First a default, then a depression? Some think so

It wouldn’t only cause a depression or another Great Depression, but the Greatest Depression.

Thursday brought a change to that trend, though, as investors heeded a dire message from President Barack Obama, who intimated in a CNBC interview Wednesday that Wall Street was taking the crisis too lightly.

Consequently, stocks sold off sharply and the Treasury Department warned of the dire consequences that might result from a full-blown debt default.

Picking up on that message, Bove said the situation could be more dramatic: A Depression that would cause severe and lasting economic damage.

“The devastation to the United States would be so severe that it would take decades to recover from the Depression caused by a default and the attendant dumping of trillions of dollars of U.S. Treasury securities on the global financial markets,” said Bove, vice president of equity research at Rafferty Capital Markets. Continue reading

China Deal Benefits Obama Donors

Administration-approved takeover by Chinese oil company provides Obama backers windfall

The government watchdog group Judicial Watch is suing the Treasury Department for records pertaining to the department’s decision to grant a Chinese government-backed company access to oil deposits in the Gulf of Mexico, a move that will benefit Obama donors.

The Chinese National Offshore Oil Corporation (CNOOC) reached a “definitive agreement” with Nexen, Inc., a Canadian energy company, announced on July 23, 2012, to buy all of the company’s outstanding public shares. Nexen has holdings in the Gulf of Mexico and Canada, giving the Chinese government access to millions of barrels of Keystone XL and Gulf reserve oil. Continue reading