Thank you for taking the opportunity to correct one word out of my entire response to you because grammatically it wasn't 100% correct. Tell me, was that really needed? And yes I meant record highs, meaning the deficit and national debt is the highest it's ever been in decades, and possibly (as only time will tell) in history. And yes, I know about Fannie Mae's creation. It was part of FDR's "New Deal" back in the 1930's to try and steer the country out of the Great Depression and whether it actually helped us as a country is up to interpretation. One could argue that with how badly Fannie Mae crashed and burned that it didn't help us at all, while others could say it (for the time being) prevented the economy from decaying further...which was enough to help slowly steer the country out of the depression and help stabilize things here at home. No matter what way you look at it...20th century economic policies do not work in a 21st century world and things need to changed. The value of the dollar has changed, businesses have changed and so has world commerce. What was useful back in the 1930's will not work in the year 2008 and we almost needed this crisis as a way to wake us up that something needs to change. I am not proposing that we don't do anything like you suggest lpboarder, but I do think we need more than just a bailout as it will not prevent us from having this happen again in the future. Obama, McCain, Biden etc are only supporting the bill because we need an immediate fix. Even when the elections happen, it will still take until January for the new president to get into office and I do not think we could survive 2-3 months without doing something. Inaction is the worst thing we could do as a country at this moment. Honestly though, the winner of this whole economic crisis is Obama as a quick comparison of McCain's economic plan VS. Obama's will reveal Obama has a much greater hold on this situation then McCain does. To McCain supporters: We're supposed to fix this issue by continuing all of Bush's economic policies? How does that make any sense?
Here's everything that I have to say about everything: The Wall Street Bailout first of all. First of all, here's the deal on what is ACTUALLY HAPPENING. (Because I've noticed some people are pretty misinformed and having a mother who works as a stock broker I've pretty much got this down by now. lol.) Right now in order for someone to buy a home or a small businesses to get loans to meet pay roll, the amount of interest they pay is a lot higher due to banks not trusting to lend to one another. Therefore, in order for banks to start lending to each other and to people and businesses again this "bill" will allow for congress to vote to buy up paper that banks are holding at a very low price because of a ruling that was put into place after ENRON blew up that said they had to put the price of these unregulated loans very low... So, even though a house is the collateral behind the loan, a lot of this paper is priced at maybe $00.20 on a dollar. One item to correct this, called "the mark to the market rule", would allow banks to put a truer value on the paper and therefore making their balance sheets stronger because right now these banks look like they have no assets even though they do. They are talking about charging the banks an insurance premium against the paper instead of actually buying the paper from them and the government will backstop the paper. They're also talking about lifting a lot of the SEC rules in the marketplace to allow liquidity to flow through the market. The republicans wanted this rather than the bailout plan that Paulson has put up hence why they knocked down the original plan. The bailout bill will basically put all the systems back in "contact" with each other The stock market is not acting like a true market because what's happening in the credit markets, the overnight rate that banks charge each other to lend to each other rose to 7% and it's normally 2% because the bonds (short term) are at such a low price right now that's where the risk is. No one wants to buy them. By taking over/insuring the bad paper and taking it out of the banks books each bank looks stronger and they begin to trust each other again. The every day person sees it as bailing out Wall Street, unfortunately we're bailing out ourselves after a few unscrupulous CEOS and politicians messed it up. Paulson unfortunately explained it the wrong way hence why everyone's shitting themselves over it. They're pissed because they feel like they're suffering to help people who lived outside of their means and whatnot. That's not the case. That's what started this whole mess, but it's not what we're doing now. This all started during Clinton's administration when he pushed Fannie and Freddie to sell to low income people who had no right to get a mortgage. It's basically trickle-down. You have to get the banks out of the way so that small businesses can start making money again and make payroll on Wednesday. Because that's how bad it's gotten And no, we aren't looking at another Great Depression. Underneath the whole mess the economy is still strong. Great depression? Unemployment was 25%, foreclosure rate was 50% Now? Unemployment is 6.1%, and foreclosure rate is less that 20% It's only certain areas. GNP was increasing up until now. It may be at a standstill but it's higher than it was even though it had no activity at the moment. Without the bailout, however... Then you'd end up in the great depression. Inflation would be through the roof because interest rates would go sky high. Unemployment would be ridiculous. To buy a house