Somebody finally confronted Congressional liar and all-around misfit Barney Frank. Here's the video clip of Fox News' Bill O'Reilly daring Frank to admit that he claimed Fannie and Freddie were in great shape and had bright futures, within the last two months.
Frank can't lie his way out of this one. Sadly, his behavior, and that of Chris Dodd and Barack Obama, the two Senators who received the most in cash contributions from Fannie, were prime causes of the current financial debacle.
As one pundit noted, it took Dodd over a decade to make #1 on Fannie's contribution list. It took the rookie Illinois Senator only 2 years!
Saturday, October 4, 2008
Friday, October 3, 2008
Congress' Lies About Fannie & Freddie
I would be extremely remiss if I did not call to my readers' attentions this excellent piece in yesterday's Wall Street Journal, entitled "What They Said About Fan and Fred."
The quotes from Congressional buffoons such as Barney Frank, Chris Dodd, Frisco Nan Pelosi and, my favorite liberal idiot, California's Maxine Waters, are simply priceless. Did I mention Tom Carper, Chuckie Schumer, and, alas, even Republican Senators Jack Reed and Robert Bennett?
To my great shock, Nebraska's Chuck Hagel, for whom I also have little respect, is the only quoted voice of reason in the whole matter. He is quoted as saying,
"Mr. Chairman, what we're dealing with is an astounding failure of management and board responsibility, driven clearly by self interest and greed. And when we reference this issue in the context of -- the best we can say is, "It's no Enron." Now, that's a hell of a high standard."
I can't leave without at least one hilarious quote each from Frank, Waters and Dodd. At a September 10, 2003 hearing, we read,
Frank: I worry, frankly, that there's a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . .
Waters: Secretary Martinez, if it ain't broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?
And two weeks later,
Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .
Then, on February 24-25, 2004, in testimony during a Senate hearing, we have these remarks:
Carper: What is the wrong that we're trying to right here? What is the potential harm that we're trying to avert?
Greenspan: Well, I think that that is a very good question, senator. What we're trying to avert is we have in our financial system right now two very large and growing financial institutions which are very effective and are essentially capable of gaining market shares in a very major market to a large extent as a consequence of what is perceived to be a subsidy that prevents the markets from adjusting appropriately, prevents competition and the normal adjustment processes that we see on a day-by-day basis from functioning in a way that creates stability. . . . And so what we have is a structure here in which a very rapidly growing organization, holding assets and financing them by subsidized debt, is growing in a manner which really does not in and of itself contribute to either home ownership or necessarily liquidity or other aspects of the financial markets. . . .
Dodd: I, just briefly will say, Mr. Chairman, obviously, like most of us here, this is one of the great success stories of all time. And we don't want to lose sight of that and [what] has been pointed out by all of our witnesses here, obviously, the 70% of Americans who own their own homes today, in no small measure, due because of the work that's been done here. And that shouldn't be lost in this debate and discussion. . . .
And this from Schumer on April 5, 2005,
"I'll lay my marker down right now, Mr. Chairman. I think Fannie and Freddie need some changes, but I don't think they need dramatic restructuring in terms of their mission, in terms of their role in the secondary mortgage market, et cetera. Change some of the accounting and regulatory issues, yes, but don't undo Fannie and Freddie."
Can Schumer look any worse than this?
Where is the shame among Democratic Senators- Carper, Schumer, Dodd- and Barney Frank? With luck, all who are up for election in November will, with the public's outrage, be defeated.
The quotes from Congressional buffoons such as Barney Frank, Chris Dodd, Frisco Nan Pelosi and, my favorite liberal idiot, California's Maxine Waters, are simply priceless. Did I mention Tom Carper, Chuckie Schumer, and, alas, even Republican Senators Jack Reed and Robert Bennett?
To my great shock, Nebraska's Chuck Hagel, for whom I also have little respect, is the only quoted voice of reason in the whole matter. He is quoted as saying,
"Mr. Chairman, what we're dealing with is an astounding failure of management and board responsibility, driven clearly by self interest and greed. And when we reference this issue in the context of -- the best we can say is, "It's no Enron." Now, that's a hell of a high standard."
I can't leave without at least one hilarious quote each from Frank, Waters and Dodd. At a September 10, 2003 hearing, we read,
Frank: I worry, frankly, that there's a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . .
Waters: Secretary Martinez, if it ain't broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?
And two weeks later,
Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .
Then, on February 24-25, 2004, in testimony during a Senate hearing, we have these remarks:
Carper: What is the wrong that we're trying to right here? What is the potential harm that we're trying to avert?
