"No Deal" on the Bailout

It is probably unfair to say that John McCain's decision to steer the presidential race off the campaign trail and into the White House jinxed the deal to bail out the nation's troubled economy.

Then again...

The much-heralded meeting between President Bush, the Democratic and Republican presidential nominees and congressional leaders-- which came together after McCain's Wednesday announcement that he was suspending campaigning until a deal was done--did not produce anything in the way of progress.

While House Banking Committee chairman Barney Frank and Senate Banking Committee chair Chris Dodd had suggested earlier Thursday that an agreement had been reached, the ranking Republican on the Senate committee, Alabama's Richard Shelby, said there was "no deal."

The big area of disagreement on whether to go ahead with some variation of Treasury Secretary Henry Paulson's $700 billion scheme appears to involve the issue of "executive compensation" – i.e., whether the Wall Street executives whose greed created the current mess will pocket some substantial portion of the bailout money.

The fact that the presence of Obama and McCain did nothing to advance the congressional negotiations with regard to the deal--and may actually have screwed them up--simply confirms Frank's astute assessment that McCain's decision to add the presidential candidates to the mix was a "distraction."

Of course, that's not the only distraction.

McCain's Wednesday announcement that he would suspend campaigning and, apparently, skip Friday night's presidential debate in Oxford, Mississippi, unless there was an agreement on the bailout, means that what happens--or does not happen--in Washington now becomes a distraction from the campaign.

How much remains to be seen.

But one thing is certain: Whether McCain goes to Oxford or not, Obama will be there.

Indeed, the Democrat suggests, he's open to turning what would have been a debate into a town hall meeting on the economy.

Not a bad idea, actually. And probably more productive than today's charade of a meeting at the White House.

Comments (80)

1. Obama needs to be MORE SHREWD so he is not used by Bush, Paulson or McCain to cover up THEIR SCREWUP in deregulating commercial banks, investment banks and insurance companies.

   In fact, if you really break this down, this "bailout" is a naked attempt by Paulson to cover up HIS ACTIONS as Chairman of Goldman Sachs, in which he led the charge for his bank to take on more risk in dealing in these mortgage-backed securities.

   This "bailout" is REALLY a Goldman Sachs bailout that is covered up with 700 billion for other banks so no one notices.

   Paulson has a HUGE conflict of interest in this matter, and should recuse himself so that other more effective solutions can be pursued that don't involve bailing out Goldman Sachs and are not tied to a GOLDMAN SACHS' TIMETABLE, as this bank struggles to survive.

   Paulson, like Bush, is trying to save his legacy as CEO of Goldman, in which he lobbied for de-regulation of investment banks and directed his bank to invest in these risky mortgage-backed securities. Paulson was also a principal player at Goldman Sachs in getting them in to deep do-do in the credit default swap market, in which they took on obligations that they cannot afford to meet.

   If banks are AFRAID to lend the money that we all know is WIDELY AVAILABLE, then the Federal Reserve should step in and modify its discount rate that is charges banks for money so that banks that stop lending are charged a "higher discount rate", and those that continue to lend at healthy loan to deposit ratios are "rewarded" with the lowest discount rate. <---this solution may not bail out Goldman Sachs, but it would insure that credit remains liquid and that the taxpayer is not left holding the bag for bad investments by "particular" banks.

   Posted by Metteyya at 09/25/2008 @ 6:11pm

2. "Indeed, the Democrat suggests, he's open to turning what would have been a debate into a town hall meeting on the economy."

   This would make McCain's ploy that much worse. He is in Mississippi winning a crowd and a televised situation by adeptly handling a talk about the economy and providing the American people with all the information they need. While McCain is in a closed meeting in Washington injecting more politics into a situation that needs as little as possible. McCain's ploy has done nothing but hurt the process. He needs to leave and go to the debate and pray it doesn't become about the economy so that the Senators involved can come to some sort of bipartisan agreement.

   Posted by Cccomfo1 at 09/25/2008 @ 6:16pm

3. McPOWhowmanyCARS/MANSIONS to suspend his campaign until after January 1, 2009-- to avoid all the other stressful stuff too.

   Posted by hsuBfools at 09/25/2008 @ 6:18pm

4. Seriously, other than the meeting with President Bush, has McCain even been near the negotiations? Not that I think he should, but this act of 'decicivness' looks more and more opportunistic by the day. Did he even make it to DC in time before a tentative agreement was announced?

   I don't believe NcBush is trying to cancel his debate with Obama, but I think this has more to do with his desire to postpone or cancel the VP debate.

   It's somewhat amusing to see the GOP scratch and claw as they see their grasp on unfettered power evaporate. Shame on them for this scortched earth policy that will leave whoever is in the WH next year (almost undoubtedly Obama) with their hands tied.

   I still don't get why we're not hearing about a totally different bottom up approach to this. Buy these foreclosed homes and rent them back to the former owners with conditions that if they demonstrate good credit behaviour, they can buy the homes back at a discount to market value. Put people to work on public projects, invest in green technologies. And if the banks won't lend, well, that's what the SBA is for, right? Expand that program! There's still enough capital out there to see a new generation of smaller investment houses. Let these 'too big to fail' banks fail.

   And if we must bail these pirates out, then we need equity in the firms, an interest rate on our money that is appropriate to the risk and rigorous controls. To hear Paulson say that these things might not enourage use of the program makes me sick.

   OBAMA/BIDEN 2008

   Posted by DGKusel at 09/25/2008 @ 6:24pm

5. Uhmm, what does "unfair marketing practices" mean?

   Posted by hsuBfools at 09/25/2008 @ 6:27pm

6. Posted by DGKusel at 09/25/2008 @ 6:24pm | ignore this person | warn this person

   Gotta love that Republican senator from Georgia.....he is my hero for the day.

