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The way to crush the middle class is to grind them between the millstones of taxation and inflation. – Vladimir Lenin

Archive for the ‘Mortgage Crisis’ Category

Media malpractice on healthcare, the morgage crisis, and Barney Frank who is at it again.

Posted by iusbvision on July 15, 2009

Investors Business Daily:

The Price Of Media Malpractice
By INVESTOR’S BUSINESS DAILY | Tuesday, June 30, 2009

Barney Frank

Barney Frank

Media: They laugh at his jokes. They say he’s the smartest guy in Congress. And 90% of them agree with him politically. Small wonder the havoc Barney Frank wreaks on the economy gets so little attention.

America has its share of problems, to be sure. But one of the most pernicious is the bias that permeates the media. We’ve been saying this for years, noting how it leads to half-covered issues, an ill-informed populace and wretched legislation that dogs us for decades.

Never, however, has it been as pervasive as now. Yes, the fact that the media are head over heels for our new president has made the favoritism more obvious.

When a major TV network like ABC, whose employees gave 80 times as much in financial contributions to Obama’s presidential campaign as they gave to his opponent’s, lets the president commandeer its news programming to tout a plan to take over the health care industry, it’s hard not to notice.

But it goes much deeper than Barack Obama. It also involves Rep. Frank and other politicians who are in large part responsible for the financial meltdown that led to the economic disaster from which we continue to suffer.

How we got into this, the worst economic fix since the Great Depression, is the most monumental question of our time. Yet despite the information that we and other non-mainstream media have put out, people still haven’t connected the dots.

This was driven home again last week, when it was disclosed that Frank, who is chairman of the House Financial Services Committee, wants standards for mortgages on new condominiums to be relaxed.

Seems the rules have been tightened to limit the exposure of Fannie Mae and Freddie Mac, the two government-sponsored agencies that buy most of the mortgages in America. Frank reportedly believes they’re “too onerous.”

Frank’s suggestion has gotten little press. Where it has been covered, little has been made of the fact that the congressman was a key backer of the lax rules that prevailed in the Fannie- and Freddie-backed subprime loan fiasco that sank the U.S. housing market and global financial markets.

As we said last week, Frank stood “athwart nearly all efforts to reform (Freddie and Fannie) until it was too late.” Rather than run down that list again, we refer readers to Thomas Sowell’s latest book, “The Housing Boom and Bust.”

One of America’s best economists and thinkers, Sowell in 148 pages chronicles this economic catastrophe from the passage in 1977 of the Community Reinvestment Act, which directed regulators to encourage financial institutions to “meet the credit needs of the local communities.”

It goes through the 1990s, when the CRA was revised to (1) pressure banks into relaxing lending standards for low-income borrowers and (2) push Fannie and Freddie to buy subprime loans and subprime securities to meet “affirmative action” quotas.

Sowell’s book also covers the efforts by Frank and others this decade to defend the tottering system and block moves to head off disaster.

Of the many comments by Frank that Sowell quotes is this from 2003: “Fannie Mae and Freddie Mac have played a very useful role in helping make housing more affordable. (Critics) exaggerate a threat of safety” and “conjure up the possibility of serious financial losses to the Treasury, which I do not see.”

Since then, the U.S. Treasury has been forced to bail out the financial system and two major car companies to the tune of $700 billion and counting. As for Fannie and Freddie, they’re in government receivership after adding $238 billion to the nation’s debt to bolster their shaky finances.

Yet back in 2003, Sowell notes, Frank was arguing that the federal government had “probably done too little rather than too much to push (Fannie and Freddie) to meet the goals of affordable housing.”

Sowell quoting Frank: “I would like Fannie and Freddie more deeply into helping low-income housing and possibly moving into something that is more explicitly a subsidy. I want to roll the dice a little bit more in this situation.”

Now Frank is back at the craps table, pushing for another relaxation of Fannie and Freddie loan standards. Yet the media, which seem oblivious to the history of the housing meltdown, apparently see no connection.

The same media, by the way, were just as passive Tuesday when Acorn, the “community group” that Obama once served as legal counsel, held demonstrations at the offices in 15 cities of four mortgage lenders that haven’t signed on to the president’s voluntary “Making Home Affordable” foreclosure-avoidance program.

Such demonstrations wouldn’t be that newsworthy if it weren’t for the fact that Acorn also played a key role in the subprime mortgage crisis by strong-arming banks into making loans they shouldn’t have. Here it’s trying to intimidate lenders once again. Once again, the media apparently see nothing of note.

Until they make the connection, the public at large will never realize it was Big Government, with its horribly conceived and executed programs, that created the mess in which we find ourselves. And it’ll be the public at large that will continue to suffer the devastation of future programs — whether they target housing, banking, energy or health care.

Posted in 2012, Chuck Norton, Economics 101, Health Law, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

12.8 Trillion Spent: Economy Shrinks 6.1%

Posted by iusbvision on April 29, 2009

Bloomberg news is where we got the 12.8 trillion number and we wrote about this HERE. Housing demand is still really bad and there has been no serious attempt to fix housing by the government and now we are pushing into May. Government seems to be using this crisis to take control of the banks and it has also proposed taking 51% ownership in GM (LINK).

Yahoo/AP:

WASHINGTON (AP) — The economy shrank at a worse-than-expected 6.1 percent pace at the start of this year as sharp cutbacks by businesses and the biggest drop in U.S. exports in 40 years overwhelmed a rebound in consumer spending.

The Commerce Department’s report, released Wednesday, dashed hopes that the recession’s grip on the country loosened in the first quarter. Economists surveyed by Thomson Reuters expected a 5 percent annualized decline.

Instead, the economy ended up performing nearly as bad as it had in the final three months of last year when it logged the worst slide in a quarter-century, contracting at a 6.3 percent pace. Nervous consumers played a prominent role in that dismal showing as they ratcheted back spending in the face of rising unemployment, falling home values and shrinking nest eggs.

Posted in Chuck Norton, Economics 101, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Daughter of laid-off worker: Obama where is the help you promised in the campaign?

Posted by iusbvision on April 8, 2009

090404_daleen_deck

The biggest problem is the United States right now is the housing and mortgage industry. The government promised with the first bailout to buy up troubled mortgages so they could renegotiate with home owners and buy them some time. As soon as the government got the money from Congress they decided not to help the people and used the money to take control of the banks. Now between Treasury, Congress and the Federal Reserve we have spent 12.8 trillion buying bank stock to get control of the banks, in the meantime it is April and people have still received no help at all.

KOMO:

SPOKANE, Wash. – Two Washington state girls took their plea straight to President Obama after their dad was laid off from his job.

The two mailed a letter to the president at the White House after watching their father, Henry, struggle to find a new job. Now they’re about to lose their home.

It’s a simple letter – asking for help.

“My name is Lilian Deck and my sister and I live in Spokane,” the girls’ letter begins. “We would like to ask you a question – where is the help you promised in your campaign?”

The letter is signed by Lilian, 13, and her 10-year-old sister Daleen.

“My father doesn’t want a handout, he wants a job,” the letter says. “He has sent out over 300 resumes with no luck.”

Then Lilian adds, “And we know that because we’ve had to lick the envelopes.”

Henry Deck lost his job a year ago, and on Sunday he’ll lose his home to foreclosure.

“Tomorrow my house goes up on the auction block,” said Henry Deck.

So his daughters, in desperation, sent their letter to the president.

“Why do you and the Congress keep failing this country over and over?” says the girls’ letter, which rips Obama’s stimulus plan for helping banks and big business – before helping families like theirs.

“We didn’t have a subprime mortgage – we had a regular mortgage,” says Henry Deck. “When we went and asked for help, there is none. We don’t fall in the guidelines.”

“I made too much money two years ago – I don’t make enough now. We just fell through the cracks,” he says.

Now his two girls are living the reality of the recession.

“I’m most worried about where we’re going to live – where we will live and how will we,” says Henry Deck. “If I lose my house I may lose my children, too.”

Henry Deck says he is most frustrated by potential employers who say they can’t afford him because he’s overqualified.

Now Deck is praying for a last-minute miracle.

“I don’t know – they may be living out of our car,” he says.

The girls are hoping their letter will bring some kind of help.

“Mr. President – may God bless you and the United States and help you do the right things for this country,” their letter says.

So far the Decks haven’t gotten a response to their letter.

 

Posted in Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | 2 Comments »

Watch Barney Frank bully a college student and lie through his teeth about his role in the mortgage crisis.

Posted by iusbvision on April 7, 2009

Our friend Michelle Malkin has a post today about a college student who challenges Frank on his role in the mortgage crisis. The student was not as well prepared as he should have been, but it is interesting to watch Frank become unhinged and launch into a litany of lies about his history on the matter.

In the video link by Malkin, Frank says that it was the Bush Administration that was resisting re-regulation and policing of the mortgage industry. As we have proved with evidence, this was just not the case.

Go see Michelle Malkin’s post HERE and be sure to watch the video.

Also, Malkin quotes Judicial Watch who just received new documents from the Fannie Mae and Freddie Mac regulator that amount to yet another mountain of evidence of barney Frank’s corruption and guilt in this matter:

…the FOIA records that Judicial Watch obtained and released yesterday, which I linked yesterday. A reminder for Barney Frank (and ammunition for the next time a brave student wants to take him on again):

Judicial Watch obtained the documents from the Federal Housing Finance Agency (FHFA) in response to a Freedom of Information Act (FOIA) request dated December 4, 2008. Judicial Watch requested records related to members of Congress activity regarding the policy of Fannie Mae and Freddie Mac to increase lending to individuals with poor credit risk, as well as correspondence and records about contacts between FHFA and Fannie and Freddie. Among the important documents:

FHFA letter, dated March 26, 2007, from the director of the Office of Housing Enterprise Oversight (OHFEO), James B. Lockhart, to U.S. Senators Elizabeth Dole, Chuck Hagel, Mel Martinez and John Sununu: “This is a very serious issue. Freddie Mac’s inadequate systems and controls make it a significant supervisory concern. Furthermore, its lack of timely public disclosures deny market participants the essential financial information made available by all other publicly traded companies so that investors may make informed judgments.” The letter also mentions, “…Fannie Mae still has not filed financial statements for 2005 and 2006 and thus, they are not timely filers either.”

FHFA letter, dated December 3, 2004, to Congressman Barney Frank: “On November 15, 2004 Fannie Mae filed a Form 12b-25 with the Securities and Exchange Commission (SEC). Fannie Mae indicated that its external auditors could not complete their reviews of its financial statements and noted the possibility of up to a $9 billion loss dating back to 2001. As a result, OHFEO has determined it will not provide a monthly capital classification at this time.”

Letter dated June 16, 2006, from OHFEO Director Lockhart to Senator Chuck Hagel: “…In January 1999, Chairman and CEO Franklin Raines approved a recommendation made by the Chief Financial Officer (CFO) (Tom Howard) and the Controller (Leanne Spencer) to defer recognition of $200 million in amortization expense. This deferral, along with other accounting decisions made at that time relating to provisions for loan losses and the recognition of low-income housing tax credits, allowed management to meet the EPS threshold for maximum bonuses.”
Overall, these documents show that Congress was made aware of the massive problems at Fannie Mae and Freddie Mac over the last six years. Yet liberals, led by Congressman Barney Frank, repeatedly blocked attempts to rein in Fannie Mae and Freddie Mac.

