February 28, 2009
Come on, Mr. President!
Here's the thing... we need real regulatory reform and enforcement in financial services. This is not so much a good start, Mr. President.
February 27, 2009
Still no relief for Texas taxpayers
Where is the Cavalry?
Still no relief for Texas taxpayers
Three years ago when Gov. Rick Perry, Lt. Gov. David Dewhurst, former House Speaker Tom Craddick and various other elected officials smacked each other on the backs - because they believed the Texas State Legislature had provided Texans with "real" property relief - I wrote an article telling the truth about that tale.
Currently the truth, which is finally being realized by media editors and the public, is there is no real relief provided to overburdened Texas homeowners and there doesn't appear to be any in sight.
Foreclosures, currently at an all-time high, will continue to escalate if Legislators continue to refuse finding alternative tax resources to finance public education.
Overburdened homeowners still need tax relief. In addition, they continue to pay doubled home insurance premiums, which remain the highest in the nation.
First of all, in reality there was NOT a property tax cut in 2007 as the "top dogs" publicized. The legislature simply replaced one tax with another.
It's amazing, how these politicians make it sound like they have walked on water for the people of Texas.
Far from it!
It is high time Texans get rid of these useless, special-interest elected officials - like Perry, Dewhurst and Craddick - and replace them with more honest and (as of yet) unbought replacements.
Please consider the realities - or at least a different view - of what is happening here in Texas regarding property taxes.
THIS is why tax rebates are stupid
If Congressmen don't understand...
... is it little wonder that people don't understand. From Rep. Culberson's Twitter feed...
-- A surplus is a TAX SURPLUS and should be refunded to those who paid it
No, not really, Congressman. A tax is the price we pay to live in the greatest nation on Earth; Our contribution to maintaining the government that we all depend on. A surplus is what we'll be using to pay off the massive debt we accumulated while Culberson and his cronies were running things. Possibly, we'll be able to make some investments that will benefit the entire country. However, we gotta pay off our past excesses.
This is, sadly, all moot since we're far from running surpluses.
It would be nice to report Rep. Culberson was the only asshat in the bunch. Unfortunately, he's not... I give you Senator Liarson.
Uhm... Senator, if you're going to talk about tax policy and revenue it would be AWESOME if you knew something about it. What you and every other Republican doucher is referring to is the Laffer Curve and we're on the wrong side of it for tax cuts to equal revenue. Or, just go on and read this.
This is a time when there is a definitive right answer and a definitive wrong answer. And it appears that Republicans are going to continue to piss into the wind.
Senator Hutchison... you really need to rethink your desire to run for Governor next year. The someone like Sen. Van De Putte will beat your ass.
My new favorite ad...
February 26, 2009
This is why you don't cram down loans...
Hideo Shimomura, chief fund investor in Tokyo for Mitsubishi UFJ Asset Management Co., told Bloomberg Friday that “there is still a concern that there is no guarantee” of agency debt and securities, even after the Obama administration has said it will sink as much as $400 billion in increased funding to backstop the operations of the GSEs, as part of its Homeowner Affordability and Stability Plan, or HASP.
“Looking at the risk, [GSE bonds are] not so attractive,” he told the news service. “We need a guarantee before we’ll buy.”
Simplistically, this is all about whether or not the government will backstop Fannie and Freddie. But it's more complicated than that and it falls right down to whether or not we'll honor the money these people invested. Foreclosure is one thing; cramming down is a quite another.
Take Action to stop water pollution!
The Fed's are looking to rewrite drilling rules and exempt fracturing from the requirements. Fracturing, for those of you who don't know, is the process of injecting materials into a well to free oil and gas deposits. It also has a nasty side effect, when done poorly, of polluting groundwater.
Kelso nails Keller
Texas Leaders Send a Clear Signal
But will Texans get the message?
More than ever it is apparent that Gov. Rick Perry, Lt. Gov. David Dewhurst, Attorney General Greg Abbott and many legislators "don't give a hill of beans" about hardworking and hardly-working Texans.
For the past decade Texans have watched helplessly as their daily living costs have sky-rocketed to oblivion:
o Property taxes
o Home insurance
o Higher education tuition
o Loss of jobs
o Toll roads
o Fees and penalties
o Other goods and services.
Texas leadership has done little to lessen the financial burden on most residents. In fact, all too often they have been the cause of higher costs.
Now that the federal government has provided additional "stimulus" money to provide some relief for most Americans, Texas leaders are refusing to accept the money.
Our leaders have NOT been paying attention to the needs of most Texans. They say the first thing that is needed to get a stubborn mule moving is to get its attention by hitting it with a 2X4. Would it work on Texas leaders?
February 25, 2009
Leffingwell : Why I'm running...
This part of an excellent post by Lee Leffingwell over at BOR on why he's running for Mayor.
After many months of consideration, the reason that I finally decided to run is pretty simple. I’m running because I believe I know the direction Austin needs to go at this critical crossroads, and I feel confident that I can help lead us in that direction.
As of now, most of Austin hasn’t yet experienced the full impact of the national recession. But times are already very tough for lots of people in our community, and they seem likely to get worse before they get better.
For City Hall – just like for any struggling Austin family – that means having less money to spend, but just as many basic expenses to cover. And like any family, City Hall now faces some very hard choices – choices that could help determine if Austin moves steadily in the direction of a healthy recovery, or swiftly in the direction of a deepening recession.
I believe that right now we need a new leader in the mayor’s office who can and will stay focused on the fundamentals of our quality of life: jobs, traffic, public safety, social services, environmental protection, and effective, efficient basic services and infrastructure.
I also believe our next mayor must be committed to building renewed trust between City Hall and the citizens of Austin. Austin city government should be more inclusive, more transparent, and more accountable, and there is some real work to do in the years ahead to make it so.
I’ve said many times since announcing my candidacy for mayor last month that this race should be a contest of ideas for a city of ideas. That’s why I’ve laid out what I believe is the broadest and most specific platform of any candidate in the race to help us get through the tough times ahead and get back on track to a better future.
There's more here...
And he called him, and said unto him, How is it that I hear this of thee? give an account of thy stewardship; for thou mayest be no longer steward.
It appears that a semi-private charity that's supposed to give aid to active duty military personnel and veterans is really not giving much at all.
From 2003 to 2007 — while military families dealt with long deployments and more home foreclosures — Army Emergency Relief grew into a $345 million behemoth. During those years, the charity put $117 million into its reserves while spending only $64 million on direct aid, according to an AP analysis of its tax records.
Tax exempt and legally separate from the military, Army Emergency Relief projects a facade of independence but actually operates under close Army control. The AP investigation found that the massive nonprofit organization — funded predominantly by troops — allows superiors to squeeze soldiers for contributions; forces struggling soldiers to repay loans, sometimes delaying transfers and promotions; and has violated its own rules by rewarding donors with such things as free passes from physical training.
In case you were wondering, it's typical for a charity to to keep up to three years of spending in reserve to deal with tough economic conditions. The AER has 12. Not surprisingly, veteran's groups are very upset.
Now, while it's shameful that this fund is being so stingy, it's even more shameful that our soldiers and veterans are having to ask for help. Where are the laws requiring forbearance of debts? Where is the easy and fast financial aid to soldiers returning to civilian life?
Now that the Republicans are out of power, can we finally do something to help these folks other than giving them bad body armor?
Brilliant... Some GOP Govs are hella dumb
The best is Bobby Jindal. While in Congress, Bobby voted to cut taxes on the wealthy and increase federal debt on multiple occasions. For him to now talk about fiscal responsibility makes me realize what a douchebag he really is.
As for Mark Sanford... REALLY? Do I really need to say more about him? Oh, and would someone PLEASE tell Haley Barbour to quit eating the entire buffet?
Trade Surplus/Defict : The Animation
This a really cool graphical representation of US trade deficits and surpluses with some of our trading partners. And yeah, it'll surprise you.
Odor in the Court
Bob Woodward wrote in The Brethren that during Justice Douglas' last days on the Supreme Court, his incontinence bag used to stink up the chambers when they'd convene to debate cases... As if the aroma of Chief Justice Burger's legal arguments weren't stanky enough!
Friends, this sort of thing ought not occur; to say nothing of forcing the likes of Justice Stevens to hang on to his gig for, lo, these last eight years, while his contemporaries got to hold mid-afternoon court at Luby's, gorge on all the raspberry Jell-O they damn well please and watch the Wheel like normal dustcook- uh, i mean...Golden Agers. (Psst! It's OK to retire now, Justice Stevens - we won the last election! Quick, before another voter ID law comes up for review!)
