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Download | play (h/t Heather)
It's actually amazing in the divisive political climate in which we live that we can find consensus on subjects. Maybe it's a testament to exactly how bad the housing market is that there is no attempt at spin by Sen. Jon Kyl (R-AZ) to dismiss or diminish how bad it is and to congratulate Chris Dodd on his legislation to get things on track. But that's not to say there isn't hackery afoot. Kyl says that the Bush administration is not to blame for the crisis, but it's Congress' fault for not taking a tighter leash in regulations to the mortgage industry.
BLITZER:(H)ow much of the blame does the Bush administration deserve for allowing this kind of situation to deteriorate, as it has?
KYL: Virtually none.
BLITZER: Why?
KYL: We've been predicting for years that this problem would come along. When I was chairman of the Republican Policy Committee, we wrote papers on it.
BLITZER: But isn't the federal government responsible for making sure this kind of situation doesn't happen?
KYL: The problem is, there is very little regulatory authority. That's why this legislation that Senator Dodd has been working on, the one good feature of it is additional regulation. But we should have had that regulation four years ago.
Um, who was in charge of Congress four years ago? Oh that's right, the Republicans. Can you imagine Tom Delay 'hammering' tighter mortage regulations through the House four years ago? Me neither. But Kyl claims they were predicting it would happen. Hmmmm....
Funnily enough, you know who was in office more than four years ago who did lay the foundation for this situation with the legislation he pushed through the Senate? Phil Gramm. Remind me again, what's he been up to lately? And before we absolve the Bush administration completely, it would be appropriate to remember that the watch-dogs to make sure this kind of thing doesn't happen is the SEC. Who appoints the SEC panel? That would be the Failure in Chief. Just sayin'.
BLITZER: A lot of people, Senator Kyl in Arizona, in the housing market out there, they're suffering big-time right now. How much of the blame, and I know you're a blunt guy, how much of the blame does the Bush administration deserve for allowing this kind of situation to deteriorate, as it has?
KYL: Virtually none.
BLITZER: Why?
KYL: We've been predicting for years that this problem would come along. When I was chairman of the Republican Policy Committee, we wrote papers on it.
BLITZER: But isn't the federal government responsible for making sure this kind of situation doesn't happen?
KYL: The problem is, there is very little regulatory authority. That's why this legislation that Senator Dodd has been working on, the one good feature of it is additional regulation. But we should have had that regulation four years ago. The other problem, here, is that much of the bailout here is for the people holding bad loans, not the homeowners. It's for the speculators, the investors. I know in the oil crisis, everybody's concerned about the speculators driving up the price. What do you think happened in the housing market?
BLITZER: Senator Dodd, go ahead and respond.
DODD: No, no, no. Very specifically, Jon, we absolutely seclude speculators from having any benefit all the under the act. That's very clear in the law. Of course, this is a highly regulated industry, Jon. This isn't like hedge funds. The mortgage market has been a highly regulated industry. Where were the cops? Why weren't they out there saying when brokers were luring people in and saying I'm your financial adviser, a fully indexed price, don't worry about it, lie about it if you want, we'll get you into that home.
Those were people that had a responsibility, that failed in that responsibility, and the regulators watching them should have been doing a better job and they didn't do it. That's a major reason why we're seeing the problems we're seeing today. KYL: Just one quick example. There's much to be said. The provision that Chris alluded to that the Bush administration opposes and would veto the legislation over are these CDBG grants. They don't help.
BLITZER: You've got to explain what that means.
KYL: The community development to block grants, which enable local governments to purchase homes from the people who are holding them, the investors that are holding them. It doesn't help the homeowner at all. They're in foreclosure. It helps the people holding the paper, the money. It's a good example of how --
BLITZER: I want to move on, but I'll let Senator Dodd respond.
DODD: The community development block grant is money that goes directly to governors and mayors in order to help them rehabilitate foreclosed properties so they can put them on the market and sell it. It doesn't go to the homeowner at all.
KYL: That's my point.
DODD: That money, because you have declining property values, that is the resources coming from for police and fire and other matters. These are things that mayors need. We provide that when you have floods and hurricanes. This is a national crisis and our communities need to help. But you're not purchasing mortgages with that money at all.
i heard on NPR that a home in coral gables, fl. cost 750k
in 2006 it just recently sold for 342k. the bottom is approaching but it hasn't been reached yet.
You get greater oversight when you demand it. Of course, Kyl and the other ReThugs were noticeably absent from civics class that covered the Checks and Balances concept. What a jackass.
whoa... this is from sen kyl? holy schnikes... the GOP must be in trouble if they are making sense on the economy.
can we please, then, bury the unrestrained capitalism BS?
I'm from Arizona so please allow me to state: Sen. Jon Kyl is a complete right-wing a-hole. Whew, I feel better having said that. Thanks.
Failure In Chief - it has a ring to it.
Regulation is bad. It limits the ability of corporations to screw over the American consumer. Just ask any Republican.
Kyl is against the grants...that's the rub. Because then we can't privatize the "rescue" of these communities in the "free market". We can't have any tax money going to actually help citizens and their communities. That tax money is supposed to go to gooper donors. they give campaign money and then get it back in contracts.
carry on.
