Posts Tagged ‘13%’

With Eyes Finally Wide-Open, Reconsider Why The Economy Collapsed In The First Place

December 31, 2009

We are now able to see that from the very beginning of the Obama administration, the Republican Party has again and again demonstrated that they were completely right and Democrats were completely wrong.  Whether you look at the stimulus, cap-and-trade, bogus climate change claims, health care, or terrorism, Americans now solidly agree that Republicans were represent the people; and that Democrats do NOT represent the people.

Right now, a solid plurality of Americans thinks the stimulus (that 99% of Republicans voted against) harmed the economy.  And the people are starting to realize what an ideological partisan slush fund the stimulus was (also predicted by Republicans).

When Obama was elected, unemployment was at 6.6%.  He promised that his stimulus would prevent unemployment from reaching 8%.  And now it’s at 10%, and it’s going to get higher.

Obama demagogued Bush’s spending.  But Bush deficits -bad as they were – were only 2-3% of GDP.  Obama’s deficits are 12.8% of GDP – which is five to six times higher.

Now that your eyes are finally beginning to open wide and see Obama and the Democrats for who and what they truly are, let me point out a few things about the past collapse.

What Americans – and particularly Americans who actually vote – need to realize is that Democrats were trying to do this kind of crap and play these kind of games all along.  They were trying to do it throughout the Bush years, when George Bush tried 17 times to regulate the out of control and Fannie-Mac-and-Freddie-Mae-dominated housing mortgage markets – and Democrats thwarted him over and over again.

Why do I mention the Government Supported Enterprises (GSEs) Fannie Mae and Freddie Mac?  Because they were at the very heart of the mortgage meltdown.

The LA Times writes on May 31, 1999 that:

Lenders also have opened the door wider to minorities because of new initiatives at Fannie Mae and Freddie Mac–the giant federally chartered corporations that play critical, if obscure, roles in the home finance system. Fannie Mae and Freddie Mac buy mortgages from lenders and bundle them into securities; that provides lenders the funds to lend more. . . .

LaVaughn M. Henry, Ph.D. Director, U.S. Economic Analysis The PMI Group, Inc. December 9, 2008, pointed out:

The Role of the GSEs is to provide liquidity and stability to the U.S. housing and mortgage markets. Step 1 Banks lend money to Households to purchase and refinance home mortgages Step 2 The GSEs purchase these mortgage from the banks Step 3 GSEs bundle the mortgages into mortgage-backed securities Step 4 GSEs sell mortgage-backed and debt securities to domestic and international capital investors Step 5 Investors pay GSEs for purchase of debt and securities Step 6 GSEs return funds to banks to lend out again for the issuance of new mortgage loans.

It was steps 3-5 that messed us up.  Fannie and Freddie bought mortgages – including many mortgages that poor and minority homeowners couldn’t begin to afford under the mandate of the Community Reinvestment Act – bundled them such that no one could assess their risk, and then sold them to private companies such as Bear Stearns and Lehman Brothers.  Fannie and Freddie were exempt from SEC [Securities and Exchange Commission] regulations.   The GSEs could bundle up mortgages, which would then be rated AAA, with no requirement to make clear what was in the bundle.  Private companies believed that the bundled securities were guaranteed, since they were essentially being sold by the federal government.

But there were many who predicted that this system – created and maintained by Democrats – could explode.

From the New York Times in September 30, 1999:

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.“

”From the perspective of many people, including me, this is another thrift industry growing up around us,”
said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.” . . .

And that is precisely what happened.  There was a downturn (and there will ALWAYS be downturns, won’t there?), and Fannie and Freddie were so leveraged that they collapsed and caused the collapse of the entire industry.  Financial experts anxiously pointed out that a decline of only 1.3% would bankrupt Fannie and Freddie because they were leveraged to the tune of 60%? to 78%.

Democrats were the priests and acolytes of the GSE system.  They protected it, and they were the ones who pressed all the buttons and pulled all the levers.

Keven Hasset concludes an article titled, “How the Democrats Created the Financial Crisis“, concludes by saying:

Now that the collapse has occurred, the roadblock built by Senate Democrats in 2005 is unforgivable. Many who opposed the bill doubtlessly did so for honorable reasons.  Fannie and Freddie provided mounds of materials defending their practices.  Perhaps some found their propaganda convincing.

Watch this video showing how Goerge Bush and John McCain repeatedly warned of the economic collapse (length=4 min):

Watch this video of Democrats protecting and covering for Fannie Mae (length=8 min):

Here’s a video entitled “Burning Down the House: What Caused Our Economic Crisis?” (length=11 min)

And then we find that Barack Obama was in bed with Fannie and Freddie and their shockingly risky policies:

Who really exploded the economy in 2008, liberals or conservatives? Who do you think?  The liberal mainstream media allowed Democrats to blame George Bush simply because he was president at the time, never mentioning that the Democrats who controlled both the House and the Senate relentlessly opposed everything Bush tried to do; and it allowed Democrats to not have to account for the fact that they’d been in complete control of both the House and the Senate.  But remember that the economy went from outstanding to collapsed during the two years (2006-2008) that the Congress was under Nancy Pelosi and Harry Reid.  The unemployment rate was 4.4% when Republicans last ran Congress.  What is it now, three years of Nancy Pelosi and Harry Reid later?

Few people understand how huge Fannie and Freddie are, or how deeply burrowed they are in the mortgage industry.  But let me put it to you this way: the federal government now underwrites 9 out of 10 residential mortgages.

John McCain tried to warn us in 2006:

I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.

But he was ignored.

When George Bush first tried to regulate an already out-of-control liberal bastion of Fannie and Freddie, Barney Frank led the united Democrat opposition and said:

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

And just before Fannie and Freddie collapsed and brought down the entire housing mortgage industry with it creating the economic meltdown, Barney Frank – continuing to stop any regulation of Fannie and Freddie – said this:

REP. BARNEY FRANK, D-MASS.: I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.

Fannie Mae and Freddie Mac went completely bankrupt, and had to be bailed out by the government.  It had been Fannie and Freddie which had the sole authority to buy mortgages, bundle them into the mortgage-backed securities which ultimately exploded, and sell those securities to private companies (as I have already shown).  Just as it was Fannie and Freddie which had been the seller of subprime loans.

Democrats demonized and demagogued Republicans by blaming them for a mess that DEMOCRATS created.  And Republicans were to blame primarily because they didn’t do enough to stand up and courageously oppose the disaster that Democrats had created

A couple weeks ago the New York Times reported that Fannie and Freddie would get a whopping $800 billion to cover losses incurred under the Obama administration (and see another article on this $800 billion fiasco here):

Fannie Mae and Freddie Mac, which buy and resell mortgages, have used $112 billion — including $15 billion for Fannie in November — of a total $400 billion pledge from the Treasury. Now, according to people close to the talks, officials are discussing the possibility of increasing that commitment, possibly to $400 billion for each company, by year-end, after which the Treasury would need Congressional approval to extend it. Company and government officials declined to comment.