For example, during a hearing on September 10, 2003, before the House Committee on Financial Services considering a Bush administration proposal to further regulate Fannie and Freddie, Rep. Frank stated: “I want to begin by saying that I am glad to consider the legislation, but I do not think we are facing any kind of a crisis. That is, in my view, the two government sponsored enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis. We have recently had an accounting problem with Freddie Mac that has led to people being dismissed, as appears to be appropriate. I do not think at this point there is a problem with a threat to the Treasury.

Senators Hagel, Dole and Sununu (all Republicans) are mentioned in OFHEO’s correspondence because those three Senators worked the hardest, year after year to try and fix this problem since 2001 and Democrats like Barney Frank and Chris Dodd were successful at getting such reforms blocked because Fannie Mae and Freddie Mac were spending hundreds of millions in partisan activities and lobbying of which Democrats were the greatest beneficiaries.

Posted in Chuck Norton, Mortgage Crisis | 2 Comments »

Wall Street Journal catches up with IUSB Vision: Obama wants to control the banks & that is why he is refusing to take back TARP funds.

Posted by iusbvision on April 4, 2009

We told you this was the plan HERE. We gave you the evidence and then with updates the evidence piled on. Now the Wall Street Journal has finally said it. This is serious impeachment territory we are entering folks and that is not something this writer says lightly. Why is this impeachment territory? The president and willing members of his party are using this crisis to entrench and extend their power while the American people are suffering. What a violation of  the public trust:

Obama Wants to Control the Banks

There’s a reason he refuses to accept repayment of TARP money.

By STUART VARNEY

I must be naive. I really thought the administration would welcome the return of bank bailout money. Some $340 million in TARP cash flowed back this week from four small banks in Louisiana, New York, Indiana and California. This isn’t much when we routinely talk in trillions, but clearly that money has not been wasted or otherwise sunk down Wall Street’s black hole. So why no cheering as the cash comes back?

My answer: The government wants to control the banks, just as it now controls GM and Chrysler, and will surely control the health industry in the not-too-distant future. Keeping them TARP-stuffed is the key to control. And for this intensely political president, mere influence is not enough. The White House wants to tell ’em what to do. Control. Direct. Command.

It is not for nothing that rage has been turned on those wicked financiers. The banks are at the core of the administration’s thrust: By managing the money, government can steer the whole economy even more firmly down the left fork in the road.

If the banks are forced to keep TARP cash — which was often forced on them in the first place — the Obama team can work its will on the financial system to unprecedented degree. That’s what’s happening right now.

Here’s a true story first reported by my Fox News colleague Andrew Napolitano (with the names and some details obscured to prevent retaliation). Under the Bush team a prominent and profitable bank, under threat of a damaging public audit, was forced to accept less than $1 billion of TARP money. The government insisted on buying a new class of preferred stock which gave it a tiny, minority position. The money flowed to the bank. Arguably, back then, the Bush administration was acting for purely economic reasons. It wanted to recapitalize the banks to halt a financial panic.

Fast forward to today, and that same bank is begging to give the money back. The chairman offers to write a check, now, with interest. He’s been sitting on the cash for months and has felt the dead hand of government threatening to run his business and dictate pay scales. He sees the writing on the wall and he wants out. But the Obama team says no, since unlike the smaller banks that gave their TARP money back, this bank is far more prominent. The bank has also been threatened with “adverse” consequences if its chairman persists. That’s politics talking, not economics.

Think about it: If Rick Wagoner can be fired and compact cars can be mandated, why can’t a bank with a vault full of TARP money be told where to lend? And since politics drives this administration, why can’t special loans and terms be offered to favored constituents, favored industries, or even favored regions? Our prosperity has never been based on the political allocation of credit — until now.

Which brings me to the Pay for Performance Act, just passed by the House. This is an outstanding example of class warfare. I’m an Englishman. We invented class warfare, and I know it when I see it. This legislation allows the administration to dictate pay for anyone working in any company that takes a dime of TARP money. This is a whip with which to thrash the unpopular bankers, a tool to advance the Obama administration’s goal of controlling the financial system.

After 35 years in America, I never thought I would see this. I still can’t quite believe we will sit by as this crisis is used to hand control of our economy over to government. But here we are, on the brink. Clearly, I have been naive.

 

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Fannie Mae and Freddie Mac paying $210 million in bonuses with your money and no outrage why…..

Posted by iusbvision on April 4, 2009

…bacause Fannie Mae and Freddie Mac kick back huge amounts of money to lobbyists and Democrats its silly.

Fannie Mae and Freddie Mac, the two corrupt government sponsored mortgage enterprises that were the lion share cause of the global economic meltdown will pay out $210 million in bonuses with your money.

As we reported earlier, Fannie and Freddie were used to launder hundreds of millions of dollars back to mostly partisan Democratic groups and politicians which is why the Democrats blocked any meaningful mortgage reform since 2001.

Posted in 2012, Big Bizz Loves Big Govt, Chuck Norton, Economics 101, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | 2 Comments »

Bloomberg: Government has spent 12.8 Trillion buying up/shoring up banks. Still no mortgage help.

Posted by iusbvision on April 1, 2009

As we reported earlier, when it was at 9.7 Trillion that was enough to pay off 90% of all mortgages in the United States – LINK. Instead of fixing toxic assets, mortgages and housing the government decided to turn around and use out money to buy up and get control of the banks – LINK. Now it is 12.8 trillion which is more than enough to buy up all of the toxic assets and essentially fix most of the problem, but none of that has been done. We are being scammed.

Bloomberg News now reports 12.8 trillion.

March 31 (Bloomberg) — The U.S. government and the Federal Reserve have spent, lent or committed $12.8 trillion, an amount that approaches the value of everything produced in the country last year, to stem the longest recession since the 1930s.

New pledges from the Fed, the Treasury Department and the Federal Deposit Insurance Corp. include $1 trillion for the Public-Private Investment Program, designed to help investors buy distressed loans and other assets from U.S. banks. The money works out to $42,105 for every man, woman and child in the U.S. and 14 times the $899.8 billion of currency in circulation. The nation’s gross domestic product was $14.2 trillion in 2008.

Posted in Chuck Norton, Economics 101, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | 3 Comments »

Byron York: Congress floats a bill to control your salary. – Is government big enough yet?

Posted by iusbvision on April 1, 2009

Byron York in the DC Examiner:

But now, in a little-noticed move, the House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the “Pay for Performance Act of 2009,” would impose government controls on the pay of all employees — not just top executives — of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place. And it would give Treasury Secretary Timothy Geithner extraordinary power to determine the pay of thousands of employees of American companies.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Daniel Hannan on France and Germany warning the US that we are spending too much

Posted by iusbvision on March 31, 2009

Why do people blindly follow governments which are intent on bankrupting them?

To some extent it is because in a crisis people want to give the benefit of the doubt to the guy who looksas though he has the answers. Frenzied activity can create the illusion that you know what you are doing. That certainly that happened in Britain and that was the background for the bail-out and stimulus package. Unfortunately it takes a momentum of its own because the bail-outs and stimulus don’t work and the government’s response is not to say “we were wrong” because they cant then turn around and tell the taxpayers that it was all a waste so they have to carry on. They make it worse. There is a dreadful, grisly logic to the thing where bail-outs beget bail-outs, ‘So we spent a bunch of money, so that didn’t work so lets spend another bunch of money; even more that will really work’. And once we find out that it didn’t work it’s too late.

Posted in Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

WASHINGTON TIMES: AIG chiefs pressed to donate to Dodd – UPDATE: AIG extorted employees to donate to Dodd!

Posted by iusbvision on March 30, 2009

We told you about the corruption and the the pay to play. Dodd was the #1 reviever of campaign money from these people and Obama is #2. We are being ripped off.

The Times:

As Democrats prepared to take control of Congress after the 2006 elections, a top boss at the insurance giant American International Group Inc. told colleagues that Sen. Christopher J. Dodd was seeking re-election donations and he implored company executives and their spouses to give.

Getty Images Sen. Christopher J. Dodd, chairman of the Senate Banking, Housing and Urban Affairs Committee, has lost some political standing heading into re-election because of his ties to American International Group Inc.

The message in the Nov. 17, 2006, e-mail from Joseph Cassano, AIG Financial Products chief executive, was unmistakable: Mr. Dodd was “next in line” to be chairman of the Senate Banking, Housing and Urban Affairs Committee, which oversees the insurance industry, and he would “have the opportunity to set the committee’s agenda on issues critical to the financial services industry.

“Given his seniority in the Senate, he will also play a key role in the Democratic Majority’s leadership,” Mr. Cassano wrote in the message, obtained by The Washington Times.

Mr. Dodd’s campaign quickly hit pay dirt, collecting more than $160,000 from employees and their spouses at the AIG Financial Products division (AIG-FP) in Wilton, Conn., in the days before he took over as the committee chairman in January 2007. Months later, the senator transferred the donations to jump-start his 2008 presidential bid, which later failed.

Now, two years later, Mr. Dodd has emerged as a central figure in the government’s decision to let executives at the now-failing AIG collect more than $218 million in bonuses, according to the Connecticut attorney general – even as the company was receiving billions of dollars in assistance from the Troubled Asset Relief Program (TARP). He acknowledged that he slipped a provision into legislation in February that authorized the bonuses, but said the Treasury Department asked him to do it.

UPDATE – Ainsley Aerhart goes over the numerous Chris Dodd scandals –

Fox & Friends on how AIG extorted it’s employees to give $160,000 to Sen. Dodd

Posted in Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »

Treasury unveils proposed legislation to seize companies. Morris: This is a plan to nationalize the banks.

Posted by iusbvision on March 28, 2009

We covered this story previously in detail HERE  and Ed Morrissey at Hotair.com had commented on the story HERE. Now Geithner has wheeled out his proposed legislation to seize companies. Below is the link:

http://www.ustreas.gov/press/releases/tg70.htm

The potential for abuse in this plan is off the scale. Not to mention the constitutional problems with seizing that may come with it. This is corporatism pretty straight forward. Can anyone imagine government NOT abusing this power if they get it? After viewing this plan can anyone dare say that this is NOT socialism? All of you who made fun of John McCain for saying that Obama is a socialist should be swallowing their words now as this plan demonstrates it beyond reasonable doubt.

Former Clinton Advisor Dick Morris says Obama is trying to get control of the banks. “This is a well thought out plan for bank nationalization”.

Businesses will flee the country even faster if this is passed and we have already seen how policies like this undermine investor confidence and resulted in the crippling of economic growth in socialist Europe.

For more, we covered this story in greater detail HERE.

UPDATE: Judge Napolitano with Sheppard Smith. “They are trying to micromanage the economy…” 

Update II – Dick Morris explains how this plan will lead to the nationalization of the banks –

Posted in Chuck Norton, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Rahm Emanuel recieved $320,000 from Freddie Mac before it went under. – ABC, CBS, NBC refuse to cover the story!

Posted by iusbvision on March 28, 2009

Rahm Emanuel is President Obama’s Chief of Staff. Freddie Mac was one of the biggest players that caused the economic collapse. Should Rahm Emanuel pay back this money just as failed CEO’s have been asked to give back?

