Posts Tagged ‘GSEs’

The Obama Economy: Bovine Fecal Matter On Ice

July 2, 2015

Well, the good news is that the unemployment rate went down to a seven-year low for Obama to 5.3%  Surely Obama must be doing an awesome job, Democrats say.

Okay.  Obama’s BEST MONTH EVER statistic-wise matches the EIGHT-YEAR AVERAGE for the Bush presidency that Democrats say was terrible. Although, technically, Bush’s average unemployment rate of 5.27% is still BETTER than Obama’s best month EVER.

During the 8 years of the George W. Bush Presidency the lowest annual unemployment rate was 4.61% in 2007, the highest annual unemployment rate was 5.76% in 2008. During Bush’s 8 years as President the average unemployment rate  was 5.27%

Which is another way of saying that “Democrat” and “disgusting, dishonest, pathological hypocrite” may not rhyme, but they sure mean the same thing.

The mainstream media are pathological hypocrites, for sure.  You can take a trip down memory lane and compare how they compared unemployment numbers even when they were BETTER for the Republican presidents.

The bad news is that twice as many people just gave up looking for a job as actually GOT a job this month.

The bad news is that Obama set another record.  And not in any good sense:

Record 93,626,000 Americans Not in Labor Force; Participation Rate Declines to 62.6%
By Ali Meyer | July 2, 2015 | 8:42 AM EDT

(CNSNews.com) – A record 93,626,000 Americans 16 or older did not participate in the nation’s labor force in June, as the labor force participation rate dropped to 62.6 percent, a 38-year low, according to the Bureau of Labor Statistics.

In June, according to BLS, the nation’s civilian noninstitutional population, consisting of all people 16 or older who were not in the military or an institution, hit 250,663,000. Of those, 157,037,000 participated in the labor force by either holding a job or actively seeking one.

The 157,037,000 who participated in the labor force equaled only 62.6 percent of the 250,663,000 civilian noninstitutional population, the lowest labor force participation rate seen in 38 years. It hasn’t been this low since October 1977 when the participation rate was 62.4 percent.

Another 93,626,000 did not participate in the labor force. These Americans did not have a job and were not actively trying to find one.

Of the 157,037,000 who did participate in the labor force, 148,739,000 had a job, and 8,299,000 did not have a job were actively seeking one—making them the nation’s unemployed.

The 8,299,000 job seekers were 5.3 percent of the 157,037,000 actively participating in the labor force during the month. Thus, the unemployment rate was 5.3 percent which dropped from the 5.5 percent unemployment seen in May.

The number of employed Americans dropped from 148,795,000 in May to 148,739,000 in June, a decline of 56,000. The number of unemployed Americans also dropped over the month from 8,674,000 in May to 8,299,000 in June, a decline of 375,000.

The labor participation rate was 65.7 percent the day Barack Hussein Obama took office.

Labor Participation Rate thru June 2015

I like this article because it’s one of the first I’ve seen that actually gives you a notion of the statistical shenanigan that our “unemployment rate” truly is.  Nearly 94 million working-age people are unemployed, but our unemployment rate only considers 8 million of them.  I guess the other 86 million are silver-spoon trust-fund kids lounging around their mansions sipping champagne and dining on the finest caviar.  Either that or you’re an “abject imbecile” – another synonym for “Democrat” to go alongside “disgusting, dishonest, pathological hypocrite.”

As I’ve been trying to point out over and over again, Obama has been to the labor participation rate what stage 5 lung and bronchus cancer is to quality of life.  Obama has been absolutely devastating and toxic to American jobs.  And like the stage 5 lung and bronchus cancer sufferer, the patient that is the American economy is actually getting weaker and weaker measured in terms of the ALL-IMPORTANT measure of how many working-age Americans actually have a damn JOB.  The rate of Americans with a damn JOB – which for the factual record are LOWER PAYING JOBS with FEWER HOURS under Obama – has been sinking and sinking and sinking.  Thanks to the Obama presidency and the stage five cancer that is the Democrat Party, fewer and fewer Americans are working, while more and more of those fewer and fewer are working for less and cannot get decent full-time jobs.

And what is the Democrat strategy?  Well, further disincentivize employers by putting more and more burdens and obstacles on them.  You know, like treating that stage five lung and bronchus cancer patient with concentrated dosages of asbestos and then blaming the fact that the patient keeps getting sicker on Republicans.

I’ve listened to the smartest, smarmiest Democrats trying to explain why the labor participation rate is so shockingly low under Obama.  Here’s one example:

There are a few reasons why the LFPR has declined. First, the country is aging as baby boomers retire. An older country means a lower percent of the population will be in the labor force. This is a structural reason for the LFPR’s recent decline—it was going to happen regardless of the underlying economic conditions. That’s why many economists forecasted that the rate would slowly fall over time.

Here’s the problem, smart, smarmy Democrat: you’re exactly what the Bible foretold when it said, “Professing themselves to be wise, they became fools…”  Consider the FACTS that blow the Democrat theory right out of the water akin to the way that the reality of Japanese torpedoes blew up the U.S.S. Arizona in Pearl Harbor when Democrats also didn’t have a freaking clue what the hell was going on:

Last week, though, a study by the Federal Reserve Bank of St. Louis took on the notion that the drop is all about demographics and not a sign that the labor market is sicker than we think. The study looked at the labor force participation rate not just in the U.S. but in eight major developed countries, including Sweden, Japan, Canada, Germany, France, Spain, and the United Kingdom. Nearly all of those countries are facing the same demographic trends as the U.S. And Japan is currently dealing with an even more severe case of aging population. And yet, out of the eight nations, the U.S. is the only one where the participation in the labor force is declining.

So much for the Democrat theory that, well, shoot, you can’t blame Obama for the collapse in labor participation.  It was just selfish Republican white people retiring.  Because all the OTHER developed nations have the same demographic issues as America does -with Japan’s aging population FAR WORSE.  And yet somehow we’re doing worse than ANY of them in labor participation.

And for another factoid, it is striking that Democrats are trying to point at an aging demographic to explain our dismal labor participation rate:  BECAUSE THEY HAVE MURDERED SIXTY MILLION INNOCENT BABIES IN THEIR GOD DAMN ABORTION MILLS SINCE 1973 AND WHAT THE HELL DO YOU THINK THAT WOULD DO TO THE AVERAGE DAMN AGE OF OUR POPULATION???  It’s akin to the classic example of the child who murdered both his parents and then asked for mercy from the court on the grounds that he’s an orphan.  And so we can now document that that proverbial godawful kid is a DEMOCRAT through and through.

If you are a DEMOCRAT – which stands for DEMOn-possessed bureauCRAT – you are a liar without shame, honor, decency, virtue, or integrity of any kind whatsoever.  And one of the reasons you so worship government is that your love of lies most flourishes because the best way to lie of ALL is with STATISTICS.

The article includes a rather striking graph that shows America DEAD LAST among the top developed nations but I keep looking at it:

What I particularly noticed as I stared in horror at this graph of the demise of my country was the fact that Bush was actually bringing the baby up between 2005 and the middle part of 2008.  I checked the Department of Labor chart and the actual numbers back up the graph: the labor participation rate was actually going UP.  Clinton left office just before a TERRIBLE RECESSION PLUS THE DOUBLE-WHAMMY OF THE 9/11 ATTACK struck America as a result of Clinton’s leaving America weak and blind in the face of our enemies.  That recession was called the DotCom Bubble collapse.

Here’s an example of how I’ve pointed out these stubborn things called FACTS in the past:

Clinton’s DotCom crash resulted in $7.1 trillion in American wealth being vaporized:

The Market Capitalization of the Dow Jones Wilshire 5000 Full Cap was $16.7 Trillion as of April 30, 2008. Comparatively, the market cap at the end of Q1 in 2000 was approximately $16 trillion (only slightly smaller). However, between 2000 Q1 and Q1 2003 the index lost a stunning 43% of its valuation. In other words, $7.1 Trillion of wealth was lost. This stunning number includes the completeness of the crash.

Who was still president in the first quarter of the fiscal year 2000 when this disaster began to blow up?  It was the guy who was still president on January 20, 2001 when George Bush assumed – and dare I say “inherited” – the office of the president.

Here’s another number to think about: 78%.  Because “The Nasdaq Composite lost  78% of its value as it fell from 5046.86 to 1114.11” as it collapsed between March 11, 2000 to October 9, 2002.

Obviously, there was a problem. The first shots through this bubble came from  the companies themselves: many reported huge losses and some folded outright  within months of their offering. Siliconaires were moving out of $4 million  estates and back to the room above their parents’ garage. In the year 1999,  there were 457 IPOs, most of which were internet and technology related. Of  those 457 IPOs, 117 doubled in price on the first day of trading. In  2001 the number of IPOs dwindled to 76, and none of them doubled on the first  day of trading.

I want to know why Bush is still responsible for Obama’s entire economic mess four years later when Bill Clinton was never held responsible for so much as one second of Bush’s mess.  I want to understand why Democrats are lying, dishonest, hypocrite slime whose only talent is bankrupting America and then demagoguing Republicans for what they did.

You find out that the Dotcom bubble began to grow huge in 1995 and virtually all of Clinton’s economic “success” that didn’t have to do with the policies of the Republican House and the Republican Senate that swept into power in 1995 as a result of the historic 1994 asskicking as a result of Clinton’s and the Democrat Party’s abject failure had to do with the inflation of that damn bubble.  Clinton fanned the flames of that Dotcom bubble because he knew that it would explode on the next president’s watch and that Democrats were far too personally and pathologically dishonest to ever blame HIM for it.

And yet Bill Clinton saunters before the 2012 Democrat National Convention and gives a speech saying “You can’t blame Obama for this disaster of an economy.  Why, even I couldn’t have fixed it.”  And the liberal media listen to their former messiah absolve their current messiah and ignore the fact that Bill Clinton is a serial liar who was DISBARRED by the Supreme Court for LYING as well as a serial womanizing sexual predator who sexually abused five women and they said, “Well, that settles it.  NO one can blame ‘the One’ now; the former ‘One’ has spoken.”  And the “War on Women” party cheers.

I’ve been pointing this out over and over again recently: if you are a Democrat, you are a LIAR at home with LIES.  You are a BAD PERSON.  You have one middle finger stuck up in the air at the God of the Bible you rabidly despise and the other middle finger shoved up your rectum because you are a DEPRAVED PERVERT.

The above quote is about how Bill Clinton led America straight into the vicious  gut-punch of a giant recession that the pathologically dishonest propaganda mill that is the mainstream media refused to credit him with even though there is no question that the economy was clearly going into recession as Bill Clinton was still in office which then exploded under George Bush.  But we’ve also got to consider the knockout-punch to the head that was the 9/11 attack as a result of Bill Clinton leaving America both weak and blind and with a reputation for withdrawing from conflict.  You know, just as Barack Obama has now done to America.  Obama isn’t just the first president since Kennedy to beg for spacecraft rides because he’s pissed away our space capability; he’s now actually having to beg for ships to deploy our Marines!!!  In a time when our enemies are building up their militaries and becoming stronger, America under Obama is becoming weaker and weaker.  Which is why we’re getting bullied around – by Islamic State, by China, by Russia, by Iran, just to name a few enemies – like we have never been in my entire lifetime.

We are ripe for an attack by emboldened enemies.  And no nation has EVER deserved to be attacked more than this wretched Obamanation.

Another thing I noticed as I look at the above graph is that the liberal explanation that the labor participation rate was highest under Bill Clinton fails to consider a key fact (not including the fact that it was actually much higher under both Ronald Reagan and George H.W. Bush than it ever was under Bill Clinton): I notice that the labor participation rate PLUNGED under Bill Clinton for the first years of his presidency when he was playing the role of liberal president with a Democrat Congress.  But then in 1994 Clinton had his ass handed to him by the American people who put REPUBLICANS in charge of both the House and the Senate.  And Bill Clinton ultimately uttered the famous words, “The era of big government is OVER.”  And it was under the REPUBLICAN policies OF reducing the giant jackboot of federal government power that the economy managed something of a rebound.  At least until the DotCom bubble and the 9/11 attack both of which Bill Clinton was solely responsible for, which forced George Bush to build it up all over again.

I’ve patiently explained why the economy collapsed under the Bush presidencyIt was the Democrat-constructed housing bubble enacted by the Democrat-created Fannie Mae and Freddie Mac (otherwise known as GSEs, which is the acronym for the blatantly leftist fascistic crony capitalist monstrosity of Government Sponsored Enterprises).  I end the second of the above articles I link to with this:

What did Democrats do with the mainstream media’s culpability?  They falsely dropped the crisis at the feet of “greedy” Wall Street.  But while examples of Wall Street greed abound, the liberal intelligentsia deliberately overlooked the central and preceding role of Democrat-dominated Fannie Mae and Freddie Mac.

Here’s how the mess actually happened:

The New York Times acknowledged that Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac “buy mortgages from lenders and repackage them as securities or hold them in their own portfolios.”

