing such trouble.

Explanation
The finance minister will have some explaining to do in parliament this coming week. He has been reassuring Dutch lawmakers about the soundness of the deal agreed last week to buy 49 percent of Fortis activities in the Netherlands, while behind-the-scenes negotiations were underway for a complete takeover of the Dutch divisions of the bank.

The move, effectively nationalising one of the largest banks in the Netherlands, goes against the trend of the last few decades of selling off government interests. Mr Bos says he cannot say yet how long the government will keep the bank.

LINKS
- Radio Netherlands:Dutch government nationalises Fortis