Within hours of the House passage, Bush had the more than $700 billion “rescue” bill signed sealed and delivered into the law books.
President Bush says the legislation is meant to keep the Wall Street crises from widening… tho you wouldn’t believe that if you watched the numbers tumble following the bill’s passage. All of which, of course, everyone blamed on the new unemployment numbers.
Nonfarm payroll employment declined by 159,000 in September, and the unemployment rate held at 6.1 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Employment continued to fall in construction, manufacturing, and retail trade, while mining and health care continued to add jobs.~~~
The unemployment rates for adult men (6.1 percent) and blacks (11.4 percent) rose in September. The jobless rates for teenagers (19.1 percent), whites (5.4 percent), and Hispanics (7.8 percent) were essentially unchanged. The unemployment rate for adult women declined to 4.9 percent, partly offsetting an increase in August. The unemployment rate for Asians in September was 3.8 percent, not seasonally adjusted.
I happened to catch a part of the hearing where they said the industries most hit were construction, retail and some financing/real estate industries… all entirely logical with the housing slowdown.
Fat load of good it’s doing so far, right?
Of course, both Obama and McCain had to weigh in on the job numbers.
Obama: Today, Americans woke up to the sad news that 159,000 jobs were lost last month alone, making September the ninth straight month of job loss. With three-quarters of a million jobs lost this year, and millions of families struggling to pay the bills and stay in their homes, this country can’t afford Senator McCain’s plan to give America four more years of the same policies that have devastated our middle-class and our economy for the last eight. Instead of Senator McCain’s plan to give tax breaks to CEOs and companies that ship jobs overseas, I will rebuild the middle-class and create millions of new jobs by investing in infrastructure and renewable energy that will reduce our dependence on oil from the Middle East. I also call on Congress to pass an immediate rescue plan for our middle-class that will provide tax relief, save one million jobs, and save our local communities from harmful budget cuts and painful tax increases.
McCain: Today’s report of another 159,000 lost jobs confirms what America’s working men and women have understood for months: our nation’s economy is on the wrong track. It is imperative that Congress act to address the financial crisis while protecting taxpayers and being good stewards of their dollars. But we must do more.
America’s middle class needs help from a government that is truly standing on their side and not in their way. I am committed to getting to the roots of this crisis — reforming Washington and cleaning up the mess created by the greed and crony capitalism of government-backed mortgage giants — Fannie Mae and Freddie Mac. I will reverse out-of-control spending, end the wasteful and corrupting practice of earmarks, and get the government budget back to balance. I will reform health care to control costs and better serve American families, open markets around the globe for our products, cut taxes, and expand domestic production of energy to eliminate the ability of international oil markets to hold our economy hostage. I will create jobs and get the economy on the right track.
Unlike Senator Obama, I do not believe we will create one single American job by increasing taxes, going on a massive spending binge, and closing off markets. Our nation cannot afford Senator Obama’s higher taxes.
Tons of happy DNC Congress types today, tho… all posing and grinning like ghouls. Pelosi and her ecstatic progressive pals? Very quick to promise more of the same socio-economic changes for the future.
Following the passage of the economic bailout bill Friday, House Speaker Nancy Pelosi said congressional hearings are planned to find the causes of the crisis and to determine “where we go from here.”
“We were dealt a bad hand; we made the most of it,” Speaker of the House Nancy Pelosi said Friday.
She said Congress will shine a new “light of scrutiny and accountability” on the nation’s financial system to try to prevent a replay of the problems that plunged the nation into an financial crisis.
Reps. Barney Frank, D-Massachusetts, and Henry Waxman, D-California, plan to hold hearings to increase scrutiny of the financial system, Pelosi added.
“We want to take our country in a new direction for the middle class,” Pelosi said.
Frank told reporters Friday that starting in January, Congress will “have a major role.”
“We have to rewrite housing in America. … It would be highly irresponsible if we were to stop here,” he said. “Now we have to perform more serious reform.”
Does anyone else besides me get that queasy feeling in their stomach hearing this?
According to MarketWatch, nervous analysts – pacing the halls like expectant fathers – are quite frankly worried if this particular economic baby will even grow up to be a success….. now don’t that make you feel better?
The plan engineered by Treasury Secretary Henry Paulson calls for the government to buy so-called “toxic” mortgages and other securities from banks for more than their current distressed-market values but less than the government hopes they’ll be worth someday.
The idea is to give banks and their counterparties confidence that they are on solid footing so they can lend their surplus capital to each other and to the public.~~~
But many experts wish Paulson had devised a plan along the lines of billionaire Warren Buffett’s investment in Goldman Sachs Group, accepting preferred stock and affording him the ability to profit on the upside in return for capital.
“An intervention based on preferred-stock injections into banks would be preferable to the Fed-Treasury TARP proposal of government purchases of bank assets,” said Charles Calomiris, a professor at Columbia University Business School. TARP stands for Troubled Asset Relief Program.
Some observers are genuinely upset at the thrust of Paulson’s program.
