Archive for the ‘Mortgage Crisis’ Category
Posted by iusbvision on August 9, 2011
In Reckless Endangerment, Gretchen Morgenson, the star business columnist of The New York Times, exposes how the watchdogs [Barney Frank & Chris Dodd] who were supposed to protect the country from financial harm were actually complicit in the actions that finally blew up the American economy.
Drawing on previously untapped sources and building on original research from coauthor Joshua Rosner—who himself raised early warnings with the public and investors, and kept detailed records—Morgenson connects the dots that led to this fiasco.
Morgenson and Rosner draw back the curtain on Fannie Mae, the mortgage-finance giant that grew, with the support of the Clinton administration, through the 1990s, becoming a major opponent of government oversight even as it was benefiting from public subsidies. They expose the role played not only by Fannie Mae executives but also by enablers at Countrywide Financial, Goldman Sachs, the Federal Reserve, HUD, Congress, the FDIC, and the biggest players on Wall Street, to show how greed, aggression, and fear led countless officials to ignore warning signs of an imminent disaster.
Many IUSB Vision readers will remember substantive multi-part analysis which had gone viral on the internet with some of our posts on the subject still getting hundreds of hits per day; these posts being the most popular – HERE, HERE, HERE, HERE, HERE, HERE, HERE, HERE and HERE.
Last year famed economist Dr. Thomas Sowell published his best-selling tome of the mortgage collapse Housing Boom & Bust which told what happened in an analysis that very closely matched ours. Some of our critics might say that this is no surprise because the editors of this website and Dr. Sowell are very like-minded, but the critics did not expect Reckless Endangerment.
This new book from the New York Times business columnist also tells the story almost point per point as we told you right here at IUSB Vision, with the exception of how we saw the modification of Glass-Steagal with the Gramm-Leach-Bliley bill. Partisan leftist Robert B. Reich’s review of this book tells several important parts of the same story that we did (and I am sure he didn’t like it), and The American Interest says that Reckless Endangerment could bring about the end of the Democratic Party itself.
Campus leftists who said that our analysis of the mortgage collapse was just partisan rhetoric can stick this in your pipe and smoke it. Our analysis has been confirmed by sources from the left and right, as well as financial publications such as the Wall Street Journal, Investors Business Daily, Forbes etc. While the New York Times took a different view during the campaign season to help the Democrats, outside of the campaign season the NYT has done some top rate analysis on this issue which they deserve credit for. We told you in our analysis that the New York Times predicted in 1999 that this collapse could happen and published the Republican attempts to fix the problem since 2001.
We have been vindicated. As IUSB Vision Editor I also feel vindicated as I spent countless hours of research and sleepless nights to bring you such an accurate analysis early on in the collapse. We are pleased that our analysis has stood the test of time and is still considered one of the best abridged online sources of this crisis available on the internet.
Here is a 30 minute interview with Dr. Sowell on Housing Boom & Bust which we believe is a must see to get insight on the issue –
Posted in Chuck Norton, Click & Learn, Economics 101, Mortgage Crisis | Leave a Comment »
Posted by iusbvision on May 16, 2011
… all because this policy worked out so well the last time right?
[LINK – start at the bottom of the linked page and start reading to get a great education on the mortgage crisis. It started with the abuse and deliberate misapplication of redlining regulations to accomplish political goals and economic social engineering. When the OFHEO regulator tried to warn Congress Democrats like Barney Frank and Chris Dodd insisted that the regulator was lying and even used the race card against them, of course the worst economy since the Great Depression has shown us that everything wasn’t fine – Editor]
Via Weasel Zappers and Business Week:
(Business Week) — Community activists in St. Louis became concerned a couple of years ago that local banks weren’t offering credit to the city’s poor and African American residents. So they formed a group called the St. Louis Equal Housing and Community Reinvestment Alliance and began writing complaint letters to federal regulators.
Apparently, someone in Washington took notice. The Federal Reserve has cited one of the group’s targets, Midwest BankCentre, a small bank that has been operating in St. Louis’s predominantly white, middle-class suburbs for over a century, for failing to issue home mortgages or open branches in disadvantaged areas. Although executives at the bank say they don’t discriminate, Midwest BankCentre’s latest annual report says it is in the process of negotiating a settlement with the U.S. Justice Dept. over its lending practices.
Lawyers and bank consultants say regulators and the Obama Administration are scrutinizing financial institutions for a practice that last drew attention before the rise of subprime lending: redlining. The term dates from the 1930s, when the Federal Housing Administration drew up maps using red ink to delineate inner-city neighborhoods considered too risky for lending. Congress later passed laws banning lending discrimination on the basis of race and other characteristics. “The agencies have refocused on redlining because, in the wake of the subprime explosion and sudden implosion, they are looking at these disadvantaged neighborhoods and not seeing any credit access,” says Jo Ann Barefoot, co-chair at Treliant Risk Advisors in Washington, D.C., which consults with banks on regulatory issues.
The 1977 Community Reinvestment Act (CRA) requires banks to make loans in all the areas they serve, not just the wealthy ones. A Bloomberg analysis found the percentage of banks earning negative ratings from regulators on CRA exams has risen from 1.45 percent in 2007 to more than 6 percent in the first quarter of this year.
Posted in 2012 Primary, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration, Stuck on Stupid | Leave a Comment »
Posted by iusbvision on May 13, 2011
You Promised To Save Millions From Foreclosure Yet Your Housing Program Was A Failure And Now The Housing Market Is In The Midst Of A “Double Dip.” Why Has Your Administration Largely Ignored Struggling Homeowners?
PROMISE: President Obama Promised That His Housing Program Would Prevent 7 to 9 Million Families From Foreclosure. “And we will pursue the housing plan I’m outlining today. And through this plan, we will help between 7 and 9 million families restructure or refinance their mortgages so they can afford—avoid foreclosure.” (President Barack Obama, Remarks On The Home Mortgage Industry In Mesa, Arizona, 2/18/09)
Only One In Four Of 2.7 Million Homeowners Seeking Assistance From Obama’s Mortgage Relief Plan Succeeded In Getting Their Payments Reduced. “Just one in four of the 2.7 million homeowners who sought to participate in the Obama administration’s signature mortgage assistance program have succeeded in getting their monthly payments reduced.” (Alan Zibel and Louise Radnofsky, “Only 1 In 4 Got Mortgage Relief,” The Wall Street Journal, 2/28/11)
Inspector General Neil Barofsky, Who Oversaw HAMP, Said That The Program “Continues To Fall Short Of Any Meaningful Standard Of Success.” “The program has faced sharp criticism. Neil Barofsky, the departing special inspector general overseeing the program, has faulted the administration for launching it with inadequate analysis and only partially developed guidelines. This led to delays and confusion, and the program ‘continues to fall short of any meaningful standard of success,’ he said a report released in January.” (Alan Zibel and Louise Radnofsky, “Only 1 In 4 Got Mortgage Relief,” The Wall Street Journal, 2/28/11)
“It’s Official. Home Prices Have Double Dipped Nationwide, Now Lower Than Their March 2009 Trough, According To A New Report From Clear Capital.”(Diana Olick, “National Home Prices Double Dip,” CNBC, 5/5/11)
“Home Values Posted The Largest Decline In The First Quarter Since Late 2008, Prompting Many Economists To Push Back Their Estimates Of When The Housing Market Will Hit A Bottom.” (Nick Timiraos, “Home Market Takes A Tumble,” The Wall Street Journal, 5/9/11)
The Oregonian: “Economists Who Once Predicted That Prices Would Bottom Out Sometime This Year Now Are Saying, Well, Maybe In 2012.” “Lenders have filed more than 300,000 foreclosures against American families every month for almost two years. As long as that’s occurring, the housing numbers will stay bleak. Home prices nationally have fallen for 57 consecutive months. … Economists who once predicted that prices would bottom out sometime this year now are saying, well, maybe in 2012. ” (Editorial, “American Housing: Underwater And Still Sinking,” The Oregonian, 5/9/11)
Posted in 2012, Campaign 2008, Chuck Norton, Corporatism, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on March 22, 2011
UPDATE – Steven Lerner, the man in the video overtly plotting a new economic crisis, has visited the White House four times as well as the Treasury Department!!!
