In Somalia, a Transitional President Is Out

By Nick Wadhams / Nairobi
The U.N. refugee agency released a small news item last week that went largely unnoticed: Kenya's Dadaab refugee camp, destination for tens of thousands of fleeing Somalis since 1991, was full. "All [newly arriving] refugees have to find a place with relatives or friends, we no longer have any land to provide them," a UNHCR field officer said. The three camps that comprise Dadaab were built with 60,000 refugees in mind. They now house 230,000, and tens of thousands more are expected in the coming months.

Somalia, the country they are fleeing, continues to fall further into misery, seemingly unfazed by turmoil and despite the ministrations of the outside world. And on Monday, the President who had ruled the transitional government that was supposed to make things better stepped down.

President Abdullahi Yusuf Ahmed, 74, acknowledged to the country's parliament that Somalia was paralyzed and that there was nothing more he could do. "As I promised when you elected me on Oct. 14, 2004, I would stand down if I failed to fulfill my duty. I have decided to return the responsibility you gave me," Yusuf told them. "I said I will do everything in my power to make government work across the country. That did not happen either." That statement may just be a late contender for 2008 Understatement of the Year. At the very least, it is disingenuous. While it's true that Yusuf's government has never had any power, he must share some of the blame for Somalia's horrible condition.

Yusuf had opposed Prime Minister Prime Minister Nur Hassan Hussein's bid to sign a peace deal with some moderate Islamists in June. The President then tried to fire the Prime Minister, a move that was rejected by parliament. Pressure had been building for months for Yusuf to step down, and the infighting between government officials (whose power extends to one town — Baidoa — and a few square feet of Mogadishu) looked like the last straw. "President Abdullahi Yusuf has marginalized large parts of the population and exacerbated divisions," think tank International Crisis Group wrote in a recent report. "The latest confrontation with parliament and the Prime Minister has underlined that Yusuf hampers any progress on peace, has become a liability for the country's survival and should be encouraged to resign."

In the end, that's just what happened. It would be hard to believe that Yusuf was not forced out or given some financial incentive to leave, or both. The U.S., which had backed Yusuf for years, gave him the usual platitudes but signaled it was ready for a new approach. "We support and respect President Yusuf's decision to resign as President of the transitional federal government and welcome his commitment to continue supporting the Djibouti peace process," State Department spokesman Gordon Duguid said. "We acknowledge President Yusuf's contributions to long-term peace and stability in Somalia."

Duguid did not detail those contributions, and almost anyone would be hard-pressed to do so. Yusuf, a former Somali army officer, later became one of the country's most powerful warlords and had forced the previous Prime Minister, Ali Mohamed Gedi, to resign after a political struggle. He has enormous power because he comes from one of Somalia's biggest clans, the Darod, and carries the implicit threat of a new outbreak of clan fighting wherever he goes.

After stepping down, Yusuf was said to have retreated to his base in the semi-autonomous Puntland region. No one knows his next move. Ethiopian troops, who brought Yusuf into the presidential palace in Mogadishu two years ago, have announced they will withdraw from Somalia in a few days, and so far, there is no obvious candidate who could take Yusuf's place. Nor is there anyone considered powerful enough to united Somalia's ever-divided clans.

"I would be very glad to see peace and a central government in Somalia, but I do not think that the departure of [Yusuf] and Ethiopian troops will bring a peace," the departing President's adviser Abbi Has tells TIME. "Yusuf and Ethiopian troops were not in Somalia when the Somali people began to be held ransom, so all those people who are now saying Yusuf is blocking peace, where were they at that time?" — With reporting by Alexander Dawale / Nairobi

source:TIME

Israel Cegat Kapal Relawan bagi Palestina

by:Ahmad Dani

GAZA - Sebuah kapal relawan internasional yang membawa bantuan berupa obat-obatan ke Jalur Gaza dihalau kapal patroli Israel. Kapal relawan internasional itu kemudian ditahan aparat Israel.

Hal itu seperti dilaporkan radio militer Israel kepada AFP, Selasa (30/12/2008). Bahkan kapal patroli Israel itu sempat memberikan tembakan peringatan dan memerintahkan kepada kapal tersebut untuk berputar.

Namun meski begitu, kapal relawan internasional itu tetap mencoba melintas meski jalur dia sudah diblokadi oleh kapal patroli Israel.

Tak ayal, kedua kapal itu pun sempat bersenggolan yang menyebabkan beberapa bagian dari kapal patroli Israel dan relawan mengalami kerusakan. Namun dilaporkan tak ada korban berjatuhan atas insiden tersebut.

