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Posts Tagged ‘Fannie Mae Freddie Mac Bailout

Fed to pump another $1 trillion into U.S. economy

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Washington: The Federal Reserve sharply stepped up its efforts to bolster the economy on Wednesday, announcing that it would pump an extra $1 trillion into the financial system by purchasing Treasury bonds and mortgage securities.

Having already reduced the key interest rate it controls nearly to zero, the central bank has increasingly turned to alternatives like buying securities as a way of getting more dollars into the economy, a tactic that amounts to creating vast new sums of money out of thin air. But the moves on Wednesday were its biggest yet, almost doubling all of the Fed’s measures in the last year.

The action makes the Fed a buyer of long-term government bonds rather than the short-term debt that it typically buys and sells to help control the money supply.

The idea was to encourage more economic activity by lowering interest rates, including those on home loans, and to help the financial system as it struggles under the crushing weight of bad loans and poor investments.”

Full story here.

ED:

Treasury monetizes debt by printing 1 trillion dollars to inject into economy – effectively borrowing from itself.

Taking such a measure this drastic means the “patient” is almost dead and this “injection” is a last ditch effort to save it.

Written by Ben

March 22, 2009 at 7:38 pm

Who benefits from this meltdown?

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Since 1989, Rep. Frank has received $42,350 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Senator Reid has received $77,000 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Sen. Dodd has received $165,400 from Fannie Mae and Freddie Mac, more than any other Member of Congress. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Sen. Carper has received $55,889 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

In just four years, Sen. Barack Obama (D-IL) has received $126,349 from Fannie Mae and Freddie Mac, more than any Member of Congress except for Sen. Dodd. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Sen. John Kerry (D-MA) has received $111,000 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Sen. Hillary Clinton (D-NY) has received $76,050 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, House Speaker Nancy Pelosi (D-CA) has received $56,250 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Since 1989, Rep. Rahm Emanuel (D-IL) has received $51,750 from Fannie Mae and Freddie Mac. (Lindsay Renick Mayer, “Fannie Mae And Freddie Mac Invest In Lawmakers,” Center For Responsive Politics’ “Capital Eye” Blog, www.opensecrets.org)

Former Fannie Mae, Freddie Mac Executives Ignored Warnings

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(AP – Tuesday, December 09, 2008)

WASHINGTON–Top executives at mortgage finance companies Fannie Mae and Freddie Mac ignored warnings that they were taking on too many risky loans long before the housing market plunged, according to documents released Tuesday by a House committee.

E-mails and other internal documents released by the House Oversight and Government Reform Committee show that former Fannie CEO Daniel Mudd and former Freddie Mac CEO Richard Syron disregarded recommendations that they stay away from riskier types of loans.

“Their own risk managers raised warning after warning about the dangers of investing heavily in the subprime and alternative mortgage market. But these warnings were ignored” by the two chief executives, said Rep. Henry Waxman, D-Calif., the committee’s chairman. “Their irresponsible decisions are now costing the taxpayers billions of dollars.”

The two companies were seized by government regulators in September. A month later, Freddie Mac asked for an injection of $13.8 billion in government aid after posting a massive quarterly loss. Fannie Mae has yet to request any government aid but has warned it may need to do so soon.

Lawmakers questioned Mudd about an internal Fannie Mae presentation from June 2005 that showed the company at a “strategic crossroads,” at which it could either delve into riskier loans or focus on more secure ones.

Questioned about the presentation, Mudd defended his company’s effort to compete against Wall Street banks that were pouring money into subprime and other exotic loans.

“We couldn’t afford to make the bet that the changes were not going to be permanent,” Mudd said.

Mudd and three other former executives of the two companies defended their stewardship in a hearing held by the House committee.

“It’s important to remember that Freddie and its sister institution, Fannie Mae, did not create the subprime market,” said Richard Syron, Freddie Mac’s former CEO.

But Rep. Darrell Issa, R. Calif., blasted Syron and Mudd, along with former Fannie Mae CEO Franklin Raines, and former Freddie Mac CEO Leland Brendsel.

