Slashdot Mirror
$700 Billion Bailout Signed Into Law
Many readers reminded us of what no-one can have failed to hear: that the Congress passed and the President signed a $700B bailout bill in an attempt to avert the meltdown of the US economy. The bill allocates $700 billion to the Treasury Department for the purchase of so-called "toxic assets" that have been weighing down Wall Street balance sheets. This isn't particularly a tech story, though tech will be affected as will virtually all parts of the economy, and not just in the US. Among the $110B in so-called pork added to the bill to sway reluctant legislators are extensions of popular tax benefits for business R&D and alternative energy, relief for the growing pool of people subject to the alternative minimum tax, and a provision raising the FDIC's ceiling of guaranteed deposits to $250,000. Some limits were also imposed on executive compensation, though it's unclear whether they will be effective.
Why is it that really bad legislation always seems to pass on a Friday?
Go green: turn off your refrigerator.
Henry Paulson, the CEO of Goldman Sachs until 2006 and current U.S. Treasury Secretary succeeded in scaring the public and Congress into giving him a $700B blank check to bail out his friends. If you think that money will "trickle down" to you or small business owners, or anyone other than the people it's directly going to, you are mistaken.
...and our Congresspeople fell for it.
The DOW plummeted to 10,365 on Monday September 29th when the bailout bill failed to pass. Every proponent of the bailout screamed, "I told you so!" Then on Tuesday September 30th, even without the bailout bill the DOW rocketed up to 10,850. Then on Friday October 3rd when the bailout bill passed and was signed into law, the DOW dropped yet again to 10,325 (even lower than Monday when the bailout bill failed).
This bill will not help the credit markets, the debt markets, the equity markets or anyone reading this comment. It will help Goldman Sachs, Morgan Stanley and the rest of the former investment banks de-leverage from 60:1 leverage down to traditional 12:1 leverage on your dime while the economy goes down the tubes.
They pulled out all the steps - even threatening martial law:
http://www.youtube.com/watch?v=HaG9d_4zij8
I'm a big tall mofo.
I seem to remember reading the BBC and noting that countries overseas wanted this bill as much as some in the US.
Shai Schticks:"You don't make peace with friends, you make peace with enemies"
First, let's understand what caused this crisis. Then you'll understand why the bailout won't work.
Economist: Why Bankruptcy is better than bailout
The Trillion-Dollar Bank Shakedown That Bodes Ill for Cities ( written EIGHT YEARS before this crisis, predicting everything down to the dollar amount)
Now, check out the $150 Billion in pork-barrel projects that were added by the Senate to the original 100-page bailout that failed in the House, turning it into a 450-page bailout:
- "Wooden arrows designed for use by children" (Sec 503)
- Wool Research (Sec. 325)
- Film and Television Productions (Sec. 502)
- Litigants in the 1989 Exxon-Valdez oil spill (Sec. 504)
- Virgin Island and Puerto Rican Rum (Section 308)
- American Samoa (Sec. 309)
- Mine Rescue Teams (Sec. 310)
- Mine Safety Equipment (Sec. 311)
- Domestic Production Activities in Puerto Rico (Sec. 312)
- Indian Tribes (Sec. 314, 315)
- Railroads (Sec. 316)
- Auto Racing Tracks (317)
- District of Columbia (Sec. 322)
This is the bill that senators are screaming about, saying "IT MUST BE PASSED OR DOOMSDAY!" Who believes them? And yet the bill easily breezed through Congress.
Scumbags managed to lose lots of their money, now they can rejoice for they now can lose your money. If you are an american taxpayer, your participation means that you are down roughly $5k.
In theory there is no difference between theory and practice. In practice there is. - Yogi Berra
Only this lifeboat had no "women and children" in it. This was no lifeboat. It's a helicopter to rescue the captain after he ran the tanker into an iceberg.
What?
Did you even read a summary of the bill, or are you just handing on opinions?
I'm against the bailout bill, so I must be some kind of Anti-Bush partisan hack. Fooled you! I'm a registered Republican and made the mistake of voting for Bush once.
Oh, in that case I must be some kind of member of the unwashed masses voter and just don't understand fancy economic matters. Oops - fooled you again! I'm a Vice President at a fairly large publicly traded bank and deal with investment strategies all day every day.
As for reading the bill - I actually read the entire 3 pages of the original bill. I read about half of the pork-laden 442 page version that ultimately passed. I couldn't read much more or I might be even more infuriated than I am now.
