Though data shows that the U.S. economy only shrank at a one-percent annual rate during the second quarter of the 2009 calendar year, according to “preliminary” data released July 31 by the U.S. Commerce Department’s Bureau of Economic Analysis (BEA), that number may be unrealistically low, owing to government involvement in the markets.
Capital lending firm-turned-bank holding company CIT has patched together another $3 billion private loan to avoid bankruptcy and try to complete the transition to bank holding company.
Federal Reserve Chairman Ben Bernanke is on a public relations offensive to persuade Americans that he has the economy well in hand, and that he has an “exit plan” for the Fed's inflationary monetary policies if consumer prices should start to rise precipitously. Bernanke does see a time when banks are lending more freely, and the fractional reserve system for banks would again put additional inflationary pressure on the economy.
President Obama’s Auto Task Force Chairman Steven Rattner resigned suddenly earlier this week after reports that the New York Attorney General’s office was investigating Rattner’s role in a New York State pension bribery scandal.
Item: Writing in the online Newsweek for June 2, Daniel Gross observed: “It’s been a long time since American devotees of Marx … have had much to cheer about. But with the bankruptcy filings of General Motors and Chrysler, and the transfer of stock ownership from the firms’ long-suffering shareholders to the government and unions, communists of the world can rejoice. The workers are now, finally, significant owners of the means of production. The United Auto Workers control about 65 percent of Chrysler and 17.5 percent of General Motors.”