Steve Lerner SEIU
Watch this video:
Longer tape of this conversation:
Transcript and full article at Business Insider:
CAUGHT ON TAPE: Former SEIU Official Reveals Secret Plan To Destroy JP Morgan, Crash The Stock Market, And Redistribute Wealth In America
A former official of one of the country’s most-powerful unions, SEIU, has a secret plan to “destabilize” the country.
The plan is designed to destroy JP Morgan, nuke the stock market, and weaken Wall Street’s grip on power, thus creating the conditions necessary for a redistribution of wealth and a change in government.
The former SEIU official, Stephen Lerner, spoke in a closed session at a Pace University forum last weekend.
UPDATE I – Glenn Beck: This is a clear case of economic terrorism – LINK.
UPDATE II – SEIU sued under RICO statute (Via The Blaze):
Cockroaches, bugs, mold, and flies. These are just some of the props and rumors allegedly employed by the Service Employees International Union (SEIU) against the American unit of French catering company Sodexo. And the company’s had enough.
Fed up with tactics that include intimidation, extortion, and yes, sabotage that apparently includes plastic cockroaches, Sodexo filed a lawsuit against the SEIU last week under the Racketeering Influenced and Corrupt Organizations (RICO) Act.
“We work constructively with unions every day but the SEIU has crossed the line by breaking the law,” Robert Stern, general counsel for Sodexo USA, said in a statement. “We will not tolerate the SEIU’s tactics any longer.”
SEIU has been fighting to represent 80,000 hourly Sodexo employees, which is above and beyond the 180,000 hourly employees who are already union members. The union regularly stages protests against the company to make its point, like this one last fall on the campus of George Mason University. The video alleges SEIU bused in protesters, who can be heard chanting, among other things, “As long as it takes, whatever it takes, we’ll be in your face!”
Sodexo’s complaint, filed in federal court in Alexandria, VA, alleges acts of SEIU blackmail, vandalism, trespass, harassment, and lobbying law violations designed to steer business away from, and harm, the company.
And just what exactly might those acts look like? Sodexo gives the details:
The complaint alleges that the SEIU, in face to face meetings, threatened Sodexo USA’s executives that it would harm Sodexo USA’s business unless they gave in to the union, and then carried out its threats through egregious behavior, including:
- throwing plastic roaches onto food being served by Sodexo USA at a high profile event;
- scaring hospital patients by insinuating that Sodexo USA food contained bugs, rat droppings, mold and flies;
- lying to interfere with Sodexo USA business and sneaking into elementary schools to avoid security;
- violating lobbying laws to steer business away from Sodexo USA, even at the risk of costing Sodexo USA employees their jobs; and
- harassing Sodexo USA employees by threatening to accuse them of wrongdoing.
The complaint, filed in federal court in the Eastern District of Virginia, seeks an injunction against the SEIU and its locals and executives, as well as monetary damages to be determined by the court.
UPDATE III – Member of Congress to Attorney General Eric Holder – LINK.
Posted in Chuck Norton, Dirty Tricks, Economics 101, Mortgage Crisis, Unions | Leave a Comment »
Posted by iusbvision on March 9, 2011
How long have we said that the mortgage crisis has been used to primarily as an excuse for a power grab, with a distant second being helping out those who could use some help?
Of course one of the reasons there are so many empty homes on the market is because the Democrat’s mortgage plans were a failure if you view the top goal as helping out people with at risk loans. If you view them from the primary purpose of a power grab they are a smashing success.
We have been saying this since February 3rd. Obama’s mortgage plan wasn’t serious and would help very few. Anyone who wanted to seriously tackle the economy needed to have a plan for the toxic assets, keep mortgage holders in their homes and get housing prices to steady. Obama’s plan wasn’t designed to even do that and the economy has continued to suffer for it.
The administration managed to drastically cut down the number of banks. Wealth consolidation is important for the left because the fewer people that have it and control it the easier it is to control that wealth and engage in social engineering. This was done by not suspending the mark to market rule so that mortgage securities would have to be counted as worthless even though that had homes standing besides them, abuse of regulatory enforcement was another method, and another method was the selective use of the buying of bank stocks and issuance of bailout funds. For example: Bank A would get bailout, bank B would not. Bank A buys bank B. Bank A gives money to ACORN or another Obama political ally. The financial reform bill was a massive power-grab as we have recently covered. This is not conspiracy stuff folks. This is history.
Since that February 3rd article we have covered this story repeatedly and told you how the mortgage crisis was being prolonged as an excuse to gain control of the banks. [LINKS 1, 2, 3, 4, 5, 6, 7, & 1, 2,]. Examination of these links shows we started reporting this before Fox, CNBC’s Rick Santelli and Jim Cramer. [Gratuitous self promotion – why not /wink – editor]
Think about it folks. I will ask this question again. We are over two years into the Obama presidency and since the 2008 campaign everyone has said that priority one for getting the economy back in place is dealing with the toxic assets and at risk mortgages to keep people in their homes and stabilize the housing market. It still has not been done. WHY?
Now we might not be able to afford it even if we wanted to. The housing market is now in a double dip.
Is the Bail-out mismanagement just a way to nationalize the banks?
Dick Morris – Obama to troubled home owners: Your out of luck
Clinton Political Strategist Dick Morris: Clinton’s Economic Vision vs. Obama’s
Treasury unveils proposed legislation to seize companies. Morris: This is a plan to nationalize the banks.
Cramer and Morici – Why the Stimulus and Obama’s Mortgage Plan Won’t Work.
Bloomberg: Government has spent 12.8 Trillion buying up/shoring up banks. Still no mortgage help.
Daughter of laid-off worker: Obama where is the help you promised in the campaign?
Posted in 2012, Campaign 2008, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on December 31, 2010
Of course – Dr. Williams is black. That means if you don’t agree with him you are automatically a racist. Just ask ABC News.
Posted in Campus Freedom, Indoctrination & Censorship, Chuck Norton, Click & Learn, Corporatism, Economics 101, Mortgage Crisis | Leave a Comment »
Posted by iusbvision on October 24, 2010
Its Obama Economic Advisor Austan Goolsbee vs. Bush Economic Advisor Keith Hennessey
First of all neither side represents their case very well. Goolsbee omits key facts and represents the graph in a misleading way. To Hennessey’s credit he points this out, but Hennessey fails to point out a key economic points and two of the Obama Administrations glaring fallacies. Hennessey overlooks some great and legit opportunities for good refutation here, which is why I have said that the Bush Administration had a terrible communications machine.
I sent this note to Austan Goolsbee on his youtube channel:
Austan – with all due respect. When there is a large shock to the economy you see the pattern that you have on the board. It falls to bottom, recovers some and then starts to level off. The same pattern on your board would have happened if you did nothing. You know this as well as anyone. In fact nothing would have been better than the uncertainly the leadership has created. You also left out that we need 1.5% growth just to absorb new young people coming into the job market. – cont –>
Austan – lets talk about what policies got us here. In 1999 the NYT warned about a possible collapse in the mortgage industry. In 2001 the Bush Admin and a group of GOP Senators led by Sunnunu and? Dole started introducing bills for mortgage reform. Dems in the? Senate used the filibuster and other tools to prevent passage year after year. OFHEO warned Congress that real reform was needed, Democrats called them names. Obama and Dodd took huge $ from Fannie Mae to keep the status quo. [See our Mortgage Crisis category for the evidence – Editor]
There is a second reason why Goolsbee keeps the graph he shows to such a short amount of time. The economic performance pattern of Goolsbee’s graph looks similar to this:
This is the pattern that is typical of what happens when an economic shock hits the economy. First you see the sharp fall. The damage starts to slow down as the economy starts to regain its footing after the slide down and if uncertainty or bad policies continue the economy basically flat-lines as it is now. As confidence is restored the economy starts to grow and jobs are created. But in a bad case if the government does NOTHING this is the worst pattern you will normally expect to see.