Having said all this, I doubt you read even the title of the bill if you are seriously for it.
I'm a big tall mofo.
You need some serious perspective change.
Let me ask you this:
If you were to ask for, let's say a $10,000 loan with no plan on how to use it, would you expect to get the loan?
These people stated in no uncertain terms that they had no plan in dealing with the problem. The "problem" has been discussed and investigated for months... even years if you want to go back that far. "Experts" have been claiming everything is fine. And now these same "experts" want control of $700 billion and put the US tax payers on the hook for it. And they have NO PLAN on how to go about making things right and no plan on how to prevent it from happening again. NO PLAN.
Which should come first? The money or the plan?
The "panic" is unjustified. Banks have failed. We call that Darwinism. Let it be. Other institutions are restricting their lending practices... adding a little more sanity to their risk calculations. That is a good thing and what they should have been doing all this time! People seem to think this is a sign of the apocalypse. It's not. We should expect some trouble before things turn around again.
But if one thing can be clearly said about this is that these "experts" have caused this problem. These same "experts" claim they need $700 billion to fix it and they don't have a plan.
If this sounds eerily like the story of an addicted gambler, you'd be right to see it that way.
Dazzled ? Afraid ?
Fear not they just want everything you are worth.
History on Goldsmiths
http://news.goldseek.com/GoldSeek/1219039500.php
Article pointing out where the goldsmiths have struck again.
http://www.dailykos.com/story/2008/9/30/01617/5440/126/61517 7
Prepare to lose anything without inherent value. ie gold, food, water, bullets...
I have had the chance to speak with other business owners and some executives of, let's just say, large, corporations. The general feeling is that while action was necessary there was a much better approach:
- ~500 billion USD given to the Fed
- Allow the Fed to disperse the money through the discount window with loans at 1% fixed for 18 months then reset to Prime-0.5%
- All mortgages that are currently in MBS tranches have their rates reset to Prime+1 for 24 months.
- Have the US AG seek felony charges for lenders that committed fraud.
The current bill is like trying to get fuel into a car through the tailpipe instead of filling up the gas tank.
Website Hosting
Figure out how much the average driver burns per year. Give say $5000 in tax credits, and jack the price of gas up to compensate. Anyone who drives less makes a profit. Anyone who doesn't pay taxes (illegals, among others) pay more. Everyone wins.
Well, fiscal conservatism and liberalism are like any other kind of conservative/liberal dichotomy: simplistic.
You can be a fiscal conservative because you believe in balanced budgets. You can be a fiscal conservative because you believe in minimum spending. You can be fiscal conservative because you believe in minimizing government involvement in the economy, other than setting the money supply. You can even be a fiscal conservative who doesn't even believe the government should get involved with the money supply (like Ron Paul, who favors a return to the gold standard).
What's clear here is that most of the people talking about Wall Street being "greedy" don't have believable credentials to any kind of fiscal conservatism. There isn't really a name for them: they're socially conservative, politically authoritarian, and fiscally opportunistic. Mixing them up with "fiscal conservatives" is what makes what they say sound confusing.
Personally, I don't fit any of these definitions of "fiscal conservatism". I think that the budget should be balanced with respect to current expenses, but that capital items that either have real value (like buildings) or clear potential for increasing future revenues (like education and some road projects) can reasonably be funded by borrowing. I don't believe that accumulating debt in the taxpayer's name and giving him a break on this year's tax payment is a tax cut.
From my perspective, Wall Street is supposed to be greedy, and Washington is supposed to draw boundaries which limit greedy acts when they become anti-social. That makes me a liberal in many people's eyes, I guess, because I think the government is supposed to safeguard the common good. But there are plenty of paleoconservatives who agree with me on this, but weigh risks and benefits differently than I do.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
"If they did nothing and the economy completely crumbled leading to the Great Depression Part 2, you'd sure as hell feel it when you lost your job."
'Doing something' was the cause of the Great Depression; the government tried to prop up the economy rather than let the bad business go bankrupt and be bought up for a few cents on the dollar, and that was why it took so long to recover. Sure, they'd have had a recession if the government hadn't 'done something', but it wouldn't have been so bad and it would have been over much faster.
If anything is going to push the world into 'Great Depression 2: This Time It's Personal', it's governments 'doing something' with massive bailouts. But in a mass democracy the government have to show they're 'doing something', even if the 'something' they're 'doing' is actually making things worse.