As if greater oversight would have fixed our fundamental economic problems. When you have a REGULATORY central bank fixing the interest rates, increasing the money supply, backing all lenders incase they fail(why matter who you lend to if you'll get bailed out?), and regulating everything the market does- of course these problems will happen. Time and time again- the government will blame nameless lenders or "speculators" for each and everyone of our problems when instead it has been the cause. A big example is people continuing to blame "speculators" for Oil's rise in price while ignoring the US dollar's continuing fall.
The housing bubble was created BECAUSE OF THE FEDERAL RESERVE'S ACTIONS OF LOWERING THE INTEREST RATES(increasing money supply) and guarantees of bailing out lenders- it would have NEVER happened otherwise. All other arguments are scapegoats. What Greenspan sought to do by lowering the interest rates was to stave off the recession that should've happened after the dot-com bust(which was another bubble that burst after the Fed propped it up). Booms and busts are not part of some "normal" economic process- they happen because the Fed intervenes in the market.
After Enron- everyone decided we needed more regulation and Sarbanes-Oxley was born. Yet Sarbanes-Oxley does nothing to prevent ANYTHING and all it does is create a larger cost for businesses to operate(I do accounting and have done Sarbanes-Oxley testing many times). These costs are of course passed to shareholders, employees, or customers of the company. In the end we can keep trying to regulate the market- but we will continue to see market failures happen time and time again. "If only we had some regulation" is an extremely diminutive solution that ignores all the fundamental problems the government has created in the first place.
Required @ 6:
True true.
As with any of these pandered interviews and BS questions, 50% is what happened, though the more important bit with the US crumbling is not who to blame and who to point fingers at, that is easy and mostly obvious, it's what to do NOW. Same with peak oil, future of the country kind of things.
Theguy @ 8
I defer to your greater understanding of finances. But it seems to me that part of the Enron problem and perhaps the current mortgage problem was the undoing of checks and balances within the accounting world and within the structure of the financial world. Many conflicts of interest. Just my limited take. And I think regulation can help with that.
Required @ 6:
Saying "regulation" or "deregulation" is extremely general and doesn't define anything- but if I were to speak that way then- infact most regulation is pushed by CORPORATE lobbyists because expensive regulation allows them to stay in business and make sure that competition cannot prop up. Exploitation of consumers can't be sustained in a real free-market(which we do not have), because another competitor will come to offer better products/better wages.
You mean it's not Obama's fault? Apparently everything else is.
8 Theguy Says:
“If only we had some regulation” is an extremely diminutive solution that ignores all the fundamental problems the government has created in the first place."
Good post and I agree. At the end of the day, what we are really witnessing is the slow erosion of the confidence in the Federal Reserve and the U.S. Government's over all monetary policies.
Maybe Dodd can start by doing away with favorable loan rates from mortgage banks to influential politicians, like the ones he and Obama got.
Just sayin'.
Dr. Hussein Matt @ 12:
Have you been asleep at the wheel? Not Obama's fault, but naturally Bill Clinton's.
That would be the reply were a poll to be taken of the idiots to the right.
dennis @ 14:
is that for sure regarding dodd........whatever cam of that?
Theguy is absolutely correct. These politicians are all criminals. They talk about passing laws and increasing regulations, while in the background the central bankers continue to do whatever they want. It is smoke and mirrors. The dollar is going down by the second. The United States is going to become just a third world country (BY DESIGN).
The SnL crisis in the 80s was designed, then everyone put their savings into mutual funds in the 90s (then the bankers crashed the market), then the middle class was tricked into putting what little money they had left into housing (now the bankers are crashing this market). Every single thing is designed so the Super Rich get Richer and the middle class gets poorer. WAKE UP!
dennis @ 14:
Can you please supply specific as to Dobb and Obama regarding their "favorable loan
rates"? Thanks.
doggiebobo @ 18:
http://www.google.com/search?client=safari&rls=en&q=obama%20%2B%20northe...
http://www.google.com/search?hl=en&safe=off&client=safari&rls=en&q=dodd+...
Bunch of sociopaths blaming everyone else but themselves. And apologists like dennis do nothing but distract.
princess @ 19:
ROFL
http://www.google.com/search?hl=en&client=firefox-a&rls=org.mozilla%3Aen...
Here are a few potential effects from the Paulson plan:
"As part of the plan (to help Fannie & Freddie), the administration will also call on Congress to raise the national debt limit, people briefed on the plan said."
New York Times, July 14, 2008
"Treasury Secretary Hank Paulson swatted back reports of government nationalization of Fannie and Freddie, which would mean making explicit what, has long been an implicit taxpayer guarantee of their liabilities. This would instantly add $5 trillion in liabilities to the federal balance sheet, doubling the U.S. public debt burden and putting America’s AAA credit rating at risk. This is a nightmare scenario for taxpayers."
Wall Street Journal, Saturday, July 12, 2008
http://financialsense.com/fsu/editorials/ciovacco/2008/0714.html
all orchestrated when Bush took office in 2000. The last time, Neil's hijynx cost us $1bil....let's see what this banking disaster costs us.
....and don't count on the good citizens of America catching on, I predict when Jeb is elected president, we'll be looking at another housing crisis.
doggiebobo @ 15:
Once Obama takes the office, the last 8 years will not have existed in the feeble mind of the reich-wing. All the problems and destruction over the last 8 years will be the fault of Clinton and Obama.
Save this post. We'll laugh at it for years to come.
Yep, as usual it all boils down to who enforces the laws. If the current administration doesn't obey the laws, what incentive do they have to enforce the laws?
