More from The New York Times:

“In addition to the debt assistance, the administration has thrown its support behind a $4.8 billion loan being negotiated between Egypt and the International Monetary Fund. Last week, it dispatched the first of two delegations to work out details of the proposed debt assistance, as well as $375 million in financing and loan guarantees for American financiers who invest in Egypt and a $60 million investment fund for Egyptian businesses.

The assistance underscores the importance of shoring up Egypt at a time of turmoil and change across the Middle East, including the relatively peaceful uprisings in Egypt and Tunisia, the still-unfinished transition in Libya, the showdown over Iran’s nuclear program and the war in Syria.

Given Egypt’s influence in the Arab world, the officials said, its economic recovery and political stability could have a profound influence on other nations in transition and ease wariness in Israel about the tumultuous political changes under way.”

Note:  The U.S. government is a 17% stakeholder in the International Monetary Fund.  What does that mean?

WSJ Sep 5, 2012:  “The IMF is akin to a global credit union. Members kick in money. The institution’s board lends it out.

Each member has a “quota”—that is, a financial stake in the IMF, expressed as a percentage—and contributes accordingly. The U.S. quota is 17.09%, followed by Japan at 6.12%, Germany at 5.98% and France and Britain at 4.94% each.

Does that mean that the U.S. is responsible for 17% of the IMF’s portion of the Greek package? Not exactly.

First, though all countries are theoretically responsible for investing in the IMF’s lending pool, not all of them have currencies that potential borrowers can use. (Think of Zimbabwean dollars or Venezuelan pesos.)

The IMF doesn’t say that outright. Instead, it uses the concept of “usable resources,” meaning it uses money from countries that are considered financially sound. About 21% of the quota contributions to the IMF were “non-usable,” according to the IMF, as of January 2010.

Because the U.S., Japan and big European countries are in the “usable” camp, they finance a larger percentage of IMF funding than their quota would suggest.”

………………………

The U.S. taxpayer is ‘standing behind’ a large share of the $4.8 billion IMF loan package to Egypt – well over $800 million.  Egypt also receives $1.3 billion per year as a military assistance package from the U.S..  And they just received a $1 billion loan write-off from the U.S. Government.

………………………….

There is no legitimate reason why, if the U.S. Government can extend funds to foreign countries (no collateral involved) and forgive loans to those same countries (with no collateral obligation required), that U.S. citizens should not also be granted the same equal access to direct credit extensions.

After all, it is our money.

The Leviticus 25 Plan would pay for itself – over a 10-year period.  And it is fully collateralized.

The Leviticus 25 Plan.

(In other words, government-based ‘Central Planning’ is not working.  And will not work in the future…)

The Morgan Stanley report goes on to conclude, “In short, it is impossible for governments to grow their way back to solvency.”  All they can do is shuffle debt around, ostensibly for the benefit of powerful, politically connected  constituencies.

And (brace yourselves…) the IMF advises that “Tightening” is the solution – even though “Tightening Hurts.”

The U.S. Government has provided trillions of dollars of funding (TARP, stimulus programs, bailouts) to major credit institutions and politically-connected constituency groups.

In addition, the Federal Reserve has purchased European debt – of all things.  They have provided trillions of dollars in credit extensions to many of the very domestic and foreign banks that triggered the banking crisis in the Fall of 2008.

One of the more ‘visible’ bailouts came courtesy of the  U.S. Government  on behalf of Goldman Sachs.  Goldman had purchased credit default swaps (CDS’) from AIG and didn’t happen to verify that AIG had adequate reserves to cover the CDS’ (derivatives).  They didn’t.  When the ‘you-know-what’ hit the fan, AIG turned their pockets inside out (no money).  And the U.S. Government (that is to say, ‘taxpayers’) stepped in to ‘cover’ the massive Goldman bet that went sour:

“…according to the terms of the bailout deal struck when AIG was taken over by the state in September 2008, Goldman was paid 100 cents on the dollar on an additional $12.9 billion it was owed by AIG”

Read more: http://www.rollingstone.com/politics/news/wall-streets-bailout-hustle-20100217#ixzz21kDwPRyY

And on to the Federal Reserve ‘rescue’ initiatives…

Federal Reserve – credit extensions – allowing two major investment banks (Goldman Sachs and Morgan Stanley) to quickly receive commercial bank charters, allowing them to qualify for near-zero interest rate loans, with which to purchase Treasuries – and earn ‘free money.’  Lots of it.

