Update: Much of what I have written below has come true. America is now deep into debt to the banks, and a few privileged banks are gambling at the casino of swaps and bets like no meltdown occurred. But as of October, 2009, this credit crisis is not over, the banks are not out of the woods, and the Fed is buying all the mortgages, lending at low rates so banks make money while depositors are impoverished. I have a bad feeling about the future of this crisis. I don't think that the reflation by the Federal Reserve will work, and it may turn out that all that money given to the banks will have proven to be wasted. As of this month, 90 percent of the alt a liar loans have not reset, and that will, along with higher capital requirements, keep our big banks zombies for years. Geithner and Summers continue to steal for Wall Street, making the Obama presidency a failure, as was the Bush Presidency. More later.

Update: The alt a chart shown below has been modified on a pdf chart which I am adding. Please note that the new chart reflects the refinancing and kicking the alt a can down the road. It show that the resets have been pushed out through 2013! This greatly extends the potential downturn years out and puts the big banks in jeopardy years into the future.

The ponzi housing scheme that ripped us off was created by George Bush and Alan Greenspan to finance the War for Oil in Iraq and make money for the international cockroach bankers. But the screwing of the middle class is continuing.

I have a list of websites that deal with each facet of this issue, but you middle class people better watch out, because you remain under attack. And you are being attacked by the financial sector which controls your government.

Do not be deceived, until further notice the banks are in control. The banks, with the power of the federal reserve behind them, or in front of them, are in control. The 40 percent stake that the government is taking in Citibank is not nationalization like the Savings and Loan crisis, but rather it is fascism. They are putting enough money into this bank to control more than 80 percent. Yet they are only taking a minority stake. This is fascism and the war on the middle class continues.

But then, on top of this, we are going to be issuing a massive amount of government bonds that will come with higher interest rates. In order to offer these interest rates, the government will have to print more money. This will cause a massive inflation. Now we all know that inflation is not the problem now. We have to fight deflation, and certainly it would be irresponsible not to. But the government is a slave to the credit default swaps that surround all the bonds of the banks, of the car companies, and of the insurance companies. If these companies fail the CDS or Credit Default Swaps will put the wealthy class in danger of serious hurt.

Therefore, it is the financial system's mad idea to continue to kill the goose that laid the golden egg, the middle class, while they prop up the bonds. Why are they doing this you say? Well, it is simple. The bonds of the corporations have been layered by credit default swaps. So if you have a corporation that has a billion dollars in bonds, and has 10 billion dollars of cds insurance on those bonds, the default will cost investors 10 billion dollars, not 1 billion dollars.

So, they think they can do a little stimulus for the middle class and all will be hunky dory. But I say that will not be the outcome. I believe that the middle class will lower spending for years and years and years.

So, I guess I need to list the ways we are going to being screwed as a middle class by the financial system:

1. Bonds of major companies will be protected because the CDS insurance cannot fail without hurting other governments, banks, and the rich.

2. Banks and insurance companies will get massive infusion of money from taxpayers but the bonds won't be allowed to fail. It is better to kill the middle class than to allow the rich to lose their investments (and the foreign banks who bought the toxic investments).

3. Inflation will go crazy and interest rates will go through the roof, but only if we beat deflation. But this beating deflation will come with a huge inflationary tax upon the middle class once this is over.

4. The credit rating of the United States could be lowered because of all the money we are giving to protect the rich and their CDS exposure. This will cause higher interest rates for the middle class. The rich don't need to borrow.

5. I have a debate with another hubber here on hubpages about whether the conspiracy by the banks extends to a refusal to lend. I don't have an answer at this point. I believe that the government conspired to inflate housing prices. I do not yet have enough proof that they are doing anything but protecting their capital. But clearly, the banks are controlling the government and are fleecing the taxpayers. It is sickening what they are doing and the middle class will pay dearly.

6. The guy who buys a house in this environment could have one of two very bad things happen. First, his house could continue to go down in value and the deflation could kill his house value. Or second, he may need to sell later when interest rates are sky high. It will put the value that he invested into the house in jeopardy to sell into sky high rates.

I am responding to a smartly written article about how the US trade deficit is widening, just the opposite of what is wanted by Summers and Geithner, President Obama's two stooges of economic advice. I wrote:

"The plan, led by Larry the moron Summers, was to forget about the middle class here, and just export our way out of this recession. He is a fool. He cannot see that we can't export enough and our consumer is king. If the consumer is dead we have no king and the world is screwed."