“All four of you seem to be in complete denial that Freddie and Fannie are in any way responsible for this. Your whole excuse for going to risky and unreasonable loans that are defaulting at an incredibly high rate is that everyone is doing it. If we don’t do it, we’ll be left out.”

Fannie and Freddie own or guarantee around half the $11.5 trillion in U.S. outstanding home loan debt. The two companies are the engines behind a complex process of buying, bundling and selling mortgages as investments.

They traditionally backed the safest loans, 30-year fixed rate mortgages that required a down payment of at least 20 percent. But in recent years, they lowered their standards, matching a decline fueled by Wall Street banks that backed the now-defunct subprime lending industry.

Republicans blame Fannie and Freddie, and homeownership policies of the Clinton administration for sowing the seeds of the financial meltdown. Democrats defend the companies’ role in encouraging homeownership and stress that Wall Street banks — not Fannie and Freddie — led the dramatic decline in lending standards.

For years the two companies flexed their lobbying muscle in Washington to thwart efforts to impose tighter regulation.

Internal Freddie Mac budget records obtained by The Associated Press show $11.7 million was paid to 52 outside lobbyists and consultants in 2006. Power brokers such as former House Speaker Newt Gingrich and former Sen. Alfonse D’Amato of New York were recruited with six-figure contracts.

The more difficult questions, however, will come next year, when lawmakers weigh what role, if any, the two companies play should play in the mortgage market.

Options include taking the companies private, morphing them into a public utility or a federal agency, or leaving them as government-sponsored entities that have private shareholders and profits, with tougher regulations.

A watershed moment

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Clinton signs banking overhaul measure

November 12, 1999

WASHINGTON (CNN) — The biggest change in the nation’s banking system since the Great Depression became law Friday, when President Bill Clinton signed a measure overhauling federal rules governing the way financial institutions operate.

“This legislation is truly historic and it indicates what can happen when Republicans and Democrats work together in a spirit of genuine cooperation,” Clinton said at a White House signing ceremony. The event brought together the president and several Republican members of Congress who have been among Clinton’s sternest critics — a sign of the bipartisan support that eventually developed for the package.

Congress passed the bipartisan measure November 5, opening the way for a blossoming of financial “supermarkets” selling loans, investments and insurance. Proponents had pushed the legislation in Congress for two decades, and Wall Street and the banking and insurance industries had poured millions of dollars into lobbying for it in the past few years.

“The world changes, and Congress and the laws have to change with it,” said Senate Banking Committee Chairman Phil Gramm (R-Texas), who has fought for years for the overhaul. Gramm said the bill would improve banking competition and stability.

“This is a bill that is bipartisan, bicameral and tri-institutional,” said Rep. Jim Leach (R-Iowa), chairman of the House Banking and Financial Services Committee. He noted that the House, Senate and White House had worked together on the compromise that became law.

Clinton said the measure will “save consumers billions of dollars a year through enhanced competition.” He said it also would protect consumers’ rights and require banks to expand the availability of funds for community development.

At stake is an estimated $350 billion that Americans spend annually on fees and commissions for banking, brokerage and insurance services. Proponents say the legislation will save consumers some $15 billion each year, offering them greater choice and convenience and spurring competition. Consumer groups and other opponents maintain it will bring higher prices and jeopardize consumers’ financial privacy.

The overhaul measure is one of the few major pieces of bipartisan legislation to emerge from the Republican-controlled Congress this year.

Clinton’s support for the legislation comes despite warnings from Democratic critics and consumer activists that it could lead to price-gouging of consumers and the erosion of their privacy by newly formed financial conglomerates that are too big and powerful.

“The bill is anti-consumer and anti-community,” advocate Ralph Nader declared. “It will mean higher prices and fewer choices for low-, moderate- and middle-income families across the nation.”

In addition, he said, “Personal privacy will be virtually eliminated” under provisions allowing affiliated businesses of the newly merged companies to share customers’ personal financial data as they offer one-stop shopping.

And up until a few weeks ago, the Clinton Administration itself had threatened a veto of the legislation as it took various forms that raised a series of White House objections. In recent months, the administration objected most sharply to the issue of rules requiring that banks make loans in minority and low-income communities where they operate.

