For those GOP establishment types that are pushing former Kansas City Fed Chair (’92-’96) Herman Cain as the man to fix the economy and rescue a collapsing financial system, watch Mr. Cain try to excuse his way out of not seeing the housing bubble. Then watch the cast of ‘Morning Joe’ ask Ron Paul how he knew and was warning about the collapse in 2003. The next bubble is the ‘dollar bubble’ and we’re in it right now. Wake up folks; Herman Cain is just more of the same with an even better disguise. (more…)
Love it or hate it, we absolutely have to do something about the tsunami of government, corporate, and personal debt that is drowning this country and depressing productivity. I am guessing Mr. Ryan has read the book I am reading right now.
Massachusetts woke up earlier this year and reclaimed “The Kennedy” seat for the people when they voted for Scott Brown. Now they have an even better choice in Sean Bielat to retire one of the main reasons for the financial collapse which started with the housing bubble created by the Dems’ Community Reinvestment Act in 1977 and continued with the House Financial Services oversight by 30 year career politician, Barney Frank. Mr. Frank, by the way, has absolutely no private sector or business experience at all; none, nada, zip. How does a guy that knows nothing about how a business actually survives and thrives, become the chairman of one of the most influential, (if not the most influential), committees in Congress? How?
I don’t think that Fannie and Freddie are financially insolvent. I don’t think they need large bailouts. – Barney Frank, 2008
and my personal favorite:
I doubt that Treasury will write a check to Fannie and Freddie – 2008
Not only has the Treasury written $148 billion in checks, but on December 25th, 2009 (Merry Christmas!), the Treasury lifted the $400 billion dollar cap for these two mortgage giants allowing them unlimited funding. The worst case scenario for the bailout of Fannie and Freddie is $1 TRILLION.
Barney has been the Chairman of the House Financial Services Committee since 2007 which oversees the financial services industry in it’s entirety; housing, banking, investment, securities and insurance. Nobody could be this stupid, and from everything I have seen of Mr. Frank, he is one of the most intelligent people in Congress which bodes darkly for us. A service and conflict record of an employee in the private sector this lacking in judgement would beg for dismissal. Massachusetts now has a choice; may they choose wisely.
May I introduce to my readers the constitutional candidate (with a business background) that is giving Barney the first competition he has felt in more than two decades; Sean Bielat.
I do believe that Sean’s Wharton MBA sheepskin trumps Barney’s Harvard law degree when it comes to fixing the economy, and we all know that ‘it’s the economy stupid!’.
Program Manager, iRobot Corporation. Led $100 million, 100 person business line providing life-saving defense robots used to destroy roadside bombs in Iraq and Afghanistan
Chairman, NATO Industrial Armaments Group. Led an international team studying the potential for use of advanced reconnaissance technology in urban warfare
Management Consultant, Mckinsey & Company
Lieutenant, U.S. Marine Corps (active duty)
Sean and his wife are residents of Brookline, MA and recently had their first child, Theo. They are members of St. Mary of the Assumption Catholic Church in Brookline. Sean currently works as an independent consultant and serves as an officer in the Marine Corps Reserve.
Sean worked his way through college and graduate school, aided by scholarships and the GI Bill. He now holds a Master in Public Policy from the Harvard Kennedy School of Government, a Bachelor of Arts from Georgetown University, and a Master of Business Administration from The Wharton School, University of Pennsylvania. He is a member of the Knights of Columbus, the International Institute for Security Studies, and the Council on Emerging National Security Affairs.
As I have stated in the past, all of these local races have become national referendums on the continued survival of America as a free nation. Scott Brown, Charles Djou, Nikki Haley, John Willoughby, Allen West, Marco Rubio, Dan Benishek, Christine O’Donnell, Sharron Angle, Joe Miller…and the list goes on. Please donate to Sean’s campaign in any way that you can as taking down the great white shark, Barney Frank will do more to demoralize and derail the progressives than any other candidate except for Nancy. Remember, the other sweetheart deal, money man, Chris Dodd, is retiring.
Yet another sleepless night with 25 days to go before we know exactly how big the tsunami that is about to wash over the democrats is, or whether or not it is going to make any difference at all to the current state of affairs.