   Posted by OneVote at 09/25/2008 @ 6:28pm

7. This is pure calculation on McCain's part. he has convinced the republicans to balk at any agreement. A debate right now would probably seal it for Obama. Good political move, very shrewd, not very good for the country.

   Posted by lachatte at 09/25/2008 @ 6:45pm

8. An interesting observation, John:

   "The big area of disagreement on whether to go ahead with some variation of Treasury Secretary Henry Paulson's $700 billion scheme appears to involve the issue of "executive compensation."

   I wonder why? Would it be that the representatives on the Republican side of the isle (as a result of their greedy addictions) are scared that agreeing to such would deny them their "golden parachute" when they retire from public service? Government=Goldman Sachs?

   Greedy bastards.

   Posted by CletusBleaker at 09/25/2008 @ 7:00pm

9. Another alternative is for the Government to act like a shrewd investor and ONLY BUY THE "GOOD" ASSETS of troubled banks.

   They could thin spin these assets off into NEW BANKS that are free from liabilities, assets declining in value, or assets worth less than the stated value . These new banks would have no trouble at all providing all of the liquidity needed to fuel the economy.

   Posted by Metteyya at 09/25/2008 @ 7:14pm

10. What's that? You signed a mortgage you couldn't afford? Well oh my goodness, it must be that those mean old mortgage companies and banks FORCED you to sign that mortgage...

    Posted by madlib at 09/25/2008 @ 6:20pm

    Mad, it was dizzying how fast the housing market tanked where I live. We bought a new residence in Mar 2007, reasonably thinking we could sell the old one. We did the analysis, talked to real estate agents and our financial advisors, and it made sense. It was definitely doable, well within the parameters of the market and our finances.

    In the month or two it took us to move out and get the old house ready to sell was when the shit hit the fan. A year and a half later, the old house is listed at $150,000 less than the original asking price and is $100,000 less than the mortgage. We still can't sell it. We can't rent it for what the mortgage, maintenance, taxes, and insurance costs, either, so even if it was rented, we'd still lose around $2000 a month on it.

    Of course, it has sat empty as we kept trying to sell it, so nobody was renting it to offset some of our carrying costs. Over the last 18 months the old house has cost us somewhere around $80,000. Yes, that's $80,000. We could easily afford the new house, if we didn't have two mortgages to pay. And the mortgages aren't ARMS - they are fixed rate, interest only.

    In our case (and I suspect there are many others that got caught up in this way), the problem isn't ARMs, subprimes, or living above our income or being stupid or greedy.

    The problem is there are no buyers.

    Posted by Balrog at 09/25/2008 @ 7:20pm

11. Corporate healthcare must be freaking out. All those nonprofit organizations who allowed hospitals to run down so they can pocket the money should be tried for crimes against humanity.

    Posted by nursevic at 09/25/2008 @ 7:22pm

12. >>>The problem is there are no buyers.

    Posted by Balrog at 09/25/2008 @ 7:20pm<<<

    There are no buyers because home prices were INFLATED. It is simply not sustainable to have mean home values to continue to rise above the capacity of most buyers to buy. At some point, either wages go up dramatically, or home values fall.

    Sorry you got caught up in this, but brokers, appraisers, banks, speculators, AND ARMS and subprimes were responsible for home values going up far in excess to the capacity of most buyers to afford.

    Wages are constrained by other market forces related to the price one can charge for goods and services in an increasingly global market, so the only thing that can move toward equilibrium is home values in a downward direction.

    I saw the early signs in other countries like Australia in 2004; and whenever you see more speculators buying houses than 'real" home buyers, that is usually a sign that you are near the peak of the housing market.

    Posted by Metteyya at 09/25/2008 @ 7:31pm

13. bad timing, than actual fault to be placed on anybody. You weren't necessarily swindled per se, more a victim of circumstance.

    Posted by madlib at 09/25/2008 @ 7:33pm

    Oh, definitely. I am not blaming anyone - it is what it is, ya know? I am, however, consulting a lawyer to investigate a deed in lieu of foreclosure or a foreclosure in an attempt to stop the bleeding. I can't afford to hold on for another 10 years waiting for the market to rebound. We've held on this long and it's only gotten worse...and I think it will continue to get worse for a good while yet.

    Posted by Balrog at 09/25/2008 @ 7:42pm

14. Posted by SooHAPPY at 09/25/2008 @ 7:40pm

    HAP,

    The banks left with the bad assets go into bankruptcy LIKE EVERYONE ELSE who makes bad business decisions!

    Why make an exception for Goldman Sachs?

    Posted by Metteyya at 09/25/2008 @ 7:43pm

15. Posted by SooHAPPY at 09/25/2008 @ 7:40pm

    ANY prospective "private" investor looking at these banks as an investment would do the same - buy only the "good" assets, so why should the government behave differently?

    Posted by Metteyya at 09/25/2008 @ 7:45pm

16. >>>Because it uses `public' money! It's FREE...

    Posted by SooHAPPY at 09/25/2008 @ 7:49pm<<<

    FREE?

    You must be nuts!

    That's the problem with these elitist banker types - they think the HARD EARNED money from taxpayers is "free".

    Well, HAP, maybe you think the government is a "free" piggybank that you can tap whenever you make bad decisions, but I don't think the vast majority of voters agree with you - and that includes liberals AND conservatives!

    Posted by Metteyya at 09/25/2008 @ 7:55pm

17. Anyone buying a new house in March `07, in an expensive part of the country, not caused by a relocation to another city or a major change in family composition......are the same types who were still deeply wedded to tech stocks in March 2000!

    Posted by SooHAPPY at 09/25/2008 @ 7:45pm

    Hindsight is 20/20, Hap.

    Posted by Balrog at 09/25/2008 @ 7:56pm

18. Posted by SooHAPPY at 09/25/2008 @ 7:49pm

    HAP,

    If you put that deal on my table - buy only the BAD ASSETS - I would be tempted to spit in your face!