Enron didn't happen because of a failure of laws, it was a failure of enforcement
the Rhode Island nightclub fire was not a failure of laws, it was a failure of enforcement
etc.. etc.. etc..
Jerry @ 9:
putting a guillotine at the base of the Capitol steps is a good start.
here in las vegas the subprime fiasco is cascading into
neigborhoods where homes are under a prime loan.
negative equity is a big problem here. there are thousands and thousands of empty homes....banks still have to care for those homes and there is no property
taxes being collected for public services. which in my opinion (having recently moved here from the midwest) are terrible. there is going to be some deals to be had if you can stand living in las vegas.
Theguy @ 11:
absolutely, once again you are correct. we live in a restricted market that kills innovation and competition. These bastards couldn't be more anti-american.
Dr. Hussein Matt @ 12:
clinton did it!
dosido @ 10:
Regulation that is pushed like Sarbanes Oxley does nothing to prevent such problems. Other companies like Amazon were doing poorly at the time as well, but instead of cooking the books like Enron- they remained honest to their investors who then continued to put capital into the company because of their faith in Amazon- and they were definitely rewarded in the market. People seem to ignore the massive increases in the money supply by the federal reserve in the 90's that gave rise to phony profits and stock price bubbles that made Enron seem valuable in the first place! Its no surprise that normal financial standards were thrown out the window. The SEC also didn't find the crooks at Enron- a hedge fund manager did. If it were up to the SEC it would have gone on much longer due to all the beaurocratic process and paperwork that would take months for any investor to receive from the SEC after filing a request.
Investors on their own began to value companies who had their own strict accounting practicies before the gov't even thought about Sarbanes-Oxley.
The current problems of the financial world has been created by the government in the first place. Once people understand this- the entire picture becomes a lot clearer.
dennis @ 14:
right....a second law stating...no really, you have to obey the first law!
Maybe TheGuy is being polite by leaving this implicit, but Nicole might want to edit the bit where she claims that the SEC is the "watchdog" for mortgages.
displssd @ 25:
...see Karl Rove...oh, that's right, he fled the country!
Joe O. @ 22:
And the fact that I see pretty much no democrats complaining about this- is why I don't defer to every problem we have in this country soley to republican actions.
dennis @ 19:
Dennis,
That is weaker than thin. Even Fox News doesn't think Obama got an insider deal on his loan:
http://bourbonroom.blogs.foxnews.com/2008/07/02/northern-trust-on-obama-...
When even Fox backs Obama on an issue, I think you got to give that one up.
As long as congress supports a central bank, everything else is bullshit.
Theguy @ 34:
I agree with you on that point as well.
Theguy @ 30:
I don't know about your solution. Personally, I'd rather put trust in someone whom I can vote out of office if necessary, instead of counting on the good long-term sense of the folks at amazon.com. Even by your own argument, you need some kind of regulation (and enforcement) against collusion.
Theguy @ 34:
That's because they defer to Dodd on this and Dodd is from CT. Ergo, the banks will be bailed out in the end.
and remember, the Free Market (tm) will fix everything. All we have to do is get rid of All regulations on big businesses. So sayeth the GOP, which is the spokesparty of God.
There are many forms of socialism. The version practiced in the US is the most deceitful one I know. An honest, courageous socialist government would say: this is a worthwhile social purpose (financing home ownership, helping my friends on Wall Street); therefore I am going to subsidize it; and here are the additional taxes (or cuts in other public spending) to finance it.
Instead the dishonest, spineless socialist policy makers in successive Democratic and Republican admininstrations have systematically tried to hide both the subsidies and size and distribution of the incremental fiscal burden associated with the provision of these subsidies, behind an endless array of opaque arrangements and institutions. Off-balance-sheet vehicles and off-budget financing were the bread and butter of the US federal government long before they became popular in Wall Street and the City of London.
The abuse of the Fed as a quasi-fiscal agent of the federal government in the rescue of Bear Stearns is without precedent, and quite possibly without legal justification. The creation of the Delaware SPV that houses $30 billion worth of the most toxic waste from the Bear Stearns balance sheet (with only $1 billion of JP Morgan money standing between the tax payer and the likely losses on the $29 billion committed by the Fed to fund the SPV on a non-recourse basis) is the clearest example of quasi-fiscal obfuscation I have come across in an advanced industrial country. The decision by the Fed to ‘invite’ the primary dealers and their clearers to collude in the (over) pricing of illiquid collateral offered by the primary dealers to the Fed at the newly created TSLF and PDCF (by the Fed accepting the pricing/valuation by the clearers of the illiquid collateral) is another example of the abuse of the Fed as a vehicle for channeling taxpayer-financed subsidies to the primary dealers. This form of socialism for the rich is therefore well-established.
williem buiter financial times
If we can just shrink government down small enough to drown it in a bath tub,maybe then we can push through some responsible regulations.
Old Billy Hussein @ 35:
Thanks, O-Bill. Not arguing with you, but that isn't Fox doing the talking, it's a Director Public Relations from Northern Trust explaining that as a matter of course, they service and pursue successful individuals, families and institutions. Could you not imagine someone that gave Ted Stevens the deals he got not saying the same thing?
I'm in that business, it's not illegal, but when it happens to an up and coming politician who will have a big effect on mortgage legislation, you have to start wondering about hypocrisy.
Neither side is clean on this. Congress is one gigantic country club and you and I are the landscapers.
