Click on picture for easier reading.

Thank you, Calvin, George. Now, go away.

"This Was Never About the Little Guy" (guest post)

There were approximtely $1.4 trillion worth of subprime loans outstanding in the United States by the end of 2007. By the first quarter of 2009, there were forclosure filings against approximately 4.4 million properties. If it was only the subprime market's fault, $1.4 trillion would have covered the entire problem, right?

Yet the Federal Reserve, the treasury, and the FDIC forked out $13 trillion to fix the housing “correction”… With all that money, the government could have bought up every residential mortgage in the country – there were about $11.9 trillion  worth at the end of December 2008 – and still have had about a trillion left over to buy homes for every American who couldn’t afford them.

--Nomi Prin, former VP at Goldman Sachs from her book It Takes a Pillage: Behind the Bailouts, Bonuses, and Backroom Deals from Washington to Wall Street  (with thanks for the reference to Matt Taibbi of Rolling Stone Magazine).  Ms. Prin "frequently makes the point that the bailouts were more about paying off bets than they were about stabilizing the economy."

We've been had as chumps.

Try to have a great weekend, y'all.

Links:  http://www.rollingstone.com/politics/blogs/taibblog/mailbag-friedman-naked-swaps-and-madoff-20110228

http://www.nomiprins.com/it-takes-a-pillage/

More good things from this White House

Notice came yesterday from the US House of Representatives that a new agency is finally being created to "regulate home loans, credit cards, savings accounts and other financial services."

The agency is to be called the Consumer Financial Protection Agency.

Let's hope it has some teeth and can do its job and do it well.

It's unfortunate, I think, that we need this additional function in our government and yet another new agency but I think it's important we do, indeed have it.

If we learned anything from the last couple of years, it's what can happen when business isn't regulated so out-and-out theft doesn't occur under the heading of "business as usual."

Considering what's happened to our banking, mortgage and credit sectors and what literally thousands of unscrupulous lenders did, first to their clients and then, ultimately, to our economy, what with our banking and credit crisis and collapse, it seems incredible anyone could voice any complaint about it.

But the bankers and business sector is, let there be no doubt.

The thing is, we need to get the banking and insurance (and all other corporations and their lobbyists and money) out of our government.

And the only way to do that is to have true, complete, bold, in-your-face campaign finance reform, with the corporations thrown out of both the process and ultimate legislative product.

But the American people, sadly, don't connect those dots.

Until that happens, until we all truly revolt for this result, it will remain more of the same, regardless of the political party in power.

There are two things about this, though, that are worth noting--one a question, the other an observation:

First, it would be good to know if this important work couldn't be done within an existing agency, like Commerce or something, so we don't create yet another bureaucracy that ends up living for it's own success.

Second, unfortunately, it's not a sure thing that this consumer protection agency will be created. Bankers and their money being what they are--and our government being how it is, subject to yet more lobbyist's money, etc.--this may not get out of Congress. It's too early to tell.

Sure, we're doing somewhat better now, as citizens and consumers, with this Administration and political party, compared to the previous one but we won't have that true, complete reform unless and until we all push mightily for said campaign finance reform.

That's the only thing that will finally get all the ugly money out of our government that is corrupting the officials, the process and the ultimate legislation.

God, I miss Molly Ivins.

Link:
http://hosted.ap.org/dynamic/stories/U/US_FINANCIAL_OVERHAUL?SITE=TXMCA&SECTION=HOME&TEMPLATE=DEFAULT
http://hosted.ap.org/dynamic/stories/U/US_SHRINKING_FINANCIAL_OVERHAUL_ANALYSIS?SITE=TXMCA&SECTION=HOME&TEMPLATE=DEFAULT

Important column from another blogger

Friday, January 16, 2009

Most Galling Statement Of The Week

Nominations are being accepted for the most galling statement of the week. Here is my nomination: White House Sees 'Strong' Econ Recovery Early In Obama Admin.

The Bush administration said the U.S. economy should emerge from its slump in the second half of the year - an optimistic forecast released days before President-elect Barack Obama inherits a recession and mammoth budget deficit.

