I thought I’d have some fun with the DNC Rabid Attack Ad:

Amazing that the DNC believes their ad to be a winning strategy: Let’s characterize and flippantly dismiss concerned Americans on both sides of the political aisle as nothing more than torches-and-pitchforks-style rabble-rousers. Brilliant.

Thanks to skye for use of her photos and apologizes to Dana Loesch for pillaging her photos like the uncouth, ill-mannered mobster, that I am.

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For a generation, now, we have been accommodated with a front row seat to a rigorous and seemingly intractable advance of government into the whole of America’s social fabric, and into the institutions of its capitalist system. Today we are confronted with a wave of negative wind pushing against the capitalism that has brought America its unprecedented success, as it absorbs the blame for the economic meltdown.

I am not equating capitalism with free markets here as is too often done, because that would imply an inclusion of international communities into a common basket, and there has to be balance and common sense in the application of “free trade,” between participants as we have discussed in previous articles.

Recessions inevitably deliver capitalism a bad rap. Making matters worse, there are usually groups or individuals who have taken advantage of power and influence, or who hustle the provenance of panicked confusion into magnified opportunities for fortune creation. All the while, wide swaths of society are struggling to meet basic needs. Visible abuse of the system that leads to wealth concentration provides thresholds over which those so inclined will leap to promote expansion of government and its insinuation into the corporate fiber of the Nation. Such intrusions usually come from those with little grasp of the elements at the heart of economic growth, human nature, creativity and the human spirit. On the other hand, extravagant, unrestrained, and unconscious excess fosters jealousy, and reaction. It can also propel overreaction, which in turn empowers those in government who seek increases in government intervention at all levels of commerce.

Such exercises in reactive belligerence pretending concern for the public “good,” are actually acts of self-interest intoxicated by ideology, or worse, driven by overwhelming ego. The reactive process ignores long term consequences of hysterically applied policies, and absolutely cannot effectively evaluate the secondary or tertiary repercussions. Read the rest of this entry »

There’s no doubt about it… as the St. Pete Times PolitiFact says, Obama’s promise to create a foreclosure prevention fund to the tune of $75 billion minimal, with the Making Homes Affordable Program is in the “promises kept” column.

What the PolitiFact tracking system doesn’t discuss if it spending the taxpayers money has any any effect on the foreclosure trend. And the fact it, reality dictates it not only hasn’t prevented… or even slowed… foreclosures, but they’ve been on the rise since the O’Inaugural festivities…. despite still relatively low interest rates.

Well… congratulations, Obama. You kept your promise, put us further in debt, and time has proven this is not working, nor is likely to work in the predictable future. Allow me to ’splain…

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Our favorite Congressman from MA is back in the news again.

No, there’s not a male escort service operating out of his townhouse this time. That’s so 1989.

This time, Barney is pushing for, you guessed it, relaxed mortgage standards.

Since that worked out so well for our country the first time, Barney wants an encore:

Rep. Barney Frank says that unless Fannie Mae and Freddie Mac relax their recent tightening of mortgage standards on new condominiums, the economic recovery could be threatened.

That would be the same Barney Frank who famously boasted that the two federal agencies — which lost billions by making improvident loans — were “fundamentally sound financially and [can] withstand . . . disaster scenarios.”

Then came the disasters.

But to Barney Frank, Fannie and Freddie are essentially taxpayer-funded social-service agencies whose mission is to turn all Americans into homeowners — whether or not they can afford it.

Fannie and Freddie recently announced that they would no longer guarantee mortgages on condos where fewer than 70% of the units have been sold; the previous threshold was 51%.

The agencies also said they’d no longer guarantee mortgages in buildings where 15% or more of the owners are behind in their condo dues or where more than 10% of the units are held by a single owner.

And they’ve raised fees on buyers whose down payment is less than the standard 25%.

The tightened standards are intended to limit the exposure of the two agencies — which purchase or guarantee most US mortgages — in buildings with potential financial problems.

Obviously, this means that some condo owners may find it more difficult to sell their units — because buyers will find it more difficult to get mortgages.

Enter Barney Frank — backed by New York’s own Rep. Anthony Weiner, who aspires someday to be mayor.

…snip…

Here we go again.

Frank, it should be noted, declared last fall that “we’ll have to raise taxes, ultimately” to pay for all the increased government benefits he’s also demanded in order to alleviate the crisis his bad advice helped create.

To say that Barney Frank has a bad track record here is putting it mildly.

Problem is, he’s also chairman of the House Financial Services Committee, so his “suggestions” have political muscle behind them.

But following Barney Frank’s advice is a prescription for disaster.

Some people never learn.

The Congressman, and the voters, of MA are prime examples.

Honestly, you’ve gotta love the man’s political huevos! He stood right there, right in front of America’s most sacred documents, and lied to the American people.

Now, over the last several weeks, we have seen a return of the politicization of these issues that have characterized the last several years. I understand that these problems arouse passions and concerns. They should. We are confronting some of the most complicated questions that a democracy can face. But I have no interest in spending our time re-litigating the policies of the last eight years. I want to solve these problems, and I want to solve them together as Americans.

