Surviving the Panic

We're happy to report that the world didn't end yesterday, though sometimes it was hard to tell. A major Wall Street banking house filed for bankruptcy, the taxpayers didn't come to the rescue, and financial markets lurched but didn't crash. Amid the current panic, this is a salutary lesson that our fate is in our own hands and that a deeper downturn is far from inevitable.

The immediate priority is to calm markets and prevent a crash, and to do so it helps to recall how we got here. We are not living through some "crisis of capitalism," unless policy blunders make it so. Nor is this largely the fault of the Bush Administration, as Barack Obama claims, or of some lack of regulation, as John McCain asserts. These politically convenient riffs do nothing to reassure the public.

The current panic is the ugly aftermath of the credit mania that took flight in the middle years of this decade. As students of economic historian Charles Kindleberger know ("Panics, Manias, and Crashes"), financial manias throughout history have shared one trait: the excessive expansion of credit. This bubble was no different...

[Recommended > ]

READ MORE

The Real Culprits In This Meltdown

... Tough new regulations forced lenders into high-risk areas where they had no choice but to lower lending standards to make the loans that sound business practices had previously guarded against making. It was either that or face stiff government penalties.

The untold story in this whole national crisis is that President Clinton put on steroids the Community Redevelopment Act, a well-intended Carter-era law designed to encourage minority homeownership. And in so doing, he helped create the market for the risky subprime loans that he and Democrats now decry as not only greedy but "predatory.

While government arguably has a role in helping low-income folks buy a home, Clinton went overboard by strong-arming lenders with tougher and tougher regulations, which only led to lenders taking on hundreds of billions in subprime bilge.

Market failure? Hardly. Once again, this crisis has government's fingerprints all over it.

[until that time lenders, in typical actuarial fashion, ran the numbers and learned that some neighborhoods simply were to high a risk of not being paid back - and so were 'red lined' to exclude from loans.

A 'disproportionate' number of the neighborhoods were predominantly black. Naturally, 'redlining' was deemed racists, and the rules loosened to have Fannie (predominantly) buy such loans.

Yes there's more to it - but that was the first domino that fell into the others: government interference]

The solution? More government?]

READ MORE

A manufactured crisis

Had some of these individuals attempted to get a mortgage in say, 1993, they would have been turned down flat. The difference is that Bill Clinton became President of the United States in January of 1993 and upon taking office wondered out loud why so many poor people and visible minorities didn’t own their home and what could be done to change this situation.

Naturally, the good people at Treasury and Justice didn’t want to disappoint the new president, so they put the word out to financial institutions that the U.S. Government would really like to see more low income and visible minorities achieve the American Dream of homeownership. That many individuals among these visible minorities were financially unqualified didn’t appear to matter either to the government of the day or to the bankers who advanced the cash. [they didn't advance cash: the sold the mortgage to Fannie - and the taxpayer assumed the (normally prohibitively high) risk.]

The second part of the crisis is due to good old American ingenuity, as those bankers who were urged by their government to lend money to anyone and everyone saw an opportunity to take these so-called sub-prime loans and package them into investment vehicles...

[as I said, more than one domino - but the one that started it all?]

READ MORE

[btw:] "The current “correction” that both the real estate and the financial markets are undergoing will be relatively short lived, as the basic U.S. economy is sound. It’s not like Americans have lost their capacity to produce."

Pelosi: Dems bear no responsibility for economic crisis

House Speaker Nancy Pelosi, when asked Tuesday whether Democrats bear some of the responsibility regarding the current crisis on Wall Street, had a one-word answer: ''No.'' Pelosi (D-Calif.) ripped President Bush’s ''mismanagement'' of the economy and a lack of regulation that led to the current situation.
READ MORE
.

No-Energy Nancy’s Phony Energy Plan

Our friends at the Institute for Energy Research (IER) posted a devastating exposé of the Pelosi plan. As announced last week, the plan would:

• Permanently ban access to about 97 percent of the undersea oil lying within 50 miles of the California coast.
• Continue the ban on energy production in the Eastern Gulf of Mexico.
• Impose a brand-new ban on oil and gas leases in Alaska’s coastal waters out to 50 miles.
• Not allow states that approve new leases beyond 50 miles to share royalties with the federal government, thus stripping any financial incentive for states to stand up to environmental pressure groups, who will continue to agitate against any new oil and gas operations offshore.

The plan also includes poison pill provisions that President Bush is on record as opposing, such as new taxes on oil companies and a first-ever nationwide renewable-energy production quota for the electric power sector.

Nothing puts Pelosi’s charade in clearer focus, though, than IER’s charts showing how much oil the plan would lock up off the U.S. West coast.