Gramm, an outspoken conservative who opposes the rules, last year managed to kill a similar bill that would have overhauled the community lending laws. The White House insisted that banks be required to have a strong track record in local loan-making as a condition for being allowed to expand into other financial activities.

The big breakthrough came in the wee hours of October 22 when administration officials — including Treasury Secretary Lawrence Summers — and key Republican lawmakers reached a compromise after negotiating for days behind closed doors. The White House then lifted its longstanding veto threat.

“It was sweaty, it was tense, but it had momentum,” Sen. Charles Schumer (D-New York) said of the final bargaining session. He and Sen. Christopher Dodd (D-Connecticut) whose states are home to Wall Street and the banking industry (New York) and the insurance industry (Connecticut), helped broker the agreement.

Dodd: General Motors Executive Should Resign in Exchange for Bailout

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Sen. Chris Dodd called on the CEO of General Motors to be replaced if the auto company is to receive any bailout money from the federal government.

U.S. Senate Banking Committee Chairman Chris Dodd called on a top auto executive to resign in exchange for bailout money from the federal government.

Dodd said General Motors’ chief executive officer Rick Wagoner — who has been with GM since 1977 — should be replaced if the faltering auto company is to receive any money from the government.

“I think he has to move on,” the Democratic senator said of Wagoner during an interview Sunday on CBS’ “Face the Nation.”

“If you are really going to restructure this, you’ve got to bring in a new team to do this,” he said.

Dodd also said he is hopeful Congress will pass a short-term $15 billion aid package for the automakers in the next several days. But the Connecticut Democrat says the companies should have to restructure if they want a more significant bailout from Congress next year.

He added that the companies need quick cash to avoid collapse in the next several weeks. But over the long-term, Dodd said Chrysler probably ought to merge with another company.

Dodd said Ford is the healthiest of the Big Three U.S. automakers.

—-

ED:

If Dodd’s reasoning for calling upon a top auto executive to resign his position as head of a faltering company rests on claims of mismanagement, incompetency, dereliction of duty, lack of vision, failing to accurately gauge and correct failed policies, then for the same reasons Dodd should likewise resign his position as Chairman of the Senate Banking Committee.

Dodd’s leadership and failed policies for Fannie Mae and Freddie Mac served to usher in the credit debacle tax-payers are to pay for.

In my opinion, both Dodd and Barney Frank are at the top of the pyramid and both should be the first in the long line of many Democrats (please give me a name of a Republican – an no, Bush does not count) to be removed from office.

If Dodd wants accountability from auto company leadership we should all be screaming from the mountain tops for Dodd’s and Frank’s heads.

We should show no mercy two years from now.

Why haven’t we seen heads roll?

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When working Americans act irresponsibly with their finances and fall behind on their rent/mortgage, credit card payments we have to answer to our lenders. If we cannot pay, our collateral is seized and our homes are foreclosed and we use whatever resources we have left to start over. That sounds, fair doesn’t it? Personal responsibility and accountability are the key components there.

Not so for the banks. Not so for Fannie Mae and Freddie Mac, Government Sponsored Enterprises. They appear to be operating under a different set of rules. There doesn’t seem to be accountability whatsoever. I haven’t seen a single CEO fired or a single polititian lose their seat on a single board. There’s something wrong with that.

As all of these recent events slowly unfold, we are getting conditioned to the idea that when companies act irresponsibly and wreak them as we have seen, all we have to do is to look to the national treasury for the bailout. In the case of the banking industry, there are few options. They cannot declare bankruptcy and have the world fall into a depression scenario.

But in the case of the auto industry, we seem to believe the solution to their problem is also in the national treasury They appear to believe that since the banks are getting a bailout, why not them, too.

The message we send to these industries is clear and not healthy for our economy. In the process, we are certainly well on our way to a socialist society with government owning industry.

So who do we blame? Who should we hold responsible? Who is accountable? Who should pay?

Why haven’t we seen heads roll?

The scary part about the recovery plan for the auto industry is in Nancy Pelosi’s plan; save the unions. Truth is, the unions are a large component to the problem.