And the Los Angeles Times on May 31, 1999 describes how this process turned into a bubble, as more begat more, and then more and more begat more and more and more:

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. . . .

In a nutshell, Fannie and Freddie, in their role as Government Sponsored Enterprises, bought tens of millions of mortgages, and then repackaged them into huge mortgage-backed securities that giant private entities such as Bear Stearns, AIG and Lehman Brothers purchased.  What made these securities particularly attractive to the private banking entities was that these securities were essentially being sold – and had the backing – of the United States government.  Fannie Mae and Freddie Mac, again, are Government Sponsored Enterprises.

Here’s the process:

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.

Now, any intelligent observer should note a primary conflict that amounts to a fundamental hypocritical contradiction: the GSE’s role was to “provide stability,” and yet at the same time they were taking on “significantly more risk” in the final year of the Clinton presidency.  What’s wrong with this picture?

The GSEs Fannie Mae and Freddie Mac were designed to bundle up the mortgages into mortgage backed securities and then sell them to the private market.

Fannie Mae is exempt from SEC [Securities and Exchange Commission] regulation. Which screams why Bush wanted to regulate them.  This allowed Fannie Mae to bundle up mortgages, which were then rated AAA with no requirement to make clear what is in the bundle.  Which screams why Bush wanted to regulate them.

This is what allowed the toxic instruments that have been sold across the world to proliferate.  And then to explode.  It also created a situation where money institutions did not know and could not find out whether potential inter-bank business partners were holding these “boiled babies on their books, complete with a golden stamp on the wrapping,” rather than safe instruments.  This then inclined banks to a natural caution, to be wary of lending good money to other banks against these ‘assets’.  And thus banks refused to lend to one another.

And it was Democrats, not Bush, and not Republicans, who were all over this disaster that destroyed our economy in 2008.

We were led by a pathologically dishonest media to believe that Republicans had created this mess, when it fact it had been Democrats.  And so we gave the very fools who destroyed our economy total power.

Anybody who wants to see “right wing Republican policies” in that 2008 collapse is what I call an idiot.  Democrats under Jimmy Carter enacted the Community Reinvestment Act – which insanely and immorally forced banks to make loans to poor minorities who couldn’t afford to actually pay for them – that was expanded under Bill Clinton at the tail end of his presidency; and Democrats then used the expanded GSEs to pound the crack in the economic wall that the CRA fiasco created wide open.  George W. Bush tried SEVENTEEN TIMES to install sane regulations to control Fannie and Freddie, but Democrats rabidly refused to allow ANY controls for their out-of-control GSEs.  These are just FACTS.  Bush’s failure was that he shrugged his shoulders while Democrats planted a giant bomb in our economic engine; George Bush’s failure was that he failed to hunt every single Democrat down with dogs and burn them alive.

The fact of the matter is that when Clinton governed left, the economy floundered and was failing.  The American people went right, elected a rightwing Congress, and Clinton went with them for the greater part. Things that Bill Clinton gives himself sole credit for were actually platforms from the Republican Contract with America.  Now we’ve got this demonstrably false myth that Clinton was a liberal who governed as a liberal and that is why the economy flourished.

I’ve got to end somewhere, although I can literally go on all day.  Because the actual facts prove that Democrats are basically the cause of everything that is evil or ruinous in America.  So let me just end with something that George Will said a few weeks ago (when the labor participation rate merely matched the horror of 1978 rather than beat it for being even WORSE as it just did):

CHRIS WALLACE, FOX NEWS SUNDAY: We could continue this conversation and I’m sure we will, but let’s turn to the economy and some really disappointing numbers on the economy this week. Here they are. Only 126,000 jobs were added in March. That’s the weakest hiring in 15 months. Labor force participation dropped to 62.7 percent, matching the lowest since 1978. And the Federal Reserve Bank in Atlanta estimates first quarter growth at zero, zero percent, flat. George, what’s going on here?

GEORGE WILL, SYNDICATED COLUMNIST: Well, for the second year in a row they’ve blamed poor quarterly growth on insufficient global warming, that is on winter, on an unusually cold winter. Let your mind go back to November last year. There was job creation of 321,000 jobs and the administration said this is a miraculous achievement and a harbinger of things to come. It wasn’t a harbinger and it wasn’t miraculous. During the Reagan recovery there were 23 months of job creation over 300,000. Reagan had a month of job creation of 1 million and this was at a time when there were 75 million fewer Americans. Now, never mind zero growth. We are now being told really that two percent growth may be the new normal. If so, that’s a disaster because every day, today, yesterday, tomorrow, every day between now and 2030, 10,000 more baby boomers become eligible for Social Security and Medicare. If we have two percent growth, the crisis of the welfare state, the crisis of the private sector being able to throw off the revenues, to pay the bills for the promises we’ve made to ourselves becomes impossible.

WALLACE: Just tell again that the labor force participation stat that you have, if it were what it was at the beginning of the Obama administration.

WILL: If the workforce participation rate today were as high as it was on the day Barack Obama was inaugurated, the unemployment rate in this country would be 9.7 percent, we wouldn’t be complaining about the bad recovery because we wouldn’t call it a recovery.

It takes the Holy Bible to explain the sheer idiocy that is a Democrat voter:

Woe to those who call evil good and good evil; who substitute darkness for light and light for darkness, who substitute bitter for sweet and sweet for bitter. — Isaiah 5:20

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Fascist Criminal Thug-In-Chief Obama Turns On Citigroup (But If Citigroup Did Something Wrong, Why Is Jack Lew Who Ran Citi Unit Not In JAIL?)

July 17, 2014

According to lawthug Eric Holder, Citigroup is a reckless criminal enterprise that ruthlessly preyed on helpless little people to such a whopping extent that it required a $7 billion settlement to balance the scales of justice.

This fits into the narrative that clearly the government was not at fault in our financial meltdown (well, except Bush and the Bush administration, which are Republican and therefore can be blamed for everything that goes wrong).  Government is inherently and intrinsically good as long as Obama is running it rather than a Republican president, you see.  And so we can’t blame the Community Reinvestment Act – which forced lending institutions to make loans to people any fool knew would not be able to make their payments.  Even though it clearly led to a six-plus TRILLION dollar balloon that HAD to burst as Democrats used the CRA as a means to reward their supporters at the skyrocketing cost of everyone else:

And which Republicans very clearly WARNED would burst:

Nope. It’s Bush’s fault, no matter how much to blame Democrats clearly WERE.

We can’t blame Barack Obama for his own particularly egregious role in those forced loans to high-risk individuals.  We can’t blame Democrats for forcing “adherence to that act [which] led to riskier lending by banks.”  We can’t blame Fannie Mae and Freddie Mac – which came up with the incredibly risky strategy as I document in quite a few articles such as this one:

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 George 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 shortly after Barney Frank testified that they were “fundamentally sound,” 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.

Three top Democrats, Franklin Raines, Jim Johnson and Jamie Gorelick “fundamentally transformed” Fannie Mae into a liberal Democrat exploitation machine and made MILLIONS in illegitimate bonuses cooking the books.

I could go on and on.  But one thing is crystal clear to anyone who wants to know the truth and who isn’t demon-possessed: Democrats forced banks to do something incredibly stupid, and banks did the very best they could to operate in a Kafkaesque system that Democrats created and cynically exploited and Bush tried seventeen times to stop.

I mock you Democrats now, because every single ONE of you is a future permanent resident of the fire of hell.  You demonize Republicans as “obstructionists” and “terrorists” for preventing Obama and Democrats from running roughshod over America.  But when Bush was president you OBSTRUCTED him at virtually every damn turn.  You fascist hypocrites without shame.

Let me get back to Jack Lew and our Fascist-in-Chief Obama.

Citigroup gets this massive fine.  They were criminals, Obama and Holder say.

So why is the man who ran the unit that performed all the criminal actions our Treasury Secretary???

That’s the question the Wall Street Journal is asking:

The Citigroup ATM
Jack Lew and Tim Geithner escape mention in the bank settlement.
The Wall Street Journal, July 14, 2014 7:37 p.m. ET

The Department of Justice isn’t known for a sense of humor. But on Monday it announced a civil settlement with Citigroup over failed mortgage investments that covers almost exactly the period when current Treasury Secretary Jack Lew oversaw divisions at Citi that presided over failed mortgage investments. Now, that’s funny.

Though Justice, five states and the FDIC are prying $7 billion from the bank for allegedly misleading investors, there’s no mention in the settlement of clawing back even a nickel of Mr. Lew’s compensation. We also see no sanction for former Treasury Secretary Timothy Geithner, who allowed Citi to build colossal mortgage risks outside its balance sheet while overseeing the bank as president of the New York Federal Reserve.

The settlement says Citi’s alleged misdeeds began in 2006, the year Mr. Lew joined the bank, and the agreement covers conduct “prior to January 1, 2009.” That was shortly before Mr. Lew left to work for President Obama and two weeks before Mr. Lew received $944,518 from Citi in “salary, payout for vested restricted stock,” and “discretionary cash compensation for work performed in 2008,” according to a 2010 federal disclosure report. That was also the year Citi began receiving taxpayer bailouts of $45 billion in cash, plus hundreds of billions more in taxpayer guarantees.

While Attorney General Eric Holder is forgiving toward his Obama cabinet colleagues, he seems to believe that some housing transactions can never be forgiven. The $7 billion settlement includes the same collateralized debt obligation for which the bank already agreed to pay $285 million in a settlement with the Securities and Exchange Commission. The Justice settlement also includes a long list of potential charges not covered by the agreement, so prosecutors can continue to raid the Citi ATM.

Citi offers in return what looks like a blanket agreement not to sue the government over any aspect of the case, and waives its right to defend itself “based in whole or in part on a contention that, under the Double Jeopardy Clause in the Fifth Amendment of the Constitution, or under the Excessive Fines Clause in the Eighth Amendment of the Constitution, this Agreement bars a remedy sought in such criminal prosecution or administrative action.” We hold no brief for Citi, which has been rescued three times by the feds. But what kind of government demands the right to exact repeated punishments for the same offense?

The bank’s real punishment should have been failure, as former FDIC Chairman Sheila Bair and we argued at the time. Instead, the regulators kept Citi alive with taxpayer money far beyond what it provided most other banks as part of the Troubled Asset Relief Program. Keeping it alive means they can now use Citi as a political target when it’s convenient to claim they’re tough on banks.

And speaking of that $7 billion, good luck finding a justification for it in the settlement agreement. The number seems to have been pulled out of thin air since it’s unrelated to Citi’s mortgage-securities market share or any other metric we can see beyond having media impact.

If this sounds cynical, readers should consult the Justice Department’s own leaks to the press about how the Citi deal went down. Last month the feds were prepared to bring charges against the bank, but the necessities of public relations intervened.

According to the Journal, “News had leaked that afternoon, June 17, that the U.S. had captured Ahmed Abu Khatallah, a key suspect in the attacks on the American consulate in Benghazi in 2012. Justice Department officials didn’t want the announcement of the suit against Citigroup—and its accompanying litany of alleged misdeeds related to mortgage-backed securities—to be overshadowed by questions about the Benghazi suspect and U.S. policy on detainees. Citigroup, which didn’t want to raise its offer again and had been preparing to be sued, never again heard the threat of a suit.”

This week’s settlement includes $4 billion for the Treasury, roughly $500 million for the states and FDIC, and $2.5 billion for mortgage borrowers. That last category has become a fixture of recent government mortgage settlements, even though the premise of this case involves harm done to bond investors, not mortgage borrowers.

But the Obama Administration’s references to the needs of Benghazi PR remind us that it could be worse. At least Mr. Holder isn’t blaming the Geithner and Lew failures on a video.

We now live in a time when a fascist Hitler-style leader simply “invents” something he calls “justice.”  Whose to blame and who is absolved?  It’s no different than Stalin randomly signing death warrants for the execution of “criminals” whose “crime” was whatever the hell he happened to say it was.  All you have to do is substitute the word “tea party” for “kulak” to get the essence of Stalinist thug Obama.

Consider that Citigroup was SEVENTH on the donor list for the Obama campaign.  Oh, the top people – the Citi execs like Jack Lew who GAVE Obama that money that enabled him to forever afterward screw up our political system by being the first candidate to bypass the federal matching funds system so he could raise over a BILLION DOLLARS from the filthiest rich – got off the hook and got their huge bonuses for doing their dirty work for liberals.  Jack Lew was the chief operating officer of the Citigroup unit that profited from the loans that Obama is now saying are evil and suing Citigroup for making.  He is as much to blame for those loans as any human being dead or alive and he’s not only off scott free but he’s Obama’s damn TREASURY SECRETARY!!!  And of course if God – oops, I mean liberal secular humanist Government – giveth in the form of bailouts it can surely taketh away.  Just like it’s takething and takething from US now to giveth to illegals who everyone knows will soon be voting Democrat.

Only a Democrat can be rat bastard enough to assert that a company can somehow do $7 BILLION worth of wrong but the man who led the wrongdoing should be lavishly rewarded so long as he’s a loyal-enough Obama stooge.