    I then would lecture you on the fundamentals of business valuation, and demand ownership control of your stock, control of your board (especially the compensation committee) AND a "guaranteed" rate of return while we wait for you to get your act together and become profitable again!

    The government should do no less!

    Posted by Metteyya at 09/25/2008 @ 8:00pm

19. At this point, Repubs know they can screw over Bush and Paulson....

    whatever helps McCain and themselves in 40 days is what will make or break a deal.

    Posted by Maskdelta at 09/25/2008 @ 8:18pm

20. Posted by SooHAPPY at 09/25/2008 @ 8:22pm |

    So, HAPP...still glad you voted for Bush....twice?

    Posted by Maskdelta at 09/25/2008 @ 8:23pm

21. We know several things based on the well-established fact that neither Congress nor the Presidency, when faced with a choice between serving the interests of big business and serving the interests of The People, will choose to serve big business.

    1. Whatever the form of the bailout, there will be no change in government positions on (a) healthcare, (b) social security, (c) pensions, (d) education, (e) public infrastructure, (f) any public good which is not principally one of interest to the wealthy.

    2. Secrecy will prevail. We the People will be barred from any information which would allow us to raise well-informed objections.

    3. Congress and the President, though well-informed by many sources (like The Nation) will endow the Bailout with features directly repugnant to the Welfare of The People and directly Beneficial to the Corporate Elite at the expense of The People.

    The above generalizations rise beyond the status of empirical hypothesis to Political Law, there being no exception of any kind to them in the past 25 years of US government practice.

    Posted by hsansom at 09/25/2008 @ 8:28pm

22. I am all for McCain suspending his campaign. Will two months be enough to address this? I don't think this is a "Hail Mary" -- it seems more like a "Crazy Ivan."

    Posted by dmnygard at 09/25/2008 @ 8:35pm

23. Posted by SooHAPPY at 09/25/2008 @ 8:22pm

    HAP,

    We both know there would be "plenty" of buyers if banks got some sucker to buy their "bad" assets, and this is why the government needs several pounds of flesh if they are to go for such a lopsided deal.

    Like I said in the very first post on this thread, if availability of credit is the main "public" concern, there are far less expensive ways to create incentives for banks to loan money than buying their bad assets.

    Paulson has got Congress hypnotized into his thinking about the banking problem so no other viable alternatives outside of the bailout context are emerging.

    And this RUSH TO DECIDE nonsense Paualson is pushing is pure theater, as the only people that are in a hurry are the board of directors of Goldman Sachs and John McCain!

    Posted by Metteyya at 09/25/2008 @ 8:48pm

24. I'm going full-conspiracy! Grassy knoll baby. Reseville. The end of Bush can't be related only in the obvious ways to this freaky gas $ hike, to net-worth 700 million, ex G-Sachs chief Paulson NEARLY pushing through his hideous near-trillion $ heist, not to mention the shock doctrine Lehman, AIG, etc. And anyone else wondering about Paulson's 70+ trips to China?

    Personally, I think some of the more hideous, open-conspiracy crap is even worse. The media distortions that have McCain competitive here in Murdochville, at 20% vs Obama's 80% in 22 countries, per BBC poll. Things like dropping the "cut and run" mantra once Iraq itself declared it was aligned with Obama (ready to set a timeline, etc.), also of course aligned with the majority of Americans, and greater majority of the world. There are lots of examples, all reveal how bogus the corp media narratives are.

    Posted by winyahn at 09/25/2008 @ 9:11pm

25. McCain thinks he is channeling Ronald Reagan, when he is channeling Mortimer Snerd.

    Posted by lachatte at 09/25/2008 @ 9:23pm

26. The markets were up today, albeit on rumors of an agreement. Is there a "sky is falling" component to this crisis? Not to belittle it, but the economy did not crash today, as Paulson would have had everyone believe.

    I'm no economist, but common sense suggests that the political components alluded to in some of these posts may bear some scrutiny.

    Posted by jackwells at 09/25/2008 @ 9:31pm

27. obama looks more presidential every time i see him. his response was measured, informed and informative, unrelenting in tone...

    well done, o...

    Posted by dexter666 at 09/25/2008 @ 9:33pm

28. Next to that erratic, impulsive, stupid desperate old man, Obama not only looks presidential, but positively Churchillian.

    Posted by sgoodman at 09/25/2008 @ 10:24pm

29. I wish there were a god. If so, I would pray "PLEASE god don't let this bull$hit bailout pass."

    To hell with it!!

    Oh it's gonna be bad, real bad, bad bad bad, blah blah blah.

    F-it!!

    It'll be good for this gas guzzlin', latte drinking, clean fingernail, pasty skin, metrosexual, candyass, makeamillionnotdoing$hit, i'm-to-smart-to-work, supposedly disabled, inflated salary, tax sheltered, livingoffatrust citizenry!!

    Posted by bleedingheart at 09/25/2008 @ 10:34pm

30. OK, tonight Obama stands alone before the nation, the Ol' Miss audience & Lehrer.

    "Ask me anything you want, especially about the economy & about foreign affairs."

    Then he proceeds to answer every Q, for 90 minutes. Hitting the occasional homerun, but mainly solid doubles, even triples.

    For 90 minutes, Obama truly faces the nation. Hasn't spent a penny for this tv time, 90 minutes all to himself in front of 30 million people, maybe more.

    All because his opponent declined to appear.

    How can this possibly adhere to McC's benefit more than to Obama's?

    Does McC, for some reason unfathomable at this point -- perhaps even to himself - actually want to lose this election? Why else the drive to self-destruct?

    Posted by sloper at 09/25/2008 @ 11:07pm

31. OK, tonight Obama stands alone before the nation, the Ol' Miss audience & Lehrer.

    "Ask me anything you want, especially about the economy & about foreign affairs."