Hennessey forgets to point out that the Obama Administration promised that if it got the stimulus, the follow up porkulus bill and the rest of the spending, as is consistent with socialist Keynesian economic theory, that unemployment would not raise higher than 8.5%. Of course unemployment soared past 10% with the passage of all those bills. The problem is that governments and politicians don’t spend money for economic reasons they spend it for political reasons and new rules tend to be onerous, undermine certainty and help pick winners and losers with the winners sending money back to those in power – Corruption: Stimulus Funds Spent in Democrat Districts…
Obama touted his policy as something akin to FDR’s New Deal, but due to the regulatory uncertainty and the inability of “central planners” to adequately manage a large economy non farm unemployment never dropped below 20% during the New Deal. WWII ending the New deal is what rescued the economy and at the end of 1946 government spending dropped massively and economic growth followed.
Remember, once certainty is restored the economy will grow again instead of flat-line. The truth is that current economic policies are hindering job growth. No one knows what their taxes are going to be, no one knows the entire effect of ObamaCare, the EPA is threatening to regulate carbon all by itself if Congress doesn’t pass cap & tax. Obama is also waging war against small business with his rhetoric and the attacks of the Chamber of Commerce and the NFIB. Is that the kind of environment you would hire or take other measured risks in? This is why I said that if the government did not do stimulus, porkulus, most of the bailouts, ObamaCare, all the new regulations and taxes the economy would be doing better because there would be a great deal more regulatory certainty. There are, of course, many smart incentives the government could have done to help get certainty and economic growth going, but that is not the nature of the far left. The result of bad policy is unemployment that has flat-lined at over 9.5% for 14 months.
Once again a Bush Administration official like Hennessey fails to point out that the Bush Administration fought for mortgage reform year after year after year while Fannie Mae and Freddie Mac used YOUR money to line the pockets of Democrats to the tune of $200 million to preserve the status quo (with Chris Dodd and Obama receiving the largest amounts of cash); not to mention the $90 million that went to Frank Raines and the other tens of millions that went to other Democrat appointees who took jobs at Fannie Mae such as Johnson and Gorelick.
“The Forgotten Deprerssion” and How President Coolidge & Harding Turned America Around. Glenn Beck, Reagan Budget Advisor Art Laffer, and Chris Edwards from the CATO Institute.
Posted in 2012, Chuck Norton, Economics 101, Energy & Taxes, Mortgage Crisis, Obama and Congress Post Inaugration, True Talking Points | 1 Comment »
Posted by iusbvision on September 13, 2010
At least Austan Goolsbee admits that unemployment will stay high, but that is where the directional truth from him ends.
GOOLSBEE: But I don’t think the unemployment rate will be coming down significantly anytime in the near future.
Political communication needs to be what I call “directionally accurate” that means that it cannot attempt to create a false narrative or picture even if some of the stats presented are accurate. Spinning a half truth amounts to a lie in the book of most people.
1 – Goolsbee tries to tell us about the number of jobs the “stimulus” saved or created, but Wallace points out that much of that number is based on a an economic model (a simulation or prediction) and not hard data.
Most of the jobs “preserved” by the stimulus package were temporary jobs that were extended for a time or government jobs and often they amounted to hundreds of thousands of dollars per job, but this writer as well as many others have shown that. Many of the jobs they “created” never existed and in some cases so outrageous as to claim that if a man cleaned up a mess that was “creating a job”. So much was fraudulent that the Washington Examiner had to create the “phony stimulus map” and a database of media reports reporting the errors. Note – Notice at about 6:10 in the interview Goolsbee says that his numbers include the reports of those who received stimulus money, most of whom are political allies as you will see in the links below. These are the bogus numbers that so much of even the elite media has reported on in the phony stimulus map, and those are just the phony ones that people were able to catch.
Recovery.gov shows money flowing to nonexistent districts
Corruption: Stimulus Funds Spent in Democrat Districts…
Porkulus job fables in Michigan
2 – Goolsbee tries to tell us that when Joe Biden said that we were going to have “Recovery Summer” it did not mean that the economy would recover, he meant that more projects would be done with the “Recovery Act”. This is laughable and Wallace did not let him get away with it. While they did highlight some of the projects funded by it, the narrative that the economy would rebound over the summer was crystal clear. Ask the converse, did they tell us that we would not see improvement over the summer? The second quarter economic growth numbers were just revised down to 1.6% and much of that was debt spending by the government. By contrast the first year after the Reagan Economic Recovery Plan was implemented the economy grew by 8%.
3 – Goolsbee then says that most economists say that the stimulus worked. Oh really? That is not what the National Association for Business Economics. who creates what is called the NABE Index had to say in mid April: Profiles in the Obvious: New Survey of Economists Says Stimulus Bill Didn’t Work. Now keep that mid April date in mind as we continue.
4 – Goolsbee (at about 6:22 in the video) said that the economy was way ahead of where economists thought we would be at point after point. This is demonstrably false, so false that it is safe to just call it out as a not just a lie, but a whopper of a lie. Since most groups of economists are Keynesians most economic groups that the elite media went to thought all along said that the bad economic news was unexpected or a surprise. They said this month after month for over a year until mid April when it was so obvious that the stimulus had failed and they started reversing themselves.
This web site, HotAir, and so many others cataloged what the elite media and the economists they interviewed said month after month and the following is just a small sample:
Elite Media: Job Losses “Unexpectedly” High Again for how many months now?
Housing Down Again 11%, Consumer Confidence Down, Underemployment Up, Elite Media “Surprised” Yet Again that Unemployment Claims Rise..
Elite Press Still Spinning Bad Economy for Obama – “Unexpected Growth in Job Loss” – Oh Really?
Administration playing games with unemployment rate; elite media covering for them. BIG UPDATE!
439,000 new jobless claims, media spins it as positive news (again)
Take a look at this Google link of how our friend at HotAir cataloged the “expected” bad economic numbers .
5 – At 7:20 the tax cuts conversation begins and so does the spin from Goolsbee. Remember that Obama repeatedly blamed the tax cuts for causing the mortgage collapse (you having more of your own money somehow cause Fannie Mae to buy up those high risk loans and you having your money somehow caused them not to pay their own mortgage – good luck following the logic on that talking point) and are now talking about extending them.
This is where again Gollsbee gets pretty dishonest.
Wallace points out that the taxes that would be raised on the “so-called wealthy” are actually small businesses and sub s corporations such as the mom and pop pizza bizz that has two or three shops who turn around and put most of that money back into the business. Very few people actually make wages as regular people understand them for over $250,000 a year.
Goolsbee accuses Wallace of being ” highly misleading” saying that 97% of small businesses are unaffected by raising the top marginal rate. Umm 95% of small businesses are 1 man operations, businesses that exist on paper for tax benefits (ie John Edwards) and/or businesses that operate at a loss. The small businesses that have between a few dozen to a few hundred employees; meaning the ones that do over 75% of the hiring in this country are the ones that will get hit hard by these tax increases.
Goolsbee sits there and talks about millionaires and billionaires as if it is the “rich” he is out to tax. The truth is that Democrats have never gone after that crowd and won’t (these people fund the Democratic Party and its 527 groups like Moveon.org and Tides Foundation money that funds ACORN and the APOLLO Alliance etc). The John Kerry’s and George Soros’ of the world benefit from a tax code that declares most of their income to be “unearned income”, meaning that their income is not taxed at nearly the same level as people who work for a paycheck or run small businesses. For example, in 2003 John Kerry made $5, 072,000 and had a federal tax burden of about 12.34% because much of his income is considered non-taxable.
Goolsbee’s policies are designed to screw the middle class buy going after the people who supply most of the paychecks.
Wallace was wrong about the 13% tax increase as he left out some of the taxes that are going up.
NY Post: Small Businesses Facing 25% Tax Hike:
Jobbing small business
The 26 million small businesses in the US — like Eneslow Shoes, headed by CEO Robert Schwartz— are getting buried under an avalanche of new taxes, which include:
* An increase of 4.6% in federal taxes from 35% to 39.6% (expiration of Bush tax cuts)
* An increase in capital gains taxes from 15% to 20% (expiration of Bush tax cuts)
* A new tax of 3.85% on investment income, dividends, rents, royalties mandated in the new health care bill
* An increase in the Medicare payroll tax to 2.35% as mandated in the new health care bill
America’s jobs growth engine is being choked to death.
