800 billion in your taxpayer money Are people really really…

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Posted by: garyfong1 Original: 9/19/2008 1:50 PM Views: 3351 Comments: 41 eProps: 30 Read Comments Post a Comment Back to Your Xanga Site

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2 eProps from: stuartallen phoetic benz57 bluesky93 jojothewiz GracieSpencer jacksonwholephoto LuLuLuChia Palin_is_HOT Robert37 fjblau lightinspiration danieljwatkins shotshot qnetx 0 eProps from: dualsub2006

Friday, September 19, 2008

800 billion in your taxpayer money
Are people really really this stupid?

The DOW finished up 369 points today. This is big news that makes a bunch of idiots happy. ARRRGH. First of all - what would it be if you figured in AIG crashing - before they replaced it with Kraft Foods? That's like taking the worst player off your team in a losing basketball game, and changing the score! Leave Enron and AIG in - then see what the DOW has done over time.

Plus - people are happy because the U.S. Government and other central banks have decided to inject HUNDREDS of billions of dollars of YOUR taxpayer money to bail out the system that the super rich hedge fund managers created - the people who are laughing their way to the bank - so that YOU the taxpayer can bail out the system.

Government shouldn't get involved, huh?

George Bush and John McCain said this week the economy is sound.

It's a period of stupid greed followed by stupid fear. Dan will say hey rather than bitch about this what is the solution? 1) there should've been oversight and regulation. If you create derivatives that go nowhere, and you create wealth that you can't even explain - that's complete bullshit. But while the party was going on, nobody stopped to say, "what's going on here?".

Who is at the helm? George Bush, the guy you all voted into office because he was going to stop abortion. How did that go for ya?

2) I would have said no bailouts. Oh they "had" to bail out AIG? Yes, until after the election! That was just a stopgap to delay something that cannot be fixed until real estate goes up again - and it's not going to! It won't hit 2005 prices for at least a generation or two. In fact it's going to fall. Once the government decides to subsidize risk - that is NOT a free market society! DO you hear this you silly conservatives? A government that has it's hands (ok fist) up an economy's ass is socialist. You are living in a system you say you hate, and on that we agree - we both hate it.

Lehman, Bear Stearns, AIG - Fannie Mae, Freddie Mac should all have failed on their own. I don't see the government bailing out troubled homeowners, do you? No, but they'll bail out rich investment banks.

If you vote for McCain - I thank you in advance because he's out for rich people - NOT the middle or lower classes. I remember when GW won the 2nd election, I was watching all of the happy fools jumping around in the midwest saying, "we won! we won!". Yeah you won alright. Eight years later... you won. Have mercy on you all if you "win" again.

Posted 9/19/2008 1:50 PM - 3351 Views - 30 eProps - 41 comments

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Did you see what happened in the UK this week Gary? If not Lloyds TSB bought HBOS because of their falling share price. It means that Lloyds TSB now control about a third of the UK mortgage/savings market. Plus people froget that on top of this Lloyds have access to Northern Rocks mortgage books. So when a customers deal finishes it will be Lloyds that will approach them with a new rate. That is a huge chunk of the market for one bank to control do you not think?

Plus on top of that I hear that HSBC is looking to buy WaMu and Barclays Bank are purchasing some of Lehman. It's getting difficult to keep up with it all at the moment.

Posted 9/20/2008 3:29 AM by stuartallen - - reply

What i like about following this blog is you put everything thing out in the open. We saw the two bedroom apartment up to the estate. You remember being poor to middle class now wealthy . The thing is some people forget about where they started and how difficult it was to reach the next level. Some forget about the struggles of their parents which enabled them to attain the wealth status. Among the 80-100 thousand readers of this blog I am sure most of their clientele is poor to middle class. Maybe only 1% of the 100,000 or more can say that their clients are millionaires. But if it were not for the poor many would not be wealthy.

I was reading that businesses are taxed less than individuals. The example showed if the company made 400,000 it is taxed at a lower percentage than an individual making 400,000. So the person paid himself 30,000 from the 400,000 which put him at a less tax bracket being 30,000 and paid himself 55000 dividends which is tax free. The lifestyle was being maintained by the business but not with 100,000 cars etc. I would love more information on this type of structuring.