Jonathon Turley, the nation’s foremost LIBERAL constitutional scholar, testified yesterday that Barack Obama is a clear and present danger to our Constitution.  He pointed out “a shifting of the balance of power … in favor of a now dominant Executive Branch” and describes “the rise of a type of uber-presidency.  Our system is changing in a dangerous and destabilizing way.”

Meanwhile, Obama thug Hilda Solis is clearly heard on tape pressuring a subordinate – in crystal clear FELONY violation of the Hatch Act – to support the Obama campaign.  That’s when you put pressure on somebody who works under you for the government to support a political campaign.  It’s a CRIME.  Not that violating the Hatch Act is a big deal to Obama or any of his thugs, as Kathleen Sabelius also demonstrated when she did it too.

And at this point, if you do not believe that Barack Obama ORDERED the thugs at his IRS to violate the rights of conservatives by using the tax system as a political weapon to target his enemies, I can only conclude that you are either stupid or demon-possessed or both.  Because the pattern of guilt and corruption is simply beyond overwhelming at this point.

This is the most criminally corrupt and fascist administration that has EVER been.

 

 

 

 

AP-Reported FACT: U.S. Economy The Worst Since The LAST Time We Let A Socialist Run It

July 11, 2011

The Los Angeles Times print edition ran this story on July 2 under the considerably more Marxist headline, “Wealthy benefit from recovery as workers struggle“:

U.S. Recovery’s 2-Year Anniversary Arrives With Little To Celebrate
First Posted: 07/ 1/11 05:33 PM ET Updated: 07/ 1/11 05:33 PM ET

WASHINGTON (AP) — This is one anniversary few feel like celebrating.

Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.

After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven’t kept up with prices at the grocery store and gas station. The economy’s meager gains are going mostly to the wealthiest.

Workers’ wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.

[…]

But if the Great Recession is long gone from Wall Street and corporate boardrooms, it lingers on Main Street:

Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

The average worker’s hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.

The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

[…]

Hard times have made Americans more dependent than ever on social programs, which accounted for a record 18 percent of personal income in the last three months of 2010 before coming down a bit this year. Almost 45 million Americans are on food stamps, another record.

[…]

Because the labor market remains so weak, most workers can’t demand bigger raises or look for better jobs.

“In an economic cycle that is turning up, a labor market that is healthy and vibrant, you’d see a large number of people quitting their jobs,” says Gluskin Sheff economist Rosenberg. “They quit because the grass is greener somewhere else.”

Instead, workers are toughing it out, thankful they have jobs at all. Just 1.7 million workers have quit their job each month this year, down from 2.8 million a month in 2007.

The toll of all this shows in consumer confidence, a measure of how good people feel about the economy. According to the Conference Board’s index, it’s at 58.5. Healthy is more like 90. By this point after the past three recessions, it was an average of 87.

How gloomy are Americans? A USA Today/Gallup poll eight weeks ago found that 55 percent think the recession continues, even if the experts say it’s been over for two years. That includes the 29 percent who go even further — they say it feels more like a depression.

Allow me to start with the second paragraph in the story:

“Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.”

The weakest and most lopsided of any recovery since the 1930s, you say???

WHO WAS PRESIDENT IN THE 1930s?  WHICH PARTY DOMINATED BOTH THE HOUSE AND THE SENATE IN THE 1930s?

And next let me ask you, “Are there any similarities between socialist Democrat Franklin Delano Roosevelt and socialist Democrat Barack Hussein Obama???  And the answer is, “HELL YES THERE ARE!!!”:

Which is to say, “This is the worst the U.S. economy has ever been since the LAST time we had a socialist just like FDR – and the mainstream media proudly hailed Obama as FDR and Obama’s as a NEW “New Deal.”

But here’s the truth:

FDR prolonged — not ended — great depression

Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt. After scrutinizing Roosevelt’s record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years.

”Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump,” said Ohanian, vice chair of UCLA’s Department of Economics. ”We found that a relapse isn’t likely unless lawmakers gum up a recovery with ill-conceived stimulus policies.”

In an article in the August issue of the Journal of Political Economy, Ohanian and Cole blame specific anti-competition and pro-labor measures that Roosevelt promoted and signed into law June 16, 1933.

[…]

”The fact that the Depression dragged on for years convinced generations of economists and policy-makers that capitalism could not be trusted to recover from depressions and that significant government intervention was required to achieve good outcomes,” Cole said. ”Ironically, our work shows that the recovery would have been very rapid had the government not intervened.”

And of course all the “experts” the mainstream media love to trot out have all bought hook, line and sinker the notion that capitalism is something to be loathed and feared.  So they demand that America pursue asinine government stimulus policies that fail even by the “experts'” own standards, and then these same “experts” proceed to argue that the economy failing to recover somehow is proof that more of the same thing that already failed is necessary.

These “experts” whom the mainstream media give a loud microphone to to espouse their socialist views are pathologically incapable of seeing this connection between socialist policies and an economy in the doldrums.  Every bit of negative economic news is invariably “unexpected” (liberals favorite adjective to wave a hand at bad economic developments whenever a Democrat president is in charge), because these “experts” cannot separate the inevitable results of their ideology from their terribly failed ideology.  There has to be a disconnect, or more commonly, a scapegoat.

I can simply re-cite my conclusion from a previous article to find a particularly laughable example of this phenomena:

I think of the Soviet Union, which literally blamed the total failure of their entire political philosophy and the ruinous policies that philosophy entailed by claiming that their agricultural output had been adversely affected due to 72 years of bad weather.  And the Soviet Union has gone the way of the Dodo bird for that very reason.

Is America under Obama the next Dodo bird to fall apart while we’re assured that everything is fine while some suitable scapegoat bears the blame for every failure that can’t be ignored???

It couldn’t be the fact that socialism is nothing more than state-planned economic failure.  It had to be something else, ANYTHING else.

The Big Brother from the novel 1984 had Emmanuel Goldstein.  The Big Brother who is now occupying our White House has George W. Bush.

The next obvious question to ask and answer is, “Why are the wealthy benefitting while the workers struggle?”

The answer is twofold: 1) because when you attack the employers, the first thing to go is the employees and 2) because that’s exactly how crony capitalism works.

There is a magnificent book entitled, New Deal Or Raw Deal?  How FDR’s Economic Legacy Has Damaged America, which should be required reading.  Burton Folsom Jr. points out that when FDR structured his many policies and regulations that strangled economic growth, he did so in such a way that favored the big crony capitalist corporations at the expense of the smaller businesses that could no longer compete given the costly regulatory requirements.  The smaller businesses were forced out of the market while the big businesses protected themselves with insider deals based on access to and influence with the government that only they could afford.  And there is no question whatsoever that – even as FDR employed the class warfare of socialism – the rich got richer while the poor got poorer.  Income tax revenues plunged as the wealthy sheltered their wealth from the high tax rates and the poor paid an increasingly high overall percentage of tax revenues via excise taxes.  Regulations mandating higher pay for workers priced those workers right out of their jobs.  Folsom provides the official data to back it up.

Check out this fact from page 127 of New Deal or Raw Deal?:

In 1929, prior to FDR demonizing the rich, income taxes accounted for 38% of total revenue collected, and corporate income taxes accounted for 43%.  Excise taxes which burdened the poor only counted for 19% of revenues.  By 1938, the rich and the corporations had protected themselves from FDR’s demagogic tax policies (but the poor couldn’t), such that the only 24% was collected in income taxes (versus 38%) and only 29% from corporate income taxes (versus 43%).  Meanwhile the poor-punishing excise taxes (e.g. gasoline tax) soared from 19% to 47% of the total taxes collected.  Meanwhile, when income taxes were kept low, the wealthy invariably paid FAR MORE in the total tax revenue as they put their money out to invest in and expand the economy in pursuit of the profits.  And they created millions of jobs in doing so.

And guess what?  Regulations mandating higher wages are STILL killing jobs now that Obama is doing it.

And the exact same mindset is yielding the exact same results ALL OVER AGAIN.  Obama has put the fear of God (actually the fear of the Soviet-style STATE) into the wealthy and the corporations.  They keep hearing Obama demagogue them, and they keep sheltering their money.  And they will CONTINUE to keep doing that until the threat of Obama is gone.  Just like they did with FDR.

Here we are today, with “the New FDR,” Barack Obama.  Who is the top dog on Obama’s economic team?  Why lo and behold, it is none other than GE CEO Jeffrey Immelt, crony capitalist extraordinaire whose big corporation has REPEATEDLY benefitted from a cozy insider relationship with big government.  And consider how Obama literally took big auto makers GM and Chrysler away from their legitimate shareholders and gave them to big unions.

Regarding “crony capitalism,” I made a sweeping statement in a previous article:

That said, there is also a deliberate and fundamental misunderstanding of fascism by the left.  If you read leftists, you come away thinking that somehow “fascism” is the takeover of a state by corporations. But stop and think: Hitler, Himmler, Eichmann, Hess and all the other key Nazis WEREN’T corporate CEOs who took over the state; THEY WERE SOCIALIST POLITICIANS WHO TOOK OVER THE CORPORATIONS.  They usurped the corporations and FORCED them to perform THEIR agenda.  They either performed the Nazis’ will or they were simply taken away from their rightful owners and nationalized.

And to the degree that German crony capitalist corporations helped Hitler in his rise to power, THEY WERE JUST MORE USEFUL IDIOTS.

The same sort of takeover of German corporations by socialists is building in America.  Take Maxine Waters, a liberal Democrat, as the perfect example.  What did she say of the oil companies?

“This liberal will be all about socializing … uh uh … would be about … basically … taking over … and the government running all of your companies.”

THAT’S what Hitler did, too.  Hitler got this power through regulations that required corporations to do his bidding, just like Obama has now REPEATEDLY done.

And then consider how willing Maxine Waters used “crony capitalism” (which is the essence of developing fascism) to directly personally benefit even as she shaped the banking industry.

The Democrat party is the party of socialism.  It is the party of Marxism.  It is the party of fascism.

I stand by that sweeping statement.  People need to realize that “Nazi” stood for “National SOCIALIST German Workers Party,” and that both Nazi socialism and Soviet socialism were big government socialist tyrannies that failed their people.  As to our own experiment with socialism here in the USA, I point out in an article that explains how “Government Sponsored Enterprises” Fannie Mae and Freddie Mac policies led us into economic implosion in spite of warnings for YEARS prior to the 2008 economic collapse:

But rigid opposition from Democrats – especially Democrats like Senator Barack Obamawho took more campaign money from Fannie and Freddie and dirty crony capitalism outfits like corrupt Lehman Bros. than ANYONE in his short Senate stint – prevented any “hope and change” of necessary reform from saving the US economy.

The timeline is clear: Fannie Mae and Freddie Mac were giant behemoths that began to stagger under their own corrupt weight, as even the New York Times pointed out:

Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.

And it was FANNIE and FREDDIE that collapsed FIRST before ANY of the private investment banks, which collapsed as a result of having purchased the very mortgaged backed securities that the Government Sponsored Enterprises SOLD THEM.  It wasn’t until Fannie and Freddie collapsed that investors began to look with horror at all the junk that these GSE boondoggles had been pimping.

The man who predicted the collapse in 1999 wrote a follow-up article titled, “Blame Fannie Mae and Congress For the Credit Mess.”  It really should have read, “Blame DEMOCRATS.”  Because they were crawling all over these GSEs that they had themselves created like the cockroaches they are.  But Wallison is nonpartisan

Barack and Michelle Obama have a documented personal history of crony capitalism:

The Chicago way is a very, very ugly way.  And Obama has been in it up to his eyeballs.  Chicago is a dirty place filled with dirty politicians – and Obama was perfectly at home with all the dirt.

That Chicago corruption extends right into Obama’s home, by way of his wife Michelle.  This is a woman who sat on high-paying boards in direct quid-pro-quo consequences of Obama advancing in public office.  And in some of those boards, she participated in the worst kind of hospital patient-dumping.

Here’s a video of Michelle Obama you ought to watch – if you can stand the revelations:

Too bad we voted to nationalize the Chicago Way.

I also pointed out that when you attacked employers, the ones who would be hit the most and the hardest would be EMPLOYEES.

Take a look at what’s happening to small businesses, which create at least half of all the jobs in America, under Obama.  How about the fewest new business startups since the Bureau of Labor Statistics began tracking it:

Through the 12 months ended in March of last year, 505,473 new businesses started up in the U.S., according to the latest data available from the Bureau of Labor Statistics. That’s the weakest growth since the bureau started tracking the data in the early 1990s. It’s down sharply from the record 667,341 new businesses added in the 12 months that ended in March 2006.

And we can tie this right back to crony capitalism, as Obama has created a system in which larger businesses are protected against the threat of competition from smaller businesses:

Many times large corporations will even lobby for more regulations  for their  own industry because they know that they can handle all of the  rules and  paperwork far easier than their smaller competitors can.   After all, a  large corporation with an accounting department can easily  handle filling out a  few thousand more forms, but for a small business  with only a handful  of employees that kind of paperwork is a major  logistical nightmare.