That's why an organization affiliated with the "I've Been Thinkin'..." Coalition have come out with their own ideas for reforming the Supreme Court.
(For those of you unfamiliar with the "I've Been Thinkin'..." Coalition, it's a fairly new D.C. thinktank, chiefly established to counter the They Say Institute's intellectual hegemony inside the Beltway.)
Of course, I have a few ideas of my own on how to improve the court. Like not letting it decide presidential elections when there are more Republicans than Democrats on the Court. But since no one's publishing MY bright ideas on the subject, guess I'll just have to settle for weighing in on these proposals.
It seems to me that this idea for a senior justice status might solve a couple of problems. Number one, you address that whole problem of ancient justices being out of touch with society. Do you really wanna hash out a constitutional issue like gay marriage before judges who still think "gay" refers to how we'll all feel when Johnny comes marching home? Letting the 9 newest members of the Court decide these kinds of issues has some logic to it - and the senior justices can still weigh in with all their acquired wisdom and institutional memory...if indeed anyone with a vote happens to care what Statler or Waldorf might have to say on the subject.
Number two, (that's what Justice Douglas' nurse said!) you solve this problem of justices in ailing health clinging to their appointment if the job isn't worth as much in the fourth or fifth decade. That all but eliminates the need for this other weird idea to have justices "report" on each other when their health goes bad. And can't you just imagine how THAT idea would play out? First Scalia would rat on Ginsberg's osteoporosis, then Breyer would retaliate and out Thomas for having an enlarged prostate, back and forth, etc. etc. No thank you. Only people deranged enough to voluntarily read Woodward should be punished with that kind of information.
That said, the idea to have one court appointment per two-year congressional term is insanity. Really, one per presidential term is enough to strike a balance between the competing needs for continuity and new blood. Anything more frequent would be destabilizing and you'd wind up with something like what the Texas Supreme Court had a few years back. Those guys had such a turnover problem for awhile that it really created confusion. Sure, everyone still knew the outcome in any given case was probably "plaintiff loses," but nobody could keep track of exactly which 9 justices would get to say so.
The certiorari division idea strikes me as the idea most prone to the rule of unintended consequences. I'm not convinced the current system is broken on deciding whether to grant cert. And can you imagine the gamesmanship if opposite factions happened to control the Court and the cert. division? Trust me, granting cert is complicated enough without adding this new dimension. As Tracy Morgan in drag might say while impersonating Star Jones, "I know, because I'm a lawyer." And I read The Brethren.
You know you've fucked up...
...when even Pat Robertson and Jeb Bush call you out.
February 24, 2009
Release The McCracken loses endorsement
In a sad turn of events for RTM, Rep. Eddie Rodriguez has endorsed Lee Leffingwell...
We’re very proud to announce that State Representative Eddie Rodriguez has endorsed Lee Leffingwell for Austin mayor. Eddie represents District 51 in the Texas House of Representatives, which encompasses most of East Austin, just south of MLK Boulevard.
This presents a MARVELOUS opportunity to release this, our new picture of Brewster...
You can totally tell this was done my someone other than me due to the fact that it betrays talent. And skill.
In other news, RTM hosted some kind of a creative convergence thing. It's all about 'creatives', which is pretty much limited to people who call themselves creative because they are working on an 'awesome project that just needs a producer to believe in it'. Or at least that's what they say when they're tying up valuable outside tables at Red House while sipping on a beer FOR TWO HOURS, doodling on a blank page and chatting with a friend as an Umberto Eco book sits on the table, unopened. They also work in film, music, panhandling, selling shit on the Drag and food service.
The event was held at Momo's. No information was available at post time regarding what was done with the 40-something single women that usually fill up Momo's while waiting for a drunk fratboy from J. Black's to accidentally stumble in because he thought it was The Ranch.
I really tried to cover everyone with this post. If there was anyone I failed to offend, accept my apologies and please, keep coming back! We're sure to say something that will anger you in time!
I give you, Celebrity Autobiography
See more here...
Then there's nationalization and information flow
The threat of nationalization is what's weighing on the market. What's making me continue to buy? This
"We witnessed the collapse of the financial system," Soros said at a Columbia University dinner. "It was placed on life support, and it's still on life support. There's no sign that we are anywhere near a bottom."
His comments echoed those made earlier at the same conference by Paul Volcker, a former Federal Reserve chairman who is now a top adviser to President Barack Obama.
Volcker said industrial production around the world was declining even more rapidly than in the United States, which is itself under severe strain.
"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," Volcker said.
I'm kinda surprised Volcker and Soros, two very brilliant minds, don't see what's happening. It's information flow. We don't live in a world where news takes weeks to travel. We live in a world where one bit of data can drive down the US markets in 10 minutes and all the other dominoes fall as well. And the one thing no one is talking about is that, in this type of environment, what drives you down can just as quickly drive you higher.
What's funny to me are the folks out there who think this is the end of capitalism. It's not. It's the end of this particular experiment with laissez faire. Relatively soon people are going to get that. Until then, I'm happy to buy the securities you're dumb enough to sell at a loss.
Today, Bloomberg had a chart up of the Dow showing volume. It's increasing as the market goes down.
February 23, 2009
Harris County is dirty...
This is a Google Earth overlay showing the carbon output of counties in the US. The project, produced by scientists at Purdue, is really very illuminating.
Don't go away mad, Judge Keller. Just go away.
This is good news and I'm thrilled that there is the potential, no matter how slim, that Judge Keller will be removed from the bench.
February 21, 2009
BREAKING : Please let it be Dick Morris
DC Police say they are close to making an arrest for the murder of Chandra Levy in 2001.
February 20, 2009
Apparently, the Catholic Church's absolute stand against abortion is a relatively (for the Catholic Church) new thing.
I know, I'm not supposed to laugh but it's sooo damn hard not to.
Stupid, Mr. President. Very stupid.
So, the housing plan is out. Cramdowns, mod's and all the other good times. Reich thinks the mod law and bankruptcy cramdowns will give the servicers leverage with the MBS holders. Yeah. Sure. Since they're under a legal obligation to listen to the servicers and all. Unless this law rewrites FAS 140 and overcomes ruining the Q, they're going to sue. And this may all end with 30 year mortgage rates in the teens.
Sure, I could be wrong. I certainly was about my bet with John Sharp. Of course, my side of that bet was predicated on smart people doing smart things. So far, that hasn't happened.
My big problem with the housing plan is that the damn thing rewards bad behavior and allows many people to profit from their bad behavior, while asking the investor to take it on the chin.
Let me tell you a little story... my family owns rental property. My grandmother depended on that income from those properties. When someone didn't pay, she felt bad but that was HER INCOME. Further, these folks signed a contract to pay a certain amount every month. She wasn't a monster, she'd work something out with them if possible, but she didn't write down what was owed. The payment was the payment. Millions of retiree's depend on income from MBS and you're, in effect, telling them to stock up on tender vittles.
This is the equivalent of letting everyone underwater on a car get the balance written down. I have no problem with the government subsidizing an interest rate for a borrower either directly as part of a refinance or through the purchase of MBS in the open market to a point where they can afford to pay. I do have a problem with a principle cramdown. When you buy a house, the people who lent you the money didn't write into the loan that they wanted to share in appreciation when you sell the house for more than you paid. Why the hell should they now share in your loss because the house isn't worth as much as you paid?
I am acutely aware of the crisis. I know people need help. I also know that the quickest way to get us on the path to recovery is to end the decline in housing and we can't do that until we arrest foreclosure rates. Unfortunately, this plan will end up causing more pain for far longer in an effort to help even those who really don't deserve it and couldn't afford their homes even at a 1% interest rate.
February 19, 2009
You may remember that I, along with a bunch of other bloggers who clean up real purty, recently had dinner with John Sharp. At that dinner, I bet him $50 that the Dow would not break it's November low on the close.
Which it, of course, did today thanks to the marvelous work being done by the Obama Administration in general and, in particular, the doucheriffic performance of Tim Geithner. Please allow me to eat crow on the bet and Timmy-boy.
Note that I'm not taking it on the chin about Obama's fuckups. Putting the Democratic JV team in the White House was all you other people. I voted for the varsity in the primary.
Oh, and if you're a Republican... MCCAIN WOULD HAVE STILL FUCKED THINGS UP EVEN WORSE, SO SHUT THE HELL UP.
News from Japan
If you can explain to me what a Japanese guy in blackface doing magic tricks has to do with President Obama, then you're probably a dittohead.
