see: “When the first triennium of the Trilateral Commission was launched in 1973, the most immediate purpose was to draw together—at a time of considerable friction among governments—the highest level unofficial group possible to look together at the key common problems facing our three areas. At a deeper level, there was a sense that the United States was no longer in such a singular leadership position as it had been in earlier post-World War II years, and that a more shared form of leadership—including Europe and Japan in particular—would be needed for the international system to navigate successfully the major challenges of the coming years.

Two strong convictions guide our thinking for the 2006-2009 triennium. First, the Trilateral Commission remains as important as ever in helping our countries fulfill their shared leadership responsibilities in the wider international system and, second, its framework needs to be widened to reflect broader changes in the world. Thus, the Japan Group has become a Pacific Asian Group, and Mexican members have been added to the North American Group. The European Group continues to widen in line with the enlargement of the EU. We are also continuing in this triennium our practice of inviting a number of participants from other key areas.

The “growing interdependence” that so impressed the founders of the Trilateral Commission in the early 1970s is deepening into “globalization.” The need for shared thinking and leadership by the Trilateral countries, who (along with the principal international organizations) remain the primary anchors of the wider international system, has not diminished but, if anything, intensified. At the same time, their leadership must change to take into account the dramatic transformation of the international system. As relations with other countries become more mature—and power more diffuse—the leadership tasks of the original Trilateral countries need to be carried out with others to an increasing extent….”
http://www.trilateral.org/about.htm

and, for further: http://www.icerocket.com/search?tab=web&fr=h&q=trilateral+commission&x=24&y=14

Could all of the newest problems just be symptomatic of a deeper issue starting in 82?
’82 was just when we started running out of ‘seed-corn’..

I have been running what you said through my computer (head) a bunch and I don’t see how the story you told me fits the chart. Please fill me in where wrong: If the credit crisis is based on banks lending with insufficient collateral, chopping it up and shipping it out (MBS), then shouldn’t the massive amount of debt start around 2002(ish)? It seems like around 82 we really fell in love with debt. I always thought this whole mess revolved around MBS/CDS/non-regulation/bad rating agencies/moral hazard to name a few. But the chart Steve Barry showed makes the problem seem much much deeper than all of that.

Could it be that even without the recent MBS/CDS/non-regulation/bad rating agencies/moral hazard problems we would have got here eventually? Could all of the newest problems just be symptomatic of a deeper issue starting in 82?

Thanks for the time, I know this is out of my pay grade but I’m applying to conservative (legal) think tanks in D.C. (mostly social matters) but I would really like to have some understanding of what is going on. Also its impossible (or rather pretentious) to attempt to write a note about something that I don’t understand well enough.

Ted

withdrawl industry and jobs – wreck the economy – swoop in and buy the devalues -
return the industry with taxpayer TIF assistance – sell reinvigorted devalued to the thriving economy

forgot the interum step – sell the CDSs on territory and regional areas

I saw this line on another thread by Mark Hoffer
“if your Goal is De-Industrialization, then it makes Perfect Sense”

today we have an announcement locally – Mittal steel rolling mill to shutdown – sounds permanent, but won’t be, seen this before as LTV

maybe this is a grand plan to strip foreigners – shame on this system if so

We have bailed out the financial system to prevent a systemic melt-down. I get it!!!! We the tax payer may get it back out of whatever earnings or scams they can come up with. I hope!!!!! The auto guys want a bail out to help them. They will pay us back in the future from the profits received from future sales. I get it !!!! We the tax payer may get it back if they survive. I hope!!!!! This with all freshly printed money. I get it !!!!

Now, the local politicians , major city mayor’s, and state goverments are posturing for thier’s. Last I checked the local and state goverments could not print money. That means we the tax payer have to pay it back. We can’t!!!!! The end game won’t work!!!!!

Do we really believe that a infastructure stimulus package to rebuild roads, bridges, tunnel to NYC, build schools, and hospitals is what we need ? We may need all those projects but do we really believe that this is the type of work the estimated 150,000 Wall Street unemployed types or the estimated 243,000 service industry types can or would do. I think not.

We are in deep do0do0!!!!