Only the Chicago Tribune and Fox featured this story prominently. A search of ABC, CBS and NBC‘s web site shows nothing on this story and those links go to the screen shots.

Chigaco Tribune:

Rahm Emanuel’s profitable stint at mortgage giant

Short Freddie Mac stay made him at least $320,000

By Bob Secter and Andrew Zajac | Tribune reporters

3:18 PM CDT, March 26, 2009

Before its portfolio of bad loans helped trigger the current housing crisis, mortgage giant Freddie Mac was the focus of a major accounting scandal that led to a management shake-up, huge fines and scalding condemnation of passive directors by a top federal regulator.

One of those allegedly asleep-at-the-switch board members was Chicago’s Rahm Emanuel-now chief of staff to President Barack Obama-who made at least $320,000 for a 14-month stint at Freddie Mac that required little effort.

As gatekeeper to Obama, Emanuel now plays a critical role in addressing the nation’s mortgage woes and fulfilling the administration’s pledge to impose responsibility on the financial world.

He was named to the Freddie Mac board in February 2000 by Clinton, whom Emanuel had served as White House political director and vocal defender during the Whitewater and Monica Lewinsky scandals.

[snip]

The board met no more than six times a year. Unlike most fellow directors, Emanuel was not assigned to any of the board’s working committees, according to company proxy statements. Immediately upon joining the board, Emanuel and other new directors qualified for $380,000 in stock and options plus a $20,000 annual fee, records indicate.
Many of those same risky investment practices tied to the accounting scandal eventually brought the firm to the brink of insolvency and led to its seizure last year by the Bush administration, which pledged to inject up to $100 billion in new capital to keep the firm afloat. The Obama administration has doubled that commitment.

On Emanuel’s watch, the board was told by executives of a plan to use accounting tricks to mislead shareholders about outsize profits the government-chartered firm was then reaping from risky investments. The goal was to push earnings onto the books in future years, ensuring that Freddie Mac would appear profitable on paper for years to come and helping maximize annual bonuses for company brass.

The accounting scandal wasn’t the only one that brewed during Emanuel’s tenure.

During his brief time on the board, the company hatched a plan to enhance its political muscle. That scheme, also reviewed by the board, led to a record $3.8 million fine from the Federal Election Commission for illegally using corporate resources to host fundraisers for politicians. Emanuel was the beneficiary of one of those parties after he left the board and ran in 2002 for a seat in Congress from the North Side of Chicago.

The board was throttled for its acquiescence to the accounting manipulation in a 2003 report by Armando Falcon Jr., head of a federal oversight agency for Freddie Mac. The scandal forced Freddie Mac to restate $5 billion in earnings and pay $585 million in fines and legal settlements. It also foreshadowed even harder times at the firm.

Freddie Mac reported recently that it lost $50 billion in 2008. It so far has tapped $14 billion of the government’s guarantee and said it soon will need an additional $30 billion to keep operating.

Like its larger government-chartered cousin Fannie Mae, Freddie Mac was created by Congress to promote home ownership, though both are private corporations with shares traded on the New York Stock Exchange. The two firms hold stakes in half the nation’s residential mortgages.

Posted in 2012, Chuck Norton, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Priceless: Sen. Dodd’s Wife Was an AIG Director.

Posted by iusbvision on March 25, 2009

And this shows that Dodd knew more about the internal workers of AIG than he lead on.

Real Clear Politics :

Dodd’s Wife a Former Director of Bermuda-Based IPC Holdings, an AIG Controlled Company

By Kevin Rennie

No wonder Senator Christopher Dodd (D-Conn) went wobbly last week when asked about his February amendment ratifying hundreds of millions of dollars in bonuses to executives at insurance giant AIG. Dodd has been one of the company’s favorite recipients of campaign contributions. But it turns out that Senator Dodd’s wife has also benefited from past connections to AIG as well.

From 2001-2004, Jackie Clegg Dodd served as an “outside” director of IPC Holdings, Ltd., a Bermuda-based company controlled by AIG. IPC, which provides property casualty catastrophe insurance coverage, was formed in 1993 and currently has a market cap of $1.4 billion and trades on the NASDAQ under the ticker symbol IPCR. In 2001, in addition to a public offering of 15 million shares of stock that raised $380 million, IPC raised more than $109 million through a simultaneous private placement sale of 5.6 million shares of stock to AIG – giving AIG a 20% stake in IPC. (AIG sold its 13.397 million shares in IPC in August, 2006.)

Clegg was compensated for her duties to the company, which was managed by a subsidiary of AIG. In 2003, according to a proxy statement, Clegg received $12,000 per year and an additional $1,000 for each Directors’ and committee meeting she attended. Clegg served on the Audit and Investment committees during her final year on the board.

IPC paid millions each year to other AIG-related companies for administrative and other services. Clegg was a diligent director. In 2003, the proxy statement report, she attended more than 75% of board and committee meetings. This while she served as the managing partner of Clegg International Consultants, LLC, which she created in 2001, the year she joined the board of IPC. (See Dodd’s public financial disclosure reports with the Senate from 2001-2004 here.)

Dodd is likely more familiar with the complicated workings of AIG than he was letting on last week. This week may provide him with another opportunity to refresh his recollections.

Posted in Campaign 2008, Chuck Norton, Journalism Is Dead, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Democrats Get Their Wish: Children of AIG Employees Threatened

Posted by iusbvision on March 25, 2009

That is not a headline we make lightly, however in this case it is 100% justified.

As we have reported before and have showed you the video (LINK) the Democrats issued not so thinly veiled threats to release the private information of employees who recieved bonuses unless they paid up. Of course, Treasury and the Democrsts negotiated the agreement and wrote the law to guarantee such bonuses all while AIG was giving large donations to the Democratic party, Chris Dodd and Barack Obama.

NBC:

Get the bonus, we will get your children,someone identified only as “Jacob the Killer” hauntingly writes in an e-mail.

— All you motherf***ers should be shot.  Thanks for f***ing up our economy then taking our money.

— Dear Sir: Ya’ll should have the balls and come clean and give back the bonuses. I know you would never do this so the gov’t ought to take you out back and shoot everyone of you crooked sonofb****es…I would be very careful when I went out side. This is just a warning. If I were ya’ll I would be real afraid. Thanks, Bill.

— I don’t hope that bad things happen to the recipients of those bonuses. I really hope that bad things happen to the children and grandchildren of them!  Whatever hurts them the most!!

— You f***ing suck. Paying bonuses to the d*****s that made bad bets losing your company billions of dollars.  I want to f***ing puke.  Publish the list of those yankee scumbags so some good old southern boys can take care of them.

— If the bonuses don’t stop, it will be very likely that every CEO @ AIG has a bulls-eye on their backs.

— We will hunt you down. Every last penny. We will hunt your children and we will hunt your conscience. We will do whatever we can to get those people getting the bonuses.  Give back the money or kill yourselves.

— All the executives and their families should be executed with piano wire around their necks — my greatest hope.

— You mother-f***ing, c***s***ing, d***l****ers need to be taken out one by one and shot in the head. There’s a special place in hell for you pond scum. Watch your backs because someone will come to get you, you can be sure.

— The Revolution is coming. The family members of your executives are not safe. Your blood will run through the streets in the coming months.

Among the documents is an e-mail from an unknown individual, who may be or may have been an employee:  “Just arrived home to several threats on the answering machine.  ‘Give your money back or else,’ terrible things going to happen, etc.  Both private caller numbers.”

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »

Real Capitalism vs. Political Market Capitalism

Posted by iusbvision on March 25, 2009

Will Wilkinson has a great column on real capitalism vs. political market capitalism. This is a valuable lesson that universities should teach, but don’t. This is convenient for politicians because when they engage in political market capitalism, and it all goes to hell, they blame real capitalism for the problem and the solution is of course, more political market capitalism.

Wilkinson excerpt:

wilkinsonPolitical markets — less enabled by government than made by it — operate according to fundamentally different, and less trustworthy, principles. Propped-up by subsidy, structured by central diktat and created ex nihilo by edict, political markets may arise from noble aspirations but in the end are instruments always of the privileged and powerful.

Take contemporary financial markets. (Please!) These are not so much regulated by government oversight as they are constituted by the convoluted web of regulation that dictates who may sell what to whom and on what terms. The shape of our financial markets has emerged from the gradual accretion and rare subtraction of political intervention. But it is now brutally clear that financial markets are not stable simply because they are framed by law and watched by bureaucrats. It is not so hard to see why.

In political markets, the battle for competitive advantage is in part a battle over the rules of the game. That, in turn, is a battle for the hearts of minds of regulators, who generally know less, and are far less motivated, than the industry insiders they regulate. It is no surprise when regulators come to confuse the interests of the powerful (for whom they might someday wish to work, after all) with the interests of the public. As we have recently witnessed, the heavily regulated nature of our financial markets did not keep them from going haywire and taking the entire economy down with them.

Posted in Chuck Norton, Corporatism, Economics 101, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

The Calls Jim Cramer Got Right – suck on this Jon Stewart

Posted by iusbvision on March 22, 2009

Dan Gifford at Big Hollywood has a very fine blog post. It is this kind of excellent work that justifies the blogosphere’s existence as an important journalistic medium.

They describe Jim Cramer predicting what was going to happen. This video is from August 6th 2007 HINT that’s 2007.. “It’s Armageddon”

October 5 – “Take your money out of the stock market now. The stock market will face a 20% decline” 

Be sure to click the Big Hollywood link above to get the rest.

Posted in Chuck Norton, Journalism Is Dead, Leftist Hate in Action, Mortgage Crisis | 1 Comment »

Is the Bail-out mismanagement just a way to nationalize the banks? – UPDATED!

Posted by iusbvision on March 22, 2009

This author is not big on conspiracy theories so it is not our intention to create one. With that said we have been lied to very deliberately about the bailouts while obvious ways to help alleviate the problem are being passed up. People are suffering and there is no honest reason for it. If one had reasons other than the best intentions for the folks, the actions taken by our government make a lot more sense and this writer takes no pleasure in saying it.

Step 1:

Before the first bailout, as we reported HERE, we were told by former Treasury Secretary Hank Paulsen that the billions we spent on the first round of bailouts would be to buy up “at risk mortgages” so the government could renegotiate with the home owners to pay the government back over a longer period. Think of it as like paying a government student loan.

After the money was appropriated by Congress, the government reversed itself and decided that people like you and me who needed some mortgage help weren’t going to get it. Instead the government started picking winners and losers by using your money to buy stock in certain banks, essentially becoming part owners in them. Winner banks often used those billions and to buy up the banks that the government decided to not give money too.

Government is taking increased control over the banks they chose to survive.

There is no way to put this any other way. Your government lied to you.

Step 2:

All of the experts said that suspending the “mark to market rules” would increase the value of mortgage assets to their approximate value instead of a value of ZERO as the rules demand. This way banks would have more assets on balance and not be forced to fail in the numbers that have for being over leveraged.

What are “mark to market rules”?

What it does, according to federal accounting rules, is artificially lower the value of an asset or security that has lost value and artificially inflates an asset’s or security’s value when the market is going up. So when these mortgage securities crashed companies had to say they were worth nothing (because no one wanted to buy them) in spite of the fact that there is a house there that has some value. This problem was a real factor in why things crashed so quickly because it lowered the liquidity rating and solvency rating of those assets artificially.