Yep
I read it too.
If you're in banking, you must have noticed the fact that the increased cap of FDIC insurance from $100k to $250k will only apply until December of 2009, after which it reverts back to the limit of $100k per named account holder per financial institution.
How many people might get suckered into longer term CD's (Certificates of Deposits, not the ISO-9660 type) that might go over the boundary of the TEMPORARILY raised FDIC insurance caps and end up either inadequately covered or stuck with early-withdrawal fees?
Either way, NONE of the articles I have read make any statement about the fact that the so-called increase in the FDIC insurance from $100-thousand to $250-thousand is only going to last the length of calendar year 2009. That's a sham and a disgrace.
Kris
I have real doubts about the bailout "working". The underlying problems with the financial system are more fundamental. We have a sizable chunk of the financial system based on the assumption that real interest rates (after inflation) will remain negative.
Currently, US dollar inflation is around 5.4%. (9% to 11% if you use classical numbers, computed the way inflation was calculated prior to the 1980s.) Normally, the Fed funds rate is just above inflation, LIBOR and the prime rate run around 2% above inflation, and mortgages run about 6% above it. For the past year, the Fed has been flooding the financial system with cheap money, at 2%, in a failing attempt to avoid a recession. LIBOR is 3.88%. So we're currently in a situation where key real interest rates are well below inflation. LIBOR, in real terms, is about -1.5%. This is very unusual historically.
The problem is that 1) negative real interest rates can't last for long without producing runaway inflation; the money has to come from somewhere, and 2) there are sectors of the financial system that are addicted to those low, low rates. Last week, LIBOR briefly hit 6.88%, businesses were screaming "credit crunch", and AT&T and GE were having difficulties rolling over their commercial paper. (GE Credit borrowed short and lent long, which is a bet on low interest rates.)
The mortgage portion of the economy is heavily dependent on those low interest rates. A mortgage really should cost a good borrower about 11.5% right now; 6% as the cost of the mortgage, and 5.4% for inflation. The "bailout" is all about keeping those interest rates artificially low. For a while longer.
Probably not that much longer. Expect a "credit crunch" in 2009 as financial reality reasserts itself.
There's nothing wrong with a credit crunch. It just means that businesses have to finance more with equity and less with debt. (Because interest on debt is deductible by business borrowers, there's a systemic bias towards financing with debt.) Consumer credit rates, other than for autos, are already at credit-crunch levels. (Stop in at your local "payday loan" outlet and ask them what their APR is.) And besides, we might see worthwhile interest rates on savings accounts.
What's "normal?" 3% real interest on savings accounts, 6% on loans, and the median house costs 2.5 years median income. That multiplier got up to over 4 in the US nationally, and over 10 in some markets. That was two years ago; now those numbers are lower, but not low enough.
When bubbles burst, they burst all the way. Tokyo residential real estate dropped over 90% when their bubble burst in 1989, and never went that high again.
We told you this would happen. You didn't listen. Now suffer the consequences.
He said there were actually a number of alternate measures put forth, that would have solved the problem without the massive bailout price tag to taxpayers, but, that sadly none of them were even considered. Only the big bailout check bill was to be considered.
I wish I'd have time to get the details on the other proposals, but, no time at that time to talk further.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
What if the government starts to print lots of money to fund that stuff, creating a large invisible tax on everyone through inflation?
If I have nothing to hide, don't search me
It's starting to look more and more like all those ideals were just a relatively short-lived fluke as we barter away our true freedoms for freedom from responsibility.
Both the bill that was shot down and the bill that passed were disapproved by the majority of the citizenry. The People had no say so in the matter, the whole thing was rammed twice through the House in three days. If the House had shot it down again, the fucking bill with ever increasing pork and tax breaks would probably have been rammed three, four, five times in the course of the next week.
Why did the bill return to the House just after being rejected? And considering that the Fed quietly pumped around $600 billion into the casino known as Wall Street on Tuesday, even as the House was voting "nay" on the bill, are there any doubts that The People have absolutely no say so in the matter?
Lil' Thindime, lilting a lacrimose lament, krashes the kwaint konfines of Kokonino Kounty
One myth about the current financial crises is that it is the fault of ordinary Americans, who imprudently took out loans they could to afford. This is simply not true.
The current crises is not the fault of ordinary Americans.
