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Mike <M...@l...localhost> wrote without thinking...:
>On Fri, 03 Oct 2008 16:25:58 +0000, Ich bin ein Amerikaner wrote:
>
>> Other rule changes gave Fannie and Freddie extraordinary leverage,
>> allowing them to hold just 2.5% of capital to back their investments,
>> vs. 10% for banks.
>
>
>that's a huge part of the problem, 40x1 leverage which is even worse than
>what the investment banks were doing (30x1) which was already completely
>out of control. so when exactly did that happen & who to blame (dems or
>repubs?)
>
I blame Republicans for not following through on the warnings they
gave on Fannie and Freddie starting on 2001.
I place most of the blame on the Dems because Fannie Mae and Freddie
Mac were creations by Democrats. Fannie Mae was created in 1938 as
part of Franklin Delano Roosevelt's New Deal. In order to prevent any
further monopolization of the market, a second GSE known as Freddie
Mac was created in 1970. Currently, Fannie Mae and Freddie Mac control
about 90 percent of the nation's secondary mortgage market. That's a
government monopoly.
Fannie Mae and Freddie Mac worked with the CRA a Jimmy Carter feel
good legislation.
Fannie Mae and Freddie Mac are the only two Fortune 500 companies that
are not required to inform the public about any financial difficulties
that they may be having. In the event that there was some sort of
financial collapse within either of these companies, U.S. taxpayers
could be held responsible for hundreds of billions of dollars in
outstanding debts.
Any attempt to reform the oversight of Fannie and Freddie were blocked
by Democrats along party lines in committee.
My favorite quote is from Barney Frank when oversight was proposed.
”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.”
===USA===
Justice will be served
And the battle will rage
This big dog will fight
When you rattle his cage
And youll be sorry that you messed with
The U.S. of A.
cause well put a boot in your ass
Its the American way
-Toby Keith, "Courtesy Of The Red, White & Blue"
Robert Blass <b...@m...xcx> wrote without thinking...:
>Republicans protect the wealthy and they are to blame for poverty and
>despair of poor people.
When was the last time a poor person started a new company or gave you
a job?
===USA===
Justice will be served
And the battle will rage
This big dog will fight
When you rattle his cage
And youll be sorry that you messed with
The U.S. of A.
cause well put a boot in your ass
Its the American way
-Toby Keith, "Courtesy Of The Red, White & Blue"
Ich bin ein Amerikaner wrote:
> Mike <M...@l...localhost> wrote without thinking...:
>
>
>> On Fri, 03 Oct 2008 16:25:58 +0000, Ich bin ein Amerikaner wrote:
>>
>>
>>> Other rule changes gave Fannie and Freddie extraordinary leverage,
>>> allowing them to hold just 2.5% of capital to back their investments,
>>> vs. 10% for banks.
>>>
>> that's a huge part of the problem, 40x1 leverage which is even worse than
>> what the investment banks were doing (30x1) which was already completely
>> out of control. so when exactly did that happen & who to blame (dems or
>> repubs?)
>>
>>
> I blame Republicans for not following through on the warnings they
> gave on Fannie and Freddie starting on 2001.
>
> I place most of the blame on the Dems because Fannie Mae and Freddie
> Mac were creations by Democrats. Fannie Mae was created in 1938 as
> part of Franklin Delano Roosevelt's New Deal. In order to prevent any
> further monopolization of the market, a second GSE known as Freddie
> Mac was created in 1970. Currently, Fannie Mae and Freddie Mac control
> about 90 percent of the nation's secondary mortgage market. That's a
> government monopoly.
>
> Fannie Mae and Freddie Mac worked with the CRA a Jimmy Carter feel
> good legislation.
>
> Fannie Mae and Freddie Mac are the only two Fortune 500 companies that
> are not required to inform the public about any financial difficulties
> that they may be having. In the event that there was some sort of
> financial collapse within either of these companies, U.S. taxpayers
> could be held responsible for hundreds of billions of dollars in
> outstanding debts.
>
> Any attempt to reform the oversight of Fannie and Freddie were blocked
> by Democrats along party lines in committee.
>
> My favorite quote is from Barney Frank when oversight was proposed.
>
> "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."
>
>
>
When he said that in 2003 they were not, Bush changed the guide lines to
force both to make risky loans
the speech is available.
Ich bin ein Amerikaner wrote:
>Robert Blass <b...@m...xcx> wrote without thinking...:
>
>
>
>>Republicans protect the wealthy and they are to blame for poverty and
>>despair of poor people.
>>
>>
>
>When was the last time a poor person started a new company or gave you
>a job?
>
>
>
>
That's quite odd considering the number of jobs have continually
declined ever since Bush sent all the tax payer money to the wealthy.