Kapal relawan itu merupakan milik aktivis kemanusiaan internasional yang memerotes pemblokadean jalur Gaza.

Sementara itu Sekjen PBB, Ban Ki-moon mengatakan pada Senin kemarin jika dirinya menolak perang Israel tersebut.

"Saya memberikan peringatan mendalam atas eskalasi dan kekerasan di dan sekitar Gaza. Hal itu tak dapat diterima," kata Ban di Kantor PBB di New York, AS.

Data terakhir yang masuk sekira 360 warga Palestina tewas dan 1600 lainnya mengalami luka-luka akibat serangan udara Israel.

source:okezone

President Yudhoyono urged to issue decree banning Ahmadiyah sect

Jakarta (ANTARA News) - Chairman of the Indonesian Council of Ulemas (MUI) KH Cholil Ridwan asked President Susilo Bambang Yudhoyono to immediately issue a decree banning the Ahmadiyah sect as it still claimed being part of Islam.

In a press conference on a year-end evaluation and the MUI stance at his office here on Tuesday, Cholil Ridwan said the presidential decree would underscore that the Ahmadiyah sect has not relations whatsover with Islam, and has tarnished and deviated from Islamic tenets.

According to him, other countries all over the world including Pakistan where the Ahmadiyah was founded, had regarded the sect as outside Islam.

In fact, the Ahmadiyah in Pakistan was forbidden to use the world "mosque" as their house of prayer. The Pakistani people, wishing to go on pilgrimage to Mecca, were required to produce an Ahmadiyah sect-free certificate, he said.

Cholil Ridwan also told regional administration leaders throughout Indonesia to issue a provincial regulation banning the Ahmadiyah and its propagation. This decision is already in force in South Sumatra.

In the meantime, another MUI Chairman Prof Dr Umar Shihab said his office continued making Ahmadiyah adherents to understand that the sect had deviated from their beliefs, hoping they would return to Islam.

While some of them understood the deviation from their teachings, others still remained with what they believed in. (*)

source:antara

Dua Gempa Cukup Besar Landa Bengkulu

Bengkulu (ANTARA News) - Selama Rabu hingga pukul 03.32 WIB, dua gempa bumi dengan kekuatan cukup besar melanda wilayah Bengkulu.

Informasi dari Badan Meteorologi dan Geofisika (BMG), Rabu, menyebutkan gempa pertama berkekuatan 5,9 pada skala Richter (SR) terjadi di baratdaya Lais, Kabupaten Bengkulu Utara, Bengkulu, pada pukul 02:49:50 WIB.

Episentrum gempa tersebut terletak pada kordinat 4,42 derajat Lintang Selatan (LS) dan 100,96 derajat Bujur Timur (BT) atau berada di 156 Km baratdaya Lais, dengan kedalaman 10 Km.

Kemudian pada pukul 03:32:41 WIB kembali terjadi gempa bumi berkekuatan 5,1 SR di baratdaya Lais, pada titik kordinat 4,33 derajat LS dan 101,06 derajat BT.

Pusat gempa yang tidak berpotensi menimbulkan tsunami itu berada pada 141 Km baratdaya Lais, dengan kedalaman 10 Km. (*)

source:antara

Consumer confidence hits all-time low in Dec.

Dismal job market outweighs declining gas prices to consumers

by:Associated press
Consumer confidence hit an all-time low in December, dropping further in the face of rising layoffs, in yet another sign that consumer spending is unlikely to pull the U.S. out of a yearlong recession any time soon.

Consumers have been nervous about spending for months — putting off big-ticket purchases, forgoing new clothes and choosing store brands at the grocery store — all of which may make this the worst holiday season for retailers in decades.

The Consumer Confidence Index measured by the Conference Board, a private research group, fell to 38 in December from a revised 44.7 in November. That is its lowest point since the group began compiling the index in 1967, and below the previous low of 38.8 in October. Economists surveyed by Thomson Reuters had expected the index to rise incrementally to 45
"Deepening job insecurity and falling asset prices are outweighing any optimism consumers may have derived from falling gas prices," said Dana Saporta, U.S. economist at investment bank Dresdner Kleinwort.

The unemployment rate hit a 15-year high in November, and economists expect additional job losses in the first half of 2009. Those saying in the Conference Board survey that jobs are "hard to get" rose to 42 percent in December from 37.1 percent in November, when the unemployment rate stood at 6.7 percent.