When the housing market was going up the companies holding them had their rating inflated by them, making it all look dandy on paper and when they crashed they had their rating set artificially low and the company fell below solvency standards.

https://iusbvision.wordpress.com/2008/09/21/in-plain-english-how-did-the-biggest-financial-scandal-in-history-happen/

The experts have been screaming for this one little change, which could be done with the stroke of a pen by the government since September. So why not do this easy fix if almost everyone agrees that this would help a great deal?

This fix, combined with buying up troubled mortgage assets, would have went a long way into bring the banks solvent again, and since the mortgage securities would have value and people would see the light at the end of the tunnel for getting those mortgages paid, the impact on companies like AIG who issued credit default swaps that were harmed by the mortgage securities value being lowered to ZERO would have been mitigated.

Step 3:

As we reported HERE. Between the Federal Reserve, the Treasury and Congress we have spent, or are in the process of spending, $9 trillion on these bailouts; government buying up banks and taking an 80% share of companies like AIG. – UPDATE: now over 12 Trillion – LINK.

This is enough money to pay off 90% of every mortgage in the United States. If government did that instead of what they are doing now it would help bring the banking and credit crisis to an end. But the government didn’t even have to go thar far; like we said if the government had just bought all the at risk mortgages and offered some smart mortgage assistance this would have been a much better solution  than what we have now for regular folks, but it would not have fixed it so the government could take such large ownership stakes and control over the banks.

Step 4:

When the Obama Administration finally got around to talking about helping regular folks like you and me with mortgage assistance, they tossed up a pathetic number like $50 Billion in assistance. The plan is structured so that assistance would mostly go to those who tried to scam the system; those who lied about their income or ability to pay, or those who over leveraged themselves trying to make a fast buck with what is known as “house-flipping”.

This is why Rick Santelli & Larry Kudlow (LINK) and Jim Cramer & Pete Morici (LINK) had a fit, because they knew this plan was bogus and unfair. If you followed the two previous links (and you should and be sure to watch the video’s there) they both say that dealing with the housing issue is the first and highest priority, and that is what is obviously proved to be the governments lowest priority.

Housing is the #1 problem, yet instead of focusing on that they are spending your money to take control of the banks.

Feb 11, we posted this video (LINK) on how to help fix housing:

I loved it, so will you. – This video also tells you step by step – in a fun way, how to fix the housing industry. Any good student of economics can tell you how to do it, so why isn’t Washington even addressing it seriously?

When there are a ton of foreclosures, too much supply, low consumer confidence resulting in low demand how do you fix it – you raise the demand. How do you do that? – Watch this video.

Step 5:

So I have been asking myself, have we been scammed and has the government used this crisis, not to help us, but to help them take over the banks. Keep in mind that Fannie Mae and Freddie Mac were government sponsored enterprises and they are a huge part of the reason why we are in the mess we are now.

I have been considering writing this article for a couple of weeks and then a friend sent me the following link form Bookwormroom.com:

I was doing some research for a post I’m planning, and came upon an articled entitled “The optimal design of Ponzi schemes in finite economies” which Utpal Bhattacharya wrote in 2001 and published in 2002.  The summary reads as follows:

As no rational agent would be willing to take part in the last round in a finite economy, it is difficult to design Ponzi schemes that are certain to explode. This paper argues that if agents correctly believe in the possibility of a partial bailout when a gigantic Ponzi scheme collapses, and they recognize that a bailout is tantamount to a redistribution of wealth from non-participants to participants, it may be rational for agents to participate, even if they know that it is the last round. We model a political economy where an unscrupulous profit-maximizing promoter can design gigantic Ponzi schemes to cynically exploit this “too big to fail” doctrine.We point to the fact that some of the spectacular Ponzi schemes in history occurred at times where and when such political economies existed-France (1719), Britain (1720), Russia (1994), and Albania (1997).

If the language I’ve highlighted sounds familiar, it should, because it accurately predicts both the economic collapse and the bailout mentality that followed. Someone give Bhattacharya a Nobel Prize for economics, because he nailed it.

One can only wonder now if it was pure happenstance that things played out as they did, or if rational actors were gambling on the bailout Bhattacharya predicted. 

WOW!

Step 6:

So does my argument have merit or am I just connecting the dots in a way to put the very worst spin on things and an I being foolish to suspect that the government is using this crisis to take further control of the private sector… I have been asking myself that question for two weeks and then I saw this…..

Now Obama is proposing to take even more control of ALL companies government wishes LINK :

The Obama administration will call for increased oversight of executive pay at all banks, Wall Street firms and possibly other companies as part of a sweeping plan to overhaul financial regulation, government officials said.

The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving U.S. government bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission. Last month, as part of the stimulus package, Congress barred top executives at large banks getting rescue money from receiving bonuses exceeding one-third of their annual pay.

So all of this, $9 Trillion in the hole, plans to take more government control and we STILL have gotten no meaningful mortgage assistance and the housing industry problem has STILL gotten no serious attention. How much help have you gotten from these trillions spent?

UPDATE– Stuart Varney – European Financial news Analyst for Fox News –

UPDATE II The administration came out today with a new plan to help the housing and mortgage industry. It is risky and depends a great deal on the private sector’s willingness to take risk now, but it is a far better plan than the first one they floated. Since the administration put out a plan that can at least be considered seriously the stock market rallied today. We will get more details soon. LINK.

UPDATE III– Eric Cantor released his analysis of the mortgage toxic asset plan as released by Treasury Sec. Tim Geithner. He gives the same analysis that we here at IUSB Vision gave in update II. LINK There is just not enough incentive with this setup for the private investor to take the risk. The other part is that government actions are SO unpredictable lately who wants to risk their money partnering with the feds? They can change the rules of the game and you are powerless.

UPDATE IVNew York Times:

U.S. Seeks Expanded Power to Seize Firms
Goal Is to Limit Risk to Broader Economy

By Binyamin Appelbaum and David Cho
Washington Post Staff Writers
Tuesday, March 24, 2009; A01

The Obama administration is considering asking Congress to give the Treasury secretary unprecedented powers to initiate the seizure of non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy, according to an administration document.

The government at present has the authority to seize only banks.

Giving the Treasury secretary authority over a broader range of companies would mark a significant shift from the existing model of financial regulation, which relies on independent agencies that are shielded from the political process. The Treasury secretary, a member of the president’s Cabinet, would exercise the new powers in consultation with the White House, the Federal Reserve and other regulators, according to the document.

Folks, where are all the far left commenter’s screaming FASCIST? I ask that question because the government is using a crisis to bring the private sector and the banks into the  government. By doing it this way private business keeps its form and appearance while becoming a part of the state. They will be a part of the state because the feds will have such a degree of control, and have such an ability to punish them for political reasons that what ever the government wants to do these parts of the private sector will have little choice but to be cheerleaders for it. Who was the last leader to engage in this kind of behavior?

Mini-UPDATE – Ed Morrissey at Hotair.com comments on this story HERE. Go read it.

Mini-UPDATE II – Speaking of uttering the word fascism, Hotair.com is also reporting that Obama campaign people are going door to door asking people to sign a pledge to him. Let’s put it this way, you are being asked to sign a pledge to a leader with two of his minions at your door.

Mini-UPDATE III – A friend just sent me this video link. Former Clinton Advisor Dick Morris says Obama is trying to get control of the banks. “This is a well thought out plan for bank nationalization”.

UPDATE V – Treasury realeases his proposed legislation to sieze companies it sees as a threat to the economy.

http://www.ustreas.gov/press/releases/tg70.htm

Talk about a plan that is ripe for abuse and what about the constitutions limits on government taking.

Posted in 2012, Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | 3 Comments »

It’s starting. Tent cities popping up.

Posted by iusbvision on March 20, 2009

Posted in Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »

The AIG, Politics of Corruption, Political Money Laundering, and Politics of Distraction Video Roundup!

Posted by iusbvision on March 20, 2009

Update – Newt Gingrich and others are confirming that Treasury and Geithner knew about the bonuses in November. The lies are unfolding fast.

Geithner, Dodd and Reid lied and have been caught.

Folks, CNN and MSNBC’s Chris Mathews were in the tank for the Democrats for years and doubly so in the election. It takes a great deal to get them to get so outraged that they make a paradime shift like this.

Here are two video’s from John Boehner on the House floor These are a MUST SEE – The Republican plan to get the money back is constitutional and would work. The Democrats bill is so royally inconstitutional that there is no way it will hold up in court, this means that the execs in all these companies will keep their bonuses if they wish and contimue to give money to Dodd, Ried, Schumer and Obama. In the second video Boehner is outraged that the Democrsts are pushing a resolution declaring themselves innocent.

Wait till you see these. It is important to watch them in order.

Last but not least. As Republicans fought to protect taxpayers from $350 billion in additional Wall Street bailouts, Democrats assured the American people President Obama would control how taxpayers’ dollars would be spent.

Cong. McCotter – The “shock of the shock speech”  “Every single Democrat in this House that voted for that bill voted to approve and protect those AIG bonuses.”

UPDATE II – CNN takes off the gloves – The Dodd Timeline It;s like we said before. CNN (Lou Dobbs exempted) is perfectly happy to be in the tank for Democrats…until you lie to their face.

Posted in 2012, Campaign 2008, Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

This is bad: Federal Reserve Buys $1 Trillion in Treasury Bonds …..this is why it hurts you. – UPDATED!

Posted by iusbvision on March 19, 2009

UPDATE – Glenn Beck gives this analysis and I must say he did a great job. By the way, when the stack goes from $1 Billion to $1 Trillion, the stacks of money go from single stacked to double stacked. If they stayed single stacked that field of palets of money would be doubled in size.

We have all heard of an IOU, well this is an IO-Me. The dollar fell fast and gold shot up.

When the Federal Reserve/government sells debt they do it with bonds. China, you , me, investors, other banks etc buy these bonds and earn modest interest on them. They have just bought their own bonds which creates money out of thin air. They are taking an ‘IO-Me’ out of one pocket, use that to print up the money and put that money in their other pocket to use and spread around.

This is usually seen in markets as a panic move and makes the dollar worth less.

Bloomberg News:

March 19 (Bloomberg) — The dollar weakened beyond $1.37 against the euro for the first time since January on bets the Federal Reserve’s plan to buy Treasuries will push down yields on U.S. assets and prompt investors to seek returns elsewhere.

The U.S. currency dropped to the lowest versus Norway’s krone since October and depreciated to a two-month low against the Australian dollar as the Fed began flooding the market with greenbacks. Goldman Sachs Group Inc. raised the target on a bet against the dollar to $1.40 versus the euro a day after the greenback fell the most since the single currency’s 1999 debut.

UPDATE II – China calls for new reserve currency (drop the dollar).

Financial Times of London:

China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.

In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency “that is disconnected from individual nations and is able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies”.

Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.

“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Breaking: More Pay to Play. AIG Gave NY Democrats $100k before historic loan!

Posted by iusbvision on March 19, 2009

WNBC:

New York campaign finance records show American International Group donated $100,000 to the state Democratic Committee just before Democratic Gov. David Paterson and his insurance superintendent launched marathon sessions to prop up the embattled insurer.

