Stages Of Collapse (Fat lady is warming up)

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Stages of Collapse
Stage 1: Financial collapse. Faith in "business as usual" is lost. The future is no longer assumed resemble the past in any way that allows risk to be assessed and financial assets to be guaranteed. Financial institutions become insolvent; savings are wiped out, and access to capital is lost. Stage 2: Commercial collapse. Faith that "the market shall provide" is lost. Money is devalued and/or becomes scarce, commodities are hoarded, import and retail chains break down, and widespread shortages of survival necessities become the norm. Stage 3: Political collapse. Faith that "the government will take care of you" is lost. As official attempts to mitigate widespread loss of access to commercial sources of survival necessities fail to make a difference, the political establishment loses legitimacy and relevance. Stage 4: Social collapse. Faith that "your people will take care of you" is lost, as local social institutions, be they charities or other groups that rush in to fill the power vacuum run out of resources or fail through internal conflict. Stage 5: Cultural collapse. Faith in the goodness of humanity is lost. People lose their capacity for "kindness, generosity, consideration, affection, honesty, hospitality, compassion, charity" (Turnbull, The Mountain People). Families disband and compete as individuals for scarce resources. The new motto becomes "May you die today so that I die tomorrow" (Solzhenitsyn, The Gulag Archipelago). There may even be some cannibalism.

Dangerous Junk Mail? Obsession The Movie

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I got this free DVD OBSESSION in the mail today from The Clarion Fund. While I am tempted to play it in my computer, I am somewhat fearful that it could contain a harmful virus. Not only that, but since Homeland Security seems to be looking into every ones business (Patriot Act), I would fear that the film might contain something that could be held against me in a court of law! I googled Clarion Fund and I didn't like the sound of it. Apparently 28 million copies of this film were sent out to the swing states (Ohio is just one). I am skeptical of propaganda this close to the elections. Perhaps learning about the film will be more revealing than the film itself!

Ohio weighs in on the bailout.

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It is nice to know that a Representative from Ohio is speaking for those of us who are not supporting a Wall Street bailout. Correct me if I am wrong but Marcy Kaptur seems to be a little sarcastic. Ms. Kaptur is a Democrat from Toledo Ohio. I wish I could vote for her.

An American Footprint

Last nights debate was so focused on the economy and foreign policy, but never really touched on the heart of the problem (aside from the irresponsibility of Wall Street). We do not export enough products and services here at home to fund this ridiculous war in Iraq. We are borrowing from China to pay for this expensive war. We are weak on producing anything to export, dependent on foreign nations for most of our consumption, and going into further debt to the very countries that we need to distance ourselves from. Perhaps the next debate will address this problem and offer some solutions. Hopefully The American People will soon begin to realize that we need to produce more products for home use as well as export. We need to spend our dollars here and strengthen our own economy.
I am so pleased to find An American Footprint. This is a new web site in its first stages, so you can submit your favorite companies that produce American made products and services. You can participate in the Forum and add your ideas and experience. This is an idea whose time has come. You can help save the US economy buy seeking out and promoting products and services that are made here in America. Check out American Footprint and add it to your bookmarks. Stop buying things made in 3rd world countries. If we don't invest in our own economy we are in danger of becoming the next 3rd World Country.

McCain and Obama on Gun Control

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I wish Obama and McCain would have the debate. They do have some similar beliefs about gun control.

There is no place like home

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I could live well in one of these. Much safer than a mobile home! Where do I sign up?

Please Bail Me Out Too

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I found this cool new website called buy my shit pile. Since the Government is bailing out so many of the elite, perhaps we can get them to buy our shit too. Feel free to add something to this site.

Coming Soon!

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You better get ready, because this is just a few miles away from here. They probably have started making a similar slide show of Cleveland. Brace yourselves.

Treason

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They are coming for your bank account! Better get ready.

Alan Greenspan on the bailouts

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From the NY Times

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I couldn't have said it any better!