"We honestly had no idea people did not enjoy this stuff," said Cultural Affairs Minister Kazuhiro Nakai, expressing regret for the thousands of hours of bondage porn, rape porn, utensil-rape porn, food-rape porn, frozen-food-rape porn, vomit-enema porn, elder-care-coma-patient-rape porn, and the kind of a porn in which a nubile youth is kidnapped, stripped, tied down in a wading pool and raped. "We are deeply ashamed for whatever it is about these films that has made people around the world vomit so vigorously. Please know that the content was only intended to entertain and arouse."
You SUCK : George Will Edition
George Will says some stupid things and rarely knows what he's talking (or writing) about. He's been doing it literally for years, but we'll get to that later.
Recently, he penned a piece in the WaPo that got picked up by the Statesman about how global warming is a bunch of BS based on some really awesome anecdotal evidence that in some cases, when you dig a little deeper, is taken out of context and actually supports global warming.
I especially love the Julian Simon story in Will's piece, mostly because I love Simon. However, as usual, Will completely misses the point of Simon's work and the bet. The bet was more broadly about mankind's ability to fix problems and grow around constraints. In a similar vein, I'll make George a little bet... in 10 years, the environment will be cleaner than it is now and we will probably have found a way to reduce the carbon load in the atmosphere. This won't be because global warming isn't a very real problem... it'll be because we have the capacity to fix the damage we've done. If only we'll ignore the idiots like Will who are tragically incapable of realizing the frailty of the environment.
Oh, and as for getting things wrong, there's this...Jonathan Schwarz has this awesome story about Will from Noam Chomsky. The persistent lying and lack of accountability may sound familiar to you.
CHOMSKY: [A] few years ago George Will wrote a column in Newsweek called "Mideast Truth and Falsehood," about how peace activists are lying about the Middle East, everything they say is a lie. And in the article, there was one statement that had a vague relation to fact: he said that Sadat had refused to deal with Israel until 1977. So I wrote them a letter, the kind of letter you write to Newsweek—you know, four lines—in which I said, "Will has one statement of fact, it's false; Sadat made a peace offer in 1971, and Israel and the United States turned it down." Well, a couple days later I got a call from a research editor who checks facts for the Newsweek "Letters" column. She said: "We're kind of interested in your letter, where did you get those facts?" So I told her, "Well, they're published in Newsweek, on February 8, 1971"—which is true, because it was a big proposal, it just happened to go down the memory hole in the United States because it was the wrong story. So she looked it up and called me back, and said, "Yeah, you're right, we found it there; okay, we'll run your letter." An hour later she called again and said, "Gee, I'm sorry, but we can't run the letter." I said, "What's the problem?" She said, "Well, the editor mentioned it to Will and he's having a tantrum; they decided they can't run it." Well, okay.
Rep. Cantor and feathering your own nest
Hypocrisy is a motherfucking pain. As it turns out, Rep. Eric Cantor's vote for TARP has ended up supporting the very bank his wife works for. I say work, but the reality is no one is really sure what she doesDiana Cantor runs the Virginia branch of Emigrant's wealth-management division, called Virginia Private Bank & Trust, which targets an ultra-rich clientele. ... The Virginia Private Bank & Trust, a satellite opened this spring, is still getting off the ground. On Thursday, when ProPublica visited its small Richmond office in an office park not far from the Cantors' home, a sheet of white paper taped to the door served as its sign. One of the two employees there said the office had yet to serve a client since it opened last spring. She referred further queries to the bank's main office.
Of course, after his wife's bank got their bailout, Cantor voted against TARP 2. And the Stimulus package for the rest of the county. It's good to know that his integrity is literally as deep as a shallow puddle.
February 18, 2009
After busing began to desegregate public schools, the middle class left cities for the suburbs. Now it looks like the cities are forcing out the rest of the middle class that moved back or remained and replacing them... with the rich. The trend is most pronounced in NYC.
Rep. Eric Cantor, taking credit for things he didn't do
NSFW...This is a spoof of a commercial credit by AFSCME which represented state, county and muni employees across the country.
AFSCME and other unions have targeted GOP leadership (including Rep. Eric Cantor). Cantor's office sent this ad out in reponse saying it was 'a joke'. Now, the ad is funny as hell and, while base (you know we love the crude), it's actually pretty good at telling what the union membership actually does.
It also wasn't made by Cantor or anyone in his office, but they're sure as hell taking credit for the funny. The union leadership is, of course, pissed as hell. Which I really don't get, but if they're mad at Cantor then I'm all for it since I don't think there is too much ridicule and shame for those narrow shoulders.
Plus, I think it's lame as hell taking credit for funny you didn't actually make.
Nationalization and Sen. Graham
Sen. Graham thinks that nationalizing the banks shouldn't be taken off the table. Of course, some of his fellow Republicans think he's crazy...“That's going above and beyond being a maverick,” said Glenn McCall, York County GOP chairman and a Bank of America executive. “That's saying that socialism in our country would work better than letting folks use their God-given talent to create and foster economic growth.”
Rep. Sue Myrick of Charlotte called nationalization “absolutely a no-no.”
“I can't even believe that Lindsey would say that,” she said. “I mean the government running the banks? Talk about a disaster.”
Bank of America Chairman Ken Lewis last week called the notion of nationalization “absurd.”
“I've never had anybody even hint at it,” he told CNBC.
It's the comment from Rep. Myrick that really made me laugh since the banks have done such a bangup job of running things on their own. That aside, this is not such a good idea. On the surface, I'll concede the market cap point to Graham...Graham said the government has already poured billions into banks with little to show for the economy. Bank of America, which has received $45 billion in bailout money, is currently worth $27 billion in market capitalization.
“The truth is we've put more money into the Bank of America than it's worth,” Graham said. “That's not nationalization. That's just stupid.”
Well, maybe... maybe not. See, if you BUY BofA, you get the whole thing. And you get to fix it. What the government is doing now is buying preferred shares and loaning them money, basically parking some bad assets until the securitization market (which, just FYI, is way bigger than the banks) recovers. Then we get our money back. If we nationalize, we get the whole thing, write downs and all, uncertain management and when we go to spin all this back to the public, who's going to want to buy it now that they know nationalization isn't out of the realm of possibility? Not and FDIC takeover but a real banana republic style nationalization?
If you want to get pissed about something, get pissed about this. And get even more upset about Treasury's spin on it...The Treasury Department said lending likely would have fallen further without the roughly $200 billion that has been provided to banks so far, given the sharp downturn in the economy.
"Loan activity was resilient in the face of the worst economic downturn in decades," the department said.
Uhm. That's the banks lending their own money. That's been largely fixed. What hasn't is securitization, the shadow banking system. They don't need cash and there is now way to nationalize them because they aren't broke. The only thing you can do is print money and put it to work. Eventually, when the shadows realize that by sitting on the sidelines they are losing money to inflation, they'll get back in. Of course, we'll all get to suffer from inflation which is neat.
OR, we could start refinancing these assets and get the system working again.
Until we fill the almost $10 trillion hole in the economy, it's going to get worse.
February 17, 2009
Eggs are still affordable
Today, I, a novice, went to the Texas State Capitol on business. When I arrived home and read this editorial, the light went on.
I’ll leave the fight songs for later
When the going gets tough, some go cycling on the 360.
Housing : A bunch of damn idiots
Here's an infuriating little article over at Business Week talking about mortgage mod's (the few that have been done) and the poor homeowners.
Let me just say, my sympathy is wearing a little goddamn thin. For everyone from the stupid homebuyers, to the retarded reporters trying to get a handle on this, to the corrupt politicos all the way up to the morons at far loftier levels than the one I occupy in the banking industry who were too stupid to realize that they'd built their houses on foundations of sand.
First off, giving BK courts cramdown authority IS going to have a negative impact on the pricing of loans in the US. Pure and simple. Think about it this way... I'm an investor in US denominated debt securities, usually MBS. Suddenly, some of the mortgages that make up the securities I've paid 102 for are being reduced by judicial fiat to 60, which drops the overall value of my securities to 90. Do you REALLY think I'm going to buy more of this crap that just gets arbitrarily written down? Hell no... I'll go invest in fixed income securities in the EU or Asia where the rule of law and the sanctity of contract still means something. Which means MY money is no longer helping to prop up the US economy. And suddenly, there's a flood of dollars, inflation goes through the roof and interest rates start going up and up. But McBlogger, we can just borrow the money from banks? Sure. At far higher interest rates. What no one out there really gets is that securitization save consumers money by making loans cheaper. Fuck that up and we're back to 20% down, 60 days to close and high interest rates.
