A little history from ancient Greece. A policy of allowing a few large and powerful individuals, or in our case banking firms, to drive government economic policy, which is what we see going on now, is called an oligarchy, not a democracy, not even a republic. "Oligarchy" means "rule by a few" in Greek. Almost the entire stimulus plan has been cash handouts to a few large financial corporations. Nothing of any substance has been provided to the masses of the people, who elect representatives, who elect our government. Somehow, the Central Planners are heeding the wishes of Goldman Sachs and friends, with ill-regard to moms and pops on Main Street. This was the politics of ancient Greece from 800 to 650 B.C.

Resentment of aristocratic power over the interests of the masses led to dictatorship. The age of the tyrants followed oligarchy in Greece from 650 to 500 BC. The policy and decision making road this Central planner group has chosen is a dangerous path.

Back to the markets. Our take on the Pending Home Sales Agreement plunge is that the third leg of this massive Bear Market, wave (C ) down, is close to starting. It is assured of coming due to the ignoring of the key generators of economic growth in the U.S. The household (consumer) is 70 percent of GDP. Small businesses generate 80 percent of all new jobs. Small banks provide the fuel for consumers and small businesses, small loans and safe returns on conservative investments.

Community Banks were recently assessed a prepayment insurance premium for the next 3 years in order to raise $45 billion into the FDIC insurance fund, which was due December 31st, 2009. Those fees are so onerous, so huge as compared to small community bank earnings, that it basically knocks the crap out of small bank earnings, which are critical for capital accumulation which drives lending ability. This is on top of an already increased premium by 200 percent in 2009. It drew $45 billion of liquidity from the banking system in stealth fashion at a time when banks need more liquidity to lend to consumers. It reduced capital levels in all banks. Another insane, stupid decision by the regulatory agency minions serving this Central Planner group. Why? Because the few large banks who are running our economy have no problem paying this FDIC prepayment fee thanks to all the cash they got from the Central Planners in the bailout plans. It is the small bank that did not need or desire to accept TARP funds that get punished. To quote the president of a community bank that I know well, "Unfortunately the community banks continue to feel the brunt of the financial crisis by bailing out the large banks and having to deal with the numerous new regulations enacted due to the actions of these large institutions. In addition, we are facing the possibility of yet another regulatory body, the Consumer Financial Protection Agency. The House recently narrowly passed the bill to create this agency. Hopefully you heard or read about Obama's "Fat Cat Bankers" interview. This just shows a complete lack of understanding by Obama regarding banking in that he continues to lump all banks together in his comments."