Act Like Nothing's Wrong

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After Ike

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We are steadily cleaning up our back yard. I was hoping for some firewood and it looks like Ike has granted me my wish.

Power Out at My Place

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The Power is off at my house because of Hurricane IKE. I won't be blogging everyday as it is dependent on me obtaining computer time at the library. I look forward to resuming blogging as soon as I get back on line.

Whats in your wallet?

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I am sure everyone has seen the $20 bill folded to reveal the WTC twin towers burning, but check out what else is hidden in these bills

White Queen For Sale

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This White Queen was designed by the sculptor Peter Ganine (1900-1974). She is marked 1947 which would make her from the very first Chess Set he designed. She is part of an estate that I am helping to liquidate for a friend. She is for sale right now on eBay. You can click on my username below and go to my auctions.

skymetalsmith ( 326)

What we can expect in the future?

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So much for The Second Amendment...just when you need it too!

What scares me...

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Anniversary 9/11

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Hot Times Art Car Winner

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One of my favorite Hot Times Festival features is the Art Cars. There were many very wonderful Art Cars this year. Barbara Nicolazzo took 2 the winning trophys back to Florida with her. I was fortunate to have sat in Sunday morning drum circle with Barbara who borrowed my tambourine for awhile. She can drive, and she can jam. Thanks Barbara for coming up to our little festival! Maybe next year she will travel to Comfest. She would fit right in. Click on her name and check out all the cars and things she paints.

Take a Load Off Fannie

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Columbus Womens Drum Chorus at Hot Times

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The Columbus Womens Drum Chorus at Hot Times last night. What a jam!

Hot Times in Columbus

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Come on down to the
Hot Times Festival here in Columbus Friday, Saturday, and Sunday. I won't be blogging on Sunday I will be playing drums in The Columbus Womens Drum Chorus. Hope to see you there.

What about that wedding ring John?

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How you know the banks are unsound

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When....

1. Paulson appears on Face The Nation and says "Our banking system is a safe and a sound one." If the banking system was safe and sound, everyone would know it (or at least think it). There would be no need to say it.

2. Paulson says the list of troubled banks "is a very manageable situation". The reality is there are 90 banks on the list of problem banks. Indymac was not one of them until a month before it collapsed. How many other banks will magically appear on the list a month before they collapse?

3. In a Northern Rock moment, depositors at Indymac pull out their cash. Police had to be called in to ensure order.

4. Washington Mutual (WM), another troubled bank, refused to honor Indymac cashier's checks. The irony is it makes no sense for customers to pull insured deposits out of Indymac after it went into receivership. The second irony is the last place one would want to put those funds would be Washington Mutual. Eventually Washington Mutual decided it would take those checks but with an 8 week hold. Will Washington Mutual even be around 8 weeks from now?

5. Paulson asked for "Congressional authority to buy unlimited stakes in and lend to Fannie Mae (FNM) and Freddie Mac (FRE)" just days after he said "Financial Institutions Must Be Allowed To Fail". Obviously Paulson is reporting from the 5th dimension. In some alternate universe, his statements just might make sense.

6. Former Fed Governor William Poole says "Fannie Mae, Freddie Losses Makes Them Insolvent".

7. Paulson says Fannie Mae and Freddie Mac are "essential" because they represent the only "functioning" part of the home loan market. The firms own or guarantee about half of the $12 trillion in U.S. mortgages. Is it possible to have a sound banking system when the only "functioning" part of the mortgage market is insolvent?

8. Bernanke testified before Congress on monetary policy but did not comment on either money supply or interest rates. The word "money" did not appear at all in his testimony. The only time "interest rate" appeared in his testimony was in relation to consumer credit card rates. How can you have any reasonable economic policy when the Fed chairman is scared half to death to discuss interest rates and money supply?

9. The SEC issued a protective order to protect those most responsible for naked short selling. As long as the investment banks and brokers were making money engaging in naked shorting of stocks, there was no problem. However, when the bears began using the tactic against the big financials, it became time to selectively enforce the existing regulation.

