Hello.

Amid Obama’s constant apologies, fears of high electrical costs in the fall, Iran’s constant sabre rattling and Dow panics something happened today that just might make our recession into a depression, worldwide.

IndyMac went under.  Indymac, once upon a time was subsidiary of Countrywide. The two banks split in the nineties and became competitors. Indymac held billions in assets that now have to be covered by the FDIC, an estimated 10% of the current FDIC reserve. That’s a whole lot of cash. Which they are going to have to recoup by upping their insurance premiums to banks, which the banks will recover by, you guessed it, upping their fees to customers.

As always these major financial blow-ups trickle down ever so gently to the consumer. Most of the time we don’t even notice. We shrug our shoulders and meander off to deal with other things. It’s a very flip attitude we have toward these major crisis. We somehow think that the government will fix everything and it will be ok. If the last eight years have taught us anything it’s that the government couldn’t care less about the average U.S. citizen. If you are not a terrorist or a major corporate campaign contributor you are not worth the effort.

So one had to ask, as more banks fail under the weight of poor lending practices and hedge fund mis-management who is going to bail out the average consumer? The answer is, no one. The President has already stated that he will veto the bill offering block grants to help those in foreclosure. As the dollar continues to get weaker prices will soar for things we nominally take for granted, like food. It’s not just the so called underdeveloped countries that are struggling. It’s happening here in the U.S as well. Food Pantries are operating at an all time high. Many of them are running out before all the needs are met. Social Services across the country are reporting record applications for housing and food. Even though it might make for great jokes around the water-cooler, something like six hundred Starbucks closing their doors is a very bad indicator of the times.

It’s a very slow slide into what could be a long depression. And the recipients of the brunt will be average Americans.

IndyMac was one of the largest housing lenders beaten out only by FannieMae and FreddieMac. If by some cruel twist of government interference either one of those lending institutions goes under the United States would be facing total financial collapse.

The Government and the media are attempting to downplay this latest development in order to avoid a rush of investors yanking their money out of play.  A move that could have disastrous effects on an already shaky market.

In coming days I guess we will just have to watch and see how this plays out but, I am not hopeful.

Dogwoman