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infusion totaling almost 204 billion euros in a span of three working days.

       September 2007

      Northern Rock, the largest mortgage broker and a large consumer bank in Britain, experienced a run on the bank by depositors. It was the first bank run in over 100 years.

       The Presidental Campaign Heats Up

      As the financial crisis spread around the world in 2007, the U.S. presidential campaign—which was to be the longest and most expensive political campaign in history—picked up steam.

      During the early part of the campaign, even though there were clear signs that the world economy was on the verge of collapsing, the major presidential candidates rarely mentioned the economy as an issue. Rather, the hot campaign topics were the war in Iraq, gay marriage, abortion, and immigration. When the candidates did discuss the economy, they did so dismissively. (This was never more apparent than when presidential candidate John McCain later famously remarked in late 2008, “The fundamentals of our economy are strong,” as the Dow dropped a record 504 points that day.)

      In the face of all the evidence of a mounting major financial crisis, where was our president? Where were our leading presidential candidates and financial leaders? Why were the media darlings of the financial world not warning investors to get out? Why were financial experts still encouraging investors to “invest for the long term”? Why were our political and financial leaders not sounding the warning call about this financial storm? Why didn’t they at least have the wisdom to stand up and say, “It’s the economy, stupid”? To quote a famous song, they were “blinded by the light.” On the surface, everything seemed fine, as evidenced by the next event in our timeline…

       October 9, 2007

      The Dow Jones Industrial Average closed at a historic high of 14,164.

       A Year Later

       September 2008

      President George W. Bush and the U.S. Treasury asked for $700 billion in bailout money to save the economy, over a year after the European Central Bank had already infused 204 billion euros into the economy in August 2007 and almost a year after the Dow hit its all-time high.

      Toxic financial derivatives resulted in the collapse of Bear Stearns and Lehman Brothers and the nationalization of Fannie Mae, Freddie Mac, and one of the world’s largest insurers, AIG.

      Additionally, the U.S. auto industry revealed that it was ailing, and GM, Ford, and Chrysler asked for bailout money. Many states and city governments were also now asking for bailout money.

       September 29, 2008

      On a black Monday, after President Bush asked for bailout money, the Dow plunged 777 points. It was the biggest single-day point-based drop in history, and the Dow closed at 10,365.

       October 1, 2008, through October 10, 2008

      In one of its worst spans ever recorded, the Dow dropped 2,380 points in a little over a week.

       October 13, 2008

      The Dow began to exhibit extreme volatility, going up 936 points in one day, the best point gain in history, closing at 9,387.

       October 15, 2008

      The Dow plunged 733 points, closing at 8,577.

       October 28, 2008

      The Dow gained 889 points, the second best point gain in history, closing at 9,065.

       November 4, 2008

      Barack Obama was elected president of the United States with the campaign slogan, “Change We Can Believe In.” He will take over a government that has by now committed $7.8 trillion in various forms to salvage the economy.

       December 2008

      It was reported that Americans lost 584,000 jobs in November, the biggest posted loss since December 1974. Unemployment was reported at a 15-year high of 6.7 percent, with nearly two million jobs lost in the United States alone in 2008. Additionally, it was reported that China, the world’s fastest growing economy, lost 6.7 million jobs in 2008, an indication that the global economy was in severe distress and on the verge of meltdown.

      Economists finally admitted the U.S. economy had been in a recession since December 2007. One year later, the economists finally figured it out?

      Warren Buffett, who many consider the world’s smartest investor, saw his company, Berkshire Hathaway, lose 33 percent of its stock value in a year. Investors took solace in the fact that the fund outperformed the market—by losing less than the average. That’s comforting.

      Yale and Harvard universities announced their endowment funds lost over 20 percent in a year.

      GM and Chrysler received $17.4 billion in government loans.

      President-elect Obama announced an $800 billion stimulus plan centered on massive infrastructure projects aimed at easing the record U.S. job losses—this was in addition to the $7.8 trillion already committed by the U.S. government.

       December 31, 2008

      The Dow closed at 8,776, down 5,388 points from its record high achieved just over a year earlier. It was the worst yearly performance for the Dow since 1931 and equated to $6.9 trillion in lost value.

       Back to the Future

      Faced with such an overwhelmingly bad economy, President Bush pushed through a landmark bailout plan aimed at saving the economy, saying, “This legislation will safeguard and stabilize America’s financial system and put in place permanent reforms so these problems will never happen again.”

      Many people breathed a sigh of relief, thinking, “Finally, the government is going to save us!” The problem is those are not the words of President George W. Bush. Those are the words of his father, George H. W. Bush. In 1989, the first President Bush asked for $66 billion to save the savings and loan (S&L) industry. The $66 billion did not solve the problem; the S&L industry disappeared from sight. On top of that, the estimated $66 billion rescue package eventually cost taxpayers over $150 billion—more than twice the amount originally estimated. Where did all that money go?

       Like Father, Like Son

      Twenty years later, in September 2008, President George W. Bush asked for $700 billion and made a similar promise: “We’ll make sure, as time goes on, this doesn’t happen again. In the meantime, we got to solve the problem. And that’s why people sent me to Washington, D.C.” Why is it that a father and son said almost the same thing about saving the economy almost 20 years apart? Why was the first President Bush’s promise to fix the system broken?

       All the President’s Men

      The main campaign slogan of President Barack Obama’s campaign was, “Change We Can Believe In.” Given that slogan, we must ask a question: Why did President Obama hire many of the same people who worked in the Clinton administration? That doesn’t seem like change. It seems like status quo.

      During the election, why did Obama consult Robert Rubin, who just recently resigned as head of Citigroup, a company on the verge of its own collapse and that has received some $45 billion in bailout funds, for advice on the economy? Why did he appoint Larry Summers to be director of the White House National Economic Council and Timothy Geithner, former head of the Federal Reserve Bank of New York, to be his secretary of the treasury? All of these men were members of the Clinton economic team and played a part in the repeal of the Glass-Steagall Act of 1933, an act that forbade banks from selling investments. Banks selling investments in the form of derivatives is a big reason why we are in this mess today.

      In overly simple terms, the purpose of the Glass-Steagall Act of 1933, crafted during the last depression, was to separate

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