A record 25 percent increase in the taxes against US small businesses — from costs associated with new health care law, to an increased Medicare tax, increased capital gains taxes and higher state and city taxes — is repealing any ability of these entrepreneurs to add jobs to their payroll.
And the numbers for New York’s small- to medium-sized business are just as harrowing.
By one estimate, the effective tax rate on the 26 million small businesses across the country — which in the past have accounted for more than half of the job growth in the US — has jumped to 50 percent from 40 percent, sucking valuable cash from the businesses.
These dollars could have been used to add to payrolls or make capital improvements — but instead will be siphoned off by Uncle Sam, state and municipal governments.
“The impact of these higher taxes and reduced hiring will be a recovery cycle that will be much longer, be slower to take hold and be without much job growth,” said Al Angrisani, founder and CEO of Angrisani Turnarounds and former US Assistant Secretary of Labor under President Reagan.
Posted in 2012, Campus Freedom, Indoctrination & Censorship, Chuck Norton, Economics 101, Energy & Taxes, Mortgage Crisis, Obama and Congress Post Inaugration, True Talking Points | 1 Comment »
Posted by iusbvision on June 26, 2010
I know all the arguments for cutting off the benefits and under a normal recession under normal circumstances I would agree. This recession is different and for now the old rules do not apply and I will explain why.
While it is true that most people find jobs shortly before their benefits expire this recession is so different that this rule doesn’t really apply.
While it is true that deficit spending is at an all time high, cuts should be made in government to pay for this
So what is different?
First of all this recession is all but entirely government orchestrated.
It was government that abused the CRA to pressure banks to make bad loans.
It was the Federal Reserve who kept interest rates artificially low for political purposes.
It was government who enforced that idiotic mark to market rule.
It was government who put all of those corrupt Democratic appointees in Fannie Mae and Freddie Mac.
It was Fannie and Freddie who bought every lobbying firm in DC to keep it from being opposed.
It was Fannie and Freddie who bought up bad loans as many as they could find and issued government backed mortgage securities on those bad loans.
It was government who started nationalizing business, made war on bond holders, engaged in Chicago style regulation , started bribing members of Congress with our money and passed bills like ObamaCare that put a huge tax on every employee hired.
It is government that destroys confidence and raises fears of regulatory uncertainty with the ridiculous new financial regulation bill, cap and tax etc etc.
It is government who blocked mortgage reform in the Senate time and time again (Democrats).
It was government who destroyed confidence with the stimulus package failure.
It is government that is arbitrarily trying to stop offshore drilling.
It is government that is actively preventing states and foreign countries from helping with the oil spill.
It is government that is threatening to let old tax cuts expire; undermining confidence.
It is the cost of government that is sending wealth and production overseas.
It is government who has employers and investors scared to death. Investors don’t want to invest here and employers are afraid to hire and when jobs do open many more people apply for them than can ever be hired.
It is government employees who make between 30-300% more than their private sector counterparts so that government has been largely shielded from the recession.
As sure as BP must pay the bill for the oil cleanup it is government that must pay for causing this financial crisis. Not enough jobs are being created to keep up with people entering the economy now.
Confidence is not going to even start trickling back in till the GOP has the Congress so that it can stop Obama and the Democrat leadership cold. Unemployment benefits are going to have to be extended at least until that time. Confidence and thus hiring, production and investment cannot begin in earnest until the world knows that the agenda of this administration and Nancy Pelosi is effectively stopped.
Posted in 2012, Chuck Norton, Economics 101, Energy & Taxes, Health Law, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on June 25, 2010
Go back in our mortgage crisis category and you can see that this is exactly what we predicted.
Housing Market Still a Disaster
Posted in 2012, Chuck Norton, Economics 101, Mortgage Crisis | 1 Comment »
Posted by iusbvision on May 10, 2010
Here is your government sponsored enterprise at work which gave fat bonuses to its political appointee execs.
WASHINGTON (AFP) – – Troubled US government-backed mortgage firm Freddie Mac on Wednesday asked for an additional 10.6 billion dollars from the Treasury Department to cover losses.
Announcing a 6.7 billion dollar loss in the first quarter, Freddie Mac said it would need the new funding by June 30 this year.
The Washington-area company has already received more than 50 billion dollars in taxpayers cash to cover losses from toxic assets.
It warned that further demands would be on the way: “Freddie Mac expects to request additional draws,” the firm said in a statement.
“The size and timing of such draws will be determined by a variety of factors that could adversely affect the company’s net worth.”
In 2008, the government pledged to ensure that Freddie Mac, and its larger sister organization Fannie Mae, kept a “positive net worth.”
The deal was designed to prop up the vital US housing market from collapsing totally and pushing the economy over the precipice.
But in a sign that the US housing sector is still in difficulty, Freddie said the percentage of its loans not paid on time or in full rose to 4.13 percent in the first three months of the year.
In the final three months of last year the rate stood at 3.98 percent.
Posted in 2012, Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »
Posted by iusbvision on April 22, 2010
We all want to see some better policing of the financial sector and some enforcement of good faith laws, but this bill invites corruption, kick backs and special favors.
Institutionalizing Crony Capitalism
By Sarah Palin
In the wake of the recent financial meltdown, Americans know that we need reform. Not only have many individuals learned lessons about personal responsibility through this, but we’ve been able to engage in a discussion about government’s appropriate role.
The current debate over financial reform demonstrates what happens when political leaders react to a crisis with a raft of new regulations. First off, the people involved in writing government regulations are often lobbyists from the very industry that the new laws are supposed to regulate, and that’s been the case here. It should surprise no one that financial lobbyists are flocking to DC this week. Of course, the big players who can afford lobbyists work the regulations in their favor, while their smaller competitors are left out in the cold. The result here are regulations that institutionalize the “too big to fail” mentality.
Moreover, the financial reform bill gives regulators the power to pick winners and losers, institutionalizing their ability to decide “which firms to rescue or close, and which creditors to reward and how.” Does anyone doubt that firms with the most lobbyists and the biggest campaign donations will be the ones who get seats in the lifeboat? The president is trying to convince us that he’s taking on the Wall Street “fat cats,” but firms like Goldman Sachs are happy with federal regulation because, as one of their lobbyists recently stated, “We partner with regulators.”
They seem to have a nice relationship with the White House too. Goldman showered nearly a million dollars in campaign contributions on candidate Obama. In fact, J.P. Freire notes that President Obama received about seven times more money from Goldman than President Bush received from Enron. Of course, it’s not just the donations; it’s the revolving door. You’ll find the name Goldman Sachs on many an Obama administration résumé, including Rahm Emanuel’s and Tim Geithner’s chief of staff’s.
We need to be on our guard against such crony capitalism. We fought against distortion of the market in Alaska when we confronted “Big Oil,” or more specifically some of the players in the industry and in political office, who were taking the 49th state for a ride. My administration challenged lax rules that seemed to allow corruption, and we even challenged the largest corporation in the world at the time for not abiding by provisions in contracts it held with the state. When it came time to craft a plan for a natural gas pipeline, we insisted on transparency and a level playing field to insure fair competition. Our reforms helped reduce politicians’ ability to play favorites and helped clean up corruption. We set up stricter oversight offices and ushered through a bi-partisan ethics reform bill. Far from being against necessary reform, I embrace it.
Commonsense conservatives acknowledge the need for financial reform and believe that government can play an appropriate role in leveling the playing field and protecting “the dynamism of American capitalism without neglecting the government’s responsibility to protect the American public.” We’re listening closely to the reform discussion in Washington, and we know that government should not burden the market with unnecessary bureaucracy and distorted incentives, nor make a dangerous “too-big-to-fail” mentality the law of the land.
Posted in 2012, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »
Posted by iusbvision on April 21, 2010
Read carefully –
In this scene Sean has just played a clip from a new DNC attack ad that blamed the mortgage crisis on John McCain. Of course McCain was part of a team of GOP Senators who tried to get mortgage reform done since 2003 and the Democrats filibustered it including Barack Obama.