    Then he proceeds to answer every Q, for 90 minutes. Hitting the occasional homerun, but mainly solid doubles, even triples.

    For 90 minutes, Obama truly faces the nation. Hasn't spent a penny for this tv time, 90 minutes all to himself in front of 30 million people, maybe more.

    All because his opponent declined to appear.

    How can this possibly adhere to McC's benefit more than to Obama's?

    Does McC, for some reason unfathomable at this point -- perhaps even to himself - actually want to lose this election? Why else the drive to self-destruct?

    Posted by sloper at 09/25/2008 @ 11:07pm

32. "Don't forget to include the lazy good-for-nothing meth addict hillbillies that live out in the sticks!"

    "Just because they go deer hunting once a year doesn't mean they would survive more than 5 minutes if they couldn't buy their TV dinners from Wal-Mart. Or their insulin prescription since hillbillies are overweight and diabetic from drinking a gallon of soda with their double cheeseburgers."

    "Seeing one of the more whale-like rednecks here in PA makes me want to barf. Literally sick to my stomach. Riding around on their store-provided electric scooters, too fat to walk, but they'll show up at wal-mart, replete with oxygen tank and illegitimate children, to stock up on ice cream and fried foods."

    Those motherfuckers too!

    "Aside from all that, what is wrong with a latte exactly? You really have a problem with combining milk and espresso or....what?"

    Nothing really, I just have the same taste in coffee that I do in women.

    BLACK!!

    Posted by bleedingheart at 09/25/2008 @ 11:24pm

33. Obama is a thug and a liar

    Barack Obama is used to having his way. Interestingly, he is not a fan of people pointing out when he's lying about things like civil rights, especially that pesky Second Amendment.

    That's why Obama has a team of hired goons - some call them lawyers - to threaten legal action against those who air his record.

    The Obama campaign sent cease and desist letters to news outlets in Pennsylvania and Ohio, denouncing the ads and demanding their removal from the airwaves. All stations where NRA-PVF has purchased or plans to purchase ads have been provided with documented evidence of Sen. Obama's anti-gun record.

    The only problem is that the ads are based on a real, proven record. If anyone hears of a local outlet turning NRA down, call and complain about how upset you are that they would be so biased.

    Obama - Anti-First & Second Amendments

    Posted by pontificus at 09/25/2008 @ 11:40pm

34. Not only is Obama lying to gun owners when he says he 'supports the Second Amendment' (while not telling them that he doesn't feel the Second Amendment guarantees the right to keep and bear arms), he's threatening the licenses of any media outlet that dares to run ads from the NRA. This guy is a cheap Chicago thug, and a liar to boot.

    Posted by pontificus at 09/25/2008 @ 11:44pm

35. ponti-Your post was irrelevant and dishonest.Your thug thing was funny,though.Other than that your post was pure bs.

    Posted by i'm nobody at 09/25/2008 @ 11:45pm

36. ponti-You've been unable to show lying,but you have shown irrelevance to the topic.

    Posted by i'm nobody at 09/25/2008 @ 11:47pm

37. Posted by i'm nobody at 09/25/2008 @ 11:47pm

    Oh, really IM? Which part of my post do you dispute? Or is that covered under your blanket 'it's all bs', as per your usual cognitive dissonance?

    Posted by pontificus at 09/25/2008 @ 11:48pm

38. ponti-I'm bored with debunking your nonsense about the second amendment.It's nice that you know big words like cognitive dissonance,but you should find out what they mean.Got anything relevant to the topic or just your old whine about the second amendment that can never back up with facts like your recent posts?

    Posted by i'm nobody at 09/25/2008 @ 11:52pm

39. NO Bailout is GOOD for Obama!!

    STOP the bailout!

    Call your senator and representative.

    STOP the bailout!

    It will make Bush look even worse.

    STOP the bailout!

    (Ponti, don't worry about the guns! I know a few gangbangers who have some of unregistered guns for sale!)

    PS. Call/write/email/text/telegraph your senator and representative. STOP THE BAILOUT!!

    Posted by bleedingheart at 09/25/2008 @ 11:53pm

40. Well, IM, you said that my post was wrong, I simply asked you to say which part you dispute...if you can.

    Posted by pontificus at 09/25/2008 @ 11:54pm

41. Obama has been fighting the notion that he opposes gun rights, stressing on the stump that he backs Second Amendment protections. His campaign has released a radio ad featuring American Hunters and Shooters Association head Ray Schoenke telling hunters the Democratic nominee won't come for their guns.

    (note that contrary to its name, the American Hunters and Shooters Association is in favor of banning guns...from Wikipedia:The American Hunters and Shooters Association (AHSA) is an organization involved in advocacy for gun control.[1] Its critics claim that AHSA is a front organization aimed at dividing gun owners by pointing to AHSA members' bias against private ownership of the most popular modern sporting firearms, and note AHSA leaders have donated money to gun control groups[2] and maintained ties to individuals and organizations who advocate gun control.[3] Despite the similarity in name, AHSA has no ties to the field marksmanship promoting organization, the Hunter's Shooting Association (HSA).)

    "The bottom line is this. If you've got a rifle, you've got a shotgun, you've got a gun in your house, I'm not taking it away," Obama said earlier this month in Pennsylvania. "Alright? So they can keep on talking about it, but this is just not true."

    (Obama also said at the time that even if he wanted to take hunters' guns away, he "couldn't get it done" since he doesn't "have the votes in Congress" - a statement that did not exactly put sportsmen's fears to rest.)

    The Obama campaign is built on lies, deception, and threats.

    Posted by pontificus at 09/25/2008 @ 11:56pm

42. ponti-You haven't posted any facts.You made unsubstantiated claims of threats,but haven't said how Obama has the power to carry out the threats you claim he made nor have you posted any other facts.Just things you are claiming.Do you have anything relevant to the topic?

