THE UNITED SOCIALIST STATES OF AMERICA

 

The US government has taken  control  of  American mortgage giants Fannie Mae and Freddie Mac about five trillion dollars in home loans, over half America’s total mortgage market. [IE MONOPOLY]. in the largest state bailout in history. [IE NATIONALISATION]. The firms have lost billions of dollars because of the US sub-prime crisis [WHICH CAUSED THE]  global credit crunch, and their share prices have fallen by 90% in the past year.[ CAPATALIST RISK: SHARES GO DOWN AS WELL AS UP]. President Bush said the giants posed an "unacceptable risk" to the financial system.[IE THE REPUBLICAN CHANCES OF WINNING IN THE NATIONAL ELECTION IN NOVEMBER]. The companies are being placed in a government "conservatorship" [IE NATIONALISEDSHIP] to help the financial system recover from massive housing losses, officials said. Fannie Mae and Freddie Mac own or guarantee The past year has seen market confidence wane as property prices have plummeted in the worst US housing slump in decades. [LAW OF SUPPLY AND DEMAND]. Fannie Mae and Freddie Mac do not lend directly to homebuyers, but buy mortgages and sell them on. [CAPITALISM ]. This means they have to pay out when homeowners cannot meet their payments. The rise in defaults and repossessions has seen losses of $14bn (£7bn) (84.5BN Yuan). [SOME YOU WIN SOME YOU LOSE]

The latest announcement could cost the US taxpayer $25bn (£12.5bn) [AND FORCE EUROPE INTO RECESSION] – but the US government thinks it is a price worth paying.

[HALF OF THAT WOULD PAY WELFARE FOR THE NOT SO WELL OF POOR OF AMERICA] 

 The markets are likely to react well to this. [NATIONALISATION IS AS GOOD AS A GOVERNMENT BOND]. The implication of allowing these institutions to fail would be terrible both for the banks, who would be left carrying the can for people defaulting on their mortgages.[IE CAPITALISM]

But also it would make mortgages in the US that much more expensive and that could have a terrible effect on the US housing market and therefore on the US economy." [IE LAW FO SUPPLY AND DEMAND] The US Treasury said it was prepared to invest $100bn (£50bn) each to shore up [IE NATIONALISE] Fannie Mae and Freddie Mac.

US Treasury Secretary Henry Paulson said it was because "Fannie Mae and Freddie Mac are so large and so interwoven in our financial system that a failure of either of them would cause great turmoil in our financial markets here at home and around the globe." Both companies will be temporarily run by the Federal Housing Finance Agency, the new [NATIONALISED] agency created by Congress this summer to regulate the mortgage giants. Also, the executives of both institutions have been replaced. US financial analyst Peter Kenny said: "It’s probably a good move for the markets in the short term.[ [STOCKBROKERS WILL MAKE UP THERE RECENT LOSSES]. "This is a stop gap measure that I think was widely seen as something that was going to have to happen, it’s nothing shocking. [ITS NATIONALISATION] It’s not going to address declining house prices.

"How much confidence do people really have at this stage in the Treasury? That rug has been run a bit thin. [THIN ? ITS IN THE PAWNSHOP!].They’re doing what they have to do. It’s not the most creative plan. Their hands are somewhat tied. "This is an enormous announcement but it was kind of assumed that at some point this was going to be tacked together on the part of the Treasury."

 

WELCOME TO THE WORLD OF SOCIALISM

 

On the subject of socialism and the brand of socialism with chinese charecteristics in particular, why is there a debate in Beijing about selling a national treasure to Coca-Cola? What’s next the – the chinese car industry maybe steel? No, its mobile phone companies …! Maybe !!

 

China’s commerce ministry has said it will make an anti-monopoly review of Coca-Cola’s proposed  multi-billion-dollar takeover of Chinese juice producer Huiyuan, state media reported. The US soft drink giant’s application for the bid will be reviewed under the anti-monopoly law once the  ministry receives it, spokesman Yao Shenhong was quoted as saying by state-run China Central  Television over the weekend. Yao said a review was necessary because of the large sum of money involved, according to the television station. Coca-Cola announced last week plans to buy Hong Kong-listed Huiyuan Juice Group for 2.4 billion  dollars,[15 billion Yuan] , the US soft drink maker’s largest acquisition in china.

