Saving Capitalism
Keeping America Strong
Chapter OneMONEYAn unending economic hurricane has been ripping apart the U.S. and world economies since December 2007. In the seventeen months between then and April 2009, the number of unemployed Americans increased by seven million. By April 2009, almost 5.4 million of the nation's 45 million home loans, worth more than $717 billion, were delinquent or in foreclosure.
Although the pace of decline seemed to be slowing by the early summer of 2009, far worse is yet to come in 2010. The Treasury Department's stress test of the nineteen largest banks in early 2009 revealed that they could be forced to write off as much as a fresh $600 billion by the end of 2010, increasing their losses to more than $1 trillion. Most of those mortgage defaults will be by people now at work, who once were thought financially immune to such distress, but now are likely to lose their jobs and then their family homes.
The lender of last resort, the federal government, has tried to blunt this depression with unprecedented levels of money infusions into the U.S. economy. Despite federal commitments of almo ...
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