    Posted by i'm nobody at 09/25/2008 @ 11:58pm

43. Posted by i'm nobody at 09/25/2008 @ 11:58pm

    "You haven't posted any facts.You made unsubstantiated claims of threats,but haven't said how Obama has the power to carry out the threats you claim he made nor have you posted any other facts"

    I have a copy of a letter that Obama's campaign counsel sent to radio and television stations in Pennsylvania and Ohio, threatening their licenses if they air ads by the NRA. Certainly, Obama would be in a position to make good on this threat if he is elected, since he appoints the FCC chairman. Anything else you dispute?

    Posted by pontificus at 09/26/2008 @ 12:03am

44. Do you want me to point you to a copy of the letter, IM, or would you rather not know about that?

    Posted by pontificus at 09/26/2008 @ 12:06am

45. ponti-In other words,you are claiming that Obama is making threats, in writing, that he has no power to carry out and you base that on a letter that you claim was written by his council.I need to see the original and have it proven to have come from the people you claim..

    Posted by i'm nobody at 09/26/2008 @ 12:06am

46. ponti-An online copy would,for obvious reasons,be meaningless.

    Posted by i'm nobody at 09/26/2008 @ 12:07am

47. Posted by i'm nobody at 09/26/2008 @ 12:06am

    As I just showed you, IM, he has every prospect of being able to carry out retaliatory threats against television and radio stations that air ads he does not like. It's typical Chicago politics, so he's true to his pedigree.

    The letter is at

    http://www.thebitchgirls.us/wp-content/uploads/2008/09/obama.pdf

    Posted by pontificus at 09/26/2008 @ 12:09am

48. Posted by i'm nobody at 09/26/2008 @ 12:07am

    "ponti-An online copy would,for obvious reasons,be meaningless."

    Oh really? And why is that? Too convenient? What do you want, a notarized copy sent to your home address?

    Posted by pontificus at 09/26/2008 @ 12:10am

49. ponti-You did not show that Obama has the power to carry out any threats.You said he might be able to if he becomes POTUS and if the people who he sent letters to are stupid enough to not keep the letters so they could show that they were threatened.

    Posted by i'm nobody at 09/26/2008 @ 12:12am

50. ponti-In other words,you have nothing but a copy of a letter that you could have written.

    Posted by i'm nobody at 09/26/2008 @ 12:15am

51. Posted by i'm nobody at 09/26/2008 @ 12:12am

    The letters are already public, IM, as are the threats. I've shown you where they've been published already. You can dispute their authenticity, but nobody else does, including the Obama campaign, so I'm not sure where you're going with that. Also, the fact that Obama is not President yet does not mean his threat is empty, he very well could be elected, thus his threat is quite real.

    Posted by pontificus at 09/26/2008 @ 12:15am

52. Posted by i'm nobody at 09/26/2008 @ 12:15am

    "ponti-In other words,you have nothing but a copy of a letter that you could have written."

    But I didn't - in fact, the Obama campaign has no problem admitting writing them, so I don't know why you refuse to believe they did.

    Posted by pontificus at 09/26/2008 @ 12:16am

53. ponti-If Obama has admitted to the letters then where is the lie that you claim exists.

    Posted by i'm nobody at 09/26/2008 @ 12:17am

54. Are you calling the Obama campaign liars?

    Posted by pontificus at 09/26/2008 @ 12:17am

55. Posted by i'm nobody at 09/26/2008 @ 12:17am

    "ponti-If Obama has admitted to the letters then where is the lie that you claim exists."

    As I said in the first place, the lie is where Obama tells gun owners he supports the Second Amendment, consciously deceiving them into believing he does not want to take away their guns. But in fact, Obama does not believe the Second Amendment guarantees private gun ownership, and he is on record for saying so. Plainly, he is lying to people by consciously deceiving them about his position on gun control. Moreover, he is making threats against television stations that air ads outing him in this lie, threats he is well positioned to carry out if and when he becomes President. Thus, he is not only a liar, but a thug to boot.

    Posted by pontificus at 09/26/2008 @ 12:21am

56. ponti-You never said that the letters are public and that Obama admits to writing them.No big deal then since everyone knows and it's reported in the news.You should have just said that this commonly known about and I missed it and pointed out your news source..

    Posted by i'm nobody at 09/26/2008 @ 12:21am

57. ponti-Saying that he doesn't want to take your guns away,but interprets the second amendment differently than you do is not lying.That's quite honest.I will check to see if those letters are common knowledge and if Obana admits to writing them.

    Posted by i'm nobody at 09/26/2008 @ 12:24am

58. Posted by i'm nobody at 09/26/2008 @ 12:21am

    Sorry, I assume that everyone keeps up on current events here.

    Posted by pontificus at 09/26/2008 @ 12:24am

59. ponti-No wonder I had no idea what you were talking about.You were doing a bit of truth stretching about thugs,lying,and threats.This is common knowledge and you were being dishonest about what his lawyer said and why so,of course,I had no idea what you were referring to.Try being honest next time.They are threatening legal action that can affect their licenses and not making the types of threats that you claimed.

    Posted by i'm nobody at 09/26/2008 @ 12:35am

60. ponti-The ads are the lie which is what Obama's lawyers are basing their legal action on.Obama did not write letters saying that he would pull their license if he was elected.

    Posted by i'm nobody at 09/26/2008 @ 12:41am

61. Posted by madlib at 09/25/2008 @ 10:56pm

    niiiiiiice release

    Like a wicked fast McInrow backhand cross court winner.

    Ahhhhh! America's finest. Another election and the barely 'got-my GED' heffer herdette and Levi-pride pickup n cap zero head off for the polls.

    And another blow to Jefferson.

    You know the odd part of the media-code: 'white working class',

    And their brood, greasy-carseatless-toddlers-in-match'n-camo

    Suckin-up-second-hand-smoke...

