TheEconomicCollapseBlog.com | The Democrats, the Republicans and especially Barack Obama promised that something would be done about the too big to fail banks so that they would never again be a threat to destroy our financial system.  Well, those promises have not been kept and the too big to fail banks are now much bigger and much more powerful than ever.  The assets of the five biggest U.S. banks were equivalent to about 43 percent of U.S. GDP before the financial crisis.

Reuters | The Federal Reserve has moved closer to embarking on a new round of its controversial money-pumping after the central bank and its chairman Ben Bernanke highlighted a grim outlook for the U.S. economy. Bernanke on Wednesday opened the door a bit wider for the Fed to return to buying securities in the months ahead to buttress a weak recovery and keep inflation from slipping too far below its newly adopted 2-percent target.

ZeroHedge.com | As first reported here, two weeks ago European banks saw the amount of USD-loans from the Fed, via the ECB's revised swap line, surge to over $50 billion - a total first hit in the aftermath of the Bear Stearns failure prompting us to ask "When is Lehman coming?" However, according to little noted prepared remarks by Anthony Sanders in his Friday testimony to the Congress Oversight Committee, "What the Euro Crisis Means for Taxpayers and the U.S. Economy, Pt. 1", we may have been optimistic, because the end result will be not when is Lehman coming, but when are the next two Lehmans coming, as according to Sanders, the relaunch of the Fed's swaps program may "get to the $1 trillion level, or perhaps even higher."

Infowars.com | The road couldn’t be bumpier. As the G20 meet today in Cannes, you can bet that the embattled Greek PM George Papandreou will be getting ‘the hair-dryer treatment’ from Germany’s Angela Merkel and France’s Sarkozy. Back in Athens, Evangelos Venizelos, the Greek finance minister and the PM’s likely successor – was hospitalised on Tuesday suffering from the mother of all stomach ulcers.

Stand Up America | The fact that the Federal Reserve is neither “Federal” nor a “Reserve,” and also not part of the official Federal Government is now clear to most of the world, and certainly to the concerned citizenry of the USA, finally. What is not known, but bandied about on the internet for quite some time is: Where did the money go?

Independent | Up close, the most striking feature of the reforms being forced on Greece by its international creditors is their destructiveness and futility. The pay cuts, tax rises, cuts and job losses agreed to by parliament in Athens last week will serve only to send the economy into a steeper tailspin, even if it extracted a much-needed €8bn in bailout money from the EU leaders. "Nothing but a lost war could be worse than this situation," one left-wing ex-minister tells me. "What is worse, no party or political group in Greece is offering real solutions to our crisis."

RonPaul2012.com | The Ron Paul 2012 Presidential Campaign announced the release of Dr. Paul’s “Plan to Restore America,” an ambitious federal government spending, tax and reform blueprint that as President he will implement. The plan, authored by Paul’s campaign staff at his direction, promises to restore the federal government to its former Constitutionally-limited, smaller-government and less-burdensome place.  The plan cuts $1 trillion in federal spending during the first year of a Paul Presidency and delivers a balanced budget in year three of a Paul Presidency.

Telegraph | The head of the IMF has warned that its $384bn (£248bn) war chest designed as an emergency bail-out fund is inadequate to deliver the scale of the support required by troubled states. In a document distributed to the IMF steering committee at the weekend, Ms Lagarde said: "The fund's credibility, and hence effectiveness, rests on its perceived capacity to cope with worst-casescenarios. Our lending capacity of almost $400bn looks comfortable today, but pales in comparison with the potential financing needs of vulnerable countries and crisis bystanders."

Reuters | Iceland's president accused European countries on Sunday of having bullied it into agreeing to guarantee repayment of the debts of a failed bank, reviving a dispute with Britain and the Netherlands whose citizens are owed billions.

Guardian | For the past two centuries and more, life in Britain has been governed by a simple concept: tomorrow will be better than today. Black August has given us a glimpse of a dystopia, one in which the financial markets buckle and the cities burn. Like Scrooge, we have been shown what might be to come unless we change our ways.

Business Insider | One of the most outrageous "open secrets" of U.S. government policy these days is that the Federal Reserve is still paying big banks not to lend money. And it's doing that while screwing average Americans who have been responsible and lived within their means.

EndOfTheAmericanDream.com | A one-time limited GAO audit of the Federal Reserve that was mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act has uncovered some eye-popping corruption at the Fed and the mainstream media is barely even covering it.  It turns out that the Federal Reserve made $16.1 trillion in secret loans to their bankster friends during the financial crisis.  You can read a copy of the GAO investigation for yourself right here.

BBC | Demonstrators around Syntagma Square in Athens responded by throwing yoghurt and stones. Thousands are taking part in a general strike, the third in Greece this year. Prime Minister George Papandreou faces the risk of a revolt in his Pasok party over the austerity package. He is seeking support for a new austerity programme of 28bn euros (£24.6bn; $40.5bn) in cuts to take effect from 2012 to 2015.

CounterPunch.org | Stocks dropped on Monday as Europe's sovereign-debt crisis deepened and bond yields across the EU periphery headed sharply higher. The euro fell hard against the dollar ($1.40) while the Greek 10-year bond spiked to 17 per cent before mounting a modest comeback. The situation is getting desperate.  Most economists now believe that Greece will have to restructure its debt. But bondholders are doing everything they can to make sure that doesn't happen because they stand to lose billions on their investments.

Bloomberg | European Union finance ministers cleared the way for Portugal to receive 78 billion euros ($110.8 billion) in aid, making it the third euro-area country to fall back on official loans. The EU’s two bailout funds, the European Financial Stability Facility and European Financial Stabilization Mechanism, will each provide one-third of the assistance, while the International Monetary Fund will contribute the rest, the EU said in a statement after a unanimous vote in Brussels today.