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By Joan Veon
September 24, 2008

Americans are besieged by the current catastrophic economic events. How does one know what is truth?

Truth is dependent on assumptions between what a person has heard and if that person is a seeker of truth. Pontius Pilot, when confronted with the Pharisee and Sadducees demands for Jesus, asked “What is truth?” Interestingly, that question has transcended time and eternity. Either you believe what Paulson, Bernanke, and the circle of insiders are telling us, or you hear in their words lies, deceit, and deception.

Americans are all to familiar with the fallout from a financial crisis by what has occurred in other countries: homeless citizens, obliterated industries and a collapsed currency (economy). It appears now that this could be America’s misfortune. The public is being asked to first, hand over a $700B bailout in taxpayer’s money, and second to transfer the last vestiges of their financial power to the Federal Reserve through the approval of Treasury’s proposed “Blueprint for a Modernized Financial Regulatory System.” Once both of these events are completed, America will become a shell of what she was at the height of her glory. The consequence to America’s financial cleansing, is that her middle class will be effectively rendered serfs as the wealthy become much richer.

Our once manageable subprime crisis has mushroomed into a catastrophic problem in that the Federal Reserve, via the Treasury, is demanding that the American people pay $700B to $1T to shoulder the debt of the public-private partnerships of Fannie Mae and Freddie Mac. In 1998, Vice President, Al Gore convened the first global meeting on “Reinventing Government,” thereby staging a goal to turn every major governmental asset; water facilities, sewers, roads, bridges, etc., into public-private partnerships (half government and half private sector entities) or GSEs. If they all turn out like Fannie and Freddie, we will never recover. (Public-private partnerships are being touted by Prince Charles, the United Nations, and our own Congress as incredible opportunities. I wonder if they care to re-think their program on how to restructure our government, which they began 10 years ago.)

Truth be told: The Federal Reserve Bank (America’s Central Bank) will buy-up all the Freddie/Fannie mortgages, and perhaps other loans (collateral), by loaning money to the U.S. Treasury (bailout). The taxpayer will be responsible for repaying the debt, however the Feds will hold the collateral and can call it due and payable at anytime, thereby holding America by her peninsulas.

Six months ago, U.S. Treasury Secretary, Hank Paulson unveiled the Blueprint. No wonder they want to transfer the Fannie and Freddie debt to the taxpayers! In the proposed Senate bill, which has yet to be numbered, you will find their proposal to set up the “Fannie and Freddie Emergency Oversight Board”, and, in which, the Federal Reserve will become its chairperson. Amazing! Why is Congress blind to what the average American can see? Next thing you know the Fed will want to disband Congress and the Executive Branch. The stakes are very high for the booty of America to be handed over to pirates Paulson and Bernanke, that their every word constitutes a veiled threat.

In today’s testimony a number of senators voiced their surprise at hearing the fine details, like the buying up of our second lien mortgages and auto loans, and that foreign central banks are financially contributing to the bailing out America. Some voiced concern about all the unknowns of this newly proposed system and their need to push legislation through fast. Some voiced concern about how they would face their constituents (a good thing). Some voiced concern about the ambiguities of what is or is not being proposed so they can better understand. The gentleman from Kentucky, Senator Bunning, questioned Paulson intensely regarding newspaper reports of Paulson’s proposal to include student loans and credit card debt in the bailout. Paulson’s response was that he “asked for broad powers” and that he wanted “flexibility to buy other types of assets to keep the entire system [cleaned] up.” When pressed by Bunning, Paulson backed down, but not without making it clear, “I am trained to run towards problems.”


Many senators put forth several very sound ideas and alternatives, however Paulson and Bernanke continued to sing their same old song, “We need to act quickly.” Interestingly, at the beginning of the day the Dow futures were going up, but by the end of the day, following the testimonies of Paulson and Bernanke, who were calling for fast action, the Dow closed down over 170 points.