Those claiming business conditions are "bad" increased to 46.0 percent in December from 40.6 percent in November. Consumer spending is likely to keep dropping well into next year, Saporta said, meaning the recession will last at least into the first half of 2009.

The conditions that began the recession persist, especially deflating home prices. A measure of October home prices dropped by the sharpest annual rate on record. The Standard & Poor's/Case-Shiller 20-city housing index fell by 18 percent from October 2007, the largest drop since its inception in 2000. The 10-city index tumbled 19.1 percent, its biggest decline in its 21-year history.

"The numbers are getting worse. And I think they will get quite a bit worse over the next two months because housing demand has plunged since the market went into turmoil," said Patrick Newport, an economist at IHS Global Insight.

Consumers have been whipsawed by home prices, the deteriorating job market and shrinking nest eggs. According to preliminary data from SpendingPulse, which tracks purchases paid for by credit cards, checks or cash, retail sales fell between 5.5 and 8 percent during the holiday season compared with last year. Excluding auto and gas sales, they fell 2 to 4 percent.

"This year is the roughest year we've had," said 35-year-old Anah Meeks, who was at Crabtree Valley Mall in north Raleigh, N.C., before Christmas mainly to get a picture of her 8-month-old son sitting on Santa's lap. "We were wondering how we were going to do it."

source:www.msnbc.msn.com

Indonesia to send medical aid to Gaza

12/29/08 13:40
Jakarta (ANTARA News) - Indonesia, the world's most populous Muslim nation, Monday condemned the massive Israeli air strikes in the Gaza Strip and said it would send medical aid to Palestinian victims.

The offensive, launched Saturday in response to a wave of Palestinian-fired rockets, has killed over 300 people and wounded more than 600 so far.

The Indonesian foreign ministry said the raids were "an overly violent use of force and disproportionate" to the rocket fire by militant groups.

In a statement, it said the rockets were "an act of self-defence" against what it called Israeli "military occupation and colonisation."

The ministry said it hoped Israel and the Palestinians would resume peace talks.

Meanwhile, the head of the health ministry's crisis centre, Rustam Pakaya, was quoted by AFP as saying Jakarta would send medical aid and cash of more than two billion rupiah (184,000 US dollars).

"Besides sending two tonnes of Indonesian-made medical supplies, we'll buy more medical aid in Cairo with the cash," Pakaya added, saying medicines cost less in Egypt and would be easier to transport to the conflict area.

More than 1,000 protesters, mainly students and members of Muslim student organisations, rallied peacefully in central Jakarka, carrying Indonesian and Palestinian flags and banners protesting against the Israeli strikes.

An organiser of the rally said they also planned to march to the Egyptian embassy to urge its government to help Palestinians.

source:www.antara.co.id

Liverpool stay top after Keane double

London, (ANTARA News) - Liverpool beat Bolton Wanderers 3-0 on Friday, Robbie Keane scoring twice to help the Premier League leaders reach the halfway point of the season a point clear of Chelsea.

Chelsea briefly went top when they beat bottom club West Bromwich Albion 2-0 at Stamford Bridge in an early kickoff with goals from Didier Drogba and Frank Lampard.

Carlos Tevez struck in the 83rd minute to give Manchester United a 1-0 victory at Stoke City as the champions moved up to third ahead of Aston Villa`s evening match against Arsenal.

There was an unusual incident at Manchester City as the home side raced into a 4-0 halftime lead against Hull City before eventually winning 5-1.

Felipe Caicedo and Robinho scored twice apiece in a blistering 21-minute spell to make a mockery of Manchester City`s miserable run of two wins in 13 league matches.

Hull manager Phil Brown ordered his team to sit in front of the away supporters at the start of the halftime break and gave the players a public dressing down before allowing them to return to the changing room.

Craig Fagan pulled one back for Hull 10 minutes from time before Stephen Ireland added Manchester City`s fifth.

It was the second successive heavy defeat for promoted Hull, after they lost 4-1 against Sunderland last week.

West Ham United came from behind to win 4-1 at Portsmouth while Fulham drew 0-0 at Tottenham Hotspur.

Everton maintained their good away form with Tim Cahill securing a 1-0 triumph at Middlesbrough while Wigan Athletic beat Newcastle United 2-1 and Sunderland drew 0-0 with Blackburn Rovers.

Liverpool have 42 points followed by Chelsea on 41. Manchester United, who have two games in hand on the top two, are third on 35 with Villa fourth on 34.