Greenspan: Well, I think that that is a very good question, senator. What we're trying to avert is we have in our financial system right now two very large and growing financial institutions which are very effective and are essentially capable of gaining market shares in a very major market to a large extent as a consequence of what is perceived to be a subsidy that prevents the markets from adjusting appropriately, prevents competition and the normal adjustment processes that we see on a day-by-day basis from functioning in a way that creates stability. . . . And so what we have is a structure here in which a very rapidly growing organization, holding assets and financing them by subsidized debt, is growing in a manner which really does not in and of itself contribute to either home ownership or necessarily liquidity or other aspects of the financial markets. . . .
Dodd: I, just briefly will say, Mr. Chairman, obviously, like most of us here, this is one of the great success stories of all time. And we don't want to lose sight of that and [what] has been pointed out by all of our witnesses here, obviously, the 70% of Americans who own their own homes today, in no small measure, due because of the work that's been done here. And that shouldn't be lost in this debate and discussion. . . .
And this from Schumer on April 5, 2005,
"I'll lay my marker down right now, Mr. Chairman. I think Fannie and Freddie need some changes, but I don't think they need dramatic restructuring in terms of their mission, in terms of their role in the secondary mortgage market, et cetera. Change some of the accounting and regulatory issues, yes, but don't undo Fannie and Freddie."
Can Schumer look any worse than this?
Where is the shame among Democratic Senators- Carper, Schumer, Dodd- and Barney Frank? With luck, all who are up for election in November will, with the public's outrage, be defeated.
Thursday, October 2, 2008
Bob Corker (R-Tenn) Is An Idiot
This morning, on CNBC, I saw a Republican Senator, Bob Corker of Tennessee, make an absolute idiot out of himself.
He did it in a conversation with Dick Armey, a former GOP House Majority Leader and professor of Economics.
After Armey spent several minutes explaining why another failed attempt to pass the financial sector rescue bill in the House might actually be a good thing, he reiterated the point that all that is needed is to rescind, suspend, or modify 'mark to market' accounting to allow performing securities to be valued at their economic, 'hold to maturity' value.
Corker replied that this was not the case. To illustrate his point, the windbag from Tennessee compared a commercial bank to a farmer.
Corker described farmers who were 'land rich, but cash poor,' thus being unable to pay bills, but not being insolvent.
He then went on to tell Armey that US banks would have their fixed asset values refurbished by suspending mark-to-market accounting, but that they would still be 'cash poor.'
He then went further, saying that it was this cash need which the rescue bill would meet.
It's hard to believe just how stupid Corker is.
A commercial bank holding CDOs has nothing like the problem of a farmer with no cash, but valuable land.
First of all, banks are not short of cash. The problem is not one of having too much of a fixed asset, and too little of a liquid one, as Corker believes.
Rather, as described in this post, referencing Brian Wesbury's excellent editorial in the Wall Street Journal, the problem with mark-to-market accounting is that it
"forces all financial firms to treat potential losses as if they were cash losses."
That is, losses in theoretical value in fixed assets must reduce the bank's capital by a like amount.
The situation is nothing like Corker's farm example.
Frankly, it scares me to death to see one of the hundred buffoons who passed this monstrosity completely misunderstanding the phenomenon that is affecting our publicly-held financial institutions.
He did it in a conversation with Dick Armey, a former GOP House Majority Leader and professor of Economics.
After Armey spent several minutes explaining why another failed attempt to pass the financial sector rescue bill in the House might actually be a good thing, he reiterated the point that all that is needed is to rescind, suspend, or modify 'mark to market' accounting to allow performing securities to be valued at their economic, 'hold to maturity' value.
Corker replied that this was not the case. To illustrate his point, the windbag from Tennessee compared a commercial bank to a farmer.
Corker described farmers who were 'land rich, but cash poor,' thus being unable to pay bills, but not being insolvent.
He then went on to tell Armey that US banks would have their fixed asset values refurbished by suspending mark-to-market accounting, but that they would still be 'cash poor.'
He then went further, saying that it was this cash need which the rescue bill would meet.
It's hard to believe just how stupid Corker is.
A commercial bank holding CDOs has nothing like the problem of a farmer with no cash, but valuable land.
First of all, banks are not short of cash. The problem is not one of having too much of a fixed asset, and too little of a liquid one, as Corker believes.
Rather, as described in this post, referencing Brian Wesbury's excellent editorial in the Wall Street Journal, the problem with mark-to-market accounting is that it
"forces all financial firms to treat potential losses as if they were cash losses."
That is, losses in theoretical value in fixed assets must reduce the bank's capital by a like amount.
The situation is nothing like Corker's farm example.
Frankly, it scares me to death to see one of the hundred buffoons who passed this monstrosity completely misunderstanding the phenomenon that is affecting our publicly-held financial institutions.
Wednesday, October 1, 2008
What Sarah Palin Needs To Do In Her VP Debate
I saw an extensive interview this afternoon on Fox News with Geraldine Ferraro. Aside from cramming her partisan views on this election into her closing remarks, I found Ferraro to be dead wrong in her assessment of the situation confronting Sarah Palin.