The most irritating thing about cramdowns is that they aren't needed though lots of stupid people will tell you differently. Take the folks from the BW article...vConsider the case of Ocbaselassie Kelete, a 41-year-old immigrant from Eritrea who called Hope Now last fall. Kelete, a naturalized U.S. citizen, bought a $540,000 townhouse in Hayward, Calif., in November 2006 with no down payment and 100% financing from First Franklin Financial, a subprime unit of Merrill Lynch. At the time, he and his wife earned $108,000 a year from his two jobs, with a pharmacy and an office-cleaning service, and hers as a janitor. Kelete says First Franklin and his realtor convinced him that he could afford a pair of mortgages, one with a 7.5% initial rate that would rise after three years, and a second with a fixed 12% rate. His monthly payment would total $3,600.
Now we don't know what he's currently making... however, based off his old total income, 40% of his gross earnings were going into the damn house. 40%! Now, I've seen people spend like that and be fine... so, why not this guy? This asshole's goddamn mortgage hasn't even reset and he's whining? AND I'M SUPPOSED TO FEEL BAD FOR HIM??!?!?!!? No, ma'am. What this guy needs is a lesson in managing his finances. Fortunately for him and the millions like him, we don't have that kind of time. So, what to do?
Easy... refinance him using FHA. Limit to no more than $1mn per loan nationally, no appraisal and you can't exceed more than 106% of the original loan balance which will allow them to put in costs, arreage and past due taxes. Pass a law that breaks the prepayment penalty on the loans but allows the servicer to charge the loss against future earnings (since they'll be on the hook for it to the end investor). The loan pays off at par, the investor takes a minor hit, the servicer takes a hit and the homeowner gets a mortgage they can afford but at the full amount they agreed to pay. The government, for it's part, insures the loan against default, takes a nice premium for doing it and the market stabilizes because the new securities have a government backing.
With this in place, you will rapidly see bank balance sheets restored because the securities they are holding will be steadily bought out under the new program when the existing loans are refinanced. Honestly, this is the easiest way to do it and most effective because it helps everyone. The best part is that the government can effectively borrow money at 3%, then loan it back out at 5%. You could use the differential to strengthen entitlements and give a huge boost to upgrading infrastructure. The only problem is that the Centrists in Congress would never let it pass because they are too stupid to understand the complexities of the situation we're in.
Second, on the issue of modification, go read this. More specifically, the section on modifying the mortgages that make up the securities. Needless to say, it's pretty much impossible.
There is another option... the government could buy up the MBS, break it apart and mod the underlying loans or mitigate the losses on the homes that are foreclosed. That would end up leaving tax payers on the hook for around $3 trillion. This is probably what will end up happening if the government proceeds with the public-private plan, or worse, nationalization. PPP requires the government have partners with money. There are plenty of vultures out there right now, but few are willing to pay what the banks think the paper is worth. Pimco has been willing to buy MBS at 60 cents on the dollar, but that would mean the banks lose the upside... and it would neatly put a giant hole in their balance sheets. Best case, the government could make an equity investment in the banks, restoring balance sheets and wiping out the existing shareholders. Then they have to clean up management and reprivatize the banks. All this will do is make a lot of already rich people very rich. It may sound good, but in the end this doesn't do a damn thing to fix the loans.
They've got to be modified via refinance. Congress has to free HUD to do it. The only way that will happen is if the President and the Democrats brow beat the Republicans. Of course, they also have to realize it's the right thing to do.
Finally, the idea this is going to go away or that we can end this crisis without dealing with the underlying problems is ridiculous. Putting people into emergency loans is one thing but we have to fix regulatory enforcement. Then we have to fix the accounting regs that forced mark to market accounting when the market was broken. I wrote about this more than a year ago. I also wrote this. Go read it then come back and reread the section on this public-private bullshit.
While it's viscerally satisfying to nationalize and wipe the banks clean, it also leaves tax payers on the hook.
Oh and let's actually fix this and THEN move on to Social Security, Mr. President.
February 16, 2009
Munger SpeaksOur situation is dire. Moderate booms and busts are inevitable in free-market capitalism. But a boom-bust cycle as gross as the one that caused our present misery is dangerous, and recurrences should be prevented. The country is understandably depressed -- mired in issues involving fiscal stimulus, which is needed, and improvements in bank strength. A key question: Should we opt for even more pain now to gain a better future? For instance, should we create new controls to stamp out much sin and folly and thus dampen future booms? The answer is yes.
Sensible reform cannot avoid causing significant pain, which is worth enduring to gain extra safety and more exemplary conduct. And only when there is strong public revulsion, such as exists today, can legislators minimize the influence of powerful special interests enough to bring about needed revisions in law.
My FAVORITE part, especially since it comes from a Republican...Moreover, rationality in the current situation requires even more stretch in economic thinking. Public deliberations should include not only private morality and accounting issues but also issues of public morality, particularly with regard to taxation. The United States has long run large, concurrent trade and fiscal deficits while, to its own great advantage, issuing the main reserve currency of a deeply troubled and deeply interdependent world. That world now faces new risks from an expanding group of nations possessing nuclear weapons. And so the United States may now have a duty similar to the one that, in the danger that followed World War II, caused the Marshall Plan to be approved in a bipartisan consensus and rebuild a devastated Europe.
The consensus was grounded in Secretary of State George Marshall's concept of moral duty, supplemented by prudential considerations. The modern form of this duty would demand at least some increase in conventional taxes or the imposition of some new consumption taxes. In so doing, the needed and cheering economic message, "We will do what it takes," would get a corollary: "and without unacceptably devaluing our money." Surely the more complex message is more responsible, considering that, first, our practices of running twin deficits depend on drawing from reserves of trust that are not infinite and, second, the message of the corollary would not be widely believed unless it was accompanied by some new taxes.
Moreover, increasing taxes in some instances might easily gain bipartisan approval. Surely both political parties can now join in taxing the "carry" part of the compensation of hedge fund managers as if it was more constructively earned in, say, cab driving.
The entire piece is well reasoned and well written which makes is very surprising that I would find it so compelling. Of course, I'm also really good at listening to people far more intelligent, educated and successful than myself.
February 15, 2009
This looks like fun...
February 14, 2009
Tom Schieffer wants to run?
I think this might be a good thing, connections to Bush aside. I also wish someone would explain to me why being a pro-business Democrat is bad. Why is that the standard issue press comment when talking about a successful person considering a run as a Democrat?
February 13, 2009
Junio John Speaks
The stimulus bill is not going to work, mostly because of the tax cuts/rebates, which Junior John now says don't work. Which is kinda funny since part of the reason he's voting against it is because it's not 100% tax cuts.
He also conveniently ignores the fact that the overweight toward tax cuts in the bill are the result of compromises to Republicans. Then he mentions a CBO study that says this bill will eventually crowd out private investment. Which is hilarious since this bill isn't even a tenth of the size of the US economy.
Finally, Sen. Cornyn flat out lies about the efficacy of tax cuts vs. spending saying that spending is about half as effective.
It's never been more clear than now that we need a real Democrat in the Senate representing Texas. I don't know that either Sharp or White are that guy. I have no idea what they think about fiscal stimulus in a deflationary environment. I can tell you this, listening to Cornyn makes it clear that we can not afford to elect another ideologue more committed to politics than actually governing.
Which means, Sharp and White camps, you better get some goddamn good people to tell you what to say or I'm going to rain shit all over you both.
Sen. Corynyn on Bloomberg
Speaking for Texans, we'd like to apologize for not getting rid of this cocksucker last year. Please just ignore him and realize that we find him terribly embarrassing.
There's dumb and then there's the AEI
The AEI has a critique up regarding the report from the G30 on financial services regulation. Here's a brief excerptA good summary is that bank-like regulation would be spread beyond the banking industry. But there’s a problem: banks have been tightly regulated for years, both in the United States and Europe, and of all the institutions hurt by the financial crisis, they are in the most trouble.
It gets worse from there. I suppose it's worthless to mention to the author that much of this regulation was unenforced (which the report didn't fully address, but that's another problem) and that the current crisis is almost entirely attributable to the push for (and subsequent) deregulation of financial services. That's what allowed firms like Bear Stearns to lever up 30 to 1. That's what allowed Citi, one of the largest depository institutions in the country, to dump hundreds of billions into SIV's and leave themselves, ultimately, on the hook for those SIVs, not to mention the leverage in them.
And the solution is less regulation? According the author who then goes on in his little critique to indicate that the report's recommendations were written entirely without analysis and the validity of them rests only on the credentials of the authors.