Well, of course most of us reading this has asked the very question that Barry has posed:

“Here is the question I cannot figure out: Why are the automakers treated so differently than the banks?”

I think that the whole scale of the difference is mind-boggling as well. Barry has noted several times the true cost of the whole financial system bailout (several trillion always ratchetting upwards), vs. a petty 15 $ billion (or 35, but who cares, it’s a tiny number in comparision) for the auto companies.

I’ll weigh in with 2 quick observations:

1) Congress seems to be dictating that one of the changes that the automakers must address is the milage that their fleets get, and a move towards hybrids. I find this humorous on several levels.

With gas at a “reasonable” $1.65 per gallon, the public appetite for paying a premium for a hybrid seems to have waned. I fully expect that gas and oil prices will again rise, timeframe unknown, and that hybrids or electrics are the way to go. Obama has been given a gift of low oil prices, the time to really encourage vehicles that get great milage is here.

Didn’t the congress for years never mandate an increase in the CAFE standards? Wouldn’t this have been a way to “encourage” the automakers to do what they should have been doing all along, IN a climate of higher gas prices?

Lastly, the latest sales figures of the big 3 are all WAY down. They need to build cars that we’ll buy!! But wait, if you look at sales figures from Toyota and Honda, they are down a comparable amount. Apparently Americans aren’t buying their cars either. Could it be that at this point in time, it’s not the type of car out there, but perhaps that either the consumer has pulled way back, or that he/she can’t get financing?

2) I’m in favor of the auto bailout, if for no other reason that the big 3 actually make something in the country. It’s one of the few products that is still indeed made here. And according to JD Powers, initial quality is comparable or superior to Toyota and Honda.

Anyway, there are my .20c (yes, .20 vs. .02) worth of insight.

Disclosure, Long Honda (2003 Civic Hybrid), Long Subaru (2007 Forrester), Long Volkswagon (95 Cabrio), Long GM (67 Camaro Conv., in dire need of restoration).

December 9th, 2008 at 8:01 am
Ted…that’s a good start, but misses the key takeaway…the root cause of the meltdown is too much debt in all aspects of society…the American consumer is addicted to debt…the government is addicted to debt and the Federal Reserve, with Greenspan greatly responsible, printed all the money and fostered the moral hazard for the debt to be created. Wall Street was more than willing to help out by leveraging up 40 to one and collecting all those fees for selling the debt to the world.

needs to be used, as a lever, against this: “Sadly, neither camp has the answer this time around. Humanity has reached a significant physical limit to growth—Peak Oil—that will spell ruin to all economic philosophies that fail to take such limits into account.”

LSS: There is a Grand difference between Finance and Economics. Steve Barry, above, properly alludes to the Financial basis–that demands exponential Growth(it’s in the Math)–that is the, current, foundation of our Economy. As has been pointed out, above, Nature abhors exponential growth–of anything.

Economics, simply defined, is, merely, the study of Man’s rationalization of limited resources, in the face of unlimited desires..

to borrow from someone else: “We didn’t leave The Stone Age b/c We ran out of Rocks.”

It is Human Action, spurred by our Imaginations–the Product of our greatest Asset–our Minds, that will tell of our future limits–not, hardly, Malthusian ‘Resource Depletion’..or, lack of Fictious units of Account produced behind some curtain..

And, to bring this up again, for all the talk of ‘Natural Limits’, I’m, really, surprised that there’sso little interest in Economic Fractalism..
http://www.icerocket.com/search?tab=web&fr=h&q=Economic+Fractalism&x=27&y=3

Adjustment, guess what? Here We come..

The driver of Steve Barry’s chart is the AVAILABILITY OF CREDIT. That relates to banks who lend, credit bureaus and creditors that rate consumer borrowers, and rating agencies who rate companies.

Lots of debt isn’t a bad thing if the borrowers can repay it. It is the ability to determine the probability of default that is at the heart of the matter.

As it currently stands, there are too many conflicts of interest and not enough oversight over the various assessment functions.

Things are fine if the regulators regulate the private sector responsibly.

(When the regulator becomes the borrower, well, that’s a whole different ball of wax – and not particularly pertinent to the current crisis. A rising USD is testament to that fact.)

Ted