Dear Henry Letter to Mr Paulson Sec of Treasury

What's Wrong? Henry sits in his office all day long and doesn't go grocery shopping nor shopping for clothes, nor does Poor Henry really know what is happening in our world.

Checked the price of pasta. Last year a package cost about fifty cents. Today its $1.50. In my book that is 300 times the cost of what it was a year ago. Bread: A bagel cost anywhere from 35 to 50 cents. Today the cost is $1.00. A one hundred per cent increase in the cost. Oil a year ago was in the two something range creeping up to three something and now its $4.55 for regular and a little cheaper in other areas. Cost went up over two hundred per cent. My visit to Argentina more than twelve years ago was an eye opener. They had a tremendous inflation and their money was so cheap it had little value. From the cabbie on the street to the "fifth avenue" like stores in Buenos Aires we were offered far more peso's for the dollar than the official rate. Everyone we met was anxious for the dollar. A return visit several years later I found that it did not change much. We are headed there right now.If Henry wanted to do something then this is what I suggest:

1) Get hold of the economists who are not tied to the Oil industries and have no axe to grind. Get their opinion. I listened to a group of them recently and all agreed that from 35% to as much as 60% of these Oil price increases are due to pure speculation by heavy investors. Who are these investors? The commodities market as we know it is not what it used to be. The market is being manipulated and we all suffer for it. 

What's Right? a) Shut down trade in Oil as a commodity.

b) Regulate its price capping the barrel price from the producers. If we don't do it we will be into a World Wide Depression. If the Republicans can not get their greed in check they too will go down. 

c)Yes, although I hate to say it we need some governmental control on the stock market. Yup we have to stop the greed of companies in watering down their stock so that the small investors get eaten up alive. Example:

Conseco Insurance Company: It went into a Bankruptcy. Our Bankruptcy laws have to change with the times. Those laws sought to protect a select group, creditors. Who are the Creditors? Banks. When this company went belly up the banks got paid and the small shareholders got the short end of the stick. They were wiped out. Guess what happened. There was a "new company" formed with the same name and same guys and are in business. The shareholders (investors) did not get a dime. Yup: Its only a few people who dominate the stock having millions of shares which at 5% ownership of the common stock may give control of a company to those few people. The stock is watered stock in that the amount of shares sold are far in excess of the value of the company. Example. Jones owns a shoe store. Its value based on its assets consisting of the building it owns, stock, good will, furniture and fixtures has a true value of $100,000.00. Jones forms a Public company and issues a million shares at one dollar each. The people out there feel what can you lose? Its only a dollar and so all the stock is sold in a frenzy of buying. The accountants are Andersonian and company who certify the prospectus of the value of the company. Guess what. Jones takes out two hundred and fifty thousand dollars and the company goes belly up. Oh you say it can not happen? Look at Enron and World Com and a list of others. Why does it happen? How can it be controlled? Securities laws have to be changed.

The agency, SEC has to be given real teeth not a set of false uppers and lowers. They have to have a staff who are well paid so as not to be tempted. The staff must be of accountants who are specially trained in forensic accounting to determine the real value of the company and make sure the stock is not so watered as to dilute its value to a point of no return. Yes I have simplified it but my readers are not attorneys and so I have tried to put it on a level that all may have a grasp of what is happening in the stock market. There is too much corruption both in and out of government. Yes we can live with some but not when it gets so out of hand that it harms us all as the recent real estate failure. Blame it on the Banks. Blame it on Wall Street. Yes put the Blame on Mame. What can we do about it? REGULATE BY PASSING LAWS restricting the connections between the banks and wall street. If we do not do it they will bring this country into ruin. Yes Yes Yes I have been a R E P U B L I C A N but I am an American who loves our country. Yes I do not like government control but because of the lack of control of the banking industry and wall street we are in this mess. 

Who ever is elected as President will have no choice but to find a way to control the greed and corruption or we are all lost.