The global meltdown triggered a $145 billion government stimulus package dubbed Project Lifeline. Project False Hope is more appropriate. The stimulus was created and advocated by the banks that service half of the U.S. mortgage market ─ Bank of America, Citigroup, Countrywide Financial, J.P. Morgan Chase, Washington Mutual and Wells Fargo ─ all members of the so-called Hope Now Alliance. You bet banks are always hoping to be given a lifeline by taxpayers whenever they mess up. And guess who cleans up and pays for the mess? Why should the government repeatedly come to the banks rescue whenever enough of them are in trouble at the same time?

The subprime story is a bad rerun. Nothing new here. It happens repeatedly. New financial instruments and an enthusiasm for risk-taking create dramatic increases in credit, which drive up asset prices thereby justifying still more credit expansion and still higher asset prices. Then comes a top to asset prices and they have to be marked to market. Panic selling followed by a credit freeze results in mass insolvencies and a recession ─ or worse. All  the millions of struggling homeowners receive is false hope. Borrowers who have outstanding student or automobile loans and consumer credit will face the same false hope unless real political will to tackle the credit crisis is asserted.

"I was gradually coming to believe that the U.S. economy's greatest strength was its resiliency ─ its ability to absorb disruptions and recover, often in ways and at a pace you'd never be able to predict, much less dictate," former Federal Reserve Chairman Alan Greenspan wrote in his book The Age of Turbulence. Wishful thinking by the man who created the mess. Man was he wrong. Now is that any way to manage a monetary policy? Any wonder the financial system is broken and broke?

The Bank for International Settlements said credit default swaps totaling $43 trillion, half the entire asset base of the global banking system were outstanding at the end of 2007. That is reality.

False hope and austerity measures are not the way to correct global imbalances. America needs to export its way back to balancing its books with countries like China and OPEC members increasing their imports from America. It doesn't make sense and is unsustainable for America, with only five percent of the world population, to continue to consume 30 percent of global resources. Growth and prosperity in the developing world also offer America more export opportunities.