The contribution was made Aug. 29. Insurance Superintendent Eric Dinallo started negotiating with AIG and federal officials within about two weeks.

On Sept. 16, Paterson announced the “great news” that New York officials helped the giant insurer strike a historic loan deal with the Federal Reserve to keep AIG afloat.

Spokesmen for the state Democratic party, Paterson, Dinallo and AIG had no immediate comment Thursday.

The state’s effort is credited with giving AIG time to survive.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis | Leave a Comment »

Dodd lied – CNN and Fox all over him. Geithner lied – elite media getting wise.

Posted by iusbvision on March 19, 2009

Update – Newt Gingrich and others are confirming that Treasury and Geithner knew about the bonuses in November. The lies are unfolding fast.

Senator Chris Dodd told CNN that he knew nothing about inserting the provision to specifically allow the AIG and other bonuses and as we reported yesterday Dodd has taken massive amounts of cash from AIG and so has President Obama.

Now that the evidence is out, Dodd tells CNN that he was responsible for the language, but Treasury (Tim Geithner) told him to do it.

Now it has come out that Geithner knew about the bonuses 10 days before he said he knew about them. It looks like he is busted too.

Fox News– Sen. Dodd Admits Adding Bonus Provision to Stimulus Package.

In a dramatic reversal Wednesday, Sen. Chris Dodd, D-Conn., confessed to adding language to a spending cap in the stimulus bill last month that specifically excluded executive bonuses included in contracts signed before the bill’s passage.

Dodd told FOX News that Treasury officials forced him to make the change.

 On Tuesday, Dodd told FOX News that he didn’t add the exemption. 

Video: CNN telling GOP leader that Dodd claimed the porson who put the language in is a mystery

CNN’s video and transcript of Sen. Dodd caught flat out in the lie heard round the world at Hotair.com – LINK

Time Magazine and Hotair.com – “Treasury [Geithner] knew about AIG bonuses 10 days sooner than thought” – LINK

Instapundit:

CHRIS DODD spills the beans.

UPDATE: Dodd Facing Fresh Political Firestorm.“Dodd just admitted on CNN that he inserted a loophole in the stimulus legislation that allowed million-dollar bonuses to insurance giant AIG to go forward – after previously denying any involvement in writing the controversial provision.”

The country’s in the very best of hands. . . .

ANOTHER UPDATE: Stephen Spruiell;“Look, it’s hard to have any sympathy for Dodd – the sweetheart mortgage deals, the Irish cottage, the self-righteous grandstanding, etc. And as for the policy at hand, I agree more with Geithner and Summers than Dodd. But as for the politics, this AIG thing is blowing up in Obama’s face, and it looks an awful lot like his administration is trying to make Dodd the fall guy. I’m not so sure Republicans (or conservatives) should help.”

Plus this:“Ed Liddy sized up this situation when he got to AIG and came to the conclusion that the best course for taxpayers and for the financial system was to pay the bonuses. This gets back to something I wrote earlier: If Obama disagrees with Liddy’s decision, he should either A) fire Liddy, or B) fire the guy who hired Liddy (Tim Geithner). What he should not do is go along with this Kabuki outrage, in which official Washington pretends it had no idea that big financial institutions – especially failing ones – might need to keep paying their top employees competitive salaries.”

.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Democrats to AIG: Give back the bonus money or we will release your personal information.

Posted by iusbvision on March 18, 2009

We first reported on the AIG bonus story HERE.

While AIG is getting death threats by the dozens and they read some of those threats at a congressional hearing today including one to wrap piano wire around their throats and killing their children. On the Neil Cavuto show on Fox News a member of the Democratic leadership (Gary Ackerman) when asked if releasing their names and public information is a responsible thing in light of these threats the copngressman said , “Well all they have to do to avoid this is get back the money.”

Folks that is very next to a physical threat of violence. We have said several times that with these new laws undermining ethics procedures that they have sneaked into the Stimulus Bill and other actions, that recent Democrat actions are the things that banana republics are made of.

Republicans are starting to call for Tim Geithner to resign. This is a political play, they should be calling for Chris Dodd to resign and besides, Geithner is a bumbling boob and for the Republicans is the gift that keeps on giving.

Ultimately this is a distraction. Republicans are getting bold enough to hit the Democrats and Democrats who have an unbalanced share in this whole crisis and who are getting enriched by it with campaign kickbacks need some outrage that takes the heat off of themselves. As has been shown in other posts the Democrats knew these bonuses were coming because they stripped out language in the Stimulus Bill to stop them and adden an amendment behind closed doors while locking Republicans out to specifically allow them for companies who took the stimulus funds.

UPDATE – 3/19 Thanks to Hotair for posting the video link.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | 2 Comments »

OUTRAGE: Fannie Mae and Freddie Mac to give 611k bonuses each to execs.

Posted by iusbvision on March 18, 2009

Fannie Mae and Freddie Mac ignored the warnings of their own regulator since 2001. The slicked the palms of partisans and politicians to the tune of $200 million with Chris Dodd and Obama getting the most in order to keep those Democrats blocking any reform. They hired almost every lobby firm in DC to keep other lobby firms from lobbying against them. The people who ran Fannie Mae, Raines, Johnson, Gorelic, are all former Clinton appointees who paid themselves tens of millions of dollars. For decades this was the perfect corruption ring.

For details see our Mortgage Crisis category for our complete coverage on this story since the beginning.

Yahoo/AP News:

WASHINGTON (AP) — Fannie Mae plans to pay retention bonuses of as much as $611,000 each to key executives this year as part of a plan to keep hundreds of employees from leaving the government-controlled company.

Rival mortgage finance company Freddie Mac is planning similar awards, but has not yet reported on which executives will benefit.

The two companies, which together own or back more than half of the home mortgages in the country, have been hobbled by skyrocketing loan defaults. Fannie recently requested $15 billion in federal aid, while Freddie has sought a total of almost $45 billion.

Fannie Mae disclosed its “broad-based” retention program in a recent regulatory filing with the Securities and Exchange Commission. The company was only required to disclose the amounts for the top-paid executives, who will pocket at least $470,000 on top of their base salaries. The bonuses are more than double last year’s, which ranged from $200,000 to $260,000.

A company spokesman declined further comment.

Wall Street Journal is all over it

Ed Morrissey at hotair.com comments HERE (and folks, we link to Ed Morrissey probably more than any other blogger, we do that because among political bloggers Ed is among the very best and brightest).

Posted in 2012, Campaign 2008, Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »

Democrats put language in the ‘Stimulus Bill’ to protect AIG executive bonuses. Dodd and Obama were the number one recipients of money from AIG. Distraction in full swing & Congress’ plan to tax the bonuses at 100% wont pass constitutional muster. – UPDATE: Shep Smith goes off on Congress.

Posted by iusbvision on March 17, 2009

[Before we get in to the goods one thought; what would be the reaction by the Democrats and the elite media be if Bush was still president. – Editor]

This issue is a big distraction and being milked by both sides; but before we get to that lets get to the big news.

Chris Dodd was for the executive bonuses before he was against them.

Senator Chriss Dodd, who was also the number one recipient of campaign cash the corrupt mortgage industry and the member of Congress most responsible for blocking mortgage industry reform since 2001, is also the number one recipient of cash from AIG taking in $103,100 in the 2008 election cycle alone with Barack Obama taking in $101, 332. Like the defunct mortgage industry, AIG gave over three times the donations to Democrats than to Republicans  – LINK.

The Wall Street Journal reports that Senator Dodd’s chances for reelection is in jeopardy.

Democrats inserted the language specifically allowing this in the ‘Stimulus Bill” while Republicans were locked out of conference negotiations, it was called the Dodd Amendment; he first denied this and now admits it and now is trying to spin his way out of it.

Fox Business News:

While the Senate was constructing the $787 billion stimulus last month, Dodd added an executive-compensation restriction to the bill. The provision, now called “the Dodd Amendment” by the Obama Administration, provides an “exception for contractually obligated bonuses agreed on before Feb. 11, 2009” — which exempts the very AIG bonuses Dodd and others are now seeking to tax.

Ok so they sneaked it in and got caught, so the outrage and threats to tax those bonuses at 100% is a show for the press and for you and me. Why?

1. The bonuses are a part of legal contracts so if AIG doesn’t pay them they will be taken to court and forced to pay the bonuses as well as punitive damages and other fees.

2. The Constitution of the United States prohibits the government from interfering with a legal contract. The argument can be made that taxing those bonuses at 100% or a very high rate is an effort to get around that constitutional restriction and they would be right.

3. The Constitution prohibits what are called “Bills of Attainder”. A bill of attainder is a law passsed by congress to punish an individual or a group of people are an imagined crime or wrong doing. This violates a right to a trial and due process of law. Making a special tax for those bonuses now is a bill of attainder and the courts are not going to stand for it.

4. The only way to really solve this is to make new laws for the future or for the industry to reform itself.

Those bonuses are likely to stick and any attempt by Congress to take that money is almost certainly doomed to fail in court. Congress knows this, but like the Rush Limbaugh smear story, the Rick Santelli and Jim Cramer smear stories, these cat fights are distractions that keep the real news from getting to you.

Now both sides are trying to “out outrage the other”. Republicans are talking up outrage against AIG when they should be outraging at Democrats who helped to make sure this could happen with the language in the Stimulus Bill. The mortgage industry scandal shows us that much of the Democratic Party leadership is in Wall Street’s back pocket and this scandal is just more reason to come to that conclusion.

Michelle Malkin comments HERE.

UPDATE – Video: Shep Smith goes OFF on this pure show and deception & tells you what we have told you from minute one.

As we told you this AIG media and political frenzy is about two things, a distractions that the Democrats screwed up, and a distraction from the fact that Democrats have been getting money funneled back to their campaigns from AIG, Wall Street firms and the mortgage industry. The video:

UPDATE II – CBS news decided not to mention the Dodd Amendment in its coverage…is anyone surprised? – LINK

Posted in 2012, Big Bizz Loves Big Govt, Campaign 2008, Chuck Norton, Journalism Is Dead, Mortgage Crisis | 2 Comments »

VP Cheney & Karl Rove: Chris Dodd & Barney Frank Prevented Mortgage Reform – UPDATE: AP Misreports Story

Posted by iusbvision on March 16, 2009

VP Cheney –

Karl Rove tells the world what we all already know about Frank and Dodd.

UPDATE – The Associated Press – in the tank as they usually are make no mention of what Cheney and Rove had to say about Frank & Dodd. What a surprise they left out the lead of the story…. 

Cheney: Don’t blame Bush team for economic woes
Sunday March 15, 9:13 am ET

Cheney says economic woes are not Bush team’s fault, cites global financial problem

WASHINGTON (AP) — Don’t blame the Bush administration for all the country’s economic problems.That’s the message from former Vice President Dick Cheney.

President Barack Obama constantly talks about the enormous economic troubles that he inherited when he took office in January. Cheney agrees that Obama did indeed came into power amid very difficult economic circumstances.

But Cheney says he doesn’t think the Bush administration can be blamed for creating the economic woes. Cheney says it’s a global financial problem. He says the idea that fault can assigned to the previous administration is “interesting rhetoric” but he doesn’t think people care about that.