Keane double

Liverpool played superbly at Anfield, where they had drawn their last three matches, and were well worth the victory over Bolton as Keane scored twice in five minutes early in the second half to take his tally to three in two matches.

Albert Riera had opened the scoring in the first half and only desperate defending from Bolton denied Liverpool.

Chelsea manager Luiz Felipe Scolari started Drogba and Nicolas Anelka up front against West Brom and the recalled Drogba took only three minutes to make an impact as he firmly headed in a Joe Cole cross.

Chelsea were on top throughout and only goalkeeper Scott Carson, who tipped an Ashley Cole effort on to a post, kept them out.

Joe Cole was also involved in the second goal just before halftime when Frank Lampard neatly dinked the ball over Carson from close range.

Manchester United, back in league action after winning the Club World Cup in Japan last weekend, crushed Stoke 5-0 at Old Trafford six weeks ago but were made to work much harder for a 1-0 win at the Britannia Stadium.

Things swung United`s way after 72 minutes when Andy Wilkinson hacked down Cristiano Ronaldo and was sent off for a second booking.

The visitors took advantage as Gary Neville crossed to substitute Dimitar Berbatov, who flicked on for Tevez to thump the ball home from close range.

Rio Ferdinand was injured in the warmup and United manager Alex Ferguson said the defender could be out for around 10 days.

source:www.antara.co.id

Oil jumps above $40 on Gaza conflict

By GEORGE JAHN

VIENNA, Austria – Tensions generated by a widening conflict between Israel and Palestinian militants sent crude prices up sharply to above $40 a barrel Monday, with gasoline and heating oil also making sizable gains.

Prices also were supported by indications that key OPEC members were acting on commitments to cut back production, in line with a decision earlier this month to take a daily 2.2 million barrels off the market.

Light, sweet crude for February delivery rose $2.51 to $40.22 a barrel in electronic trading on the New York Mercantile Exchange by afternoon in Europe. The contract on Friday rose $2.36 to settle at $37.71.

Israel expanded its air offensive against Gaza's Hamas rulers Sunday and prepared for a possible ground invasion. Arab leaders protested the attacks and Syria broke off indirect peace talks with the Jewish state.

With the two-day death toll nearing 300, Hamas fired rockets deeper than ever into Israel.

"There could be fear that an escalating Middle East conflict could disrupt supplies, though I don't see that happening at this point," said Gerard Rigby, energy analyst with Fuel First Consulting in Sydney. "(Israel-Palestinian conflict) always causes a bit of a blip and is one component that could support prices short-term."

In Vienna, JBC Energy, in its daily newsletter, said prices were also "supported by news that the UAE has decided to reduce crude supplies in January and February in line with the OPEC production cuts." The United Arab Emirates are the fourth-largest producers in the 13-nation cartel.

But any recovery could have its limits.

Oil prices have fallen 73 percent since peaking at $147.27 a barrel on July 11 as a credit crisis in the U.S. sparked a steep drop-off in consumer demand and corporate earnings. And analysts expect more dismal economic news from the fourth quarter over the next few weeks.

"More bad profit reports, jobs reports, housing results will put pressure on prices," Rigby said. "Once Obama comes in, that might start changing sentiment and generate more optimism." Barack Obama is scheduled to be sworn in as U.S. president on Jan. 20.

Trading volumes have been low as many traders take off the week between Christmas and New Year's Day.

In other Nymex trading, gasoline futures gained more than 6 cents to 90 cents a gallon. Heating oil rose by close to 7 cents to fetch $1.31 a gallon, while natural gas for January delivery jumped 23 cents to $6.06 per 1,000 cubic feet.

In London, February Brent crude rose $1.84 to $40.21 a barrel on the ICE Futures exchange

Associated Press writer Alex Kennedy contributed to this article from Singapore.

source:news.yahoo.com

Israeli assault targets symbols of Hamas power

By IBRAHIM BARZAK and MATTI FRIEDMAN

GAZA CITY, Gaza Strip – Israel's air force obliterated symbols of Hamas power on the third day of its Gaza assault Monday, striking next to the Hamas premier's home, devastating a security compound and flattening a building at a university linked to the Islamic group.

Israel's defense minister said his military is fighting a "war to the bitter end" against Hamas.

The three-day death toll rose to at least 315 by Monday morning, with some 1,400 wounded. The U.N. said at least 51 of the dead were civilians, and medics said eight children under the age of 17 were killed in two separate strikes overnight. Israel launched its campaign, the deadliest against Palestinians in decades, on Saturday in retaliation for rocket fire aimed at civilians in southern Israeli towns.