I read a story at the site of a famous journal which described the efforts of one auto company demonstrating innovation and vision by designing a plan that positioned the company to offer state-of-the-art autos using an alternate energy source. The plan to build these autos would be put into effect once gas prices became high enough. The trouble was that the execs couldn’t figure out how to make money with the plan. The production costs where too high. The main problem was that before the production line even rolls, there is a $5000 to $6000 cost associated with benefits demanded by the unions.

These are the same execs who agreed to the labor union’s demands and signed the labor contract.

CEO Bludgeoned to Death in India by Fired Employees (Can Barney Frank be next please?)

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This story ran in late September 2008, but I find it even more relevant today than before.  You can take the title above as is and perform a search and the story will come up.  The opening couple of paragraphs read as:

Corporate India is in shock after a mob of recently fired workers bludgeoned to death the chief executive who had dismissed them from a factory in a suburb of Delhi.

Lalit Kishore Choudhary, 47, the head of the Indian operations of Graziano Transmissioni, an Italy-based manufacturer of car parts, died of severe head wounds Monday afternoon after being attacked by scores of laid-off employees, police said.

That could be your chosen CEO getting his/her just due.

That could be your chosen CEO or even your representative or senator getting his/her just due.

Back in the ’90s and during the opening years of 2000, the United States, and the world, too, no doubt, outsourced just about anything it could.

With the GSE meltdown,  the subsequent drop in everyone’s 401K and watching some CEOs walk away from their orchestrated fiasco with millions of dollars in bonuses, to say sentiment in the U.S. toward these events and CEOs is disgusting falls a bit short of accuracy.

I wonder if the U.S. can outsource CEO flogging to India.  I feel pretty confident saying we probably have a pent-up demand right now.

My first nominee would be Barney Frank, but something tells me he would actually like it and scream like a little girl.

Just a thought.

Written by Ben

October 6, 2008 at 5:49 pm

Barney Frank screws Director at Fannie Mae, then the rest of us.

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…  an alternate title might be …

Barney Frank and boyfriend Herb Moses, executive at Fanne Mae, are just the tip of the iceberg of a larger underlying problem.

From this article we learn that Representative Barney Frank, (D-Mass.) who is a homosexual (the term “Gay” is subversion to make the behavior palletable to the rest of us) had a boyfriend who worked at Fannie Mae. If his boyfriend, Herb Moses, worked in the mail-room that relationship might be overlooked, but Frank’s boyfriend was Director of Housing Initiatives at Fannie Mae from 1991 to 1998, when Frank was on the House Banking Committee, which had jurisdiction over Fannie Mae.

The article states

Both Frank and Moses assured the Wall Street Journal in 1992 that they took pains to avoid any conflicts of interest. Critics, however, remain skeptical.

“It’s absolutely a conflict,” said Dan Gainor, vice president of the Business & Media Institute. “He was voting on Fannie Mae at a time when he was involved with a Fannie Mae executive. How is that not germane?

“If this had been his ex-wife and he was Republican, I would bet every penny I have – or at least what’s not in the stock market – that this would be considered germane,” added Gainor, a T. Boone Pickens Fellow. “But everybody wants to avoid it because he’s gay. It’s the quintessential double standard.”

Now, we have a lot of things to be angry about. If you’re fuming and can’t think straight right now, I’ll highlight them for you, since I’ve had a little time to stop the bleeding from my eyeballs.

  1. There is Barney Frank himself just because he is the way he is.
  2. There is his behavior while he is being himself.
  3. There is his lack of scruples and ethics (covered that, I know), engaging in questionable behavior with the head of a government body he and his committee preside over.
  4. There is the media, all too willing to give Democrats a pass while those Democrats screw heads of Fannie Mae and by extension, the rest of us.

For those who are now regaining their normal blood pressure and the tunnel vision fades away, you might have a few questions.   Some of them might even be among the following list.

  1. Does anyone see a problem with our media?
  2. Is the media blind?
  3. Is the media – ABC, CBS, CNN, MSNBC, NBC, New York Times, Washington Post, San Francisco Chronicle, Public Broadcasting System et. al. – so busy advancing the agenda of the Democrat Party and its socialist leaning value systems that the media in the U.S. are incapable of showing America how these socialist policies – some of which are represented by the very existance of Fannie Mae and Freddie Mac – are a failure to the people and the country as a whole?
  4. Is the media in bed with the Democrat Party?
  5. Does the Democrat Party also have influence over the media just as they have over Fannie Mae and Freddie Mac?