It is true that many Americans took out loans they could not afford. I don't know why people did this - some, with credit cards maxed out on vacations, took out a home loans , and instead of paying off the credit card, took another vacation. Others were optimistic, egged on by the relentless propaganda that home ownership is good. Others were, perhaps , elderly and confused, or lost their jobs, or had medical bills. I don't know how many people acted in different ways, but i do know this: every single solitary mortgage had to be approved. Every single mortgage had to be approved by underwriters and bankers. Now, if someone, asks for a loan they cannot possibly pay, who bears more responsibility: the person asking, or the banker who approves it.
I further know that many ordinary Americans are suffering as a result of their actions, and of the actions of their neighbors.
Another myth about the current crisis is that rather then resulting from too little govt regulation, ti was the result of liberals messing with the free market, by forcing banks, with a law known as CRA, to make loans to poor or minority applicants. This question has been studied again and again by the Federal Reserve; suffice it to say, CRA loans were not the problem.
However, the question of who or why these loans were made is a red herring; it was not the approval of imprudent loans that has made the current crisis so severe. All the bankers who approved these loans are not actually the main culprits.
The people who bear direct responsibility for the current crises are people like Paulson; as CEO of Goldman Sachs, he and people like him are directly responsible for the current problems; that he is sending our tax dollars to his buddies to fix the problem is only icing on the cake of gall. Not only are people like pauslon responsible for our current problems, they acted from the basest of motives - greed. It was the desire on the part of people like Henry Paulson for larger paychecks that led to reckless behavior on the part of wall street; this reckless behavior generated large profits, justifying large salary's, but this same reckless behavior has gotten us to where we are today.
Another myth about the financial crisis is that it is incredibly complicate. While the technical details of loans may be complicated, the behavior and actions that led to this state are not at all complicated, and are similar to what we do every day.
As an example, this week, the wall street journal examined why AIG, one of the largest and most respected financial institutions in the world, suddenly collapsed. Turns out, they had a unit in london writing insurance; while it sounds complicated its just insurance - someone pays you some money, the premium, and you promise to pay back a lot more if they have a problem. And what did AIG do with the huge premiums they recieved ? they did not put any money aside for a reserve.
LET me repeat that: they spent all the money on salarys. So when the mortgage market went south, all of sudden people said, hey, AIG owes, in theory, a gazillion dollars of insurance, and they don't have any money set aside to pay it.
When people heard this, you had the famed loss of confidence, and AIG went bankrupt.
"When fascism comes to America it will come wrapped in the flag, and carrying a cross."
-- It Can't Happen Here by Sinclair Lewis, 1935
As Americans we have the freedom not to participate in our governments affairs. We have the freedom to consume from a vast array of versatile solutions for modern life. We have the freedom to waste our education and cling to superstitions and xenophobia. We have the freedom to believe we are the greatest country that has ever existed without knowing anything about the world around us.
We'd like to believe that people would choose to live up to a higher ideal, but we can't force them because that wouldn't be freedom. It's a sad truth that freedom and prosperity tend to lead to opulence and complacency. Once the ability to reason is reduced the person selling the easiest answers wins the prize instead of someone pointing out that things are going to be difficult.
The turning point for me was several days after 9-11, I was watching a baseball game which was preempted by the president. I was looking for some leadership, something the nation could get behind. It was the first time I heard him use the "evil-doers" rhetoric and he urged Americans to go shopping. That was our solution, the entire populous of our nation was useless to the president in a time of crises, except as feeder pigs suckling at the tits of the "free market" terrified of the heathen "evil-doers" that "hate us for our freedom."
With Russia rising back up from the ashes and China charging forward at a time the United States finds itself weakened, the Chinese proverb/curse, "may you live in interesting times" seems to be staring up at us from a melamine tainted fortune cookie.
--
I'm a glass half full kind of guy
I have paid zero in income tax through various legitimate and less-than-legitimate methods over the last 4 years. .
I'll remember that while my neighbors are trying to survive an upstate New York Winter on HEAP, Food Stamps, a Medicaid HMO and SSI.
Perhaps you and Joe Biden need to read something...
""Anyone may arrange his affairs so that his taxes shall be as low as
possible; he is not bound to choose that pattern which best pays the
treasury. There is not even a patriotic duty to increase one's taxes.