Keep the poor in mind it will keep you wealthy. "When i thought of ways to help the poor people i remembered seeing in china play my board game is when i became rich". Robert Kiyosaki

Posted 9/20/2008 5:45 AM by phoetic - - reply

You're wrong, Gary.

Blame the Democrats. They are the ones who FORCED the banks to make loans to people who wouldn't normally qualify.

In a previous life, I worked on some software that helped banks comply with the "Community Reinvestment Act" compliance requirements. Well, we got what the Democrats wanted: millions of people owning homes who wouldn't normally qualify. When the market slowed down, the merry-go-round stopped and we're all left holding the bag. Remember, the banks were FORCED to loan to people who didn't qualify and it was a percentage of normal loans.

In 2003, Bush tried to stop the madness, but the Democrats fought back.

The bailout never should have had to happen. This is a perfect example social engineering trumping logic - and now we all suffer.

See this, "Root Cause":
http://directorblue.blogspot.com/2008/09/root-cause.html

Here's a simplified version, but a few minutes at the above link is better.
http://directorblue.blogspot.com/2008/09/obamonpoly.html

Posted 9/20/2008 7:27 AM by benz57 - - reply

So...are you renouncing the millions you've made since 2001?

Some of the extra money I've been able to put away since 2001 -- thanks to tax cuts -- I've been able to buy a few extra things like...you know...lightspheres, album design software, Gary Fong DVDs, Bullzeye Software just to name a few.

I think your personal economy is quite sound. You're welcome, man.

Posted 9/20/2008 7:29 AM by bluesky93

- - reply

Gary, I agree with you on this but you offer no alternatives. This taxpayer will not help in the bailout but my son will. The necessary money will be printed because it is not in reserve. Since we can't back up the money that we will print, we will rely on our credit. Our children will be responsible for this debt. This is a circle created by greed. For years, I have said that stock market is a house of cards. Paper value without substance. Men making money without creating anything. We have money changers in our temple.

JoJo

Posted 9/20/2008 7:32 AM by jojothewiz - - reply

Though I woke up the other day and finally had the thrill of knowing what it felt like to be part owner in an 85-billion dollar insurance company, let's remember the reasons this administration can't take on health care: why, it would be big government, and the cost! And hey, it might actually immediately do something for the average family. Oh no.

The bailout is socialized capitalism: private profit, with taxpayers -- yes, our kids, and their kids, and the planet -- covering the losses. What incentive is there is make good long term investments as opposed to short term gain that will be ruination in a decade?

I don't ever want to hear any of these people damn anything again as "big government." Please. Let's just admit that government is to be used for ALL of our benefit and find the same creative energy and political to address more issues than this one.

Posted 9/20/2008 8:02 AM by GracieSpencer - - reply

@GracieSpencer -

Had the government not done SOMTHING (and Gary only offers to bitch and complain when they do. He doesn't offer any alternative solution) then health care and all of that other stuff wouldn't have mattered. We came as close to Gary's 3rd world prediction as you can come without it actually happening. Yesterday could have been the end of the world as we know it.

Does it hurt? More than any of us know, it does hurt. Is it privatizing loss? Well, of course it is. Was there any other way to handle it and maintain the United States of America in any recognizable form? I don't see it, and neither does Gary.

You can blame Bush, the Republicans or anyone else that you want. There is clear and convincing evidence that there is more than enough blame to go around on all sides. Now, we have to deal with the mess and move forward. It's the only way.

And Gary, housing prices DO NOT need to go back to 2005 levels for a recovery to begin. First of all, the majority of housing markets in this country aren't off like California, Florida and some of the other hardest hit areas. I would opine that housing prices in these markets are what set off this bomb. Housing prices merely need to stabalize. That would mean that prices are reasonable for income levels in those markets, people credit worthy of a loan are getting them and most importantly that banks are making the loans. There is already some evidence that even though prices are down, housing sales are picking back up in California. A recovery? Hardly, it is a step in the right direction. Baby steps are what we need.

Posted 9/20/2008 8:32 AM by dualsub2006 - - reply

@dualsub2006 - Good point

Posted 9/20/2008 8:42 AM by jacksonwholephoto - - reply

gary, you and your readers would appreciate this movie. www.iousathemovie.com
oy this is all making me angry too!

Posted 9/20/2008 11:01 AM by LuLuLuChia - - reply

A couple good points, yet some mediocre to stale ones too.