Simply put, one cannot be what one is not. Sarah Palin cannot, and should not, attempt to become a policy wonk for tomorrow evening's debate in Saint Louis.
Ferraro all but chastised Palin for having no grasp of the 'big issues,' the 'Federal issues' with which she must grapple, both in the debate and in the office of President, should she rise to that. Then Ferraro laughably argued that Lying Joe Biden has 'experience' as a long-serving Senator.
I disagree. Emphatically.
What Sarah Palin brings to the table is an intelligent, well-educated American's view of many important issues confronting our government and nation. This isn't somehow wiped out simply because she is running for VP on McCain's ticket.
Ferraro's comments displayed her typical politician's disdain for the lower class whom she represented. Those silly voters who just don't know anything, until Geraldine would tell them how to think.
Palin is from the opposite end of the spectrum. Unlike Ferraro, the product of Democratic machine politics in New York City, Palin ran against and toppled Alaska's corrupt state government and the GOP leaders who fostered the corruption.
Sarah Palin is the quintessential citizen governor and representative.
Thus, to me, it seems simple. Palin ought not try to train in only a few weeks to sound like a Senator. Instead, she should simply become acquainted with what the issues are. From there, any intelligent, educated American can form reasonably cogent views in a matter of days. Usually, Washington politicians make these things out to be far more difficult and intractable than they really are.
What Sarah Palin should emphasize, to Biden's disadvantage, is her real and formidable experience as a sitting chief executive. Like most Senators, including, regrettably, McCain, Biden has never managed or been a responsible executive of anything.
Sarah Palin has, and is. She should drive that home with fierce determination. Biden is less qualified to be President than Palin simply on the basis that he has no executive experience. None.
If Palin's handlers recognize this, they will facilitate her scoring a clear victory over Biden in tomorrow night's debate.
By responding to 'the usual issues' in Washington as a thoughtful, intelligent outsider, while reminding everyone that she has executive experience, while Biden has none, Sarah Palin can win that debate simply by being herself.
For her to be otherwise will be to play the Washington insider game, and, thus, invite disaster.
Simply put, one cannot be what one is not. Sarah Palin cannot, and should not, attempt to become a policy wonk for tomorrow evening's debate in Saint Louis.
Ferraro all but chastised Palin for having no grasp of the 'big issues,' the 'Federal issues' with which she must grapple, both in the debate and in the office of President, should she rise to that. Then Ferraro laughably argued that Lying Joe Biden has 'experience' as a long-serving Senator.
I disagree. Emphatically.
What Sarah Palin brings to the table is an intelligent, well-educated American's view of many important issues confronting our government and nation. This isn't somehow wiped out simply because she is running for VP on McCain's ticket.
Ferraro's comments displayed her typical politician's disdain for the lower class whom she represented. Those silly voters who just don't know anything, until Geraldine would tell them how to think.
Palin is from the opposite end of the spectrum. Unlike Ferraro, the product of Democratic machine politics in New York City, Palin ran against and toppled Alaska's corrupt state government and the GOP leaders who fostered the corruption.
Sarah Palin is the quintessential citizen governor and representative.
Thus, to me, it seems simple. Palin ought not try to train in only a few weeks to sound like a Senator. Instead, she should simply become acquainted with what the issues are. From there, any intelligent, educated American can form reasonably cogent views in a matter of days. Usually, Washington politicians make these things out to be far more difficult and intractable than they really are.
What Sarah Palin should emphasize, to Biden's disadvantage, is her real and formidable experience as a sitting chief executive. Like most Senators, including, regrettably, McCain, Biden has never managed or been a responsible executive of anything.
Sarah Palin has, and is. She should drive that home with fierce determination. Biden is less qualified to be President than Palin simply on the basis that he has no executive experience. None.
If Palin's handlers recognize this, they will facilitate her scoring a clear victory over Biden in tomorrow night's debate.
By responding to 'the usual issues' in Washington as a thoughtful, intelligent outsider, while reminding everyone that she has executive experience, while Biden has none, Sarah Palin can win that debate simply by being herself.
For her to be otherwise will be to play the Washington insider game, and, thus, invite disaster.
Congress & The Upcoming Elections
This week has revealed the naked truth about Congressional Democrats. We see Chris Dodd all puffed up and acting important, just months after being fingered for accepting an improper mortgage loan from Countrywide, the nation's large, failed residential lender.
Barney Frank, the hapless, idiotic head of the House Banking Committee, has developed amnesia when asked about his pushing Fannie and Freddie to be ever-larger, as well as mandating them to securitize risky, low-income-earner mortgages.
All the Democrats seem to forget their zest and appetite for forcing US commercial banks to comply with the Community Reinvestment Act, which forced them to make many of the very subprime and alt-A mortgages for which they are now blamed.