Since then, the number of Israeli troops on the Gaza border has doubled and the Cabinet approved the call-up of 6,500 reserve soldiers.

The strikes have driven Hamas leaders into hiding and appear to have gravely damaged the organization's ability to launch rockets, but barrages continued. Sirens warning of incoming rockets sent Israelis scrambling for cover throughout the day.

source:Associated Press Writers

Barak: Israel in 'all-out war' with Hamas

By:Paula Hancocks and Shira Medding contributed to this report

JERUSALEM (CNN) -- Israel is in "all-out war" with Hamas, the nation's defense minister said Monday as Israeli jets continued to hammer targets in Gaza and the Palestinian death toll reportedly topped 300.

"We have stretched our hand in peace many times to the Palestinian people. We have nothing against the people of Gaza," Defense Minister Ehud Barak said. "But this is an all-out war against Hamas and its branches."

Barak's remarks to parliament came as Israeli warplanes carried out a third day of strikes against the Palestinian militant group that rules Gaza.

The Palestinian death toll from the campaign has topped 300, most of them Hamas militants, Palestinian medical sources said Monday. The attacks also have wounded about 650 people, the sources said.

Columns of smoke rose over Gaza City, while Israeli tanks cruised along the edges of Gaza.
yad Nasr, a spokesman for the International Committee of the Red Cross, said the streets of Gaza were largely empty while airstrikes continued Monday morning.

"Very little number of cars are going out," he said. "People who need to secure some basic food supplies are all to go out, or people looking for a family member who is missing or going to a hospital."

A U.N. spokeswoman in Gaza City described the scene as chaotic and said Palestinians were "running in all directions" and had begun fighting among themselves.

Israel says the goal of the bombardment is to stop an ongoing stream of rockets being fired from Gaza into southern Israel.

More than 40 rockets were fired Monday despite the raids, according to Israeli police spokesman Mickey Rosenfeld. More than 150 rockets have been launched into Israeli territory since the campaign began, Israel Defense Forces said.

One of the strikes killed an Israeli at a construction site in Ashkelon, 6 miles (10 kilometers) north of Gaza, and wounded eight others, a hospital spokeswoman said. The Israeli fatality is the second since the airstrikes began Saturday.

Israel has struck more than 300 Hamas targets since Saturday, its military said.

The raids have fueled demonstrations around the Middle East and Europe, and the U.N. Security Council has called for both sides to immediately end the violence. However, Israeli Prime Minister Ehud Olmert said Sunday that the campaign could last "for some time," and his Cabinet voted to call up 7,000 reservists.

So far, about 2,000 reservists have been activated, according to the government.

Hamas pledges it will defend its land and people from what it calls continued Israeli aggression. Each side blames the other for violating an Egyptian-brokered cease-fire. The truce formally expired December 19, but it had been weakening for months.

An Israeli strike early Monday hit the Jabalya refugee camp, leaving five children dead in a home that was damaged when a nearby mosque was hit, said Dr. Mu'awiya Hassanein. The Israeli military had no immediate comment.

There was no indication of a ground operation inside the territory, but Foreign Minister Tzipi Livni said Sunday that Israel has not ruled out a push into Gaza. Livni defended the airstrikes, saying the raids have been aimed at "only military targets and places in which we know Hamas members are."

"Unfortunately, in this kind of attack, there are some civilian casualties," she said. "But Israel took all the necessary actions to warn the civilians before the attacks to leave the places they know that Hamas stays."

Mustafa Barghouti, a Palestinian parliament member, flatly blamed the violence on the Israeli "occupation" of the Palestinian territories and dismissed Israeli claims that it is targeting only Hamas.

"This is not a war on Hamas; it is a war on the Palestinian people," he said. "The Israeli politicians are using this bloodbath, which is the worst since 1967, for their election campaigns. This is insane."
Both Livni and Barak will be vying in February for the prime minister's post against former prime minister and Likud Party leader Benjamin Netanyahu.

On Sunday, Israel agreed to requests from the Red Cross and others to allow 30 trucks loaded with fuel, food and medical supplies to pass into Gaza.

But Nasr, the Red Cross spokesman, said Israeli sanctions had left Gaza's hospitals "almost incapable of functioning" even before the weekend's attacks, and those facilities are now "bleeding every resource available."