Let's see... while the critique author was a special counsel to President Reagan, one of the guys who wrote the damn report was the chairman of a little organization called the Federal Reserve. He also happened to the guy who actually broke the stagflation of the 1970's. Credibility aside, there's also the issue of solvency (which the banks, thanks again to deregulation, would lack were it not for TARP) not to mention the crisis of confidence thanks to people like Madoff(who, it should be noted, wasn't regulated) and the collapse of many of the IB's on Wall Street. It's amazing to me that these morons really don't understand that part of what makes America work is the confidence people have in banks due to... wait for it... REGULATION.
Peter Wallison and the other pathetic losers at the AEI would do better to keep their mouths shut given that they're all political hacks with little talent and even less skill. Better to be thought an idiot, don't you know...
The Stimulus Plan as a picture
And there it is, the inadequate fiscal stimulus, the best that could be obtained from the ridiculous centrists who predicated their support for the plan not on economic reality but on their own ideologies and political strategies. Which, thanks to their hard work, won't help as much as the plan the House passed. No, the centrist supported plan will create several hundred thousand fewer jobs.
We knew all this a while back, but they still carried forward with stupid tax cuts. Sen. Cornyn even sent out a whiny email LYING about how many jobs the Republican plan would have created and about the ultimate cost of stimulus. Junior John, far smarter and better educated people than yourself have conclusively shown that you are, in fact, lying. As if that wasn't enough, we also have empirical evidence from our last tax cut rounds that they don't grow the economy.
Meanwhile, the bad economy finally starts to hit Texans. And Governor Perry, it should be noted, has publicly stated that just might return stimulus money. And our two Senators voted against it. Makes you long for the days when Republicans worked with Democrats for the good of the country instead of playing politics with people's jobs and the greater economy.
see more pwn and owned pictures
February 12, 2009
Rep. Pete Olson, Chickenshit
Really, Pete Olson? REALLY?
I'M A TEXAN. For damn near a decade I've watched our leaders in Washington, some of them from Texas, act like chickenshits about terrorists. Most Americans I know aren't scared of terrorists. Every Texan I know would grab a gun and fight before running and hiding. In fact, they'd be more concerned with how to lynch these 'terrorists' if they end up in a Texas prison than they would about other terrorists attacking.
Pete, you're a Grade-A coward. Quit whining, titbaby and man up.
"I know I'm not Mickey Rourke"
No, kids, this is not safe for work...
Spot on, Robert Reich
Playing politics with economic stimulus is like arguing over what started the fire while the house is burning.Yet at this very moment, Senate Republicans are seeking to strip the President's stimulus package of many of its spending provisions and substitute tax cuts. Part of this is pure pander: They know tax cuts are more popular with the public than government spending, even though spending is a far more effective way to stimulate the economy (more on this in a moment). Another part is pure partisan politics: Republicans are emboldened by Obama's willingness to court Republicans (taking three Republicans into his cabinet, bringing Republican leaders into the White House for consultations, putting all those business tax cuts into the stimulus bill in order to gain Republican favor) without getting anything at all back from the GOP. House Republicans snubbed the bill entirely. So, Senate Republicans say to themselves, what's to lose?
Plenty. Millions more jobs and a full-fledged Depression, for example.
February 11, 2009
Two takes on Geithner's TARP, Part 2
Of course, additional details are going to come out related to mechanisms for price discovery (using discounted cashflows, probably) for illiquid assets and the stress test designed for the banks. It's the latter that's going to be most interesting to me (the increase in the Fed's balance sheet was going to happen regardless... and, frankly, should be happening in this environment. That's WHY we have the Fed) especially because, at it's core, it's going to depend on asset valuations which leads us straight back into (oh, you had to see it coming) price discovery.
You could also call it short circuiting FASB.
Roundin' Up The TPA
It's time for another edition of the Texas Progressive Alliance's weekly round-up. Enjoy this week's look at the best of the TPA.
And speaking of Oil and Gas, WhosPlayin analyzed a contract his city of Lewisville made, leasing its mineral rights cheap to purposely bring in oil and gas development to the suburban Texas city of 92,000.
The Texas Cloverleaf brings you the Trinity Toll Road Boondoggle, soon to be funded by your tax dollars.
Neil at Texas Liberal writes about President Obama's policies for rural America. Our cities and rural areas have more in common than we realize. It would be good if urban and rural office holders in the Texas Legislature would think about and talk about how they could help each other.
Over at Texas Kaos, lightseeker asks How Long Will We Have to Put Up With these Arrogant Tools? What has set him off is deposed Czar Craddick's last corrupt act - destroying potential evidence of big a tool he is and was.
Vince at Capitol Annex takes a look at the fact that State Rep. Sid Miller (R-Stepehenville) is spending campaign cash to buy stocks in companies like AIG, Halliburton, and more.
A duo for Dunbar
Kuff and BOR have posts up about the fight for the seat on the SBOE now occupied by the odious Cynthia Dunbar (named by her HS graduating class as Most Likely To Go Full-Tilt Nutter... Who said HS superlatives were not accurate predictors of the future?!?).
Both announced candidates are insanely overqualified for SBOE by virtue of the fact that they aren't crazy. So, the choice boils down to, who is most likely to take this to Cynthia and really go for the jugular? Who is going to actually fight this to win, not as some sort of grand debate?
My money is on Shelton... well, it will be as soon as she can start raising money.
The Economy : Stimulus, Deflation and more
From RitholtzBack to the planned US rescue packages, and specifically Bill King’s comments: “The main problem plaguing the US economy is too much debt has been accumulated on gratuitous spending and the papering over of declining US living standards. Solons espouse a monstrous surge in debt to fund even more consumer spending. The toxin is not the cure. Inducements to save and invest in production are the remedy. But the welfare state and its ruling class are trying a last grandiose socialist [Keynesian] binge in the hope of salvaging their realm.”
OK, this guy's over the edge of the cliff with the Keynesian=socialist bullshit. That's not why I put up the quote, though it is fun to poke at the deranged thinking coming out of economists on the right. No, I posted it because he's got something down perfectly... the decline in living standards. What he means to say is the decline in real wages but he'd sound like a real economist then and the nutters would pull his membership card and parking privileges. Part of the reason we've been burying ourselves in debt is that it was the only way we could afford the standard of living to which we'd become accustomed. The trigger that collapsed the credit markets (built on the house of cards that was the CDS 'market' and levered banking) was higher than usual defaults on home loans which were caused by two factors... higher energy prices and interest rate resets on some sub-prime ARMs. When wages aren't increasing but the cost of living is, there is always going to be a breaking point.
The solution? That's going to take some people smarter than me. I think it's a fundamental shift in tax policies that have favored short over long term gains that will do the majority of the heavy lifting. It's also paying more for the lowest levels of jobs. Just like many Americans have enjoyed cheap crap from China, they've also enjoyed paying lower than reasonable prices for real work. That's gotta change because you can't have a stable long term economy that sees people at the top making an unbelievable amount of money while a vast number at the bottom make less in a year than those people make in a day.
And, just for fun, we're already in deflation and the only thing holding us up is the Fed and Treasury.
All this is as a backdrop to this post over at Greg's Opinion that's spot on. Especially the takedown of new RNC Chair Steele who apparently hasn't seen that more than half the jobs Bush 'created' have disappeared.
There is something else worth noting regarding the comparisons between now and the Depression, especially the notion that government spending didn't do the trick. Those on the right with just enough knowledge to be dangerous are fond of pointing out that in 1940 unemployment was still high. What they don't tell you was that in 38 and 39 the government tried to balance the books by slashing spending and increasing taxes. Which sent the economy back down again. In other words, there wasn't enough stimulus. Click here if you don't believe me.
It should also be noted that even that high level of unemployment in 1940 was still about far better than the absolute worst level in the Depression (about 25% vs 16%) which also kinda deflates the ramblings of the new economic theorists on the right who are just now discovering fiscal responsibility. The problem with them, as usual, is that their timing is awful. Simply put, the government has access to money that is functionally free and the economy needs that money since it's not going into the private market.
Think about it this way... it's analogous to worrying about what started the fire and how much it'll cost to put it out when the house is burning. And you're sitting in the living room.
February 10, 2009
Note to Rep. Neugebauer
Dear Rep. Randy... you really shouldn't talk about the economy. Or how to pull us out of recession. Or how to keep us out of a depression. Or adding federal debt (which, by the way, there is a tremendous demand for) to finance stimulus.
Randy, buddy, I gotta tell you your ignorance of basic finance and market dynamics is pretty scary. You know the old saying about keeping ones mouth shut?