But it turned out that that was wrong.  Fannie Mae and Freddie Mac weren’t going to get $800 billion.  That won’t be nearly enough.  They are going to get an unlimited amount of funding (potentially in the trillions):

From the Wall Street Journal, December 26, 2009:

The Obama administration’s decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie MaeFreddie Mac over the next three years and stirred controversy over the holiday.

A Newsbuster article, entitled, “Relief Without Limits,” provides an excellent resource of facts and commentary on this incredible and terrifying development.

Remember the righteous outrage of Democrats and the Obama administration over the compensation of CEOs of private banks?  The Democrats don’t seem to mind when Fannie and Freddie execs get huge compensation packages.

The monster rises yet again, and larger and uglier and more dangerous than it has ever been before.  And just like the first time it collapsed, Democrats are in total control of it.  Fannie and Freddie stock went up significantly as the news was announced.  Watch it dwindle back to zero by the end of 2010.

We’re facing another tsunami of foreclosures in 2010.  And three mortgages get worse for every single one that improves.

And even uber-liberal sources like the Huffington Post are acknowledging that Obama’s policies have utterly failed:

Anatomy of a Failed Foreclosure Program (dated 12-07-09)

Just how badly is President Obama’s $75 billion foreclosure program working out? Consider these newly-released numbers: Out of every 100 homeowners who came to JPMorgan Chase for help under the program, just 15 have or will likely receive a permanent payment reduction.

What happened to the other 85? For every 100 trial plans initiated from April through September 2009 under the Home Affordable Modification Program:

  • 29 borrowers did not make all required payments under their trial plan;
  • 20 borrowers did not submit all documents required for underwriting;
  • 31 borrowers submitted all required documents but the documents did not meet HAMP underwriting standards, due to such things as missing signatures or nonstandard formats;
  • 4 borrowers were or are likely to be rejected for undisclosed reasons;
  • 1 borrower will not or is not likely to get their payment lowered.

The data comes from the prepared remarks bank officials plan to make Tuesday before the House Financial Services Committee. The testimony was posted Monday on the committee’s website.

It adds up to a brutal illustration of just how the HAMP program, which is supposed to reduce troubled homeowners’ monthly payments to 31 percent of their income, is failing.

Failing.  As in “failing grade.”  As in failed Obama presidency.

You still don’t know the half of it.  Obama’s $75 billion mortgage modification bailout is costing taxpayers an average of $870,967 PER HOUSE when the average house is worth only $177,900.

Famed analyst Meredith Whitney predicted that unemployment would rise to 13% or higher primarily due to the failure to contain the failure to deal with the mortgage industry:

Unemployment is likely to rise to 13 percent or higher and will weigh on the economy for several years, countering government efforts to stabilize the banking industry, analyst Meredith Whitney told CNBC. [...]

“We underestimate how much the whole economy is dependent on the mortgage industry, and that has to change,” Whitney said. “This is what happens when you delay the inevitable. We’re buying time here, but we’re not restructuring the economy.”

Under the radar, and against the objections of Republicans that was primarily covered only by C-SPAN, Democrats implemented and then fiercely protected policies that were almost guaranteed to doom our economy.  When the meltdown finally occurred, the same Democrats who created the black hole in the first place flooded the airwaves and blamed George Bush – whom they had already vilified and brought down through unrelenting attacks using the Iraq War as their main foil.

The propaganda worked, and Barack Hussein Obama – a politician who is more beholden to corrupt and frankly un-American entities like Fannie Mae and Freddie Mac, ACORN, and the SEIU than any president in history.

And now we’re truly paying for our stupidity.

Obama is taking the same policies that imploded our economy, and multiplied them by a factor of ten.  It’s only a matter of time before his policies create a rotten floor for our economy to plunge through all over again — only this time far, far worse than before.

Someone might say, “But look, Obama is rebuilding the economy.  He’s brought back the stock market, and things are getting better.”

First of all, they really aren’t getting better, and the Dow can drop a lot faster than it can rise (history lesson: there were several rises and crashes of the stock market during the Great Depression).  And second of all, if you loan me a few billion dollars to spread around, I can temporarily bring up the production of my local economy, too.

Just don’t expect either me or Barack Hussein to repay the loan when it comes due.

Obama has been compared – and has compared himself – to FDR.  We now know that for all of FDR’s popularity, his “reforms” during the Great Depression were massive failures which actually kept the United States in depression for seven years longer than if he’d done nothing at all.

Henry Morganthau, FDR’s Treasury Secretary, said in May 1939, after nearly seven years in office:

“We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong… somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises… I say after eight years of this Administration we have just as much unemployment as when we started… And an enormous debt to boot!”

In believing the propaganda and lies of the Democrats and Barack Obama, Americans may have well placed the nation in a hole that it very may well not be able to climb out of.

Obama And The HUGE Health Care Tax That He Simply Refuses To Call A Tax

September 21, 2009

At the Oct. 7 presidential debate, Barack Obama said, “If you make less than a quarter of a million dollars a year, you will not see a single dime of your taxes go up. If you make $200,000 a year or less, your taxes will go down.”

I point this out so that you realize that Obama supports your (note: use any word but “taxes” here) going up by 85800 dimes if your family makes $66,000 a year.  More on that later.

And as part of my “I told you so” moment, allow me to cite my October 2008 article entitled “Obama-Biden Will Come After Middle Class With Taxes.”

Our Narcissist-in-Chief appeared on five Sunday morning political talk show programs to sell the current iteration of ObamaCare.  During his time with George Stephanopoulos on ABC’s “This Week,” there was this exchange:

STEPHANOPOULOS: You were against the individual mandate…

OBAMA: Yes.

STEPHANOPOULOS: …during the campaign. Under this mandate, the government is forcing people to spend money, fining you if you don’t

How is that not a tax?

OBAMA: Well, hold on a second, George. Here — here’s what’s happening. You and I are both paying $900, on average — our families — in higher premiums because of uncompensated care. Now what I’ve said is that if you can’t afford health insurance, you certainly shouldn’t be punished for that. That’s just piling on.

If, on the other hand, we’re giving tax credits, we’ve set up an exchange, you are now part of a big pool, we’ve driven down the costs, we’ve done everything we can and you actually can afford health insurance, but you’ve just decided, you know what, I want to take my chances. And then you get hit by a bus and you and I have to pay for the emergency room care, that’s…

STEPHANOPOULOS: That may be, but it’s still a tax increase.

OBAMA: No. That’s not true, George. The — for us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase. What it’s saying is, is that we’re not going to have other people carrying your burdens for you anymore than the fact that right now everybody in America, just about, has to get auto insurance. Nobody considers that a tax increase.

People say to themselves, that is a fair way to make sure that if you hit my car, that I’m not covering all the costs.

STEPHANOPOULOS: But it may be fair, it may be good public policy…

OBAMA: No, but — but, George, you — you can’t just make up that language and decide that that’s called a tax increase. Any...