By banning new leases out to 50 miles, the Pelosi plan would permanently deny access to 100 percent of the technically recoverable oil off the coasts of Washington, Oregon, Northern California, and Central California, plus 95 percent of the oil off the coast of Southern California.

Pro-drilling lawmakers on the Hill would be well advised to wave these charts in front of the television cameras as often as possible.

[I.e., all blue stuff (and red stuff), permanently off-limits - nothing states could do even if they wanted to {Fed. law trumps State desires}.

I.e., it's sabotage to our nation, plain and simple. It will be very interesting to see how the old media portrays this subversive bill...]

READ MORE

Records show McCain more bipartisan

ANALYSIS: Sen. John McCain's record of working with Democrats easily outstrips Sen. Barack Obama's efforts with Republicans, according to an analysis by The Washington Times of their legislative records.

Whether looking at bills they have led on or bills they have signed onto, Mr. McCain has reached across the aisle far more frequently and with more members than Mr. Obama since the latter came to the Senate in 2005.

READ MORE

Obama's missing years

Now that we've had full field MRIs of Palin, her family and their pets, perhaps the media could focus on the many missing aspects of Obama's bio.

Tom Maguire noted that we know virtually nothing about his time in NYC when he was attending Columbia (where no classmates seem to remember him and we have no transcripts or other records of his attendance there). Dan Riehl notes why we should be especially concerning about those missing years.

By 1980 at Occidental Obama ran partly with a circle of wealthy, drug using Pakistani friends. He traveled to Pakistan between Occidental and Columbia in 1981. That was during the Second Military Era (1977-1988) - Pakistan was under Sharia Law and not the most welcoming to foreign visitors, especially without some graft or connections. Based upon documented accounts, Obama seems to have also travelled the country-side, not just in the cities...

For a college kid out of California via Hawaii who ends up in a NYC slum via Pakistan partying with admitted drug users - using well beyond what Obama has ever admitted to, especially given the particular era, that Pakistan voyage is one very curious trip no matter how you slice it. And I don't mean for any possible Muslim/terror related reasons...

READ MORE

Palin and the 'Experience' Canard

When Coolidge was named to Warren Harding's ticket in 1920, he had been governor of Massachusetts for less than two years. His chief previous government experience was as mayor of Northampton, to which he was first elected in 1910 by a Wasilla-like margin of 1,597 to 1,409.

Another year-and-a-half governor to be nominated for the vice presidency: Teddy Roosevelt. It's true that TR, as a former assistant secretary of the Navy, though one wonders what today we would make of a candidate whose proud boast was that he had killed an enemy soldier "like a jackrabbit."

Then there is Harry Truman.

"He had only to open his mouth and his origins were plain,"

wrote David McCullough in his biography of the 33rd president, in lines that might also have been written about Mrs. Palin.

"It wasn't just that he came from a particular part of the country, geographically, but from a specific part of the American experience, an authentic pioneer background, and a specific place in the American imagination."

The Truman comparison seems especially to rankle Mrs. Palin's critics, perhaps because in many respects it rings true. Take vetting. John McCain may have met Mrs. Palin only once before he offered her the job, but Franklin Roosevelt admitted "I hardly know Truman" in July 1944, the same month the "Senator from Pendergast" was put on the Democratic ticket. [snip]

But as a man who knows whereof he speaks recently observed;

"You can argue that nobody is ready to be president. You can argue that even if you've been vice president for eight years, that no one can be fully ready for the pressures of the office."

Wise words, and historically true. If Bill Clinton can offer such a benediction to an inexperienced candidate, surely Mrs. Palin's critics can do so as well...

READ MORE

'VEEP' PALIN'S 'SPECIAL' DUTY

WASHINGTON - Sarah Palin yesterday offered the first hints of the role she would fill in a McCain administration, saying she intends take on the country's energy needs, reform government and promote care for special-needs children.

"My mission is going to be energy security and government reform. And another thing near and dear to my heart, it's going to be helping families who have special needs and children with special needs,"

[Deal.]

READ MORE

Yesterday -- after 19 months commanding American troops in Iraq -- command of U.S. forces passed from General David Petraeus to General Ray Odierno.

This nation owes General Petraeus our gratitude. As the person responsible for directing the "surge," he understood, when others doubted, that victory in Iraq was possible.

General Petraeus, and those under his command, have taken the fight to Al-Qaeda in Iraq and have them on the run. The achievements of our military in Iraq are unparalleled in the history of counterinsurgency warfare and will be studied and written about for generations.

I thought you would appreciate this farewell letter from General Petraeus to the troops. His words are worth our time.
.

Why Is Media Ignoring Accusations Obama Interfered With Iraq Withdrawal Negotiations?

While the media use all their resources to hunt fake scandals on Sarah Palin, there are some serious developments that America needs to know about.