"These supplies will increase by a little bit the quality of the services available to the victims, but it's far from meeting the needs of such medical facilities," Nasr said.

source:CNN's

It's A Wonderful Mortgage Crisis

What the classic holiday movie "It's a Wonderful Life" can teach us about the mortgage industry meltdown.

by: Andrew M. Rosenfield

It's traditional during the holiday season to watch the great Frank Capra movie "It's a Wonderful Life," and this year, the film is particularly relevant—it can help us to better understand our current economic malaise and the mortgage credit problem that is at the center of the crisis.

In one of the most famous scenes, there's a run on the Bailey Building and Loan, a small bank owned by George Bailey, the tortured character played by Jimmy Stewart. As depositors clamor to get their money back, Stewart tells them, "You're thinking of this place all wrong, as if I had the money back in the safe. The money's not here. Your money's in Joe's house, that's right next to yours. And in the Kennedy house and Mrs. Macklin's house and a hundred others. Why, you're lending them the money to build. … Give us 60 days."

In the language of finance, Bailey is explaining that the Bailey Building and Loan made and held "whole loans," mortgages that have not been securitized. Its liabilities are the deposits the bank's depositors have come to withdraw, and its assets are the highly illiquid mortgages that it holds as a result of lending money to the town's residents to build their homes in Bedford Falls.

If the movie were remade today (and let's hope it's not), here's what would happen in Bedford Falls. A different George Bailey—played, say, by Brad Pitt—would have "originated" home loans in Bedford Falls. Pitt would have then sold those loans to Freddie Mac or to Fannie Mae or to another loan aggregator. Each of those loans would then ultimately have been "securitized" into one of many "tranches": cut up into many slices based on the risk of repayment of each chunk of the loan. The various slices from thousands of loans all over the United States would then be pooled, again by potential risk of default, and that pool would issue a mortgage-backed security that was "rated" by one or more of the federally sanctioned ratings agencies: Moody's, Standard & Poor's and Fitch. (In the current crisis, those investments had cryptic names like "GSAMP 2006-S5 A2" and "WAMU 2007-HY6 2B1.") The idea behind the pooling of loan slices is a powerful one—by sorting the payments to those supplying capital into specific risk categories, it is possible to lower the cost of capital to borrowers.

Now, what would the Bailey Building and Loan do with the proceeds it receives from selling the loans that it originated? It would buy securities that would be held as assets on its balance sheet and, depending on the risk and value of those securities, it would continue to originate more loans. So far, this all seems well and good. The securitization has lowered the cost to borrowers and made the assets held by the Bailey Building and Loan appear to be more liquid—instead of lumpy whole loans, its new assets are securities that, at least in theory, can be sold and that are priced in the market.

The problem is that while the Building and Loan would buy securities such as treasury bonds, it would also likely buy small amounts of a lot of mortgage-backed securities, such as the above-mentioned GSAMP 2006-S5 A2 and hundreds of other such securities. These securities aren't heavily traded in markets, but the top category of these offerings typically was treated by bank regulators as extremely safe—likely to return the full value of the investment made in them with interest—because of their very high investment grade ratings. When housing declined in value throughout the United States, many mortgage-backed securities became imperiled, and as a result, many of the nation's banks became insolvent.

So in the presence of a run, in our remake, Brad Pitt might say this: "Why, don't ask for your money back right now when the housing market is in decline. You know that money isn't in the safe; it's invested in GSAMP 2006-S5 A2 and WAMU 2007-HY6 2B1 and the like. I can't give you your money back unless and until those multiyear-duration securities get repaid (if they ever do) or if they somehow revert back toward par value and I can sell them. Since they're trading at cents on the dollar, they have a long way to go. Just give me 60 days, and maybe the Treasury will bail me out."

Jimmy Stewart told his depositors that he knew that their investment in the Bailey Building and Loan was "good," even though its assets were not liquid. This is because he knew the location of each home held as collateral, the occupant-borrower, the prospects for repayment and more. All that Brad Pitt's George Bailey could ever know is that he bought securities rated highly by each and every one of the three government-endorsed rating agencies, and that the investment banks that underwrote them thought those securities were sound investments. Nothing more. He'd have no idea who the borrowers are, where the homes are located, what their condition is or whether they are even occupied, much less the likelihood that a particular borrower could weather the storm.

The contrast is what makes a new viewing of "It's a Wonderful Life" compelling this holiday season—it's a reminder of a simpler time, and simultaneously a stark reflection of what went wrong in the current crisis.

source:Newsweek Web Exclusive