Gee, so…why’d President Obama hold his speech today, at that hour? Because he knew that Vice President Cheney was going to defend his name, his honor, his legacy, and his innocence, and he wanted to pre-emptively attack those same things. He wanted to divide and distract the nation on a day when awful economic numbers came out (higher unemployment, higher unemployment rate, longer unemployment expected, unemployment expected to rise, new home sales down, existing home sales down, GDP lower than expected, stimulus doing nothing, and….my favorite, number of homeowner families helped by Obama/Dem homeowner rescue package over past 5months:1 per CNN).

Somehow, I’m skeptical of calls for unity that come in a political attack speech. Call me crazy.

This video of Howard Dean depicts the classic Socialist, and he doesn’t hide it. In fact, at the end of the video he says:

“We’ve had quite enough capitalism the last eight years. I think we need some regulation now.”

Politic’s Daily has some more quotes from this interview:

Former Democratic National Committee Chairman Howard Dean was on CNBC today debating the likely impact of President Barack Obama’s economic policies and the $17 billion in cuts that the president has included in his $3.5 trillion budget. In the course of defending Obama’s policies, Dean made some statements that the Administration may come to regret.

Dean first said that there would have to be tax increases, which he called “revenue increases,” to pay for President Obama’s spending priorities (1:40). Dean followed that up by endorsing a “carbon tax,” (1:45) referring to a cap-and-trade pollution emissions system that the Administration and Democrats in Congress have shelved because, in the president’s own words, the plan would cause electricity rates to skyrocket. Finally, Dean asserted that President Obama’s economic policies are good for the country because, “[W]e’ve had quite enough capitalism the last eight years. I think we need some regulation now.” (5:00)

Video below:
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What could have been on his mind? 41 year old, David Kellerman, was found hanging in the basement of his Vienna, VA home early this AM. Police responded to a 4:45AM 911 phone call, but declined to say who had placed that call.

Kellermann, 41, and a 16-year veteran of Freddie Mac, had been the company’s CFO since September, after a government takeover of the company following the housing crisis. County records show the large home in Hunter Mill Estates was worth about $900,000.

~~~

Kellermann was named acting chief financial officer in September 2008, after the resignation of Anthony “Buddy” Piszel, who stepped down when the government took over.

According to securities reports filed in March, Kellermman was to receive an $850,000 bonus.

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Yup, here we have it again, another reasonably clear exposition of what the Obama admin is doing wrong.

The Obama administration’s bank- rescue efforts will probably fail because the programs have been designed to help Wall Street rather than create a viable financial system, Nobel Prize-winning economist Joseph Stiglitz said.

“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”

The Troubled Asset Relief Program, or TARP, isn’t large enough to recapitalize the banking system, and the administration hasn’t been direct in addressing that shortfall, he said. Stiglitz said there are conflicts of interest at the White House because some of Obama’s advisers have close ties to Wall Street.

“We don’t have enough money, they don’t want to go back to Congress, and they don’t want to do it in an open way and they don’t want to get control” of the banks, a set of constraints that will guarantee failure, Stiglitz said.

The return to taxpayers from the TARP is as low as 25 cents on the dollar, he said. “The bank restructuring has been an absolute mess.”

~~~

The Public-Private Investment Program, PPIP, designed to buy bad assets from banks, “is a really bad program,” Stiglitz said. It won’t accomplish the administration’s goal of establishing a price for illiquid assets clogging banks’ balance sheets, and instead will enrich investors while sticking taxpayers with huge losses. Read the rest of this entry »

The U.S. government and the Federal Reserve have spent, lent or committed $12.8 trillion, an amount that approaches the value of everything produced in the country last year, to stem the longest recession since the 1930s.

New pledges from the Fed, the Treasury Department and the Federal Deposit Insurance Corp. include $1 trillion for the Public-Private Investment Program, designed to help investors buy distressed loans and other assets from U.S. banks. The money works out to $42,105 for every man, woman and child in the U.S. and 14 times the $899.8 billion of currency in circulation. The nation’s gross domestic product was $14.2 trillion in 2008.

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To add to Mata’s post yesterday Openmarket.com… has a good description of Obama’s recipe for disaster.

Toxic Asset Rip-Off

That’s how analysts describe the trillion-dollar toxic-asset buy-up program proposed this weekend by the Obama Administration: “the president is putting forth his idea to have the Treasury become the new AIG. In order to get hedge funds to buy up toxic debt, Obama is proposing that the Treasury provide loans up front and insurance against potential losses on the back end. It’s what Paul Krugman called ‘heads I win, tails the taxpayers lose.’ By the way, it may cost another $1 trillion.”

