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Good morning RS!
In my on-going quest to urge you to spend a little time on important stuff, here’s an example of a response I wroth to a fellow conservative:
The crisis we find ourselves in today was caused by the federal govt (read: Barney Frank) forcing banks and loan institutions to hand loans to people who had no credit, no jobs, and no money down.
When the teaser rates expired, and the balloon payments came due, these people defaulted causing more houses to go on the market.
As more houses came on the market, prices dropped.
Other people then were put in a position where what they owed was more than the house was now worth, so some simply walked away from their homes, and got an apartment, living as they had before the federal govt had interfered in their lives.
This has been going on for years and now has come to a head. Then, Treasury Secretary Henry Paulson took money that was for buying these mortgages (for the fed govt to hold until the housing mkt had recovered) and handed it to AIG and others without any demand of transparency.
The banks responded by secretly paying bonuses, and holding the money close to their chests. So, some 300 billions was essentially pissed away.
The economy will recover with or without the fed govt because of lower gas prices putting about 1 billion in consumers pockets daily, and low mortgage rates causing refinancing that will result in lower house payments, therefore more cash for consumers to spend there as well.
Things will be rough until about September of this year, then we will see a good recovery, unless the fed govt does something else stupid.
Also, the govt needs to demand greater transparency both in the private sector and in its own agencies. It’s outrageous that Madoff could get away with what he has, right under the noses of the SEC dumb-asses.
Here are three things that desperately need to be done:
1. Any company that is too big to be allowed to fail must be broken up. For example, the Cadillac brand needs to become Cadillac Motors with no connection to GM.
2. The dollar needs to be returned to a commodity standard and fiat currency needs to go away. Our fiat currency has led to inflation and inflation creates poor people.
3. The federal govt must become smaller and more transparent. For example, no more federal money should be used for welfare. None.
Hurricane Katrina revealed the results of that kind of shit. We don’t need a dependent class in this country. Let Europe do that stuff. - Grimgold
Good morning RS!
Guten morgan, Herr Grimmy!
“In my on-going quest to urge you to spend a little time on important stuff, here’s an example of a response I wroth to a fellow conservative:
“The crisis we find ourselves in today was caused by the federal govt (read: Barney Frank) forcing banks and loan institutions to hand loans to people who had no credit, no jobs, and no money down.”
Grim, you have to stop getting your economic history from Rush Limbaugh. That’s ludicrous on the face of it — Barney Frank and the Dems were in the minority in the House from 1994 until 2007 — exactly how did they ‘force’ banks and loan institutions to give loans to people who couldn’t afford to pay them back? In fact, it was Junior Bush and the GOP who eased lending restrictions — remember the ‘ownership society’? — part of Karl Rove’s scheme to build a permanent Republican majority — he noticed that the data said that home owners tended to vote Republican. Another aspect is that there was big money in this kind of lending until the bottom fell out of the housing market. I know someone who was in the business of making these kinds of lucrative home loans until two years ago — he wasn’t forced by any Democrat to extend credit; his desire for money, and the lack of regulation of the lending business, did that. The lax oversight of the federal government, and the discovery of a new way to steal with hedge funds and derivatives by Wall Street, along with plenty of old-fashioned greed, are what precipitated this crisis, not Barney Frank.
“When the teaser rates expired, and the balloon payments came due, these people defaulted causing more houses to go on the market.
As more houses came on the market, prices dropped.
Other people then were put in a position where what they owed was more than the house was now worth, so some simply walked away from their homes, and got an apartment, living as they had before the federal govt had interfered in their lives.
This has been going on for years and now has come to a head.”
Isn’t it terrible how all those wily folks in the middle-class put it over on all of those naive bankers and their lawyers, scamming them into lending them money on homes they couldn’t afford? I mean, just because investment and commercial banks, second-mortgage lenders and the other detritus of the housing market were making record profits up until two years ago I’m sure had nothing to do with it. No, it was those slick middle-class con artists with their families and children desiring a better life that caused this mess, forcing the innocent banks to lend them money! They should be ashamed of themselves!
“Then, Treasury Secretary Henry Paulson took money that was for buying these mortgages (for the fed govt to hold until the housing mkt had recovered) and handed it to AIG and others without any demand of transparency.”
