'USA transforming into USSRA'
An economic analyst says by buying out investment giants, the USA had transformed into the USSRA (the United Socialist State Republic of America).
(17 Sep 2008 - Press TV) "This transformation of the USA into a country where there is socialism for the rich, the well connected and Wall Street (i.e. where profits are privatized and losses are socialized) continues today with the nationalization of AIG,” Nouriel Roubini said.
"This latest action on AIG follows a variety of many other policy actions that imply a massive - and often flawed - government intervention in the financial markets and the economy," Roubini added.
"The bailout of the Bear Stearns creditors; the bailout of Fannie and Freddie; the use of the Fed balance sheet (hundreds of billions of safe US Treasuries swapped for junk toxic illiquid private securities); the use of the other government sponsored enterprises GSEs (the Federal Home Loan Bank system) to provide hundreds of billions of dollars of "liquidity" to distressed, illiquid and insolvent mortgage lenders; the use of the Securities and Exchange Commission SEC to manipulate the stock market (restrictions on short sales); the use of the US Treasury to manipulate the mortgage market (Treasury will now for the first time outright buy mortgage-backed security agency to manipulate and prop up this market);…." Roubini elaborated.
Roubini, nicknamed "Dr. Doom" because of his grim economic outlook, said the AIG rescue means that "the US government is now the largest insurance company in the world. So the transformation of the USA into the USSRA goes a step further."