STEPHANOPOULOS: Here’s the…

OBAMA: What — what — if I — if I say that right now your premiums are going to be going up by 5 or 8 or 10 percent next year and you say well, that’s not a tax increase; but, on the other hand, if I say that I don’t want to have to pay for you not carrying coverage even after I give you tax credits that make it affordable, then…

STEPHANOPOULOS: I — I don’t think I’m making it up. Merriam Webster’s Dictionary: Tax — “a charge, usually of money, imposed by authority on persons or property for public purposes.”

OBAMA: George, the fact that you looked up Merriam’s Dictionary, the definition of tax increase, indicates to me that you’re stretching a little bit right now. Otherwise, you wouldn’t have gone to the dictionary to check on the definition. I mean what…

STEPHANOPOULOS: Well, no, but…

OBAMA: …what you’re saying is…

STEPHANOPOULOS: I wanted to check for myself. But your critics say it is a tax increase.

OBAMA: My critics say everything is a tax increase. My critics say that I’m taking over every sector of the economy. You know that.

Look, we can have a legitimate debate about whether or not we’re going to have an individual mandate or not, but…

STEPHANOPOULOS: But you reject that it’s a tax increase?

OBAMA: I absolutely reject that notion.

This little chunk of dialogue should show anyone what a truly disingenuous little weasel Barack Obama truly is.

Let’s start with the “critics say it is a tax increase” part that Obama deceitfully jumped all over.  Obama’s answer makes it seem that all the people characterizing the “individual mandate” as a “tax increase” are rightwing Republican loons.  But – to allude to Joe Wilson’s famous outburst – Obama lies.

It’s not just conservatives who are calling it a tax increase.  Senator Max Baucus, the author of the Senate bill – HIMSELF calls it a tax increase, as the Politico article entitled, “Baucus bill calls individual mandate a tax, Obama says it isn’t” kind of proves.

And it isn’t just Max Baucus who calls it a tax.  The bill itself calls it a tax:

Page 29, sentence one of the bill introduced by Senate Finance Committee Chairman Max Baucus (D-Mont) says: “The consequence for not maintaining insurance would be an excise tax.”

And just in case someone wants to argue that Obama wasn’t familiar with the details of the Baucus bill because it’s so recent (in which case an honest man would have simply kept his mouth shut), allow me to refer to the House bill that has been around for months:

From HR 3200, page 167, line 15:

What the bill says, pages 167-168, section 401, TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE:

‘‘(a) TAX IMPOSED.—In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of—

(1) the taxpayer’s modified adjusted gross income for the taxable year, over

(2) the amount of gross income specified in section 6012(a)(1) with respect to the taxpayer. . . .”

EVALUATION OF THE PASSAGE:

1. This section amends the Internal Revenue Code.

2. Anyone caught without acceptable coverage and not in the government plan will pay a special tax.

3. The IRS will be a major enforcement mechanism for the plan.

And if that isn’t enough to convince someone that Obama is flat-out lying to the American people, let’s go back to his days on the campaign trail to see that he very much knew that his health care agenda was going to cost huge money that would require heavy taxation:

So the “notion” that Obama “absolutely rejects” is absolutely true.  It’s Obama who is lying.

And fortunately, at least some part of the mainstream media realizes it.  In their article entitled, “FACT CHECK: Coverage requirement enforced with tax,” the Associated Press begins by saying:

WASHINGTON – Memo to President Barack Obama: It’s a tax.

So when Obama says, “My critics say everything is a tax increase.”  And, “My critics say I’m taking over every sector of the economy,” maybe people will finally start to trust us when we tell them that everything he’s proposing IS a tax increase, and he really IS taking over every sector of the economy.

You just can’t trust this guy.  He’s the kind of fellow who would candy-coat cow pies and sell them by the dozen.

Let’s look at just how disingenuous and deceitful Obama is as he tries to sell his lie.  He says to Stephanopoulos:

“No, but — but, George, you — you can’t just make up that language and decide that that’s called a tax increase.”

And so Stephanopoulos – perfectly reasonably – referred to the dictionary to demonstrate that he was hardly “making up language” as Obama had just falsely claimed:

“I — I don’t think I’m making it up. Merriam Webster’s Dictionary: Tax — ‘a charge, usually of money, imposed by authority on persons or property for public purposes.’”

And you can just wrap up every lie, every fallacy, every disinformation tactic, every pile of crap, ever uttered by this Weasel-in-Chief in this one amazing rhetoric:

“George, the fact that you looked up Merriam’s Dictionary, the definition of tax increase, indicates to me that you’re stretching a little bit right now. Otherwise, you wouldn’t have gone to the dictionary to check on the definition.”

So Obama begins by saying that the notion that the government mandate on individuals being “tax increase” is “made-up language”, and then tries to say that referring to a dictionary and documenting that it is clearly NOT made up language somehow demonstrates the opposite of what it in fact clearly demonstrates.

This is a president who truly believes that you are stupid.

Now that we’ve pointed out that 1) Obama is a liar who 2) thinks you’re stupid and that 3) it clearly IS a tax increase, let us see just how huge of a tax increase that Obama wants to foist on the sea of drooling idiots he calls America.

Under the section entitled, “Would there be an individual mandate?” Time Magazine answers:

Yes. Beginning in 2013, individuals would be required to have health insurance. Individuals and families who do not have insurance for more than three months in a given year would be subject to an annual excise tax of $750 and $1,500, respectively, if their income is below 300% of the federal poverty line (or $66,150 for a family of four). Tax penalties for individuals and families with incomes above that would be $950 and $3,800. The excise tax would be waived for Native Americans and individuals and families whose health-insurance costs would be more than 10% of their annual income.

George Will brings that paragraph into sharp focus in the discussion that followed Obama’s appearance, saying:

“And this week, George, something immense happened, and that is we got a big number. Actually, we got a little number. We deal with hundreds of billions and trillions of dollars in talking about this. The number that came out this week is 13 percent.

They said 13 percent of a family’s income, a family making $66,000 a year, about $15,000 over the median income, about 13 percent of their income under this plan would go for health care, not counting co-payments and not counting deductibles.”

That’s right.  The tax increase that Obama deceitfully refuses to call a tax increase (because that would expose his even more fundamental lie that he would LOWER TAXES for people making less than $200,000 a year) would cost a family making $66,000 a year a whopping $8,500 bucks – not counting co-op payments or deductibles.

That’s 85,850 dimes for those of you who bought Obama’s campaign promise.

So we’re not just talking about a giant lie; we’re talking about an incredibly expensive lie.  Quite possibly the most expensive lie in American political history.

Barack Obama is a man who literally began his presidential run with a lie:

MR. RUSSERT: But, but—so you will not run for president or vice president in 2008?

SEN. OBAMA: I will not.

As another gigantic lie, Obama promised that he would accept federal matching funds if John McCain did (which McCain kept his word and did).  In rejecting federal matching funds, Obama became the first candidate to reject such funds.  After hypocritically and self-righteously praising the federal matching funds system as “limiting the corrupting influence of money on the race.”

Obama is even worse than a liar. He is a deceiver; he carefully crafts a story with just enough of the truth in it to fool you so you will buy a whole package of lies.

An awful lot of people who voted for Obama or who are supporting his health care plan are going to find themselves very, very shocked if Obama gets anything close to his way.