This is a banking scandal. The private bankers of the Federal Reserve have destroyed our currency. The housing bubble was caused by banks who wanted to generate mortgages to warehouse in the secondary markets so they could be bundled and sold as high grade securities by investment banks, so they could then generate more mortgages via money the banks borrowed from the Fed (which is backed by your tax dollars).
This was the last part of the money grab before the house of cards collapses. And congress? Shit, the bankers tell congress what to do, not the other way around. Blaming congress for the erosion of our currency is like blaming the customer service person in India for causing your computer to break.
And in the end, the only people who are going to lose anything or get hurt financially in this giant nightmare is us. We're going to be left holding this burning bag of shit.
Kyl, another "gift" from Arizona!
c. atrox @ 4:
I too live in AZ and have long ago given up on Kyl to do ANYTHING right insofar as representing people.
Jon Kyl has Never met any deregulation that he dislikes. He has consistently voted against social programs. He has voted with GWB even more than McSame; it was a perfect 100% last time I bothered to check. He voted against windfall profits tax on oil corporations.
The fact that he's now disowning HIS OWN RECORD goes to proove what a cowardly, lying, right wing stooge that he is.
BTW, Jon Kyl has a 100% approval rating on his voting record from "Focus on the Family."
interesting opinion regarding fannie and freddie...all good
for the wealthy at tax payors expense
http://blogs.ft.com/maverecon/2008/07/time-for-comrade-paulson-the-pull-...
Dr. Hussein Matt @ 21:
Love the "princess @" - nice touch.
Why do you people even bother responding to this idiot?? S/he's like a three-year-old, if you stop paying attention they'll stop the tantrums (or in this case, posting stupid crap).
dennis @ 14:
Oh Dennis, I'm SURE no one on your side of the aisle has benefitted from the same deals.
Who does deregulation help?
Who does taking away our personal rights help?
Who does crashing our currency help?
Who does bankrupting our country help?
When you answer these question, you will know who runs this shit hole planet.
"It’s actually amazing in the divisive political climate in which we live that we can find consensus on subjects."
Anybody with half a brain (that is, not the 18-percenters) can agree that conservatives are utter failures at governing.
Dr Acula @ 49:
Conservatives hate to see a black man get a favorable mortgage rate.
alzuben @ 23:
The S&L crisis cost us taxpayers $132 BILLION. That's seems to be peanuts compared with today's mortgage meltdown.
Remember this?
Our Flim-Flammer In Chief pimpin' homeownership (even before 9-11!!):
.. settin' up the suckers for the scam .. heh heh ..
From:
A Home Of Your Own: Expanding Opportunities for All Americans - Executive Summary
Dr Acula @ 53:
i thought i last heard it could reach one trillion...
JTM @ 39:
We also have to keep in mind that Fannie and Freddie are creations of Congress which, ironically where created to address a housing market crisis. Both parties are involved in this and have to be. In fact, any sort of bailout that is offered will probably be voted on unanimously in my opinion.
Taken from Freddie Mac's own website:
"1970: Congress Creates Freddie Mac to Address a National Housing Crisis
Congress created Freddie Mac as part of the Emergency Home Finance Act of 1970 to create and
maintain a secondary market in conventional residential mortgages. In that same act, Congress
also expanded Fannie Mae’s mission to include serving the housing finance needs of the
conventional conforming market."
http://www.freddiemac.com/news/pdf/append1_071604.pdf
Oh, wait...Harry Reid just had a press conference providing the Mormon Democrat bit part pre-scripted response to his buddy W's policies.
What does this mean?
It means that inaction is being met with inaction. Meanwhile the last few pieces are moved into place. And onward to oblivion we march!
Packed like lemings in shiny metal boxes.
Contestants in a suicidal race.
What I don't understand is this... most of the problems came after the deregulation of what qualified people to be home buyers and who could lend money to these home buyers and the deregulation of the mining and cattle industries and the shortcomings of the produce inspections.
How can it be said that regulation isn't the key to help fix this problem, whereas it's the lack of regulation and deregulation that created some of the problems in the first place?
I'm not saying that it's the only thing, because we have a lot of fucked-up issues that need to be addressed. We can't just focus on one at the risk of another, but rather try to slowly come to grips with what happened.
The government screwed up. Why? Because corporations wanted to make a few extra bucks so their lobbiest bought and sold congressmen to pull back... when the mess the corporations had created bears fruitation, what happens? They seek government help to bail them out.
Old Billy Hussein @ 38:
Face it, folks. The whole financial/banking system is one big Ponzi scheme. The dollar is going bust because the people who control the Fed banks and, bascially, the wealth of the world, want it to.
After that, the whole so-called economy crumbles.
Welcome to the third world! (Oh, I got my degrees in finance and economics at the "School of Hard Knocks".)
ThunderMonkey @ 58:
That simply tells you that it's ALL orchestrated. A product of a well thought out plan, executed in unison with vast cooperative resources.
Monkey -
While I might agree that regulation is way to prevent a repeat, regulation is not automatically the fix for the current problem.
Analogy: You prevent bug-bites with Off, but Off is not the fix for the itch you get after you're bitten.
Amitola...You are EXACTLY correct!
If we consume 25% plus of everything, then what happens to the world when we can purchase nothing?
