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Serious business for the infantile November 20, 2010

Posted by WillardWhyte in Economy, Greed, Politics, U.S. Budget, Wall Street.
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Exactly when did these two guys — Simpson in particular — become the ultimate in Wise Men?

And from this piece, there seems to be a whole lot of chortling going on over the potential ruination of the U.S. economy if their particular strategy for reducing the deficit — and radically overhauling the entire tax code with little assessment of impact — is not swallowed pretty much whole. Get this:

“I can’t wait for the bloodbath in April,” Simpson said, relishing the prospect of political turmoil. “When debt limit time comes, they’re going to look around and say, ‘What in the hell do we do now? We’ve got guys who will not approve the debt limit extension unless we give ‘em a piece of meat, real meat” in the form of spending cuts. “And boy, the bloodbath will be extraordinary,” he said.

Extraordinary indeed. It’s all a game to him too — the graying, dottering Fox can’t wait for the Hen House to catch fire.

Shameful.

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Funny, didn’t hear about this on Monday November 4, 2010

Posted by WillardWhyte in Economy, Greed, Politics.
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The guy set to take over the House Financial Services Committee — which oversees agencies regulating banks — shows what’s tops on his agenda: Rolling back financial reforms to let the banks back into high-stake gambling with U.S. government insured deposits. That’s long for: Your money and mine, “insured” by your tax dollars and mine.

Reuters is here and Salon is here. Here’s a quote from Rep. Spencer Bachus’ letter to Treasury Secretary Timothy Geithner and other top regulators, who are writing rules they were ordered to write by the financial reform law passed last spring.

I strongly recommend that your study of the Volcker Rule take account of how trading activities fit into the core business plan of global banks, as well as the consequences for U.S. banks and the banks’ clients of prohibiting those activities in the U.S. while they continue to be permitted everywhere else in the world.

Funny — I’ve read that five times now and I must have missed the part about you and me and how the Volcker Rule would be bad for us and getting rid of it would create jobs.

Well Butch, we’ll get to all you cowpokes out there after we make things better for Wells Fargo.

Maybe there’s a reason it’s called FOX News September 1, 2010

Posted by WillardWhyte in Economy, Greed, Justice, Politics.
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I see that former Wachovia Corp. Chief Executive Officer Robert Steel is telling the Financial Crisis Inquiry Commission today that he was told by FDIC Chairman Sheila Bair in late Setptember, 2008 to find a dance partner with something left in its pockets, because the mortgage crap it was holding threatened the U.S. banking system.

This Bloomberg News story tells the early tale. Make particular note of this:

Steel, the former U.S. Treasury Department and Goldman Sachs Group Inc. executive, was brought in to lead Charlotte, North Carolina-based Wachovia in 2008 as the lender struggled to recover from the aftermath of its $24 billion purchase of Golden West Financial Corp. The deal saddled Wachovia with about $120 billion of adjustable-rate mortgages that allowed borrowers to skip some interest payments and add them to the loan balance. The concept assumed home prices would go up. Instead, the idea backfired when prices fell, leaving borrowers with mortgages that exceeded the value of their homes and Wachovia with mounting losses.

That’s $120 billion in garbage interest-only and other high-risk mortgages created by the bankers in California to pump new money into the superheated real estate market driven by flippers and other speculators. BIG NOTE: This was not done by government; it was done by the private sector, at the end stage aided and abetted by Fannie Mae and Freddie Mac, also at the time privately held and run by financial industry veterans.

So please don’t swallow the myth being spun — and heavily marketed by Wall Street — that the bubble slime on all of US was OUR fault because of actions by OUR government. It’s just not true.

Sure, many of US were sucked into the interest-only crap, or steered into liar loans.  And many of US benefited from the housing boom, which put a lot of people to work for a very long time making houses, selling houses and producing all the materials that went into what was a major part of the U.S. economy for two decades.

That’s almost all gone now folks — and no amount of “tax cuts” and “getting government off our backs” is going to bring it back. Something else must be built to take its place, and that’s a whole lot harder and will take a long time. Everyone running for Congress needs to explain in detail how they plan to make that rebuilding happen.

We all should watch what is said before this commission and make sure this story is told fully, extensively — and accurately.

