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Posts Tagged ‘economy’

Hat or Mullet? You be the judge

Mullet or Hat?

Protective goggles on, Obama stomped around in a Highlandtown factory yesterday before announcing a $5000 payroll tax credit for businesses that hire new workers. He made his pitch for this plan at Chesapeake Machine, a factory that produces steel containers, machinery for steel plants in Sparrow’s Point.  According to rising Mayor Blake, the factory also makes equipment for solar panel construction and high speed rails.

Highlandtown, a working class neighborhood known for high rates of home ownership, Greek food, and crack cocaine, has historically been home to thriving breweries, butchers and shipping. Many factories have been abandoned; a few struggle on.

In this article, Baltimore Sun interviews the operations manager Joseph Sedlak, who explains that the company has been surviving on Department of Defense contracts. “We’re forced to follow the money,” said Sedlak. Sedlak then revealed to the Sun that Chesapeake was hiring. (more…)

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Finance Frenzy, Unpacked

Jonathan Jarvis's economic breakdown

Jonathan Jarvis's economic breakdown

A year and a half ago, as I drove from New York City to Baltimore with a dog and many boxes, I listened to Cassidy bragging, I got m’ drink and my 2 step, I’m home, I’m home, get the patron, tell ’em that it’s on.

In retrospect, in 2007, the whole country was swaggering, drink in hand. The stock market was swelling to new heights every day. Credit cards were wielded with inpunity–heck, you could always get another and move your debt around.

You could, everyone did it, even banks–until they couldn’t. What happened? What’s up with credit freezes, currency devaluing, the domino of bankruptcies and rumored bankruptcies of GM, Iceland, and Circuit City? Near and dear to idealist urbanite hearts, the City Paper reports that The Patterson Park Community Development Corporation -which bought up blocks of rowhouses, redeveloped homes and spent millions to improve parks and city dwellers’ quality of life–is now broke, thanks largely to another bank gone belly-up.

We know it’s bad, but what, why and how?

Here are the best three explanations I’ve found:

WHAT: FRONTLINE’s special, Inside the Meltdown, “gives a plain-English primer of Wall Street’s meltdown” (Boston Globe). Yes, and the program is riveting, like a car crash narrated by CNBC. It’s about 60 minutes–you can watch online.

WHY: The BBC radio documentary “Rating the Credit Rating Agencies” shows how this sort of organization gave investors full confidence to march on–“to the precipice.” Credit rating agencies like Moody’s had incentives to rate investments highly, like giving a bundle of debt that included sub prime mortgages a triple-A rating. They were pressured to incur more business from investors touting stacks of debt, and they got a cut of the deal–tens of thousands of dollars for each rating, work done in a few hours over a pepperoni pizza. One source concludes, “It was a house of cards.” The podcast is 22 minutes–download before it goes off line at the end of the week.

HOW: The Crisis of Credit Visualized –an animated explanation by California media artist Jonathan Jarvis–takes a couple minutes to get good, but stick with it (the whole thing is 11 minutes). You’ll get the how when Jarvis’s cartoon bankers begin slicing up stacks of mortage debt with swords so the sub-prime mortages–aka toxic assets–are hidden. Later, bad mortages explode into forclosure like bombs around dazed bankers. It also explains collatoralized debt obligations (CDO), credit default swaps, overleveraged banks and how these practices have nearly imploded Wall Street.

As long as we’re all going down with the ship, we should see the iceberg that pierced our vessel. No? You’re getting the patron and turning on Cassidy. Well, ok.

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