"The action I am taking is no more than a radical measure to hasten the explosion of truth and justice. I have but one passion: to enlighten those who have been kept in the dark, in the name of humanity which has suffered so much and is entitled to happiness. My fiery protest is simply the cry of my very soul. Let them dare, then, to bring me before a court of law and let the enquiry take place in broad daylight!" - Emile Zola, J'accuse! (1898) -

Monday, July 21, 2008

An Open Letter To Michael Rosenwald, Impeachment, Netroots, General Strike

The Impeachment Tool Box; The Most Complete Site For Taking Action

Open Letter to Michael Rosenwald : From My Ohio Friend’s Blog.

Will Human “Herding Behavior” influence the outcome of the November Elections?

Home prices are in a free fall. Unemployment is rising. Lay-offs continue at major companies. Consumer confidence is plummeting to depths not seen since 1980. The President’s ratings are at an all time low. The banking industry is collapsing as the Feds move to shore the industry up. The economy continues in a free fall.

Washington Post Staff Writer, Michael S. Rosenwald, in his Sunday, July 20, 2008; article wrote Why We Buy Into the Herd, Even When It's Not Good for Us.The article is directly related to the current economic impact that the predatory home loans have had upon the banking industry. IndyMac Bank, one of the nation's largest lenders, got caught in this mortgage meltdown that has led to a global credit crisis.

Over the past nine months as borrowers defaulted, IndyMac suffered significant losses and initiated a series of layoffs, including one in the first week of July that shrunk its workforce to 3,400 from 7,200. On July 11, 2008, IndyMac Bank was taken over by Federal regulators and now has the dubious reputation as the largest thrift ever to fail and the second-largest U.S. financial institution ever to collapse, since Continental Illinois National Bank and Trust Co. in 1984.

Rosenwald's article explains the behavior of the bank’s customers as the Fed regulators moved in. “After IndyMac Bancorp failed, customers waited in line for hours to collect their money. The police had to be called in to quell the mob. The scenes brought to mind dire moments from the Great Depression. This time, with satellite TV trucks parked outside the bank's branches, the world watched as our financial system took another body blow.”

As the Federal regulators took over, the Federal Deposit Insurance Corp. web site put up a statement for all IndyMac customers. The web site stated that if the balance of the IndyMac customer is less than $100,000 then their money was safe. Why did they get in line and wait hours if their money is insured and safe.

Why? Rosenwald points out in his article that “many behavioral economists watching people herd in line at the bank -- or flush their portfolios of Fannie Mae and Freddie Mac stock -- sense a much deeper, even primal, response at play. They supposed the only way to describe the behavior is to say: People are acting like frogs.”

When a group of frogs senses they are about to be visited by the dreaded snake, they do not hop in separate directions. They bunch up together. And they fight to get in the middle, taking comfort in being further from being eaten by the bad guy. Sheep do it. Minnows do it. It turns out that humans do, too, particularly in financial crashes.

“Behavioral economists and psychologists see some classic behaviors at play here, leading to herds of people taking measures -- dumping stock, lining up outside banks when they don't need to -- that can actually exacerbate the problems for everyone, causing tornado-like spirals that suck in even wider swaths of people,” Rosenwald's article continues.

That leads to the question I believe needs to be considered in the current election cycle. Will the current War in Iraq, the unstable economy, the high gas price impacting on all budgets, the perceived failures in the Congress and Presidency have the same herding affect on the voters when they go to the polls in November?

Gore Pelosi and The 2008 Netroots Convention

http://cspanjunkie.org http://cspanjunkie.org/?p=190

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