When it comes to hiring new employees, the federal government has  made the  process so complicated and so expensive for small businesses  that it is  hardly worth it anymore.  Things have gotten so bad that more  small  businesses than ever are only hiring part-time workers or  independent  contractors.

So what we actually have now is a situation where small businesses  have lots of incentives not to hire more workers, and if they really do need some extra help the rules make it much more profitable to do  whatever you can to keep from bringing people on as full-time   employees.

And who do all these rules and regulations hurt the most but the very people Democrats cynically and deceitfully claim they are trying to help?  Meanwhile, who does it help the most but the crony capitalist corporations who DON’T do most of the hiring in America who can profit from Obama’s war on business that results in the destruction of their small business competition.

A recent report by the National Federation of Independent Business points out that small businesses are planning to SHRINK rather than EXPAND their payrolls under Obama.  From the New York Times:

A Slowdown for Small Businesses
By CATHERINE RAMPELL
Published: June 14, 2011

In the latest sign that the economic recovery may have lost whatever modest oomph it had, more small businesses say that they are planning to shrink their payrolls than say they want to expand them.

That is according to a new report released Tuesday by the National Federation of Independent Business, a trade group that regularly surveys its membership of small businesses across America.

The federation’s report for May showed the worst hiring prospects in eight months. The finding provides a glimpse into the pessimism of the nation’s small firms as they put together their budgets for the coming season, and depicts a more gloomy outlook than other recent (if equally lackluster) economic indicators because this one is forward-looking.

While big companies are buoyed by record profits, many small businesses, which employ half of the country’s private sector workers, are still struggling to break even. And if the nation’s small companies plan to further delay hiring — or, worse, return to laying off workers, as they now hint they might — there is little hope that the nation’s 14 million idle workers will find gainful employment soon.

“Never in the 37-year history of our company have we seen anything at all like this,” said Frank W. Goodnight, president of Diversified Graphics, a publishing company in Salisbury, N.C. He says there is “no chance” he will hire more workers in the months ahead.

“We’re being squeezed on all sides,” he says.

So let me ask again the question that the Los Angeles Times phrased: “Why are the wealthy benefitting from the ‘recovery’ as workers struggle?

And the answer is simple: because Barack Obama and the Democrat Party are socialist who have destroyed the engine that creates the jobs that workers depend upon to flourish.

An interesting fact is that businesses are now forced to spend $1.7 TRILLION a year in regulatory compliance costs.  That is a massive hidden tax on their viability; it exceeds the overt income taxes businesses have to pay, and it most certainly exceeds their profits.  And right now Obama is attacking them via the Dodd-Frank regulatory legislation, via the EPA, via OSHA, via ObamaCare and via the ridiculous actions of the NLRB in addition to their tax burden.  Just to name a few.  The result is businesses terrified to expand and further place their necks under Obama’s axe blade.

Meanwhile, Obama’s socialist policies have not only devastated the worker by destroying his jobs, but they’ve ruined America on numerous other levels, too.  Take the housing crisis – which was THE cause of the economic implosion of 2008.  Did Obama make it better?  Well, here’s a headline for you from CNBC: “US Housing Crisis Is Now Worse Than Great Depression.”  Which is to say that Democrats – who first created the housing crisis by refusing to allow the regulation of their pet socialist wealth redistribution agencies Fannie Mae and Freddie Mac – took something awful and turned it into an American Dream-massacring nightmare.

The latest job figures simply further document my point: Obama is destroying America job by job.  Not only did the unemployment rate go up to 9.2% (Obama promised the American people that the unemployment rate would be 7.1% by now if he got his massive government-spending stimulus); not only were the previous two month figures adjusted DOWNWARD by some 45,000 jobs; not only have a third of the unemployed been unemployed for at least a YEAR with fully half of the unemployed having been unemployed for over six months (which is unprecedented); not only did the economy create an incredibly dismal 18,000 jobs (versus the 100,000 the economists naively expected); but a quarter million more people simply walked away from the workforce entirely – abandoning any hope that Obama will do anything more than crush their hopes of finding a job.

US Is in Even Worse Shape Financially Than Greece. And Why Is That In The Age Of Obama???

June 14, 2011

Thanks for “fundamentally transforming” our economy, Barry Hussein!

We’re constantly being told that Obama has done a great deal to make our economy stronger.  Because who wouldn’t rather have 9.1% unemployment than that 7.6% that Obama started out with.

The thing that most killed the US economy in 2008 was the sheer weight of godawful subprime mortgages that Democrats imposed on Fannie Mae, Freddie Mac and all the other mortgage lenders in order to create more “fairness” and allow everyone (especially racial minorities) to have “the right” to own a home whether they could actually afford to do so or not.  Fannie Mae and Freddie Mac were “Government Sponsored Enterprises,” all the investors knew.  So even as Fannie and Freddie began bundling together thousands of riskier and ever riskier mortgages into giant mortgage backed securities to advance Democrat-enacted policies, large investment houses continued to gobble them up.  After all, this was an arm of the United States Government – and the United States Government ALWAYS pays its debts.

Like all scams, it worked for a while.  But as soon as there was a correction in the dramatically overvalued housing market, the whole boondoggle began to implode.  And since Fannie and Freddie had bundled all kinds of bad mortgages in with the good ones, there was absolutely no way for anyone to know how much risk was contained in any of these giant investment vehicles all these giant private banking houses found themselves holding.

And suddenly the perception that Government Sponsored Enterprises Fannie Mae and Freddie Mac were “safe investments” turned into a “misperception.”  And the fecal matter began to hit the rotary oscillator bigtime.

Fannie and Freddie were the first to collapse.  The big private players who had played ball with them shortly followed.

President George Bush tried SEVENTEEN TIMES to reform Fannie and Freddie when there was actually a chance to do something.  Go back to what the New York Times stated in 2003:

WASHINGTON, Sept. 10—  The Bush  administration today recommended the most significant  regulatory  overhaul in the housing finance industry since the savings  and loan  crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new   agency would be created within the Treasury Department to assume   supervision of Fannie Mae and Freddie Mac, the government-sponsored   companies that are the two largest players in the mortgage lending   industry.

The new agency would have the authority, which now rests with   Congress, to set one of the two capital-reserve requirements for the   companies. It would exercise authority over any new lines of business.   And it would determine whether the two are adequately managing the risks   of their ballooning portfolios.

Republicans were demonized for “deregulation” by the dishonest Democrat Party machine.  But they TRIED to regulate what needed to be regulated.  Democrats stopped them.

Many Republicans like John McCain literally begged Democrats to do something before it was too late.  But Democrats threatened to filibuster any bill that in any way prevented Fannie and Freddie from continuing the reckless economy-killing policies.  Conservative economists such as Peter Wallison had been predicting the Fannie and Freddie boondoggles would cause an economic collapse since at least 1999.  Wallison had warned back then:

 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.”

But rigid opposition from Democrats – especially Democrats like Senator Barack Obamawho took more campaign money from Fannie and Freddie and dirty crony capitalism outfits like corrupt Lehman Bros. than ANYONE in his short Senate stint – prevented any “hope and change” of necessary reform from saving the US economy.

The timeline is clear: Fannie Mae and Freddie Mac were giant behemoths that began to stagger under their own corrupt weight, as even the New York Times pointed out:

Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.

And it was FANNIE and FREDDIE that collapsed FIRST before ANY of the private investment banks, which collapsed as a result of having purchased the very mortgaged backed securities that the Government Sponsored Enterprises SOLD THEM.  It wasn’t until Fannie and Freddie collapsed that investors began to look with horror at all the junk that these GSE boondoggles had been pimping.

The man who predicted the collapse in 1999 wrote a follow-up article titled, “Blame Fannie Mae and Congress For the Credit Mess.”  It really should have read, “Blame DEMOCRATS.”  Because they were crawling all over these GSEs that they had themselves created like the cockroaches they are.  But Wallison is nonpartisan.

That same New York Times article that said President Bush was trying to reform Fannie Mae and Freddie Mac ended with this demonstration of Democrats standing against necessary reform:

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.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving   something from one agency to another and in the process weakening the   bargaining power of poorer families and their ability to get affordable   housing,” Mr. Watt said.

Why was Barney Frank deceitfully claiming that Fannie and Freddie weren’t facing “any kind of financial crisis”?  BECAUSE REPUBLICANS WERE RIGHTLY WARNING THAT THEY WERE.

Only about a month before the whole Fannie and Freddie boondoggles Democrats had fiercely protected collapsed – taking the entire US economy with it – Democrat Barney Frank was on the record saying 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.”

So we blew up nearly COMPLETELY BECAUSE OF DEMOCRAT POLICIES.  But Democrats along with an ideological mainstream media that is the worse since Joseph Goebbels was the Nazi Minister of Propaganda were ready.  They ran on a platform that it happened while Bush was president, and that therefore Bush was entirely responsible for the thing he tried over and over again to fix while Democrats used their power to block those efforts.

Let me just say “Franklin Raines.”  Raines as Fannie CEO presided over Enron-style accounting policies and got $90 million in his account because of those corrupt policies.  But Raines was the first BLACK CEO of Fannie Mae.  And even though he was a Democrat and a Clinton guy, President Bush lacked the courage to push the “first black Fannie Mae CEO” out.  Which of course is the same reason that the “first black Fannie Mae CEO” didn’t do hard time in prison where he belonged.  “Political correctness” is a demonic device by which liberals protect themselves – usually from going to prison where they ought to go.  He got a sweetheart deal basically so Republicans wouldn’t be accused of being racists by
Democrats who of course call them racists no matter what they do.  My main point is simply that it was Democrats, Democrats, DEMOCRATS who did this to us.

Fannie Mae was well politically-connected Democrats went to make millions as they bounced back and forth between “public” employment where they developed contacts and “private” crony capitalism to get rich.

Here’s the conclusion of New York Times financial markets writer Gretchen Morgenson about DEMOCRAT Jim Johnson:

Morgenson focuses on the managers of Fannie Mae, the government-supported mortgage giant. She writes that CEO James Johnson built Fannie Mae “into the largest and most powerful financial institution in the world.”

But in the process, Morgenson says, the company fudged accounting rules, generated big salaries and bonuses for its executives, used lobby and campaign contributions to bully regulators, and encouraged the risky financial practices that led to the crisis.

And of course DEMOCRAT Jim Johnson who got rich plundering Americans was an OBAMA Democrat.

Morgenson – again a New York Times writer and not someone from Fox News – said of Fannie Mae on Larry Kudlow’s CNBC program on Monday, June 13: “Whatever Fannie Mae did, everybody else followed.”  And of course they all followed right into an economic Armageddon created by Democrats for Democrats.

But who got blamed?  Republicans, of course.  George Bush and Republicans were to Obama and the Democrats what Emmanual Goldstein was to Big Brother in 1984.  George Bush and Republicans were what the Jews were to Adolf Hitler.  Fascists always need a bogeyman.  And so the people who were truly to blame turned the people who tried futilely to stop them into the scapegoats.  All with the mainstream media’s complicity.

The analogy would be holding the police officer who tried but failed to catch the rapist for the rape of the woman rather than holding the actual rapist who raped her responsible.  But it was easier to say “This is the result of President Bush’s failed Republican policies” than it was to actually explain the facts to an enraged Attention Deficit Disorder-ridden ignorant pop culture – particularly when virtually no one in the biased mainstream media had any intention whatsoever of telling the truth.

Barack Obama – the ACORN community organizer who pushed these very America-killing policies – ran a demagoguing campaign promising to fix everything.

But has he?

How about a great big giant “NOT”???

What has Zero Obama done to fix that housing market that he helped collapse?  How about NOTHING???  After nearly three years of Obama, housing isn’t the worst since 2008; it’s gotten WAY WORSE than 2008 and is the worse since the Great Depression!!!  Obama started out with a terrible plan.  And we have terrible results to show for his terrible plan.  And yet this disgraceful fool actually keeps claiming he’s made things better!!!

Before you read this article, check out the “current account balance” compiled by the CIA.  Ours is a negative figure that dwarfs everyone else’s by so much it’s a joke.  Which is to say that Gross’s assessment is 1000% correct.

US Is in Even Worse Shape Financially Than Greece: Gross
Published: Monday, 13 Jun 2011 | 10:33 AM ET
By: Jeff Cox
CNBC.com Staff Writer

When adding in all of the money owed to cover future liabilities in entitlement programs the US is actually in worse financial shape than Greece and other debt-laden European countries, Pimco’s Bill Gross told CNBC Monday.

Much of the public focus is on the nation’s public debt, which is $14.3 trillion. But that doesn’t include money guaranteed for Medicare, Medicaid and Social Security, which comes to close to $50 trillion, according to government figures.

The government also is on the hook for other debts such as the programs related to the bailout of the financial system following the crisis of 2008 and 2009, government figures show.