you would need to put down 40% instead of 20% and have 12 months payment in the bank before they would grant you anything. So if you're looking at a 200G house, that's 80G right there. No one has that kind of money, everything would come to a grinding halt. Now... Moving on to how everyone thinks that this is the Republicans' faults... This is best summed up by an email sent to my by my mother originally written by a family friend: "Friends: Let me apologize in advance. I make it a rule to not typically hit “forward” on junk e-mails, and waste your time with such nonsense. I assure you, this is not a “forwarded” e-mail. I have been spending some time researching things and I am just so damned ticked-off and I am sick and tired of the glazed-over bull-____ that is fed to we citizens by the nightly news. Normally, I can overlook it, but when our country faces a financial melt-down of such extraordinary magnitude, (as is now the case), and the mainstream media is avoiding the “real” story, I feel compelled to speak up and at least tell my friends and family. You all know that I am an attorney. As such, I like to deal in facts. Researchable, provable, facts. You may elect to bury your collective heads in the sand and ignore the actual cause of what actually happened here, but I can’t because facts are very stubborn things and this crisis just happens to tick me off royally. Make no mistake about it. We are experiencing the current state of affairs due exclusively to politically liberal social engineering, and I for one am not afraid, and I am more than ready to stand up and proclaim that the King has no clothes. This current financial crisis all started with the Community Reinvestment Act of 1977. Look it up. This was social engineering at its worst, brought to us by Jimmy Carter. And then, as if it weren’t bad enough already, Bill Clinton in 1995 had to stick his liberal 2-cents into it as well by mandating that people who could not afford to buy a house, would be entitled to own one anyway. (look it up). Never mind that those persons were not able to re-pay their mortgage loans. Again, Social Engineering at its worst. Because of the Clinton revisions, Fannie Mae and Freddie Mac were allowed to hold just 2.5% of capital to back investments, verses the standard 10% for banks. Fannie Mae and Freddie Mac were charged with promoting that lenders (that they were backing), should make money easier to come by, specifically so that under-qualified borrowers could buy houses that they simply could not afford. Fact: Barney Frank and Chris Dodd were two of the prominent politicians who forced the issue. For over 40 years, house prices pretty closely tracked inflation, until Barney & Chris and Bubba socially engineered things. Then money got cheap, and house prices spiked. Like it or not, seeing the writing on the wall by 2003, FACT: George W. Bush tried to change it in 2003. (look it up). Bush’s attempted imposition of oversight over Fannie & Freddie would have been timely considering when the actual bubble started to inflate. Even the New York Times (no friend to the Bush administration), wrote on Sept. 11, 2003, “The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.” Guess who stopped the Bush plan…. Barney Frank and Chris Dodd. Oh, now there’s a surprise. Barney Frank then had the go-nads to publicly state: “the more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.” (that’s a quote – you can look that up too). Today, ‘ole Barney is quick to proclaim that the sky is falling, but he is equally quick to state that he was nowhere near the cause of the problem. Bull____! But the Bush attempt to fix the problem was not the last. Another fact: (look it up) On May 25, 2006, John McCain stood up on the floor of the Senate and said: “For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac--known as Government-sponsored entities or GSEs--and the sheer magnitude of these companies and the role they play in the housing market. OFHEO's report solidifies my view that the GSEs need to be reformed without delay. I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. 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. I urge my colleagues to support swift action on this GSE reform legislation. Like it or not, this guy had it nailed in 2006. Ok, so if the Bush plan wasn’t enough to alert the population that this time-bomb was coming, then John McCain’s urging should have. But what happened in 2006? The Federal Housing Enterprise Regulatory Reform Act of 2005 was killed by the democrats. I’m not making this stuff up, folks, I’m just reporting it. You can look all this stuff up. So when we sit around and hold George Bush at a 28% approval rating, … and when we even have to pause to consider whether we should vote for John McCain or Barack Obama, I have to question our collective sanity. This shouldn’t even be a horse race. How long are we going to allow this politically correct bull____ to govern our lives? Make no mistake about it – we are where we are today because the bleeding hearts who want everything to be good and kind and fair and strong and proper basic and equal, have attempted to “shame” us into thinking that if we do not take part in the political correct fanfare, we are not among the enlightened thinkers. Well, listen, with a college degree, half of a masters, and all of a juris doctorate degree behind me, I’m about as “enlightened” as I need to be. But even so, I can still see deep, messy bulls___ when I see it, and I am not afraid to call it what it is. It stinks like hell, and I for one am not going to shut up about it any longer. -Carl Spagnuolo SOURCES: Community Reinvestment Act The CRA was passed into law by the 95th United States Congress in 1977 as a result of national grassroots pressure for affordable housing, and despite considerable opposition from the mainstream banking community.