Over and over again the Courts have said that there is nothing sinister
in so arranging affairs as to keep taxes as low as possible. Everyone
does it, rich and poor alike and all do right, for nobody owes any
public duty to pay more than the law demands." " - Judge Learned Hand
Life is hard, and the world is cruel
Corporatists, born of fascists before them, believe crippling the state's treasury is the surest way to exercise total control. Looting the treasury is exactly what the B-C admin set out to do and achieved with unprecedented success. We have seen it in action shortly after 9/11, Katrina, Iraq you name it. Unfortunately the two party system has created polarization whereby true conservatives are damned if they concede the Ruplican Party has been hijacked by corporatists.
The problem with this is it drives up interest rates. A bunch. If I'm losing 12% a year due to inflation, and I want 3% interest for my risk and profit, I will not loan out money for less than 15%, as it's a losing proposition.
We are in defect spending right now, and cutting services is political suicide. Here's the options:
1) Continue deficit spending. Eventually, that compound interest catches up, and we default. At that point, the US can't get debt as easily, and spending is cut to meet income. What a novel concept.
2) Inflation. Do it too much, and it gets too expensive for us to borrow. If we can't borrow, we're in the same boat as #1. This is effectively a tax on people with money.
3) Cut spending. This is a good thing. Running a house with a vicious cycle of debt never works. Why would it work for a government?
4) Taxes. Lots and lots of taxes. This leads to tax evasion, businesses (and people) leaving the country, etc. Excessive taxation is horrible for business, and places an unnecessary burden on small businesses and the poor (no matter how "progressive" it is.)
Sadly, it looks like #4 is the way we're largely going to go. With all the liabilities we have, we're in for some real pain in the not-so-distant future. This will not work as they think, either.
Here's a quick example:
I run a software company. We are a US corporation, hiring US workers, with US taxes. All of our sales are done in-person, or over the internet. Corporate income tax can be avoided to a large extent through business expenses, leading to an effective tax rate not too much more than the income tax. Company pays employees, employees pay taxes, done. It works out to something like 40%, all said and done.
Now, suppose the tax climate gets really nasty. A company like mine doesn't have to be located in the United States - most of our customers aren't anyway.
So, it is possible to:
1) Set up shop in Panama (who doesn't tax corporations on income derived outside the country).
2) Move to another country (for example, Japan). Japan doesn't tax foreign-derived income for people who aren't "permanent residents". The US exempts the first $80,000. So, the first $80,000 are tax-free.
3) If you can live off $80,000 for a while, you can get paid in options. Provided you meet the criteria, this can end up capital gains. So, your taxes on this ends up at 15%.
So, for a hypothetical person making $150,000 - the taxes would be approx $10,500, or a 7% tax rate.
Large companies can do similar things, like "license" a bunch of technology from a company they own, located in a jurisdiction that doesn't tax them (like Ireland). This lets them reduce their taxable income and funnel the profits to something taxed at a much lower rate. Invest in Irish corp, license _from_ Irish corp, pay 15% taxes.
Yes, closing the capital gains "loophole" would even things out a bit; however, it has a lot of collateral damage; including people renouncing citizenship, reduced investment, etc. Given the credit crunch we're having, it really doesn't make a lot of sense.
Because the fucking bailout is a loan, not a giveaway. We (the government, and the people that actually understand economics) want a return on our investment. If we just gave that money to the people, it would be the equivalent of starting up the paper presses now and skyrocketing inflation to the point that zimbabwe would look good in comparison to us. And yes, I do expect this to happen within the next 4 years under Obama, and the introduction of a new currency will be done to fix it. Don't forget to buy a wheelbarrow to cart all that cash around.
---- Liquid was a patriot ----
One of the real concerns is, how successful would a Fascist state be if it carefully avoided scapegoating whole races or ethnicities? What happens if the government bends over backwards to avoid specifically profiling Muslems as terrorists, but still keeps people constantly worried about those unspecified but presumably swarthy terrorists still lurking out there in some not too carefully specified cells. Does Fascism have to simplify everything into racial or ethnic lines, or can it survive by creating more nuanced pools of enemies.
At this late date, most people have lost sight of the fact that the Nazis didn't really start putting Jews in the camps, in large numbers, until late 1941 or early 42. Before that, the camps programs had focused on minor criminals and mental defectives with the claim that they would be rehabilitated and not simply destroyed.