It's called a world wide DEPRESSION.
pinkobait @ 42:
Hey... we need to pull back on any action that requires a violent solution. I understand the setiment, but drowning people is something that Conservatives like to do. We're better than that.
Rusty Steelers = Packers Shackleford @ 52:
Terrible comment, Rusty Stillers=Packers Shackleford. Really bad.
Fine, get your favorable mortgage rates, Senators Dodd and Obama. Just don't preach to us afterward and point fingers.
If someone or something is trying to kill you off (not just you, your whole town, city, county, state, country), do you have the right to defend yourself?
i've heard several interviews from mortgage lenders who knew they were writing up a loan(s) that would not or could not be paid....they wrote it up and sold it.....how these loans once sold to investors in bundles...how they received a A++ rating i'll never know.
Dr Acula @ 53:
I think that is a reasonable assumption. I also think many of those costs will never be factored in but will instead be dismissed as ancillary losses in the current (not)recession.
This is what happens when you let an economic genius(not) with an MBA from Harvard redefine accounting practices inspired by his good buddy Ken Lay.
ThunderMonkey @ 63:
Sarcasm alert-I was para-phrasing Grover Norquist who felt that the markets weren't quite wide open and greed driven enough.BTW "Constituent"?Stop stealing your lines directly from the silly hysterical red baiting article you linked to and try thinking for your self.
ThunderMonkey @ 63:
Monkey -
You need to Google Grover Norquist.
constituent @ 55:
yes, but in 1988 dollars, that $1Tril can now be measured in Pesos.
the idea that regulations and oversight are the problem is INSANITY.
the idea that the market is inerrant, without flaw, and that--given time, and a pound of flesh--the market will solve all of our societal ills is dangerous and takes an extreme capitalist ideology and pumps it up with steroids and happy pills.
the market fundamentalists, despite all evidence, are still trying to convince america that the deregulations (housing, banking, energy, etc.) didn't go far enough.
constituent @ 66:
Duh...because it's all rigged. Being pushed by the same interests. On the Friday before Bear Sterns imploded, the CEO Alan Swartz said publicly in a conference call to investors that Bear Sterns was worth $80/share in break up value. Then over the weekend a Federal Reserve/Treasury executed bail out is orchestrated at $10/share. What the fuck?! It's all an illusion.
dennis @ 64:
But it's true, lil' d. Your industry profits off of discrimination against minorities. Of course I never heard you complain about that...
Hey, greens fees are pricey I guess. Gotta get 'em how you can, right?
Chris Dodd got his kick backs from the corrupt mortgage program sit up by the Bush Administration. Dodd is doing a great job at acting now like he's for the American people. Look many of the Republican and Democrat Law Makers were in on the deals for easy money for homes, now that the cat's out the bag everyone is acting like this all happen by accident. Most Americans are struggling to keep one home while Dodd and others have second and third homes they got by fraud. This is like the criminal investigating the crime.
Local bankruptcies have quadrupled. The property market, which rode the wave of a boom for most of the past decade is now below its peak by anything from a quarter to a third (depending on whose figures you believe), while Nevada now boasts, if that is the right word, the nation's highest foreclosure rate.
The number of empty homes has caused a health scare after it emerged that mosquitoes – possibly carrying the killer West Nile virus – are breeding in abandoned swimming pools. "We've had crews pumping out pools every day this week," Devin Smith, who manages the city's Neighborhood Response Division, told the Las Vegas Review Journal. "Two years ago, we may have pumped six pools in a season. Now we're probably pumping that a week."
JTM @ 61:
That's what I was getting at (not very well apparently), but to simply say that regulation is bad and/or dismiss it would continue to create problems.
Samson- @ 71:
Yes and it is a direct path to Fascism.Unbridled government/corporate power is killing this planet.
When corporations get big enough to cannibalize each other and consolidate more and more power thanks to enough lobbyists to form a conga line around the world 3 times,a little "socialism" can only be a good thing.(and not the socialism for the rich,capitalism for the poor equation Gore Vidal so succinctly drew attention to 40 years ago...)
Las Vegas might be out of water as soon as 2012. Las Vegas used more water per person than any other place in the US. I got the hell out of there in 2005. Now I could go back and buy a house just like the one I sold for half. If the tourism and retirement services sectors weaken greatly, Las Vegas could become nearly a ghost town someday in the not so distant future.
pinkobait @ 68:
I stand corrected... It's okay to joke about drowning someone in a bathtub if we're going to be sarcastic about the process and we're able to draw irony to the process.
I get sarcasm. However... there's good sarcasm and bad sarcasm.
ThunderMonkey @ 79:
Old Billy Hussein @ 38:
You can't vote anyone in the Federal Reserve out of office. The sense of the folks at Amazon is why they're in business and why Enron collapsed. The only enforcement you need is when someone creates fraudulent records and therefore lies to investors and violates contract. The type of collusion we've had in the Enron case has been with government and big business- with Enron paying many politicians. So yes I'd say we'd need more regulation of CONGRESS's activities and of the Federal Reserve.
Samson- @ 71:
Despite what evidence? how can you say there's deregulation when there's a central bank that controls the money supply? This distorts every single thing that happens in the market and has lead to the housing and banking crsis. What you call "deregulation" in those industries has actually been restructuring of regulation- under the guise of "deregulation". Those republicans in office are AGAINST the free-market, which is something not everyone has come to terms with. Energy is one of the most regulated industries out there.