Federal Reserve – Primary Dealer Credit Facility (PDCF) allowing major banks to pledge sub-investment grade collateral to qualify for additional near-zero interest rate loans – with which to purchase Treasuries and earn more ‘free money.’

Federal Reserve – Temporary Liquidity Guarantee Program (TLGP) for the big money center banks… ‘worth trillions.’

Federal Reserve – Public Private Investment Program (PPIP) – allowing banks to ‘off-load’ worthless assets onto the Fed balance sheet.

Again – government-based ‘Central Planning’ is not working.  And will not work in the future…  America is sinking deeper into the debt hole.  Economic growth is stagnant.  And for all of the trillions of dollars the government has ‘thrown’ at the problem, the average American family has benefited very little, if at all.  In fact you could make a strong case that things are getting worse.

America doesn’t need the type of “Tightening” the IMF and Morgan Stanley are talking about.  America needs liquidity and debt relief at the Family level.

It is time now for a new initiative.

The Leviticus 25 Plan will provide American families with the same access to liquidity (credit extensions) that the Federal Reserve has been granting to the banks.

And The Leviticus 25 Plan will pay for itself over a 10-year period with the ‘recapture provisions.’  And the ‘ripple out’ effect will yield efficient benefits for government tax revenues, small business revenues, the labor market, housing… and even banks – in the long run.

No other plan will deliver such benefits and set America back on course for financial stability and economic liberty for American families.

Precisely.

And The Leviticus 25 Plan is the practical application of that concept.  It delivers direct credit extensions to the citizens of a given nation, thereby strengthening the base –   rather than continuing to extend credit to major financial centers, faltering from poor asset (loan portfolio) performance.

The Leviticus 25 Plan will provide for massive debt relief at the family level.  Economic acceleration.  Government cost savings and robust tax revenue growth – all with-out raising taxes.  This Plan will reincentivize work, industriousness, wise decision-making and productivity.

It will relight the fires of economic liberty for citizens.

…………………………………………

Keen continues: “I think the mistake [central banks] are going to make is to continue honoring debts that should never have been created in the first place. We really know that that the subprime lending was totally irresponsible lending.

When it comes to saying “who is responsible for bad debt?” you have to really blame the lender rather than the borrower, because lenders have far greater resources to work out whether or not the borrower can actually afford the debt they are putting out there.”

“They were creating debt just because it was a way of getting fees, short-term profit, and they then sold the debt onto unsuspecting members of the public as well and securitized their way out of trouble. They ended up giving the hot potato to the public. So, you should not be honoring that debt, you should be abolishing it. But of course they have actually packaged a lot of that debt and sold it to the public as well, you cannot just abolish it, because you then would penalize people who actually thought they were being responsible in saving and buying assets.”

“Therefore, I am talking in favor of what I call a modern debt jubilee or quantitative easing for the public, where the central banks would create ‘central bank money’ (we cannot destroy or abolish the debt, which would also destroy the incomes of the people who own the bonds the banks have sold). We have to create the state money and give it to the public, but on condition that if you have any debt you have to pay your debt down — no choice. Therefore, if you have debt, you can reduce the debt level, but if you do not have debt, you get a cash injection.”

Spiraling global debt and economic deceleration …

“Europe is imploding under its own volition and I think the Euro is probably going to collapse at some stage or contract to being a Northern Euro rather than the whole of Euro. We will probably see every government of Europe be overthrown and quite possibly have a return to fascist governments. It came very close to that in Greece with fascists getting five percent of the vote up from zero. So political turmoil in Europe and that seems to be Europe’s fate.”

“I can see England going into a credit crunch year, because if you think America’s debt is scary, you have not seen England’s level of debt. America has a maximum ratio of private debt to GDP adjusted over 300%; England’s is 450%. America’s financial sector debt was 120% of GDP, England’s is 250%. It is the hot money capital of the western world.”

