Bush warns 'entire economy is in danger'

Where's the jobs ? How can people afford a home without a job ? Build more homes ?

Without a rescue plan, we may indeed have a long recession, but with some social investment and recommitment to American ideals of hard work and fair wages, the economy can come back healthy.

With a $700 billion bailout, we may avoid short-term extreme consequences, but we are setting a dangerous precedent for big business: that they can play whatever risky games they want and if they screw up big enough the government will save their hides. I am very skeptical that any long term good will come out of a $700 billion bailout with no strings attached.

When Bush covered the topic of how the economic problems got out of control, I noticed that he was quick to blame people who borrowed more than they could afford. However, he did not mention fact that many of these loans had interest rates which be changed for no reason. I wonder if these bogus rates made the mortgages more attractive to greedy investors in the investment banks. After all, these money changers are experts--as opposed to people who are working at real jobs which produce real wealth.

Idiot

When will we see the corrupt bastards who created this mess prosecuted? When will their assets be seized to help pay for the mess they've caused? Well, if you're 20, your great, great grandchildren won't live to see that day.

If we keep looking in the rear view mirror, clucking our tongues and wagging our fingers, we're going off the cliff for sure.

Who gets the credit? Who gets the blame? WHO CARES?

If it's fixable, FIX IT, take the heat if it fails, and credit if it succeeds.

Maybe in their heart of hearts, both sides think it's not fixable and believes the other side will be the ones to blame.

I don't get it. We have just as many productive Americans willing and ready to work hard for a good paycheck as we did 1, 3, 5, 10 years ago. Sometimes I, seriously, think all we need is a good public service campaign - "Stop believing the gloom and doom, get to work and prosper!" This negative vibe feeds on itself. No, I don't mean WIN buttons. (If you're old enough to remember what that stands for, join the club.) I just mean an antidote for the toxic death spiral of bleak attitudes.

Wishful thinking, right?;-/

Aren't we proud of our President he made at total @ss of Himself

you guys didn't miss this i hope-

UPDATE 11:30: BAIL OUT HEARING: CHRIS DODD IS BRINGING DOWN THE GAVEL? WTF is Dodd doing there? That's like Lucky Luciano presiding over the Al Capone trial. Fookin nutz! As chairman of the Senate Banking Commitee , Dodd insisted that these ridiculous loans be made over the past 10 years!

UPDATE: Senator Jim Bunning, Republican of Kentucky, has emerged as one of the most strident enemies of the bailout proposal "It's financial socialism, and it's un-American," he said in his opening statement. On Friday, he offered a eulogy for the economy, saying, "The free market for all intents and purposes is dead in America."

Are Americans, who are footing perhaps a trillion dollar bill, even remotely interested in how it really happened? I ask you. When we may very well be working 40-45% of the time for the government, will they inquire - how did I get here or will they listen to the complete line of bull@!$%# the Obama, a chief moocher and looter, is inventing? I have to know. The mainstream media is depraved. It does not do investigative journalism save to smear folks on the right.And even then it is invented. They should aspire to the journailstic standards of the Enquirer. Instead, they have 14,000 trolls in Alaska tracking what feminine protection Sarah Palin uses so that they might tie her to global warming.

In his incredibly short stint in politics, Obama was the second highest recipient of Fannie Mae/ Freddie Mac lobby dollars. Why isn't the media ripping him a new %$#hole?

Why is a first term Senator pulling down almost $300,000 a year from Goldman Sachs, Lehman Brothers, Bear Stearns, Fannie Mae, Freddie Mac, AIG, Countrywide Financial, and Washington Mutual? He has not even completed his fourth year in the Senate and received a total of $1,093,329.00 from these eight companies and their employees. (all data from OpenSecrets.org). John McCain's numbers, according to OpenSecrets.org for the period 1990-2008 (i.e., 18 years worth of data) only collected $549,584.00. In other words, Barack is receiving $273,582.25 (and 2008 is not over) per year while McCain raised a paltry $30,532.44.

