Before the Government goes bailing everyone out, they should consider the guys they don’t have to bailout and the impact it will have on their businesses.
Note: forgive this simplistic scenario but you’ll get the overall point. Let’s say you own a bank and you chose not to give out risky mortgages. And let’s say you also chose not to buy up other banks risky mortgages. You also choose not to invest your profits into mortgage bonds because you don’t know which are risky and which aren’t.
If you were a bank and you chose not to do those three things then you would be called an “idiot” by nearly everyone in the industry between say 2003 – 2007. Most of the other banks you were competing against were making millions of dollars on loans you refused to make. But, let’s say you managed to keep your bank open and were still turning a profit, not at the levels of other banks but still a profit.
Now, it’s 2008 and you look pretty smart. You are still turning a profit while your competitors are hurting and even going out of business which means their customers are coming to your bank. Great you are set! Wait, your competitors have hired lobbyist to fly to Washington to try and get the government to help them out. The government is broke so they say no but your lobbyists are smart. They start scaring everyone into thinking that if their clients fail then the whole system will fail and everyone (meaning voters) will suffer and blame those in congress. They also get newspaper columnists to write articles scaring the public into believing this scenario. Pointing out that “Joe Blah Blah” is at risk of losing his job and his money.
So Congress jumps on board. Now, the government is pouring money into your competitors even though they made bad business decisions. Your competitors survive and the bailout makes potential customers and investors more likely to actually throw their money into your competitors instead of your bank. Guess what? The Variables just changed and you were penalized for not being an “idiot”.
You go out of business and your competitors gobble up your bank only to make the same mistake again in 5 years. The executive boards and managers of those banks avoid any real damage and go on to repeat their mistake once again. After all, they made millions and when they started to face losses…government bailed them out. What’s the downside?
Or take that scenario and say you are an automaker or a builder or an airline.
Posted in bailout, Business, Day to Day Stuff, Deep Thoughts, Democrats, Economy, Housing, lending crisis, mortgage, Mortgage Industry, News, Politics, real estate, republicans, Stupid Things
Tagged bailouts, Economy, mortgage
I decided to actually watch CNN tonight to hear what all the pundits had to say about the bailout failing to pass. Let’s just say my head hurts now. Before I even get into the Dems and Repubs, it’s amazing to me that we only hear one side of this argument. Everything on the news is how the bailout just has to be passed and it was a major mistake not to pass it. What about the other side?
I even heard these morons say that yes the bailout is horrible but we just have to pass it. We do? Can’t we pass something else? Don’t we have the power to rewrite bills or make new bills that may work better? I seem to remember reading that in Government Class. CNN completely ignored the other side of the argument in all their newscasts tonight. It’s like I’m listening to the state run news network just repeating the talking points handed to them by the administration…strange feeling. This is the United States of America, right?
Ok, now on to Congress…Now let me see, I’ll start with the Repubs blaming Pelosi’s speech (her Speech!) for the bill not passing. Seriously?
- Did your feelings get hurt? How old are you idiots?
- Just once, just once, I would love to hear the Republicans take responsibility for their actions. Guys you failed to get the votes to pass this bill. End of story.
- They BLAMED THE SPEECH! They continue to just amaze me.
Ok now I’m going to rip the Dems…so any Democrats out there who can’t take it then you better look away.
- Pelosi why do you still have a job? Every day that you wake up do you look in the mirror and just ask yourself if you can screw up as bad as you did the day before?
- Did the Dems blame the Repubs for not getting enough votes? They said that they got their fair share and the Republicans didn’t get theirs. Are your legs broken? Get off your asses and go get more votes if you believe in this thing so much. WTF? That’s the weakest argument I’ve ever heard…oh wait. They blamed THE SPEECH!
So CNN went on to say that the house Republicans who voted against the bill were putting their re-elections ahead of the country. But, then they went on to say that 90% of the calls into those same Repubs offices have been against the bailout. Don’t they work for those people? Aren’t they supposed to represent them? I’m so sick of this crap about putting the country ahead of everything else…this is not the Soviet Union! You are free to have differing views here in this country. In fact, it’s healthy and natural.