Maybe the money needs to go to the middle class to create demand. The
wealthy are certainly not creating jobs with their new found wealth.
clams_casino <P...@D...com> wrote without
thinking...:
>Ich bin ein Amerikaner wrote:
>
>>Robert Blass <b...@m...xcx> wrote without thinking...:
>>
>>
>>
>>>Republicans protect the wealthy and they are to blame for poverty and
>>>despair of poor people.
>>>
>>>
>>
>>When was the last time a poor person started a new company or gave you
>>a job?
>>
>>
>>
>>
>
>That's quite odd considering the number of jobs have continually
>declined ever since Bush sent all the tax payer money to the wealthy.
Explain how that happens?
>
>Maybe the money needs to go to the middle class to create demand. The
>wealthy are certainly not creating jobs with their new found wealth.
Where will the money you want to give to the middle class come from?
===USA===
Justice will be served
And the battle will rage
This big dog will fight
When you rattle his cage
And youll be sorry that you messed with
The U.S. of A.
cause well put a boot in your ass
Its the American way
-Toby Keith, "Courtesy Of The Red, White & Blue"
Ich bin ein Amerikaner wrote:
> clams_casino <P...@D...com> wrote without
> thinking...:
>
>
>> Ich bin ein Amerikaner wrote:
>>
>>
>>> Robert Blass <b...@m...xcx> wrote without thinking...:
>>>
>>>
>>>
>>>
>>>> Republicans protect the wealthy and they are to blame for poverty and
>>>> despair of poor people.
>>>>
>>>>
>>>>
>>> When was the last time a poor person started a new company or gave you
>>> a job?
>>>
>>>
>>>
>>>
>>>
Actually the majority of people employed work for small business. Small
businesses employ almost exactly
half the private U.S. labor force of about 153 million. In 2003 the
average small business had one location
and 10 employees. Of the nearly 26 million firms in the United States,
97.5 percent have fewer than 20
employees. Very few of these small business men are what one would
consider rich, 98.1% percent of
small-business filers have income too low to be subject to either of the
top two tax rates.
HiC wrote:
> 700 billion of the taxpayer's money give or take to bail out these
> supposedly public sector enterprises. So, what about the officers and
> boards of directors of these various firms who were ultimately
> responsible for the decisions that caused the problems? Theoreticaly
> these are the people who bear the weight of responsibility for these
> firms, isn't that why they're supposedly in these positions - and
> getting the big payday?
>
> They're asking you and me to foot the bill, what are they who have
> been profiting the most going to forfeit?
In some cases, the CEOs were required to resign their positions. And as
I understand it, the bailout bill prevents them from receiving any
"golden parachutes." So they won't get attractive severance packages.
And you and I are *NOT* going to "foot the bill" in the long term.
Sooner or later (probably later), the housing market will bottom out and
begin a new bull market in real estate. Then these mortgage-based
securities that the Fed bought will appreciate rapidly in value (because
they're leveraged). So who knows, you and I may even get a tax break
from the profits from those deals.
What the Fed is doing, is buying up all these assets that nobody else
wants to buy right now because the housing market is still sinking. The
Fed has the money and the power to be patient and wait for the housing
market to turn around.
--
Steven L.
Email: s...@e...net
Remove the NOSPAM before replying to me.
Steven L. wrote:
> HiC wrote:
>> 700 billion of the taxpayer's money give or take to bail out these
>> supposedly public sector enterprises. So, what about the officers and
>> boards of directors of these various firms who were ultimately
>> responsible for the decisions that caused the problems? Theoreticaly
>> these are the people who bear the weight of responsibility for these
>> firms, isn't that why they're supposedly in these positions - and
>> getting the big payday?
>>
>> They're asking you and me to foot the bill, what are they who have
>> been profiting the most going to forfeit?
>
> In some cases, the CEOs were required to resign their positions. And as
> I understand it, the bailout bill prevents them from receiving any
> "golden parachutes." So they won't get attractive severance packages.
>
> And you and I are *NOT* going to "foot the bill" in the long term.
> Sooner or later (probably later), the housing market will bottom out and
> begin a new bull market in real estate. Then these mortgage-based
> securities that the Fed bought will appreciate rapidly in value (because
> they're leveraged). So who knows, you and I may even get a tax break
> from the profits from those deals.
>
> What the Fed is doing, is buying up all these assets that nobody else
> wants to buy right now because the housing market is still sinking. The
> Fed has the money and the power to be patient and wait for the housing
> market to turn around.
Oops, I meant the Treasury Dept. not the Fed. Sorry.
--
Steven L.
Email: s...@e...net
Remove the NOSPAM before replying to me.
"Steven L." <s...@e...net> wrote in message
news:eomdnRANnZMWk3XVnZ2dnUVZ_tCdnZ2d@earthlink.com.
..
> HiC wrote:
>> 700 billion of the taxpayer's money give or take to bail out these
>> supposedly public sector enterprises. So, what about the officers and
>> boards of directors of these various firms who were ultimately
>> responsible for the decisions that caused the problems? Theoreticaly
>> these are the people who bear the weight of responsibility for these
>> firms, isn't that why they're supposedly in these positions - and
>> getting the big payday?