Analysts have said the takeover, if approved, would be the largest by a foreign firm of a Chinese company, but added the deal had to be reviewed under an anti-monopoly law that took effect last month. The review is required as the combined global turnover of the two firms was more than 10 billion yuan (1.5 billion dollars) in 2007, and as they each made over 400 million yuan in China. The two companies would control 37 percent of China’s juice drink market, according to a Merrill Lynch report. It is unclear how long it will take for the government to approve the purchase, as few details about how the anti-monopoly law should be applied in practice have been clarified. The process could become even more complicated amid rising nationalist opposition to the deal, with some Chinese juice companies reportedly planning to send a letter to the commerce ministry to block the bid.

They argued the acquisition threatened to force them out of business because Coca-Cola would control a large share of the product distribution network after the deal, Monday’s Beijing Morning Post said. Coca-Cola was not immediately available to comment when contacted by AFP on Monday.

Chinese regulators have been reluctant to approve some recent foreign acquisitions. Officials in the past have used delaying tactics to stop deals without formally rejecting them. In July, US private equity firm Carlyle Group abandoned an attempt to buy a stake in Chinese construction machinery maker Xugong Group after waiting three years for regulatory approval.

Why sell an national asset to a foreign country ?. 

 Great Britain has no british car industry,no electrical industry and the majority of national utilities are in the hands of foreigners !! 

 While the manderins chat , they should take into account India’s experience of having coke plants in the country:

Waste product from a Coca-Cola plant in India which the company provides as fertiliser for local farmers contains toxic chemicals, a BBC study has found. Dangerous levels of the known carcinogen cadmium have been found in the sludge produced from the plant in the southern state of Kerala.

The chemicals were traced in an investigation by BBC Radio 4’s Face The Facts programme and prompted scientists to call for the practice to be halted immediately. Face The Facts presenter John Waite visited the plant following complaints from villagers that water supplies were drying up because of the massive quantities of water required by Coca-Cola. Villagers, politicians, environmentalists and scientists have accused the firm of robbing the community of the area’s most precious resource. They say the area’s farming industry has been devastated and jobs, as well as the health of local people, have been put at risk. .

Face The Facts sent sludge samples to the UK for examination at the University of Exeter. Tests revealed the material was useless as a fertiliser and contained a number of toxic metals, including cadmium and lead. The lab’s senior scientist, said: "What is particularly disturbing is that the contamination has spread to the water supply – with levels of lead in a nearby well at levels well above those set by the World Health Organisation."

According to Britain’s leading poisons expert consultant at St Mary’s Hospital in London,said"Immediate steps should be taken by the authorities in India to ban the practice immediately. The levels of toxins found in the samples would, he said, cause serious problems – polluting the land, local water supplies and the food chain. "The results have devastating consequences for those living near the areas where this waste has been dumped and for the thousands who depend on crops produced in these fields. "

Cadmium is a carcinogen and can accumulate in the kidneys, with repeated exposure possibly causing kidney failure. Lead is particularly dangerous to children and the results of exposure can be fatal. Even at low levels it can cause mental retardation and severe anaemia. Professor Henry said: "What most worries me about the levels found is how this might be affecting pregnant women in the area. You would expect to see an increase in miscarriages, still births and premature deliveries."

However, Vice-President of Coca-Cola in India, Sunil Gupta, denied the fertiliser posed any risk. "It’s good for crops," he said. "It’s good for the farmers because most of them are poor and they have been using this for the past three years." Coca-Cola say they will continue to supply the sludge to farmers.

But then they would, would nt they ?

 

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2 thoughts on “THE UNITED SOCIALIST STATES OF AMERICA

  1. USA becomes USSA(USSR)?
     
    the yellow parts are your comments, I guess. funny though! but not funny at all! Chinese government lost hundreds of billions of hard-earned dollars by the Chinese people!
     

     "Great Britain has no british car industry,no electrical industry and the majority of national utilities are in the hands of foreigners !!  "————you seem to be worried about this. The UK government seems not the case though….^_^

  2. speaking of anti-monoply law enforcement practice, from the very beginning, I severely suspect the motive of the drafting and passing of the bill, especially in China….it could very much become another of the government intevention into the economic life of the country and a powerful tool to stir up the so-called nationalism……

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