How many of you can relate? Sleepless night after sleepless night worried about still not being able to find a job because you are too old and not one, but two, former industries have been completely collapsed by the progressives in Congress, the White House, and the Federal Reserve? Worried about becoming homeless with a child that already has PTSD and wondering how that is going to affect their ability to cope. Constantly worried about a family member becoming ill and not having any medical insurance. Constantly worried about how to pay the bills and put enough food on the table to keep the family mentally and physically coherent. Waiting and praying that there will actually be a collective sigh of relief when the Congress is flipped, and hoping that the Republicans don’t turn their ‘chance’ for redemption into one big cluster**** that drives us further into depression.
Is that resonating?
The GOP has put forward their ‘Pledge To America‘ that lacks creativity, bold reasoning, decisive measures, and for lack of a better word, vision. In their rush to sell themselves to moderates and indies, they have created a lukewarm beginning to the problems that face this country and have NOT embraced their ‘inner no’.
I have a better idea. Want to hear vision? My readers will let me know if I’m over the line on what I believe needs to be done. Time to think outside the box when it comes to hitting the escape key on this system and re-inventing America once again.
Vision For America
CUT SPENDING! Make earmarks illegal. If a program does not fit inside the guidelines of the Constitution, it becomes mincemeat. Considering the items that follow, there will be more than enough money for Americans to make sure those turtles have crossings, and whatever replaces the NEA (privately) will be able to make art happen.
Cut Spending – Abolish the private banking cartel known as the Federal Reserve System, cut up the credit card they provide to Congress, and stop paying interest on our money. That is the most heinously idiotic damn thing I have ever heard.
Break the unholy alliance between the six biggest banks in the country and the federal government. Shut down the revolving door between Goldman Sachs and their brethren and the Treasury Department.
Cut Spending – Abolish the IRS whose entire existence revolves around siphoning off Americans’ wealth in order for the progressives to redistribute our wealth to the rest of the world, and to make sure the Federal Reserve Mafia gets their interest. We would save $12.1 BILLION immediately, and give over 100,000 Americans a chance to make a living doing something they can take pride in.
Institute a fair or flat tax that is consumption based. This would bring trillions of dollars in investment money back from the Caymans and other offshore banking areas, and it would tax the underground economy.
Repeal Obamacare and replace it with a free market solution that TAKES EMPLOYERS out of medical insurance completely. How many of you feel like indentured servants having to take certain positions or stay at companies because they have you over a barrel with your benefits? How many healthy Americans are being penalized with higher premiums because other members of the group policy haven’t taken care of themselves and are using benefits like water? How many of us don’t even have benefits because we aren’t employed?
Repeal the Dodd/Frank financial reform FIASCO that gives even more control over Americans through banking institutions and their money, yet doesn’t address the biggest factor in the continuing housing collapse – GSEs Fannie and Freddie. Fannie Mae has returned to its subprime lending terms on foreclosures, while we are still shelling out billions to keep Fannie and Freddie afloat.
Remove the federal government as the guarantor of last resort for credit cards (bank bailouts), student loans, mortgages, etc. This IS NOT their job and never was. Is it in the Constitution? Nope! Shitcan it.
Pass a Constitutional Amendment making presidential czars and federal government agency mandates illegal. If the EPA wants to tell Americans that carbon dioxide is pollution, it has to be debated by elected officials. If Cass Sunstein wants to ‘nudge‘ America, he is going to have to receive permission from us.
Take Social Security, Medicare, and Medicaid away from Congress and the Treasury. The lockbox for these government entitlement programs was a flat out lie and has never existed. I am sure with minds like Steve Jobs, Steve Wynn, Donald Trump, and Hermain Cain, we can find a profitable, yet safe, retirement savings avenue for Americans to watch over their nest eggs.
Remove the United Nations from our country, literally and figuratively. Rescind treaties under the guise of the United Nations; STOP sending Americans’ wealth to them; kick the IMF and World Bank out. Deal with the fallout and then not only play by the rules, but write laws that protect America’s sovereignty. It may be a global village (according to the Fabian Socialists) but without a leader, it will become even more chaotic.