    Is their combo of cocky and hostile,

    their profound learning disability,

    their impenetrability. Their pride in stupidity.

    Posted by winyahn at 09/26/2008 @ 12:46am

62. If you really think about it, it would be a wise decision for McCain to take a powder and not show for the debate on 9/26/. This debate is supposed to be on foreign policy. This is the debate McCain needs.

    He cannot afford to have his fear-mongering line of bullshit diminished. As it surely would be, overshadowed by the financial crisis. Exposing himself to questions regarding the economy would be a disaster at this time. Consider his track record, his seedy S&L past, and his recent embarrassing "The economy is fundamentally strong" gaff.

    Posted by koroviev at 09/26/2008 @ 01:09am

63. To the Speaker of the House of Representatives and the President pro tempore of the Senate:

    As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function. We see three fatal pitfalls in the currently proposed plan:

    1) Its fairness. The plan is a subsidy to investors at taxpayers' expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.

    2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwards.

    3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.

    For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come.

    Signed (200 Economists at Top Universities)

    Posted by Metteyya at 09/26/2008 @ 01:36am

64. Acemoglu Daron (Massachussets Institute of Technology) Adler Michael (Columbia University) Admati Anat R. (Stanford University) Alexis Marcus (Northwestern University) Alvarez Fernando (University of Chicago) Andersen Torben (Northwestern University) Baliga Sandeep (Northwestern University) Banerjee Abhijit V. (Massachussets Institute of Technology) Barankay Iwan (University of Pennsylvania) Barry Brian (University of Chicago) Bartkus James R. (Xavier University of Louisiana) Becker Charles M. (Duke University) Becker Robert A. (Indiana University) Beim David (Columbia University) Berk Jonathan (Stanford University) Bisin Alberto (New York University) Bittlingmayer George (University of Kansas) Boldrin Michele (Washington University) Brooks Taggert J. (University of Wisconsin) Brynjolfsson Erik (Massachusetts Institute of Technology) Buera Francisco J. (UCLA) Camp Mary Elizabeth (Indiana University) Carmel Jonathan (University of Michigan) Carroll Christopher (Johns Hopkins University) Cassar Gavin (University of Pennsylvania) Chaney Thomas (University of Chicago) Chari Varadarajan V. (University of Minnesota) Chauvin Keith W. (University of Kansas) Chintagunta Pradeep K. (University of Chicago) Christiano Lawrence J. (Northwestern University) Cochrane John (University of Chicago) Coleman John (Duke University) Constantinides George M. (University of Chicago) Crain Robert (UC Berkeley) Culp Christopher (University of Chicago) Da Zhi (University of Notre Dame) Davis Morris (University of Wisconsin) De Marzo Peter (Stanford University) Dubé Jean-Pierre H. (University of Chicago) Edlin Aaron (UC Berkeley) Eichenbaum Martin (Northwestern University) Ely Jeffrey (Northwestern University) Eraslan Hülya K. K.(Johns Hopkins University)

    Posted by Metteyya at 09/26/2008 @ 01:39am

65. Faulhaber Gerald (University of Pennsylvania) Feldmann Sven (University of Melbourne) Fernandez-Villaverde Jesus (University of Pennsylvania) Fohlin Caroline (Johns Hopkins University) Fox Jeremy T. (University of Chicago) Frank Murray Z.(University of Minnesota) Frenzen Jonathan (University of Chicago) Fuchs William (University of Chicago) Fudenberg Drew (Harvard University) Gabaix Xavier (New York University) Gao Paul (Notre Dame University) Garicano Luis (University of Chicago) Gerakos Joseph J. (University of Chicago) Gibbs Michael (University of Chicago) Glomm Gerhard (Indiana University) Goettler Ron (University of Chicago) Goldin Claudia (Harvard University) Gordon Robert J. (Northwestern University) Greenstone Michael (Massachusetts Institute of Technology) Guadalupe Maria (Columbia University) Guerrieri Veronica (University of Chicago) Hagerty Kathleen (Northwestern University) Hamada Robert S. (University of Chicago) Hansen Lars (University of Chicago) Harris Milton (University of Chicago) Hart Oliver (Harvard University) Hazlett Thomas W. (George Mason University) Heaton John (University of Chicago) Heckman James (University of Chicago - Nobel Laureate) Henderson David R. (Hoover Institution) Henisz, Witold (University of Pennsylvania) Hertzberg Andrew (Columbia University) Hite Gailen (Columbia University) Hitsch Günter J. (University of Chicago) Hodrick Robert J. (Columbia University) Hopenhayn Hugo (UCLA) Hurst Erik (University of Chicago) Imrohoroglu Ayse (University of Southern California) Isakson Hans (University of Northern Iowa) Israel Ronen (London Business School) Jaffee Dwight M. (UC Berkeley) Jagannathan Ravi (Northwestern University) Jenter Dirk (Stanford University) Jones Charles M. (Columbia Business School)