What is truly dangerous and what has been happening is the idea that somehow the government can manage the economy! There is no free-market in this country, these failures have been the result of central banking, congressional spending, taxation, and other interferences in the market- not because of the market acting out on its own.
It boggles the mind. Jon Kyl, hypocrite
pinkobait @ 77:
The US has more in common with a socialist country than anything resembling a free-market. Its true we have more political freedom than what you might imagine of a socialist country- but even that is being eroded as time goes on. So I don't see how any of these failures are free-market failures.
Charles @ 62:
Thank you, Charles! I am actually correct and as I tell my friends "I know everything and I'm always right!"
All of these folks here chatter on about gov't regulation and deregulation, and corporate bad guys doing bad things. The only entity that controls anything in our national economy and really, our lives, is the Federal Reserve and all of the other banking institutions that make up the international fianancial cabal. They hold the wealth. They hold all the gold. They manipulate global markets. They own the friggin' corporations. They're the ones who foment and benefit from the wars.
If they cared about the US economy and the people of the US (or any people besides themselves, for that matter) they would not have enabled the demise of the dollar - or, at the very least they would have propped it up. But they are content to just print more money, encourage ramapnt inflation, destroy teh currencey and the economy and just move on, thank you very much. Nothing to see here....
Disgusting.
ThunderMonkey @ 58:
Because what people are not wanting to understand is that the Federal reserve had indeed caused this problem, and is the MAIN ABSOLUTE CAUSE. When the fed creates money out of thin air- there are no consequences for negative actions and market discipline is eradicated. How is it that deregulation can be blamed when there is no real deregulation? They are just words thrown around- republicans are not for deregulation- that's just the name they give to their restructuring of regulation. Again- if the Fed did not lower the interest rates- it would literally be IMPOSSIBLE for any of this to occur. The Housing market collapsing IS NOT A SURPRISE- people have been predicting it for years before it actually happened because of the fundamentals involved in the government intervening in the market. Look up www.europac.net and look at the video interviews. Go back as far as you want and you'll see Peter Schiff talking sense while all these other "economists" and "forecasters" keep barking that the US economy is doing fine.
The government created the mess in the first place- and then when the Fed makes the mistake of pumping all this money into the country- they want MORE powers and claim they're the ones to fix everything and start to bail these lenders out. The market is too strong for ANY regulation or central planning to work- and it will always correct itself. They can socialize the losses as much as they want- but those companies will still fail. It is people who think they can manage the economy that are the reason we are having these problems.
Charles @ 78:
i'm trying to get out i can't stand it here.......crime is very high....car theft high, illegal immigrants many and
high school graduation rate below 50%.this is not a good place
Theguy @ 82:
so, are you saying the repeal of glass-steagall had no effect? you think that things are better post-glass-steagall?
again, this is simply market fundamentalism re-packaged as market populism. in the quest for the mythical "free" market many lives will be ruined. or, i should say, many more lives will be ruined.
i prefer democracy, thank you
i do like reading your opinions, though, for what it is worth. we just don't see eye to eye.
Obama's Fannie Mae Near-Miss
[Byron York]
Mickey Kaus on Obama's bad-judgment-turned-good-luck:
Didn't subprime poster villain Angelo Mozilo do Barack Obama a big favor by compromising Obama's initial VP vetter, Jim Johnson, with favorable loans, causing Johnson to step down from his position? How bad would today's headlines be for Obama if Fannie Mae fatcat Johnson was still heading up his vice-presidential search effort?
Theguy @ 84:
tell us, what does this mythical "free" market america look like?
i would be curious to read how a market populist envisions the future in an unrestrained capitalism society: with no food, drug, housing, environmental, product regulations, no labor laws, no collective bargaining, etc. how purchasing power replaces voting power, or the idea that one dollar equals one vote.
seriously, i am very curious to see how this capitalistic-utopia looks to you.
Nicole, you are in fine form with this post. Perhaps that email to John Amato yesterday from Noel Sheppard fired you up, huh?
What's amazing to me with this is that with the bailout of Freddie and Fannie, in which the American Treasury will essentially be printing money to pay for, we're gonna have big inflation a year or two from now.... Better stock your pantries now, folks, and learn how to make your own bread grow your own veggies, etc...
LibertyLover @ 91:
Other than getting the SEC and Fed confused....
Samson- @ 88:
Theguy @ 93:
Samson- @ 94:
i give up... i tried to repair my screwy 'quote this comment' error... and i didn't.
it looked correct before i hit 'submit', odd
sorry Nicole, i didn't mean to eat up bandwidth...
Samson- @ 90:
Advocating a free-market does not necessarily mean completely dismantling the government and courts. There are many differnet thoughts on the matter, and I personally believe the government should restrict itself to ensuring people honor contracts and the defense of the country.
But first you have to avoid the idea that the market is some type of wild west situation where without the government everything would collapse.. The market does self-regulate, the Tylenol scare of 1982 is a large example. If a business's reputation is sullied they will go under and more responsible competitors will succeed. As I said before, the SEC did not find Enron's corruption- private individuals did. The FDA's regulations still do nothing as dangerous drugs still get past them while a doctor is not allowed to prescribe a patient marijuana if he wishes. Infact the FDA's regulations ensure that only a large pharmaceutical company can bring anything into the market.