Pass a Constitutional Amendment that forbids a central bank system from being established in America ever again, and remove the Treasury Department’s involvement with the Bank of International Settlements.
Stop using the power of the Executive Branch to strong-arm the world into compliance with what the global elites feel is in their best interest. We don’t give a flying squirrel’s fluffy freakin’ tail what you want; you are wealthy enough already. You aren’t going to be allowed to become yet wealthier by using shady underhanded schemes; i.e. Iraq and Afghanistan. Thanks George and Dick.
Introduce and pass legislation that forbids think-tanks and NGOs from writing legislation; i.e. Apollo Alliance – Stimulus Bill or the Council on Foreign Relations.
Assign a Congressional task force to examine and recommend repeal of laws that have been passed in the last 150 years that are blatantly un-Constitutional, threaten liberty, privacy, and free enterprise.
Repeal the Patriot Act in it’s entirety.
STOP SPYING ON AMERICANS with cameras, illegal wiretapping, data mining protocols, etc. Tighten the supervision of America’s intelligence community, and require them to share the data they do acquire.
Remove American military bases from islamic countries. Stop providing the radical jihadists with another reason to attack America.
Introduce and pass legislation that forbids genetically modified organisms from being produced and require the multinational companies creating this organisms to clean up the pollution that they have introduced to the environment. Are you listening Monsanto?
Introduce and pass legislation that forbids Big Pharma from creating viruses, patenting them, and patenting the genetic code of Earth’s lifeforms.
Introduce and pass legislation that forbids ‘Too Big To Fail’.
Introduce and pass legislation that requires term limits.
Introduce and pass legislation that makes lobbying illegal.
Pass a Constitutional Amendment protecting Americans’ right to bear arms – in perpetuity.
Pass a Constitutional Amendment that requires nominees to the United States Supreme Court to actually have judicial bench time. Also require that the nominee in question not have been in the employ of the Executive or Legislative Branches, and show a history of interpreting law according to the Constitution and American Sovereignty.
Pass a Constitutional Amendment that emphatically states what a Natural Born Citizen is (born on American soil to two American citizens), and then require all candidates to comply with requirements proving they are natural born for the office they are seeking (if required).
Close the freakin’ border! Understand that Mexican citizens are ‘invading’ sovereign American soil and we will not tolerate it. Locate and deport all illegal aliens as their prize for disrespecting our country and breaking our laws.
How’s that for a rant session? Please feel free to add what you believe should be done to get our country back on the right track.
There aren’t very many people I detest more than George Soros (though Mishy does come immediately to mind), and his ability to write op-eds and have them published drives me bananas. His latest hogwash from the Financial Times, for example, writing about how more stimulus is necessary when we are close to $14 Trillion in debt. Yeah, just keep digging would be Georgie’s advice.
But the crash of 2008 was primarily a failure of the private sector. US (and other) regulators should be faulted for failing to regulate. Without a bail-out, the financial system would have remained paralysed, making the subsequent recession much deeper and longer. Similarly, the US stimulus package was a necessary measure. The fact that most of it was spent to sustain consumption rather than on correcting the underlying imbalances was unavoidable due to time pressure.
Where the Obama administration went wrong was in how it bailed out the banking system: it helped the banks earn their way out of a hole by purchasing some of their bad assets and supplying them with cheap money. This, too, was guided by political considerations: it would have been more efficient to inject new equity into the banks but the president feared accusations of nationalisation and socialism.
Oh really? If you aren’t reading Market-Ticker every single day, you aren’t aware of what is really going on.
Worse, you can count the number of people who went to prison on the fingers of one hand, AND NOT ONE GOT NAILED FOR KNOWINGLY FALSE – MALICIOUSLY SO – SECURITIES SALES.
So they did it again.
This time in houses.
You know what happened. You could have a mortgage to buy a house as long as you were breathing. No income, no job, no assets. They even gave the loan a name – “NINJA.” Bernanke knew this. He was the supervisor of the banks. He didn’t give a ****. He knew damn well this crap was being securitized and sold off to people and that there was no way, on a long-term basis, these loans could be paid off. These loans were given ONLY on the back of rising prices – nothing more.