    Posted by Metteyya at 09/26/2008 @ 01:41am

66. Kaboski Joseph P. (Ohio State University) Kahn Matthew (UCLA) Kaplan Ethan (Stockholm University) Karolyi, Andrew (Ohio State University) Kashyap Anil (University of Chicago) Keim Donald B (University of Pennsylvania) Ketkar Suhas L (Vanderbilt University) Kiesling Lynne (Northwestern University) Klenow Pete (Stanford University) Koch Paul (University of Kansas) Kocherlakota Narayana (University of Minnesota) Koijen Ralph S.J. (University of Chicago) Kondo Jiro (Northwestern University) Korteweg Arthur (Stanford University) Kortum Samuel (University of Chicago) Krueger Dirk (University of Pennsylvania) Ledesma Patricia (Northwestern University) Lee Lung-fei (Ohio State University) Leeper Eric M. (Indiana University) Leuz Christian (University of Chicago) Levine David I.(UC Berkeley) Levine David K.(Washington University) Levy David M. (George Mason University) Linnainmaa Juhani (University of Chicago) Lott John R. Jr. (University of Maryland) Lucas Robert (University of Chicago - Nobel Laureate) Luttmer Erzo G.J. (University of Minnesota) Manski Charles F. (Northwestern University) Martin Ian (Stanford University) Mayer Christopher (Columbia University) Mazzeo Michael (Northwestern University) McDonald Robert (Northwestern University) Meadow Scott F. (University of Chicago) Mehra Rajnish (UC Santa Barbara) Mian Atif (University of Chicago) Middlebrook Art (University of Chicago) Miguel Edward (UC Berkeley) Miravete Eugenio J. (University of Texas at Austin) Miron Jeffrey (Harvard University) Moretti Enrico (UC Berkeley) Moriguchi Chiaki (Northwestern University) Moro Andrea (Vanderbilt University) Morse Adair (University of Chicago) Mortensen Dale T. (Northwestern University) Mortimer Julie Holland (Harvard University) Muralidharan Karthik (UC San Diego)

    Posted by Metteyya at 09/26/2008 @ 01:42am

67. Nevo Aviv (Northwestern University) Ohanian Lee (UCLA) Pagliari Joseph (University of Chicago) Papanikolaou Dimitris (Northwestern University) Parker Jonathan (Northwestern University) Paul Evans (Ohio State University) Pejovich Svetozar (Steve) (Texas A&M University) Peltzman Sam (University of Chicago) Perri Fabrizio (University of Minnesota) Phelan Christopher (University of Minnesota) Piazzesi Monika (Stanford University) Piskorski Tomasz (Columbia University) Rampini Adriano (Duke University) Reagan Patricia (Ohio State University) Reich Michael (UC Berkeley) Reuben Ernesto (Northwestern University) Roberts Michael (University of Pennsylvania) Robinson David (Duke University) Rogers Michele (Northwestern University) Rotella Elyce (Indiana University) Ruud Paul (Vassar College) Safford Sean (University of Chicago) Sandbu Martin E. (University of Pennsylvania) Sapienza Paola (Northwestern University) Savor Pavel (University of Pennsylvania) Scharfstein David (Harvard University) Seim Katja (University of Pennsylvania) Seru Amit (University of Chicago) Shang-Jin Wei (Columbia University) Shimer Robert (University of Chicago) Shore Stephen H. (Johns Hopkins University) Siegel Ron (Northwestern University) Smith David C. (University of Virginia) Smith Vernon L.(Chapman University- Nobel Laureate) Sorensen Morten (Columbia University) Spiegel Matthew (Yale University) Stevenson Betsey (University of Pennsylvania) Stokey Nancy (University of Chicago) Strahan Philip (Boston College) Strebulaev Ilya (Stanford University) Sufi Amir (University of Chicago) Tabarrok Alex (George Mason University) Taylor Alan M. (UC Davis) Thompson Tim (Northwestern University) Tschoegl Adrian E. (University of Pennsylvania)

    Posted by Metteyya at 09/26/2008 @ 01:45am

68. Uhlig Harald (University of Chicago) Ulrich, Maxim (Columbia University) Van Buskirk Andrew (University of Chicago) Veronesi Pietro (University of Chicago) Vissing-Jorgensen Annette (Northwestern University) Wacziarg Romain (UCLA) Weill Pierre-Olivier (UCLA) Williamson Samuel H. (Miami University) Witte Mark (Northwestern University) Wolfers Justin (University of Pennsylvania) Woutersen Tiemen (Johns Hopkins University) Zingales Luigi (University of Chicago) Zitzewitz Eric (Dartmouth College)

    Posted by Metteyya at 09/26/2008 @ 01:46am

69. I am tired of people not taking responsibility for their actions. It takes two to tango, and a claim of ignorance is not a valid excuse.

    Posted by madlib at 09/25/2008 @ 6:20pm

    generalizations are a dangerous thing.

    hmmm.

    let me rephrase that....

    Posted by frosty zoom at 09/26/2008 @ 01:58am

70. I quit because I could no longer justify selling mortgages and fighting for them to be approved, for people who I knew did not understand the terms and conditions of their mortgages, let alone that I knew that in the long run, as soon as their rate changed, they'd be in a horrible situation.

    Posted by madlib at 09/25/2008 @ 7:33pm

    see.

    Posted by frosty zoom at 09/26/2008 @ 02:01am

71. but positively Churchillian.

    Posted by sgoodman at 09/25/2008 @ 10:24pm

    careful what you wish for.

    Posted by frosty zoom at 09/26/2008 @ 02:03am

72. Why is it that I have seen no mention of the fact that this bailout plan would require the Treasury to borrow the money to pull it off, and they would borrow it from the Federal Reserve system, a system of private banks chartered by the US government to run the money supply. This would in turn result in a huge increase in the interest paid on the national debt. If interest rates were to rise that payment would start to dwarf the rest of the budget. It all seems like a ploy to collapse the government financially resulting in the treasured desire of the neo-cons to make the government forever ineffective by making it impossible to pay for anything. The "it must be done right now" stuff points to a conspiracy along these lines. No debate? Turn over the whole show to the people who created the problem in the first place? Are we nuts?

    It's not just the CEO's who would benefit, but the private international bankers behind the whole system.

    Posted by hughsbayou at 09/26/2008 @ 02:09am

73. This may sound a bit strange, but I would like those whose salaries I help to pay to show up at work once in a while and do the job they are paid to do. This problem is serious enough that McCain and Obama (last I new they still had the title of Senator) should be a part of the solution rather than bystanders. I am sure to some here (especially the elite) that this is a radical and impractical idea.