Smaller religious groups had already been classed as enemies of the state, i.e. most of the estimated 45,000 Seventh Day Adventists in Germany were rounded up or forced to leave for refusing to swear loyalty oaths before 41, but people didn't react to such numbers. A lot of Romany and Jews entered the programs at this time (with a lot being tens or hundreds of thousands respectively by 1941, not the millions later), but most of the Romany were the ones classed as petty criminals, and most of the Jews as Bolsheviks, Wobblies, or other political problems, not for their race, per se. It was after that time that they were reclassified as just part of the larger Jewish problem.
If something similar happened in America, it would probably involve (as just one example) a transition where the black population currently in prison for mostly drug offenses became just part of a larger 'Black problem', and was used to justify mass interments there. So long as the government can argue that they aren't targeting blacks, just treating crack cocaine as a special crisis that's worse than the other kind of cocaine sold to white neighborhoods, and similar claims, they can get the effect without appearing, to many, overtly racist at all.
Another possibility is to fictionalize and fractionalize problem groups in a way any opposition party would tolerate, and allow some opposition - i.e. a government saying "we have nothing against gays, just those bad, promiscuous gays who are spreading HIV by refusing to give up their promiscuity. We have to inter them, for public safety, but it's not like we are targeting all those other gays." Then the government doesn't accuse the political thorns in its side of being homosexuals, but of being secret members of the bad subtype of homosexual, when it rounds them up.
Or create a new term. Everyone's tired of the red scare era, and won't believe a government who sees commies under every bed, So call them "Unmutualists", like in The Prisoner TV show. Want to lock up those commies, or union organizers, or anyone who gets in the way of profits? Just insist that the way they sound, they are obviously secret unmutualists, using special code words that reveal their conspiracy, and not just typical protestors or unionizers or whatever. Change the new out group every few months, before a real oposition can get organized under that name, and you have a Fascism that can target problem individuals without ever having to pick on a natural group.
Who is John Cabal?
"Fascism should more properly be called corporatism, since it is the merger of state and corporate power"-- Mussolini
OK, if we are going to quote Mussolini as a great political scientist, let's extrapolate on this a bit. Who created Fannie Mae and Freddie Mac, the true "merger of state and corporate power" in this crisis? Democrats. Who further extended this by creating the CRA? Democrats. Who expanded its mission into accusing bankers of racism ("redlining") and extorting them to make more bad loans, or else be investigated? Democrats. Who ignored warnings and blocked efforts at reform in 2003? Who killed efforts at GOP reform of the FMs in 2005? Democrats. What party was Chris Dodd, Chairman of the Senate Banking Committee who took millions in lobbying money from the financial services industry and got sweetheart loan deals a member of? Democrats. What party was the guy who was boning the assistant director of Fannie Mae while he was on the House Financial Services Committee a member of? Democrats.
Funny, I see a lot of suspects that your oh-so-insightful post left out.
But don't worry. help is on the way. Barack Obama, who also got a sweetheart loan deal, will be sure critics can't speak out against him. He will define truth, just as Orwell predicted, since the media is asleep at the switch. What party is he from?
Whoever modded parent as "insightful" are all so busy slamming Fox News that you don't even know who is responsible for all of this. But don't let the truth get in the way of a good story.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
"How, exactly, is my ideology tied to George W Bush's?"
Any time I've seen your idiotic use of labels, "those damn liberals", it's always a Republican or someone co-opting the word "conservative" to support their own big government pet programs. Are you for the abolition of the Federal Reserve, Fannie Mae, Freddy Mac, the Department of Education, making abortion legal, getting the church out of the state, reducing the role of the government down to its only proper role: to uphold and protect the rights of the citizenry, and that's it ? Are you for all this? That is a conservative. Subscribe to anything else, even a mixed system, and you're merely resorting to principles when it is convenient, and violating/disregarding those principles when it is not convenient - pragmatism, in short. Moral and political pragmatism.
"And how is linking to the LA Times and Wikipedia and the Wall Street Journal "sticking to Fox News Bullet points"?
Any time I see someone label someone else a Liberal or a Conservative, without having a clue about their political stance (in this case, you got me as completely wrong as possible), it's because that individual is a braindead Dem or Rep spewing talking points.
"random story about how Bush is not Reagan."
What does that mean? Reagan was just as big of a joke as Bush. They're both for big government, while paying lip service to capitalism and freedom when it is convenient and politically profitable. When you learn to stop fooling for this idiocy, you'll understand what it means to have inalienable rights.
Did you know, that in Civilization 2 (in my eyes, the best of the series), fascism and fundamentalism were the two most successful forms of government?