Taken together, Gross puts the total at “nearly $100 trillion,” that while perhaps a bit on the high side, places the country in a highly unenviable fiscal position that he said won’t find a solution overnight.

“To think that we can reduce that within the space of a year or two is not a realistic assumption,” Gross said in a live interview. “That’s much more than Greece, that’s much more than almost any other developed country. We’ve got a problem and we have to get after it quickly.”

Gross spoke following a report that US banks were likely to scale back on their use of Treasurys as collateral against derivatives and other transactions. Bank heads say that move is likely to happen in August as Congress dithers over whether to raise the nation’s debt ceiling, according to a report in the Financial Times.

The move reflects increasing concern from the financial community over whether the US is capable of a political solution to its burgeoning debt and deficit problems.

“We’ve always wondered who will buy Treasurys” after the Federal Reserve purchases the last of its $600 billion to end the second leg of its quantitative easing program later this month, Gross said. “It’s certainly not Pimco and it’s probably not the bond funds of the world.”

Pimco, based in Newport Beach, Calif., manages more than $1.2 trillion in assets and runs the largest bond fund in the world.

Gross confirmed a report Friday that Pimco has marginally increased its Treasurys allotment—from 4 percent to 5 percent—but still has little interest in US debt and its low yields that are in place despite an ugly national balance sheet.

“Why wouldn’t an investor buy Canada with a better balance sheet or Australia with a better balance sheet with interest rates at 1 or 2 or 3 percent higher?” he said. “It simply doesn’t make any sense.”

Should the debt problem in Greece explode into a full-blown crisis—an International Monetary Fund bailout has prevented a full-scale meltdown so far—Gross predicted that German debt, not that of the US, would be the safe-haven of choice for global investors.

America is going down because her stupid citizens wickedly voted for corrupt dishonest Democrat fools – the very fools who imploded our economy – to have complete power.  Nancy Pelosi took over dictatorial control in the House of Representatives, and Harry Reid took over the US Senate, in 2006.

Thanks to Obama, America is now worse off than Greece.  But that didn’t stop Obama from offering to bail out Greece.  Maybe it’s because George Soros is Greek; maybe because the American left has always adored the European-style socialism in spite of Thomas Jefferson’s warning that “the comparison of our governments with those of Europe is like a comparison of heaven and hell.”  Maybe because Obama simply WANTS hell for America.  But there you have it.

Republicans acknowledged they failed to live up to their values and spent too much.  But the last Republican budget (Fiscal Year 2007) passed in 2006 had only a $161 billion deficit.  The very next Democrat budget for FY 2008 had a deficit of $459 billion – nearly three times larger than the one they’d demonized Republicans for.  Then their FY-2009 budget dwarfed that deficit with a black hold of red ink deficit of $1.4 TRILLION.  That was more money than any government in the history of the world had ever contemplated.  But Democrats dwarfed that the very next year with a FY-2010 budget with a $1.6 trillion deficit.  And as for FY-2011, the Democrat Congress simply refused to perform its most basic duty of governance and didn’t even bother to pass a budget.  Republicans are now forced to do the last disgraced Democrat-controlled Congress’ job for them – and Democrats are demonizing them for it.

That’s how this game is played.  Democrats are fascist demagogues who shrilly launch into Republicans as they try to save the American people from unparalleled future suffering.  They are people who ROUTINELY demonize, demonize, demonize until THEY are the ones forced to call for the very things they demonized and tried to prevent from happening.  But by the time they react this time, just as before, it will be too late.

Try this on for size: our actual debt isn’t the $14 trillion we constantly hear about; it’s more like $200 trillion.  And even THAT gargantuan number doesn’t take into account the massive debts that all the liberal labor unions have amassed in state pensions (e.g., California’s public pension system has unfunded liabilities of $500 billion).  We cannot possibly hope to pay this – and yet Democrats demand more and more and more, and demagogue Republicans for even trying to cut millions when we need to cut TENS OF TRILLIONS or collapse.

Democrats run ads showing a look-a-like of Republican Rep. Paul Ryan pushing an old lady off a cliff; but they want every single senior citizen to die terribly as the Medicare system completely collapses while they refuse to do anything to fix it – as even Bill Clinton openly acknowledged.

We are going to end like the PIIGS – Portugal, Ireland, Italy, Greece and Spain- because we elected Democrat swine to ensure we perished like pigs.

Greece just got downgraded to the point where they are the lowest-rated currency in the history of the planet.  And it happened yesterday.

When that happens to us it will be the worst nightmare in history.  300 million Americans are going to go into an insanity of panic – and of course the violence will begin with the left.  If you don’t have an arsenal, someone will kick down your door and murder your whole family just to eat the food in your house.  And that hell on earth will be entirely because you trusted Democrats like Anthony Weiner to run your health care, your pension, your economy, your life.

I hope you vote in 2012 like your very LIFE was at stake in these elections.  Because this time it truly is.

More Proof Democrats Destroyed The Economy In 2008: The Ongoing Fannie Mae/Freddie Mac Disaster

November 8, 2010

Who destroyed the economy in 2008?  Democrats say it was Bush.  Why?  Well, because he was president, that’s why.

Why – when applying the same logic – Barack Obama STILL isn’t responsible for any of his economic mess fully two years after George W. Bush left office is anybody’s guess.

But stop and think.  The primary cause for the 2008 economic meltdown was a downturn in the housing market and the underlying mortgage market.

At the core of that meltdown was GSEs (that’s “Government Sponsored Enterprises” to you) Fannie Mae and Freddie Mac.

The problem with Fannie Mae and Freddie Mac has always been that it was – and remains – a social welfare institution masquerading as a financial institution.  And they have made beyond-godawful “financial” decisions because their true loyalty has always been with socialist policies rather than financial ones.

Let’s look at Fannie and Freddie’s current picture:

Fannie, Freddie’s $685B fix
Bloomberg
Last Updated: 11:54 PM, November 4, 2010
Posted: 11:54 PM, November 4, 2010

Fannie Mae and Freddie Mac, the mortgage firms operating under federal conservatorship, may cost taxpayers as much as $685 billion as the US covers losses and overhauls the housing-finance system, Standard & Poor’s said.

Costs for resolving the two government-sponsored entities could reach $280 billion, including $148 billion already delivered under a US Treasury Department promise of unlimited support, New York-based S&P said yesterday in a research report. The government may spend an additional $405 billion to capitalize a replacement for the two companies, which own or insure more than half the US mortgage market.

“It appears unlikely in our view that housing and mortgage markets will be able to operate normally without continuing and substantial government involvement,” S&P said, citing the GSEs’ growing portfolio of unsold homes, a sluggish economy, high unemployment, the prospect of rising foreclosures and billions in legacy losses.

Treasury Secretary Timothy F. Geithner, who has said there is a strong case to be made for continued US involvement, has promised to deliver the Obama administration’s plan to overhaul the housing-finance system by the end of January. Republican lawmakers, who will take control of the House of Representatives in January, have called for the government to end its support for Washington-based Fannie Mae and Freddie Mac, of McLean, Va.

“Although federal authorities have taken no concrete public steps toward sponsoring a GSE alternative, Standard & Poor’s believes that it’s a useful exercise to consider how much such a recapitalization might cost taxpayers,” the report said.

$685 BILLION.  That’s quite a mess.

Did it just happen?  Hardly.  This was going on for years.  This was what caused the subprime crisis that destroyed our economy in 2008.

Let’s survey the record.  According to record provided by The New York Times, Fannie and Freddie were in huge trouble PRIOR TO the economic collapse.  And their holdings were so massive that there is simply no reasonable way that one can maintain that their crisis didn’t directly contribute to the greater crisis to be revealed.  Read the article dated July 11, 2008:

Fannie Mae and Freddie Mac are so big — they own or guarantee roughly half of the nation’s $12 trillion mortgage market — that the thought that they might falter once seemed unimaginable. But now a trickle of worries about the companies, which has been slowly building for years, has suddenly become a torrent.

A timeline of the subprime loan crisis of 2008 clearly reveals that it was Fannie Mae’s collapse that started the entire mess rolling downhill.  From Wikipedia:

September 2008

    • September 7: Federal takeover of Fannie Mae and Freddie Mac, which at that point owned or guaranteed about half of the U.S.’s $12 trillion mortgage market, effectively nationalizing them. This causes panic because almost every home mortgage lender and Wall Street bank relied on them to facilitate the mortgage market and investors worldwide owned $5.2 trillion of debt securities backed by them.[151][152]
    • September 14: Merrill Lynch is sold to Bank of America amidst fears of a liquidity crisis and Lehman Brothers collapse[153]
    • September 15: Lehman Brothers files for bankruptcy protection[154]
    • September 16: Moody’s and Standard and Poor’s downgrade ratings on AIG‘s credit on concerns over continuing losses to mortgage-backed securities, sending the company into fears of insolvency.[155][156] In addition, the Reserve Primary Fund “breaks the buck” leading to a run on the money market funds. Over $140 billion is withdrawn vs. $7 billion the week prior. This leads to problems for the commercial paper market, a key source of funding for corporations, which suddenly could not get funds or had to pay much higher interest rates.[157]
    • September 17: The US Federal Reserve lends $85 billion to American International Group (AIG) to avoid bankruptcy.
    • September 18: Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke meet with key legislators to propose a $700 billion emergency bailout through the purchase of toxic assets. Bernanke tells them: “If we don’t do this, we may not have an economy on Monday.”[158]
    • September 19: Paulson financial rescue plan is unveiled after a volatile week in stock and debt markets.

Democrats who bother to offer any reason at all why “Republicans got us into this mess” claim that the Republicans refused to regulate and reform the economic sector.

Well, let’s dig a little further.  Was it George Bush who refused to regulate or reform?

Hardly.

From US News & World Report:

Seventeen. That’s how many times, according to this White House statement (hat tip Gateway Pundit), that the Bush administration has called for tighter regulation of the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.

That’s right.  George Bush tried SEVENTEEN TIMES to reform and regulate Fannie Mae and Freddie Mac, the agencies at the epicenter of the economic crisis.

When did this thing start?  Under Bush?  Not according to The New York Times, as I have pointed out before in a previous article.

From the New York Times, September 30, 1999:

Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

More.  Again from the New York Times, 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.”

What do we have, even in the pages of the New York Times?  A prediction that as soon as the economy cooled off, the mortgage market would explode like a depth charge and the government would have to step in to prevent a catastrophe.  And from a Clinton program, at that.

The same man – Peter Wallison – who had predicted the disaster from 1999 wrote a September 23, 2008 article in the Wall Street Journal entitled “Blame Fannie Mae and Congress For the Credit Mess.”

So this disaster began under Bill Clinton.  Specifically, it began in the very final years of the Clinton administration.  Interestingly, at the same time that the Dot-com bubble was getting ready to explode on Clinton’s watch.  Clinton got all the credit for a great economy, and Bush got to watch 78% of the value of Nasdaq destroyed just as he was taking office.  $7.1 TRILLION in wealth was vaporized (43% of the the Market Capitalization of the Dow Jones Wilshire 5000 Full Cap between 2000 Q1 and Q1 2003).  Bill Clinton handed George Bush a massive economic disaster (made even worse by the shocking 9/11 attacks), and Bush turned economic calamity into the longest consecutive period of job growth (52 straight months) in history.  In diametrical contradiction to all the lies that you have  heard from Democrats and from a mainstream media propaganda machine that often puts Joseph Goebbels to shame

What did George W. Bush do to deal with the necessary regulation and reform of these government-subsidized behemoths Fannie and Freddie?

Read what the New York Times said back in September 11, 2003:

WASHINGTON, Sept. 10— The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

So Bush WANTED to regulate and reform the industry that would destroy the economy five years later, again, in contradiction to a blatantly dishonest and ideologically liberal and biased media.  Bush didn’t “refuse to regulate.”  Bush TRIED to provide the necessary regulatory steps that could have averted disaster.

And who blocked those regulations and reforms that Bush tried to provide?  None other than Barney Frank and his Democrat buddies:

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.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

Democrats blocked reform and regulation of Fannie and Freddie.  They threatened to filibuster any attempt at regulation and reform.  Meanwhile John McCain wrote a letter in 2006 urging reform and regulation of the GSEs.  He said:

Congress chartered Fannie and Freddie to provide access to home financing by maintaining liquidity in the secondary mortgage market. Today, almost half of all mortgages in the U.S. are owned or guaranteed by these GSEs. They are mammoth financial institutions with almost $1.5 Trillion of debt outstanding between them. With the fiscal challenges facing us today (deficits, entitlements, pensions and flood insurance), Congress must ask itself who would actually pay this debt if Fannie or Freddie could not?

And it came to pass exactly as John McCain warned.

Because of Democrats.  Who were virtually entirely to blame for the disaster that ensued as a result of their blocking of reform and regulation.

What did Democrats do with the mainstream media’s culpability?  They falsely dropped the crisis at the feet of “greedy” Wall Street.  But while examples of Wall Street greed abound, the liberal intelligentsia deliberately overlooked the central and preceding role of Democrat-dominated Fannie Mae and Freddie Mac.