The Treasury Secretary claims taxpayers won’t lose a full trillion, because the assets aren’t as worthless as their current market prices suggest. But if that’s true, why does he continue to insist on federal accounting rules that force banks to value their assets at the current depressed market prices? Either the accounting rules are right — in which case taxpayers will end up losing a trillion dollars — or they are wrong, amplifying financial panics — in which case the rules should be repealed, so that banks, not taxpayers, will be able to take the risk of holding the assets. (If these accounting rules, known as “mark-to-market” accounting, had been in place in the late 1980s, “every major commercial bank would have collapsed,” wiping out the economy).

The above is the cost of getting the government involved in issues the private sector should handle. Of course letting the private sector handle this is how a politician who believed in Capitalism would lead.

Meanwhile Obama’s former nominee for Commerce Secretary, Sen. Judd Gregg, just admonished Obama over his budget proposal:

This translates to a debt-to-GDP ratio that we have not seen in this country since the end of World War II, when we were trying to pay off war debt,” he said. “If you take all of the presidents from George Washington to George Bush, and add up all of the debt they put on the books of the American people, President Obama’s plan adds more debt than that.”

Sen. Mitch McConnell, standing with Gregg, warned Democrats against passing the budget along party lines and using budget reconciliation to pass sweeping new programs. “If you do it with no bipartisan buy-in at all, then you own the whole thing.”

Oh, they own it….all of it.

No one reports this better thanHot Air

CNN:

Senate Banking committee Chairman Christopher Dodd told CNN’s Dana Bash and Wolf Blitzer Wednesday that he was responsible for adding the bonus loophole into the stimulus package that permitted AIG and other companies that received bailout funds to pay bonuses.

On Tuesday, Dodd denied to CNN that he had anything to do with the adding of that provision.

…but the video is priceless (look how red his face is).

Also, note that he says he did the discreet removal-not because he’s the largest campaign recipient of money from AIG (noooooooo), but because Obama’s Treasury Dept urged him to do it. That’s the same Treasury Dept that claims they were shocked and surprised, and the same Administration that says it was shocked and surprised…all while we’re supposed to ignore that they knew about the Bonuses months ago. Apparently, not only did the Obama Admin KNOW about the bonuses, but they went out of their way to covertly get them allowed!

Even after most acknowledge (most meaning those with some common sense) that the CRA was one major component of our financial meltdown we still get examples of our government cracking down on those banks who didn’t buy into the CRA baloney and actually STILL make a profit because of that stance:

…here comes this fantastic story, courtesy of the Boston Business Journal, about East Bridgewater Savings in Boston:

Bad or delinquent loans? Zero. Foreclosures? None. Money set aside in 2008 for anticipated loan losses? Nothing. … The bank even squeaked out a profit of $87,000. And its Tier 1 risk-based capital ratio was 31.6 percent, or more than three times higher than many community banks in Massachusetts. “We’re paranoid about credit quality,” Petrucelli said. The 62-year-old chief executive has run the bank since 1992.

Yet the FDIC has turned up the heat on Petrucelli’s bank, giving it an apparently rare “needs to improve rating,” for not making more risky loans under the Community Reinvestment Act. Here is how the FDIC puts it: “There are no apparent financial or legal impediments that would limit the bank’s ability to help meet the credit needs of its assessment area. The FDIC examiners also faulted East Bridgewater “for not advertising and marketing its loan products enough. The bank, which does not have a Web site, offers fixed-rate mortgages.”

“Paranoid about credit quality.”

If more of financial institutions had felt the same way, or were not so heavily penalized because they did run their business the same way, we would not be in hole we are in. Sure, we may still have been in a hole because there were plenty of other factors involved, or as Mataharley termed it….“The Perfect Storm”….but that hole is deeper then it ever should of been because of the CRA.

Compromise and change right? Read about this latest display of arrogance: (h/t Jonah Goldberg)

This weekend, I spoke on free trade at the Club for Growth’s annual meeting in Palm Beach this weekend. At dinner last night, I heard an amazing story from Steve King, a Republican congressman from Iowa. I was amazed at two levels: (1) the story itself and (2) the fact that he was not amazed.

King is a member of the House Judiciary Committee. Recently, the Committee has been meeting about the “cram down” bill, a proposed law that would give the power to judges in bankruptcy meetings to alter the terms of people’s mortgages. King, realizing that the bill is likely to pass, was trying to minimize the harm it would do. So he offered an amendment that would prevent anyone from taking advantage of this special deal if he/she had engaged in any material misrepresentation during the original mortgage process. His amendment passed by a vote of 21-3.

But later the staff of the Committee, who report to Chairman John Conyers, altered the amendment, after it had been voted on, to state that no one could take advantage of the special deal if he/she had been convicted of fraud. Of course, there’s a huge difference. What they voted for is very different from the language that the staffers substituted without the permission of those who voted.

I was shocked. I asked King if there was anything he could do about this dishonest behavior on the part of Conyers’s staffers. He said that there wasn’t.

A reader to the above blog questioned how this could be possible, everything on the thomas.loc.gov… site shows the exact markups King described, no other changes. Read the rest of this entry »