The Bailout: Take 2

[3113]

If at first you don't succeed....

WASHINGTON - President Bush said Thursday "a lot of people are watching" to see if Congress will enact the $700 billion financial rescue plan that he called the best chance to restore calm to the financial industry. As both Democratic and Republican House party leaders worked the offices and halls of congressional office buildings to find enough votes for passage in a floor showdown scheduled for Friday, Bush spoke with more urgency than previously as he lobbied furiously for the measure.

Bush, speaking to reporters in connection with a White House meeting on the problem, said increasingly tight credit is not only stopping small business expansion, but in some respects is threatening the very ability of small businesses to exist. He said lawmakers "must listen" to those arguing for passage of the bill, derided by many on Capitol Hill and within the general public as a handout to a risk-taking Wall Street.

The Senate resuscitated the measure on a 74-25 vote late Wednesday, sending it to the House, where it was rejected on a 228-205 vote Monday. In doing so, senators added billions of dollars worth of tax cuts and other sweeteners aimed at luring the dozen or so votes necessary to get the bill to the White House for Bush's signature. On another front, Sheila Bair, chairman of the Federal Deposit Insurance Corporation, urged people to remain calm. "I think overall the banking system remains very sound so that's why I think it's so important for everybody to keep their head," commission Chairman Sheila Bair said on C-SPAN. "What I don't want is to see otherwise healthy institutions start to get into trouble just because of liquidity pressure ... Wall Street should be taking their cue from Main Street right now. Main Street deposits are staying there."

But the drumbeat of bad news rattled on. A government report said that orders to U.S. factories plunged by the largest amount in nearly two years as the credit strains smashed manufacturers with hurricane-like force. Stocks declined on Wall Street early Thursday after the number of people seeking unemployment benefits rose last week to a seven-year high. The Dow Jones industrials fell by about 135 points, their fourth straight triple-digit move. Bush said the issue is affecting employees and families across the country and that lawmakers "must listen" so confidence can be restored in markets and financial institutions.

...To some degree, at least, House GOP opposition appeared to be easing as the Senate added $100 billion in tax breaks for businesses and the middle class, plus a provision to raise, from $100,000 to $250,000, the cap on federal deposit insurance. House Republicans also welcomed a decision Tuesday by the Securities and Exchange Commission to ease rules that force companies to devalue assets on their balance sheets to reflect the price they can get on the market. There were worries, though, that the tax breaks might cause some conservative-leaning Democrats who voted for the rescue Monday to abandon it because the revised version would swell the federal deficit.

...Increasing the deposit insurance cap was a bid to reassure individuals and small businesses that their money would be safe in the event their banks collapsed. It was particularly geared toward small banks that fear customers will pull their money and park it in larger institutions seen as less likely to fold.

I sure hope that axis of evil Nancy knows this time not to be mean and tell the republicans that this is mostly their fault and make them too upset to pass the bill. The future of our country is riding on her not hurting anyone's delicate feelings

 

[JAMESBJOHNSON]

3113

Nice spin.

However everyone had a piece of the action. The Republicans were sooo afraid of beuing labelled RACIST, they caved on mortgages to "low income" Americans, and your lambs didnt make their house payments. Awwwwwww, mean Old Repugs! Dubya didnt make the house payments for the disadvantaged lambs, and its all his fault.

 

[neonlyte]

If at first you don't succeed....


I sure hope that axis of evil Nancy knows this time not to be mean and tell the republicans that this is mostly their fault and make them too upset to pass the bill. The future of our country is riding on her not hurting anyone's delicate feelings

Look... if Nancy is your future... yor're fucked.

Sure... I wouldn't crawl over Nancy to get to Bill Clinton but hey, I'm like, 59, I ain't got no reason to be choosy. Nancy is but(t) a pitstop. She's not a true Dem, she's a Stevie Wonder Dem, she doesn't see what's ahead of her.

Nancy needs some spunk. Nancy needs to say 'Fuck this, boys. Your shit, you clean it... I gotta go massage me a man who sounds like a Muslim.'

Of course... the tricky bit is blaming it all on Cheney

 

[3113]

Look... if Nancy is your future... yor're fucked.

Excuse me! Nancy actually got blamed by Karl Rove himself for being all mean and partisan! She obviously knows how to tweak republican noses and make them all vote "no" on bills just to spite her.

Personally, I thought her speech was rather tepid, but with an endorsement like that from Rove, what more do you need?

 

[3113]

Oh, and I think we should start a betting pool. Pass on Bailout Take 2 or no Pass?