[1] Only one banker, Ron Grzywinski from ShoreBank in Chicago, testified in favor of the act.[2] The CRA mandates that each banking institution be evaluated to determine if it has met the credit needs of its entire community. That record is taken into account when the federal government considers an institution's application for deposit facilities, including mergers and acquisitions. The CRA is enforced by the financial regulators (FDIC, OCC, OTS, and FRB). The bill encouraged the Federal National Mortgage Association, commonly known as Fannie Mae, to enable mortgage companies, savings and loans, commercial banks, credit unions, and state and local housing finance agencies to lend to home buyers. It also encouraged the Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, to buy mortgages on the secondary market and sell them as mortgage-backed securities on the open market.[3] Due to massive financial losses, on September 7, 2008 the Federal Housing Finance Agency (FHFA) put Fannie Mae and Freddie Mac under the conservatorship of the FHFA Clinton Administration Changes of 1995 In 1995, as a result of interest from President Bill Clinton's administration, the implementing regulations for the CRA were strengthened by focusing the financial regulators' attention on institutions' performance in helping to meet community credit needs. These revisions[5] with an effective starting date of January 31, 1995 were credited with substantially increasing the number and aggregate amount of loans to small businesses and to low- and moderate-income borrowers for home loans. These changes were very controversial and as a result, the regulators agreed to revisit the rule after it had been fully implemented for seven years. Thus in 2002, the regulators opened up the regulation for review and potential revision.[citation needed] Part of the increase in home loans was due to increased efficiency and the genesis of lenders, like Countrywide, that do not mitigate loan risk with savings deposits as do traditional banks using the new subprime authorization. This is known as the secondary market for mortgage loans. The revisions allowed the securitization of CRA loans containing subprime mortgages. The first public securitization of CRA loans started in 1997 by Bear Stearns. [6] The number of CRA mortgage loans increased by 39 percent between 1993 and 1998, while other loans increased by only 17 percent. [7] [8] Other rule changes gave Fannie and Freddie extraordinary leverage, allowing them to hold just 2.5% of capital to back their investments, vs. 10% for banks. By 2007, Fannie and Freddie owned or guaranteed nearly half of the $12 trillion U.S. mortgage market. [9] George W. Bush Administration Proposed Changes of 2003 In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." [10] This change was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mac under a new agency created within the Department of the Treasury. However, it did not alter the implicit guarantee that Washington will bail the companies out if they run into financial difficulty; that perception enabled them to issue debt at significantly lower rates than their competitors. The changes were generally opposed along Party lines and eventually failed to happen. Representative Barney Frank (D-MA) claimed of the thrifts "These two entities—Fannie Mae and Freddie Mac—are not facing any kind of financial crisis, the more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Representative Mel Watt (D-NC) added "I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing."" There you have it... NEXT Now, I am not here to tell you who to vote for, I am just justifying why I am for McCain and against Obama. I feel I have to do so as a vast majority of my peers are pro-Obama and have been ripping me a new asshole for the last few months: -1- We are working with a Democratic Congress. A Democratic president with a Democratic Congress would be a disaster. The checks and balances system would be destroyed. Every piece of pork the Democrats ran past would be put into action and the Republicans would see nothign done. That isn't fair. -2- Obama wants to initiate higher taxes in a time of a financial deficit (I would go so far as to call this a crisis now). Take from the rich and give to the poor. Robin Hood may have been a hero back in the day but today that's called Socialism. I'm a Capitalist, thanks. -3- He's very anti-off shore drilling. And his main reasoning is that we won't see the benefit for 10+ years and that it isn't a permanent solution. Well yes, but at least there will BE A BENEFIT and it's a TEMPORARY FIX until we find something better. -4- Grom what I've heard, a nice chunk of Obama's campaign money came from Fannie Mae and Freddie Mac, the two insurance companies who went tits up and took most of Wall Street with them. That was money they did not feel comfortable giving him in their current state at the time but he convinced them into giving it up. Look where that got them. -5- Obama is too inexperienced. He's all talk. Yes he has some decent idea but they're all in his head. He never acts on anything and never has even as a Senator. HOWEVER, there is one huge flaw with McCain... Sarah Palin. Now, in the beginning she seemed alright to me. I actually even kinda liked her. And then I saw the video Rachel posted a few pages back and damn near shit my pants. As a Pagan, that's pretty disturbing.