Because what all fell down in September 2008 — and the people who made that happen and reasons for it — is why we still are struggling today — and will for the next five years — to rebuild our economy.

And it wasn’t our fault;  it wasn’t our government’s fault. It was the fault of recklessness, greed and fraud by private industry leadership. And many of those foxes want to be put back in charge of the hen house.

Trickle Down isn’t working, sport August 3, 2010

Posted by WillardWhyte in Economy, Greed, Politics.
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I’ve often found myself liking Newt Gingrich — when he’s out there just talking, pushing to press his point of view on how to go about solving a problem. His energy and refusal to fall back on the easy-out can be quite captivating, even though I often disagree with his landing zone.

But that all happens when the man isn’t wearing his six-shooters, when he’s not out there banging the drum for the GOP and all Red in the face — like in this little ditty with ABC News. I don’t like the Pit Bull Gingrich, though as a political observer I know there are few more dangerous.

When the man talks of Democrats as “job killers,” the option of raising marginal tax rates on the “job-creators” as “crazy” he is both effective — and a traitor to his own heart.

He — probably more than any figure within the Big Red Tent — has the tools, the energy and the True Believer credentials to lead. To forge an agenda, amass a cadre that could take the debate away from the slime pit to a place that might arrive at Tough Love steps we need to move forward.

Some of those things would whittle down a troubling deficit. Some of them would attempt to remove the monopoly barriers to free enterprise and competitive vitality that grow more dangerous here each day. Some of them would simply point a finger at all those “job creators” and ask why they sit on mounds of corporate cash reserves, why they squeeze and intimidate a workforce that pulled their ventures through the recession rather than add back just a handful of the ghosts, why they continue to seek every opportunity to take, when they owe?

We are so much better than this. So are you Mr. Speaker.

Let them eat (less) cake August 2, 2010

Posted by WillardWhyte in Economy, Greed, Politics.
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We all should brace for a bigtime spittle eruption from the folks down in D.C. who view their job as an elected official as little more than to pose as a guardian of privilege. On deck is a fight over whether to extend a whole bunch of tax cuts enacted back in the good old days circa 2001 and 2003.

The Privilege Party will go to bat against the President’s plan to retain most of the reductions, but allow rate cuts to expire for people with incomes in excess of $200,000 or families making more than $250,000 a year. I found this Washington Post primer to be quite helpful, particularly as it addresses some of the myths the Privilege Party will soon begin to trot out. And the PP includes folks Red and Blue. Here’s the nut of what Obama and others of both stripes are targeting as a middle road:

The cuts lowered tax rates across the board on income, dividends and capital gains; eventually eliminated the estate tax; further lowered burdens on married couples, parents and the working poor; and increased tax credits for education and retirement savings. Obama’s proposal would extend most of these reductions, allowing only those for individuals making more than $200,000 and families making more than $250,000 to expire.

I urge you to read through the whole thing and then wander around and try to vet any factual statements you wonder about and then tune in to some of the discussions going on out there on this question.

Because this is the first big choice on the table if you really want to start to whittle down that federal budget deficit. There is spending to trim, of course, much of it wheedled into the tax code and other repositories to subsidize folks like the oil industry by keeping the real costs of fossil fuels artificially low.

A thought I hope you keep in mind: These lower tax rates for capital gains, massive estates and the top 2 percent of wage earners have done nothing in the last 18 months to trigger lending to small business by the banks we bailed out, motivate investment, hiring or innovation by corporations now back in business with 20%-25% margins built on huge productivity gains squeezed out of a fearful labor force, or any type of  economy-building activity that I can see.

Perhaps a higher tax bill for the occupants of the Gravy Train right now would provide for our esteemed “private-sector leadership” what appears to be a very much needed kick in the ass.

An interesting set of rich-poor stats … July 28, 2010

Posted by WillardWhyte in Economy, Greed, Politics.
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from the folks at the Federal Reserve bank. So if the cashier asks you whether that’s credit or debit, you probably should say credit (assuming you pay it right down) so as you don’t indirectly tip some rich guy out in the Hamptons.

Maybe recent Financial Reform legislation will address “wealth transfer” with the clause that allows merchants to provide a discount for cash customers.