Now I hope I am wrong. I don't think that I am. Unless there are changes to the American way of life, specifically help for the consumer in the form of asset deflation, I don't think that we can export our way out of our financial difficulties.

Update: We are worried about the dollar and the possible precipitous fall of the dollar that will result in the need for a weak economy to have imposed upon it sky high interest rates. This will ruin many who are trying to make money on the carry trade. Even this 1994 prediction by a billionaire capitalist, Sir James Goldsmith, is proof that GATT and global capitalism is pitting corporations against the society and the common man, where the economy grows while unemployment and society is destroyed. Charlie Rose has a female foil, Laura Tyson, who, as we see today, is just totally wrong. Don't listen to the happy talk of this female pumper of this system. She is a LIAR.

If you think that Laura is wrong, just do what I did and email her here at her current location:

tyson@haas.berkeley.edu

CIT group, not to be confused with Citibank, who went bankrupt on Nov 1, 2009, is a key lender to small business in the US. Geithner, fascist pig that he is, gave 2.3 billion to this company, and the government and you taxpayers will lose every penny of that money. Indeed, the bondholders will only take a 30 percent hit, you know, like Goldman Sachs. But did Geithner put US taxpayer interest at the head of the line in front of Goldman Sachs? Hell no he didn't.

I wish that down the road this man reaps what he sows. I hope he dies penniless. No one deserves it more, unless you count Henry Paulson, who shorted the very real estate bonds that he sold while at Goldman Sachs, without bothering to disclose this fact to pensions fundsa and investors. When will this country come to her senses? These thieves deeds reach up to heaven while the US citizen sleeps! Think I am angry today? You bet.

Here is the lesson of this theft. I am not the only one thoroughly disgusted that the taxpayer is getting ripped off. If you can get away with not paying taxes it would be patriotic at this point.

Meanwhile the casino plays on and that is and will be a rip off of the consumer and small investor which ever way it plays out!

That is a harsh charge but it is the truth. Geithner is a federal reserve man. linked to the front for International bankers, the Council on Foreign Relations, (CFR). He is an enemy of the people, the middle class, and he is determined to rape them until they will no longer be able to breath. It is essential that his idea to get a minority stake with a majority investment into Citibank be stopped. It would be a bad deal for the US government to get an 80 percent of the stake.

Bottom line, the big banks have massive exposure to CDS insurance, to Alt A and option arm loans, and their bonds could be worth little. Yet the fed is so afraid that the rich and other governments will be hurt by defaults on mortgage, then corporate bonds and then on their speculative CDS phony insurance.

Well, Geithner, if you kill the middle class it won't matter that you save the banks. You will save them for nothing. Save the middle class instead Geithner. The US middle class accounts for world prosperity. Our spending accounts for 70 percent of the US GDP. Without our spending there will be no world recovery. We already know you don't respect us because you didn't pay your taxes moron.

People can see here the Alt A Meltdown Chart.     New chart in PDF.

Know this, middle class, it is fascism to raid the treasury of the United States to bail out corporations when that bail out will cause inflationary tax. I don't have a problem with a small bailout of a strategic corporation. I have a big problem with this mass bailout of everyone, especially the financial sector. And the automakers may take a bond hit because they are selling so few cars, although the bailout could put the banks at risk. Still the banks will be protected unless they completely melt down. And even then it is likely that the banks and their counterparties, the hedge funds, will be protected at the expense of the taxpayer.

You certainly know that we are fighting deflation. But the way to fight deflation is not to put the treasury money down the black holes of these banks, AIG, etc. The way to fight deflation is to understand that the American consumer is 70 percent of the American GDP. Yet this policy of feeding the banks, with a fascistic control by the banks rather than a real temporary nationalization, a dismemberment of the banks, will impoverish the middle class even more. First banks stole through the ponzinomics of Basel 2 and now they want to raid the treasury. See links below for more on Basel 2.

Geithner this is a call to you to quit destroying the middle class. Stimulus should be for jobs, and NOT for banks. Take them over and tear them apart. And do it fast or you will go down in history as the most vile politician since Hitler and Bush 2.

You won't be a murderer, but you will cause death and destruction if your plan doesn't work. Bottom line Geitner, do a real nationalization, not a fascistic submission to the will of the banking system. And do it quickly!

And know this Geithner, if this little scheme of yours fails, we need to take back the coining of the currency and destroy the federal reserve forever. You are just a part of the Basel II, off balance sheet scam against the nations by the international bankers. You don't fool us! Here is a link to an explanation of your evil banking designs at Damn International Bankers which is my description of this great article.