Prices that had to rise 12% or more a year to cover a once-a-year flip costs – 6% for the buy, 6% for the sell, by the Realtards. Maybe you’re good and negotiate 1% off per side. Ok, the other 2% went to fees – fees that the banks got to keep, even if the paper was utter and complete CRAP.
Again, Bernanke didn’t give a ****.
Again, the bubble inflated. This time in houses. Bernanke claimed in sworn testimony as late as 2006 that there was no bubble and that housing prices reflected “strong fundamentals.”
Again the bubble popped. You know what happened. Millions of Americans lost their houses, millions lost jobs.
AGAIN, TRILLIONS IN WEALTH WERE VAPORIZED AND AGAIN THE BANKS KEPT ALL THE ILL-GOTTEN LOOT!
But this time, when the bubble popped, it popped a bit too early. The banks got stuck with some of their own crap. So Paulson and Bernanke went to Congress and threatened “Tanks in the streets” unless they got $700 billion. They rolled Congress to save their friends who not only should have gone bankrupt, many of them should have gone to prison!
But even that wasn’t enough. We still had a problem, and the market and economy was still falling apart. So Geithner and Bernanke, really the same guy with two faces, went to Congress again and got them to force FASB to make accounting fraud legal. That’s right – “make up a price for this asset and its ok on your balance sheet.” They did it, and heh, the banks were saved (well, not really, but it looks like it.)
So again nobody goes to prison, the same people steal all the money, and Bernanke claims – again – that he couldn’t see it coming – even though he was the guy supervising it all!
What’s worse is that all the crap that was shoved in the box – trillions of it – is still out there, much of it off balance sheet! Essentially every major bank has hundreds of billions of dollars of who-knows-what stashed where nobody can see or value it, exactly as ENRON did, and a couple of them have over one trillion in off-sheet exposure – more than enough to blow their capital to hell several times over if the valuations are not accurate. Yet we can’t see, we can’t examine, and we can’t know.
If I can see this without having a PhD from Princeton, either Bernanke is a ****ing idiot who bought his degree and has an IQ smaller than my kid’s soccer shoe size or he’s a damned liar and has been intentionally misleading the American Public along with Congress for more than a decade.
Ok, so there’s history. None of which Bernanke claims he could “see” with his much-vaunted “models”, remember?
What do you think the banks are doing now, having gotten away with all-but-murder (and maybe some of that too) with not one but two full sets of scams in the last decade?
Want to know the latest about Fannie Mae? You ain’t gonna believe it; they are back to sub-prime lending games.
Thought those great low down-payment deals were gone? Think again. If you’re willing to buy a home foreclosed by Fannie Mae through the new HomePath program, you may be able to purchase one with as little as 3 percent down. Even better, that 3 percent can be a gift from a family member or other third party, or a loan from a nonprofit, or a state or local government.
Sound a lot like those subprime loans that started this housing mess?
The terms are similar, but the big difference now is that to qualify for those favorable terms in the HomePath program, you must choose one of Fannie Mae’s foreclosed homes, and you must buy it “as is.”
Here are the terms you can expect:
Low down-payment and flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only).
You may qualify even if your credit is less than perfect, as low as 660, when most lenders want a minimum of 700.
You can qualify as an investor or owner-occupant.
Down payment must be at least 3 percent for an owner-occupant, but it must be funded by your own savings or by a gift, a grant or a loan from an employer, a nonprofit organization, or a state or local government. Investors must come up with 10 percent down.
No appraisal is required.
No mortgage insurance is required, but the terms of the loan may not be as favorable. You need to look at the options with your lender.
To get these very favorable terms, you’ll need to buy the home “as is.” But if you find the perfect home and it needs some renovation, you’ll be able to quality for the HomePath Renovation Mortgage. This type of mortgage will fund both the purchase of the home and some light renovation.
This was no oversight. Republican Senator Robert Corker and others proposed an amendment that would have added both a minimum down-payment requirement and consideration of credit history along with the establishment by regulators of a “prudent underwriting” standard. This amendment was defeated.