For the past two weeks I have been transcribing the conversations taking place on CNBC and am amazed at the number of times I have heard “there is a need to act quickly or else”, and how fortunate America is to have one of the world’s leading authorities on the Great Depression heading the Federal Reserve. One has to wonder if that was the real reason for appointing Bernanke?

Commentary follows:

September 23
Interview with Michigan Governor Jennifer Granholm

CNBC, Becky Quick: “We need to act quickly. If Congress cannot agree, do you want to take time to work it out?”“
Governor: “Whether this week or next week, there has to be something in it for those paying the bills.”
CNBC commentator: “Markets wonder if they are going to open orderly every day. Are you willing to take ten days to risk it?”

Interview with NASDAQOMX CEO Robert Greifeld

“Last Thursday, Morgan went to $13 at 11:30 a.m. In addition there was more shocking news that mutual funds were being shut down. It was a dangerous time to be in the market. Clearly we need Congressional oversight to plan and, if we do that, and get the plan approved by the week end, I think we will see better times going forward.”

Interview with former Federal Reserve Board of Governor, Professor Frederic S. Miskin

“Look at history when people dilly dallied in these situations. Horrendous things can happen. The faster you act versus contemplating your navel…The reality is [that] the financial system is the same as the Great Depression—the shock is worse and more complicated. We have to get it done to stabilize the markets. Without that, the discussion about the future is moot.“

On Sunday, September 21st, Hank Paulson did the rounds on a number of talk shows. This is, in part, his interview with Chris Wolf:

Chris Wolf: “Will you bail out hedge funds?”
Paulson: “It is not our intention.”
Wolf: “What guarantee do we have that they will be worth anything?”
Paulson: “There are no guarantees, and the taxpayer is at risk. This is not a spending program. The funds would buy and sell those assets and the monies will come back into the treasury. Cost will be determined by how quickly the economy recovers and again, I hate the fact that we have to do it, and it is better than the alternative. Once we stabilize the markets—we have regulatory system that is broken, outdated, and needs to be updated. This program is designed to minimize the cost to American public and taxpayer. There is greater risk in not doing it.”

When the currency crisis happened in Indonesia, a businessman, who is acquainted with a friend of mine, was gravely affected. His business was worth $40M and he had a small mortgage at a large bank that failed during the crisis. Although he continued to pay the principal and interest payments on the loan, the bank called it in and he could not refinance. The bankers took his business, house, and everything. Interestingly, the IMF came to the rescue of Indonesia, providing a bailout, and creating their own type of Resolution Trust. One unit of the agency was in charge of loan restructuring and the other was in charge of the disposal of equity holdings. In the end, the entire Indonesian banking and economic systems, apart from a handful of foreign banks, were nationalized.

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Can you see a parallel between Indonesia and the proposed American bailout? Fannie and Freddie have effectively been nationalized. Paulson is setting up a Resolution Trust type of corporation to deal with not only what appears to be the real estate and mortgages of Fannie and Freddie, but may include auto loans, student loans, second mortgage liens, and any other unveilings that come with Treasury’s wants for “broad powers.”

In the end, this is a one-two punch-transfer of wealth being delivered to America’s financial sovereignty; one, the bailout; two, the passage of the Blueprint. Can America escape what many other countries have suffered at the hands of the very strong central banks who control the world’s monetary system?

� 2008 Joan Veon - All Rights Reserved

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Joan Veon is a businesswoman and international reporter, who has covered over 100 Global meetings around the world since 1994. Please visit her website: To get a copy of her WTO report, send $10.00 to The Women's International Media Group, Inc. P. O. Box 77, Middletown, MD 21769. For an information packet, please call 301-371-0541













The once manageable subprime crisis has mushroomed into a catastrophic problem in which the Federal Reserve via the Treasury is demanding that the American people pay $700 Billion to $1 Trillion to shoulder the debt of Fannie and Freddie.