    Posted by independentthinker316 at 09/26/2008 @ 02:12am

74. you said they didn't understand that.

    they understood loan, interest, house.

    they can read all the fine print. it doesn't mean they would understand any of it.

    the fine print is deliberately written in impossilese in order to facilitate the swindle.

    people voted for bush twice and these are today's top google searches:

    1. alton desiree 2. i m not a princess lyrics 3. the office season 5 episode 1 4. jacquizz rodgers 5. taylor swift white horse 6. i m not a princess this ain t a fairytale 7. oregon state 8. grey s anatomy music 9. bernadette peters 10. usc vs oregon state

    bernadette peters?

    anyhoo, sure some people knew they were taking on too much, but many were also swindled by the credit dream.

    there's about $70 trillion total debt in the u.s. alone.

    crazy.

    Posted by frosty zoom at 09/26/2008 @ 03:15am

75. I saw the early signs in other countries like Australia in 2004; and whenever you see more speculators buying houses than 'real" home buyers, that is usually a sign that you are near the peak of the housing market.

    Posted by Metteyya at 09/25/2008 @ 7:31pm

    What you say is basically sound. But it is inflated house prices (and asset inflation generally) that have enabled many working class persons to become asset rich. The housing boom in Australia has not collapsed as it has in the US, in part because our resources based economy has been booming for many years now and is likely to continue on that path due to demand from China and India as they relentlessly pursue industrialisation of their economies.

    Like the stock market there are times when one should not buy into the housing market.

    I mentioned, on another thread, a house purchased by an Aunt about 5 miles from Melbourne's CBD during 1961 for $4500. She willed it to me in 1999. We rented it out until 2007 when I thought the market was peaking. We sold it for$825,000. A developer bought it at auction, pulled it down and built 3 units, which sold for about $650,000 each. I notice median prices in that area have since fallen about 8%.

    Here's some interesting 1960 investment figures:

    1 $4500 at 4.5% in a bank. Compound interest to 2007 gives a 7.9 times return or $34,085.

    2 $4500 in gold at $35/oz, now about $900, gives a 25.7 times return or $115,714.

    3 $4500 in median price house gives 183 times return or $825,000.

    Many working class people have been able to get finance for another house against the security of their live-in home and are now very wealthy.

    The "secret" is knowing when to buy and when to sell.

    The US problem would never happen here as our lending regulations are much more stringent.

    Posted by lrjones4 at 09/26/2008 @ 07:19am

76. The US problem would never happen here as our lending regulations are much more stringent.

    Posted by lrjones4 at 09/26/2008 @ 07:19am

    never say never.

    as the house of cards tumbles,

    it will generate some pretty nasty winds.....

    Posted by frosty zoom at 09/26/2008 @ 08:23am

77. Mad - I kinda agree with ya: "No excuse for not reading the fine print." Unfortunately, I think many of the shlubs who got sucked into ARM didn't take the time to ask the right questions of their lenders, if they asked at all. No thought about what could/would happen when the interest rates climbed after time. We Americans are victims of our own failure to look backward, as well as our failure to look forward. Always the now.

    Posted by javaman222 at 09/26/2008 @ 09:41am

78. It is more than coincidence that shortly after Senator McCain's 'triumphant' arrival in Washington, D.C., yesterday, that House Republicans are suddenly opposed to the pending deal that has been going through the legislative deliberative process for the past week. None of this is pretty, and in fact, President Bush, of whom I'm no fan, has acted responsibly and calmly during this crisis, as has Senator Obama and the Congressional Leadership in their deliberate actions.

    Senator McCain, on the other hand, has once again lurched into this NOT to provide input and support for the no doubt intense discussions that have taken place, but has instead offered the Country yet another reason to question his ability to act responsibly, calmly and as a thoughtful Leader of the American People. That he has an issue with the deal is to simply voice the concern of the majority of the electorate. That he runs the possibility of derailing ANY deal through his latest antics would spell certain doom for the plan and increased hardship for the People of the United States and the World. Is THIS what he and his campaign mean by putting "Country First"?

    Posted by wkoenig at 09/26/2008 @ 10:15am

79. This boils down to an effort to save his cratering campaign and most certainly to avoid having Governor Palin getting anywhere near Senator Biden and in front of the cameras for the upcoming Vice Presidential Debate. Covering one bad bet (Governor Palin) with another (objecting to the bailout and potentially refusing to debate Senator Obama tonight) only confirms what is increasingly obvious....Senator McCain does NOT have the capacity to Lead this Country as President of the United States.

    Posted by wkoenig at 09/26/2008 @ 10:16am

80. never say never.

    as the house of cards tumbles,

    it will generate some pretty nasty winds.....

    Posted by frosty zoom at 09/26/2008 @ 08:23am

    The never is in the context of present lending criteria that requires a substantial deposit and a maximum monthly repayment in terms of net (post tax) salary.

    Some years ago that was 30% of net monthly salary. It is probably higher now but banks do their "dirty" lending via credit cards where typical rates are 16 % to 22%. That obviously factors in those who default and should never have got a credit card in the first place. The banks, given the credit card offers of higher limits still coming in the mail, certainly don't seem to be short of funds.

    One just wonders why the "market" is not left to its own devices. There is some speculation here that in time the market would have corrected itself through failures, liquidations, buyouts and the market organising its own funds.

    The reality I guess is that if finance is not readily on tap to "oil" the economy it would have an adverse effect on all sorts of enterprises that are cash short but otherwise are sound businesses in terms of orders and profitability.

    It does seem as though the US has an oversupply of housing, which would deflate prices, as would any increase in rates or decline in availability of housing loans. That seems to be a valid reason for the government to step in and use the money that once belonged to tax payers to prevent the wider economy slowing. That may hurt most more than spending taxpayers "x-money".

    Posted by lrjones4 at 09/26/2008 @ 10:20am