Want another shocker? Barack Obama has received more from one source–Goldman Sachs $542,252.00–than McCain has from all of the companies combined. Who the hell is more beholden to lobbyists? And why does a junior Senator from Illinois rate this kind of dough? (more here)

If shock of the crushing blow of 9/11 didn't wake America up to Islam, will this crushing financial implosion? McCain must take the damn gloves off. This is a good beginning: Steve Schmidt, a McCain campaign senior adviser, on a conference call with reporters Monday said that The New York Times "is not a journalistic organization."

"Whatever The New York Times once was, it is today not by any standard a journalistic organization," Schmidt said. "It is a pro-Obama advocacy organization that every day impugns the McCain campaign, attacks Senator McCain, attacks Governor [Sarah Palin]. It excuse Senator Obama. …

"Everything that is read in The New York Times that attacks this campaign should be evaluated by the American people from that perspective – that it is an organization that has made a decision to deemphasize its journalistic integrity and tradition, to advocate for the defeat of one candidate – in this case, John McCain – and to advocate for the election of the other candidate, Barack Obama."

Schmidt said later that the Obama campaign has been "abetted" by a compliant media that gives more scrutiny to the Republican than to the Democrat. (more here)

Schmidt is going to easy on the NY Crimes. Check out the financial back story.

How the Democrats Created the Financial Crisis Kevin Hassett Bloomberg hat tip JM

Back in 2005, Fannie and Freddie were, after years of dominating, on the ropes. They were enmeshed in accounting scandals that led to turnover at the top. At one telling moment in late 2004, captured in an article by my American Enterprise Institute colleague Peter Wallison, the Securities and Exchange Comiission's chief accountant told disgraced Fannie Mae chief Franklin Raines that Fannie's position on the relevant accounting issue was not even ``on the page'' of allowable interpretations.

Then legislative momentum emerged for an attempt to create a ``world-class regulator'' that would oversee the pair more like banks, imposing strict requirements on their ability to take excessive risks. Politicians who previously had associated themselves proudly with the two accounting miscreants were less eager to be associated with them. The time was ripe.

The clear gravity of the situation pushed the legislation forward. Some might say the current mess couldn't be foreseen, yet in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie ``continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,'' he said. ``We are placing the total financial system of the future at a substantial risk.''

What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.

Different World

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.''

Mounds of Materials

Now that the collapse has occurred, the roadblock built by Senate Democrats in 2005 is unforgivable. Many who opposed the bill doubtlessly did so for honorable reasons. Fannie and Freddie provided mounds of materials defending their practices. Perhaps some found their propaganda convincing.

But we now know that many of the senators who protected Fannie and Freddie, including Barack Obama, Hillary Clinton and Christopher Dodd, have received mind-boggling levels of financial support from them over the years.M/P>

Throughout his political career, Obama has gotten more than $125,000 in campaign contributions from employees and political action committees of Fannie Mae and Freddie Mac, second only to Dodd, the Senate Banking Committee chairman, who received more than $165,000.

Clinton, the 12th-ranked recipient of Fannie and Freddie PAC and employee contributions, has received more than $75,000 from the two enterprises and their employees. The private profit found its way back to the senators who killed the fix.

There has been a lot of talk about who is to blame for this crisis. A look back at the story of 2005 makes the answer pretty clear.

Oh, and there is one little footnote to the story that's worth keeping in mind while Democrats point fingers between now and Nov. 4: Senator John McCain was one of the three cosponsors of S.190, the bill that would have averted this mess.

UPDATE: Doug over at Director Blue put this excellent photo journalistic montage together:

Any Questions? hat tip Larwyn

Five years ago, Republicans proposed "the most significant regulatory overhaul in the housing finance industry [in a decade]." (Source: New York Times)

Democrats on the House Financial Services Committee blocked efforts at fixing Fannie and Freddie. Rep. Barney Frank (D-MA) said, "Fannie Mae and Freddie Mac... are not facing any kind of financial crisis,"

At least 18 times since 2001 Democrats blocked efforts at overhauling Fannie and Freddie even as accounting scandals and executive ripoffs became public.