Quit using talking points and playing politics. There is more at stake here than playing asshole in a stupid attempt to rebuild your moribund party.
Hate you lots,
In 1999, Texas deregulated the retail electricity market. Austin kept it's municipal power company and remained regulated. Since 1999, rates have increased by 25% in Austin. In the deregulated parts of Texas, rates have gone up 64%. The industry wants to blame it on increases in natural gas prices but other states that are dependent on natural gas saw far lower increases in prices.
The best part of the Statesman piece was this from Senator turned industry lobbyist David Sibley...The Legislature passed a sweeping deregulation law in 1999 that sought to break down electric company monopolies and remove strict government control over retail electricity rates. The idea was to allow competitive market forces to drive down prices. The sponsor of the legislation, former Sen. David Sibley, acknowledges that rates have gone up but said he still considers the law a success.
Sibley, who now lobbies for power companies and others, blames the hikes on increased natural gas prices. He said Texas is far too dependent on natural gas and would see lower rates if it diversified to coal, nuclear and other energy sources.
"The fuel mix is a problem," Sibley said. "We're building nothing but natural gas plants."
But the report found that even when compared with neighboring states that are also heavily dependent on natural gas, Texas has higher rates. Oklahoma and Louisiana, for example, are big users of natural gas but did not deregulate their markets as Texas did, the data show.
So, David, you told us that deregulation would save us money. Now, while working as an industry lobbyist, you want us to believe another of your lies? Sure thing. But first, would you mind setting your hair on fire?
Texans will see lower electricity rates when we reregulate the market. Let's be honest, markets work best when someone is looking over industry's shoulder.
February 09, 2009
This is what will happen to the US if we don't take solid steps now to end income stratification and turn tax policy to investments and building jobs, not taking profits.
Carly Fiorina on compensation caps
I've got a suggestion, Carly, that makes sense. How about no executive may make a salary that exceeds 20 times the pay of the lowest paid worker? That's, what, $200k for someone at Wal Mart? Sounds about right.
Yeah, I'd be THRILLED with that and I think it's appropriate. As for stock grants/options, they should be expensed as a cash charge and they should be distributed evenly to all employees. And no long term contracts.
The age of the celebrity CEO and their cronies on the board is OVER. They're losers and it's time they got cut off. If Buffett can find talented people to run his companies and not pay them outrageous salaries larded with stock options while performing exceptionally, then surely every other company can as well.
Especially since many celebrity CEOs (like Carly) are only good at losing shareholder's money.
February 07, 2009
Give Gov. Perry credit for high tuition costs
Texas children and their parents can thank special interest driven Gov. Rick Perry for unaffordable tuition costs.
In his reelection bid , Perry is proclaiming himself to be the hero who will reduce tuition costs. Unfortunately, the reality is that Gov. Perry is a major cause of increased tuition.
Is college for wealthy elitists only? The answer is, "Yes."
Three years ago Gov. Rick Perry and various legislators lobbied for their higher education special interests and approved the bill to deregulate tuition costs under the guise of creating free competition, which would result in lower costs.
Since that time the University of Texas raised its tuition costs at least 4 times and other universities and colleges followed suit. Today, fewer Texas families can afford to send their children to college for a higher education degree, which once again ensure that degrees will be held by the children of wealthy families.
All children have the right to complete a higher-level education and become productive citizens despite the opposing efforts of Gov. Rick Perry, special interests and wealthy lobbyists.
Thank Gov. Perry by NOT reelecting him in the November 2010 election!
February 06, 2009
Transportation : Cintra In Tarrant Co; High speed rail?
Todd over at BOR has some new information up about the North Tarrant Express toll/free-way contract that was recently awarded to everyone's favorite infrastructure operator, Cintra of Spain. Originally the project was sold as adding new frontage roads, freeway capacity as well as managed lanes. However, it turns out that the managed lanes will be build first and the rest is, well, TBA which makes this less a combination project and more of a full on tollway. Yet again, the idea of high speed rail enters the minds of legislators Wanna know why things are so bad on our roads? It's simple... a lack of investment. Americans have been on an anti-tax consumption binge for 30 years and now we're paying the price by having to sit traffic for hours on end.
RPT: "We're fucking the stimulus plan!"
Seemingly proud of the Republicans in Congress from Texas who decided to vote against the stimulus package, the RPT sent out this nice little emailJust last night, President Barack Obama put on the full-court press for the Democrat stimulus package. In his interviews with each major network anchor, he called on Senators to support this almost $1 trillion plan. Then his political committee sent an email to their list of over 13 million emails a few hours ago.
You can see what tremendous pressure is being exerted as the Senate faces a showdown vote any day now. That's why it's so important for our Republican Senators to stand strong in opposition to this gigantic bailout full or pork-barrel projects and earmarks.
Every single GOP congressman voted against the package last week, and our two Texas Senators are speaking out against it right now!
Your support is needed to help these courageous Republicans stand against the onslaught of attacks coming their way.
The onslaught of attacks? You mean the onslaught of well deserved attacks, don't you? As for the pork and earmarks, roads in cities and counties all over Texas are PORK?!?!?! Not so much because, and this will come as a shock, GOVERNMENT SPENDING IS STIMULUS. Every time the government spends money to buy something, someone has to make it, sell it and ship it. Those people will have jobs and money to then spend to churn back into the economy and pay their mortgages.
The tax cuts ARE pork since they won't achieve the goal, but hey, that's what Democrats are having to give up to get some of you assholes on board. I don't think they should but it seems pretty clear they're as spineless as you Republicans are stupid.
As for the full-court press, I must have missed that. I only caught how Republicans were holding things up.
TARPing me to death...
Elizabeth Warren is one of the few lawyers (Harry's the other) I actually trust. Her work on the abuses of credit card companies has been essential to shed light on and stop their most egregious packages. Her committee's report on TARP is out and the result is that that US got back $66 for every $100 it invested in these entities. Which conflicts with other reports.
Oh, and it makes me mad as hell.
Now, these aren't actual loses and the government is already receiving dividend payments. So the question becomes, why is the discount so high for the government? There is a simple explanation that the media are mostly ignoring, mainly that yelling fire in a crowded theater is dangerous. This money had to go to weak players and strong players on roughly equal terms. If that hadn't happened, people would have known easily which banks were weak and which were strong, leading to runs on banks that would have resulted in the US taking over some large banks and paying out far more than TARP.
My personal opinion... I would question this valuation based on risk, especially since there is no way government can lose on this. If the banks default, government takes them over and privatizes them down the road. Government always wins. This is, of course, independent of the fact that Buffett won't get tax payments in perpetuity. Government has an incentive to keep these firms afloat.
And we all have a pretty big incentive to keep the banking system working.
While I have no real problem with the government making something on these investments, I want them closer to breaking even than massive profits. I know there will be those who disagree with me, but take a moment, set aside your hatred for bankers, financiers and investors and think about what it would be like to have your government acting like a merchant bank or vulture investor with your tax dollars.
February 05, 2009
Welcome to the fight, Mr. President
Is Summers marginalizing Volcker?
Straight from Bloomberg...Paul Volcker has grown increasingly frustrated over delays in setting up the economic advisory group President Barack Obama picked the former Federal Reserve chairman to lead, people familiar with the matter said.
Volcker, 81, blames Obama’s National Economic Council Director Lawrence Summers for slowing down the effort to organize the panel of outside advisers, the people said. Summers isn’t regularly inviting Volcker to White House meetings and hasn’t shown interest in collaborating on policy or sharing potential solutions to the economic crisis, they said.
While Summers, a former Treasury secretary, oversees the official White House economic policy apparatus, Obama tapped Volcker for a new Economic Recovery Advisory Board charged with injecting fresh, outside ideas into policy debates.
“When you have two strong, highly accomplished, driven people, it’s not unusual that there is going to be a battle over turf,” said James Cox, a professor at Duke University Law School in Durham, North Carolina. “I would hope that Obama doesn’t lose Volcker’s counsel. They need someone to help them think outside the box.”
The contretemps shows the difficulties Volcker, perhaps the world’s most respected economist, may encounter as an outside adviser charged with providing policy alternatives to the president, said William Silber, a finance professor at New York University’s business school.
This is a time to take a moment and remember two things...
1) Paul Volcker is brilliant.
2) Larry Summers is not so much brilliant as he is middling.
Larry Summers, let's not forget, is one of the people inside the Administration who hates infrastructure and, if rumors are correct, is pushing internally the tax cuts the Republicans want. Even though most sane people say they won't do the trick to jolt us out of recession.
We can only hope that the President will slap down Larry and move Volcker to front and center.