And he violated the law by doing so. The bailout money was intended for FDIC-approved commercial lending institutions and, unless the Republicans changed the law, it is illegal to give it to investment banks or insurance companies. However, since Republicans are no longer held accountable in Washington — that’s reserved for Dem simps like Rod Blagojevich — Paulson is still at Treasury and Bernanke is still blowing bubbles, or something, at the Fed.
“The banks responded by secretly paying bonuses, and holding the money close to their chests. So, some 300 billions was essentially pissed away.”
True, and it should come out of Paulson’s hide, but it won’t.
“The economy will recover with or without the fed govt because of lower gas prices putting about 1 billion in consumers pockets daily, and low mortgage rates causing refinancing that will result in lower house payments, therefore more cash for consumers to spend there as well.”
If they have a job that pays any money. The underpaid underemployed aren’t even being counted, but I have met a carload of them in the past seven years.
“Things will be rough until about September of this year, then we will see a good recovery, unless the fed govt does something else stupid.”
Things will be bad until January 2010 — the other shoe hasn’t dropped yet, and it’s only going to get worse. The impact of Obama’s stimulus spending will take a year to filter down to the averge American, just as it did with FDR’s economic recovery programs in the 1930s.
“Also, the govt needs to demand greater transparency both in the private sector and in its own agencies. It’s outrageous that Madoff could get away with what he has, right under the noses of the SEC dumb-asses.”
I agree and it’s an outrage that Madoff would still be running his Ponzi scheme if he hadn’t confessed. The Republican-run SEC has been a disaster to the point of treason.
“Here are three things that desperately need to be done:
“1. Any company that is too big to be allowed to fail must be broken up. For example, the Cadillac brand needs to become Cadillac Motors with no connection to GM.”
That might work or, at least, take them out of the ‘too big to fail’ category. The enormous multi-national mega-corporation has reached the point of extinction anyway — not only can they not serve their customers anymore, but they can’t even serve themselves and their shareholders.
“2. The dollar needs to be returned to a commodity standard and fiat currency needs to go away. Our fiat currency has led to inflation and inflation creates poor people.”
Good luck with that. We’re off the gold standard, or any other standard, permanently. The only way this has even a slight chance of happening is if there is a massive worldwide depression, worse than any in history.
“3. The federal govt must become smaller and more transparent. For example, no more federal money should be used for welfare. None. Hurricane Katrina revealed the results of that kind of shit. We don’t need a dependent class in this country.”
Actually, it depends on what you mean by welfare. Is Social Security welfare? Both the employer and employee pay into a not-for-profit government-administered trust fund so that the worker can live a decent life in retirement. Is that welfare? And what should we do about poor or sick people who are incapable of taking care of themselves — toss them in the street and watch them die? In my experience, I have met many people who disdain welfare and don’t want a dime of their money used to help someone less fortunate, until disaster strikes them — then they’re the first in line for the free government cheese. If you are down on your luck someday, Grimmy, are you just going to crawl into a hole and die, or would you accept a hand-out from your fellow citizens to help get you back on your feet?
You’d have a better case here if anyone who wanted to work was guaranteed a good-paying job, but we don’t have that in this country, and there aren’t even enough low-paying jobs for all those who want to work. When society isn’t providing enough jobs, is it fair to tell people who can’t possibly find work, since it doesn’t exist, to go rot or become criminals? The country was founded as a commonwealth — the government should act for the common good of society and the people — is it good for society to drive people to death or crime to avoid starvation? Is that the kind of country you want to live in? Incidentally, we currently have a dependent class in this country; they are the wealthy top ten percent and our taxes are going to underwrite their profits and luxurious lifestyles. ‘No welfare’ sounds like a good theory to conservatives but, like Supply-Side economics, in practice it just doesn’t work. Name one country in history that has had absolutely no welfare for it citizens and I’ll show you a failure.
Katrina revealed the total incompetence-on-purpose of the Bush Regime, not that people don’t need and deserve help in an emergency. But then again, Grimmy, perhaps you think you are your own best fire department.