10. The Fed takes emergency actions twice during options expirations week in regards to the discount window and rate cuts.

11. The SEC takes emergency action during options expirations week regarding short sales.

12. The Fed has implemented an alphabet soup of pawn shop lending facilities whereby the Fed accepts garbage as collateral in exchange for treasuries. Those new Fed lending facilities are called the Term Auction Facility (TAF), the Term Security Lending Facility (TSLF), and the Primary Dealer Credit Facility (PDCF).

13. Citigroup (C), Lehman (LEH), Morgan Stanley(MS), Goldman Sachs (GS) and Merrill Lynch (MER) all have a huge percentage of level 3 assets. Level 3 assets are commonly known as "marked to fantasy" assets. In other words, the value of those assets is significantly if not ridiculously overvalued in comparison to what those assets would fetch on the open market. It is debatable if any of the above firms survive in their present form. Some may not survive in any form.

14. Bernanke openly solicits private equity firms to invest in banks. Is this even close to a remotely normal action for Fed chairman to take?

15. Bear Stearns was taken over by JPMorgan (JPM) days after insuring investors it had plenty of capital. Fears are high that Lehman will suffer the same fate. Worse yet, the Fed had to guarantee the shotgun marriage between Bear Stearns and JP Morgan by providing as much as $30 billion in capital. JPMorgan is responsible for only the first 1/2 billion. Taxpayers are on the hook for all the rest. Was this a legal action for the Fed to take? Does the Fed care?

16. Citigroup needed a cash injection from Abu Dhabi and a second one elsewhere. Then after announcing it would not need more capital is raising still more. The latest news is Citigroup will sell $500 billion in assets. To who? At what price?

17. Merrill Lynch raised $6.6 billion in capital from Kuwait Mizuho, announced it did not need to raise more capital, then raised more capital a few week later.

18. Morgan Stanley sold a 9.9% equity stake to China International Corp. CEO John Mack compensated by not taking his bonus. How generous. Morgan Stanley fell from $72 to $37. Did CEO John Mack deserve a paycheck at all?

19. Bank of America (BAC) agreed to take over Countywide Financial (CFC) and twice announced Countrywide will add profits to B of A. Inquiring minds were asking "How the hell can Countrywide add to Bank of America earnings?" Here's how. Bank of America just announced it will not guarantee $38.1 billion in Countrywide debt. Questions over "Fraudulent Conveyance" are now surfacing.

20. Washington Mutual agreed to a death spiral cash infusion of $7 billion accepting an offer at $8.75 when the stock was over $13 at the time. Washington Mutual has since fallen in waterfall fashion from $40 and is now trading near $5.00 after a huge rally.

21. Shares of Ambac (ABK) fell from $90 to $2.50. Shares of MBIA (MBI) fell from $70 to $5. Sadly, the top three rating agencies kept their rating on the pair at AAA nearly all the way down. No one can believe anything the government sponsored rating agencies say.

22. In a panic set of moves, the Fed slashed interest rates from 5.25% to 2%. This was the fastest, steepest drop on record. Ironically, the Fed chairman spoke of inflation concerns the entire drop down. Bernanke clearly cannot tell the truth. He does not have to. Actions speak louder than words.

23. FDIC Chairman Sheila Bair said the FDIC is looking for ways to shore up its depleted deposit fund, including charging higher premiums on riskier brokered deposits.

24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.

25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.

What cannot be paid back will be defaulted on. If you did not know it before, you do now. The entire US banking system is insolvent.

http://globaleconomicanalysis.blogspot.com/2008/07/you-know-banking-system-is-unsound-when.html

Scary Sarah Palin for VP

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John McCains unbelievable choice for a running mate reminds me of trailer trash in this photo. Here Sarah poses with an air rifle. I am hoping that disgruntled Clinton supporters do not fall for this attempt to secure female votes. Obama took all kinds of grief for not always wearing the American Flag. Here Sarah wears a semblance of the flag. I understand there are nude pictures floating around out there somewhere as well. Her patriotism has been called into question. Will foreigners take this woman seriously. McCain obviously wanted to shake things up. Here is some facts about Sarah from a fellow Alaskin.

