"... The number of Problem Banks has increased steadily since 2007 and now totals 888 banks or almost 12% of all FDIC insured institutions. With the economy weakening and property values declining, most Problem Banks find it impossible to raise the additional capital required to meet minimum regulatory capital ratios. It would not be surprising to see the list of Problem Banks continue to expand in the future. ..."
Reich is a smart person. Too smart. He doesn't really communicate well. It took him almost an hour to explain what Upton Sinclair wrote in one paragraph in 1933: ... My dad said it even more succinctly in the 1970s
But pull enough capital, and no amount of confidence can indefinitely replace it. And we're approaching 4 years, now, after the initial credit markets lockup of late 2008. The first big lawsuits going to trial/settlement are not likely to put back even all that has been lost, so far, much less what will still be lost in the near future.
I get it; you're not a Sam's Club member, a Target shopper, or an Exxon stockholder. Good luck with your program for revitalizing America.
The comparatively fast, but horrifically unpalatable solution is to take the hits of as orderly an unwinding as we can still manage in the financial world, even if that means a significant worldwide depression, on the premise that once we've cried our puddle of tears, and know what is real and what is smoke, economically, we can move forward with some confidence, rebuilding as needed from the smoldering ruin. But that's politically impossible, worldwide.
The argument is that if you can't find worthwhile, low risk deployments for your capital in today's quasi-zombie economic climate, good luck and God speed if the world does slip into deep recession, or even depression, despite the best plans of governments and central bankers, the speeches of leading politicians, and the pronouncements of Reich.
And you used to have Rubbermaid products made in Ohio, but machinery can be crated up and moved and "talent" is available over-rated. Anyone with access to books can learn everything you know.
As an example, Frontline had a nice program on the demise of Rubbermaid's US operations a few years ago. Is Walmart good for America?
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