Commentary by Evans Liberal Politics owner Paul Evans: Yes, it’s scary these days in the downtowns of the major cities. I don’t mean the financial districts, I mean the downtowns where regular people live. There it is very scary indeed. Look, here at Evans Politics, we’re NOT anti-establishement, we are just pro-Democrat, and we even disagree with the Party on some things like abortion, which we are largely against. Bob Swern is my favorite economic commentator, along with Paul Krugman. I guess that makes me progressive as to economic theory. But it’s not just us who feel, and in fact KNOW the economy is in a mess of trouble. Just go downtown someday: to the REAL downtowns….. If we don’t get the Fed in some semblance of order, get it “under control” and get the investment banks properly regulated, the second dip of the double dip recession is coming, and soon.

Washington, you sure better get it together and do the right thing. Democrats, if you don’t get the Fed and the investment banks under control, it ain’t going to be pretty come the 2010 elections. It’s kind of hard to feel good about the party in power when you can’t get a job, you can’t pay your mortgage, and the whole mood of the country is in some kind of gloom. There are five applicants for every job opening up these days. Also, one in five people who are still considered job seekers is unemployed or underemployed. Everybody knows it is the investment banks, and the Fed, and yes, Washington, which is the problem. Better get it together boys. Better listen to the people and do what’s right. Nobody’s fooled, just you people who seem to be the fools to me.

Bob Swern: IMHO, if had to name the two people most spot-on–whose observations and actions concerning the egregious effects that the Quiet Coup has had upon almost everyone but the status quo–about our nation’s historical economic downturn, they’d be Columbia University economics professor and Nobel Prize-winner Joseph Stiglitz and Elizabeth Warren, the Chair of the Congressional Oversight Panel on the Wall Street bailout. Charlie Rose had both of them on his show this week.  You may access both interviews, in their entirety, right HERE. I wanted to focus upon Warren in this diary, and her interview is  directly linked: HERE.

Here’s what Zero Hedge had to say about it: “Elizabeth Warren Discusses The Global ‘Enron’: From Wall Street To Greece And Back.”

The appearance of the Chair of the Congressional Oversight Panel, Elizabeth Warren, on Charlie Rose is a must watch. In addition to an in depth discussion of the the consumer protection agency, which despite all valiant attempts to the contrary, will likely end up under the Fed’s jurisdiction, thereby making the world’s most powerful cabal even more powerful, Warren touches on a variety of other issues, including the sovereign debt situation, commercial real estate, and the one concept at the heart of it all: the lack of impairments by stockholders (and certainly by debtholders) in what was a bankrupt financial industry. The world would not have ended had banks been forced to readjust their balance sheets: the outcome would have been far simpler – all those who had their collective net wealth associated with the balance sheets, and specifically the equity tranche, of firms like Goldman, JPM, Citi, BofA and Wells would have been wiped out. But why do that when not just they, but the entire government were willing to make it seems that a balance sheet reorganization is equivalent to liquidation. Once again, those at the top were more than happy to take advantage of the stupidity of the morts (whose great desire to be distracted by stupidity like primetime TV is well known to the financial-media complex) and in the process make themselves even richer, and more powerful. Now, we expect yet another blogger to come out with yet another book discussing this and every other deadbeaten horse issue out there. And with time amoral hazard itself will slowly become illegal, as everything, and we mean everything, succumbs to the decision making of the Federal Reserve’s Politbureau. In the meantime nothing will change until democracy itself is reignited in this country.

Warren tells us: “We’ve gone straight from Enron to Greece.” She says, ultimately, it’s all about transparency and honesty, of which there is  virtually none, as far as Wall Street’s concerned. (I posted a diary on this just a few days ago, right HERE.)

Warren touches upon everything from Greece to the too-big-to-fails to wiping out shareholders in bankrupt institutions.

Some snippets from her comments:

On off-balance sheet assets yet to be “marked-to-market” by Wall Street..

“Enron taught us a few years back, you remember, in fact that the books are dirty, that there is one set of books put out in front for everyone to see, but there are effectively off the book transactions that nobody can see that reflect the real risks that your enterprise has taken. “

On wiping out shareholders who made money when everything was profitable… (i.e.: privatizing profits and socializing losses)

‘Wiping out shareholders who were the people who invested and who had profited from all of the mistakes that these companies had made for years and years and years before that, that’s not hard.  That’s not rocket science.  That’s just a difference on who gets to sit at the table and who gets to walk away with money.”

Warren continues on to remind us that, due to the just-commencing downturn in commercial real estate (CRE), approximately 3,000 of our nation’s 8,000 banks are at risk of insolvency in the course of the next 36 months. In what’s just the first inning of a rather massive commercial real estate bust, it’s really all about how this will affect these banks that just happen to be the same banks that have been the traditional source for capital for much of our nation’s small business. As Warren reminds us, this is one of the basic reasons why small business lending’s become so tight in the past couple of years; banks are building up reserves for the crash and burn ahead.

(Comment by Evans Liberal Politics owner Paul Evans: not to mention the great Chinese real estate bubble that’s about to “burst” onto the scene – so maybe it’s a bad pun, but we’re going to have to deal with it. Maybe that will be what triggers the second dip — or the depression we all fear.)

And, on the double-dip Great Recession, the meme that even some of the blogosphere’s most optimistic pundits downplayed up until just the past few weeks…

CHARLIE ROSE: Joe Stiglitz, who you know who was here last night, basically says he fears we’ll see a double dip recession, so the economy has to do with inventory and the end of the stimulus and a whole range of issues, unemployment staying where it is. Do you have that kind of, even though you’re a lawyer and not an economist, fear about this economy?

ELIZABETH WARREN: I am afraid.  I’m afraid because of what I see in the real economy. I’m afraid because I don’t see books that are clean, balance sheets that have been cleaned up.  I’m afraid because in October of 2008, Secretary Paulson came to the American people and he said the problem is toxic assets on the books of the banks, and they’re still there.

–SNIP–

I’m afraid because Secretary Paulson said there’s too much concentration in the banking industry, and there’s even more concentration today than there was…

As Warren closes out the interview she says we have not “…begun to rebuild an economy we can believe in. “

It’s true. As the Senate decides whether or not they’ll even bother to create a very weak, virtual caricature of the Consumer Finance Protection Agency–one without any teeth in it at all; one which Barney Frank just referred to as “a joke”; and one that might very well have been run by none other than Warren, herself–“the truthteller,” Elizabeth Warren, admits she’s afraid of what the future holds for the economic well-being of almost all Americans.

See U.S. Enriches Companies Defying Its Policy on Iran, The New York Times, March 6, 2010, by Joe Becker and Ron Nixon. (And we’re talking $107 billion here.)

Read The U.S. Senate and Bunning’s Universe, Evans Liberal Politics, March 5, 2010 by Paul Krugman.

Find out All about Nobel Prize-winning economist Paul Krugman, here.

Read The Up-or-Down Vote on Obama’s Presidency, The New York Times Op-Ed lead, March 6, 2010, by Frank Rich.