ABOUT SARAH PALIN by Anne Kilkenny

I am a resident of Wasilla, Alaska. I have known Sarah since 1992.
Everyone here knows Sarah, so it is nothing special to say we are on a
first-name basis. Our children have attended the same schools. Her
father was my child's favorite substitute teacher. I also am on a
first name basis with her parents and mother-in-law. I attended more
City Council meetings during her administration than about 99% of the
residents of the city.

She is enormously popular; in every way she’s like the most popular
girl in middle school. Even men who think she is a poor choice and
won't vote for her can't quit smiling when talking about her because
she is a "babe".

It is astonishing and almost scary how well she can keep a secret. She
kept her most recent pregnancy a secret from her children and parents
for seven months.

She is "pro-life". She recently gave birth to a Down's syndrome baby.
There is no cover-up involved, here; Trig is her baby.

She is energetic and hardworking. She regularly worked out at the gym.

She is savvy. She doesn't take positions; she just "puts things out
there" and if they prove to be popular, then she takes credit.

Her husband works a union job on the North Slope for BP and is a
champion snowmobile racer. Todd Palin’s kind of job is highly
sought-after because of the schedule and high pay. He arranges his
work schedule so he can fish for salmon in Bristol Bay for a month or
so in summer, but by no stretch of the imagination is fishing their
major source of income. Nor has her life-style ever been anything
like that of native Alaskans.

Sarah and her whole family are avid hunters.

She's smart.

Her experience is as mayor of a city with a population of about 5,000
(at the time), and less than 2 years as governor of a state with about
670,000 residents.

During her mayoral administration most of the actual work of running
this small city was turned over to an administrator. She had been
pushed to hire this administrator by party power-brokers after she had
gotten herself into some trouble over precipitous firings which had
given rise to a recall campaign.

Sarah campaigned in Wasilla as a “fiscal conservative”. During her 6
years as Mayor, she increased general government expenditures by over
33%. During those same 6 years the amount of taxes collected by the
City increased by 38%. This was during a period of low inflation
(1996-2002). She reduced progressive property taxes and increased a
regressive sales tax which taxed even food. The tax cuts that she
promoted benefited large corporate property owners way more than they
benefited residents.

The huge increases in tax revenues during her mayoral administration
weren’t enough to fund everything on her wish list though, borrowed
money was needed, too. She inherited a city with zero debt, but left it
with indebtedness of over $22 million. What did Mayor Palin encourage
the voters to borrow money for? Was it the infrastructure that she said
she supported? The sewage treatment plant that the city lacked? or a
new library? No. $1m for a park. $15m-plus for construction of a
multi-use sports complex which she rushed through to build on a piece
of property that the City didn’t even have clear title to, that was
still in litigation 7 yrs later--to the delight of the lawyers
involved! The sports complex itself is a nice addition to the
community but a huge money pit, not the profit-generator she claimed it
would be. She also supported bonds for $5.5m for road projects that
could have been done in 5-7 yrs without any borrowing.

While Mayor, City Hall was extensively remodeled and her office
redecorated more than once.

These are small numbers, but Wasilla is a very small city.

As an oil producer, the high price of oil has created a budget surplus
in Alaska. Rather than invest this surplus in technology that will
make us energy independent and increase efficiency, as Governor she
proposed distribution of this surplus to every individual in the state.

In this time of record state revenues and budget surpluses, she
recommended that the state borrow/bond for road projects, even while
she proposed distribution of surplus state revenues: spend today's
surplus, borrow for needs.

She’s not very tolerant of divergent opinions or open to outside ideas
or compromise. As Mayor, she fought ideas that weren’t generated by
her or her staff. Ideas weren’t evaluated on their merits, but on the
basis of who proposed them.

