The two most recent occupants of the Oval Office were in prime time tonight, while aspirants to succeed them prepared to go to the White House tomorrow morning in a bizarre interactive TV reality show that will affect the financial survival of millions of Americans.
George W. Bush, who was voted off the island two years ago but refused to leave, looked voters in the eye and talked about panic and recession with a straight face as if he had just arrived and would fix it if only they cheered for his Hail Mary pass without delay and without asking too many questions.
His predecessor, Bill Clinton, with his usual maddening mix of half-faux sincerity and guile, was telling Larry King that Hillary had campaigned for the Democratic nominee more than any runner-up in the last 40 years, that he would join her in Florida after the Jewish holidays, that although he admired McCain and Palin was backing Obama and Biden but devoting most of his energies to making Americans good global citizens for the future. All in all, it came across as the pitch for a new Hillary survival show in 2012 or 2016.
With the past presidents on their way out, the two wannabes were trying to please the electoral audience. Chris Dodd, who is quarterbacking the Senate effort to make sense of the Bush $700 billion dollar plan, welcomed John McCain's interest but drily noted that his campaign suspension sounded more like a rescue plan for his own candidacy than the national economy.
This series will run for the next 40 days until viewers get a chance to vote for the ultimate survivor, but meanwhile the show keeps getting more tacky and there is no way to use a remote control to tune in on something better.
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4 comments:
funny as hell!
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This plan only helps the wealthy. I understand by giving them money the banks in return will be able to keep those loans. How about the other way around? Give the people the money to pay these loans and homes? Or, chop i.e. the price of a $450,000 house to its original value before the bubble to somewhere about $200,000 only if it is his or hers sole residence and only if the income can suffice that loan. We need to address the root of this and that is housing. This problem was created by the banks and the Feds on interest and the whole loaning industry. I realize it will be like ripping off a band aide fast and the wound will still bleed, Wall Street will take a dive, big banks and their executives would skater, but these are the ones this bailout is intended. No matter if we do this proposed bailout or we don’t someone will suffer. So lets bailout the people not the banks. Cut the home prices, let the people move in and this will cause a massive decline in home prices many people who depend on their equity to get them through, and will cause millions refuting second mortgaging and the business that need loans to start or continue production. Each and every one of these loans through transparently and scrutiny, allow to be funded with this bailout money.
“We have to jump start the economy” “We need to give (bailout) the financial institutions so we can have business as usual” “You need to pass this 700 billion dollar plan and pass it now” lets OK a plan but not the one you propose Mr. Paulson, the one we propose “let them eat cake” free the oppressed from this crisis caused by greedy investors. If you want to displace taxpayers’ money, money that they don’t even have, Its money that you intend to barrow from foreign countries with interest Mr. Paulson, then displace it from the bottom up.
All the rest of houses left that were foreclosed that were owned by investors will take a hit also. The idea here is to take an organic approach not a synthetic one
How We Can Clean Up A Lot of the Economic Problems
Remember Enron, WorldCom, Adelphia, and other companies had artificially put assets on the books? They'd say something was worth $10M when they bought it, but eventually it decreased in value, and they never updated the value in the books. That was part of the fraud. Under current laws at that time, they were all convicted and put in jail for fraud.
Then we got all mad and made all these new laws that are coming out the wazoo called sarbanes oxley. It's a huge, massive law but the idea is that we were going to mandate ethics to corporate America because apparently they didn't have any, according to the Enron failure. It's now a total pain in the butt to execute it in a publicly traded company.
It didn't work because you can't cause ethics to happen. However, it does make each company each day restate what their assets are worth if sold on the market. This accounting procedure is mark to market accounting--you need to remember that. It's a good concept and keeps companies from having loaded balance sheets.
How This Affects Us Today
However, it's part of what's caused this in the news now. Merrill Lynch was sitting with $30 billion tied up in sub-prime loans with houses. Stupid! They get what they deserve for doing that, and I'm with you on that. Those houses didn't become worthless all of a sudden because those people couldn't sell their bonds. Since they couldn't sell them, they basically gave them away for 22 cents on the dollar. Now do you think all those houses lost 80% of their value underneath that deal? No, they didn't, so they gave them away for 22 cents on the dollar (about $6 billion total) because there was no market for them. Nobody wants to buy sub-prime bonds because they suck. They're junk bonds. But at 22 cents on the dollar, it's a bargain because even if you foreclosed on every one of the houses in there, you'd probably get $20 billion back out of $30 billion, and so the company that bought those for $6 billion got a deal! But there's no market for them. That's where these companies are stuck. They can't sell this stuff, but accounting-wise, they've had to mark it down to market and it's frozen the marketplace.
Economist Wesbury is saying that if we change that one rule and don't force them to mark down to market value and just let them hold on to all the stuff, and say just on sub-primes for this period of time you can change that rule -- a temporary change -- that'll free the market up. It's seized right now; it's frozen. This will thaw it out and get it going again. He says that'll solve 60% of the problem ... and I think he's right.
That one accounting rule is what made Merrill Lynch sell out. That one accounting rule is what's driving other ones into the dirt. Would you rather let them change their accounting rule or loan them $700 billion for us to buyout their bad paper?
I'd rather them work their own crap out than change the accounting rule.
I don't like giving them any money or any help with my tax dollars. But I'd rather see that than see the whole thing turn completely upside down in a fruit basket turnover than have a whole meltdown or something and freak out here in the middle of the election season. Why don't we just take the FHA insurance program and extend it across these sub-primes? What that means is that you and I are guaranteeing the lender that they're not going to lose as much or any money on those mortgages. Now I don't like guaranteeing them, but I like it better than buying them. In other words, instead of $700 billion in tax-payer debt going out there to bail out these companies, just extend the insurance out. You could probably do that for less than $40 billion. It's like a 95% savings!
If the government insured those mortgages, they would then be marketable. And could sell them. And the companies would stay afloat. And we, the people, don't have to get into the mortgage business. Now we're going to get in there a little bit because of the insurance on those getting foreclosed on. But foreclosures aren't causing this. This is being caused because these companies are frozen and seized up. We've got to let some of the steam come off and put some oil in there to get this thing moving again. We can do that without going into debt $700 billion.
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