Don’t believe this president who was against individual mandates before he was for them.  And don’t forget his amazing lie that a huge tax increase isn’t a tax increase.

ACORN Willing To Help Pimp, Prostitute Cheat To Buy House, Import 13 Underage Illegal Immigrant Child Prostitutes

September 12, 2009

Some things are just so vile it is impossible to believe unless you see it with your own eyes.

I thought that ACORN – the community organizing group that Obama once worked for – was despicable.  But even Michelle Malkin – who wrote the book exposing Obama’s Culture of Corruption – has to be shocked by this total depravity.

Part I:

Part II:

The full transcript detailing the loathsome abomination that is ACORN as its representatives try to do whatever they can to help a pimp and a prostitute who want to cheat on their taxes while buying a house so they can import 13 child illegal immigrant prostitutes from El Salvador and declare some of them as “dependents” is available here.  Just make sure you have a very large bucket close at hand if you watch the videos or read the transcript.

Just to make sure you understand, ACORN has received tens of millions in federal tax dollars and now under Obama will have access to BILLIONS more to help pimps and their prostitutes (that’s ‘performing artist’ to ACORN for income tax purposes) cheat on taxes so they can buy homes so they can bring in illegal immigrant child prostitutes.

If it could get worse, it gets worse.

I watched with the same nauseous revulsion as CNN managed to demonstrate why the mainstream media is essentially a kingdom of cockroaches, with one crawling on top of one another to broadcast their leftwing apologetics and propaganda.

CNN correspondent Bill Tucker begins by making sure everyone knows that these are “two activist conservative filmakers” (that’s journalistic code for ‘people we hate and want to delegitimize’).  They’re conservatives; you all know what to expect from their ilk.  In the introduction of Ron Christie, host Kitty Pilgrim had to make sure everyone knew that he was “conservative,” too.

Keith Richburg of the Washington Post begins to speculate on the ACORN statement that:

“these conservative filmmakers went around to three or four offices and basically got thrown out with this ruse; and they found one office where there were two people stupid enough to sit down and give them this kind of silly advice.

And it sounds to me like that’s just entrapment.  Let’s go around to me like that’s just entrapment.  Let’s go around to various offices until we can finally trick somebody into…”(inaudible due to Joe Conason interrputing to one-up Richburg with his outrage over the “conservative filmkakers” rather than what they revealed about ACORN).

Joe Conason of Salon said:

“It’s not journalism unless they report everything that happened.  It’s propaganda.  If you are a reporter and you’re doing something like this, then you would report, “Yes, we went to the four offices, and one took the bait.”  If you don’t report that, if you act as if you went to one office and they did it, that’s dishonest.”

When Ron Christie began to explain just how outrageous this moral depravity was, Joe Conason interrupted him repeatedly.   Conason, after all, is a “journalist”; therefore he had to make sure that ACORN was protected – regardless of how personally rude and professionally awful he had to be to do it.

I mean, for God’s SAKE!  These were a couple of kids doing this project, not hardened reporters making sure they lived up to far higher journalistic standards of objectivity than any mainline media outlet ever attained.  You can KNOW they weren’t “reporters” or “journalists” because they actually bothered to go into an ACORN office and expose the truth about what was going on inside.  You can bet your britches that no mainstream media “journalist” would ever do something like that.

The Washington Post and Salon are shockingly corrupt in having propaganda hacks like Richburg and Conason working for them.  Think about it: we have ACORN officials on film trying to help a pimp and his prostitute cheat on taxes so they can buy a house so they can start a business by bringing underage young illegal immigrant girls into the country to prostitute for them.  And their anger, their self-righteous rage, is directed at the two kids who exposed this?

Consider the phony outrage over the fact that these kids might have gone to three or four locations to film their project.  I mean, the fact that only 1 in 3 ACORN offices will help prostitutes cheat on their taxes so they can start businesses by pimping out young illegal immigrant girls is just SO reassuring.

Oh, but just one thing.  Now it is coming out that in fact the kids who went to at least a couple of ACORN offices DIDN’T go 1 for 3 — rather, they are batting the hall-of-fame average of at least .500 (and maybe .667).  It turns out that the Washington ACORN office feature the same kind of amoral slimeballs that the Baltimore office had.

One day after two ACORN officials in Baltimore were fired for offering to help a man and woman posing as a pimp and prostitute to engage in child prostitution and a series of tax crimes, another secretly shot videotape has surfaced that shows the same couple getting similar advice from ACORN officers in Washington.

The newly released videotape, shot on July 25, shows ACORN staffers explaining to the pair how they can hide the woman’s professed work — prostitution — and get a loan that will help them establish a brothel.

UPDATE, September 14,2009: And now, lo and behold, ANOTHER ACORN office – this time in Brooklyn, New York – has now been revealed to have stumbled all over themselves to help a prostitute and her pimp cheat on their taxes in order to buy a house so they could import very young El Salvadoran illegal immigrant girls into the country to set up a prostitution business.  That’s at least THREE.  I think that’s more than enough to say we have a very clear trend.

So much for your bullcrap theory, Keith Richburg and the Washington Post; so much for your sorry load of fertilizer that you pass of as “journalistic ethics,” Joe Conason and Salon.  You are two sorry specimens of humanity.  You two representatives of a loathsome, dishonest, and disgraced media.  The reason the two young kids didn’t disclose that they had gone to more than one ACORN office is because they revealed the sheer and vile depravity of more than one ACORN office.

So ACORN has been plainly revealed to be about as vile of an organization as a pedophile can dare to imagine; and not by professional journalists and reporters, but by a couple of kids with a testable theory that ACORN is corrupt and utterly evil and some video equipment.  And the Washington Post, Salon, and the rest of the mainstream media are revealed to be even bigger biased buttkissing ideologues and beneath-contempt frauds than they already were.

Our system is completely broken, and this country is dying.  Special interests such as ACORN own the system, and their liberal media lackeys won’t allow the light of day to ever shine into the pit of vipers.  And our system cannot even possibly be repaired, because our journalists – charged by the Constitution with being honest watchdogs who protect society by exposing the truth – have become so dishonest, so corrupt, so biased, so ideological, and frankly so irredeemably depraved, that they WILL NOT report the truth.

ACORN is safe.  America is under the worst kind of attack as termites eat away at our foundations and infrastructures from the inside out and maggots devour the rotting carcass of a decaying national system.

This isn’t just ACORN.  ACORN is the community organizing arm of the Democrat Party, and the Democrats have protected them, advanced their agendas, and provided them with massive federal funding.  As you watch these videos and reflect on the complete evil that they reveal, realize that the ACORN tree grows out of the Democrat Party.

Is This Economic Recovery? ’1,000 Banks To Fail In Next Two Years’

August 31, 2009

Studies galore have demonstrated the bias of the media.  They have documented that more than 80% of supposedly objective journalists are Democrats.  And they have documented that their personal bias shaped their professional bias, with the media overwhelmingly favoring their “first love,” Barack Obama in the presidential campaign.