Democrat talking head Julie Menin (not wishing to defend such a preposterous ad) then blames Republicans for “chipping away” at the Glass-Steagall Act for the crash. This is a lie. The changes that were made to Glass-Steagall were fully bi-partisan (38 Democrat Senators voted for the changes), fully supported by Bill Clinton and the changes were made to make our banking laws more in line with the rest of the world. It was by no means the mass deregulation Democrats are now saying it was.
Bill Clinton rightly said that the reforms helped because they allowed some healthy banks to buy out weaker banks so that the Fed and the government wouldn’t have to (WSJ Oct. 1, 2008 and HERE).
So after being called on falsely blaming Republicans, Julie Menin then criticizes the Republicans for always trying to place blame… EXCUSE ME JULIE – The DNC attack ad tried to put the blame on McCain and JUST SECONDS AGO you just tried to put the blame on Republicans for a good bill that was fully bi-partisan. Menin performed an instant hypocritical 180 degree reversal as smooth as silk.
See how quickly she changed the subject and moved the goalpost? From the DNC ridiculously blaming John McCain, to falsely blaming a good bipartisan law on Republicans, to “Hey lets not put blame”, to “the GOP is the party of NO and has no solutions” when it was the GOP who worked to get mortgage reforms passed year after year with Democrats fighting for the status quo.
UPDATE – Here is McCain on the record in 2008 about these same bogus accusations –
Posted in 2012, Campaign 2008, Chuck Norton, Mortgage Crisis, True Talking Points | 1 Comment »
Posted by iusbvision on April 21, 2010
Paul Ryan and the financial pro’s at CNBC tell you the exact same story we have been telling you for over a year. Much of this regulation in government is not designed for the safety and benefit of the public. It is designed to create “Crony Capitalism” to use regulation and policing to tip the scales of competition; to pick winners and losers while politicians get rich and you and I lose.
Another term for this type of corrupt behavior is “political market economics”. Another term os “corporatism”. Another term is fascism, but most people have stopped using this term because of its pajorative baggage.
Real Capitalism vs. Political Market Capitalism
Corporatism in action: Feinstein routes government money to firm doing business with husband – UPDATED!
Fallacy upon fallacy, ignorance upon ignorance…
Crony Capitalism – Obama’s Legacy
Posted in 2012, Campaign 2008, Chuck Norton, Economics 101, Mortgage Crisis | 2 Comments »
Posted by iusbvision on April 20, 2010
We have said this since the scandal broke. In fact if you go back to the earliest posts of our mortgage crisis coverage you wills ee that we were saying this before some of the big newspapers. Today the Wall Street Journal gives us a much-needed reminder of recent history.
By the way Democrats in Congress made sure that Fannie Mae got millions in bonuses with our money.
Transparency, Congress & Corruption: AIG and Fannie Mae Bonuses
Fannie Mae and Freddie Mac paying $210 million in bonuses with your money and no outrage why…..
Wall Street Journal:
Now that nearly all the TARP funds used to bail out Wall Street banks have been repaid, the government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac stand out as the source of the greatest taxpayer losses.
The Congressional Budget Office has estimated that, in the wake of the housing bubble and the unprecedented deflation in housing values that resulted, the government’s cost to bail out Fannie and Freddie will eventually reach $381 billion. That estimate may be too optimistic.
Last Christmas Eve, Treasury removed the $400 billion cap on what the government might be required to invest in these two GSEs in the future, and this may tell the real story about the cost to taxpayers. In typical Washington fashion, everyone has amnesia about how this disaster occurred.
The story is all too familiar. Politicians in positions of authority today had an opportunity to prevent this fiasco but did nothing. Now—in the name of the taxpayers—they want more power, but they have never been called to account for their earlier failings.
One chapter in this story took place in July 2005, when the Senate Banking Committee, then controlled by the Republicans, adopted tough regulatory legislation for the GSEs on a party-line vote—all Republicans in favor, all Democrats opposed. [Including Obama who took the second highest amount of cash from these people in the Senate – IUSB Vision Editor] The bill would have established a new regulator for Fannie and Freddie and given it authority to ensure that they maintained adequate capital, properly managed their interest rate risk, had adequate liquidity and reserves, and controlled their asset and investment portfolio growth.
These authorities were necessary to control the GSEs’ risk-taking, but opposition by Fannie and Freddie—then the most politically powerful firms in the country—had consistently prevented reform.
The date of the Senate Banking Committee’s action is important. It was in 2005 that the GSEs—which had been acquiring increasing numbers of subprime and Alt-A loans for many years in order to meet their HUD-imposed affordable housing requirements—accelerated the purchases that led to their 2008 insolvency. If legislation along the lines of the Senate committee’s bill had been enacted in that year, many if not all the losses that Fannie and Freddie have suffered, and will suffer in the future, might have been avoided.
Why was there no action in the full Senate? As most Americans know today, it takes 60 votes to cut off debate in the Senate, and the Republicans had only 55. To close debate and proceed to the enactment of the committee-passed bill, the Republicans needed five Democrats to vote with them. But in a 45 member Democratic caucus that included Barack Obama and the current Senate Banking Chairman Christopher Dodd (D., Conn.), these votes could not be found.
Recently, President Obama has taken to accusing others of representing “special interests.” In an April radio address he stated that his financial regulatory proposals were struggling in the Senate because “the financial industry and its powerful lobby have opposed modest safeguards against the kinds of reckless risks and bad practices that led to this very crisis.”
He should know. As a senator, he was the third largest recipient of campaign contributions from Fannie Mae and Freddie Mac, behind only Sens. Chris Dodd and John Kerry.
With hypocrisy like this at the top, is it any wonder that nearly 80% of Americans, according to new Pew polling, don’t trust the federal government or its ability to solve the country’s problems?
Posted in 2012, Campaign 2008, Chuck Norton, Corporatism, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on April 13, 2010
All that news that the economy is in a huge recovery, in spite of the fact that we keep posting the economic numbers on this web site that show that we are coasting along the current bottom (a new bottom could come with a new shock to the economy, hence the term “current bottom”). Remember that these same mainstream economists are the same ones that did not see the mortgage collapse. In fact it was the geniuses at the Fed, at the top banks, and in Academia who missed it in spite of warnings from those “amateurs” who make their living working the markets
We have said it on this blog many times and I have said it in economics class as well; most economists we see and read about are political and/or ideological prostitutes. They say what they are paid to see for political expedience and call it “science” or “economics”.
Robert Reich and Paul Krugmann claim to be economists but it amazes me just how much basic macro they have to forget to write the nonsense they do every week…. and then there is Christina Romer, who has written some good stuff, most of which she had to forget as soon as she took a job at the Obama White House.
There are other kinds of economists who are masters of Keynesian modeling. They make all of these fancy projections and it seems so intimidating, until you realize that their models rarely work out and that Keynesian theory just does not work worth a darn when applied in many circumstances.
Most “mainstream” economists fall into the previous categories.
Forbes Magazine went back to examine who it was that saw the collapse coming:
By 2004, concerns about a housing bubble were pervasive throughout the popular media. But responsible authorities continued to throw cold water on them.
Think on that statement for a moment. The responsible authorities were saying all is well, while those who participate in those markets are telling the media something different. When the “amateurs” are doing better than the super pro’s does that indicate that something is wrong in that profession?
One of the very few academics who warned that this might happen was Bob Schiller (LINK) and that was in 2003. Hedge fund manager Michael J. Burry saw it coming and invested expecting a bubble burst (LINK, 2).
The National Bureau of Economic Research says that the recession might not yet be over:
Most mainstream economists think the nation’s deep recession is over, but a special body that makes such a determination took a pass Monday, saying what many Americans intuitively feel, that the data remain inconclusive.
The National Bureau of Economic Research, a nonprofit group of economists, determines when recessions start and end as part of its work in calculating the peaks and troughs of the business cycle.
The bureau’s Business Cycle Dating Committee met last Friday and concluded that the jury is still out on the recession’s end, announcing that decision on its Web site Monday.
The committee reaffirmed that the recession began in December 2007, but its seven members couldn’t determine whether the recession has ended.
“The trough date would identify the end of contraction and the beginning of expansion. Although most indicators have turned up, the committee decided that the determination of the trough date on the basis of current data would be premature,” the committee said in a statement. “Many indicators are quite preliminary at this time and will be revised in coming months.”