Austin Mayor's Race, or, Teh Funny
My post about Brewster being shitty got me to thinking about Brewster and led me to create this horrid little Photoshop. I am truly sorry.
Well, I'm sorry about the quality. I'm spot on about the content.
Lee wins the public safety endorsements!Lee has proven through his steadfast support of Austin's public safety agencies, and particlarly it's public safety workers, that he is the right candidate for Mayor. He will face tough decisions with the struggling economy and he will have to work closely with firefighters, police officers and paramedics to ensure our outstanding public safety service delivery doesn't suffer. Lee has the skills and ability to see us through and the credibility needed to keep the confidence of Austin's public safety workers as they continue to be asked to do more with less.
Stephen Truesdell President, Austin Firefighters' Association
Lee also rolled out a fab new website And there's a new candidate for Mayor, Jesus Christ, Businessman.
Seriously, go read that bio. All that's missing are lepers and turning water into wine. Well, I guess you could say the crucifixion is also missing but it's pretty early in the campaign season. He does look kinda cute in the pic on the website which is a mitigating factor.
Normally, I'd blow over something like this but it's just this kind of nutty on the left that's allowing the right to run hog wild...Jane, RELAX, doll!
We're not paying ANYWHERE near par for these assets. There's already been more than $1 trillion written down and, ultimately, that's pretty close to the bottom.
While I'm no fan of Larry Summers (mostly because he thinks infrastructure as part of the stimulus plan is bad), this really isn't the taxpayer soaking you think it is. Oh, and it might help to keep in mind that Buffet's not making out too well on that investment in GS. There's a really good chance he may get diluted pretty badly.
Circling the goddamn drain...
I read this yesterday...I used to be optimistic about the capacity of our political leaders and central bankers to avoid the policy mistakes that could turn the current global recession into a deep and lasting global depression. Now I’m not so sure.
I'm not quite as worried about some of Buiter's concerns, least of all protectionism (mostly because there's going to be so much demand from China's infrastructure stimulus that basic materials are going to rebound sharply, even in the US). However, I AM concerned about the weakness in Washington. And the more I think about it, the more I'm ready to say, simply, FUCK IT. I can do that. I have money and I can survive a two year depression. Most of you can't.
In fact, a real depression would probably be good for me as it would allow me too pick up some great assets at 90% off their real value. Hell, I might just bail and leave you all here to rot. Maybe I'll be back when you fucks get your heads screwed on right.
Why am I saying all this? Because the public has turned against the stimulus bill. Democrats are actively working against their party and their President with the Republicans on more of this tax cut nonsense. The Republicans are easy... any failure of this bill will lead to a lot of economic pain and Democrats are going to get blamed. The Democrats working against this? They're harder to explain... I think it has something to do with a fundamental inability to understand economics and how to maintain a capitalist economy. I also think they're as goddamn stupid as this guy. Or this idiot who seems to think TARP was a bailout for the wealthy. Guess he wasn't paying attention nor does he seem to care that's it's left the Treasury with actual assets. Because he and those like him never understood TARP or TAF, they've been beating a political drum about it for a while. Now that beat has started to poison the Stimulus Bill.
It's kinda understandable, especially since the media is doing such a bang up job explaining all this to the American people. It almost makes me want to embrace what I see happening, the impoverishment of whole swaths of the country.
All the while our President sits on the sidelines, going on TV, seemingly content to let the whole thing go down the drain while the partisan bitterness he refuses to engage in consumes the Capital. Of course, he could step in and really decimate the Republicans. Maybe he will. But I certainly doubt it. My question, for now, is the same as this one... WHY ON EARTH WOULD OBAMA HAVE EMPOWERED THE GODDAMN STUPID REPUBLICANS??!?!?!?!?!?! Or, WHY THROW THEM ANY BONES IN THE FORM OF TAX CUTS THAT DON'T WORK? Has it occurred to anyone other than myself that President Obama and the Democrats are wasting our money on Republican ideas we know damn well won't work?!?!?!
Maybe, just maybe, the CHANGE we could believe in was nothing more than ineptitude. Not that asshat McCain would have been any better. I'm thinking more along the lines of Clinton or Edwards. God knows either of them would have already passed a much better bill and they would have browbeat the Republicans to do it.
February 04, 2009
Obama and the fourth estate
First off, if anyone was thinking maybe people were too hard on Howard Kurtz, there was this...A lot of people, and not just conservatives, think the media have rolled over for Obama. I've certainly been critical of the coverage at times. But what's past is prologue. If journalists don't start holding the 44th president accountable -- in the same way the left wanted us to hold George W. Bush accountable -- we will have defaulted on our mission. It will be bad for the country, and bad for Obama. He didn't run as a black candidate. He ran as a politician who happened to be black. And so our journalism must be color-blind as well.
REALLY, Howard? Why is it that that chickenshit 'journalists' like you are so scared of losing access during Republican Administrations that you fall over yourselves with fawning coverage, yet when a Democratic President is inaugurated you're at his throat within days? What's that about?
And then there was Michael Gerson who on his best days still reads like a poor man's William F. BuckleyBut there was a second, less sympathetic, Obama enthusiasm at work. In a Newsweek essay, Michael Hirsh mentioned Obama's racial achievement. But he went on to say that "there's something else that I'm even happier about -- positively giddy. . . . What Obama's election means, above all, is that brains are back." Hirsh declared that the Obama era means the defeat of "yahooism" and "jingoism" and "flag-pin shallowness" and "religious zealotry" and "anti-intellectualism." Obama is a "guy who keeps religion in its proper place -- in the pew."
There is much to unpack here. Can it be that Hirsh is "even happier" about the advance of liberal arrogance than he is about the advance of racial justice? And would the civil rights movement have come at all if African American religion had stayed "in the pew"? But suffice it to say that some wish to interpret the Obama victory as a big push in the culture war -- as an opportunity to attack their intellectual and cultural "inferiors."
What's amazing here is that Gerson seriously may not have understood that Hirsh was ecstatic, as we all were, over the fact that the American people picked substance over bullshit, brains and competence over one liners and hunting pictures. You'll have to excuse him for not 'getting it' since he was, after all, a bit player in the circus of retards that was the Administration of George W. Bush. You might remember him as the nebbish speechwriter who took credit for everything which mostly included work he didn't actually do.
Is this kind of bullshit all over the place? Should I just stop reading the Post?
Goddamnit, TinaFish. Could you suck MORE?
We were extremely excited about the prospect of TinaFish being in a position to fuck up the Republicans on a national level. Now we'll have to be content with her incompetence being limited to Texas. It's our mistake for getting our hopes up. The outcome, we should have realized, was entirely dependent on TinaFish actually appearing like she knew how to do anything more complicated than breathing.
February 03, 2009
Stupid people saying stupid thingsThinkProgress has admirably demonstrated that the cable networks continue to tip the scales in favor of Republicans by booking like twice or even three times as many Republicans as Democrats to discuss the Stimulus Bill. But that only tells us what we already know, which is that the Washington press establishment is still wired for Republicans. But there is a Democratic president. And he does have the bully pulpit. And he needs to make this argument, which he's not. Absent that, we can't be surprised and the Democrats are not in much of a position to complain if the vacuum is filled by a bunch of Republicans making statements that are either demonstrable nonsense or just lies.
Look at what people are talking about and you wouldn't get the sense that we're actually in the midst of a major economic crisis that will likely send unemployment well into double digits if nothing is done quickly -- and a crisis that is in large measure the result of the economic policies that the Boehners and Cantors and McConnells are telling us, all the evidence to the contrary, will now save us. Everyone who's taking this situation seriously realizes that spending is the pivotal part of what the government needs to do to stabilize the economy in the face of this crisis. The multipliers for spending versus tax cuts simply leaves no question about that. Ask McCain economic advisor Mark Zandi. The solid critiques from the right aren't about whether spending is needed but which types are most efficient.
At the core, this is going to have to be us talking it up since President Obama and Co. can't manage to do a goddamn thing right since taking office. Oh, I'm sure some of you will point to Gitmo and say THERE but it's the big ticket stuff, like actually VETTING Cabinet noms that they seem to be fucking up nicely.
The economy needs this. I've worked in various parts of the banking industry for more than a decade and can tell you, this is BAD. The situation we're in is precisely the result of greed coupled with a lax regulatory structure and weak legal enforcement. In short, this is the ultimate economic paradise that the policies of Boehner and Cantor and McConnell (not to mention our own Junior John) have already led us to. Only in their idiotic world would more of the same be good. I don't know why I should be surprised since the only one out of the three that's ever held a real job (Boehner) was a salesman. For a packaging company that didn't actually make anything, they just sold what was made by others.