Think about this the next time you’re waiting in line at the check-out counter at the grocery store as you ponder the cover of the National Inquirer.  Think about the pablum the media wants to feed us. Think about who is directing our (voting public) attention.

Better yet, just think.

Then go vote every one of those sons of bitches out of office this November.  If we do not do this, we deserve what we get, just as we have been getting for decades.  Send a ripple through the psyche of America in the process, too.

Just do it.

Are GSEs Constitutional? (Probably, but perhaps they shouldn’t be)

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I singled-out the paragraph below which comes from The Wall Street Journal online edition entitled “Fannie Mae’s Patron Saint” which talks about Barney Frank.

By early 2007, Mr. Frank was in charge of the House Financial Services Committee, arguing that he had long favored some kind of reform. “What blocked it [reform] last year,” Mr. Frank said then, “was the insistence of some economic conservative fundamentalists in the Bush Administration who, to be honest, don’t think there should be a Fannie Mae or a Freddie Mac.” What really blocked it was Mr. Frank’s insistence that any reform be watered down and not include any reduction in their MBS holdings.

The 30,000 foot question I have is this; Why is the U.S. government in the business of being in business, creating so called Government Sponsored Enterprises (GSE)? My untrained-wanna-be-Constitution-law-brain wants to call that activity “unconstitutional”, but hey, I’m just a stoo-pid U.S. tax payer.

Here’s my other concern; Throughout the evolution of the Republican’s and others’ efforts to bring oversight into the business practices and policies of Fannie Mae and Freddie Mac, the likes of Barney Frank and his ilk continually defended the GSEs. The glaring problem? They hold no expertise or qualifications as accountants or financial analysts to allow them to espouse binding opinions about the health of these GSEs.  In fact – in a court of law – their so-called “expert” opinions would not be admissible. Yet we allow their opinions to trump the wisdom and insight of others who do.

My country is upside-down.

Written by Ben

October 3, 2008 at 6:35 pm

Democrat quotes about the health of Fannie Mae and Freddie Mac

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Article and video can be seen at the Wall Street Journal web site

Take a deep breath and read some of the excerpts below. If it is upsetting to you, it should be.

Rep. Maxine Waters (D-Calif.): “Through nearly a dozen hearings, where frankly we are trying to fix something that wasn’t broke, Mr. Chairman, we do not have a crisis at Freddie Mac and in particular at Fannie Mae under the outstanding leadership of Mr. Frank Raines.”

Rep. Maxine Waters (D., Calif.): “Mr. Chairman, we do not have a crisis at Freddie Mac, and in particular at Fannie Mae, under the outstanding leadership of Mr. Frank Raines. Everything in the 1992 act has worked just fine. In fact, the GSEs have exceeded their housing goals.”

Rep. Gregory Meeks (D-NY): In a hearing several years ago about a report on the safety and soundness of Fannie Mae and Freddie Mac from their regulator, Armando Falcon, Federal Housing Enterprise Oversight Director, Falcon came under fire. Meeks said; “The GSEs have done a tremendous job. There has been nothing that was indicated that’s wrong with Fannie Mae, Freddie Mac has come up on its own,” adding the regulator was trying to give the two a “heart surgeon [sic] when they really don’t need it.”

Rep. Barney Frank (D., Mass.): “The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities [Fannie Mae and Freddie Mac] that are fundamentally sound financially and withstand some of the disaster scenarios.”

Rep. Barney Frank (D-Mass.): In the same hearing several years ago about a report on the safety and soundness of Fannie Mae and Freddie Mac from their regulator, Falcon, Frank attacked Falcon: “I don’t see anything in your report that raises safety and soundness problems.”

Sen. Christopher Dodd (D., Conn.): “I, just briefly will say, Mr. Chairman, obviously, like most of us here, this is one of the great success stories of all time.”