One reason for a cautious view is the stubbornly high jobless rate.
Unemployment remains anchored in the ballpark of 9.7 percent. March employment numbers finally showed a solid gain of around 162,000 jobs, partly aided through government hiring to conduct the 2010 census.
Although economic expansion usually is marked by two consecutive quarters of growth, the committee wants to see more evidence of strong and consistent job growth as an indicator that businesses are hiring on the basis of a firming economy.
And in this state of regulatory uncertainty with ObamaCare, Cap & Tax, VAT Tax, status of bond holders, changes in capital gains tax rates, energy costs, expiring Bush tax cuts and the deficit can anyone be surprised that few want to create jobs here or invest in the United States? Several of the economists here at IUSB are saying that our economy has all the signs of what is called a “double dip recession”. To me this seems obvious. Economics is largely about incentives and confidence and that seems to be what most “mainstream” economists seem to continually miss.
Ed Morrissey at HotAir has some good comments HERE.
Posted in Campus Freedom, Indoctrination & Censorship, Chuck Norton, Economics 101, Mortgage Crisis | Leave a Comment »
Posted by iusbvision on March 16, 2010
Rick Santelli confirms IUSB Vision editor Chuck Norton’s analysis from long ago Fannie Mae and Freddie Mac, the two biggest problems in the mortgage industry are not being reformed, the feds are dumping billions into them and they are still getting their fat bonuses at taxpayer expense.
Santelli also points out that the TARP program was a rip off, a bait & switch. They promised to use the money to buy up toxic assets and instead used the money instead to buy control of banks and pick winners and losers in the banking industry. Bank A would get TARP money, bank B would not, bank A buys bank B and gives 5 million to ACORN or another arm of the Democratic Party. Welcome to politics Chicago style.
The Proof: Links (1, 2, 3, 4, 5, 6, 7, 8,)
Posted in 2012, Big Bizz Loves Big Govt, Chuck Norton, Corporatism, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on March 6, 2010
The government doesn’t want to be the baddie when it raises your taxes, so it places taxes and fees on various businesses, they pass on the cost to you and you in turn are angry at said business, when in reality it is your government you should be upset with.
Ask not for whom the tax bell tolls, it tolls for thee!
But the Congressional Budget Office today warned that “the ultimate cost of a tax or fee is not necessarily borne by the entity that writes the check to the government.”
“The cost of the proposed fee would ultimately be borne to varying degrees by an institution’s customers, employees, and investors,” the CBO said today in a letter to Sen. Chuck Grassley.
“Customers would probably absorb some of the cost in the form of higher borrowing rates and other charges, although competition from financial institutions not subject to the fee would limit the extent to which the cost could be passed to borrowers. Employees might bear some of the cost by accepting some reduction in their compensation, including income from bonuses, if they did not have better employment opportunities available to them. Investors could bear some of the cost in the form of lower prices of their stock if the fee reduced the institution’s future profits.”
The availability of credit – already a problem for some consumers and businesses – could also be limited by the proposed fee, the CBO said.
“The fee would probably lower the total supply of credit in the financial system to a slight degree. It would also probably slightly decrease the availability of credit for small businesses.”
The effect of the fee on the banks, the CBO said, would be “small”.
In response to the CBO analysis, Grassley released a statement, saying, “A lot of analysts have said banks would pass the fees onto their customers. The CBO analysis confirms this and adds a lot of points for consideration from a very credible source. Before this proposal moves forward, Congress needs to understand the consequences, good or bad.”
Posted in 2012, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »
Posted by iusbvision on February 19, 2010
Flashback – Andrew Breitbart exposes how CNN deliberately misreported the story.
Breitbart was sick of the CNN hit pieces in Giles-O’Keefe who should get a Pulitzer for their work exposing the ACORN story. So he offered to let Giles and O’Keefe come on CNN even for a hit piece, provided that CNN showed the video’s to let the viewers decide for themselves. CNN refused.
UPDATE – Salon.com’s Max Bluementhal making it up again. This is a must see video:
Posted in 2012, Chuck Norton, Journalism Is Dead, Leftist Hate in Action, Mortgage Crisis | Leave a Comment »
Posted by iusbvision on February 19, 2010
I have never witnessed polls like this, Americans are showing a clear contempt for both political parties and after seeing this it becomes clear why Tea Party is polling ahead of both Democrats and Republicans. Also note the massive disconnect between the political class the the governed.
Speaking as a political scientist, these numbers show that the government is losing its legitimacy (please be sure you know hat that word means in poli-sci terms before you comment). This can only mean big changes are ahead.
There is also an indicator that independents may be more conservative than Republicans now, if this trend continues it changes everything.
The founding document of the United States, the Declaration of Independence, states that governments derive “their just powers from the consent of the governed.” Today, however, just 21% of voters nationwide believe that the federal government enjoys the consent of the governed.
A new Rasmussen Reports national telephone survey finds that 61% disagree and say the government does not have the necessary consent. Eighteen percent (18%) of voters are not sure.
However, 63% of the Political Class think the government has the consent of the governed, but only six percent (6%) of those with Mainstream views agree.
Seventy-one percent (71%) of all voters now view the federal government as a special interest group, and 70% believe that the government and big business typically work together in ways that hurt consumers and investors.
That helps explain why 75% of voters are angry at the policies of the federal government, and 63% say it would be better for the country if most members of Congress are defeated this November. Just 27% believe their own representative in Congress is the best person for the job.
Posted in 2012, Campaign 2008, Chuck Norton, Corporatism, Economics 101, Energy & Taxes, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on February 19, 2010
The report also says what we have stated since the beginning, ACORN had a role to play in the mortgage collapse (LINK – LINK – LINK). The Congressional Report is HERE and woerth the read.
UPDATE – In this video Obama says that his only affiliation with ACORN was to help represent them in a “motor voter” lawsuit. Hmm what about the bank lawsuits hmmm? And what about the previous bragging you did on video talking about your long history with ACORN and all the political races you worked with them on? What about when you used to train their community organizers? What about the fact that ACORN/SEIU share facilities and the SEIU President has visited the White House on numerous occasions? Well the video speaks for itself.
UPDATE II – Gateway Pundit has a very good post on this issue LINK.
Posted in 2012, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | 2 Comments »
Posted by iusbvision on February 15, 2010
We have posted a series of articles with indepth information on how this mess came about, but this video gives the best 4 minute synopsis of the problem as I have ever seen.
Posted in 2012, Campaign 2008, Chuck Norton, Corporatism, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on February 14, 2010
For the record, I don’t care for Hank Paulson with good reason – the bailout bait & switch.
Posted in 2012, Campaign 2008, Click & Learn, Mortgage Crisis, Palin Truth Squad | Leave a Comment »
Posted by iusbvision on February 11, 2010
The Democrat Leadership claims that this Congress is the most ethical and transparent in history. What do you think?
About that $210 Million in bonuses using your money… LINK.
Posted in 2012, Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on January 29, 2010
He said he was winding the bailout program down and now has expanded it till almost 2011. Once again the rhetoric is 180 degrees apart from the action.
Our friends at Hotair.com have the details – go check it out HERE.
Posted in 2012, Chuck Norton, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »
Posted by iusbvision on January 21, 2010
Featherbedding occurs when paychecks are issued for nonexistent employees and the money goes directly into union coffers. Thousands of the jobs Obama officials say were saved or created by the stimulus program are no more real than those invisible positions invented by unions to bulk up their treasuries. We know this to be the case because as Obama’s chief economist, Christina Romer, admitted several weeks ago, “It’s very hard to say exactly because you don’t know what the baseline is, right, because you don’t know what the economy would have done without [the economic stimulus program].”
Even if we take at face value the White House claim that it created or saved all these jobs with approximately $150 billion of the economic stimulus money, a little simple math shows the taxpayers aren’t getting any bargains here: $150 billion divided by 650,000 jobs equals $230,000 per job saved or created. Instead of taking all that time required to write the 1,588-page stimulus bill, Congress could have passed a one-pager saying the first 650,000 jobless persons to report for work at the White House will receive a voucher worth $230,000 redeemable at the university, community college or trade school of their choice. That would have been enough for a degree plus a hefty down payment on a mortgage.