The majority of American people do not support this bill and the congress who represents them voted it down. So what’s the problem? If it’s so important then explain it to the people of this country and stop trying to scare them into supporting it. I mean, I know that’s Bush’s only motivational tactic but someone in congress should be able to do something. How about those two idiots running for President? Maybe they could explain it to the American people. I’m pretty sure that’s how this whole thing called government was supposed to work.
And does anyone, anyone have a problem with the Democrats in Congress lining up behind President Bush on this?
I know this post is long but I got one more thing to say. Where is Dick Cheney? Where do you think his money is? Dubai?
Posted in Barack Obama, Business, Day to Day Stuff, Deep Thoughts, Democrats, Dick Cheney, Economy, George Bush, John McCain, Media, Nancy Pelosi, News, Obama, Politics, republicans
At least the BBC understands that everything the Bush Administration and Saakashvili spit out is far from the truth.
The Bush administration appears to be trying to turn a failed military operation by Georgia into a successful diplomatic operation against Russia.
It is doing so by presenting the Russian actions as aggression and playing down the Georgian attack into South Ossetia on 7 August, which triggered the Russian operation.
I would guess that at least 90% of Americans think that Russia started this whole thing. And John McCain is a moron if he truly believes the crap he says.
The Republican presidential hopeful Senator John McCain also sees in this conflict an opportunity to put Russia in the dock, declaring: “We are all Georgians now.”
We are not Georgians you fool. We are Americans. Most of our population has no idea where Georgia is and have no idea about the history of this conflict. And isn’t it interesting that one country who has a long painful history with Russia finds very little fault in the Russians.
Obama if you truly want to bring about change in this country, this would be a good opportunity. Help wake people up in this country.
Posted in Day to Day Stuff, Deep Thoughts, Democrats, George Bush, John McCain, Media, News, Obama, Politics, Presidential Candidates, Putin, republicans, Russia
You just can’t make things like this up:
The United States and Poland reached a long-stalled deal on Thursday to place an American missile defense base on Polish territory, in the strongest reaction so far to Russia’s military operation in Georgia.
What the hell is the US doing? They couldn’t be more obvious. Let’s see a deal that has been stalled for 18 months is all of a sudden agreed to after Georgia attacks the breakaway provinces and Russia responds.
Why are we picking a fight with Russia? And if you think this isn’t a big deal then let this soak in:
But the deal reflected growing alarm in countries like Poland, once a conquered Soviet client state, about a newly rich and powerful Russia’s intentions in its former cold war sphere of power. In fact, negotiations dragged on for 18 months — but were completed only as old memories and new fears surfaced in recent days.
Those fears were codified to some degree in what Polish and American officials characterized as unusual aspects of the final deal: that at least temporarily American soldiers would staff air defense sites in Poland oriented toward Russia, and that the United States would be obliged to defend Poland in case of an attack with greater speed than required under NATO, of which Poland is a member.
We are agreeing to protect Poland even moreso than our NATO allies??? What??? Who cares about Poland? And who created those old Cold War fears? Russia did not roll their tanks into Georgia unprovoked.
How long before Russia sets up their own missile defense system in Cuba or Venezuela? It wouldn’t be any different than what we are doing over there? This is really maddening. And the people of this country are just sitting and watching Bush drive us back into an arms race and worst case, another Cold War.
Posted in Day to Day Stuff, Deep Thoughts, Democrats, George Bush, John McCain, Media, Military, News, Obama, Politics, Putin, republicans, Russia, TV
What did she tell Saakashvili when she was there on July 9th?
Did she tell him that if he gained control over his entire country that we would ensure Georgia would get into NATO?
Did she tell him that if he attacked South Ossetia the US would back him?