Cheney spoke on CNN’s “State of the Union.”

http://biz.yahoo.com/ap/090315/cheney_economic_woes.html

Posted in Chuck Norton, Journalism Is Dead, Mortgage Crisis | Leave a Comment »

Obama Below Bush’s 2001 Approval – Newsweek Explains Why.

Posted by iusbvision on March 15, 2009

Obama’s poll numbers are sinking fast in spite of a media who is being pretty kind to him considering the chain of blunders that has come since January 20 [folks thats not me being partisan – we can list them].

It is so bad that Newsweek Magazine, which has decided to go hard left by decided to do less hard news and team with Air America has been pretty tough on the admisnistration and explained why.

Read what Scott Rasmussen  has to say carefully.

Scott Rasmussen in WSJ:

It is simply wrong for commentators to continue to focus on President Barack Obama’s high levels of popularity, and to conclude that these are indicative of high levels of public confidence in the work of his administration. Indeed, a detailed look at recent survey data shows that the opposite is most likely true. The American people are coming to express increasingly significant doubts about his initiatives, and most likely support a different agenda and different policies from those that the Obama administration has advanced.

Polling data show that Mr. Obama’s approval rating is dropping and is below where George W. Bush was in an analogous period in 2001. Rasmussen Reports data shows that Mr. Obama’s net presidential approval rating — which is calculated by subtracting the number who strongly disapprove from the number who strongly approve — is just six, his lowest rating to date.

Overall, Rasmussen Reports shows a 56%-43% approval, with a third strongly disapproving of the president’s performance. This is a substantial degree of polarization so early in the administration. Mr. Obama has lost virtually all of his Republican support and a good part of his Independent support, and the trend is decidedly negative.

A detailed examination of presidential popularity after 50 days on the job similarly demonstrates a substantial drop in presidential approval relative to other elected presidents in the 20th and 21st centuries. The reason for this decline most likely has to do with doubts about the administration’s policies and their impact on peoples’ lives.

There is also a clear sense in the polling that taxes will increase for all Americans because of the stimulus, notwithstanding what the president has said about taxes going down for 95% of Americans. Close to three-quarters expect that government spending will grow under this administration.

Recent Gallup data echo these concerns. That polling shows that there are deep-seated, underlying economic concerns. Eighty-three percent say they are worried that the steps Mr. Obama is taking to fix the economy may not work and the economy will get worse. Eighty-two percent say they are worried about the amount of money being added to the deficit. Seventy-eight percent are worried about inflation growing, and 69% say they are worried about the increasing role of the government in the U.S. economy.

When Gallup asked whether we should be spending more or less in the economic stimulus, by close to 3-to-1 margin voters said it is better to have spent less than to have spent more. When asked whether we are adding too much to the deficit or spending too little to improve the economy, by close to a 3-to-2 margin voters said that we are adding too much to the deficit.

Support for the stimulus package is dropping from narrow majority support to below that. There is no sense that the stimulus package itself will work quickly, and according to a recent Wall Street Journal/NBC poll, close to 60% said it would make only a marginal difference in the next two to four years. Rasmussen data shows that people now actually oppose Mr. Obama’s budget, 46% to 41%. Three-quarters take this position because it will lead to too much spending. And by 2-to-1, voters reject House Speaker Nancy Pelosi’s call for a second stimulus package.

This news is simply devastating for a new administration, but as Newsweek will explain below, they really have made their own bed to sleep in. Expect Obama to ramp up his campaign machine to sell his new budget which will push Obama’s spending in the first two years of his presidency to greater than that of every administration before him combined. It is likely that this upcemong campaign to sell the budget will be just a sdeceptive as his campaign to sell the porkulus but I believe people are getting wise. Shoprtly after Obama’s speech to the nation in front of Congress he pragged about how there was no earmarks (it had tons of pork they jsut appropriated the earmark spending in a different way to it technically wasn’t an earmark) then a few days later he signed another $411 billion spending bill with almost 9,000 earmarks. While not all earmarks are bad, most are unnecessary and the earmark system invites corruption.

Read what Newsweek has to say carefully. Notice it is from five days ago and they saw this coming:

A Turning Tide?

Obama still has the approval of the people, but the establishment is beginning to mumble that the president may not have what it takes.

  • The $787 billion stimulus, gargantuan as it was, was in fact too small and not aimed clearly enough at only immediate job-creation.
  • The $275 billion home-mortgage-refinancing plan, assembled by Treasury Secretary Tim Geithner, is too complex and indirect.
  • The president gave up the moral high ground on spending not so much with the “stim” but with the $400 billion supplemental spending bill, larded as it was with 9,000 earmarks.
  • The administration is throwing good money after bad in at least two cases-the sinkhole that is Citigroup (there are many healthy banks) and General Motors (they deserve what they get).
  • The failure to call for genuine sacrifice on the part of all Americans, despite the rhetorical claim that everyone would have to “give up” something.
  • A willingness to give too much leeway to Congress to handle crucial details, from the stim to the vague promise to “reform” medical care without stating what costs could be cut.
  • A 2010 budget that tries to do far too much, with way too rosy predictions on future revenues and growth of the economy. This led those who fear we are about to go over Niagara Falls to deride Obama as a paddler who’d rather redesign the canoe.
  • A treasury secretary who has been ridiculed on “Saturday Night Live” and compared to Doogie Howser, Barney Fife and Macaulay Culkin in “Home Alone”-and those are the nice ones.
  • A seeming paralysis in the face of the banking crisis: unwilling to nationalize banks, yet unable to figure out how to handle toxic assets in another way-by, say, setting up a “bad bank” catch basin.
  • A seeming reluctance to seek punishing prosecutions of the malefactors of the last 15 years-and even considering a plea bargain for Bernie Madoff, the poster thief who stole from charities and Nobel laureates and all the grandparents of Boca. Yes, prosecutors are in charge, but the president is entitled-some would say required-to demand harsh justice.
  • The president, known for his eloquence and attention to detail, seemingly unwilling or unable to patiently, carefully explain how the world works-or more important, how it failed. Using FDR’s fireside chats as a model, Obama needs to explain the banking system in laymen’s terms. An ongoing seminar would be great.
  • Obama is no socialist, but critics argue that now is not the time for costly, upfront spending on social engineering in health care, energy or education.

Other than all that, in the eyes of the big shots, he is doing fine.

 Ouch.. and that is from a source that is heavily biased towards him. Now just imagine what the elite media would be saying about President Bush if he had amassed a two month record that included this list. Would it lead the evening news, would all the talking heads on the news show be repeating the same talking points verbatim, would the message be delivered over and over and over again…. or would it just be printed in one small column in Newsweek and all but ignored afterwards?

Posted in 2012, Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Jim Cramer – My Response to White House Attacks

Posted by iusbvision on March 8, 2009

As you may know, Jim Cramer, who was an Obama supporter, has come under attack by the White House for stating the obvious. Obama campaigned as a moderate and his policies are far left, wealth destroying ideological nonsense that is ruining peoples retirements and financial security.

CNBC’s Jim Cramer:

cramer2-frontWhen I come to work each day, whether as a commentator for TheStreet.com or a host of Mad Money With Jim Cramer, I have only one thought in mind: helping people with their money.

I fight to help viewers and readers make and preserve capital. I fight for their 401(k)s, for their 529s and their IRAs. I fight for their annuities and for their life insurance policies. I fight for their profits, trading and investing. And in this horrible market, I fight to keep their losses to a minimum by having some good dividend-yielding stocks from different sectors, some bonds, some gold and some cash.

The lines are drawn pretty clearly: If you can help people make money to be able to retire, enjoy life, pay for college, pay down debt, etc., you are a “good guy,” so to speak. If you take the other side of the trade, you are, well, let’s say, a less favored fellow. And if you gun for the gigantic investor class that is out there that includes 90 million people in one form or another, whether it be 401(k)s or individual stocks or pension plans, then you are on my enemies list.

Now some, including Rush Limbaugh, would say I am on another enemies list: that of the White House. Limbaugh says there are only a handful of us on it, and if I am on it for defending all of the shareholders out there, then I am in good company. Limbaugh — whom I do not know personally, but having been in radio myself, know professionally as a genius of the medium — says, “They’re going to shut Cramer up pretty soon, too, but he’ll go down with a fight.”

Limbaugh’s dead right. I am a fight-not-flight guy, so I was on my hackles when I heard White House Press Secretary Robert Gibbs’ answer to a question about my pointed criticism of the president on multiple venues, including the Today Show.

“I’m not entirely sure what he’s pointing to to make some of the statements,” Gibbs said about my point that President Obama’s budget may be one of the great wealth destroyers of all time. “And you can go back and look at any number of statements he’s made in the past about the economy and wonder where some of the backup for those are, too.”

Huh? Backup? Look at the incredible decline in the stock market, in all indices, since the inauguration of the president, with the drop accelerating when the budget plan came to light because of the massive fear and indecision the document sowed: Raising taxes on the eve of what could be a second Great Depression, destroying the profits in healthcare companies (one of the few areas still robust in the economy), tinkering with the mortgage deduction at a time when U.S. house price depreciation is behind much of the world’s morass and certainly the devastation affecting our banks, and pushing an aggressive cap and trade program that could raise the price of energy for millions of people.

The market’s the effect; much of what the president is fighting for is the cause. The market’s signal can’t be ignored. It’s too palpable, too predictive to be ignored, despite the prattle that the market’s predicted far more recessions than we have.

Gibbs went on to say, “If you turn on a certain program, it’s geared to a very small audience. No offense to my good friends or friend at CNBC, but the president has to look out for the broader economy and the broader population.”

How much I wish it were true right now that stocks played less of a role in peoples’ lives. But stocks, along with housing, are our principal forms of wealth in this country. Only the people who have lifetime tenure, insured solid pensions and rent homes but own no stocks personally are unaffected. Sure that’s a lot of people, but believe me, they aspire to have homes and portfolios. If we only want to help those who have no wealth to destroy, we are not helping the majority of Americans; we are not helping the broader population.

You can argue, of course, that Obama inherited one of the worst hands in the world. I had been a relentless critic of the Bush administration’s “stewardship” of the economy, calling repeatedly for changes to avert the disaster that I saw coming, although perhaps Gibbs hasn’t seen my CNBC meltdown. Seemed pretty prescient to me.

I, like everyone else, have made less authoritative and wrong statements in the past, but that rant still stands as something that I am sure everyone in the Bush administrations’ Treasury and Fed listened to. My calls to sell 20% of your stocks in September at Dow 11,000 and then all of your stock if you need the money for the next five years at Dow 10,000 in October, might have eluded Gibbs, too.

But Obama has undeniably made things worse by creating an atmosphere of fear and panic rather than an atmosphere of calm and hope. He’s done it by pushing a huge amount of change at a very perilous moment, by seeking to demonize the entire banking system and by raising taxes for those making more than $250,000 at the exact time when we need them to spend and build new businesses, and by revoking deductions for funds to charity that help eliminate the excess supply of homes.

We had a banking crisis coming into this regime, but now every area is in crisis. Each day is worse than the previous one for this miserable economy and while Obama’s champions cite the stimulus plan, it’s really just a hodgepodge of old Democratic pork and will not create nearly as many manufacturing or service jobs as we hoped. China’s stimulus plan is the model; ours is the parody.