Their bias runs to even the smallest and most seemingly trivial matters, on the apparent theory that there is nothing to small to use to attack and undermine a Republican: journalists who stumbled all over themselves to praise Obama’s strenuous exercise rituals and his “chiseled pectorals” found Bush’s exercise “obsessive” and “creepy.” The media wouldn’t even allow President Bush to golf without attacking him for abandoning his duties, whereas they don’t attack Obama – even though he’s playing gold far more often than Bush did – and even golfing with a CEO of a firm in the midst of a tax corruption investigation.

So it really shouldn’t surprise anyone that the media would show its bias in big matters such as the economy.

University of Maryland senior research scientist John Lott Jr. says news coverage of the economy is slanted. Lott writes, “Over 78 percent more negative news stories discussed a recession when the economy — under a Republican president was soaring than occurred under a Democrat when the economy was shrinking.”

Lott — who researched 12,500 newspaper and wire service articles from 1985 through 2004 — also found that Democratic presidents got positive headlines 15 percent more of the time than Republican presidents for the same economic news.

Of his findings Lott writes, “The media’s focus on the negative side of everything surely helps explain people’s pessimism… Indeed, research has indicated that media bias is real.”

The media helped Obama fearmonger the economy when he wanted them to fearmonger the economy to push through his stimulus; but now they’re are trying to talk up the economy when Obama wants them to talk up the economy.  They are dutifully reporting that the recession seems to be over.

But it isn’t.  And it won’t be.

1,000 Banks to Fail In Next Two Years: Bank CEO
Published: Thursday, 27 Aug 2009
By: Natalie Erlich

The US banking system will lose some 1,000 institutions over the next two years, said John Kanas, whose private equity firm bought BankUnited of Florida in May.

“We’ve already lost 81 this year,” Kanas told CNBC. “The numbers are climbing every day. Many of these institutions nobody’s ever heard of. They’re smaller companies.” (See the accompanying video for the complete interview.)

Failed banks tend to be smaller and private, which exacerbates the problem for small business borrowers, said Kanas, who became CEO of BankUnited when his firm bought the bank and is the former chairman and CEO of North Fork bank.

“Government money has propped up the very large institutions as a result of the stimulus package,” he said. “There’s really very little lifeline available for the small institutions that are suffering.”

This comes at a time when the FDIC has established new rules on bank sales. Private equity, for instance, would have to hold double the capital of their competitors in order to buy such an institution, said Kanas.

“This will have somewhat of a chilling effect on our participation,” he said. “As a result of having to keep higher capital levels, we’ll see lower prices coming from that sector.”

Of the 81 failed banks this year, two have been successfully acquired by private equity, he said. Kanas’ private equity firm bought UnitedBank, the failed Florida-based bank, from the FDIC in May. Regulators also allowed the sale of IndyMac Bank of California earlier this year.

“We are seeing more people step up and lobby bids in this situation,” he said. “We’re seeing more players mostly as a result of being attracted to the sector. I’m not so sure that will continue now that the rules have been ratchet it up.”

Meanwhile, much of the commercial realty problem resides in the regional and small community banks, said Kanas, because larger banks haven’t fueled that sector in the past.

“The market is expecting about the way we were expecting,” he said. “Unfortunately, we’re not seeing any evidence of a recovery in the real estate market in the southern Florida market,” he said.

It’s rather interesting that there’s a strong argument that Obama’s regulations are actually hurting our recovery, but Obama doesn’t have to worry about that message getting out to the public.  His secret, clearly,  is completely safe with the mainstream media.

The FDIC – the government entity which is supposed to step in if a bank goes bankrupt – is itself on the verge of going bankrupt:

March 4 (Bloomberg) — Federal Deposit Insurance Corp. Chairman Sheila Bair said the fund it uses to protect customer deposits at U.S. banks could dry up amid a surge in bank failures, as she responded to an industry outcry against new fees approved by the agency.

And think about it: one thousand banks failing over the next two years is to the notion of “economic recovery” what a giant asteroid hurtling toward us from space is to the statement “things are looking up for us.”  But again, the mainstream media is so focused on talking up the economy that they don’t have much time for such distractions.

What’s going to happen to unemployment?  The media made such a big deal about a temporary 1/10th of one percent drop in the unemployment rate.  But the longer term trend isn’t good.  It isn’t good at ALL:

Banks Stronger But Outlook Clouded by Job Loss: Whitney

Unemployment is likely to rise to 13 percent or higher and will weigh on the economy for several years, countering government efforts to stabilize the banking industry, analyst Meredith Whitney told CNBC.

While Whitney raised her short-term outlook for banks, causing stocks to open in positive territory after pointing lower earlier, she said the long-term outlook for the economy remains murky.

Consumers will not be able to spend as they continue to lose jobs and credit conditions stay tight, she said in a live interview. The result will provide a vivid display of how critical housing and lending are to economic growth. Unemployment is currently at 9.5 percent but is expected to keep rising.

We underestimate how much the whole economy is dependent on the mortgage industry, and that has to change,” Whitney said. “This is what happens when you delay the inevitable. We’re buying time here, but we’re not restructuring the economy.”

We’re looking a situation in which nearly half of American homes will be “underwater” – with the mortgages being higher than then homes are worth – by 2011.

And Obama’s policies are not helping to actually deal with the core problem facing the mortgage industry.

The dire assessment comes amid a slight stabilization in the U.S. housing market after three years of price drops, according to the National Association of Realtors.

The report states that the drop in home prices is fueling a vicious cycle of foreclosures as it eliminates homeowner equity and gives borrowers an incentive to walk away from their mortgage.

But, the foreclosed homes are not coming onto the market because people are finding out they can stay living in them and not pay their mortgage, according to Kudrle.

“The Obama administration is putting so much pressure on the banks and lenders to slow down the foreclosure process to try and keep people in their homes,” Kudrle said. “We have people who have not made a payment for 12 to 18 months and the bank still hasn’t come in to foreclose.”

That’s not a policy that is going to correct our financial woes; it’s just a delaying tactic that will ultimately make a bad problem far, far worse by postponing and in fact stockpiling the coming misery.

Government Supported Enterprises (GSEs) Fannie Mae and Freddie Mac – created by a Democrat-congrolled Congress and long run by connected Democrats – have been at the epicenter of the mortgage meltdown fiasco.

Peter Wallison predicted a future Fannie Mae and Freddie Mac failure in 1999 in a New York Times article, saying of Fannie Mae’s enormous financial exposure and risky policies:

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.” . . .

Franklin Raines, Jamie Gorelick, Jim Johnson, Daniel Mudd.  That’s just part of your list of Democrats who ran Fannie Mae into the ground and profited wildly in doing so.  The Wall Street Journal cites the first three names for disgrace in the Fannie Mae Enron-scheme they produced.  The fourth figure, Fannie CEO Daniel Mudd, showed just how far to the left Fannie Mae was politically when he said to THE most radically liberal wing of the Democrat Party – the Congressional Black Caucus - the following:

So many of you have been good friends to Fannie Mae and our mission. You’ve been friends through thick and thin. We have indeed come upon a difficult time for Fannie Mae…  In many ways I want to tell you today you are also the conscience of Fannie Mae.