And let's not forget how often Congress allowed Acorn to hold up necessary, productive, excess-capacity-reducing mergers of US commercial banks, unless more low-income mortgage lending was promised.
But the winner, by far, in this past week's contest for stupidity and bone-headed misleadership has to go to Frisco Nan- Speaker of the US House of Representatives, Nancy Pelosi.
With passage of the financial rescue bill looking certain, Frisco Nan released many of her own party members to vote against the bill, including many committee chairs, freshmen representatives in tight races in the Midwest, and others to whom she chose to grant favors. In all, 90 Democrats were allowed to vote 'no' on the bill.
Then Nan took the floor to expound on her version of the genesis of the need for the bill, giving one of the most vitriolic, partisan speeches of its kind, and certainly during a key, close vote.
When a handful of GOP members therefore voted 'no,' they were blamed for the bill's failure. By no less than Frisco Nan and Barney Frank. Both of whom chose to overlook their own party members' joining with the Republicans.
If you needed proof of what an abysmal, untalented and moronic Speaker Frisco Nan is, this little episode is all you need to know.
Perhaps we Americans will get lucky, and smart, and just sweep all 435 of these clowns out of office come November.
Could we really do any worse with all new faces than this crew has done for us?
Barney Frank, the hapless, idiotic head of the House Banking Committee, has developed amnesia when asked about his pushing Fannie and Freddie to be ever-larger, as well as mandating them to securitize risky, low-income-earner mortgages.
All the Democrats seem to forget their zest and appetite for forcing US commercial banks to comply with the Community Reinvestment Act, which forced them to make many of the very subprime and alt-A mortgages for which they are now blamed.
And let's not forget how often Congress allowed Acorn to hold up necessary, productive, excess-capacity-reducing mergers of US commercial banks, unless more low-income mortgage lending was promised.
But the winner, by far, in this past week's contest for stupidity and bone-headed misleadership has to go to Frisco Nan- Speaker of the US House of Representatives, Nancy Pelosi.
With passage of the financial rescue bill looking certain, Frisco Nan released many of her own party members to vote against the bill, including many committee chairs, freshmen representatives in tight races in the Midwest, and others to whom she chose to grant favors. In all, 90 Democrats were allowed to vote 'no' on the bill.
Then Nan took the floor to expound on her version of the genesis of the need for the bill, giving one of the most vitriolic, partisan speeches of its kind, and certainly during a key, close vote.
When a handful of GOP members therefore voted 'no,' they were blamed for the bill's failure. By no less than Frisco Nan and Barney Frank. Both of whom chose to overlook their own party members' joining with the Republicans.
If you needed proof of what an abysmal, untalented and moronic Speaker Frisco Nan is, this little episode is all you need to know.
Perhaps we Americans will get lucky, and smart, and just sweep all 435 of these clowns out of office come November.
Could we really do any worse with all new faces than this crew has done for us?
Monday, September 29, 2008
In The Wake of The House's Defeat of The Financial Rescue Bill
Today's defeat of the financial rescue plan by the House is a landmark event. And a good one.
It seems to me that the GOP House members showed uncommon valor and brilliance in both devising their insurance idea, and fighting for its inclusion in the bill.
That Frisco Nan seized the floor before the bill's passage to castigate Republicans and the current administration shows why she is such an inept Speaker.
I honestly do not know why any of the rest of the bill is needed beyond a Federal offer to sell credit default insurance to holders of CDOs. This alone would allow those holders of structured financial instruments for which there are no actively traded markets to, instead, immediately mark them to economic, mature value, by dint of the purchased credit insurance.
This would remove the downward spiral of these instruments, allow banks to record them at full value, less defaults, and, thus, minimize counterparty risk, which has been the bar to credit extension.
Despite the Democrat's attempt to spin the defeat of the bill as Republican obstructionism, the House GOP actually has the idea for a much better bill than is currently on offer.
It seems to me that the GOP House members showed uncommon valor and brilliance in both devising their insurance idea, and fighting for its inclusion in the bill.
That Frisco Nan seized the floor before the bill's passage to castigate Republicans and the current administration shows why she is such an inept Speaker.
I honestly do not know why any of the rest of the bill is needed beyond a Federal offer to sell credit default insurance to holders of CDOs. This alone would allow those holders of structured financial instruments for which there are no actively traded markets to, instead, immediately mark them to economic, mature value, by dint of the purchased credit insurance.
This would remove the downward spiral of these instruments, allow banks to record them at full value, less defaults, and, thus, minimize counterparty risk, which has been the bar to credit extension.
Despite the Democrat's attempt to spin the defeat of the bill as Republican obstructionism, the House GOP actually has the idea for a much better bill than is currently on offer.
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