Sure there’s going to be some mortgage relief, but the way to approach that problem is to eliminate the overhang, which a $15,000 tax credit for existing home sales could have dented if not consumed. I have offered a comprehensive plan of 4% refinanced mortgages for all by the government, not just those many considered deadbeats, to eliminate moral hazard. I have come up with a novel plan to cut the principal and spare the banks regulatory problems by offering them a certificate of equity, making them whole over time when the house appreciates in value, which will happen if demand is stoked and supply is shrunk.

I have offered a comprehensive bank plan to solve a systemic problem — could all bankers really be malefactors of wealth, Mr. President, or given the endemic nature can’t we just presume that it’s an epidemic and finger-pointing is a worthless endeavor until things get better? Like after Pearl Harbor — let’s win the war and then investigate, and even try and convict the bad actors, instead of demonizing everyone who works at a bank right now, when we need them to right themselves without too much taxpayer help.

Which leads me to the true irony of not being political: I don’t like talking politics. It is personal, but some things are a matter of public record, including my substantial six figure donations to the Democratic Party before I was no longer allowed to contribute by contractual agreement. I regard two Democratic governors as my friends, and helped back one of them in a major financial way and spoke and campaigned directly for the other.

I also made it clear in a New York magazine article that I favored Obama over McCain because I thought Obama to be a middle-of-the-road Democrat, exactly the kind I have supported all my adult life, although I will admit to being far more left-wing during my teenage years and early 20s.

To be totally out of the closet, I actually embrace every part of Obama’s agenda, right down to the increase on personal taxes and the mortgage deduction. I am a fierce environmentalist who has donated multiple acres to the state of New Jersey to keep forever wild. I believe in cap and trade. I favor playing hardball with drug companies that hold up the U.S. government with me-too products.

But these are issues that we have no time for now, on the verge of a second Great Depression. This is an agenda that must be held back for better times. It is an agenda that at this moment is radical vs. what is called for. I am proud to have voted for the Obama who I thought understood the need to get us on the right path, and create jobs and wealth before taxing it and making moves that hurt job creation — certainly ones that will outweigh the meager number of jobs he’s creating.

Most important, I believe his agenda is crushing nest eggs around the nation in loud ways, like the decline in the averages, and in soft but dangerous ways, like in the annuities that can’t be paid and the insurance benefits that will be challenging to deliver on.

So I will fight the fight against that agenda. I will stand up for what I believe and for what I have always believed: Every person has a right to be rich in this country and I want to help them get there. And when they get there, if times are good, we can have them give back or pay higher taxes. Until they get there, I don’t want them shackled or scared or paralyzed. That’s what I see now.

If that makes me an enemy of the White House, then call me a general of an army that Obama may not even know exists — tens of millions of people who live in fear of having no money saved when they need it and who get poorer by the day.

Posted in 2012, Campaign 2008, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Dow Below 7,000, Government Economists Proved Wrong, Government Policy is Destroying Wealth.

Posted by iusbvision on March 3, 2009

Glenn Beck shows you quotes from those who said nothing was wrong.

Every new policy designed to grow government and redistribute wealth that Obama announced causes the market to tank even more. It is important to understand what is happening. Peoples retirement’s and investments are being destroyed. This works to destroy the middle class and make them dependent on government payments.

Glenn Beck is the third highest rated show on cable television.

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Speech Reaction: AP slams Obama for dishonesty, Byrd says “Obama Grab for Power”, Stock Market Drops, Dem Governor May Turn Down Stimulus Funds

Posted by iusbvision on February 25, 2009

Stock Market:

feb25-stocks

 

Associated Press:

FACT CHECK: Obama’s words on home aid ring hollow

Feb 25, 3:15 AM (ET)

By CALVIN WOODWARD and JIM KUHNHENN

WASHINGTON (AP) – President Barack Obama knows Americans are unhappy that the government could rescue people who bought mansions beyond their means.

But his assurance Tuesday night that only the deserving will get help rang hollow.

Even officials in his administration, many supporters of the plan in Congress and the Federal Reserve chairman expect some of that money will go to people who used lousy judgment.

The president skipped over several complex economic circumstances in his speech to Congress – and may have started an international debate among trivia lovers and auto buffs over what country invented the car.

A look at some of his assertions:

OBAMA: “We have launched a housing plan that will help responsible families facing the threat of foreclosure lower their monthly payments and refinance their mortgages. It’s a plan that won’t help speculators or that neighbor down the street who bought a house he could never hope to afford, but it will help millions of Americans who are struggling with declining home values.”

THE FACTS: If the administration has come up with a way to ensure money only goes to those who got in honest trouble, it hasn’t said so.

Defending the program Tuesday at a Senate hearing, Federal Reserve Chairman Ben Bernanke said it’s important to save those who made bad calls, for the greater good. He likened it to calling the fire department to put out a blaze caused by someone smoking in bed.

“I think the smart way to deal with a situation like that is to put out the fire, save him from his own consequences of his own action but then, going forward, enact penalties and set tougher rules about smoking in bed.”

Similarly, the head of the Federal Deposit Insurance Corp. suggested this month it’s not likely aid will be denied to all homeowners who overstated their income or assets to get a mortgage they couldn’t afford.

“I think it’s just simply impractical to try to do a forensic analysis of each and every one of these delinquent loans,” Sheila Bair told National Public Radio.

OBAMA: “And I believe the nation that invented the automobile cannot walk away from it.”

THE FACTS: Depends what your definition of automobiles, is. According to the Library of Congress, the inventor of the first true automobile was probably Germany’s Karl Benz, who created the first auto powered by an internal combustion gasoline engine, in 1885 or 1886. In the U.S., Charles Duryea tested what library researchers called the first successful gas-powered car in 1893. Nobody disputes that Henry Ford created the first assembly line that made cars affordable.

OBAMA: “We have known for decades that our survival depends on finding new sources of energy. Yet we import more oil today than ever before.”

THE FACTS: Oil imports peaked in 2005 at just over 5 billion barrels, and have been declining slightly since. The figure in 2007 was 4.9 billion barrels, or about 58 percent of total consumption. The nation is on pace this year to import 4.7 billion barrels, and government projections are for imports to hold steady or decrease a bit over the next two decades.

OBAMA: “We have already identified $2 trillion in savings over the next decade.”

THE FACTS: Although 10-year projections are common in government, they don’t mean much. And at times, they are a way for a president to pass on the most painful steps to his successor, by putting off big tax increases or spending cuts until someone else is in the White House.

Obama only has a real say on spending during the four years of his term. He may not be president after that and he certainly won’t be 10 years from now.

OBAMA: “Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn’t afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.”

THE FACTS: This may be so, but it isn’t only Republicans who pushed for deregulation of the financial industries. The Clinton administration championed an easing of banking regulations, including legislation that ended the barrier between regular banks and Wall Street banks. That led to a deregulation that kept regular banks under tight federal regulation but extended lax regulation of Wall Street banks. Clinton Treasury Secretary Robert Rubin, later an economic adviser to candidate Obama, was in the forefront in pushing for this deregulation.

OBAMA: “In this budget, we will end education programs that don’t work and end direct payments to large agribusinesses that don’t need them. We’ll eliminate the no-bid contracts that have wasted billions in Iraq, and reform our defense budget so that we’re not paying for Cold War-era weapons systems we don’t use. We will root out the waste, fraud and abuse in our Medicare program that doesn’t make our seniors any healthier, and we will restore a sense of fairness and balance to our tax code by finally ending the tax breaks for corporations that ship our jobs overseas.”

THE FACTS: First, his budget does not accomplish any of that. It only proposes those steps. That’s all a president can do, because control over spending rests with Congress. Obama’s proposals here are a wish list and some items, including corporate tax increases and cuts in agricultural aid, will be a tough sale in Congress.

Second, waste, fraud and abuse are routinely targeted by presidents who later find that the savings realized seldom amount to significant sums. Programs that a president might consider wasteful have staunch defenders in Congress who have fought off similar efforts in the past.

OBAMA: “Thanks to our recovery plan, we will double this nation’s supply of renewable energy in the next three years.”

THE FACTS: While the president’s stimulus package includes billions in aid for renewable energy and conservation, his goal is unlikely to be achieved through the recovery plan alone.

In 2007, the U.S. produced 8.4 percent of its electricity from renewable sources, including hydroelectric dams, solar panels and windmills. Under the status quo, the Energy Department says, it will take more than two decades to boost that figure to 12.5 percent.

If Obama is to achieve his much more ambitious goal, Congress would need to mandate it. That is the thrust of an energy bill that is expected to be introduced in coming weeks.

OBAMA: “Over the next two years, this plan will save or create 3.5 million jobs.”

THE FACTS: This is a recurrent Obama formulation. But job creation projections are uncertain even in stable times, and some of the economists relied on by Obama in making his forecast acknowledge a great deal of uncertainty in their numbers.

The president’s own economists, in a report prepared last month, stated, “It should be understood that all of the estimates presented in this memo are subject to significant margins of error.”

Beyond that, it’s unlikely the nation will ever know how many jobs are saved as a result of the stimulus. While it’s clear when jobs are abolished, there’s no economic gauge that tracks job preservation. The estimates are based on economic assumptions of how many jobs would be lost without the stimulus.

Senator Byrd:

Sen. Robert Byrd (D-W.Va.), the longest-serving Democratic senator, is criticizing President Obama’s appointment of White House “czars” to oversee federal policy, saying these executive positions amount to a power grab by the executive branch.

In a letter to Obama on Wednesday, Byrd complained about Obama’s decision to create White House offices on health reform, urban affairs policy, and energy and climate change. Byrd said such positions “can threaten the Constitutional system of checks and balances. At the worst, White House staff have taken direction and control of programmatic areas that are the statutory responsibility of Senate-confirmed officials.”

While it’s rare for Byrd to criticize a president in his own party, Byrd is a stern constitutional scholar who has always stood up for the legislative branch in its role in checking the power of the White House. Byrd no longer holds the powerful Appropriations chairmanship, so his criticism does not carry as much weight these days. Byrd repeatedly clashed with the Bush administration over executive power, and it appears that he’s not limiting his criticism to Republican administrations.

Byrd also wants Obama to limit claims of executive privilege while also ensuring that the White House czars don’t have authority over Cabinet officers confirmed by the Senate.

Tennessee may reject stimulus aid for jobless:

Tennessee could reject a portion of the $787 billion economic stimulus package out of concerns that it would force the state to raise taxes on businesses in the future.

At the National Governors Association meetings in Washington, D.C., Gov. Phil Bredesen said this week that he might turn down relief for unemployed workers worth an estimated $143 million because of conditions placed on the money by Congress.

The stimulus package would also raise unemployment benefits by $25 a week for all workers, but in addition, lawmakers want states to expand the pool of people who can apply for benefits. That would put more pressure on an unemployment trust fund that is already trying to stave off insolvency.

[GOP governers have also considered rejecting the funds because once the money from the feds runs out the conditions tied to the money becomes a very expensive unfunded mandate – Editor]

Posted in Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Editor’s reaction to the speech – Open letter to President Obama.

Posted by iusbvision on February 24, 2009

Mr. President,

It was a great speech you made to Congress as it contained goals that every American can get behind. Understanding that America is a center-right nation you even managed to couch your plans using conservative rhetoric.