 

[rgraham666]

No pass.

The Republicans would rather gargle hydrochloric acid than go against their 'free market' principles.

And except for the fact that the economy would be in a lot of trouble if the 'financal sector' collapses, I agree with them. I'd like to see that bunch of dishonest jerks crash and burn.

 

[sr71plt]

At least it will give LeJacuelope pause in his latest Chicken Little act--it contains the FIDC-insured limit raise to $250,000. I suppose if the bill fails, though, LeJ will blame the Libertarians for sabotaging it for containing that provision.

 

[Safe_Bet]

At least it will give LeJacuelope pause in his latest Chicken Little act--it contains the FIDC-insured limit raise to $250,000. I suppose if the bill fails, though, LeJ will blame the Libertarians for sabotaging it for containing that provisions.

Just the female libertarians!

 

[neonlyte]

Excuse me! Nancy actually got blamed by Karl Rove himself for being all mean and partisan! She obviously knows how to tweak republican noses and make them all vote "no" on bills just to spite her.

Personally, I thought her speech was rather tepid, but with an endorsement like that from Rove, what more do you need?

Ohhh come on... even you don't believe that! I too thought her statement was tepid, it did nothing to rouse the Dems who voted no or deter the Dems who voted yes. She stood on the fence and toppled to the Rep side. Jesus, losing that vote to a Rep majority was suicide... the vote should have been lost... it's too soon, the damage is greater than Paulsen thinks and he'll be back in a three weeks, if he survives, asking for more money. Bailing out banks that are likely to fail due to their over exposure is suicide... hey, that doesn't matter... it's only tax payers money. Dems should have nothing to do with this vote. Abstain - let the Rep's take it on the chin.

 

[3113]

No pass.

The Republicans would rather gargle hydrochloric acid than go against their 'free market' principles.

Okay. One vote for "no pass." How much are you betting? There's a 4 point spread here....

At least it will give LeJacuelope pause in his latest Chicken Little act--it contains the FIDC-insured limit raise to $250,000. I suppose if the bill fails, though, LeJ will blame the Libertarians for sabotaging it for containing that provision.

So, No Pass for you? And what should I mark down for your bet?

http://www.tommymac.com/images/layout/g.bfilm.arbuckle.jpg

 

[sr71plt]

So, No Pass for you? And what should I mark down for your bet?

I'm not voting on it (thank God). I'm too busy with my own work to try to unravel it. Something has to be done--but I'm not wild about bailing anyone out, banks or mortgage risk takers ("to maximize their toys"), right to the edge of disadvantaging me, who have paid off my mortgages and lived within my means. I have no idea what legislation would make that happen (probably none).

And I'm all for raising the FDIC insurance ceiling to $250,000 (and said so on LaJoke's thread, although he wasn't listening). And not because of individuals--I still hold that it's easy enough for individuals to spread their money (if they have that much liquid money) amoung several banks, indeed, that they should. I think it needs to be raised to take care of businesses with bank accounts, with businesses having more reason to have that much floating free in a single bank than individuals do.

 

[sr71plt]

I also see no reason to rub Nancy Pelosi's nose in the House failure to pass. It didn't pass because of a Republican revolt on a Republican administration bill to try to do something about a festering Republican administration failure. She can rub their noses in it all she wants, as far as I'm concerned.

 

[Saucy_Sage]

It will pass, regardless of what nancy pelosi does.

Her speech last time changed not one mind, but did give the Republicans an excuse to whine about partisanship. She should have saved it until after the vote.

 

[sr71plt]

She should have saved it until after the vote.

In situations like this, I think, "What would a Republican do in this situation?"

'Nuff said.

 

[DesertPirate]

Our "Thundering Herd of Dumbass" again doing the wrong thing when they could have done it right the first time.

"Saddest Thing About This Mess: Congress Had Chance To Stop It

By TERRY JONES
INVESTOR'S BUSINESS DAILY | Posted Friday, September 26, 2008 4:30 PM PT

Could the crisis at Fannie Mae-Freddie Mac and the subprime meltdown have been avoided? The answer is yes.

IBD Exclusive Series: What Caused The Loan Crisis?

As early as 1992, alarm bells were going off on the threat Fannie and Freddie posed to our financial system and our economy. Intervention at any point could have staved off today's crisis. But Democrats in Congress stood in the way.

As the president recently said, Democrats have been "resisting any efforts by Republicans in the Congress or by me . . . to put some standards and tighten up a little on Fannie Mae and Freddie Mac."