Desmond Lachman, analyst at the conservative American Enterprise Institute, called it a “stupid plan” and said Paulson should have directly injected capital into banks instead. At a minimum, he said, the plan should have been targeted to banks in dire need of capital.
Others won’t go as far as Lachman in their criticism.
For them, a strong point of the program is that Paulson has sweeping power and tools at his disposal to craft the plan. Accordingly, Paulson will be able to adapt it based on experience.
Yeah yeah… but we already know that Congress refused to look at any other solution but a government buyout. And between their fear of God, and the abject failure of the media to provide ample alternative solutions via their communication lines, a nation – adamantly against this – was railroaded anyway… ignored by our elected officials, and passed off as too stupid to know any better.
But as these experts are openly admitting, this new spendy law is no panacea for the economic fix. And all agree that the next POTUS is going to have to spend even more money to put a “floor under the housing market.”
On other fronts, CitiBank’s whining that Wells Fargo slid in under the wire, and sealed a deal for Wachovia for $15.1 billion complete takover… making their Citi’s partial takeover of the banking operations only for $2.1 bill (and brokered by the FDIC) seem pale by comparison. Mostly which shows me that if government stays out of it, banks seem more than perfectly able to broker their own deals… and better ones at that.
And of course, Citi is not being a gracious loser, saying they had “exclusivity”, and are now threatening a lawsuit. That’ll help a bunch, eh? Wall Street behaving badly… could be a new reality show.
But this is only the beginning. The government has ignored the opinions of “we, the people” and interfered “for our own good”. There’s no going back now. And if Pelosi and gang’s promises for further government intervention aren’t giving you the willies yet, there’s more to make you afraid… be *very* afraid. The government welfare line has started to form already – all with their proverbial hands out.
The latest (and certainly not to be the last) in line would be the Governator, Arnold Schwarzenegger, calling the newly rich moneybags, Henry Paulson, peddling California’s bad debt for the steal of a deal price of $7 billion.
California Gov. Arnold Schwarzenegger has told U.S. Treasury Secretary Henry Paulson that the most populous U.S. state may need the federal government to buy $7 billion of debt the state is unable to sell due to weak credit markets- and that California may not be alone.
The $7 billion issue of revenue anticipation notes would raise cash to tide California over the near term until it gets expected revenues, but the plan to sell the debt is in peril because the municipal debt market is frozen, State Treasurer Bill Lockyer said earlier this week.
“This is not a normal year,” said Lockyer spokesman Tom Dresslar on Friday, adding that the state was preparing the issue but that markets were in turmoil: “The paralysis lingers.”~~~
Lockyer, a Democrat, and Schwarzenegger, a Republican, have warned that California may have to delay payments for essential state services such as law enforcement, and in his letter to Paulson the celebrity governor said his state is not alone.
“Absent a clear resolution to this financial crisis that restores confidence and liquidity to the credit markets, California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the Federal Treasury for short-term financing,” Schwarzenegger said in a letter to Paulson dated October 2 and provided to Reuters on Friday.
Uh… you listening to this, Curt?
Which brings us full circle to those nervous nellies who were pacing the halls of Congress I mentioned earlier…
Apparently they should have been more in fear of it’s passage than failure, considering the most immediate fallout in just the hours since passage. They warned Paulson’s program could be opening the door to faciliting industry consolidiation. The banks would offload their assets to the government, the smaller banks won’t be able to survive, and will be consumed by the stronger, larger survivors.
And they warned of more California’s as well…
And even as many more financial firms are bound to fail, state and local governments find themselves in perilous financial shape, said Roger Kubarych, economist at Unicredit Global Research.
“We’re going to have further failures — not just in the banking area but in other types of financial institutions, finance companies and insurance companies can’t all make it,” said Kubarych in a television interview.
And on the municipal side of things, the prospect that Jefferson County, Ala., may go into default could be just the tip of the iceberg, Kubarych said.
Jefferson County, which includes Birmingham, would be the biggest municipality to go bankrupt since Orange County, Calif., in 1994. “They are not they only state and local authority having problem paying their debt, ” Kubarych said, adding: “You can’t get foreign money into municipal bonds.”
But all their alternative suggestions and warnings fell on Congressional deaf ears. And worse yet, a narrow focused Paulson… the lone recipient of all these funds and power… never had a Plan “B”!
Nice going, Congress… you’ve really opened Pandora’s box now. The elected elite are not only responsible for this mess… and lying about it daily to us to boot …. but now they’ve really proven they are not to be trusted with the taxpayers hard earned bucks. And our POTUS appointed Fed Secy’… confirmed by Congress? I don’t know what to say… I dare say he may go down as the worst Bush appointee in both his terms.
Perhaps the most insulting to “we, the people” is having them look right into our eyes and promise us all these overpriced bad notes they bought will make a profit in the future. Not only is that doubtful, but if it does, don’t expect any profit sharing checks from a permanent fund to us… the taxpayer/bank. Nope… they say it will pay down the debt… unless, of course, a new sitting POTUS eyes it for another “needed” pet project.
What a deal…
Congress? Do us a favor next time… don’t help. Because all I can say is, with a “rescue” like this, I think I’d prefer treading water for a long time instead.