"The actions taken by my administration in response to the financial crisis have laid the groundwork for a return to economic growth and job creation, and they are beginning to show some early results," President George W. Bush said in a letter to Congress that accompanied the annual Economic Report of the President.

The report, prepared by the White House's Council of Economic Advisers, says economic growth should be an anemic 0.6% this year after contracting 0.2% in 2008. The contraction is seen continuing in the first half of the year before growth resumes in the second half. For 2010 and 2011, the White House projects growth of 5.0%.

Reflecting the current drop in GDP, the White House said it expects the unemployment rate to rise to an average rate of 7.7% this year.

"The magnitude of the crisis required unprecedented policy responses to reduce the extent of the damage to the economy," the report said. "These policy actions have laid a foundation for a strong economic recovery early in the term of the next administration."

The White House's report is rosier than most other projections. Last week, the Congressional Budget Office forecast a 2.2% contraction in 2009, a performance that would mark the worst year since World War II. CBO expects the U.S. unemployment rate to peak at around 9% in 2010.

Bush is attempting to take credit for a recovery that has not happened yet, and in fact will not happen at all. His entire eight year term has consisted of nothing but lies, distortions, wasted money, failures to address natural disaster like Katrina, an unfounded war on trumped up lies, trampling of human rights, trampling the constitution, and policy decisions that helped sink the economy.

There is not a single major thing Bush did right, and hundreds of things he did wrong including this ridiculous attempt to take credit for a bailout plan that has clearly failed.

Bush is the epitome of arrogance, gall, stubbornness, and stupidity all wrapped up in a single package. He will go down in history as one of the all time worst presidents. Ironically, the gall of his statements today will help seal that fate, so perhaps we should be thankful for them.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
_________________________________________________

I couldn't have said it better myself.

Thanks, Mish.

"EVERYONE REMAIN CALM!!!"

You know what kills me?

For the last 2 weeks, first from "Hank" Paulson, then the White House and always from Wall Street, we've heard nothing but that, basically, we're all going to hell in a handbasket and/but "if you give us this 700 billion dollars, real fast and no questions asked, we'll be okay. But if you don't, it's going to be horrible," in a nutshell.

So they pushed through a nightmare bill and it died. Since Wall Street didn't get it's Christmas package, it got pissed off and slashed 777 points off the Dow. "We'll show you!", right?

So now, after all the threats, here we go. It looks like the House of Representatives is going to buckle and give them all this money. Sure, they put in a few little concessions--and millions of dollars of treats in the form of yet more earmarks for themselves and their friends--and they're going to get their boondoggle bailout.

Really, who can tell if this is really necessary or if this is the best way to do this? Sure, it seems we need more liquidity in the credit markets but is this the path to take? No one in power seems to be asking this or any other questions (thought we certainly hope they are, of course, and not just "what's in it for me?").

With all that going on, what we're just about to hear, then, out of Washington and from everyone who has their hands on this bill is that "There, that ought to do it." Tomorrow, once this is passed, we're going to hear everyone in Washington and government say "Okay, it's all better now. Be calm. Go back about your business. Spend money. Procreate. Do what it is you do."

Mark my words.

Again, for the past 2 weeks, we've heard nothing but how things are going straight to hell, with only a little exaggeration here, but tomorrow, once this passes, they're going to insist everything's fine and that we should all calm down.

Are you kidding me?

They've done nothing--from the President to Paulson to other government officials--but scream about everything but a 2nd Great Depression (after all, they don't wanna panic us), and all of a sudden it's going to be "okay, it's all fixed."

My point?

This whole thing has been so badly managed and mismanaged, once again, by this Bush Administration that it's almost giving the American people whiplash in it's messages.

The American people have been going about their business, going to work, paying taxes, etc., while people are almost talking about financial endtimes and then it'll be all "calm down", "take it easy".

While irresponsiblity and ineptitude has just been considered the norm for this group in the White House, it seems to me they've outdone themselves this time--this one, last time, before the Knucklehead is out of office next January.

This is just no way to run a government and country.

If you EVER voted for George W. Bush, even once, WE BLAME YOU.