What is the problem with these US banks and AIG?

it's adjustment trickle down economics. since base has not been able perform , satisfy it's debt load, debts held financial institutions (assets) no longer hold worth. "bad paper" in cases has no value because no 1 buying it. loans held banks not being bought or traded. cash has stopped flowing upward larger corporations.

mighty oak tree, without roots, top dies.
has happened our economy. took few years, policies initiated regean era have caught us.

job numbers used indicator instead of personal income. obvious 3 minimum wage jobs not offset loss of 1 high paying construction or manufacturing job. service jobs not high enough income. on time since 1955, families have needed work more hours survive. why families require 2 wage earners.

today, income loss coupled rising energy cost leading higher real inflation rates situation has arisen enough loans defaulted (mortgage, credit card, medical, etc) lenders not collecting enough keep afloat. add no 1 wants buy these bad loans , have bank failures.

when revenues not provided taxation cover expense of couple of wars, have government borrowing money fund them. money might have gone banks went federal government instead. banks pay 1-2% on savings account funds. government pays 5-7 % on t-bills , bonds. investors go higher rate of return of course.

unfortunately, can see devaluation of our currency way out. interest on $ 9,500,000,000,000 debt payments $ 500,000,000,000 year. since money goes many foreign investors, little bolster economy being spent here.

have no choice pay, if aig allowed fail, cost of failure may have been spread on wider base , not borne entirely families struggling now.

ok maybe subprimemortage crisis have write off debts surely there financial mismangement within these banks. should pay

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