Actually, taxpayers would be better off with such a deal, too, compared with the reality of the Obama stimulus program. Among the top 10 stimulus contracts awarded, there is the one for nearly $339 million that allegedly created or saved 41.19 jobs, or about $8.3 million per position. It was even worse with the $258 million contract to Brookhaven Science Associates in New York, where 25 jobs were saved or created, at a cost of $10.3 million per position. Rep. Kevin Brady, R-Texas, the ranking House minority member of the Joint Economic Committee, said it best: “What we know for certain is that 2.7 million payroll jobs have been lost since the Obama stimulus was signed into law, hundreds of thousands of more jobs are being lost each month, and America is so deep in debt, China and France are lecturing us to get our financial house in order.”
Posted in 2012, Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on November 6, 2009
Rep. Edolphus Towns (D-N.Y.) locked Republicans out of the House Oversight and Government Reform Committee room to keep them from meeting when Democrats aren’t present.
Towns’ action came after repeated public ridicule from the leading Republican on the committee, Rep. Darrell Issa (R-Calif.), over Towns’s failure to launch an investigation into Countrywide Mortgage’s reported sweetheart deals to VIPs.
For months Towns has refused Republican requests to subpoena records in the case. Last Thursday Committee Republicans, led by Issa, were poised to force an open vote on the subpoenas at a Committee mark-up meeting. The mark-up was abruptly canceled. Only Republicans showed up while Democrats chairs remained empty.
Republicans charged that Towns canceled the meeting to avoid the subpoena vote. Democrats first claimed the mark-up was canceled due to a conflict with the Financial Services Committee. Later they said it was abandoned after a disagreement among Democratic members on whether to subpoena records on the mortgage industry’s political contributions to Republicans.
A GOP committee staffer captured video of Democrats leaving their separate meeting in private chambers after the mark-up was supposed to have begun. He spliced the video to other footage of the Democrats’ empty chairs at the hearing room, set it to the tune of “Hit the Road, Jack” and posted it on the Oversight and Government Reform Committee’s minority webpage, where it remained as of press time.
UPDATE: Key Evidence Destroyed – Wall Street Journal:
The discovery that Countrywide Financial Corp. recorded phone conversations with borrowers in a controversial mortgage program that included public officials — and that those recordings have been destroyed — has prompted new congressional calls for more information about the program.
Rep. Darrell Issa of California, the ranking Republican on the House Oversight and Government Reform Committee, is trying to subpoena the remaining records of Countrywide’s VIP loan program. So far, the committee’s chairman, New York Democratic Rep. Edolphus Towns, has turned down that request.
Posted in 2012, Chuck Norton, Letters to the Editor, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on October 20, 2009
HERE is a terrific analysis of New York Times economist/columnist Paul Krugman’s recent piece “How Did Economists Get It So Wrong?”. Krugman’s regular analysis have shown to be almost consistently wrong for years. Economics is a subject that is near and dear to my heart. The simple truth is that while economists can quote you terms and fancy sounding numbers, 80% of them lack the ability to connect patterns of dots and indicators to apply the knowledge with even rudimentary directional accuracy. Only 20% of economists saw recent the bubble and collapse coming in spite of the fact that Dr. Friederich Hayak won the Nobel for Economics in part for his work on economic bubbles.
Even as an undergrad (albeit told a gifted one) I have debated PhD.’s in economics and defeated them with relative ease. The simple truth is that economists, especially Marxist economists, are not even held to a weatherman’s standard for accuracy and accountability. The government told us that without the special interest written (see Apollo Alliance) stimulus bill we would see unemployment in the country reach 8%. The predictable result is that with the stimulus bill we are skyrocketing towards the 10.5% unemployment rate which would even still be understated by the vast number of discouraged workers that have stopped looking for gainful employment. Where is the accountability for these Harvard and Berkeley trained pinheads?
Most government economists routinely understate the value of classic neo-liberal economic policy such as the increases in revenue often generated by tax cuts (Laffer Curve), they also greatly underestimate the damage of tax increases to the economy (game theory) and also greatly underestimate the cost of government programs (in the case of Medicare the government underestimated the cost of the program in the first 20 years by a factor of 10).
The reason that real economists such as Dr. Thomas Sowell, Walter Williams, Larry Laffer, Amity Schlaes, and John Lott have been ignored by the elite media is precisely because their economic analysis is proved right more often than it is proved wrong. They just don’t happen to be leftists.
Crossposted at Poligazette.
Posted in 2012, Chuck Norton, Economics 101, Journalism Is Dead, Mortgage Crisis | 1 Comment »
Posted by iusbvision on September 22, 2009
They are calling it the Community Reinvestment Modernization Act (CMRA). The Old Community Reinvestment Act played an important role in lowering mortgage standards and creating so many of these high risk loans that broke the system. While the CRA was just one layer of a multi layered problem created by government that culminated in the largest economic collapse since the Great Depression, it was still an important layer, so naturally the far left wants to do it AGAIN.
As we have reported before and have taken a lead in reporting on, the original CRA was intended to make it illegal to stop “redlining”; the practice of not giving loans to people based on race. But CRA was used by the Clinton Justice Department to make it an affirmative action program for loans, forcing banks to give mortgages to people who had no business getting a home loan simply because it was very unlikely that they could pay the loan back. They say it was about giving loans to poor minorities, when it fact it was about getting loans to Democrat constituent groups.
The rub is, that giving out high risk loans did not do them any favors. Many thousands of people in high risk loans defaulted, they lost their homes, their credit was destroyed and mortgage securities based on those loans brought down AIG, Lehman Brothers and dozens of banks.
Of course ACORN was at the heart of this problems as they filed CRA lawsuits to force banks to make high risk loans, under the faux guise of “fighting racism”.
We reported on this activity extensively HERE and HERE.
ACORN and SEIU have already created an atroturf support group to help get it passed – LINK.
The CRMA takes the old CRA one step further and mandates that loans be given to minorities regardless of income. Is giving a home loan to anyone regardless of income a wise move?
The Washington Examiner has details:
Dems push expanded Community Reinvestment Act; deny Act’s role in mortgage meltdown; GOP cites ACORN connection
By: BYRON YORK
Chief Political Correspondent
09/16/09 4:13 PM EDT
A number of experts believe that aggressive enforcement of the 1970s-era Community Reinvestment Act contributed to the mortgage meltdown, and thus to the greater financial crisis, by requiring financial institutions to lend to unqualified borrowers. Now, the Democratic majority in the House of Representatives is responding to that situation by proposing to expand the scope and power of the Community Reinvestment Act.
This morning House Financial Services Committee chairman Rep. Barney Frank held a hearing on H.R. 1479, the “Community Reinvestment Modernization Act of 2009.” The bill’s purpose is “to close the wealth gap in the United States” by increasing “home ownership and small business ownership for low- and moderate-income borrowers and persons of color.” It would extend CRA’s strict lending requirements to non-bank institutions like credit unions, insurance companies, and mortgage lenders. It would also make CRA more explicitly race-based by requiring CRA standards to be applied to minorities, regardless of income, going beyond earlier requirements that applied solely to low- and moderate-income areas.
Republicans on the committee strongly oppose the plan. “Instead of looking to expand the number of institutions that must abide by Community Investment Act regulations,” California Rep. Ed Royce said in prepared opening remarks at today’s hearing, “I think we should reassess the role this and other government mandates played in the financial collapse and consider scaling it back.”
In private conversation, other Republicans were more emphatic. “There is clearly arguable evidence that the CRA is at the root of this financial meltdown,” says one GOP committee member. “So what do they do? They try to expand CRA.”
But Democrats, led by H.R. 1479 sponsor Rep. Eddie Bernice Johnson, claimed that expansion of CRA is much-needed. “Congress has passed a number of laws designed to combat redlining and eliminate housing discrimination,” Johnson said at the hearing. “Unfortunately, we all know that redlining still occurs.”
Then there is the ACORN angle. Republican critics point out that the Association of Community Organizations for Reform Now has used the CRA to pressure banks to pour money into ACORN and its affiliates, allowing ACORN to facilitate loans to clearly unqualified borrowers. Now, with ACORN under fire after a series of undercover videos showing ACORN workers in Baltimore, Washington DC, New York, and California openly encouraging prostitution, tax evasion, and other crimes, Republicans on the committee are citing the CRA-ACORN connection as yet another reason the Act should not be expanded.
