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ksundheim 07/23/2010 06:32 PM Report
I began watching Charlie Rose and came across this particular topic. I am not even going to venture to comment on this as this blog is a little out of my league, though in the least, some of this, in an indirect manner, helped me with my business:
<a href="http://www.kasplacement.com">KAS Sales Recruitment and Marketing Staffing Agency</a>
slightly_optimistic 07/23/2010 11:47 AM Report
The House Financial Services Committee is only the bookkeeper at times.
"But the time has come for us to scale back our military reach", said the chairman in the interview last week.
However on Tuesday this week we had the Kabul international conference on Afghanistan. Asia Times reports that the speeches suggested that the US would be staying in Central Asia long-term. A contract for a US Special Forces base in northern Afghanistan - at about $100million - is being let. The Russians and Chinese were not amused.
robdverity 07/19/2010 09:10 PM Report
REM - It's a bit disingenuous to state the facts without perspective. True they bought homes they could not afford. But the shear magnitude and quality was so rife and so sophisticatedly insophisticated that it had to be fueled by stringent recruitment. People that gullible had to be virtually collared off the streets, recruited in every probable and improbable venue. Their engulfing loan offices with the knowledge of how flipping works is beyond credibility. They were conscripted for their signatures. Lying (about jobs, income) winked at and encouraged. That requires beforehand knowledge of what was acceptable de rigueur.
REMant 07/19/2010 01:36 PM Report
This crisis was brought on because ppl could not afford the homes they bought. You can argue that this is because they were sold deceptive mortgages, but the fact remains they could not pay them, tho everyone expected them to, and why? Because everyone was sure the "value" of these houses would go up to cover the cost. In other words real estate was sold as if it were the stocks bought on margin in the 1920's. In both cases it was the result of too much leverage - i.e., bank notes and credit instruments built on them - supported by the Fed's policy of stable price levels, if not I suspect a mercantilist belief that higher prices meant greater wealth. Of course recently this was exacerbated by proprietary trading, derivatives, computerized trading models, etc, but it was caused by the expectation that the houses, like the stocks, could be flipped in perpetuity. It could not, it turned out because eventually the interest was too much to be paid. It was a gigantic pyramid scheme. Virtually the same thing that happened in Japan in the 1990's. Unfortunately, we have so far made the same response, which I have no doubt will produce the same result. This bill changes little about that in concrete terms. It will take responsible implementation and good administration, but we could have had that before. It may be popular because it, like the health care bill, blames the industry, but under the hood, very little is changed. This is made very clear in Bernanke's insistence that the problem was only a "glut of savings," or when we hear that all we need is more insurance. BTW, I believe we still have a Marine division on Okinawa to support our presence on the Korean peninsula.
robdverity 07/16/2010 06:36 PM Report
More from the NYT:
They found allies in Congress and beat back the proposals most critical to their survival. Reinstating Glass-Steagall and banning naked credit default swaps — two of the most sweeping ideas — were cast aside.
Some of the other serious proposals were eventually pared down. Arkansas Senator Blanche Lincoln’s proposal to spin-off derivatives trading desks changed to allow banks to keep some of the more profitable trading under their aegis; the Volcker Rule was altered to allow banks to continue to invest some of their own cash to speculate in markets; the bank tax, to pay for a resolution fund, was replaced by the use of taxpayer funds.
The legislative and lobbying effort was much like a World War I battle. The banks may have suffered some losses, but they held the line.
VENALITY > STATESMANSHIP!
robdverity 07/16/2010 05:59 PM Report
Can't resist excerpt from todays Paul Krugman's op ed. Redo That Voodo:
". . . . But we’re talking about voodoo economics here, so perhaps it’s not surprising that belief in the magical powers of tax cuts is a zombie doctrine: no matter how many times you kill it with facts, it just keeps coming back. And despite repeated failure in practice, it is, more than ever, the official view of the G.O.P.
"Why should this scare you? On paper, solving America’s long-run fiscal problems is eminently doable: stronger cost control for Medicare plus a moderate rise in taxes would get us most of the way there. And the perception that the deficit is manageable has helped keep U.S. borrowing costs low.
"But if politicians who insist that the way to reduce deficits is to cut taxes, not raise them, start winning elections again, how much faith can anyone have that we’ll do what needs to be done? Yes, we can have a fiscal crisis. But if we do, it won’t be because we’ve spent too much trying to create jobs and help the unemployed. It will be because investors have looked at our politics and concluded, with justification, that we’ve turned into a banana republic."
robdverity 07/16/2010 05:42 PM Report
Damn you gotta hand it to ole Barney, he sure comes off logical, practical and folksy as an old shoe. Fortified by his disappointment that car dealers were left out of the bill.
Derivatives should be in a partnership - only.
The bill and the meaningless $550 million GS fine says the actual rulings (to be written) will be bought-off and watered down to be not-much. The venality roars on. The Fed. Res. and the SEC et al are so corruptible they're an embarrassment to civil and fiduciary mercantilism.