Larry Kudlow has called it, Jim Cramer has called it, Obama and Geithner have called it, as have the networks of Fox business and CNBC.  They have all called the end of the decline, and therefore the recession.  They point to “green shoots” and “crocuses” (or is it croci?  Who’s checking these things?) of growth and what they call stability in the economy.  They are back to claiming that those who think otherwise are “out of it”, “paranoid”, or just a little nutty.  No doubt about it, these are smart people.  So if that’s true, why don’t I feel better?  More importantly, why is nobody experiencing the benefits of the so-called recovery except for the companies, politicians, and other bad actors responsible for causing the problem in the first place?

Let me explain.

No, there is too much, let me sum up. (bonus points if you post the source of this quote in a comment!)

• For years, banks were loaning money to people who couldn’t afford to pay it back to buy homes.
• People who had no possibility of paying back loans were taking out loans to buy houses they couldn’t afford.
• Because the banks were so free with the money, more people were buying houses than were available.
  • Because there was so much “money” out there people were offering to pay more for a house than that house was worth.
• Politicians were encouraging all of this because they wanted the increased tax revenues that come with increased housing prices, even though they would say that they believed everybody has the right to own a home (that they can’t afford).
  • Rules were passed that mandated that banks had to make loans to people who couldn’t afford to pay them back or face administrative sanctions from the government.

Along about this time, gas got more expensive.  Gas companies were charging more so they would get more profit.  Sovereign nations were decreasing the amount of gas they were producing so they would get more profit from each barrel of oil sold.

During this time, people were making choices between paying their mortgage and filling their Excursions with gas.  Many people chose the latter.

We elected a Congress and President that feel that government is the answer to all problems.  This government spent tax payer money (for generations to come) on bailing out the banks that were going out of business because they made bad loans.  They also bailed out a few companies that had bad business plans.

The unemployment rate in America almost doubled

So the bad guys here are:

1. Lenders who lied on mortgage applications to get houses they couldn’t afford to pay back.
2. Bankers who knowingly allowed the lenders to lie on applications so they could charge interest on mortgage loans.
3. Congressmen and Senators  like Dodd, Schummer, Cox, and Frank, along with other politicians like Geithner, Bernanke, Paulson, and Obama who pushed for laws that continued the ponzi scheme that was the housing market and have bailed out companies who would have otherwise failed and gone out of business.
4. Gas companies.
5. Oil producing countries that withheld production in order to increase profits and make political statements.

Now, let’s look at the so-called recovery.

1. Countrywide loans, the poster company of making bogus loans to people who couldn’t afford to pay them back (with the notable exception of Senator Chris Dodd who got a sweetheart deal so he would work on legislation that benefited Countrywide), was sold to Bank of America for a price well above what the stock was worth.
   1. Bank of America has had 118 million dollars of debt associated with Countrywide guaranteed by the federal government.
   2. Additionally, they have received 45 billion dollars in bail-out money.
2. Wells Fargo Loans received 25 billion in bail-out money.
3. J.P. Morgan/Chase received 29 billion in guarantees for Bear Stearns’ bad loans, in addition to 25 billion in bail out money.
4. Citi Financial has received 350 billion in guarantees and bail out money.
5. AIG received over 100 billion in bail out money.

Add to that, house prices have been arrested in their decline to reality by several initiatives by the government.  And the great crapper capper of it all– one out of every ten work ready people in the country are not able to find work.  In some places, the unemployment rate is even higher!

So, when Kudlow, Cramer, Geithner, Obama, CNBC, FOX Business, or anybody else says that the Depression (that they won’t even call a depression) is largely over, and we are on the upswing, they are really talking about for companies like Bear Stearns, JP Morgan, Goldman Sachs (the training school for the federal government), and others that caused the problem in the first place.  I have to wonder who they are trying to convince– us or them?