President Bush tried SEVENTEEN TIMES to create tighter regulation of the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.

Bush’s efforts led to two major Republican efforts to push through regulations that would have limited the mess that Fannie and Freddie could create, but their every move was fiercely resisted by Democrats.  The first time, Barney Frank – leading the Democratic effort to shield Fannie and Freddie from necessary regulatory reform in 2003, said:

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Again, in 2005, Republicans tried and failed to establish necessary regulatory reforms of Fannie Mae and Freddie Mac at a time when reforms could have averted the 2008 disaster.  Again Democrats unanimously rose up to block any such effort.  John McCain warned:

If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.

But Democrats refused to heed the warnings.  And when the economy DID collapse BECAUSE of their refusal to deal with the GSEs that they had politically-benefited from, the very people who created the disaster in the first place poised themselves to benefit from it by demagoguing Republicans whose greatest sin was not being strong enough in their efforts to stand up and stop Democrats from advancing a ruinous agenda.

Think about it: seventeen calls for regulatory reform of the housing mortgage industry, all resisted by Democrats.  Two major efforts at regulatory reform, both blocked by fierce and united Democrat opposition.  And then Democrats demonized Republicans for refusing to enact regulations.  That’s called ‘chutzpah.’  And when the mainline media reported it as if it were somehow true, it was called ‘propaganda.’

In only a couple short years in the Senate, Barack Obama racked up the 2nd highest total in campaign contributions from Fannie Mae and Freddie Mac (2nd only to fellow Democrat and Senate Finance Chairman Chris Dodd).  Barack Obama was second in receipts of campaign contributions from corrupt Wall Street leveraging companies such as Lehman Brothers behind only Hillary Clinton.  Lehman Brothers profited and profited by playing the insane Wall Street insiders game until it went belly up from its own bloated practices.  And somehow that parasitic leech of a company was under the impression that financing one Barack Hussein Obama’s political career would be good for it’s greedy special interests.

And now we’re in such good hands to fix the mess that Democrats almost exclusively created.

And hey, don’t worry.  If anything bad happens, you can count on the mainstream media to honestly and objectively keep you informed — NOT.

Obama In The ‘We Don’t Mind ‘Cause You Don’t Matter’ Sub-50% Polling Range

July 25, 2009

One of the most readily understandable political calculus equations is the presidential poll: as long as a president is above 50% in the polls, he continues to hold a majority; but if he falls below 50%, he becomes increasingly irrelevant.  The nation is no longer behind him.  The lower he gets under 50, the more irrelevant he becomes.

Six months into the Obama presidency, Americans are already starting to say, “You see, Barry, it’s all a question of mind over matter.  We no longer mind because you no longer matter.”

For what it’s worth, the first time President Bush dipped below 50% according to Rasmussen was February 2004.  So Barry has to have set some kind of record for “sucking speed.”

Democrats and liberals feasted on George Bush like a herd of swine feasting on a trough full of carrots.  And in the case of the Barack Obama presidency, suppertime is coming very, very early.

Daily Presidential Tracking Poll

Friday, July 24, 2009

The Rasmussen Reports daily Presidential Tracking Poll for Friday shows that 30% of the nation’s voters now Strongly Approve of the way that Barack Obama is performing his role as President. Thirty-eight percent (38%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -8 (see trends).

Just 25% believe that the economic stimulus package has helped the economy.

The Presidential Approval Index is calculated by subtracting the number who Strongly Disapprove from the number who Strongly Approve. It is updated daily at 9:30 a.m. Eastern (sign up for free daily e-mail update). Updates also available on Twitter.

Overall, 49% of voters say they at least somewhat approve of the President’s performance. Today marks the first time his overall approval rating has ever fallen below 50% among Likely Voters nationwide. Fifty-one percent (51%) disapprove.

Eighty-three percent (83%) of Democrats continue to approve of the President’s performance while 80% of Republicans disapprove. Among those not affiliated with either major party, 37% offer a positive assessment. The President earns approval from 51% of women and 47% of men.

These updates are based upon nightly telephone interviews and reported on a three-day rolling average basis. Most of the interviews for today’s update were completed before the President’s nationally televised press conference on Wednesday night. The first update based entirely upon interviews conducted after the press conference will be released on Sunday.

Zogby has Barry Hussein at 48%.

Now, the last paragraph of the article becomes interesting because this means the poll does not take into account Obama’s truly suck performance at his July 22 press conference or the subsequent flap over his racially biased and frankly incredibly stupid comment about the Cambridge police “acting stupidly” in arresting an emotionally out-of-control African-American Studies professor.

So the easy money is betting that Sunday we’re going to see Obama down even more.  And then more.

Hot Air has a couple of insightful paragraphs describing the poll’s nuances on just why Obama is starting to poll as badly as he is:

It marks the first time that Obama has gone underwater since he started his remarkable run for the presidency in early 2007.  Undoubtedly, voters have now put the responsibility for the economy squarely on Obama’s shoulders after six months of worsening indicators.  The steep decline in support for his health-care bill represents in part a lack of confidence in his ability to deliver after the failure of the massive stimulus package, which he promised would put America back to work.

Even the Democratic gender gap has mostly been wiped out for Obama.  Although crosstabs are not available on daily tracking reports, Rasmussen’s poll shows an approval rating of 51% among women, just two points above the overall average.  If Obama had hoped to maintain the traditional Democratic inroads with women with his focus on health care, that appears to have backfired, as the survey on that issue earlier in the week showed women opposing it by a 50%-46% edge, with men more clearly in opposition at 53%-44%.  Why? Pluralities among both genders believe that their personal coverage will get worse under ObamaCare.

Unemployment is at 9.5% – and is expected to rise to 10% and beyond by the end of the year.  That sure isn’t going to help Obama become “Mr. Popular.”  And if that isn’t bad enough for him – and for the country he’s misleading – a new employment forecast by Obama’s own Federal Reserve foresees high unemployment numbers for at least the next five years.

But wait, as they say: there’s more.  Respected Wall Street analyst Meredith Whitney predicts that unemployment will rise to 13% or higher.  She’s the analyst with the nickname, “The woman who called Wall Street’s meltdown,” so right now I’m giving her more credibility than Obama’s people who said that if their stimulus passed unemployment wouldn’t rise above 8%.

And there’s yet even more.  We don’t calculate unemployment the way we used to.  We used to calculate unemployment based on the number of people who would like to have a full time job but don’t have one.  Bill Clinton changed the way unemployment was tabulated.  But if this were in the 1980s, we would be reading about 16.5% unemployment.  And if THAT number doesn’t frighten you enough, how about the possibility of 20% by the end of the year?

Remember all the talk about Barack Obama being compared to FDR?

Time_Obama-cover

Now we’ll get to celebrate Obama-as-FDR right – with Great Depression levels of unemployment, which will likely lead us into another Great Depression.  The first FDR didn’t fare so well with the first Great Depression; and I think the second FDR will do an even lousier job.

It will be fun watching Barry “ride the slide” to political hell.

It won’t be so much fun watching the Late Great U.S.A. sliding into economic hell right along with him.