Why? For starters, the top two recipients of Fannie and Freddie campaign donations were Democrat fatcats Chris Dodd ($165K) and Barack Obama ($126K) (Source: Open Secrets)

And Fannie Mae paid well. Clinton-era Democrats, serving as the CEO, CFO and Vice Chairman, paid themselves $200 million in only six years even while a $10 billion accounting scandal was exposed. (Source: Wall Street Journal)

And Democrats like Chris Dodd also got favorable loans under a "VIP program." Dodd alone saved over $75,000 on his mortgage payments. (Source: Conde Nast Portfolio)

So where are former Fannie Mae CEOs like Franklin Raines ($90 million in salary) and Jim Johnson ($21 million in salary in one year)? As you might expect, they're serving as Barack Obama's key economic advisers. (Source: Washington Post)

Hiring Fannie Mae's two former CEOs as economic advisers? Barack Obama: not ready to lead.

The President's $700,000,000,000.00 plan is a 'poison pill' designed to lead this economy into a depression for the next President's term.

There are no investors for the toxic paper our President wants us to 'buy and hold.' Failure to renegotiate the principle on these mortgages by the financial institutions is the cause of our economic mess and the failures that have already occurred.

Yes, we need to support the financial institutions. It would be much cheaper to have a Federal banking system than to blindly buy only worthless paper at more than fire sale prices.

The President's Financial Plan will work just as well as 'We will invade Iraq, confiscate the weapons of mass destruction, capture Saddam Huessein and the Iraqi people will lay down their arms and thank us.'

Secretary Paulson said this is a matter of confidence - that is trying to play a con game on the taxpayer.

A plan more like Warren Buffet's, a reward for less risk.

One of their main justifications for this "bailout" is that without it, banks will contract and loans will further dry up. That just goes to show how dependent on loans our society has become. People used to be able to make a decent living in this country. Now you can't even eat and put gas in your car without a stack of credit cards.

This is the inevitable result of an excessively materialistic way of life. Everyone needed an SUV, had to own a house, and had to buy a ton of plastic Chinese crap for their kids. It's just not feasible for large populations to maintain this forever, especially with the reality of Peak Oil in the very near future. I predict this bailout will only stall a significant change of lifestyle in this country. Inflation on dwindling resources is going to skyrocket soon.

As Bush gave that speech, I was further reminded of how he told us we had to invade Iraq or there would be mushroom clouds over an American city. How did that work out? Now just as he's leaving office, we suddenly need to prop up the banks. What about propping up the millions of Americans who have been getting foreclosed on for the last year. I guess the early victims of this "economic crisis" are SOL.

Bush warns 'entire economy is in danger' is a horrible statement, but does it mean GWB accepting the responsibility and failure for the mess? If he is, he should show leadership by just going.

It's amazing, watching European stock exchanges - and especially our own, the Oslo exchange - as the various news from over the Atlantic hits us. 1. The Rescue Plan is announced, reaction: Up we go by almost 9%. 2. The day after the day that was, reaction: Down by 2%.

Then 3. Buh appears on TV to tell us the world as we know it is coming to and end, reaction: "... ... oh, I didn't see that one, I was watching the nature channel."

The same Geo. Bush(DUBYA) says the economy is in grave danger NOW, that said only 2 weeks ago it was fine, WHAT THE HELL HAPPENED GEORGE IN 14 DAYS?

They are being deliberately vague about what will happen if these banks fail, but we do know that filthy rich senators and representatives are buying the story. There is something about these banks and financiers that are scaring this group of people that didn't scare them before, when the sub-prime crisis first hit the headlines. We got the "basically sound" mantra. People earning a million dollars a year were not bothered. Now they are. I don't think they are worried that the Chinese and Brits will be left holding bags of worthless I.O.U.s, this time things are hitting closer to home. Is it the value of the dollar? Could be, if they have loans in foreign currencies and earnings in dollars. Is it the fear of foreign take-over? Maybe that - the Norwegians were major stockholder of Lehman Brothers and they just let it sink. Are they afraid that a break-down will mean the end of US world domination? Are they scared that the break-down will reveal corruption in high places? Does it spell the end of democracy, meagre though it may be?

It's painfully easy to see that 700 billion dollars will buy a lot of schools, roads and bridges, mains, levies etc. which in turn would create a lot of new jobs. That's what some spent their money on, back in the 1930s. It's what those vicious socialist regimes in Scandinavia did, and they're still there today. ::Shudder::.

So, is it the downfall of raw capitalism that scares them the most, the fact that "the left" was right and they were wrong?