In other words, what these morons have to say about regulation and the efficacy of fiscal stimulus is questionable. At best. Especially in light of the fact that they've been saying the same thing for decades, they got what they wanted and we're all enjoying the ruin where it was destined to lead.
It is not enough any more to support our plan. That time has passed and the Republicans simply will NOT let it go. All that's left is for us to attack THEM. THEY caused this. WE'RE going to fix this.
And it's time the President get geared up and get into the fight. A CHANGE would be a President that actually did something right.
It's time to give old school, knock the other into the dirt and kick him when he's down, politics one last spin.
Say it with me, boys and girls, "TAX CUTS AS STIMULUS DON'T WORK". They didn't work last year, they won't work this year. TARP has started to work to stabilize the financial system. We need this to the economy itself working again and put people back to work. It would also be nice if Geithner would step on the banks to start lending again.
McCain? Oh, bitch, you don't want to start name calling.
You know, I've been putting off posting about this for more than a week, mostly because I've been busy with real work as opposed to Brewster who is busy taking credit for things he really didn't do. Oh, and changing his mind about where he stands on issues. However, I guess it's time to say something about it...“You may have heard that both of Brewster’s opponents have chosen to run on the John McCain campaign message: ‘a steady hand in troubled times.’ Brewster believes we need to expect more of Austin’s next mayor than simply trying to hunker down and weather the storm for a few years. In fact, that approach would cost us valuable time while other regions work to establish leadership in the emerging job sectors of the 21st Century Economy.”
So now Lee is John McCain? What does that make you, Brewster? Sarah Palin? I mean, you're certainly not President Obama or anyone on the Democratic side. Actually, you really ARE a lot like Palin, always loving the attention, just like a stupid little puppy, and taking credit for things you didn't do while hiding from the crap you did.
I've heard Brewster called a weathervane. I've heard him called a windsock. I've heard him called a flip-flop. All of these are accurate but I think the term that works even better is TOFU because of his ability to take on whatever message or issue the constituency he's talking to at the time cares about.
And if there's one thing I know we need right now, it's innovation and leadership, with balls. Not a meat substitute.
Fuckin' up with the President
Daschle? REALLY? FORMER Senator Tom Daschle, the meekest Senate Majority and Minority leader in the history of the US Congress? The guy who makes Harry Reid look charismatic?In Washington there are whores and there are whores, and then there is Tom Daschle. Tom Daschle would suck off a corpse for a cheeseburger. True, he is probably only the second-biggest whore for the health care industry in American politics — the biggest being doctor/cat-torturer Bill Frist, whose visit to South Dakota on behalf of John Thune in 2004 was one of the factors in ending Daschle's tenure in the Senate.
But in picking Daschle — who as an adviser to the K Street law firm Alston and Bird has spent the last four years burning up the sheets with the nation's fattest insurance and pharmaceutical interests — Obama is essentially announcing that he has no intention of seriously reforming the health care industry. . . .
This, of course, dovetails rather nicely with two of President Obama's foundering campaign promises... Ethics Reform and Healthcare Reform.
UPDATE - Daschle withdraws! YAY!
Uniball and the Magic Smoking Crusade...
Why is it that EVERY FUCKING ARTICLE about Lance Armstrong has to mention that he's a survivor of testicular cancer, especially when the article is about a smoking ban?
Seriously, smoking doesn't give you ball cancer. Bad genetics and doping are usually the factors that cause testicular cancer. I just don't understand why it has to be mentioned in the same damn sentence. Take this one, for example, from an article about the roll out of the anti-smoking anywhere crusade...On Thursday, when seven-time Tour de France winner and cancer survivor Lance Armstrong stood outside the Texas Capitol to tell supporters that he was calling on lawmakers to support a statewide smoking ban, about seven protesters held signs telling him to "butt out" or "Go back to France."
The funny thing? This is an article about the protesters being treated unfairly by State Troopers, not about the ban or Lance Armstrong. The press falls all over this guy but really, everyone else is just sick of his shit. Of course, they're really going to enjoy him telling them that they can't have a drink and a cigarette at a bar.
I'll let you all in on a little secret... we smoke to make the annoying losers like Lance Armstrong go away. We don't want you little pipsqueaks around, get it? If you've ever whined about a club or a bar being 'smokey', you're one of those people. People stopped inviting you out because, really, you're a goddamn drag.
Just wanted you to know.
Roundin' Up The TPA
It is time for another edition of the Texas Progressive Alliance's Weekly Blog Round-Up.
In her first ever YouTube video, TXsharon shows the emissions boiling into the air when a Barnett Shale gas well undergoes hydraulic fracture.
The Texas Cloverleaf shows that pictures can tell a thousand words. And the pictures of ships at anchor in Singapore is telling the world we are screwed.
Burnt Orange Report discusses the over 22,000 voters
being purged from the Hidalgo County Voter Rolls.
Redistricting isn't just a state issue. The City of Houston is under pressure to redraw its City Council lines Off the Kuff takes a look at where this stands.
BossKitty at TruthHugger is amazed at the social progress creeping around the world. America elects a half black, half white President. Iceland appoints an openly lesbian Prime Minister. Whats next? Yes We Can - Iceland Courageous
Easter Lemming Liberal News writes his congressman while considering the Republican death spiral.
WhosPlayin announced 46,000 layoffs this past week - just in the blogging industry.
Over at Texas Kaos, Libby Shaw's keeping an eye on Senator Jackass of Texas as he tries to heighten his national profile at the expense of American families. in his latest hit, the buckskin fringed one votes against children having health care. Again.
The Republicans are having an identity crisis, and the election of Michael Steele as RNC chair is not likely to help them solve it. PDiddie at Brains and Eggs observes that Rush Limbaugh is still calling the shots, and they are all cheap.
Neil at Texas Liberal offers some thoughts on city elections in Houston.
February 02, 2009
Do businesses pay for their pollution?
Apparently, no. And TCEQ's fines are more a cost a doing business than an actual deterrent.The recent pollution history of prominent Texas company Exxon Mobil Corp. helps put the numbers in perspective.
On a January day nearly three years ago, the three-member Texas Commission on Environmental Quality told Exxon Mobil that it owed $8,662 for a single pollution episode. Investigators had found that the company had failed to obtain permits and to record unauthorized emissions, according to state records.
Despite the fines, Exxon Mobil's Harris County chemical plants violated pollution rules at least nine times over the rest of 2006, belching into the air tons of carbon monoxide, smog-related chemicals and carcinogens. One of the emissions violations, according to state records, ran 201 hours.
The total bill for those penalties came to $146,450.
But the violations kept occurring. In 2007 the firm was fined 10 separate times to the tune of $247,066 — an incidental cost, critics say, for a corporation that had $11.66 billion of profit in the final three months of that year, or $264,000 every three minutes.
"You hope that you hold a company accountable for violating the law with a certain threat of a high penalty that will deter the company from violating the law in the first place, or deter them from doing it again," said Tom McGarity , an environmental law professor at the University of Texas. "But you figure they have written the penalty into the cost of doing business. It costs more to do something about it, to remedy the problem."
So much for those pesky songwriters
Faster than you can say Bernie Taupin, Microsoft has created the most awesomest piece of software evah! Songsmith will allow your computer to write really good songs that will make everyone envy you.
Did I mention it's by Microsoft? Their software is ALWAYS hella good.
February 01, 2009
In other news...
Conyers has issued another subpoena for Rove..."Change has come to Washington, and I hope Karl Rove is ready for it," Conyers said. "After two years of stonewalling, it's time for him to talk."
Robert D. Luskin, an attorney for Rove, said his client will "abide by a final decision from the courts." Luskin noted that Bush, in a letter to Rove, recently reasserted executive privilege.
"It's generally agreed that former presidents retain executive privilege as to matters occurring during their term," Luskin said. "We'll solicit the views of the new White House counsel and, if there is a disagreement, assume that the matter will be resolved among the courts, the president and the former president."
For my money, I think Bush's biggest fuckup was not giving a full pardon to Karl Rove. Now, the son of a bitch is toast. Well, he is as long as the President decides to uphold the rule of law instead of executive privilege.
Via Stop The Death Penalty comes a link to an op/ed in the Statesman talking about how ridic it is that the Federal Courts have to step in to stop an execution our Governor (and the Criminal Court of Appeals) were too gutless to stop. Ladies and Gentleman, the return of SCIENCE Collin County now has a toll road authority! I can't WAIT to hear about all the fights between them and the NTTA!