And what about this:
About 1,000 US soldiers are training alongside an equal number of Georgian troops and an unspecified number of men from Azerbaijan, Armenia and Ukraine — all of which are members of the Partnership for Peace.
EUCOM called Georgia a key ally in the global “war on terrorism” and regional anti-terror operations. It is currently the third largest contributor of foreign troops in Iraq.
“Georgia’s geographic location also allows other allies and partners in the region to see the benefits of working with the United States,” it said.
So Condoleezza Rice was in Georgia a month before they tried to take back South Ossetia and on top of that the US was participating in joint military exercises with Georgian Troops. So why doesn’t the US media ask our government if they knew that Saakashvili was goig to attack South Ossetia? We need to find out how much responsibility we share in this. And I’m talking about deaths of civilians on both sides of this conflict.
Saakashvili gambled on a surprise attack late Thursday to regain control over South Ossetia. Instead, Georgia – a former Soviet state and current U.S. ally that wants to join NATO – suffered a punishing beating from Russian tanks and aircraft that has left the country with even less control over territory than before.
Why is our government provoking Russia? Don’t they work for us? Of course, the democrats are silent on this as well. Think how much damage has been done over the last 8 years in Russia/US relations. What a disaster George Bush has been.
I had hopes for him but he continues to disappoint me with his short-sightedness. He appears to be caving on offshore drilling and now he wants to tap into the strategic oil reserves.
Obama, who as recently as last month argued against tapping into the petroleum reserve located in caverns in Texas and Louisiana, proposed that the government sell 70 million barrels of oil from its stockpiles and said that releases from the reserve in the past have lowered gas prices within two weeks.
Someone please explain to these idiots that this is a terrible way to deal with high oil prices. This will only offer short term relief and will only leave the country in worse shape when those 70 million barrels are exhausted. The strategic reserves are there for a reason. How do you think the military functions without gas? You think those tanks and planes work well without fuel? What happens if we attack Iran and then they respond by blocking the sea lanes of the gulf? Or maybe there’s unrest in Saudi Arabia or Pakistan? Or Venezuela sells all their oil to China? Let’s just say oil will be hard to come by.
I love how the AP hides this in the article….The last sentence of that story is the following:
Elgie Holstein, an Obama energy adviser, said that, while fewer refineries now are capable of refining the heavier stuff into gasoline, in the future that won’t be the case.
So the oil that will be replaced will be even tougher to turn into gasoline. Great! That’s just makes the idea even worse. You know, because if you really are in need of tapping the strategic oil reservers you probably don’t need the stuff quickly or anything. And “in the future”? What kind of timeframe are you talking about? When are these new refineries going up?
I suggest whenever you read an AP story that you make sure you read the last paragraph as that’s where they hide the good stuff. Don’t overlook it. And my message to Obama:
If you want to be so much like McCain then just quit the race and vote for him.
Posted in Barack Obama, Day to Day Stuff, Deep Thoughts, Democrats, Economy, John McCain, News, Obama, Politics, Presidential Candidates, republicans
How are you going to back up the 100 year statement now:
The killings of three U.S. soldiers in separate attacks in Baghdad pushed the American death toll for April up to 47, making it the deadliest month since September, the military said Wednesday.
How much longer do we have to continue before someone is strong enough to say enough is enough?
In all, at least 4,059 members of the U.S. military have died since the Iraq war started in March 2003, according to an Associated Press count.
That doesn’t include the wounded, the seriously wounded, and the emotional impact on the soldiers and their families. How many years do we continue down this path? Please tell us again how the “surge” is working? McCain basically said he judges success on the basis of how many of our soldiers are dying or getting hurt…well this has been the bloodiest month since September so doesn’t that mean the “surge” has failed?
I don’t think Republicans are going to stick this war out with McCain. They aren’t blind and they realize that it’s negative impacts far outweigh any positives. The Democrats know this but are too weak to do anything about it. Obama should seize on this but he’s too scared to do anything bold right now.
- Stop Bashing Patraeus
- Is McCain Crazy?