The United States did NOT get into this abyss accidentally because of random honest mistakes and bungling!

VHeadline commentarist and money market expert Fred Cederholm writes: I've been thinking about lulls ... about disturbing quietness, the $1.505 TRILLION bailout, the next shoe, and investigations. I am actually quite disturbed by the relative quiet. Last week's absence of stories about the ongoing saga of economic/financial unwindings that have been plaguing the US (and the rest of planet earth) make you feel calm or safe when it is not reasonable or justifiable to feel this way.

Relaxed vigilance leads to a deceptive trustfulness. We NOW need to question everything and everyone.

You see "the powers that be" in Washington DC and on Wall Street seem to have gotten a reprieve from the blanket (and blank check) $1.505 TRILLION bailout package that was railroaded thru Congress and signed by US president George W. Bush almost two weeks ago. This will do nothing to fix a crisis of insolvency as it replaces one burden of debt with an even larger one down the road. It bought some time (for now), but that was all it accomplished. THAT was the unmentioned goal because this is an election year.

The US Presidential candidates, one-third of the US Senate, and the total membership of the US House of Representatives are up for election/re-election on November 4. They wanted to get on with their campaigns. Coming up with a real solution was NOT something they wanted in the weeks before Election 2008.

Besides … the $1.505 TRILLION band-aid we saw wasn't really THEIR money!

Under-the-surface rumblings suggest that more crises are looming on the horizon. Will the next shoe to drop involve the US auto making giants? Will it involve one or more major airlines? Will it be the property-casualty insurance companies?

Will it be one (or more) major pension fund(s)? Will it take down a US city? Will it shut down any one of several state governments tottering on the brink?

Any/all of these will have their hand out for an infusion of money from Uncle $ugar?

• We have morphed from the nation of "E. Pluribus Unum" (from many … one), to the nation of "Ubi Est Mihi" (Where is mine?)

Thus far, nine major banks or financial institutions have bought into (or rather sold out to) the hybrid bailout feature of accepting Uncle $ugar as an equity investor -- they had no choice. The tab on these is looking like a further $250 BILLION of emergency infusion capital. This is unheard of in our nation's history!

Will Uncle do the same for the auto makers, the airlines, the insurance industry, the telecom industry, the fast food industry, or…?

Once the public purse is opened, where does it stop?

In all this brouhaha, the snips and snippets of media coverage summarily have one significant omission. Where is the hue and cry for justice? Where is the outrage over the wanton disregard for accountability?

We did not get into this abyss accidentally because of random honest mistakes and bungling!

This crisis did not blossom from a series of isolated incidents!

Criminal actions were made consistently over a long period of time -- driven by a pervasive greed and profit motivation.

Who was minding the store?

Who will seek recovery from the culpable parties? Why only ding the taxpayers?

Fraud is not an easy case to pursue. It involves direct misrepresentation of material facts (knowingly done) upon which reliance is placed and a loss incurred. All "points" must be proven by the prosecution. Last week we learned in only ONE US news article how the FBI had all but liquidated their white collar crime investigative unit ... they had channeled their investigative efforts on counter-terrorism. The primary investigative arm of the US Government had virtually no one watching the "domestic financial hen house."

Now they must struggle to re-build (after the fact) a white collar crime unit.

Civil actions are an alternative legal route. Some shareholder/class action cases are now only surfacing in the courts. At the RTC working as a forensic accountant on the Savings and Loan debacle, I helped develop major civil cases seeking recoveries from insurance underwriters on fidelity bond, errors and missions, and professional liability claims.

Could the apparent absence of any such cases now have to do with Uncle $ugar not wanting to put any added (financial) stress on the insurance industry?

Fred Cederholm
asklet@rochelle.net

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Venezuela is facing the most difficult period of its history with honest reporters crippled by sectarianism on top of rampant corruption within the administration and beyond, aided and abetted by criminal forces in the US and Spanish governments which cannot accept the sovereignty of the Venezuelan people to decide over their own future.

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