The accusation from the Iraqi Foreign Ministry is that Barack Obama attempted to undermine troop withdrawal negotiations when he made his publicity trip to Iraq. For some reason, we have heard very little reporting on this from the media, even after Obama practically admitted to this.

READ MORE

[FLASHBACK: NNBrief 9/16/08 = OBAMA TRIED TO STALL IRAQ WITHDRAWAL ]
.

Countering the Drift

.
President Ahmadinejad of Iran, who plans to come to New York City for the opening session of the United Nations General Assembly from September 18 to 21. Yet the seventh anniversary of the September 11 attack on this city showed that many are content to forget the horror of that day and are intent on replacing the majestic twin towers with two gigantic, flower-strewn potholes. [snip]

Not long ago there was an anti-war rally in Times Square protesting a possible war with Iran. I asked my Persian dissident friend, who knows more about what's happening in that country than any newspaper pundit, what he thought about this. He told me that the Iranian mullahs have lobbyists here in the United States that organize such gatherings to sway public opinion. [snip]

We need to improve our communication here as well because many regard the truth as "scare tactics." The Democrats charged that the Republican convention exploited September 11 by showing graphic footage of the attacks. Wrong. We've grieved for seven years, and now it's time to focus on making sure it never happens again.

Next month when that Free Iran flag flies over Ground Zero, let's add one that reads: "Rebuild the Towers Now."

READ MORE

State budget relies on sham revenue

California

Remember those Democrats who promised to end years of deficit borrowing and bookkeeping trickery with a straightforward budget that raised taxes to cover obligations? Never mind. They embraced a get-out-of-town scheme that's the antithesis of common sense budgeting, and hid most of the details until the last minute.

Remember those Republicans who made noise about not raising taxes, even temporarily, because they would damage an already declining economy? They opted for siphoning billions of extra dollars out of Californians' paychecks through "accelerated withholding" – money we won't get back until our tax refunds of 2010.

Remember Gov. Arnold Schwarzenegger, who vowed never to sign a budget unless it had "reforms" to end the cycle of deficits and debts? The budget that's headed his way not only does virtually nothing to preclude future deficits, but probably would make them worse.

If Californians needed even more evidence that their state government is completely and irrevocably dysfunctional, those they elected to high state office provided it with easily the worst budget in memory [snip]

"This year's budget deadlock shows better than perhaps any other recent event that our state needs a constitutional convention to fix a governance system that is hopelessly broken,"

said the council's president, Jim Wunderman.

"The defining feature of this budget is that it only makes next year's budget worse, and 'next year' is only nine months away.."

READ MORE

A New Low in PDS: Palin Not Tough Enough on Rape?

The latest symptom of Palin Derangement Syndrome may be painting the female governor as an enemy of women, and it's not just vis-a-vis the typical pro-choice talking points.

In his September 15 article, ABCNews.com's Justin Rood looks at how "Critics Question Palin's Record on 'Epidemic' Rape, Domestic Violence in Alaska.":

"Evangelicals and social conservatives have embraced McCain's vice presidential pick for what they call her "pro-family," "pro-woman" values. But in Alaska, critics say Gov. Sarah Palin has not addressed the rampant sexual abuse, rape, domestic violence and murder that make her state one of the most dangerous places in the country for women and children."

The evidence Rood found for Palin being oblivious to or apathetic towards sexual violence and domestic abuse?

She didn't spend enough tax money on the problem: ...

READ MORE

The real barracuda

HERE is a titbit for you. I am sure you all heard the quip vice-presidential nominee Sarah Palin made before the assembled multitudes at the Republican convention in Minnysooda last week. "You know the difference between a hockey mom and a pit bull?" she asked. Then she did a nice take, paused, pointed to her mouth without changing expression: "Lipstick."

Biggest laugh of the night.

The titbit? That line was not in her speech. She stuck it in there when mentioning her start in politics as a hockey mom joining the parent-teacher association. In fact she went off book so much, and so far, that the teleprompter operator went half mad trying to find out where he had messed up. Finally, just before taking his cyanide capsule, he realised his text and her speech had the similarity of Saturn and a lawn chair, so I hear he just turned it off...

[her debate with Biden is Oct. 2nd]

READ MORE

Chavez slams critics for downplaying alleged plot

CARACAS, Venezuela — President Hugo Chavez reprimanded skeptics on Sunday for questioning his warnings that Washington is out to kill him — an accusation that Venezuela's opposition dismisses as a ploy to distract attention from domestic problems such as rampant violent crime and corruption.

(Snip) "Those who talk about it try to ridicule the allegation. (Snip) "Some say it's a farce." "They don't care about my death," ...

[is that a multiple-choice question?]

READ MORE