http://www.presstv.ir/detail.aspx?id=71041§ionid=3510203 Just for edible thoughts. And crimsonspirit: Thanks for the article, I appericate it, and I read it; Least most of it
Crimson, you are very smart and your post was very well written, however why the hell did you have to include such a factually inaccurate email about Barack Obama at the end? It sucks because the parts you wrote were so intelligent, and I would hate for you not to vote for him because of something someone else said. And you can tell your friend to go get their facts straight instead of spreading around classic GOP talking points. For starters, it was not Obama but McCain's top campaign manager that took money from Freddie Mac and Fannie Mae. Mr. Davis over a period of 5 years netted 30,000 a month as part of an advocacy group to protect them against stiffer regulations. It's funny now that Obama is asking for regulation, where McCain is campainging continously for de-regulation. Obama's campaign has rejected donations from lobbyists and special interest groups. His campaign has been known to refund hefty donations if it is found that the donator is connected to a lobbyist group or an oil corporation. And to top it all off? He is the first candidate in history to forego public financing (since it's been established) which means he relies solely on donations from the American people to keep his campaign alive. Nobody on his campaign, nor Obama himself have taken donations from Freddie Mac or Fannie Mae. Quite simply it is a lie, and your friend is misinformed. Furthermore, in terms of what Obama has done in the Senate? Obama has sponsored (not co-sponsored or approved) 152 resolutions. He serves on three of the four Senate Committees dealing with foreign policy issues including the Foreign Relations; Homeland Security & Governmental Affairs; & Veterans' Affairs committees & is Chair of the Foreign Relations Subcommittee on European Relations, which is responsible for U.S. relations with European countries, the European Union & NATO. Biden himself, has been in washington longer than McCain and has a load of foreign policy experience. He also is a champion for woman's rights as he sponsored the Violence Against Women Act (as Wikipedia explains the bill, "It provided $1.6 billion to enhance investigation and prosecution of the violent crime perpetrated against women, increased pre-trial detention of the accused, provided for automatic and mandatory restitution of those convicted, and allowed civil redress in cases prosecutors chose to leave unprosecuted."). And both are for a woman's right to choose. And as for the lie about taxes? Let me make something clear. Obama would only raise taxes on you if you made over 240,000 a year. That is a quarter of a million dollars. If you're below that you would not see really any change under Barack Obama's plan, and even further...he is looking to give tax cuts to working class families and take away some of the ones given by the current adminstration to wealthy individuals and big corporations. McCain doesn't want to change that...he wants to continue those very same economic policies. Normally, with McCain's experience I'd trust him on that but he has said numerous times, and I quote “The issue of economics is not something I’ve understood as well as I should,” and yet we're supposed to trust him to get us out of this mess? Quite simply, I've said before I think you're a good person Crimson, and your intelligence blew me away in that post...but if you're not going to vote for someone for certain reasons, please at least make sure your candidate isn't the real guilty party (fannie mae, tax cuts for the wealthy etc). I just think it'd be a disappointment to see you vote for McCain just because you believed the lies your GOP friends shoved at you.
Thanks for that post, Derek. Pretty informative. I'm more of a lurker in this thread, so for now I only want to touch on one point. I also respect Crimson's post, but I have one question off the top of my head: Didn't we just have this scenario with Republicans for several years? Something like two terms, at least?
Yup. Up until recentely the Republicans had a majority in the House and Senate. So that meant every piece of "pork" or BS legislation that Bush and the Republicans sponsored, went through with almost no opposition.
I thought so. So 'fairness' in that area can't really be a point of contention. Man, I'm excited to watch the debate tonight.
What struck me was that she was NOT making a fool of herself. I'm sort of shocked here. She came out full force to fight tonight and boy did it show. This was not the same Sarah Palin from the Katie Couric (sp?) interview. Strange how that was. I am extremely disappointed in Joe Biden. I feel he did not answer most of the given questions properly at all. I was expecting him to blow Sarah Palin out of the water, but it seems like she was the one who was capitalizing and that makes me extremely upset. Totally not expecting this at all. I definitely feel like she won this debate and I'm sure it will have a positive effect for the McCain/Palin campaign. (I seriously just cringed typing that.)
She is a joke. It's a shame that the voters who are voting for McCain are not realizing this. It just irks me. I'll give her credit for tonight's debate, but I fear what lies ahead if McCain/Palin are in the White House.
So polls are showing that Biden faired better in the debate. Wow, lol. I guess maybe my opinion is wrong, but I'm going to stick with it.
Biden didn't lose, And Palin didn't win. None of them did. And I'll get to that, but first: The problem is with Palin is that her performance was incredibly rehearsed and that's why she seemed like she did well. All I heard the entire night was the same tried and true GOP talking points (including the lie about Obama's tax plan that has been debunked so much it is pathetic) and little to no information or substance in her answers. Biden only came off boring because he didn't repeat talking points and instead answered the questions honestly and touted his experience. I thought he attacked her very good without being condenscending and judging by the poll numbers....voters seem to agree with me. However, his answers were too lengthy and he didn't seem to have the same fire as Palin did in her responses. He suffered from what many people criticized him for in the democratic debates, and that was his inability to give a short answer. He often went on until the light flashed which forced him to come to an abrupt stop. So that's where he failed the most. But none of them won handily and this is not bound to change anything about the race. I mean look...Andrea...Palin hugely exceeded my expectations too, but believe me when I say I do not believe this was the 'knockout' performance she needed to have to sway the momentum of the race. Yes she did well, but as CNN so aptly put it "many jabs were thrown, but no knockouts were landed in this debate". If anything it was a draw. Nobody knocked out anybody.
=\ Over the bailout, why is it suddenly called "Rescue bailout" or something? Why is anyone FOR IT? Bush concocted it and supports it and something must be fishy about it. Sure it might fix the economy temporary but in the end be off worse without knowing.