Successful in conquering the world.
Go figure...
Any sufficiently advanced intelligence is indistinguishable from stupidity.
You realize, of course, that you've left a lot out?
You realize, of course, that the CRA did not force banks to make loans to individuals who couldn't afford them? What it did do was say that you could not refuse credit based on location or area (redlining) and instead had to base your loan evaluation on the INDIVIDUAL, and upon the individual's ability to pay. (Try reading the bill and not the Wiki.)
You realize, of course, that the vast majority of the subprime loans that are going belly-up were made by financial institutions like CountryWide... which are not banks, and as such, WERE NOT COVERED BY THE CRA IN THE FIRST PLACE.
You realize, of course, that in early 2005, the Office of Thrift Supervision (under GW Bush) implemented new rules that substantially weakened the CRA, and as such, its impact on credit markets?
You realize, of course, that a good portion of our current crisis is caused by the Gramm-Leach-Bliley Act, introduced by Senator Phil Gramm (R-TX), which in 1999 repealed part of the Glass-Steagall Act, opening up "competition" among banks, securities companies and insurance companies. Which in turn lead to our current set of mega-institutions that are so large and intertwined they can't be allowed to fail?
The same Phil Gramm, BTW, that was John McCain's presidential campaign co-chair and his most senior economic adviser. The same Gramm that in July explained the nation was not in a recession, stating, "We have sort of become a nation of whiners."
I could continue, but suffice to say that there's a lot of information that your oh-so-insightful post left out.
Do you work for the Republican campaign? I only ask because such blatant cherry-picking of the facts to suit your own position is a party trademark.
Any sect, cult, or religion will legislate its creed into law if it acquires the political power to do so.
You really should do some digging on what the Canadian banks have done (or, more precisely, what the government has allowed them to do). It's been covered up by the MSM quite well and the lie that "we're different, we're better" is propagated until they're blue in the face.
0% down, 40 year mortgages where people are immediately underwater on their "investment". People buying two, three, TEN investment properties. Self employed people being granted ridiculous amounts of money that have no correlation to their real income because it's a negotiable "wink wink" sorta thing. Just look at Vancouver, BC where it's $900k for a fucking shack. The median family income there is like $65k and these places are still selling. In what financial fairy tale is that even remotely plausible? There is NO way that responsible lending would allow something like this, yet there it is.
The difference with our banks is that they're off-the-hook from the get-go. CMHC has already guaranteed the loan and if it goes into default, CMHC/taxpayer is out the money, not the bank.
When everything real-estate comes crashing down, the truth will come out and we'll find out who the liars were. But as always, too little, too late.
Reposted: originally by Greyfox:
Early on in this administration they changed the bankruptcy rules to make it harder to declare bankruptcy, stating that individual Americans need to be more responsible with their borrowing. At the same time they've driven this country into historic levels of debt and are now debating a bail out package for their friends on wall street with $700+ billion of taxpayer dollars. Time and again they vote to support their friends in big business, but if you're an individual facing possible homelessness they'll treat you to some weasel words and turn their back on you.
This November we should all vote with one voice, Democrat and Republican, against the current corrupt congress. We should vote across the board, not Democrat or Republican but against anyone sitting in office. We should kick every single one of those bastards out, and we should keep kicking them out after just one term until they once more represent the people and not the businesses that contribute millions of dollars a year to their campaign funds. We should keep kicking them out until they spend more time doing the jobs we elected them to do instead of gallivanting around and campaigning for most of their terms. We should keep kicking them out until we find some people who actually take the responsibility to fix the major problems in thus country.
It is time to put aside our petty differences and root out this corruption that infects our very core, before it destroys this country.
I know at least 20 people including myself that are planning to do just this. I wonder how many others are going to vote against the incumbent?
There is a war going on for your mind.
Nope. Like the national debt, it will simply be rolled over into bigger loans.
The idea that credit is not inflationary is laughable... It is ONLY non inflationary if you actually allow the bubble to deflate. If you allow the debt to consume the credit... The WHOLE point of this loan is to prevent precisely that happening...
New debt IS starting up the printing presses, but without all the hassle of paper and ink. Go take a look at exactly how the CPI figures are calculated for a good laugh about the true nature of capitalism and economic growth .
Americans are going to need an extra zero or two on their salaries in the coming years... But hey, look at the bright side, everyone gets to be a milionaire.
Deleted