The problem is the legislation that you and the Democrats are proposing/have proposed does not do enough to empower regular folks; rather it empowers government and special interest constituent groups that will kick back millions to the Democratic Party.

You have reneged on your repeated pledges of transparency (1, 2, 3, 4, 5,) and several other issues.

You bragged that your stimulus bill had no “earmarks” yet your own Senator Schumer has stated that the stimulus bill was filled with “porky amendments”. The AP, whose coverage was very sympathetic to your candidacy, has said that you are being deceptive.

To pay for some of that pork a much-needed tax break for home buyers was dropped from the bill. While there are some good things in the bill like the American Opportunity Tax Credit that is intended to give a tax break to working families who have a family member going back to college I am very concerned that for the expense, there is not enough good and too much of the old politics as usual.

You promised to put legislation up on the internet for 2-5 days before it is voted on. Starting with bill number one (HR1) that promise was broken. You promised a new era of bipartisanship and then locked Republicans out of the bill negotiations. The final version only came out a few hours before the vote, but your lobbyist special interest friends got copies of the “porky”, special interest lined stimulus bill before most members of Congress even saw the final version.

You talk about individual and government responsibility yet snuck in language to reverse the hugely successful welfare reform program to the stimulus without telling anyone.

Your wife Michelle criticized one of the Bush tax cuts because it returned $600 to the taxpayer. The tax cut (or more accurately stated “your tax deduction table modification” as the tax rate was never changed) you bragged about that was in the “porky” stimulus bill averages out to $13 a week, which totals $676.

According the analysts from Bloomberg, Fox, universities, and even NBC (1, 2, 3,),  who has been in the tank for you more than any other media outlet, your stimulus program does not do much to create jobs and will cost well over $200,000 per job it does create. Some of these same analysts say that your mortgage plan is wrong-headed, isn’t comprehensive, and mostly supports the few who are the least deserving of help.

You keep saying that Republicans want to do nothing when you know that every Republican in the Senate voted for an alternative bill that was so good when it was ran through the economic model that YOUR administration uses it created twice the jobs with half the money.

You talk about improving education, but not only did you pick a Secretary of Education who is not addressing the real issues in education, your party is proposing legislation to ban the school voucher program in Washington  DC which has been saving inner city kids from public schools that have failed them utterly. Apparently voucher programs aren’t very effective at tossing money to teachers unions, however, they are effective at giving inner city kids a fighting chance to succeed. That same bill has $410 billion in more big government spending with thousands of earmarks which we all learned from the campaign are a part of an appropriations process that is often corrupted and abused. Didn’t you say in the campaign that you would go through these kinds of bills line by line?

You hold a “Fiscal Responsibility Summit” and special interests were all over it. You have appointed lobbyists all over your administration after promising not to (1, 2, 3).

The tax hike idea that you brag “will only impact those who make over $250,000” will largely impact small to medium-sized business “S-Corporations” which will kill jobs, raise prices, and push more small to medium-sized domestic competition out of the competition. In the mean time the genuine super rich will hardly notice the difference.  The “super rich” like John Kerry and other mega millionaires/billionaires make money in many ways that are not considered “earned income” and enjoy countless favors in a tax-code making it so thick it is measured in feet. For example: John Kerry made $5,072,000 in 2003 and had a total federal tax burden of 12.34%. You know as well as I that those like the Kerry’s will NOT be paying a genuine 39.6% rate as you plan to force productive wage earners and small business to pay (see Norton’s First Law).

While the government is/and is about to send trillions of dollars to Wall Street (2), since 2005 you have taken more money from Wall Street, Fannie Mae and the defunct Lehman Brothers (2, 3) than anyone.

The word disappointed hardly covers it.

Chuck Norton
Editor, IUSB Vision Web Log

Posted in Campaign 2008, Chuck Norton, Government Gone Wild, Mortgage Crisis, Obama and Congress Post Inaugration, Other Links, True Talking Points | 7 Comments »

Cramer and Morici – Why the Stimulus and Obama’s Mortgage Plan Won’t Work.

Posted by iusbvision on February 24, 2009

UPDATE March 2011 – Cramer said that a plan had a chance at working if there is a system to help the toxic assets with mortgage holders and the banks. It didn’t happen so the hope he mentioned has been dashed. At 2:30 Cramer starts talking about what Obama should have done with the banking plan. Cramer nailed it, why Obama didn’t do this….. well Dick Morris understands why. Look him up in our “Mortgage Crisis” category.

Jim Cramer and University of Maryland economist Pete Morici explain why the stimulus plan wont create many jobs and why Obama’s Mortgage Plan takes the wrong approach and wont help the housing market. Jim Cramer is one of the people who was talking about this crisis pretty far in advance.

Essentially Rick Santelli is right that the plan needs to help all Americans not just constituent groups who got subprimes that they had no chance of ever paying off  or rich borrowers who got caught while trying to “flip” multiple houses. See What Rick has to say HERE, it is essentially the same thing that Jim Cramer and Dr. Morici are saying in the video above. It is also what we at IUSB Vision have been saying since Feburary 3rd.

There are also some lenders who had balloon payments or a balloon interest rate in some loans guaranteeing that the buyer would default. Those lenders should be prosecuted.

Santelli, Cramer, Mirici and IUSB Vision are not alone in our thinking.

Bloomberg Financial News:

Mortgage Plan Aids Liars About Income, Amherst Says
By Jody Shenn

Feb. 20 (Bloomberg) — The Obama administration’s mortgage- modification plan offers the most aid to homeowners who “really stretched to buy their house and lied the most about their income,” Amherst Securities Group LP analysts said.

The plan calls for government payments before and after loans are reworked to mortgage servicers and lenders including mortgage-securities investors, as well as borrowers, Amherst’s Laurie Goodman and Roger Ashworth wrote in a report today. The proposal also will “badly misalign” the incentives of servicers and bondholders, they wrote.

“This program needs to be retooled,” the New York-based mortgage-bond analysts wrote. Amherst is a securities firm specializing in trading and advising investors on home-loan debt.

Under Obama’s plan, a borrower who qualified for a 6 percent interest-only “stated income” loan of $250,000 by claiming income of $45,000 a year while actually making $37,500 would see payments cut by $2,625 annually through lender and government subsidies, according to their report. A borrower who actually made $30,000 while claiming to make $45,000 would pay $5,700 less a year to meet the debt-to-income ratios sought.

“The borrowers that really stretched to buy their house and lied the most about their income receive the largest break in payments,” the analysts wrote.

This is why Santelli had a cow on the air and did his rant. Those who cheated on the bottom end and on the top end will benefit the most, those of us who cut back and struggled to barely keep up with mortgage payment’s get the shaft.

It’s a PITI — Why Obama’s Mortgage Plan Doesn’t Work by Mark Lieberman

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Is Obama TRYING to trash our economy?? Plans to raise taxes on small business.

Posted by iusbvision on February 23, 2009

In previous posts we have explained how President Hoover tried to tax and spend and protectionist his way out of a recession that became the Great Depression. Then we explained how FDR and the New Deal continued many of those policies and the result was that unemployment never dropped below 20% until World War II an FDR’s own Treasury Secretary explained how the policy was a failure.

Now Obama wants to raise income taxes and capital gains taxes. Folks, this is a disaster in the making. It is a disincentive for people to invest and it will lower the amount of revenue that will come into the government.

The Obama spin will be that this is just on “the rich”. This is a lie. The tax will hit high wage earners but there aren’t that many of them. The vast majority of those who will be hit by this are Sub. S Corporations. Sub S. Corporations pay the top marginal rate rather than the corporate income tax rate because they are small businesses. Small business does most of the buying and selling and they create 75% of the jobs in this country.

What about the rich? The “rich” like John Kerry and other hyper millionaires/billionaires make money in many ways that are not considered “earned income”. For example: John Kerry made $5,072,000 in 2003 and had a total federal tax burden of 12.34% (See Norton’s First Law).

American small and medium sized businesses pays ridiculously high taxes now and far more than most of the industrialized world. Now Obama wants them to pay 40%. This is a perscription for more unemployment and higher prices for all of us.

Obama’s First Budget Seeks To Trim Deficit
Plan Would Cut War Spending, Increase Taxes on the Wealthy

By Lori Montgomery and Ceci Connolly
Washington Post Staff Writers
Sunday, February 22, 2009; A01

To get there, Obama proposes to cut spending and raise taxes. The savings would come primarily from “winding down the war” in Iraq, a senior administration official said. The budget assumes continued spending on “overseas military contingency operations” throughout Obama’s presidency, the official said, but that number is lower than the nearly $190 billion budgeted for Iraq and Afghanistan last year.

Obama also seeks to increase tax collections, mainly by making good on his promise to eliminate some of the temporary tax cuts enacted in 2001 and 2003. While the budget would keep the breaks that benefit middle-income families, it would eliminate them for wealthy taxpayers, defined as families earning more than $250,000 a year. Those tax breaks would be permitted to expire on schedule in 2011. That means the top tax rate would rise from 35 percent to 39.6 percent, the tax on capital gains would jump to 20 percent from 15 percent for wealthy filers and the tax on estates worth more than $3.5 million would be maintained at the current rate of 45 percent.

Obama also proposes “a fairly aggressive effort on tax enforcement” that would target corporate loopholes, the official said. And Obama’s budget seeks to tax the earnings of hedge fund managers as normal income rather than at the lower 15 percent capital gains rate.

http://www.washingtonpost.com/wp-dyn/content/article/2009/02/21/AR2009022100911_pf.html

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Just how much trouble is our economy in?

Posted by iusbvision on February 22, 2009

Our debt and federal obligations now exceed world GDP.

Our idiotic government is “monetizeing” the debt – if you don’t know how bad this is, watch this video:

Posted in Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | Leave a Comment »

Rick Santelli Explains What is Wrong with Obama’s Mortgage Plan

Posted by iusbvision on February 22, 2009

This idea that we should only help those with mortgages who are behind on their payments is nuts. My family is struggling just like so many others and is on the edge between making payments and not making them.

Everyone deserves some mortgage relief if the government is going to do this.

Why? Because a great many of these mortgages were with people who were buying homes they could not afford, or extra homes in order to “flip them” in 2-3 years in order to make a fast buck. They got caught when the housing market crashed. Are these the people you want to bail out and benefit at the cost of YOUR mortgage going up? Go through bankruptcy judges Obama says?? So if your in trouble and broke how are you supposed to hire a lawyer???

This Obama plan stinks and as it stands now, as broke as I am, it is not going to help me. It is not going to help most people who are cutting back and struggling to make their mortgage payments.

As far as Larry Kudlow’s complaint about the White House Press Secretary attacking a member of the media, he is only partially correct. When the media acts responsibly as Santelli is and honestly critiquing the Obama plan Kudlow is correct, but when the media acts as a partisan instrument that is out to destroy you as was the case during the Bush Administration, they should have done what Tony Snow started to do and amp it up; call out media instruments that are ridiculously partisan, biased, hateful and unfair as the New York Times was to Snow, McCain, Palin, and the Bush Administration. The best way to fight the abuse of free speech by the elite media is more speech, not less.

Posted in Chuck Norton, Mortgage Crisis, Obama and Congress Post Inaugration | 1 Comment »