In early September 2010, Fannie and Freddie’s regulator, the Federal Housing Finance Agency, following requirements set out in 2008 by Congress, finalized affordable housing mandates that are likely to prove more risky than those that led to Fannie and Freddie’s taxpayer bailout. As required by Congress, these new goals almost exclusively relate to very low- and low- income borrowers. Meeting these goals will necessitate a return to dangerous minimal down-payment lending, along with other imprudent lending standards.
Since I’m in a particularly malevolent mood when it comes to politics today….
GMAC/Ally is owned by the US Federal Government. You, President Obama, indirectly through your Treasury Secretary Tim Geithner, took it over as part of GM. This happened on your watch and you cannot blame it on Bush.
We now appear to know that GMAC, along with other firms in the MBS marketplace, including Fannie and Freddie, have been using a series of “foreclosure mills” that are emitting tens of thousands of fraudulent affidavits that have been used to dispossess Americans of their homes. (See Tickers here, here and here.) There is plenty of question as to whether those foreclosures are proper or whether the original securitizations were valid in the first place.
Question #1: Mr. President, are you going to call a full-stop to all such foreclosures, reverse all that have occurred as a consequence of what appears to be massive and pervasive document fraud, and take personal responsibility for the mess in firms you took over as President of The United States?
Question #2: When will you be directing Eric Holder, your Attorney General, to investigate and file indictments against the officers, directors, and actors in these apparent foreclosure-mill scams?
Question #3: If it is proved that (1) the securitizations were not proper in the first place, and (2) not only were they improper but they were knowingly put together with either actual knowledge or reckless disregard for this fact, will you force the banks that were involved in constructing these intentionally-defective instruments to eat them?
Question #4: Yes, I know that if you do what is asked in Question #3 the banks will all blow up. Every one of them. There is some $1 trillion of this bogus non-agency MBS trash out there. I don’t care. Yes, I meant it when I asked if you would allow The American People some justice – just this once – from all the scams, frauds and schemes – even if it sinks your best friends on Wall Street!
That’ll do for starters.
Well folks, you get the idea; we are totally screwed and because the economy didn’t completely collapse, they are back to their old games with relish. Flipping this Congress and then this White House to CONSTITUTIONAL CONSERVATIVES will alleviate many of these problems.
Judge Andrew Napolitano is hosting Glenn’s ‘Crash Course’ Week as Glenn is on vacation. This week’s programs will be a recap of Beck programs that have outlined the history behind the events that have been occurring in our nation since the installation of Barack Obama.
Today’s program is all about the economy, Obamacare, the travesty of the Fin-Reg bill, cutting spending, unsustainable pension funds, and the insanity of bailing out GM. I only take issue with the movement of money in the buckets (you’ll understand when you see it), as all the money that GM collected in the first bailout should have been thrown on the floor or flushed down a toilet. Then GM should have refilled their bucket from TARP and then transferred that money to the Government Loan bucket. Glenn is correct though; the taxpayers’ bucket remains empty to this day.
Get ready for the snake-oil salesman to go all in as he prepares to make the voters swoon, cry, and wave their arms in the air yet again.
On the heels of another $1.5 Billion requested bailout from Fannie, (who has suffered 12 straight months of losses), we have the Obama political machine maneuvering to ‘buy’ votes in the upcoming midterms by offering mortgage forgiveness to Americans. How does that money-changing-hands-thang work again? Why don’t we just keep our money in the first place? I’m sorry, I forgot; I’m just some brain-dead, fluoridated, prescription-drugged and debt-strapped moo whose only reason for an IRS and Social Security tracked existence is to be out working to produce a revenue stream for the aristocrats and the rest of the world.
Main Street may be about to get its own gigantic bailout. Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages – one in five – are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help. The actual vehicle for the bailout could be the Bush-era Home Affordable Refinance Program, or HARP, a sister program to Obama’s loan modification effort. HARP was just extended through June 30, 2011.
The move, if it happens, would be a stunning political and economic bombshell less than 100 days before a midterm election in which Democrats are currently expected to suffer massive, if not historic losses. The key date to watch is August 17 when the Treasury Department holds a much-hyped meeting on the future of Fannie and Freddie. A few key points:
1) Republican leaders believe this is going to happen since GOPers and Democratic moderates in the Senate are unwilling to spend more taxpayer money on more stimulus. But such a housing plan would allow the White House to sidestep congressional objections and show voters it is doing something tangible about an economy that seems to be weakening.