Sen. Charles Schumer (D., N.Y.): “And my worry is that we’re using the recent safety and soundness concerns, particularly with Freddie, and with a poor regulator, as a straw man to curtail Fannie and Freddie’s mission.”

Franklin Raines, former head of Fannie Mae: “These assets are so riskless that their capital for holding them should be under 2%.

Richard Syron, former head of Freddie Mac: “If I had better foresight, maybe I could have improved things a little bit. But frankly, if I had perfect foresight, I would never have taken this job in the first place.”

Note: Raines was forced out of Fannie Mae in December 2004 after the Securities and Exchange Commission launched an investigation into alleged accounting problems at Fannie Mae involving an estimated $6 bn in accounting problems. The Office of Federal Housing Oversight sued Raines in 2006, accusing him of aiding accounting shenanigans at Fannie, which allegedly involved the delay of reporting losses so top executives could earn large bonuses.

The suit attempted to recover the $50 mn Raines in pay got based on billions of dollars in overstated earnings. In total, OFHEO demanded $110 mn in fines and a clawback of $115 mn in bonuses for three executives accused, including Raines.

Raines, Fannie’s former chief financial officer and its former controller settled the case in April 2008, agreeing to pay fines totaling about $3 mn, paid for by Fannie’s insurance policies.

Raines also agreed to donate the proceeds from the sale of $1.8 mn of his Fannie stock and to give up stock options, though the options were worthless. Raines also gave up an estimated $5.3 mn of “other benefits” said to be related to his pension and forgone bonuses. In the end, Raines kept most of his largesse–in 2003 alone, his compensation was estimated at over $20 mn.

Written by Ben

October 3, 2008 at 5:21 pm

Democrats have long history of stone-walling Republican efforts to regulate Fannie Mae and Freddie Mac

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You’re gonna love this. It’s enough to make you want to throw up. If Voting America had a brain they would get off their McDonald’s fed fat ass an vote every fricking Democrat out of office. But they won’t. They fear that if they do, their entitlements (read as government teat) will dry up.

We are heading down the road to a socialist country. Read about the GSE meltdown time line here.

Written by Ben

October 3, 2008 at 5:12 pm

How Did Your Senators Vote?

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TOTAL: Yea: 74
Nay: 25
NAME VOTE VOTE
Akaka (D-HI) Y
Alexander (R-TN) Y
Allard (R-CO) N
Barrasso (R-WY) N
Baucus (D-MT) Y
Bayh (D-IN) Y
Bennett (R-UT) Y
Biden (D-DE) Y
Bingaman (D-NM) Y
Bond (R-MO) Y
Boxer (D-CA) Y
Brown (D-OH) Y
Brownback (R-KS) N
Bunning (R-KY) N
Burr (R-NC) Y
Byrd (D-WV) Y
Cantwell (D-WA) N
Cardin (D-MD) Y
Carper (D-DE) Y
Casey (D-PA) Y
Chambliss (R-GA) Y
Clinton (D-NY) Y
Coburn (R-OK) Y
Cochran (R-MS) N
Coleman (R-MN) Y
Collins (R-ME) Y
Conrad (D-ND) Y
Corker (R-TN) Y
Cornyn (R-TX) Y
Craig (R-ID) Y
Crapo (R-ID) N
DeMint (R-SC) N
Dodd (D-CT) Y
Dole (R-NC) N
Domenici (R-NM) Y
Dorgan (D-ND) N
Durbin (D-IL) Y
Ensign (R-NV) Y
Enzi (R-WY) N
Feingold (D-WI) N
Feinstein (D-CA) Y
Graham (R-SC) Y
Grassley (R-IA) Y
Gregg (R-NH) Y
Hagel (R-NE) Y
Harkin (D-IA) Y
Hatch (R-UT) Y
Hutchison (R-TX) Y
Inhofe (R-OK) N
Inouye (D-HI) Y
Isakson (R-GA) Y
Johnson (D-SD) N
Kennedy (D-MA)
Kerry (D-MA) Y
Klobuchar (D-MN) Y
Kohl (D-WI) Y
Kyl (R-AZ) Y
Landrieu (D-LA) N
Lautenberg (D-NJ) Y
Leahy (D-VT) Y
Levin (D-MI) Y
Lieberman (ID-CT) Y
Lincoln (D-AR) Y
Lugar (R-IN) Y
Martinez (R-FL) Y
McCain (R-AZ) Y
McCaskill (D-MO) Y
McConnell (R-KY) Y
Menendez (D-NJ) Y
Mikulski (D-MD) Y
Murkowski (R-AK) Y
Murray (D-WA) Y
Nelson (D-FL) Y
Nelson (D-NE) N
Obama (D-IL) Y
Pryor (D-AR) Y
Reed (D-RI) Y
Reid (D-NV) Y
Roberts (R-KS) N
Rockefeller (D-WV) Y
Salazar (D-CO) Y
Sanders (I-VT) N
Schumer (D-NY) Y
Sessions (R-AL) N
Shelby (R-AL) N
Smith (R-OR) Y
Snowe (R-ME) Y
Specter (R-PA) Y
Stabenow (D-MI) N
Stevens (R-AK) Y
Sununu (R-NH) Y
Tester (D-MT) N
Thune (R-SD) Y
Vitter (R-LA) N
Voinovich (R-OH) Y
Warner (R-VA) Y
Webb (D-VA) Y
Whitehouse (D-RI) Y
Wicker (R-MS) N
Wyden (D-OR) N