Here’s how the mess actually happened:

The New York Times acknowledged that Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac “buy mortgages from lenders and repackage them as securities or hold them in their own portfolios.”

And the Los Angeles Times on May 31, 1999 describes how this process turned into a bubble, as more begat more, and then more and more begat more and more and more:

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. . . .

In a nutshell, Fannie and Freddie, in their role as Government Sponsored Enterprises, bought tens of millions of mortgages, and then repackaged them into huge mortgage-backed securities that giant private entities such as Bear Stearns, AIG and Lehman Brothers purchased.  What made these securities particularly attractive to the private banking entities was that these securities were essentially being sold – and had the backing – of the United States government.  Fannie Mae and Freddie Mac, again, are Government Sponsored Enterprises.

Here’s the process:

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.

Now, any intelligent observer should note a primary conflict that amounts to a fundamental hypocritical contradiction: the GSE’s role was to “provide stability,” and yet at the same time they were taking on “significantly more risk” in the final year of the Clinton presidency.  What’s wrong with this picture?

The GSEs Fannie Mae and Freddie Mac were designed to bundle up the mortgages into mortgage backed securities and then sell them to the private market.

Fannie Mae is exempt from SEC [Securities and Exchange Commission] regulation. Which screams why Bush wanted to regulate them.  This allowed Fannie Mae to bundle up mortgages, which were then rated AAA with no requirement to make clear what is in the bundle.  Which screams why Bush wanted to regulate them.

This is what allowed the toxic instruments that have been sold across the world to proliferate.  And then to explode.  It also created a situation where money institutions did not know and could not find out whether potential inter-bank business partners were holding these “boiled babies on their books, complete with a golden stamp on the wrapping,” rather than safe instruments.  This then inclined banks to a natural caution, to be wary of lending good money to other banks against these ‘assets’.  And thus banks refused to lend to one another.

And it was Democrats, not Bush, and not Republicans, who were all over this disaster that destroyed our economy in 2008.

We were led by a pathologically dishonest media to believe that Republicans had created this mess, when it fact it had been Democrats.  And so we gave the very fools who destroyed our economy total power.

And what have they done in the two years since?

They made bad far, far worse.

Why Did Our Economy Melt Down In 2008? (Email This To Your Friends)

October 25, 2010

Note: I did not write the following; I am only passing it along.  I hope you read it and then pass it along as well.

Remember the LONG-TERM Causes of the Financial Sector Meltdown (an email pre-formatted for sending)
FreedomKeys.com ^ | 20101010 | various
Posted on 10/23/2010 12:49:32 PM PDT by FreeKeys

Would the Last Honest Reporter Please Turn On the Lights?
by novelist Orson Scott Card, a Democrat
_________
.. This [financial crisis] was completely foreseeable and in fact many people did foresee it.  One political party, in Congress and in the executive branch, tried repeatedly to tighten up the rules.  The other party blocked every such attempt and tried to loosen them.
..
Furthermore, Freddie Mac and Fannie Mae were making political contributions to the very members of Congress who were allowing them to make irresponsible loans.  (Though why quasi-federal agencies were allowed to do so baffles me.  It’s as if the Pentagon were allowed to contribute to the political campaigns of Congressmen who support increasing their budget.) …
..
If you who produce our local daily paper actually had any principles, you would be pounding this story, because the prosperity of all Americans was put at risk by the foolish, short-sighted, politically selfish, and possibly corrupt actions of leading Democrats, including Obama.
..
If you who produce our local daily paper had any personal honor, you would find it unbearable to let the American people believe that somehow Republicans were to blame for this crisis. …
..
So I ask you now: Do you have any standards at all?  Do you even know what honesty means?
..
[Was] getting people to vote for Barack Obama so important that you will throw away everything that journalism is supposed to stand for? …
..
… tell the truth about John McCain: that he tried, as a Senator, to do what it took to prevent this crisis.  You will tell the truth about President Bush: that his administration tried more than once to get Congress to regulate lending in a responsible way.
..
This was a Congress-caused crisis, beginning during the Clinton administration, with Democrats leading the way into the crisis and blocking every effort to get out of it in a timely fashion.
..
If you at our local daily newspaper continue to let Americans believe — and vote as if — President Bush and the Republicans caused the crisis, then you are joining in that lie.
– Novelist Orson Scott Card, a Democrat, on October 5, 2008,HERE
..
.. The Financial Sector Meltdown ..
1.  Almost all of the financial problems we see today are based on bad mortgage lending.  That would be lending money to people to buy homes who didn’t qualify for a loan.
..
2.  The Democrats, under Clinton, strengthened a government-created monster called the “Community Reinvestment Act” [first foisted upon the country under Jimmy Carter].  This law was then used by “activists” and “community organizers” …  to coerce lending institutions to make these bad loans … millions of them.
..
3.  Now we see what happens when political “wisdom” supplants good loan underwriting.  When private financial institutions are virtually forced to make loans to people with a bad credit and job history … this is what you get.  Enjoy it. — Neal Boortz, here ..


.
Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.
..
Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street’s efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.
..
In the times that Fannie and Freddie couldn’t make the market, they became the market.
.. — Kevin Hassett, Bloomberg News, here ..

 


.. Obama choice helped Fannie block oversight
National security adviser tied to discrediting of probe ..
By Jim McElhatton, The Washington Times,October 13, 2010 here
..
UNDER SCRUTINY: Thomas E. Donilon worked as a registered lobbyist for Fannie Mae from 1999 to 2005.
..
Years before Fannie Mae foundered amid a massive accounting scandal, President Obama’s choice for national security adviser oversaw an office inside the mortgage giant that orchestrated a negative publicity blitz to fight attempts by Congress to increase government oversight, records show.
..
Thomas E. Donilon, who won the job as national security adviser this month, worked as a registered lobbyist for Fannie Mae from 1999 to 2005 at a time the company’s officials insisted finances were sound. He also earned more than $1.8 million in bonuses [from Frannie Mae] before the government took over the troubled company in the wake of an accounting scandal.
..
Vice President Joseph R. Biden Jr. and Mr. Obama, who railed against lobbyists on the campaign trail, hailed Mr. Donilon’s appointment last week, but made no mention of his time as a registered lobbyist.st wee
..

 


..
Democrats and some [big-government] Republicans opposed reform in part because Fannie and Freddie were very good at greasing palms. Fannie has spent $170 million on lobbying since 1998 and $19.3 million on political contributions since 1990.
..
The principal recipient of Fannie Mae’s largesse was a Democrat, Sen. Chris Dodd (D, CT), chairman of the Senate Banking Committee. No. 2 was another Democrat, Sen. Barack Obama (D, IL).
..
Mr. Dodd was also the second largest recipient in the Senate of contributions from Countrywide’s political action committee and its employees, and the recipient of a home loan from Countrywide at well below market rates.  The No. 1 senator on Countrywide’s list? Barack Obama. Check it out here:  http://tinyurl.com/4h9955
..

 


..
“Congressman Frank and Senator Dodd wanted the government to push financial institutions to lend to people they would not lend to otherwise, because of the risk of default.
..
“The idea that politicians can assess risks better than people who have spent their whole careers assessing risks should have been so obviously absurd that no one would take it seriously.” — Dr. Thomas Sowell, Professor Emeritus, Economics, Stanford University, HERE
..

 


..
When the Bush administration tried to rein in Freddie and Fannie from continuing to engage in risky practices, guess who stepped in to block their efforts? Democratic senators Chris Dodd, John Kerry, Hillary Clinton, and — are you ready? — Barack Obama.
..
Meanwhile, guess who were the top four recipients of campaign contributions from Fannie and Freddie between 1988 and 2008?
..
Senators Chris Dodd, John Kerry, Hillary Clinton, and — still ready? — Barack Obama.
..
A coincidence, I tell you — just a coincidence.
..
More mere coincidences: Franklin Raines — a former Carter- and Clinton-administration official and former head of Fannie Mae, now under investigation for cooking its books — had a lot of powerful people in Congress beholden to his agency. Here is a list of his campaign-contribution recipients. Meanwhile, Democratic honcho Jim Johnson, another former Fannie Mae CEO, has been an economic adviser to and major fundraiser for Barack Obama, and even ran his vice-presidential search committee until growing scandals over his Fannie management forced him to step down in July. – Robert Bidinotto, here ..

 


..
On May 25, 2006, Sen. John McCain spoke forcefully on behalf of the Federal Housing Enterprise Regulatory Reform Act of 2005.  He said on the floor of the Senate:
..
“Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.
..
“The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.
..
” The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.
..
“For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.
..
“I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.
..
“I urge my colleagues to support swift action on this GSE reform legislation.”
..
It died at the hands of the DEMOCRATS —
HERE’s a video clip showing their anger.
..

 


..
“Many politicians and pundits claim that the credit crunch and high mortgage foreclosure rate is an example of market failure and want government to step in to bail out creditors and borrowers at the expense of taxpayers who prudently managed their affairs. These financial problems are not market failures but government failure.The credit crunch and foreclosure problems are failures of government policy.” — Dr. Walter E. Williams, the John M. Olin distinguished professor of economics at George Mason University, HERE
..

 


..
“Barack Obama wasn’t just the second-largest recipient of Fannie Mae and Freddie Mac political contributions. He was also the senator from ACORN, the activist leader for risky ‘affirmative action’ loans. … [The CRA] gave groups such as ACORN a license and a means to intimidate banks … ACORN employed its tactics in 1991 by taking over the House Banking Committee room for two days to protest efforts to scale back the CRA. … Obama represented ACORN in a 1994 suit against redlining.  ACORN was also a driving force behind a 1995 regulatory revision pushed through by the Clinton administration that greatly expanded the CRA and helped spawn the current financial crisis. Obama was the attorney representing ACORN in this effort.” — IBD Editorials
..
“The Woods Fund report makes it clear Obama was fully aware of the intimidation tactics used by ACORN’s Madeline Talbott in her pioneering [“community organizer”] efforts to force banks to suspend their usual credit standards. Yet he supported Talbott in every conceivable way. He trained her personal staff and other aspiring ACORN leaders, he consulted with her extensively, and he arranged a major boost in foundation funding [via CAC and Woods Fund] for her efforts.” — Stanley Kurtz, “BARACK’S ‘ORGAANIZER’ BUDS PUSHED FOR BAD MORTGAGES”HERE
.

 


.
Bloomberg News has an excellent recap of
the history of the financial meltdown:.HERE.
.

 


 

Barney Frank, Chris Dodd, Jimmy Carter, Barack Obama
not shown: Bill Clinton


..

 


“Scratch the surface of an endemic problem — famine, illness, poverty —  and you invariably find a politician at the source.” —  Simon Carr

 


“One of the methods used by statists to destroy capitalism consists in establishing controls that tie a given industry hand and foot, making it unable to solve its problems, then declaring that freedom has failed and stronger controls are necessary.” — Ayn Rand

 


“I think that we all need to consider the possibility … just the possibility … that Obama is engaged in a conscious effort to destroy our free market economy so that he can build a government-controlled socialist party on the rubble.” — Neal Boortz, here
[Conscious effort or not, we have an emergency on our hands.]

 

It Was DEMOCRATS Who Blew Up Our Economy In 2008

October 19, 2010

I’ve been saying this for months: It was DEMOCRATS who destroyed our economy in 2008.

First of all, given all the times that you’ve heard the line, “The Republicans created this mess,” ask yourself a question: when was the last time you heard an explanation as to just precisely what the Republicans did to cause the disaster?

Don’t be a lemming and a tool; read up on how Democrats loaded up GSEs Fannie and Freddie with liberals, massively increased the government ownership of the mortgage industry, engaged in incredibly risky policies even as our housing market was beginning a cyclical downturn, and then refused to allow any regulations or reform whatsoever:

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

Who REALLY Exploded Your Economy, Liberals Or Conservatives?

Biden: We Misread The Economy – And It’s All The Republicans’ Fault

Want To Know Why Your Economy Blew Up?

Barney Frank And Democrat Party Most Responsible For 2008 Economic Collapse

This Blame Bush Crap Has Just GOT To End

And here’s the latest fact and the latest explanation as to just how Democrats blew up our economy:

The quotes that explain the entire financial meltdown
posted at 12:10 pm on October 12, 2008 by Ed Morrissey

For those who want a smoking gun to show the genesis of the financial collapse, this short sequence from a longer video I posted this week will do it. Clinton HUD Secretary Andrew Cuomo announced a settlement of a lending discrimination complaint with Accubanc, a Texas lender whose prerequisites for mortgages came under attack from “community organizers” at the Fort Worth Human Relations Commission and the city of Dallas. I clipped out this sequence to underscore its importance:

Watch the video.

CUOMO: To take a greater risk on these mortgages, yes. To give families mortgages that they would not have given otherwise, yes.

Q: [unintellible] … that they would not have given the loans at all?

CUOMO: They would not have qualified but for this affirmative action on the part of the bank, yes.

