by Tim Williams

Created on: July 13, 2008   Last Updated: September 15, 2008

The monetary system in the world today is based on faith, trust, and honor. When a confidence is broken like the vast amount of sub-prime loans that were available the economic system meltdowns, investors and international banks flee, curency values plummet, inflation runs rampant and economies are destroyed. Monies are no longer backed up by tangible assets. Remember, when the gold standard was replaced? Now curencies all over the world involve trust and faith that national governments will act responsible and actually pay off their debts. The US largest banks, financial institutions, and wall street are facing an acute crises that started back in 1999. The worlds's banks have now put 1/2 trillion dollars into the United States economey in trying to stabalize it. But, irrevoable damage has already been done. American's economic system was once the envy of the world, but now we are precieved with contempt and suspision. The continuing sub-prime mortgage crises is only the tip of the ice-burg in the US economy. Trust in America is quickly disapering. Why? Because we single handely bought the international financial system to almost insolvancy by passing off fraud -ridden sub-prime debt on unsuspecting economies. Any time a possible recssion looms interest rates are lowered. This is what happened in 2000 and again in the beginning of 2007. Consequently mortgage rates fell and more people were able to get loans. This resulted in higher home prices and the whole system fed upon itself. But as home prices rose banks needed to develope more ways to recuite more home buyers. That brought the easy sub-prime mortgage scheme. This whole system was based upon low interest rates. What happened when interest rates rose? Well banks knew the risk of holding all the over valued sub-prime mortgage rates so they looked to foreign financial institutions to sell their mortgags by marketing them as a safe investment. { Here is why trust is so vital in the financial world} American Banks convinced investment rating agencies like Moody's and Standard & Poor's to give the mortgage securities higher valuations than regular sub-prime rates would normally recieve. { This is fraud brought on by the U.S. Banking industry.] The whole world now realized that the United States thurst for greed and easy profit created a world-wide economic disaster. Now the problem is how to restore our credibility and regain the trust of the international community. One of the answers is to create an international regulatory system that monitors and challenges any national regulatory agencies. This can be easily accomplished thru the World Bank and the United Nations. The other step is for thr United States congress to pass National Economic Reform. In that way the rest of the world will be witness to what a united America can do to regain our credibility and allow international regulators access to our financial agencies. This is the best way to avert an impending economic and enviromental disaster that will occcur if we fail to act now.

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