2) Wall Street banks are alerting their clients privately to this possibility. Here is what some are cautiously saying publicly. This from Goldman Sachs:
GSE policies are one of a dwindling number of policy levers the administration has left to pull, so it is conceivable that changes could be made, though there is no sign that a policy change is imminent. The Treasury’s essentially unlimited ability to provide financial support to the GSEs creates an interesting situation over the next twelve months: the GSEs could potentially be used to provide additional support for the housing market and, to a lesser extent, the broader economy in 2H 2001.
And this from Mizuho Securities:
As policy makers ponder their next move the data suggests that they face not only a stalling recovery but a growing risk of deflation taking root in the economy. As a result, the Administration has turned back to industrial policies by approving the purchase of a sub-prime auto lender by GM as a means for pumping up domestic sales, especially since the latest auto sales data indicates that consumers are still responsive to incentives. This precedent increases the risk that the government will use its control of Fannie and Freddie to increase consumer cash flow and juice the economy again.
Moreover, Morgan Stanley is pushing a mortgage relief plan directly to Congress. On August 3, a top Morgan Stanley economist recommended to the Senate Budget Committee that Fannie and Freddie ease their lending standards to allow millions of Americans to refinance their mortgages.
3) Keep in mind the political and economic context. The nascent recovery is already running out of steam. Wall Street economists just downgraded the government’s second-quarter GDP estimate of 2.4 percent to around 1.7 percent. And as even Treasury Secretary Timothy Geithner is warning, the unemployment rate may well begin to rise back toward the politically toxic 10 percent level given such sluggish growth. Many in the White House thought the unemployment rate would be dropping sharply by this point in the recovery.
But that is not happening. What is happening is that the president’s approval ratings are continuing to erode, as are Democratic election polls. Democrats are in real danger of losing the House and almost losing the Senate. The mortgage Hail Mary would be a last-gasp effort to prevent this from happening and to save the Obama agenda. The political calculation is that the number of grateful Americans would be greater than those offended that they — and their children and their grandchildren — would be paying for someone else’s mortgage woes.
4) And don’t think the White House is worried about financial market reaction. If they thought it would pass Congress, they would be submitting a $200 billion Stimulus 2.0 (3.0?, 4.0?) right now.
August is supposed to be a slow month for Washington politics. But maybe not this one.
A few questions though.
Who will be making up the difference of the forgiveness loans?
Who will still be able to pay their mortgages without jobs, or with a dollar whose value is almost non-existent?
Who will still be able to pay their mortgages when their taxes increase in a few short months?
Who will still be able to pay their mortgages when hyper-inflation hits and food becomes more important than a roof over their childrens’ heads?
If this was such a viable option, why did Washington wait so long to do this?
Another short term heroin hit to make the Usurper Freeloader look like The Messiah and attempt to save his precious majority from the guillotine.
Whatever the fix, the money spent will not be recovered, said Alex Pollock, a former president of the Federal Home Loan Bank of Chicago who is now a fellow at the Washington-based American Enterprise Institute. “It doesn’t matter what you do or don’t do, Fannie and Freddie will cost a lot of money,” Pollock said. “The money is already lost. There’s an attempt to try to avert your eyes.”
Quoting Sen. Gregg, here is the herd of elephants in the room, (no mention of these two in the Dodd financial reform bill):
June 14 (Bloomberg) — The cost of fixing Fannie Mae and Freddie Mac, the mortgage companies that last year bought or guaranteed three-quarters of all U.S. home loans, will be at least $160 billion and could grow to as much as $1 trillion after the biggest bailout in American history.
Fannie and Freddie, now 80 percent owned by U.S. taxpayers, already have drawn $145 billion from an unlimited line of government credit granted to ensure that home buyers can get loans while the private housing-finance industry is moribund. That surpasses the amount spent on rescues of American International Group Inc., General Motors Co. or Citigroup Inc., which have begun repaying their debts.
“It is the mother of all bailouts,” said Edward Pinto, a former chief credit officer at Fannie Mae, who is now a consultant to the mortgage-finance industry.