American Republic Online

This is cause for some concern:
FDIC Weighs Tapping Treasury as Funds Run Low

The FDIC has about $50 billion in reserves.  They will need billions just for Indy Mac.

Rest assured that more bank failures are on the way. True, they will mostly be smaller, local banks, but they will add up and put further strain on the FDIC.  Financial institutions have so far written down about $500 billion.  But that’s just bad mortgage debt.  That’s not the only bad debt out there.  In addition, as banks seek to regain their capitalization rates, lending will dry up.  And as pointed out before, the past few years have mostly been a product of mortgage equity withdrawals.  Without that, we would have seen negative GDP for 2 years.  I’m not trying to be doom and gloom, but we are not out of the financial woods yet.  We’ll work through it, but it’s not over yet.

For instance, Washington Mutual’s debt now trades at 20%, which is worse than junk bonds.  Regions, Wachovia, CitiGroup, GMAC, etc etc are all struggling.

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Obama has requested that the Justice Department intervene in an ad directed towards him:

 Any request by any political campaign that federal officials intervene to stop the airing of legitimate political opinion ought to throw up red flags to everybody who cares about protecting the First Amendment.

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The following comes from the Wall Street Journal:

Good news out of Iraq is becoming almost a daily event: In just the past week, we learned that U.S. combat fatalities (five) dropped in July to a low for the war, that key leaders of al Qaeda in Iraq have fled to the Pakistani hinterland, that troop deployments will soon be cut to 12 months from 15, and that Washington and Baghdad are close to concluding a status-of-forces agreement.

Now this: Shiite cleric Moqtada al-Sadr plans to announce Friday that he will disarm his Mahdi Army, which was raining mortars on Baghdad’s Green Zone as recently as April. Coupled with the near-total defeat of al Qaeda in Iraq, this means the U.S. no longer faces any significant organized military foe in the country. It also marks a major setback for Iran, which had used the Mahdi Army as one of its primary vehicles for extending its influence in Iraq…

In many respects, the story of the Mahdi Army’s decline follows the same pattern as al Qaeda’s: Not only was it routed militarily, it also made itself noxious to the very Shiite population it purported to represent and defend. It enforced its heavy-handed religious edicts, coupled with mob-like extortion tactics, wherever it assumed effective control. The overwhelming Shiite rejection of this brand of politics is another piece of good news from Iraq, as it means that Iraqis will not tolerate Iranian-style theocratic rule. It is also an indication that Iraqi politics is developing in a healthy way. (emphasis added)

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Nancy Pelosi’s response to House debate domestic drilling for oil on Friday was to turn off the lights & cameras and send everyone home.  The Republicans want to debate the merits of drilling for some of the over 100,000,000,000 barrels of oil sitting discovered, but untouched under federal lands and coastal waters.  The Democrats lacking any real response to such a suggestion opted for a 5 week vacation to avoid the issue.

The unfortunate “secret” is that the Democrats don’t want gas prices to come down.  Either because A) price shock at the pump will encourage ecological ends or because B) they feel that gas prices will be blamed on Bush (and not on the Congress that was elected with reducing fuel costs as a political promise) which will help Obama in November.

Despite the lack of session, several Republicans are making a stand on the floor of the House again today.  Approximatly 30 Republicans will hold an Energy Debate for “as long as it takes” to get Pelosi to start official bipartisan debate.

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