BTW, the Katrina victims are a sore point with me since a good friend of mine is one. She owned a building in NOLA that was destroyed in the aftermath of Katrina. Her insurance company refused to pay to rebuild, even though she had excellent flood insurance. Since 2005, she has been living on her property in a trailer she bought at her own expense, trying to find financing to rebuild. Incredibly, even with the housing bubble, and even though she has good credit, she couldn’t find a bank in Louisiana that would give her a loan. She’s beginning to smell a rat, though — she lives on the edge of a tourist trap, and she’s noticing big new hotels and franchises going up nearby while the city is trying to find some way to get rid of her. She’s also constantly offered low-ball money by smiling young men with briefcases for her land, but she’s doesn’t want to sell at a loss. She’s lived there for many years and she’d like to stay, but now the city is talking about condemning the property to get rid of her, so she might have to sell, even at a low-ball price. She thought it was curious that she caught a surveyor on her land early one morning who admitted he was hired by a fast-food company and was plotting her property for a new outlet. Of course, in corrupt NOLA, this wouldn’t have anything to do with the city threatening to condemn her land, now would it. This is America?
“Let Europe do that stuff. - Grimgold”
I hope you never get seriously ill in this country, Grimmy, especially with a long-term chronic or terminal condition — you’ll discover the rare tortures our for-profit medical system puts you through if you aren’t wealthy, the kind of bureaucratic nightmare unknown to those horrible, but healthy, Europeans.
RS!
His Greatness, The Wonderful Maha-Rushi is a good source for economic history. Unfortunately, I don’t listen to him much anymore because whenever I turn on his program, all I hear is Obama, Obama, Obama.
I agree with you about hedge funds and derivatives, and lax govt oversight. You failed to mention, however, the uptick rule and the requirement that stock short positions are supposed to be done with borrowed stock, not naked. It’s worth mentioning….
Regardless who’s at fault (a favorite liberal game, assigning blame rather than focusing on the problem) it’s good to see Barney Frank acting like an adult.
The Wiley Middle Class didn’t put anything over on anybody; it was real estate agents exhibiting their usual greed, as a result of govt putting pressure on their banks to make loans to the poor; those who haven’t any down payment, no job, and no credit.
You are correct, Paulson needs to be fired, and it should be made certain he does not monetarily benefit from his actions.
Obama’s spending program won’t do diddly squat. Sorry. It will make him look good as naïve liberals weep with joy.
Expansion of the fed govt is bad because fed govt is dishonest. Period.
Taking companies out of the ‘too big to fail category’ is exactly equivalent to removing a large chunk of cancerous socialism from the American body. In this country companies should not be protected by the federal govt. It’s outrageous.
Social Security is welfare. If the fed govt was honest, a worker might be able to live a decent life in retirement. As it is, it benefits govt more than elderly people, as I’m sure you well know in spite of the way you present it to me.
It shouldn’t be the job of the fed govt to keep people from crawling into a hole and dying. Accepting a handout from a fellow citizen is light years different than accepting a handout from the fed govt. Think about it.
If the govt insists on providing welfare because of people who’s hearts are bleeding all over the place, then it should at least be workfare, whenever possible. No federal welfare is better because it’s the most dishonest, uncaring, and wasteful possible way to keep people from starving to death.
You are absolutely right about the fake property condemning going on. It’s evil, obviously, and brought to us by the same people you expect to feed the hungry and clothe the cold and miserable.
Dear God, you have put me to work! Now I suppose I have to look for proof that it wasn’t just GW and the country club republicans, but Bill and Barney as well that have caused this mess.
GEEZ!
Grimmy
Oops! So much ground was covered I forget an important one. You said:
‘Good luck with that. We’re off the gold standard, or any other standard, permanently. The only way this has even a slight chance of happening is if there is a massive worldwide depression, worse than any in history.’
Your fatalistic attitude concerning getting away from fiat money dooms the people you care about.
The poor, starving, and homeless are the ones most affected by inflation.
As our fiat currency becomes worth less (which it surely will with the fed happily pumping ever more dollars into the economy) those that would crawl in a hole and die without assistance will be even worse off. Instead of sighing and accepting the idea that inflation is inevitable, I ask you to spend some of your long-winded and prolific pen actually fighting for those you supposedly care about and encourage our beloved leaders, especially Saint Obama, toward a solid currency.
I certainly am. Called a congressman yesterday in fact, and, among other things, said this to his call-taker:
INFLATION CREATES POOR PEOPLE.
Grim
Grim, I’ll respond to you in more brevity tomorrow or the next day — didn’t have time today.
Understood!
I also have a life and can’t pay more than a small amount of time to politics.
Grimmy
Grimmy, I tried to post a response, but I was informed it seemed ’spammy’ and to try again. I’ll try again tomorrow.
Well, I tried again today and got that same ’spammy’ message. I think I’ll have to post this as a Tattlesnake column.