There are also many private organizations today that help consumers in knowing whether or not a business is involved in shady practicies. And with the Federal Reserve socializing any losses that a business might take- of course there's going to be no market discipline because they have nothing to lose. What most of these regulations in effect serve to do is create barriers to entry to the market and help clamp DOWN on competition.
A free-market america would let people be free to trade and work with each other without any government interference. It would return to a focus on production and savings instead of consumption and debt(which is possible through the federal reserve's easy money policy)- and since more people would be able to save due to not being excessively taxed- there would be more wealth, and more businesses would be opening and competing with each other to provide both the best product and best working wages/conditions. Our currency would also not be continously debased due to the fact that no one is in control of the money supply- and people would be free to trade with whatever currency they like(I suspect a currency like Gold would be more sought after in the end).
Of course I'm speaking in big generalities though- specifics on how exactly a free-market works, and how prices are determined are more involved and would take pages. But I'd be more than happy to provide reading material if you ask. Just email at auctionguy10@hotmail.com
Samson- @ 95:
Theguy @ 84:
Nope, it's a lot closer to fascism that socialism, by a long way. Best check up on what the two are.
Americas is a long way from a true free market at the moment, that's why the global orgs have stop it and the US fights trade wars all day long with embargoes and subsidising it's own suppliers. Once the corps fall, then the internet can take idea and product straight from origin to consumer, though that will take a while.
constituent @ 87:
Below 50% ? sheeeesh ......... that's scary.
Theguy @ 97:
thanks for the email address, but i would avoid posting that here... (in fact, i imagine the sitey, nicole, will nix it)
i REALLY don't mean to scamper, but i have to leave very soon. so, before i comment some on your last post i just wanted to thank you for your comments and the viewpoint you provide. like i said, i find it very interesting. and i enjoy a civil and intelligent debate.
now, enuff of the niceties
:-)
pointing out the failures of the regulatory agencies to me is like preaching to the choir.
they are abysmal. but, we see different avenues to "fixing" them. they have failed us, repeatedly. i think this is due to the corporate-govt revolving door, and the fact that many of our reg agencies are headed and staffed by those friendly to whatever sector they are tasked with overseeing. this is not regulation, obviously. now, for me, the answer is to establish rules/laws that ensure that this is not the case. regulators should regulate, not serve as corporate inside-players. that is the problem with regulation, not its existence.
again, i don't think that the market could exist without rules and regulations. maybe you think that rules/guidelines should be decided and imposed by non-govt entities. but, again, we start moving further from any sense of democratic control.
i look at things from a world system theory perspective. and the notion of a "free" market (as i have said a bajillion times) i don't accept the basic premise. like unicorns.
and the 'tylenol' scare... let's get a little more recent. howzabout the pet food scare and the toy scare (i'm referring to the toy that, when ingested, mimicked GHB [i think that was the drug]). had the regulatory agency been better funded, and not controlled by industry insiders, a lot of people would not have lost their pets. kids wouldn't have gotten very ill, etc. to me, and others (i hope), the idea that we have to wait to see the deadly/dangerous effects of a product until it effects us/friends/spouse/kids/neighbor, etc is not the type of society i want to live in. i would rather products be tested, ensured they are safe, etc.
another thing to consider: water and water laws. privatization has proven to be a total failure.
I sold homes for many years. I can attest to the fact that there were once very firm rules for purchasers to meet in order to get a loan. Over the past 10-12 years the requirements were relaxed.....a lot. Instead of borrowers with poor to fair credit needing 10-20 percent down, some folks with lousy credit were given loans with 5 percent down, 100 percent loans, etc. The catch for these borrowers was a very high interest rate or interest only loan in which nothing is paid toward the principle. And you couldn't even refinance out of these nightmares for 2 or 3 years without a huge penalty.
There's only one way this can work. The real estate market has to appreciate constantly. If it doesn't people walk away because they have no investment and no way to make up their shortfalls.
Congress, especially Mr. Gramm and his buddies, changed the rules so that their friends could get rich on high interest rates on these chancy loans. Sorry, Mr. Gramm, if I sound whiny, but lots of nice people got screwed on this deal. Now the federal government will bail out your rich investor friends, but the folks in foreclosure are going to be dealing with this for years to come. I hope to God your man loses so that you don't become something like Secretary of the Treasury. You are a real mess.
Theguy @ 97:
The Federal banking system had no more oversight than has our import of Chinese Drugs and Toys or Mexican produce and at this point God only knows what else may be next.
States that tried to provide some oversight to protect their citizens were attacked by the Bush Justice Dept.
For Immediate Release
January 20, 2004
NY SUES NATIONAL BANK SUBSIDIARY FOR ILLEGAL PRACTICES
"...November 2002, marked the beginning of OCC’s effort to preempt state enforcement of consumer protection laws. Just last week, the OCC issued final regulations designed to prevent state attorneys general from enforcing most state laws against national banks...."
Spitzer New York AG who lead the States against this Republican BS was elected Governor, became a more influential Politician, and had to be Subdued at any cost. Hooker gate did the trick.
Blitzer up to his old corporate shenanigans again. The banks and the mortgage corporations are to blame, not Congress or the administration. Just because some things are possible, doesn't make it right to do them.
Those heroic congressional Republicans, God bless them. Always fighting against the president in the last 7 years on so many issues. It's not their fault. They did everything they could to fight for us common folks. If only Bush had listened to them.
Give me a frickn' break How stupid do they think we are?
Bush was only responsible for signing all of the derugulation bills the repukes passed into law! Besides that, he had very little to do with it!