“And now that we are finally seeing decelerating debt over there plus the government running on an austerity program at the same time, which means there are two factors pulling on demand out of that economy at once. I think there will be a credit crunch in England, so that is going to take place as well.”

“America is still caught in the deleveraging process. It tried to get out, it seemed to be working for a short while, and the government stimulus seemed to certainly help. Now, that they are going back to reducing that stimulus, they are pulling up the one thing that was keeping the demand up in the American economy and it is heading back down again. We are now seeing the assets market crashing once more. That should cause a return to decelerating debt — for a while you were accelerating very rapidly and that’s what gave you a boost in employment — so you are falling back down again.”

“Australia is running out of steam because it got through the financial crisis by literally kicking the can down the road by restarting the housing bubble with a policy I call the first-time vendors boost. Where they gave first time buyers a larger amount of money from the government and they handed over times five or ten to the people they bought the house off from the leverage they got from the banking sector. Therefore, that finally ran out for them.”

“China got through the crisis with an enormous stimulus package. I think in that case it is increasing the money supply by 28% in one year. That is setting off a huge property bubble, which from what I have heard from colleagues of mine is also ending.”

“Therefore, it is a particularly ugly year for the global economy and as you say, we are still trying to get business back to usual. We are trying to rescue the creditors and restart the world that is dominated by the creditors. We have to rescue the debtors instead before we are going to see the end of this process.”

Full report submitted by Chris Martenson – accessed from ZeroHedge: http://www.zerohedge.com/news/steve-keen-why-2012-shaping-be-particularly-ugly-year

The financial news wires report analyses every day which reveal the ‘cracks’ in the current economic track that our government has us on – and why continuing down this road is an exercise in futility.

One recent analysis sums things up well (and shows why we need an economic acceleration driver like The Leviticus 25 Plan’s direct credit extensions for American citizens):

Financial Blogger, Matt Taibbi (TAIBBLOG – May 8, 2012):

 1. Let banks inflate massive asset bubbles with the aid of cheap or even free government cash, and tons of leverage;

2. Before it all explodes, carve out gigantic sums for bonuses and compensation for the companies that inflated those bubbles;

3. After it explodes, get the various governments to bail those companies out;

4. Pay for it all by slashing services to what’s left of the middle class.

This is the model we used in America. We had a monster asset bubble based on phony mortgages, which Wall Street was allowed to inflate to spectacular dimensions with minimal reserve capital, huge amounts of leverage, and tons of fraud for good measure. When that bubble exploded, we first rescued the banks who inflated the thing in the first place…

Source: http://www.rollingstone.com/politics/blogs/taibblog/austerity-cant-be-a-one-way-street-20120508#ixzz1uZKHj700

……………………………………………………………………………..

Meanwhile, massive debt continues to pile up in Europe.  Bloomberg recently reported on the heavy bond issuance coming next week in Europe – one of 2012’s heaviest:

* Monday May 14

• Spain to sell 12- and 18-mo bills
• Italy to sell up to EU3.5b 2.5% 2015 bonds
• Italy to sell 4.25% 2020 bonds
• Italy to sell 5% 2022 bonds
• Italy to sell 5% 2025 bonds
• Germany to sell EU4b 6-mo bills
• France to sell up to EU4b 92-day bills
• France to sell up to EU1.9b 168-day bills
• France to sell up to EU1.5b 351-day bills

• Tuesday May 15
• Greece to sell bills
• U.K. to sell GBP2.75b 5% 2025 bonds
• EFSF to sell up to EU1b 2% notes due 2017

• Wednesday May 16
• France to sell 0.75% 2014 notes
• France to sell 3.5% 2015 bonds
• France to sell 3.25% 2016 bonds
• France to sell 1.75% 2017 notes
• Germany to sell additional EU5b in 10-yr notes

• Thursday May 17
• Spain to sell bonds
• U.K. to sell GBP 1.5b 5% 2014 bonds

Source: Bloomberg

………………………………………………..

The world needs liquidity.

The Leviticus 25 Plan would deliver for America.