Dunno. Dunno if there’s anything that needs to be done about this down on the Potomac. Would seem like something that the market could correct on its own with a whole lot of consumer awareness and focused demand.

This one’s wafer-thin, but still may not fly July 28, 2010

Posted by WillardWhyte in Economy, Energy, Environment, Greed, Politics.
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Having abandoned a controversial cap-and-trade attack on the causes of global warming, the Democratic leadership in Congress is now pushing a pretty vanilla bill on energy, oil spills and a dash of help for a struggling economic recovery.

Already, the Armies of Idiocy are gathering up their arms to mount another “Did not!” “Did too!” debate I’m sure CNN will cycle all day.

(more…)

Reds 0, Blues 0 — Flip a Golden Coin July 28, 2010

Posted by WillardWhyte in angry rants, Greed, Justice, Politics.
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Doesn’t really matter who you want to blame for this one — the boys in Blue for rushing to get a small patch in place to at least let you know who is behind the gusher of money that will pour into political advertising this fall, and keep foreign corporations like BP out of the game, or the Reds for clicking their heels together in yet another chorus of “Nyet.”

It was a rushed bill — and the exemptions for a few like the National Rifle Association torched any stand on the principle of the matter. Creating a priviledged class within this regulation would have rendered the law unjust.

But once again the GOP leadership showed how adept it is at dishing the pure manure. (more…)

Methinks this also June 19, 2010

Posted by WillardWhyte in Economy, Greed, Justice, Obama, Politics.
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Sometimes it’s just better to let someone else say it, when they’ve said it about as well as you would have if you were paying better attention and were less lazy. So on the subject of  the FCC asking what people think about “net neutrality” options, I’m going to bow to Tony Bradley over at PC World.

The nut is here:

The bottom line is this: The FCC has a mission to fulfill and the court decision earlier this year in Comcast v. FCC challenges whether the FCC has the legal authority to effectively carry that mission out as it relates to broadband Internet. The FCC action on Thursday simply initiated a public discussion to review the pros and cons of various alternatives, and determine the best course of action. Businesses and commerce rely on the Internet. The FCC Notice of Inquiry offers an opportunity for all to participate in an open dialog and democratic process to determine what is best for the country as a whole.

Clearly, the big broadband signal providers don’t want that, and respond to a call for discussion with bluster, scare tactics and other sabre rattling. They know they are in monopoly control for the moment and anything that alters that in the name of the general good will be opposed tooth-and-nail.

But as I have said before, they are corporations acting as they are chartered to do to preserve every last ounce of benefit they can for that narrow group that owns a share of their soul. To expect less is living in denial. And I don’t advocate in any way altering that calculus.

But the discussion is not about that. It is what is best for you, me and simply millions of other businesses these six or seven could ruin, hamper or extort if the cop on the beat — the FCC — is not equipped with sufficient powers to preserve a “free” and “fair” market.

Not “taking over” the intersection, just coming up with enough rules so that the people with the Hummers aren’t the only ones who get through it alive.

Getting close on reform June 9, 2010

Posted by WillardWhyte in Economy, Greed, Wall Street.
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After a very long  journey, congressional conference appears to be nearing some sort of consensus on financial reform, although the details seem to be dribbling out in a somewhat disappointing manner. Things are a lot less open than Rep. Barney Frank promised months ago, which can only result in mischief.

I highly recommend the summary view Politico posted up in the last day or so providing the views of  Joseph Stiglitz, a 2001  Nobel Prize winner in  economics and experienced in the ways of Washington from a stint as chairman of Bill Clinton’s Council of Economic Advisers.

I’d pay particularly close attention to his comments on derivatives and the various aspects of the two bills that take differing approaches to regulation in this area — and his advice to adopt the Volcker Rule as well as the tough elements in the Senate bill put forth by Sen. Blanche Lincoln. And to provide authority to undo deals that bypass clearinghouse and other rules.

I also think he is right on the money when he says Congress must make its intent clear in each and every instance, so that the inevitable legal engagements have something to reference aside from the Dancing of the Legal Stars.

The full piece is here.  The time is now — so anyone who values their money should weigh in.