No, it wasn't President Bush who said that; it was President Clinton, Democrat, speaking just last week.

Interesting, because it was his administration's relentless focus on multiculturalism that led to looser lending standards and regulatory pressure on banks to make mortgage loans to shaky borrowers.

Freddie and Fannie, backed by an "implicit" taxpayer guarantee, bought hundreds of billions of dollars of those subprime loans.

The mortgage giants, whose executive suites were top-heavy with former Democratic officials (and some Republicans), worked with Wall Street to repackage the bad loans and sell them to investors.

As the housing market continued to fall in 2007, subprime loan portfolios suffered major losses. The crisis was on — though it was 15 years in the making.

Democrats Blocked Reform

Just as Republicans got blamed for Enron, WorldCom and other early-2000s scandals that were actually due to the anything-goes Clinton era, the media are now blaming them for the mortgage meltdown.

But Republicans tried repeatedly to bring fiscal sanity to Fannie and Freddie. Democrats opposed them, especially Sen. Chris Dodd and Rep. Barney Frank, who now run Congress' key banking panels.

History is utterly clear on this.

After Treasury Secretary Lawrence Summers warned Congress in 1999 of the "systemic risk" posed by Fannie and Freddie, Congress held hearings the next year.

But nothing was done. Why? Fannie and Freddie had donated millions to key congressmen and radical groups, ensuring no meaningful changes would take place.

"We manage our political risk with the same intensity that we manage our credit and interest rate risks," Fannie CEO Franklin Raines, a former Clinton official and current Barack Obama adviser, bragged to investors in 1999.

In November 2000, Clinton's HUD hailed "new regulations to provide $2.4 trillion in mortgages for affordable housing for 28.1 million families." It made Fannie and Freddie take part in the biggest federal expansion of housing aid ever.

Soon after taking office, Bush had his hands full with the Clinton recession and 9/11. But by 2003, he proposed what the New York Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago."

The plan included a new regulator for Fannie and Freddie, one that could boost capital mandates and look at how they managed risk.

Even after regulators in 2003 uncovered a scheme by Fannie and Freddie executives to overstate earnings by $10.6 billion to boost bonuses, Democrats killed reform.

"Fannie Mae and Freddie Mac are not facing any kind of financial crisis," said Rep. Frank, then-ranking Democrat on the Financial Services Committee.

North Carolina Democrat Melvin Watt accused the White House of "weakening the bargaining power of poorer families and their ability to get affordable housing."

In 2005, then-Fed Chairman Alan Greenspan told Congress: "We are placing the total financial system of the future at substantial risk."

McCain Urged Changes

That year, Sen. John McCain, one of three sponsors of a Fannie-Freddie reform bill, said: "If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system and the economy as a whole."

Sen. Harry Reid — now Majority Leader — accused the GOP of trying to "cripple the ability of Fannie Mae and Freddie Mac to carry out their mission of expanding homeownership."

The bill went nowhere.

This year, the media have repeated Democrats' talking points about this being a "Republican" disaster. Well, McCain has repeatedly called for reforming the mortgage giants. The White House has repeatedly warned Congress. This year alone, Bush urged reform 17 times.

Some GOP members are complicit. But Fannie and Freddie were created by Democrats, regulated by Democrats, largely run by Democrats and protected by Democrats.

That's why taxpayers are now being asked for $700 billion."

 

[Saucy_Sage]

In situations like this, I think, "What would a Republican do in this situation?"

'Nuff said.

Story of my life.

I never get 'Nuff.

 

[DeeZire]

Some GOP members are complicit. But Fannie and Freddie were created by Democrats, regulated by Democrats, largely run by Democrats and protected by Democrats.

So, when the Rs control both houses of congress, and there's an R in the Whitehouse, the Ds can do whatever they want? I didn't realize our democracy worked that way. Thanks for the tip.

 

[3113]

I also see no reason to rub Nancy Pelosi's nose in the House failure to pass.

Well, you'll noticed that I'm actually rubbing the noses of the Republicans who publicly whined that it was all her fault that their buddies didn't vote to pass the bill. I expect certain people to point fingers at the other side every time something goes wrong, but this really made some of them look ridiculous. As if that tepid speech was all it took to change the minds of these supposedly hardened, do-or-die American Republicans? Please

 

[DesertPirate]

Just the female libertarians!

The board seems more intelligent since I put LeJackasslope on iggy

 

[DesertPirate]

NY Times article from 1999 that explains exactly where this mess started.

http://query.nytimes.com/gst/fullpa...sec=&spon=&partner=permalink&exprod=permalink