That works out to a rate of over 2,200 per day.  Every day in 2011.

While foreclosures eased slightly in March 2012 vs March 2011, “RealtyTrac expects banks will repossess close to 1 million homes this year.”

For 2012, that would work out to over 2,700 per day. Every day.  For the next 365 days.

The Leviticus 25 Plan, on the other hand, would ‘power up’ liquidity at the family level, providing debt relief and a strong dose of financial security to American citizens.  These benefits have been utterly lacking throughout the government’s orchestrated (‘central planning’) response to the ongoing, 3-year financial crisis.

The debt relief benefits of the Leviticus 25 Plan would provide the equivalent of what is known in the ‘derivatives’ world as direct “support of the underlying assets.”  Namely housing (with additional support for any other form of pledged collateral).

Daily American News – Apr 12, 2012 :  “At the end of last year [2011], some 1.5 million U.S. homes had mortgages that had gone unpaid at least 90 days, according to Mortgage Bankers Association data.

First-time foreclosure notices, such as warnings of initial default, are the first step in the process that can potentially result in a home being foreclosed upon. Homes can exit the process if the overdue payments are paid. Sometimes, a bank will allow that the home be sold for less than what the borrower owes on their mortgage, a so-called short sale.

All told, 101,939 U.S. homes received a first-time notice in March, the biggest monthly increase since October, RealtyTrac said.

Thirty-one states posted a monthly increase in homes with a first-time foreclosure notice. Nevada led the pack with an increase of 153 percent.

Even so, foreclosure activity overall — as measured by the number of properties receiving a notice of default, scheduled for auction or repossessed by lenders — sank in March to the lowest level since July 2007, the firm said.

In all, 198,853 homes received a foreclosure-related notice last month, down 4 percent from February, and down 17 percent from March last year.

Banks took back 55,075 homes in March, down 14 percent from the previous month, and down 25 percent from March 2011.

RealtyTrac expects banks will repossess close to 1 million homes this year.  Last year, lenders took back 804,000 homes.”

“The International Monetary Fund and Greece’s euro zone partners last week approved a second 130 billion euro ($172.15 billion) rescue to keep the debt-choked country afloat through 2014.”   (Reuters March 20, 2012).

“We received 5.9 billion euros from the euro zone and 1.6 billion euros from the IMF,” a finance ministry official told Reuters.

Note 1:  This equates to $2.12 billion (U.S. Dollars) ‘contribution’ from the IMF. The U.S. funds 17.7% of the IMF budget, so the U.S. Government has just ‘given away’ another $375 million to Greece/Europe.

Note 2: The total funding package for Greece, through 2014, is listed above as $172.15 billion. This means that the U.S. Government will be giving away’ significant additional amounts to “keep the debt-choked country [Greece] afloat through 2014.”  

The U.S. economy is currently on a ‘dead crawl’ pace.  Instead of giving our (future) tax dollars away to foreign interests, the U.S. government should be moving to provide direct credit extensions to American families.

America needs the Leviticus 25 Plan.

Treasury officials like to claim that all of the funds ($245 billion) dispersed under the Capital Purchase Program (CPP) have been repaid with interest – and that U.S. taxpayers have actually reaped a profit of $10 billion.

There is more to this story.  When the Fed highlights their TARP profits, they are only counting the positive payers.  They are not accounting for the those parties who have not repaid their TARP bailout frunds.  And they are allegedly not accounting for the market value of some of the ‘crap’ Mortgage Backed Securities (and other) assets on their books  – which they purchased with trillions of dollars.

Furthermore, according to the calculations of one group called Ethisphere, the TARP payback shortfall stands at a tall $148 billion.  This averages out to a debt of over $1200 for every American.  (Source:  Taibblog 9-1-09)

Capital Purchase Program (CPP) is a leg of the TARP bailout, whereby “Treasury bought preferred shares in the nation’s banks” to rescue many of the banks from failure.

Here are some of the big ones:

And here is the full list of the Bank recipients:   http://money.cnn.com/news/specials/storysupplement/bankbailout/

Remember that many of the ‘big players’ like Goldman Sachs, JP Morgan and others received sizeable credit extensions from the Federal Reserve at (near) zero percent interest, and were able to use those funds to purchase Treasury securities paying 3% interest – thereby gaining access to ‘free money’ to rebuild their solvency.  And pay back TARP disbursements to the Fed.

