First the antidote du jour from Naked Capitalism

Second (I don’t know where else to write to suggesting this (except to
Christy), a strong wish that the Book Salon at FDL get Danny Schechter on to discuss his latest book "Plunder: Investigating Our Economic Calamity and the Subprime Scandal"

Thirdly -and the main subject of this diary is -finally IMHO- something that REALLY explains the underlying issues that confronts us and the next
President and Congress.
Yes, it’s a long,intense read BUT IF you really want to understand where we are and what the future may hold, it’s a MUST read.

"Over this last neoliberal epoch, the United States and its European allies have forced upon the entire globe a model of the free flow of capital across borders."
EXCERPTS:
"A capitalist economy in order to continue to grow must constantly find
new sources of demand for the growing surplus that it generates. There
comes a time, however, in the historical evolution of the economy when
much of the investment-seeking surplus generated by the enormous and
growing productivity of the system is unable to find sufficient new
profitable investment outlets. The reasons for this are complex having to
do with (1) the maturation of economies, in which the basic industrial
structure no longer needs to be built up from scratch but simply reproduced (and thus can be normally funded out of depreciation
allowances); (2) the absence for long periods of any new technology that
generates epoch-making stimulation and transformation of the economy
such as with the introduction of the automobile (even the widespread use
of computers and the Internet has not had the stimulating effect on the
economy of earlier trans-formative technologies); (3) growing inequality of income and wealth, which limits consumption demand at the bottom of the economy, and tends to reduce investment as unused productive capacity
builds up and as the wealthy speculate more with their funds instead of
investing in the “real” economy—the goods and services producing
sectors; and (4) a process of monopolization (oligopolization), leading to an attenuation of price competition—usually considered to be the main
force accounting for the flexibility and dynamism of the system."

"From this perspective, capitalism in its monopoly-finance capital phase
has become increasingly reliant on the ballooning of the credit-debt
system in order to escape the worst aspects of stagnation. Moreover,
nothing in the financialization process itself offers a way out of this
vicious spiral. Today the bursting of two bubbles within seven years in the center of the capitalist system points to a crisis of financialization, behind which lurks deep stagnation, with no visible way out of the trap at present other than the blowing of further bubbles."

And note this -written in 1998-in referencing Bretton Woods which was the world’s agreement related to international capital flow and see "The Short View: Market Power" below.

In other news(keeping in mind the above referenced article):
The Short View: Market power

How Credit Default Swap Settlements Are Draining Liquidity From
Interbank Market

Seduction, corruption and redemption
Commentary: No easy answers for our broken financial landscape

Pocketful of Multipliers (II): Options for Stimulus Packages Menzie Chinn, Econbrowser, Important for the policy minded.

The Federal Reserve’s balance sheet

IMF firepower could soon run short
“The IMF has enough funds to play an active role in the smaller and
poorer emerging market countries,” says Ken Rogoff, another former IMF
chief economist. “But it doesn’t have the resources to be lender of last
resort for a country of any size like Brazil, Turkey or Argentina. The fund cannot backstop crises in emerging markets the way the Fed can
backstop the crisis in the US.”

Scope of foreclosure crisis daunts government
"Now, more than 30 percent of properties in the foreclosure process are
owned by someone with a different address, indicating the home is likely
owned by an investor, according to foreclosure listing service RealtyTrac
Inc."

Tomgram: Nick Turse, Putting the Pentagon on the Auction Block

DUE TO RECENT BUDGET CUTS, AND THE RISING COST OF
ELECTRICITY, GAS AND OIL,THE LIGHT AT THE END OF THE TUNNEL
HAS BEEN TURNED OFF.

WE APOLOGIZE FOR THE INCONVENIENCE.