Q: Are minorities represented in that low and moderate income group?

CUOMO: It is by income, and is it also by minorities? Yes.

CUOMO: With the 2.1 billion, lending that amount in mortgages — which will be a higher risk, and I’m sure there will be a higher default rate on those mortgages than on the rest of the portfolio

Here, in fact, is the genesis of the problem, the ideology that created the monster.  Cuomo, the Clinton administration, and Congress believed they had the right and the power to determine acceptable risk for the lenders, rather than lenders determining it for themselves in a free market.  Even while imposing risk standards on lenders, Cuomo admits that he expects a higher default rate on the new loans — which is why the lenders didn’t want to write them in the first place.

In other words, the CRA didn’t get used to fight discrimination, but to force lenders to give money to high-risk borrowers for political purposes.  And Cuomo knew it.

That was the political arrogance at the heart of the collapse.  However, the CRA was more a sideshow than the actual problem.  When Congress decided that enforcement alone wouldn’t generate enough mortgages to boost their political fortunes, they had Fannie Mae and Freddie Mac eliminate the risk entirely for lenders through the purchase of the subprime loans.  Without that risk and with almost-guaranteed short-term profits of subprime loans, lenders went wild while Fannie and Freddie repackaged them as quasi-government bonds for investors.

While Democrats like Barack Obama, Harry Reid, and Nancy Pelosi keep blaming “greed” for the collapse, it was Democrats like Barney Frank and Chris Dodd building that “greed” into the system in order to drive the subprime lending market.  And it was Democrats like Frank, Dodd, Maxine Waters, and Lacy Clay who suggested that regulators like Armando Falcon were racists for blowing the whistle on the Ponzi scheme they created.

The Democrats decided, as Michelle says, that mortgages were a civil right, and wouldn’t cost the American taxpayers a dime.  How well is that working out, America?  And now, the question you have to ask yourselves is this: Do you want the nation’s economic policies run by Obama, Pelosi, Reid, Dodd, and Frank for the next two years?

John Adams said, “Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”

The problem is that we aren’t a moral or religious people anymore.

We’ve become a bad people.  And bad people allow a climate in which lies dominate, and then they believe the lies they are told.

And that is why we allowed a mainstream media to fabricate an entire culture of lies, and then we believed their narrative that Republicans (who hadn’t been in power for two years in the Congress) were the party to blame.  We blamed Bush – who tried SEVENTEEN TIMES to reform and regulate Fannie Mae and Freddie Mac prior to the economic meltdown just in 2008 alone.  And Bush had called for reform and regulation of the GSEs 34 times since 2001.  And we put the very Democrats who blew up our economy by refusing to allow those reforms or regulations until after it was too late in charge of the economy that they ruined.

It was Democrats and the Government Sponsored Enterprise system Democrats created (i.e., GSEs Fannie and Freddie) that created the financial disaster; just as it is Democrats who are in total control of our government who are CONTINUING to undermine our economy now.

We gave Democrats total power.  And in just two years they have so destroyed our economy and our health care system that we may never be able to recover.

Scared Democrats Admit Bush Was Right On Tax Cutting Policy

September 5, 2010

More and more Democrats are admitting that increasing taxes on the rich people who actually create jobs would be a foolhardy thing to do.

That pours a big giant can of water on the fire Democrats started in the whole blame-Bush-for-the-economic-meltdown thing.  Bush’s tax cuts were the biggest straw man for Democrats.  And now some of the most prominent Democrats are saying we need to keep those same tax cuts that Democrats were universally demonizing only months ago.

More Dems buck plan to let taxes increase for rich
By STEPHEN OHLEMACHER (AP) – 1 day ago

WASHINGTON — Congress seems increasingly reluctant to let taxes go up, even on wealthier Americans.

Worried about the fragile economy and their own upcoming elections, a growing number of Democrats are joining the rock-solid Republican opposition to President Barack Obama’s plans to let some of the Bush administration’s tax cuts expire.

Democratic leaders in Congress still back Obama, but the willingness to raise taxes is waning among the rank and file as the stagnant economy threatens the party’s majority in the House and Senate.

“In my view this is no time to do anything that could be jarring to a fragile recovery,” said Rep. Gerry Connolly of Virginia, a first-term Democrat. […]

“It’s going to be hard to resist a one-year extension for everybody, given the state of the economy,” said Clint Stretch, a tax expert at the consulting firm Deloitte Tax LLP. “That’s where I think the ball is moving.”

The tax cuts were enacted in 2001 and 2003 under President George W. Bush. They provided help for both rich and poor, reducing the lowest marginal rates as well as the top ones and several in between. They also provided a wide range of income tax breaks for education, families with children and married couples.

Taxes on capital gains and dividends were reduced, while the federal estate tax was gradually repealed, though only through this year. […]

Another freshman Democrat, Rep. Bobby Bright of Alabama, said he would like to see all the tax cuts extended for two or three years, if lawmakers cannot agree on a more permanent plan.

“Party leaders are not my directors or my boss,” Bright said. “My boss is my constituents, and I’ve heard from a vast majority of my constituents that they don’t believe in tax increases on anybody at this point in time.”

Bright is high on the re-election endangered list, one of roughly four dozen Democrats in districts won by Republican presidential nominee John McCain in 2008.

In the Senate, where Democrats need unity and at least one Republican vote to overcome filibusters, at least three Democrats and independent Joe Lieberman of Connecticut have said they want to extend all the tax cuts temporarily.

Several Democratic candidates for Senate have also come out in favor of extending them all, including Robin Carnahan in Missouri and Jack Conway in Kentucky.

“Jack Conway was in favor of the Bush tax cuts when they first passed (in 2001 and 2003), and he’s in favor of extending the Bush tax cuts now,” said spokeswoman Allison Haley.

An article in McClatchey Newspapers points out that if Democrats try to hike taxes on the rich, it will be Democrats who stood in the way:

Democrats unlikely to repeal tax cuts for the rich
By David Lightman | McClatchy Newspapers

WASHINGTON — Democrats in Congress are poised to play a leading role this month in thwarting their party’s effort to raise income tax rates on the wealthy.

Tax cuts enacted in 2001 and 2003 expire at the end of this year. President Barack Obama and Democratic congressional leaders have been eager to extend the breaks for individuals who earn less than $200,000 annually and joint filers who make less than $250,000. Those who earn more would pay higher, pre-2001 rates starting next year.

However, a small but growing number of moderate Democrats are balking at boosting taxes on the rich. Many face electorates that recoil at the mention of any tax increase. Some represent areas that are loaded with wealthier taxpayers. Further, some incumbent senators who don’t face voters this fall are reluctant to increase taxes on anyone while the economy remains sluggish.

Without their support, the push to raise rates on the rich probably will fail. […]

Many Democrats and Republicans are eager for a tax cut battle, seeing it as emblematic of each party’s economic principles.

“Now the administration is calling for a massive tax hike on small businesses in the middle of a recession,” said Senate Republican leader Mitch McConnell of Kentucky, who maintains that higher rates on the wealthy would hit small business hard, a point the Obama administration disputes.

“So it’s no surprise,” McConnell added, “that most Americans think the country is on the wrong track and that Democrat policies have failed to do anything to fix their top concern, the economy.”

Democratic leaders are convinced that voters won’t buy that argument. Not only will the public back higher taxes for the rich, but “we have an opportunity to generate $700 billion that could go to deficit reduction and badly needed programs,” said Rep. Raul Grijalva, D-Ariz., a co-chairman of the House Progressive Caucus.

The middle class-only extension is thought to have strong support in the House, where Democrats have a huge majority, but some Democrats are reluctant.

Rep. Gerald Connolly, D-Va
., represents the northern Virginia suburbs of Washington, one of the nation’s wealthiest districts. Median family income there in 2008 was $117,892, well above the national average of $63,211. He said that repealing the top rates would have political consequences.

“Sometimes we forget how we became the majority. We did it by winning some affluent districts,” he said.

The bigger problem for Democrats looms in the Senate, where Majority Leader Reid’s immediate problem is getting the 60 votes needed to cut off debate on the measure. Democrats control 59 seats, and at least three of them — Bayh, Ben Nelson of Nebraska and Kent Conrad of North Dakota — have signaled that they won’t back a permanent repeal of the tax cuts for the wealthy.

They suggest a way out of a stalemate — temporarily extending all the expiring tax rates — but so far the leadership isn’t going along.

Sean Neary, a spokesman for Senate Budget Committee Chairman Conrad, said the senator backed such an extension “for now.”

“The general rule of thumb is that you do not raise taxes or cut spending during an economic downturn. That would be counterproductive,” Conrad said.

Nelson also offered what’s become the centrist Democratic mantra. He, too, said he’d back extending the tax breaks for the wealthy “for at least a period of time because raising taxes in a weak economy could impair recovery.”

That stand could be even more popular with Democratic candidates for the Senate who aren’t incumbents
. The hottest races are in conservative states, such as Kentucky, where Republican Rand Paul and Democrat Jack Conway are battling for the seat now held by Republican Sen. Jim Bunning.

Of the expiring tax cuts for the wealthy, Conway spokeswoman Allison Haley said that he “believes we should extend them now, especially when so many Kentucky families and small businesses are struggling under this recession.”

In Missouri, Republican U.S. Rep. Roy Blunt and Democrat Robin Carnahan are in a tight race. Despite a welcoming embrace with Obama at a Kansas City fundraiser in July, Carnahan said last week that she wanted to extend the Bush tax cuts for everyone.

“Now is not the time to raise taxes,” she said.

In Indiana, U.S. Rep. Brad Ellsworth, D-Ind., who’s seeking to replace Bayh, told the Evansville Courier & Press this summer that all the Bush-era tax cuts should become permanent
.

That position makes sense, said Brian Vargus, a professor of political science at Indiana University-Purdue University Indianapolis, because Indiana is “an overwhelmingly Republican state … and there is never support for taxes or public goods.”

So from this article we see the term “moderate.”  And the moderates are those Democrats who see a compromise to the looming war over tax cuts: keep them all for now.  Don’t hike taxes on the only economic class of Americans who have the wherewithal to actually create jobs.  Keep the the tax cuts for at least a year, if not 2-3 years.  But the hard-liner Democrats are willing to see the tax cuts end for EVERYONE in order to maintain their Marxist class warfare principle of punishing the rich for being successful.

Democrats offered two reasons in their unrelenting demagoguery of George Bush: 1) they said the tax cuts caused the economic disaster; and 2) they said Bush’s refusal to regulate caused the economic disaster.

But 1) is now blown apart, given DEMOCRATS’ current acknowledgment that the Bush tax cuts – yes, even for the rich – weren’t the bogey man Democrats have been saying.

And 2) suffers from the flaw that Bush DID try to regulate the entity most responsible for the meltdown that befell the economy in 2008, and the ONLY reason that entity was not reformed and regulated was because DEMOCRATS blocked Bush at every turn.

That entity was the Government Sponsored Enterprise, or GSE, commonly known by the brand names of Fannie Mae and Freddie Mac.

It was Fannie and Freddie that expanded and ultimately exploded using dangerous subprime loans (see also here).  It was also Fannie Mae and Freddie Mac who bundled thousands of bad and good mortgages together into instruments called “mortgage backed securities” and sold them to the private sector.  And when no one could separate the good from the bad, uncertainty paralyzed the banking system and led to the crash.

A brief history of the mortgage meltdown reveals how it was the GSEs acting under Democrat policies that created the housing bubble – (and even Obama economic shill Christina Romer admits “the popping of the housing bubble had serious consequences” which “destroyed $13 trillion of wealth in 2008”) – and the corresponding mortgage crisis which imploded our economy:

In 1999, under pressure from the Clinton administration, Fannie Mae, the nation’s largest home mortgage underwriter, relaxed credit requirements on the loans it would purchase from other banks and lenders, hoping that easing these restrictions would result in increased loan availability for minority and low-income buyers. Putting pressure on the GSE’s (Government Sponsored Enterprise) Fannie Mae and Freddie Mac, the Clinton administration looked to increase their sub-prime portfolios, including the Department of Housing and Urban Development expressing its interest in the GSE’s maintaining a 50% portion of their portfolios in loans to low and moderate-income borrowers.[10]

As noted, subprime mortgages sky-rocketed during the initial era of loosening of terms throughout the 1990’s. From a low of 5% of mortgages in 1994, to 14% in 1997, to 23% in 2005, subprime mortgages continued to boom in the early 2000’s. Following the 2004 initiative policy change spearheaded by a U.S. Securities and Exchange Commission (SEC) decision to allow the largest brokerage firms to borrow upwards of 30 times their capital, subprimes became an even greater investment vehicle for investment banks and institutions in the U.S. and around the world. Since 1994, the securitization rate of subprime loans has increased from approximately 32 percent to nearly 78 percent of total subprime originations.[11] This further exposed the financial community to the effects of the coming housing bubble.

Democrat policies created the housing bubble that Christina Romer acknowledges was the cause of the destruction of the US economy.