Written by Ben

October 1, 2008 at 10:40 pm

Nancy Pelosi shows her ass on the eve of America’s most important moment.

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Nancy Pelosi, a clinical liberal, allows her emotions to eclipse what little intellect she has.

She would have served herself and this country very well if she had read the information provided to her on the Fannie Mae-Freddie Mac-AIG meltdown beginning in 2001 which has been published at the link provided above. Instead, she chose to ignore the calls for reforms of Fannie Mae and Freddie Mac, Government Sponsored Enterprises directed by Democrat Barney Frank and chose to direct her attention and energy to criticize President Bush while mentioning wispy, nebulous and unquantified “failed economic policies”.  Some say her putrid comments soured the deal.

In my opinion, the Democrats, recognizing Pelosi’s gaff and wishing to spin it to their advantage, point to her speech as the reason many Republicans (ignoring the many Democrats) who rejected the so-called bailout bill.

The fact is, the bill as it was written was bad for the country and deserved to be thrown out for the trash it was.

Nancy Pelosi would have done herself a favor by studying the following facts before allowing her ass to override her brain.

2001

April: The Administration’s FY02 budget declares that the size of Fannie Mae and Freddie Mac is “a potential problem,” because “financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity.”

2002

May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac.  (OMB Prompt Letter to OFHEO, 5/29/02)

2003

January: Freddie Mac announces it has to restate financial results for the previous three years.

February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that “although investors perceive an implicit Federal guarantee of [GSE] obligations,” “the government has provided no explicit legal backing for them.”  As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market.  (“Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO,” OFHEO Report, 2/4/03)

September: Fannie Mae discloses SEC investigation and acknowledges OFHEO’s review found earnings manipulations.

September: Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact “legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises” and set prudent and appropriate minimum capital adequacy requirements.

October: Fannie Mae discloses $1.2 billion accounting error.

November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any “legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk.”  To reduce the potential for systemic instability, the regulator would have “broad authority to set both risk-based and minimum capital standards” and “receivership powers necessary to wind down the affairs of a troubled GSE.”  (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03)

Source:   http://www.whitehouse.gov/news/releases/2008/09/20080919-15.html

Written by Ben

October 1, 2008 at 5:43 pm

Barney Frank should step down as Chairman of the House Financial Services Committee

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Mr. Frank is perhaps the most guilty of all of those who have worked hard to prevent efforts – beginning as far back as 2003 – to address the flawed policies of Fannie Mae and Freddie Mac which Mr. Frank oversees as Chairman of the House Financial Services Committee.

In 2003, Frank opposed Bush administration and Congressional Republican efforts for the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis. Under the plan a new agency would have been 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. “These two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis,” Frank said. He added, “The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

You can read about the GSE meltdown time line here. Try not to blow a gasket or bleed out of your eyeballs when you read what Mr. Frank and his ilk have to say about their management skills and their expert opinions on the matter. They basically tell us to butt-out and to mind our own business.