So, yes, many of the major players did repay the TARP disbursements – but they did it with the benefit of the ‘free money’ they had access to from other programs.  And that ‘free money’ giveaway by the Fed – does dilute the value of the U.S. Dollar.

And that ‘hits’ American families with higher prices for such things as food and energy.

Furthermore, some of the smaller banks actually paid back TARP bailout funds with other funds borrowed from the Small Business Lending Fund.  These included (July 14, 2011):

• Eagle Bancorp of Bethesda, MD: $23.235 million
• First California Financial, Westlake Village, CA: $25 million
• Cache Valley Bank, Logan, UT: $4.77 million, plus $263,000 to buy back preferred shares granted to Treasury in lieu of warrants
• Security Business Bancorp, San Diego, CA: $5.8 million, plus $290,000 to buy back preferred shares granted to Treasury in lieu of warrants
• BOH Holdings of Houston, Houston, TX: $10 million, plus $500,000 to buy back preferred shares granted to Treasury in lieu of warrants
• BancIndependent, Sheffield, AL: $21.1 million, plus $1.055 million to buy back preferred shares granted to Treasury in lieu of warrants
• York Traditions Bank, York, PA: $4.871 million, plus $244,000 to buy back preferred shares granted to Treasury in lieu of warrants
• Centric Financial, Harrisburg, PA: $6.056 million, plus $182

The shell games being played by our government on behalf of the banks is a disservice to U.S. citizens.

The Leviticus 25 Plan recapture provisions, on the other hand, provide an honest, straightforward mechanism for recapturing the funds extended, while providing direct benefits to American families..

The Primary Dealers Credit Facility (PDCF) was created by the Federal Reserve in the Fall of 2008 to help restore order and maintain liquidity in the credit markets – as the banking crisis began gaining ‘traction.’

Primary Dealer’s ‘mission’ was to bid (take up the slack) at the monthly Treasury auctions whenever demand was light.  It was not unusual for them to ‘take down’  the lion’s share of a given offering when foreign central banks (indirect bidders) and domestic (direct) bidders had cold feet.  This week, for instance, Primary dealers  ‘took down’ 54.66% of the $32 billion auction of 2 year bonds (which, by the way, inched the U.S. national debt up the the $15.413 trillion level).

In the past whenever the Dealers couldn’t ‘move’ (any or all of) the bonds they took down at an auction, they were allowed to ‘flip’ them back to the Federal Reserve, sometimes within days.  They were still allowed to pocket the commissions (millions of dollars worth) for the bonds they could not successfully market (a no-lose deal for themselves – at the expense of U.S. taxpayers).

This monetizing (money printing) mechanism thus expanded the Fed’s balance sheet, and the longer term consequences will not be favorable.

The longer term risk for the U.S. Dollar (vs hard assets) is growing.  And when the Dollar eventually begins its ‘hard slide,’ U.S. citizens are going to get economically hammered.

The Leviticus 25 Plan offers a viable economic recovery plan for America.  And a real chance to avert economic calamity.

“He who will not apply new remedies must expect new evils.” – Sir Francis Bacon

The Leviticus 25 Plan is a dynamic economic initiative providing direct liquidity benefits for American families, while at the same time scaling back the role of government in managing and controlling the affairs of citizens.  It is a comprehensive plan with long-term economic and social benefits for citizens and government.

The inspiration for this plan is based upon Biblical principles set forth in the Book of Leviticus, principles tendering direct economic liberties to the people.

The Leviticus 25 Plan – An Economic Acceleration Plan for America

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January 2025 quote:  “At the foot of every page in the annals of nations may be written, ‘God reigns.’  Events as they pass away proclaim their original; and if you will but listen reverently, you may hear the receding centuries, as they roll into the dim distances of departed time, perpetually chanting “Te Deum Laudamus,” with all the choral voices of the countless congregations of the age.”  – George Bancroft, American historian and statesman (1800-1891)