How to Ruin the U.S. Economy
Yahoo! Finance | Ben Stein | Oct. 6, 2008
1) Have a fiscal policy that creates immense deficits in good times and bad, burdening America’s posterity with staggering burdens of repaying the debt.
2) Eliminate regulation of Wall Street and/or fail to enforce the regulations that already exist, instead trusting Wall Street and other money managers and speculators to manage other people’s money with few or no regulations and little oversight.
3) Have an energy policy that disallows producing our own energy and instead requires that we buy energy from abroad, thus making our oil prices highly volatile and creating large balance of payments deficits, lowering the value of the dollar and thus making the problem get progressively worse.
4) Have Congress mandate that banks and other financial entities lend money to persons they know in advance to have poor credit ratings or none at all. [Read more…]
How the Democrats Created the Financial Crisis
Guess who killed key legislation back in 2005 that would have addresed the financial mess we’re in.
Bloomberg | Kevin Hassett | Sept. 22, 2008
If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.
But the bill didn’t become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn’t even get the Senate to vote on the matter.
That such a reckless political stand could have been taken by the Democrats was obscene even then. Wallison wrote at the time: “It is a classic case of socializing the risk while privatizing the profit. The Democrats and the few Republicans who oppose portfolio limitations could not possibly do so if their constituents understood what they were doing.” [Read more…]
New Agency Proposed to Oversee Freddie Mac and Fannie Mae
Guess who tried to prevent the financial crisis more than 5 years ago.
The New York Times | STEPHEN LABATON | Sept. 11, 2003
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. [Read more…]
Do Facts Matter?
Townhall.com | Thomas Sowell | Oct. 3, 2008
Abraham Lincoln said, “You can fool all the people some of the time and some of the people all the time, but you can’t fool all the people all the time.” Unfortunately, the future of this country, as well as the fate of the Western world, depends on how many people can be fooled on election day, just a few weeks from now. Right now, the polls indicate that a whole lot of the people are being fooled a whole lot of the time.
The current financial bailout crisis has propelled Barack Obama back into a substantial lead over John McCain– which is astonishing in view of which man and which party has had the most to do with bringing on this crisis. [Read more…]
The Most Wanted Infidel in the World
OrthodoxyToday.org | Raymond Ibrahim | Sep. 18, 2008
Al Qaeda declares Coptic priest Zakaria Botros “one of the most wanted infidels in the world” and offers $60 million for his head.
You have probably never heard of Father Zakaria Botros. But you need to know his story. He is far and away the most-watched and most-effective Arab-American evangelist focused on reaching the Muslim world, and by far the most controversial. The Rush Limbaugh of the Revivalists, he is funny, feisty, brilliant, opinionated, and provocative. But rather than preaching the gospel of conservatism, he is preaching the gospel of Jesus Christ. And his enemies do not simply want to silence him. They want to assassinate him. [Read more…]
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Bailout Numbers in Perspective
Small Business & Entrepreneurship Council | Raymond J. Keating | September 26, 2008
When it comes to tallying up the federal government’s recent bailout announcements, the numbers are so staggering that they might seem unreal to many people.
For Bear Stearns: $29 billion.
For Fannie Mae and Freddie Mac: $200 billion.
For AIG: $85 billion.
And now, of course, Washington debates Treasury Secretary Hank Paulson’s $700 billion to bailout financial firms that made bad debt decisions.
That’s $1.014 trillion in taxpayer money placed at risk. (And there’s the $25 billion loan package-bailout moving through the Congress for automakers.) Unfortunately, since there is no substantive analysis to back up the $700 billion the Treasury wants, the bill may go even higher.
But let’s take $1 trillion as the number for now, and put it in perspective. For example:
[Read more…]