While Sarah was Mayor of Wasilla she tried to fire our highly respected
City Librarian because the Librarian refused to consider removing from
the library some books that Sarah wanted removed. City residents
rallied to the defense of the City Librarian and against Palin's
attempt at out-and-out censorship, so Palin backed down and withdrew
her termination letter. People who fought her attempt to oust the
Librarian are on her enemies list to this day.

Sarah complained about the “old boy’s club” when she first ran for
Mayor, so what did she bring Wasilla? A new set of "old boys". Palin
fired most of the experienced staff she inherited. At the City and as
Governor she hired or elevated new, inexperienced, obscure people,
creating a staff totally dependent on her for their jobs and eternally
grateful and fiercely loyal--loyal to the point of abusing their power
to further her personal agenda, as she has acknowledged happened in the
case of pressuring the State’s top cop (see below).

As Mayor, Sarah fired Wasilla’s Police Chief because he “intimidated”
her, she told the press. As Governor, her recent firing of Alaska's top
cop has the ring of familiarity about it. He served at her pleasure
and she had every legal right to fire him, but it's pretty clear that
an important factor in her decision to fire him was because he wouldn't
fire her sister's ex-husband, a State Trooper. Under investigation
for abuse of power, she has had to admit that more than 2 dozen
contacts were made between her staff and family to the person that she
later fired, pressuring him to fire her ex-brother-in-law. She tried to
replace the man she fired with a man who she knew had been reprimanded
for sexual harassment; when this caused a public furor, she withdrew
her support.

She has bitten the hand of every person who extended theirs to her in
help. The City Council person who personally escorted her around town
introducing her to voters when she first ran for Wasilla City Council
became one of her first targets when she was later elected Mayor. She
abruptly fired her loyal City Administrator; even people who didn’t
like the guy were stunned by this ruthlessness.

Fear of retribution has kept all of these people from saying anything
publicly about her.

When then-Governor Murkowski was handing out political plums, Sarah got
the best, Chair of the Alaska Oil and Gas Conservation Commission: one
of the few jobs not in Juneau and one of the best paid. She had no
background in oil & gas issues. Within months of scoring this great
job which paid $122,400/yr, she was complaining in the press about the
high salary. I was told that she hated that job: the commute, the
structured hours, the work. Sarah became aware that a member of this
Commission (who was also the State Chair of the Republican Party)
engaged in unethical behavior on the job. In a gutsy move which some
undoubtedly cautioned her could be political suicide, Sarah solved all
her problems in one fell swoop: got out of the job she hated and
garnered gobs of media attention as the patron saint of ethics and as a
gutsy fighter against the “old boys’ club” when she dramatically quit,
exposing this man’s ethics violations (for which he was fined).

As Mayor, she had her hand stuck out as far as anyone for pork from
Senator Ted Stevens. Lately, she has castigated his pork-barrel
politics and publicly humiliated him. She only opposed the “bridge to
nowhere” after it became clear that it would be unwise not to.

As Governor, she gave the Legislature no direction and budget
guidelines, then made a big grandstand display of line-item vetoing
projects, calling them pork. Public outcry and further legislative
action restored most of these projects--which had been vetoed simply
because she was not aware of their importance--but with the unobservant
she had gained a reputation as “anti-pork”.

She is solidly Republican: no political maverick. The State party
leaders hate her because she has bit them in the back and humiliated
them. Other members of the party object to her self-description as a
fiscal conservative.

Around Wasilla there are people who went to high school with Sarah.
They call her “Sarah Barracuda” because of her unbridled ambition and
predatory ruthlessness. Before she became so powerful, very ugly
stories circulated around town about shenanigans she pulled to be made
point guard on the high school basketball team. When Sarah's
mother-in-law, a highly respected member of the community and
experienced manager, ran for Mayor, Sarah refused to endorse her.