>>
>> They're asking you and me to foot the bill, what are they who have
>> been profiting the most going to forfeit?
>
> In some cases, the CEOs were required to resign their positions. And as I
> understand it, the bailout bill prevents them from receiving any "golden
> parachutes." So they won't get attractive severance packages.
>
> And you and I are *NOT* going to "foot the bill" in the long term. Sooner
> or later (probably later), the housing market will bottom out and begin a
> new bull market in real estate. Then these mortgage-based securities that
> the Fed bought will appreciate rapidly in value (because they're
> leveraged). So who knows, you and I may even get a tax break from the
> profits from those deals.
>
> What the Fed is doing, is buying up all these assets that nobody else
> wants to buy right now because the housing market is still sinking. The
> Fed has the money and the power to be patient and wait for the housing
> market to turn around.
If these are such good investments you wouldn't think we'd have to put a gun
to Congress' head to get them to buy them. They should sell themselves.
Have you bought any?
-herb
Balanced View <N...@n...net> wrote without thinking...:
>Ich bin ein Amerikaner wrote:
>> clams_casino <P...@D...com> wrote without
>> thinking...:
>>
>>
>>> Ich bin ein Amerikaner wrote:
>>>
>>>
>>>> Robert Blass <b...@m...xcx> wrote without thinking...:
>>>>
>>>>
>>>>
>>>>
>>>>> Republicans protect the wealthy and they are to blame for poverty and
>>>>> despair of poor people.
>>>>>
>>>>>
>>>>>
>>>> When was the last time a poor person started a new company or gave you
>>>> a job?
>>>>
>>>>
>>>>
>>>>
>>>>
>
>Actually the majority of people employed work for small business. Small
>businesses employ almost exactly
>half the private U.S. labor force of about 153 million. In 2003 the
>average small business had one location
>and 10 employees. Of the nearly 26 million firms in the United States,
>97.5 percent have fewer than 20
>employees. Very few of these small business men are what one would
>consider rich, 98.1% percent of
>small-business filers have income too low to be subject to either of the
>top two tax rates.
Small businesses employs just over half of the workforce in America.
The Small Business Administration defines small business as low as
$750,000 in annual sales and in other cases as high as $28.5 million.
In other cases, it's based upon the number of employees, sometimes 100
or less, but in other cases up to 1,500 or fewer employees.
Proprietorship – business owned and operated by one person
74% of all USA businesses
Accounts for 6% of all sales in USA
Partnership - business owned and operated by two or more people
8% of all USA businesses
Accounts for 4% of all sales in USA
Corporation - business owned by stockholders/investors but operated by
officers
18% of all USA businesses
Accounts for 90% of all sales in USA
Judging from the info I have just given, it is those big corporations
that keep this economy going.
The financial difficulties this country is going through is not the
fault of big business except for one factor, government's involvement.
You can say this problem started with FDR. Fannie Mae came into
existence as part of the New Deal. Fannie Mae and Freddie Mac were
Government Sponsored Enterprises (GSE's) that nationalized a good
portion of the subprime mortgage market. Fannie Mae and Freddie Mac
have access to a guaranteed line of credit of $2.25 billion with the
U.S. treasury.
Another component to this financial mess was also due to government
intervention was the CRA that came out of the Jimmy Carter
administration.
The roots of the sub-prime loan problem lie in decreased underwriting
standards brought about by the Community Redevelopment Act, social
activism, and government pressure on banks and lending institutions to
make loans to minorities and low income wage earners in large
numbers. The enhancement to the CRA by Bill Clinton encouraged lenders
to take on more risky loans and many of them without a down payment
which made it easy to abandon a property like a renter abandons his
apartment.
Franklin Raines and his fellow executives at Fannie Mae bought these
risky loans because they considered it as an asset which affected
their bonuses.
Money getting tighter due to high energy costs made many of those
people who had a subprime mortgages to default.
Franklin Raines and the other executives at Fannie Mae and Freddie Mac
did an Enron without consequence.
Poor people are poor because of factors that had nothing to do with
wealthy Americans. Liberals argue tax cuts for the rich prevents them
to distribute income more evenly between rich and poor. Tax cuts are
actually bringing more fairness to the tax system. The top 1 percent
of income earners, by household, paid 39 percent of all federal income
taxes in 2005, whereas the bottom 50 percent paid a little over 3
percent. Further, 32 percent of all tax returns filed in 2005 were
from people who paid no federal income tax at all.
===USA===
Justice will be served
And the battle will rage
This big dog will fight
When you rattle his cage
And youll be sorry that you messed with
The U.S. of A.
cause well put a boot in your ass
Its the American way
-Toby Keith, "Courtesy Of The Red, White & Blue"
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