Taxpayers Now On Hook For $23.7 TRILLION In Bailout Money

July 22, 2009

I don’t know if I should be more scared than angry or more angry than scared.  Suffice it to say, I’m both angry and scared as hell.

The Obama presidency is just one giant nightmare.  And just like most nightmares, it’s going to keep getting scarier and scarier and crazier and crazier the longer it goes on.

While Obama has promised us unparalleled transparency, we have had the truth concealed from us, and we have been lied to.  And the TARP Inspector General’s report should wake up every American and

U.S. Rescue May Reach $23.7 Trillion, Barofsky Says (Update3)

By Dawn Kopecki and Catherine Dodge

July 20 (Bloomberg) — U.S. taxpayers may be on the hook for as much as $23.7 trillion to bolster the economy and bail out financial companies, said Neil Barofsky, special inspector general for the Treasury’s Troubled Asset Relief Program.

The Treasury’s $700 billion bank-investment program represents a fraction of all federal support to resuscitate the U.S. financial system, including $6.8 trillion in aid offered by the Federal Reserve, Barofsky said in a report released today.

“TARP has evolved into a program of unprecedented scope, scale and complexity,” Barofsky said in testimony prepared for a hearing tomorrow before the House Committee on Oversight and Government Reform.

Treasury spokesman Andrew Williams said the U.S. has spent less than $2 trillion so far and that Barofsky’s estimates are flawed because they don’t take into account assets that back those programs or fees charged to recoup some costs shouldered by taxpayers.

“These estimates of potential exposures do not provide a useful framework for evaluating the potential cost of these programs,” Williams said. “This estimate includes programs at their hypothetical maximum size, and it was never likely that the programs would be maxed out at the same time.”

Barofsky’s estimates include $2.3 trillion in programs offered by the Federal Deposit Insurance Corp., $7.4 trillion in TARP and other aid from the Treasury and $7.2 trillion in federal money for Fannie Mae, Freddie Mac, credit unions, Veterans Affairs and other federal programs.

Treasury’s Comment

Williams said the programs include escalating fee structures designed to make them “increasingly unattractive as financial markets normalize.” Dependence on these federal programs has begun to decline, as shown by $70 billion in TARP capital investments that has already been repaid, Williams said.

Barofsky offered criticism in a separate quarterly report of Treasury’s implementation of TARP, saying the department has “repeatedly failed to adopt recommendations” needed to provide transparency and fulfill the administration’s goal to implement TARP “with the highest degree of accountability.”

As a result, taxpayers don’t know how TARP recipients are using the money or the value of the investments, he said in the report.

‘Falling Short’

“This administration promised an ‘unprecedented level’ of accountability and oversight, but as this report reveals, they are falling far short of that promise,” Representative Darrell Issa of California, the top Republican on the oversight committee, said in a statement. “The American people deserve to know how their tax dollars are being spent.”

The Treasury has spent $441 billion of TARP funds so far and has allocated $202.1 billion more for other spending, according to Barofsky. In the nine months since Congress authorized TARP, Treasury has created 12 programs involving funds that may reach almost $3 trillion, he said.

Treasury Secretary Timothy Geithner should press banks for more information on how they use the more than $200 billion the government has pumped into U.S. financial institutions, Barofsky said in a separate report.

The inspector general surveyed 360 banks that have received TARP capital, including Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. The responses, which the inspector general said it didn’t verify independently, showed that 83 percent of banks used TARP money for lending, while 43 percent used funds to add to their capital cushion and 31 percent made new investments.

Barofsky said the TARP inspector general’s office has 35 ongoing criminal and civil investigations that include suspected accounting, securities and mortgage fraud; insider trading; and tax investigations related to the abuse of TARP programs.

We were sold the stimulus (more commonly known to people who actually knew what was going on as ‘porkulus,’ and more accurately known as the Generational Theft Act) as a $787 billion package.  But it was actually no such thing.  The media kept talking about billions; but the actual figure was $3.27 TRILLION.  That’s right.  $3.27 trillion.  We were lied to.  Costs that were clearly part of the legislation weren’t disclosed to us, and now on top of getting far less than what was advertised, we are paying far more for the privilege than was advertised.

Now we find out that Obama and his gang of thieves has done much the same with TARP.  Somehow, while we weren’t looking, “TARP evolved into a program of unprecedented scope, scale and complexity.”  And by the same people who promised us an “‘unprecedented level’ of accountability and oversight.”  And lo and behold, TARP has exploded under all the darkness into a mushroom cloud of government obligations that dwarf anything imaginable.

And all that’s coming out of the Obama administration is some stumbling excuse from the Treasury Department’s spin doctor that it really isn’t as bad as the inspector general scrutinizing TARP says it is.

What we are getting from the Obama administration is an unceasing projection of rosey-colored scenarios that have no connection whatsoever to reality.  When they are forced to offer some sort of excuse, they claim they didn’t realize the economy was so weak (even when they were fearmongering it into comparisons of the Great Depression to sell their stimulus package) – and then they immediately offer up yet another mindlessly and freakishly rosy scenario in their very next breaths!!!  And then, of course, based on these projections, they are racking up insane spending atop insane spending.

Wall Street analyst Meredith Whitney, who gained a reputation of credibility after boldly predicting doom when everyone around her was seeing roses last year, is now predicting 13% unemployment and a very tough future for banks due to the continuing mortgage meltdown.

The White House is refusing to release its own annual midsummer US budget update because it doesn’t want the American people to see how bad things are until after they’ve passed their massive health care boondoggle.  Many now believe that budget release accounts for Obama’s frenzied push to pass health care before the August recessHow’s THAT for “unparalleled transparency”?

As said, Meredith Whitney is predicting 13% or higher unemployment.  What you may not know is that we are already at Great Depression levels of unemployment right now, and that our current 9.5% unemployment rate would be nearing 20% if it were calculated the way it was in 1980.

Unemployment

Note: The SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated “discouraged workers” defined away during the Clinton Administration added to the existing BLS estimates of level U-6 unemployment.

We face a future damned-if-you-do, damned-if-you-don’t dilemma: the only reason interest rates aren’t shooting skyward is because the market is in such a doldrum.  But the moment recovery begins to rear its head in Barack Obama’s game of economic Whack-a-Mole (where he whacks down small businesses and private-sector employment), hyperinflation due to our massive indebtedness will likely attack us.  The prospect of a jobless recovery, followed by Zimbabwe-levels of inflation looms very large in our future.

We’ve set ourselves up for hyperinflation.  We have massively increased our money supply even as our GDP has plummeted.  We have an increasing lack of confidence on the part of investors that we will be able to maintain the value of our currency (and see here), forcing demand for higher and higher interest rate payments on future bonds.  Those were the conditions of the Wiemar Republic; those were the conditions of Zimbabwe; and those are the conditions in the Late Great USA.

Pretty soon, we will be facing the Sophie’s Choice prospect of whether we want massively high interest rates, or massively high inflation – or best of both worlds – both massive interest AND hyperinflation.  We’ve got experts such as Johns Hopkins Professor of applied economics Steve Hanke and National Bureau of Economic Research economist Anna Schwartz seeing the inflation bogeyman rearing its genuinely ugly head.  And we’ve got investors beginning to start betting big on a coming hyperinflationary economy.