And the refusal of Democrats to reform and regulate Fannie and Freddie exploded that bubble.

Bush warned SEVENTEEN TIMES that we needed to reform Freddie Mac and Fannie Mae or have an economic disaster on our hands.  John McCain urged action to avert an economic disaster.  And Democrats refused to budge to deal with the monster they created.

Again, Bush was right.  Democrats were profoundly wrong.

The mainstream media propagandists refused to report the truth.  They kept broadcasting a lie, and naive and frankly stupid Americans rewarded the Democrats who created the economic disaster with total power.

And we’ve been paying for that stupidity for the last two years.

As of today, Obama is at a dismal 42% approval, and in danger of plunging into the 30s.  45% of Americans now strongly disapprove of Obama, versus only 24% who still strongly approve of the job he’s doing “fundamentally transforming” our economy into a pre-industrial barter system.

Obama is in full meltdown mode as all of his campaign rhetoric is being revealed for the lies it always was:

And Democrats are deservedly going to meltdown right along with him.

Barney Frank And Democrat Party Most Responsible For 2008 Economic Collapse

August 10, 2010

I don’t want to ridicule Barney Frank on account of his weight.  Suffice it to say he is easily able to pull off the two faces he routinely wears, and the two sides he routinely takes.

Here’s the recent side of Barney Frank:

Frank: “well one of my biggest differences with the Bush administration, even with the Clinton administration, was that they overdid that. I have always been critical of this effort to equate a decent home with home ownership. I think we should have been doing more to provide rental housing, my efforts have been to try and get affordable rental housing I was very much in disagreement with this push into home ownership and I think the federal government should not be artificially doing that. The goal is for people to have decent housing and I think beginning in the Clinton administration, exacerbated by Bush, we pushed people too much into home ownership…”
– Barney Frank, May 20, ‘2010 on CNBC.

And here’s Frank from 2005 documenting the fact that Barney Frank in 2010 is a rank liar:

“This is a very important resolution, particularly at this time, because we have, I think, an excessive degree of concern right now about home ownership and its role in the economy.
Obviously, speculation is never a good thing. But those who argue that housing prices are now at the point of a bubble seem to be missing a very important point. Unlike previous examples, where substantial excessive inflation of prices later caused some problems, we are talking here about an entity, home ownership, homes, where there is not the degree of leverage that we have seen elsewhere.

This is not the dot-com situation. We had problems with people having invested in business plans for which there was no reality and people building fiber-optic cable for which there was no need. Homes that are occupied may see an ebb and flow in the price at a certain percentage level, but you will not see the collapse that you see when people talk about a bubble.

So those of us on our committee in particular will continue to push for home ownership.
– Barney Frank, 2005

link
Video Link

[I found these quotes at US Politics Online].

You’re right, Barney.  It wasn’t the Dot-com situation.  It was a hundred times WORSE than the Dot-com situation, even given as bad as the Dot-com bubble was.  And yeah, you sure were right when you said there wouldn’t be a collapse, weren’t you?

So first of all, we have Barney Frank – liberal Democrat par excellence – acknowledging that the bad policy that led to the mortgage market meltdown was actually a CLINTON policy that Bush merely continued (most likely because he knew he’d be called a “racist” the moment he ended a program that gave billions of dollars to minorities to buy homes they couldn’t afford).

From the New York Times, September 30, 1999:

Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

It’s beyond asinine that Democrats blame Bush for ruining the economy, and praise Clinton as having the mostest wonderfulest economy ever, when it was a Clinton program that ruined the Bush economy.  But that’s the mainstream media narrative for you.

It’s ironic that Frank in hindsight so laughably compared the housing mortgage bubble that brought down the economy in 2008 to the Dot-com bubble that brought down the economy just as Clinton was leaving office.  Because that’s TWO giant economy-killers that “Mister Wonderful Clinton” inflicted on George Bush.  The Clinton-era Dot-com crash ultimately destroyed 78% of the Nasdaq composite.  Clinton benefited with a huge market surge, and Bush paid with a huge market collapse that began taking place while the handprint on the Bible from Bush’s oath of office was still warm.

So Barney Frank reminds us that the destruction of the Bush economy was bookended by massive Clinton failures – the Dot-com bubble collapse in 2001 and the housing market bubble collapse in 2008.  And Clinton was never blamed for either of them by the propagandist mainstream media.

The second thing you can notice is that Democrats like Barney Frank – who were so quick to pounce all over the mortgage meltdown and blame Bush for it – were not only the ones who created the problem, but were the ones who defended the problem.

What’s the Democrat-mainstream media-created narrative for why we had the 2008 collapse?  Republicans refusing to regulate?  Read what the New York Times said back in September 11, 2003:

WASHINGTON, Sept. 10— The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

So Bush WANTED to regulate, in contradiction to all the lies that you heard.

And who blocked those regulations?  Omigosh, it was Barney Frank and his Democrats.

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.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

You would find if you bothered to look at the facts that Bush demanded reform and regulation of Fannie Mae and Freddie Mac SEVENTEEN TIMES during his presidency.  And that Democrats refused to regulate the GSEs and even threatened filibusters against regulation.  Not that the mainstream media is honest enough to report the truth.

You would find if you bothered to look at the facts that financial experts literally predicted that the Clinton-birthed Fannie and Freddie expansion would ultimately explode.

Again from the New York Times, 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.”

What do we have, even in the pages of the New York Slimes?  A prediction that as soon as the economy cooled off, the mortgage market wold explode like a depth charge and the government would have to step in to prevent a catastrophe?  From a Clinton program?

The same man – Peter Wallison – who had predicted the disaster from 1999 wrote a September 23, 2008 article in the Wall Street Journal entitled “Blame Fannie Mae and Congress For the Credit Mess.”

The New York Times acknowledged that Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac “buy mortgages from lenders and repackage them as securities or hold them in their own portfolios.”

And the Los Angeles Times on May 31, 1999 describes how this process turned into a bubble, as more begat more, and then more and more begat more and more and more:

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. . . .

In a nutshell, Fannie and Freddie, acting as Government sponsored enterprises, bought tens of millions of mortgages, and then repackaged them into huge mortgage-backed securities that giant private entities such as Bear Stearns, AIG and Lehman Brothers purchased.  What made these securities particularly attractive to the private banking entities was that these securities were essentially being sold – and had the backing – of the United States government.

Here’s the process:

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.

Now, an intelligent observer would note a conflict: the GSE’s role was to “provide stability,” and yet they were taking on “significantly more risk” in the final year of the Clinton presidency.  What’s wrong with this picture?

The GSEs Fannie Mae and Freddie Mac were designed to bundle up the mortgages into mortgage backed securities and then sell them to the private market.

Fannie Mae is exempt from SEC [Securities and Exchange Commission] regulation. Which screams why Bush wanted to regulate them.  This allowed Fannie Mae to bundle up mortgages, which were then rated AAA with no requirement to make clear what is in the bundle.  Which screams why Bush wanted to regulate them.

This is what has allowed toxic instruments that have been sold across the world.  It also created a situation where money institutions did not know and could not find out whether potential inter-bank business partners were holding these “boiled babies on their books, complete with a golden stamp on the wrapping,” rather than safe instruments.  This then inclined banks to a natural caution, to be wary of lending good money to other banks against these ‘assets’.  And thus banks refused to lend to one another.

John McCain wrote a letter in 2006 urging reform and regulation of the GSEs.  He said:

Congress chartered Fannie and Freddie to provide access to home financing by maintaining liquidity in the secondary mortgage market. Today, almost half of all mortgages in the U.S. are owned or guaranteed by these GSEs. They are mammoth financial institutions with almost $1.5 Trillion of debt outstanding between them. With the fiscal challenges facing us today (deficits, entitlements, pensions and flood insurance), Congress must ask itself who would actually pay this debt if Fannie or Freddie could not?

An of course, they could not pay their debts.  Fannie and Freddie basically went bankrupt and were taken over.  And they took a whopping share of the biggest financial institutions down with them.  Fannie is in the process of devouring nearly 400 billion dollars of bailout money from the American taxpayer.  And now – GREAT GOOGLEY MOOGLEYObama is planning to funnel yet another $800 BILLION through the same Fannie and Freddie who already destroyed us once.

And thus you had a financial disaster created by one William Jefferson Clinton and one Democrat Party.  And now a second act of economic destruction is being planned by Barack Obama.

The 2008 economic collapse that Democrats were elected to fix was itself created by Democrats who will now continue the very policies that created the disaster in the first place.

Democrats then demonized Bush for merely being there when the disaster happened.  When they had created the mess, and when they had refused to allow Bush to do anything to prevent a Democrat-created disaster that he and other Republicans saw coming, but ultimately lacked the courage to stop.

Hypocrite-in-Chief Seeks Line Item Veto He Blocked Bush From Getting

May 25, 2010

This is pretty massive hypocrisy even coming from a world-class hypocrite:

Tuesday, May 25, 2010
Obama asks Hill for line-item veto he once opposed
Stephen Dinan

When President George W. Bush called for a kind of line-item veto four years ago, the top Senate Democrat said it was like getting a “bad sore throat,” and the No. 2 House Democrat called it “a sham.” On Monday, President Obama asked them to reconsider and pass something very similar, for his sake.

With fears of a Greek-style debt collapse roiling a Congress already balking at new spending, the White House on Monday proposed a modified line-item veto that would give the administration another crack at forcing Congress to vote on spending cuts.

But the proposal will have to pass a Congress wary of giving up power over the purse, and would require a reversal by many Democrats who voted against a similar proposal from Mr. Bush.

One who’s already reversed himself is Mr. Obama, who as a senator in 2007 voted along with Sen. Joseph R. Biden Jr., now the vice president, and almost all of the rest of Senate Democrats to filibuster Mr. Bush’s proposal.

The White House said Mr. Obama embraced line-item powers by the time he won the White House, and that times are bad enough that Congress may now be ready to follow his lead.

“The fiscal context has changed as it became necessary to combat a severe economic downturn and as ongoing deficits have become a growing concern,” Peter R. Orszag, Mr. Obama’s budget director, told reporters. “We are hopeful the Congress will enact this legislation because it will help everyone to reduce unnecessary spending.”

He said the new presidential powers could encourage Congress to scrutinize spending bills more carefully, because lawmakers wouldn’t want to be shamed by having their projects singled out.

What is really amazing is the argument that Obama is giving to justify giving him a line-item veto: we’ve got a growing crisis, and the president needs this tool to avert it.

By Obama’s very own reasoning, he and the Democrat Party are fundamentally responsible for the 2008 economic collapse.  Because had they given Bush this power, he could have averted the disaster – but they refused to give him the necessary power he needed.

A couple of quotes from US News & World Report must suffice to illustrate:

Seventeen. That’s how many times, according to this White House statement (hat tip Gateway Pundit), that the Bush administration has called for tighter regulation of the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. […]

But it didn’t prevent them from spewing a huge amount of toxic waste, in the form of subprime and Alt-A mortgages, into our financial institutions from 2004 to 2007. As Stephen Spruiell points out in The Corner on National Review Online, Fannie and Freddie spewed out $1 trillion worth (face value) of subprime mortgages between 2005 and 2007. That’s a whole lot of toxic waste. For more detail, consult the items referred to in my previous blogpost on this subject (most of the comments seem to have been disputes about the plot line of the movie It’s a Wonderful Life, which I should think could be settled by consulting a reference work).

Much if not all of that could have been prevented by a bill cosponsored by John McCain and supported by all the Republicans and opposed by all the Democrats in the Senate Banking Committee in 2005. That bill, which the Democrats stopped from passing, would have prohibited the GSEs from speculating on the mortgage-based securities they packaged. The GSEs’ mission allegedly justifying their quasi-governmental status was to package or securitize such mortgages, but the lion’s share of their profits—which determined top executives’ bonuses—came from speculation.

And there’s your 2008 mortgage meltdown, in a nutshell.  Bush warned and warned and warned about the impending crisis, to no avail.  Because the same Democrats who refused to give Bush the power Obama now says he needs to avert disaster refused to heed Bush’s warnings, and kept pushing us closer and closer and closer to the implosion point.  And then we imploded just as Bush had said we would.

I have always believed that the president should have a line-item veto – with the proviso that every line item veto be made a matter of public record so the American people could know what items the president was removing and who had installed those items in the first place.

This is just another of many, many proofs regarding what a gargantuan hypocrite slimeball the current occupant of the White House truly is.

But, for what it’s worth, it is probably unfair to single out Barack Obama as a slimeball, when so many of his fellow Democrats are also slimeballs.  Near the conclusion of the Washington Times article, we have this:

House Budget Committee Chairman John M. Spratt Jr., South Carolina Democrat, said he will take the lead in introducing Mr. Obama’s proposal in Congress, calling it “a step forward on the path to fiscal responsibility.”

Mr. Spratt led opposition to the 2006 Bush proposal.

At some point they should just call themselves the Demagogue Party and dispense with the pretenses as to what they truly are.