As Governor, she stepped outside of the box and put together of package
of legislation known as “AGIA” that forced the oil companies to march
to the beat of her drum.

Like most Alaskans, she favors drilling in the Arctic National Wildlife
Refuge. She has questioned if the loss of sea ice is linked to
global warming. She campaigned “as a private citizen” against a state
initiaitive that would have either a) protected salmon streams from
pollution from mines, or b) tied up in the courts all mining in the
state (depending on who you listen to). She has pushed the State’s
lawsuit against the Dept. of the Interior’s decision to list polar
bears as threatened species.

McCain is the oldest person to ever run for President; Sarah will be a
heartbeat away from being President.

There has to be literally millions of Americans who are more
knowledgeable and experienced than she.

However, there’s a lot of people who have underestimated her and are
regretting it.

Antique Bronze Freemason Bookends

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These antique bronze Masonic bookends are on sale right now on ebay. They are over 50 years old. When I listed them I misspelled Masonic.

So... Masonic Bookends do not come up in the search engines. There are 4 bids on this auction with 6 days to go. Otherwise, I would be able to revise and correct this auction!

Lucky bidders may not have much competition. If you are interested in finding these on ebay...spell Masonic Masoic and add bookends and then you can see the auction.

So Many Banks, So Little Space!

Expecting more U.S. bank failures, FDIC expands Dallas office

10:46 PM CDT on Thursday, August 28, 2008

By BRENDAN M. CASE / The Dallas Morning News
bcase@dallasnews

Fearful of more bank failures, the Federal Deposit Insurance Corp. is beefing up its staff in Dallas and adding five floors of space to its regional office here, FDIC officials said Thursday.

Local banks aren't necessarily the focus of concern for the FDIC, which insures bank deposits and disposes of failed banks and their assets.

Rather, most of the employees in the FDIC division that handles bank failures across the nation are based in Dallas.

The FDIC announced plans earlier this year to add 140 employees to its Division of Resolutions and Receiverships.

Now it says it may add more than 230, with local staffing going from 164 at the beginning of this year to as many as 397.

The agency is even bringing back 69 retirees to help shoulder the burden.

"With the added workload that we've experienced, we've been expanding," said Ronald Bieker, deputy director of resolutions and receiverships in Dallas.

"We're getting a few floors to accommodate the people we expect to bring on board," he said, referring to the FDIC's offices downtown.

Nine U.S. banks have failed this year, compared with three last year and none in 2005 and 2006, according to the FDIC.

Last month's failure of Pasadena, Calif.-based IndyMac Bank, with $32 billion in assets, was the largest bank failure since the savings and loan crisis in the late 1980s and early '90s.

Earlier this week, the FDIC said there were 117 banks on its "problem list" at the end of June, compared with 90 at the end of March.

Many analysts expect more failures. Gerard Cassidy, a bank analyst at Canadian investment bank RBC Capital Markets, said last month that "upwards of 300 banks could fail" in the next three years.

That would mean still more work for the FDIC's bank failure experts in Dallas.

"The fact of the matter is that banks do fail," said FDIC spokesman Andrew Gray.

"We do our best to plan for scenarios, but we're in an uncertain economic environment, and more failures are likely this year."

While there is no guarantee Texas banks won't be among the casualties of the downturn, the state's banking system is considered stronger than those of many other regions, banking officials say.

The additional FDIC employees here are expected to do everything from managing bank failures to marketing the assets of failed banks to fielding calls from depositors.

The FDIC plans to add 125,000 square feet to the 185,000 square feet it already has in Energy Plaza at 1601 Bryan St.

The building is also home to Energy Future Holdings Corp., the company formerly known as TXU Corp.

McCain picks Alaska Gov. Sarah Palin as running mate

High school Bible class raises concerns

Up to 200 Seagoville students suspended over belts

Employees: 'Hierarchy of hotness' rules at Abercrombie & Fitch

Seagoville students banned from class over belts