The thing is, we have a giant mega-trillion ton anvil cued over our collective heads.  And it is just waiting to drop.

So you see massive debt exposure to US economic structures.  You see higher unemployment.  You see historically low levels of tax revenue.  You see terrible recent mortgage default rates now turning “markedly worse.” You see all kinds of indicators that our debts are getting larger and larger even as our ability to repay them becomes smaller and smaller.

And it is with that backdrop that we should contemplate the massive, mind-numbingly enormous numbers hanging over everything this administration has done, is doing, or is trying to do.  With the debt he’s accumulating going up by the trillions, Obama issued the petty promise to cut his spending by a measly $100 million.  And he couldn’t even fulfill that insignificant budget cut.  All he knows how to do is spend and spend and spend.

So get scared.  Get angry.  And get ready for the beast.

We voted for “No, no, no.  Not God bless America.  God damn America!”  And now we’re going to get to see what “God damn America” looks like.

Respected Analyst Meredith Whitney Predicts Unemployment Of 13 Percent Or Higher

July 14, 2009

The Obama administration predicted that if Obama’s stimulus passed, unemployment would not go over 8%.  He blatantly fearmongered the economy down in order to get his pet stimulus passed.  Obama rushed his incredibly euphemistically-named American Recovery Act through Congress so fast that no one even got a chance to actually read it.

The idea, of course, is that Obama’s liberal solutions would stop the slide and make things get gradually better.  But unemployment – which was at 4.4% when Democrats took power over both the House and the Senate – was at 6.7% when Obama got elected and at 7.2% when Obama was pushing for his stimulus in January.  As the Associated Press puts it, “In January, President Barack Obama’s economic team predicted unemployment would rise no higher than 8 percent with the help of $787 billion in new government spending.”  Yet unemployment is now higher than what the Congressional Budget Office said it would reach if we didn’t pass a stimulus.

Talk about a massive failure.

Now unemployment is at 9.5%, and – according to respected analyst Meredith Whitney – it is expected to top 13% in the coming months.

Banks Stronger But Outlook Clouded by Job Loss: Whitney

Unemployment is likely to rise to 13 percent or higher and will weigh on the economy for several years, countering government efforts to stabilize the banking industry, analyst Meredith Whitney told CNBC.

While Whitney raised her short-term outlook for banks, causing stocks to open in positive territory after pointing lower earlier, she said the long-term outlook for the economy remains murky.

Consumers will not be able to spend as they continue to lose jobs and credit conditions stay tight, she said in a live interview. The result will provide a vivid display of how critical housing and lending are to economic growth. Unemployment is currently at 9.5 percent but is expected to keep rising.

We underestimate how much the whole economy is dependent on the mortgage industry, and that has to change,” Whitney said. “This is what happens when you delay the inevitable. We’re buying time here, but we’re not restructuring the economy.”

And she’s right.  All the trillions of dollars in debt Obama has imposed on the American people, and with all of those trillions, he has utterly failed to do anything to fix the fundamental issues that broke our economy in the first place.  In fact, he is now seeking to use the $700 billion in TARP money (which stands for ‘Troubled Asset Relief Program”) to hand out to certain small businesses.  But don’t forget that the program was implemented to buy distressed assets from financial institutions, and NOT to buy political patronage.

Obama’s $3.27 trillion stimulus didn’t do anything to address the mortgage industry’s fundamental crisis, his 9,000-pork-project-laden $410 billion omnibus bill didn’t do anything to address the mortgage industry’s fundamental crisis, and now he is planning to pillage the one source of funds that were designed to deal with the things that actually created the economic crisis.

Meredith Whitney is bullish on Goldman-Sachs because sich the giant institution “will benefit from being a key player in a ‘tsunami of debt issuance’ by governments as they try to fill gaps in underfunded budgets.”

The Wall Street Journal article continues:

However, Ms. Whitney said her bullish view of Goldman is rooted in her overall bearish outlook for the U.S. economy and other U.S. financial companies. During an interview on the financial network CNBC on Monday morning, she said the U.S. unemployment rate could reach 13% and remain elevated beyond 2010, and that most banks likely aren’t prepared for prolonged joblessness at that level. The U.S. unemployment rate reached 9.5% in June. She said that bank stocks will be good buys in the short-term due to a robust mortgage business, but that the longer-term outlook for most banks was grim.

The suspicious person would wonder over the fact that Obama – who took more campaign money from the financial institutions that played critical roles in bringing us the economic crisis in the first place – is now preparing to massively reward those very same institutions.

But let’s forget about that, and focus on the far more terrifying news than mere Chicago-style political corruption.

Let us focus on the fact that, contrary to Obama’s bold assertions, things are not looking up.  They are in fact looking down.  And increasingly, it appears that things are going right down the toilet.

Now, given those two basic facts – Obama’s early prediction that his stimulus would hold unemployment to under 8%, and Meredith Whitney’s forecast of coming 13% or higher unemployment - what do you make of Obama’s statement:

Yet the stimulus package “is working exactly as we had anticipated,’’ Obama told CNN. “We always anticipated that a big chunk of that money then would be spent not only in the second half of the year, but also next year. This was designed to be a two-year plan and not a six-month plan,’’ he said.

How can this sound like anything other than the most transparent lie?  And the lie of a man who has absolutely no idea what he’s doing at that.  How can he so blithely pass over his total documented failure to manage the economy as he said he could?  How can he so blithely pass over the coming black hole of unemployment that is just going to get worse and worse?

Our president is a fool who has been by far the most successful when he has counted on the foolishness of the American people.

Vice President Joe Biden recently said, “The truth is, we and everyone else misread the economy.”  But that is not true at all.  For one thing, it wasn’t “everyone” who issued the completely contradictory statements that 1) predicted that unemployment wouldn’t rise above 8% if we passed the stimulus; 2) said we misread the economy; and 3) said the stimulus package is performing exactly as anticipated.  Only the Obama administration was so completely wrong, and so completely incoherent.

I’m no great economist, but I’ve been regularly predicting that Obama would totally fail to handle the economic mess that Democrats largely created in the first place.  Republicans predicted that the stimulus would totally fail to create jobs even as it harmed our economy with stratospheric debt.  CEO’s have gone on record predicting that Obama would bankrupt the country within three years if his agenda was implemented.

The unemployment numbers are truly terrifying, particularly if you realize that – with discouraged workers factored in as they were during the Great Depression – we are already at Great Depression levels of unemployment.   For the record, the unemployment rate in 1930 was about where it is now.  And we were when the unemployment rate was a full percentage point lower than it is today.   Paul Craig Roberts, the assistant secretary of the Treasury under Reagan, said on January 12, 2009, “According to the methodology used in 1980, the US unemployment rate in December 2008 reached 17.5 percent.”  We’re going down the drain, and all our federal government can do is play games with economic statistics to make things appear less bad than they really are.  But what’s going to happen when it goes up yet another four percent from where it is now?  And based on what factors will we be able to stop it at that level?


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