Johnson’s bill has 51 co-sponsors, including some of the most liberal members of the House, like Reps. Dennis Kucinich, John Conyers, Bobby Rush, Steve Cohen, and Barbara Lee. Given the Democrats’ tremendous numerical superiority in the House, if the majority wants to expand CRA, Republicans will be unable to stop it.
UPDATE – Byrom York gives an analysis of the CRA that is spot on and tells the same story we told when the collapse took place. Well done Byron.
Washington Examiner Byron York:
Democrats on path to repeat housing disaster
By: Byron York
Chief Political Correspondent
September 22, 2009
With all the attention paid to the health care battle, ACORN, and the president’s “Full Ginsburg” appearances on five Sunday talk shows, few people noticed a hearing with an exceedingly boring title — “Proposals to Enhance the Community Reinvestment Act” — held last week in the House Financial Services Committee. But the session marked a key moment in the ongoing battle between Republicans and Democrats over what caused our current financial woes — and how we might best avoid getting into the same trouble again.
At the hearing, and in others across Capitol Hill, Democratic majorities are pressing hard to expand some of the very policies that led to the reckless home lending that in turn helped lead to the great financial meltdown. If Chairman Barney Frank and his fellow Democrats have their way, we’ll do it all again — and more.
At issue last week was H.R. 1479, the Community Reinvestment Modernization Act of 2009, sponsored by Democratic Rep. Eddie Bernice Johnson. It would expand and strengthen the 1977 Community Reinvestment Act, which required banks to make loans in low-income areas that many lenders had traditionally shunned.
After the meltdown, some conservatives blamed the CRA for almost solely causing the crisis by requiring banks to make risky loans to unqualified borrowers. It was an unfair charge. “CRA had at best an incremental role in the U.S. housing debacle,” says J.D. Foster, an economist at the Heritage Foundation. But CRA did help create the conditions in which disaster could occur.
The problems began in the 1990s, when Congress made it harder for lenders to do business if they had not passed the CRA “exam” — that is, if they had not met the government-imposed standards for loans to low- and moderate-income borrowers.
“From 1995 on, there was an incredible push by the Clinton and Bush administrations in every way they could — CRA, Fannie Mae, Freddie Mac, and other ways — to increase the homeownership rate,” says Russell Roberts, a professor of economics at George Mason University. “What that did was to push up the price of housing, and that made it imaginable to lend money to people you never would have lent money to, on terms you wouldn’t have done before.”
In particular, Fannie Mae began to aggressively promote homeownership using the Community Reinvestment Act to give loans to people who couldn’t afford them. Fannie went to bankers and said, make as many CRA loans as you can; we’ll buy them and take them off your hands. “Our approach to our lenders is ‘CRA Your Way,’ ” top Fannie executive Jamie Gorelick told the Mortgage Bankers Association in 2001. “Fannie Mae will buy CRA loans from lenders’ portfolios; we’ll package them into securities; we’ll purchase CRA mortgages at the point of origination. …”
Fannie promised to buy billions and billions of dollars worth of CRA loans because it was under pressure to do so from the Department of Housing and Urban Development, which in turn was under pressure from Congress, which set ambitious quotas for low- and moderate-income loans.
The policy ended in a lot of people losing their homes. Now, Johnson’s bill would ensure more of that by applying CRA’s lending requirements not just to banks but to non-bank institutions like credit unions, insurance companies, and mortgage lenders. It would also make CRA explicitly race-based by, in Johnson’s words, “requiring CRA exams to explicitly consider lending and services to minorities in addition to low- and moderate-income communities.”
Republicans on the Financial Services Committee strongly oppose the plan. “Instead of looking to expand the number of institutions that must abide by CRA regulations, I think we should reassess the role this and other government mandates played in the financial collapse and consider scaling it back,” California Rep. Ed Royce said at the hearing.
In private conversation, other Republicans were more emphatic. “There is clearly arguable evidence that the CRA is at the root of this financial meltdown,” said one GOP committee member. “So what do they do? They try to expand CRA.”
That’s an overstatement of CRA’s role in the housing mess, but it’s right about the Democratic plan. Denying that CRA, Fannie and other institutions played any role in setting the stage for disaster, they’re proposing more of what helped get us into trouble in the first place. It’s no way to fix the problem.
Posted in 2012, Campaign 2008, Chuck Norton, Corporatism, Economics 101, Journalism Is Dead, Leftist Hate in Action, Mortgage Crisis, Obama and Congress Post Inaugration | 3 Comments »
Posted by iusbvision on August 18, 2009
This is a the new video from Clinton political strategist Dick Morris.
We have been saying it since February 3rd. Obama’s mortgage plan wasn’t serious and would help very few. Anyone who wanted to seriously tackle the economy needed to have a plan for the toxic assets, keep mortgage holders in their homes and get housing prices to steady. Obama’s plan did none of that and the economy has continued to suffer for it.
Since that February 3rd article we have covered this story repeatedly and told you how the crisis was being prolonged as an excuse to gain control of the banks. [LINKS 1, 2, 3, 4, 5, 6, 7, & 1, 2,].
If you followed those links and examined our work you can see that we started reporting this before Fox and CNBC’s Rick Santelli and Jim Cramer.
Posted in 2012, Chuck Norton, Corporatism, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »
Posted by iusbvision on July 16, 2009
There are so many superb conservative organisations in the US that, whenever I come here, I feel like a defector from the old Soviet bloc confronted with teeming supermarket shelves. One outfit which deserves a special place of honour, though, is the American Legislative Exchange Council (ALEC). The mission statement says it all:
The mission of the American Legislative Exchange Council is to advance the Jeffersonian principles of free markets, limited government, federalism and individual liberty among America’s state legislators.
You will immediately perceive that this, mutatis mutandis, is what British localism is all about. We, too, fight for the dispersal of power, and for the Jeffersonian ideal that decisions should be taken as closely as possible to the people they affect. The Plan is, in one sense, an application of the ALEC doctrine to British conditions. The only politician whose features adorn my office is Thomas Jefferson: I have a bust of the great man on my desk, given to me on a previous visit to ALEC.I am blogging from Atlanta, Georgia, where ALEC is celebrating its 36th annual conference. There are hundreds of state legislators here, swapping ideas on everything from welfare reform to tax cuts.
Yet again, I am struck by the advantages of dispersed jurisdiction: the freedom to innovate, to copy what works elsewhere; the benefits of competition and pluralism. I’m reading a book called Rich States, Poor States which explains, with pitiless statistical evidence, why states with high taxes are deserted, first by wealthy individuals and employers, then by the population at large. Twelve hundred people a day are moving from high-tax to low-tax states. Still, the very fact of tax competition keeps overall tax levels down in a way unknown in Britain.
One of the co-authors of the book, the father of supply-side economics, Art Laffer, just gave a brilliant disquisition in which he demonstrated why every single action taken by the government since the financial crisis has served to make things worse. (Regular readers will know that the same is true in Britain.) He did so by restating the most basic economic truths: what Kipling called “The Gods of the Copybook Headings”. If you take money from people who work and give it to people who don’t, you disincentivise work. If you tax the rich and reward the poor, you get fewer rich people and more poor people. If your tax rates are higher than your competitors, people prefer to do business elsewhere. Laffer has a brilliant knack of making economics seem simple – or, as he would say, of showing how simple it truly is, once you cut through the jargon and cant in which professional economists have bandaged it.
I am addressing ALEC tomorrow, following a quick visit to the local Republicans this evening. But what I’m really hoping to do in Georgia is to meet one of the greatest living politicians in the US, Newt Gingrich. Even now, I’m not sure people grasp the magnitude of his Contract with America, which ended forty years of one-party rule in Congress and introduced Americans to the idea that elected representatives might, after all, keep their promises. An unremarked but baleful consequence of the Obama stimulus package has been the reversal of the single most successful part of the Contract: welfare reform. America will soon be crying out for another Gingrich; Britain already is.
Posted in 2012, Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »