And the U.S. economy, this is absolutely incredible. I want to share with you, first of all, let’s just broadly talk about what’s happening with the economy in the United States. Elizabeth Warren is the person who is in charge of overseeing the TARP program. And you know, given that job by Congress when they put the thing together. And here she is with her report. This is from about three days ago, three or four days ago [it was uploaded 14 July 2009]. Her report to the nation. And you can, this is actually, it’s on YouTube actually, you know. Increasingly the Government is delivering things to us in that forum. Elizabeth Warren, telling us about what she’s found:

Once we had our numbers and our models we compared them with what Treasury has received for the warrants it has already sold.

Ok now let me just explain. Warrants are the option to buy back the stock on the bank at some point in the future, among other things. And so one of the ways the Treasury gave money to banks was by buying warrants. By buying basically options to buy stock in the bank. And so when we buy those warrants back, or when we, I’m sorry. When the warrants get returned to us, essentially, do we get them back at one hundred percent? Now we had been told, hey we’re going to give money to the bank, we’re going to get it all back. And this is the warrants are the mechanism by which it was done. So, once again, with that context, listen to Elizabeth Warren:

Once we had our numbers and our models we compared them with what Treasury has received for the warrants it has already sold. What we found has us worried. In general, Treasury sold its warrants back to the banks at just 66% of market value. That is, Treasury got about $66 for each $100 that we estimate that those warrants were worth. So far that has created a gap of about $10 million. This raises serious questions about whether Treasury should consider other methods such as auctioning off the warrants or holding them long term in order to get the highest possible price for the taxpayers.

So first of all, the banks are wanting to buy these warrants back, and the reason, of course, that the banks want to buy them back, is so that they can get out from underneath the restrictions of the government and start paying their executives huge salaries. But they’ve been buying them back at only sixty six cents on the dollar, and the Treasury Department has been going along with it. Elizabeth Warren says, 'you know, this isn’t quite kosher':

Back in October, before this panel was even created, the Treasury Department under Secretary Paulson put nearly $300 billion into the banks. He said it was a par transaction: for every $100 of taxpayer money, the banks gave us back $100 worth of preferred stock and warrants. We analyzed these transactions and we discovered that these securities were not worth $100. On average, Treasury got only $66 back for every $100 invested.

By the time we made our report, the money was gone."

By the time we made our report, the money was gone. In other words, the banks screwed us. And now they’re reporting record profits. What’s wrong with this picture? Okay, step one.

Step two: I have here a list, it’s actually 269 pages, of all the Chinese tariffs. In other words, what it costs to import something into China. For example, line item number 03011000-Live fish, 32.5%. Fried fish, 12%. Other, 12%, Other, 19.8%, that includes flatfish, halibut, piansoto [ph], etc. So they’re protecting their fish market, okay. Albacore tuna, 12%. 16% import tariff on dogfish, yellowfish, blahdeblahdeblah. Fish: sole, 16%. Very interesting. Herrings, 24%. You know, this is the Chinese protecting their fish market. So then we look at other things like, for example, plastics. Plastics for, where did it go here, I have lost some of my pages. Somehow they got screwed up. But anyway, what I found is that nylons, plastics, things like that, they were running 16, 18% tariffs. Some of these tariffs are sized 25%, that they’re protecting their domestic clothing industry. And yet we’re not protecting ours. And so, guess what? All of our manufacturing is going over to China.

The reason I bring this up is because the front page story in today’s Financial Times is how President Obama met with the Chinese and said essentially, 'some people worry about communist China rising as a power in the world. I take a different view'. I’m sorry to disagree with the President of the United states, but I take a different view. I think that we should be concerned about the rise of Communist China, economically. In large part because it’s happening at the expense of the United States.

Transcribed by Suzanne Roberts, Portland Psychology Clinic.