Written by Ben

September 29, 2008 at 8:10 pm

Republicans appear to some to be reacting to Nancy Pelosi’s Vomit

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On the failure of the U.S. House of Representatives to pass 700 billion bail-out plan.

Opponents said part of the reason for the opposition from Republicans was what they termed a partisan speech by House Speaker Nancy Pelosi, said one GOP source. House Minority Whip Roy Blunt said he thinks Republicans could have provided a dozen more votes had Pelosi not given her speech.

Pelosi had said that Congress needed to pass the bill, even though it was an outgrowth of the “failed economic policies” of the last eight years.

“When was the last time someone asked you for $700 billion?” she asked. “It is a number that is staggering, but tells us only the costs of the Bush administration’s failed economic policies — policies built on budgetary recklessness, on an anything goes mentality, with no regulation, no supervision, and no discipline in the system.”

Here are a few facts Nancy Pelosi should have studied before her ass replaced her brain.

The Bush Administration raised a red flag starting in April 2001. The administration’s 2002 budget request declares that the size of mortgage giants Fannie Mae and Freddie Mac is “a potential problem” because financial trouble in either one of them could cause “strong repercussions in financial markets.”

In 2003 the White House warning about Fannie and Freddie was upgraded to a systemic risk. that could spread beyond just the housing sector.

In the fall of 2003 the Bush Administration was pushing congress hard to create a new federal agency to regulate and supervise Fannie Mae and Freddie Mac both Government Sponsored Enterprises or GSEs. The then Treasury Secretary John W. Snow: “So we need a strong world class regulatory agency to oversee the prudential operations of the GSE’s and the safety and the soundness of their financial activities.” (Snow was nominated as Secretary of the Treasury by President George W. Bush on January 13, 2003 and unanimously confirmed by the US Senate. On May 30, 2003, it was formally announced that Snow would leave this position. On this same day, it was announced that President George W. Bush had nominated Henry Paulson, CEO of Goldman Sachs, to replace Snow. )

But Treasury Secretary John W. Snow was getting a lot of push back from then ranking member and now chairman of the house financial services committee Democratic congressman Barney Frank “Fannie Mae and Freddie Mac are not in any crisis”. In fact Frank said the federal government should be encouraging Fannie and Freddie to do more to get low income families into homes and he believed to many people had a sky is falling mentality. Frank: ” The more people in my judgment exaggerate the threat of safety and — the more people conjure — the possibility of serious financial losses to the tribute which I do not see, I think we see an entity that a fundamentally sound financially, and withstand some of the disaster scenarios and even if there were problems the federal government doesn’t bail them out, but the more protected everything there, then the less I think we see in terms of affordable housing.”

The legislation was blocked

In 2005 Fed chairman Alan Greenspan added his voice on Fannie Mae and Freddie Mac after many leaders admitted major accounting screw ups. Greenspan: “Enabling these institutions to increase in size – and they will once the crisis in their judgment passes – we are placing the total financial system of the future at a substantial risk.” Greenspan added later at another hearing on the topic: “If we failed to strengthen GSE regulation we increase the possibility of insolvency in crisis.” But the two mortgage giants had staunch defenders. Democratic senator Charles Schumer said “I think Fannie and Freddie over the years have done an incredibly good job and are an intrinsic part of making America the best housed people in the world. If you look over the last one — whatever years they’ve done very very good job.”

Senator John McCain cosponsored legislation pushing for regulation delivering a speech on the Senate floor in 2006. McCain: “For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac In the sheer magnitude of these companies in the role they play in the housing market the GSEs need to be reformed without delay.”

Written by Ben

September 29, 2008 at 8:09 pm

Republicans Recognize a Problem When They See It

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This short news report chronicles the events of the meltdown. Notice the Republicans are saying as far back as 2000 “Hey – there’s a problem here” and how Barney Franks (D) and the rest of the Democrats come back with “No, there isn’t. In fact, we want to do more to sell mortgages like these.” You can watch the video here.

Written by Ben

September 29, 2008 at 8:00 pm