Oh yeah, that, and ignoring every regulation that was still ON the books! But besides that, he had nothing to do with it.
yakfitguy @ 105:
you ask after 59 million americans supposedly voted to re-elect these thieves?
It's a toss-up as to who wins the "Dumbest Senator from Arizona Award," John Kyl or John McCain. They have both worked tirelessly to outdo each other in their slavish devotion to the Repugnant Party and whatever Lie of the Day there is to peddle.
If you're not insulted by the arrogance of these tin-horn thugs, you're not awake.
Don't forget that as this crises was being created, Bush ordered that NY State not enforce its consumer protection laws, thereby giving the mortgage industry a consequence-free environment in which to practice their predatory lending scams.
Um, who was in charge of Congress four years ago? Oh that’s right, the Republicans. Can you imagine Tom Delay ‘hammering’ tighter mortage regulations through the House four years ago?
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Who kept their rmouth shut? The democrats. I did not hear one democrat polittian holding a press conference or appearing on CSpan to tell the American public NOT to get a zero down, interest only, negatively amortized home loan.
I was appauled when Greenspan told home buyers in 2003, to get adjustable rate mortgages.
It was the bottom of the rate cycle. Rates had nowhere to go but up. I did not hear one congressional democrat tell the American people not to listen to Greenspan. Not one.
No congressional democrat told the public not to borrow equity out of their home when refianancing. Sins of omission. It is too late to complain now, the damage is done. We are now looking at a 1930's economic depression, due to a 1930's style credit collapse.
President Bill Clinton signed Phil Grahm's legislation to dismantle Glass Steagall. The democrats are just as deep in this as the republicans. Congress was warned not to dismantle Glass Steaglall,paticularly in the wake of the savings and loan scandal. Congress was majority republican, but the President was Democrat.
The President did not veto.
Just as with the oil crisis, unlike President Bush's casting blame at democrats, the blame belongs on many parties, republicans as well as democrats. Republicans made no calls for conservation, gave no warnings of Peak Oil. President Bush gave a tax credit to companies which bought gas guzzling Hummers.
I bought a below full size car in 1986. Ran it for 21 years. Replaced it with a car that is rated 35 highway, before things got as bad as they are now. You should come look at the company parking lot and see all the Hollywood entertainment liberal BMW's and Mercedes status symbols.
Amazing what money does to people.
I sold homes for many years. I can attest to the fact that there were once very firm rules for purchasers to meet in order to get a loan. Over the past 10-12 years the requirements were relaxed…..a lot. Instead of borrowers with poor to fair credit needing 10-20 percent down, some folks with lousy credit were given loans with 5 percent down, 100 percent loans, etc. The catch for these borrowers was a very high interest rate or interest only loan in which nothing is paid toward the principle. And you couldn’t even refinance out of these nightmares for 2 or 3 years without a huge penalty.
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The lending standards were not simply relaxed, they were dropped to ZERO. This guaranteed a housing bubble, as people who had no business buying, were allowed to. The banks did not care, because the loans were sold to a third party, placing the risk on somepone else. Upwards of a 500 trillion dollar derivatives bubble was created. this junk debt is in everything and it has not all been exposed to the light of day yet. The risk that the banks placed on someone else, is going to come back at them with a vengeance, as the banks are themselves now sitting on junk debt. What goes around, comes around.
Just like with the stock bubble, the housing bubble became one big party, while the home prces were going up. It was deja vu all over again. "Flip This House" and "My house is Worth What?", were TV shows that ran during the bubble. In the latter, home owners were excited when they got the news that their equity had appreciated and they could borrow even more money on it.
I was sitting in front of the TV, saying to myself, what fools they are. They were going to be in big trouble when the bottom fell out of the market. Just as i expected, it has. Now the foreclosures are piling up.
Now that that the damage is done, the politiitans are calling for tighter lending regulation.
They need not bother themselves- the banks are already doing so. Banks are afraid to lend, just as they were in 1930, after the credit bubble burst.
Democrat polititians say we need to pass bailouts tohelp keep people in their homes. No, what the democrats needed to do was warn the American people not to borrow the equity from thier home and not to buy a home if it took a zero down, interest only, negatively amortized, teaser, adjustable rate mortgage- because they would lose the house if they did.
Bail outs are not going to work. it was a housing BUBBLE. The Nasdq lost 76% of its value after the BUBBLE burst. home values are going to fall farther than people think they will, because it was a BUBBLE. The housing bubble rested on a CREDIT BUBBLE. That BUBBLE has also burst. Credit is deflating. yesterday, Paramount could not get 450 million in fiancing for a slate of features. Multiply that as the CREDIT BUBBLE deflates.
Freddie and Fannie are not well capitalized, as claimed. They are insolvent- which is why the government is stepping in. The goernment has no money to bail out Freddie and Fannie. The government must borrow it. A debtor bailing out a debtor. The stock market dropped on Monday and is down, thus far today. That is the reaction to the bailout- because more fallout is coming.
Everyone is talking about inflation, so why doesn't the FED raise rates? Because the problem is not inflation. It is deflation. 1930 is at the doorstep.
Paul @ 109:
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And who didn't speak up about that? Democrat politians saw their home values go up as a result of the housiing bubble, which was based on these predatory loans. Chris Dodd got a friends of Angelo loan from CountryWide. Both political parties are deep in this together.
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