Why cry 'socialist socialist!' but say we need Obama. He is the worst socialist of all.

The republicans are where the democrats were 40 years ago, the democrats have gone off the charts to the left.

Amazing that Uhbama has taken in the most $ in the last 3 years from Freddie/Fannie and put its head guys in charge of parts of his campaign. That should tell you something right there. He's politics as ussual.

Unfortunately for dems, they had a gimme this election, but the arrogant Uhbama threw Hillary under the bus, and that will prove his undoing.

McCain at least knows how to work across party lines to make things happen. Not to mention Sarah will be VP!

Posted 9/20/2008 11:03 AM by Palin_is_HOT - - reply

Greetings Gary.
So with the printing of the phantom money requested the the feds, the US will be devalued significantly. Will this factoring into a potential surge in the gold market ?

tnx for sharing your thoughts on this matter.

Posted 9/20/2008 11:03 AM by Robert37 - - reply

@Palin_is_HOT -

Obama's Undoing

With the money quote being:

"There is thus a reasonable inference that Obama's gains may, in part, be related to the way in which the public viewed his and McCain's response to the financial crisis."

Yeah you go with the economy. Its only going to elect more democrats, thankfully.

Posted 9/20/2008 11:19 AM by fjblau - - reply

There is plenty of blame to be shared by all policy makers over the last couple decades on this one -- but there truly is a better way to structure the bailout: leave the taxpayers out of it. I'm paraphrasing Robert Riech here: it makes sense to allow the banks to clean the bad loans and let a special agency sell the losses for as much as it can. But, just like in a bankruptcy that you or I would have to deal with, let the price of opting into the deal be that the banks lose the value of their equity, executives' pay is limited and they lose the value of their options. The money made from the sales go to the creditors. And use the power of government to restructure the industry, with new regulations regarding capital requirements, conflicts of interest & disclosures.

If taxpayers are on the hook for the whole deal and it doesn't go well, then we are toast.

This could actually lead to a time of restructuring for many industries, like health care. If we are putting it all on the table, let's be smart and do it right, and not keep making the same mistakes and sticking our kids with the tab. The world as we know it has ALREADY changed, but we keep proposing ideas from the same old playbook, to favor the same players.

And please, do not even suggest that Phil Gramm should be the person overseeing this country's economy -- he has lost all credibility to be even be part of the debate.

Posted 9/20/2008 12:21 PM by GracieSpencer - - reply

I'm voting for McCain because he will not raise taxes on the small businesses which I am, like Obama will. No matter who was in office, me being very lower class have never benefited for any tax breaks. I have no children and yet I have to pay higher taxes to support or fill in the gaps the tax break for children create which I object. It isn't Bush's fault on outsourcing. Clinton's administration is who signed the Nafta trade agreement giving HUGE tax breaks to the rich companies if they would send our jobs overseas to help out poor countries.

But remember the crash of 1987? This same thing happened in about 20 years it will happen again. Just a cycle people, just a cycle.

Posted 9/20/2008 1:18 PM by lightinspiration - - reply

"I'm voting for McCain because he will not raise taxes on the small businesses which I am"

Of course, under the Bush/McCain plan, you might have lower taxes. Just no customers with the means to afford your services.

Your call.

F

Posted 9/20/2008 1:24 PM by fjblau - - reply

I'm thinking...maybe you should run for a political office if you aren't happy with the way things are being handled.

Maybe you should volunteer to help out at a homeless shelter.

Maybe you should volunteer to teach skills to unemployed people.

Gary, you seem to have the time, the intelligence, and the resources to be able to make a difference in a lot of lives. So why are you wasting time criticizing George Bush and John McCain so often when perhaps you could be affecting a lot of lives in a lot more constructive manor. I'm not talking about selling more stuff to photographers who can afford to part with $40...I'm talking about...checking your ego, rolling up your sleeves, and picking up a hammer to fix what's broke.

Lead by example. Don't just say stuff...do stuff.

Posted 9/20/2008 2:38 PM by danieljwatkins - - reply

Daniel, I would say something if I knew the answers, but I don't. I'm not a politician so I don't need to say airhead phrases like, "I'm gonna shake things up!". :::sigh:::

I think we're going to probably collect information on building shelters and finding food in remote locations, or farming and agriculture. You laugh now...

Posted 9/20/2008 2:44 PM by garyfong1

- - reply

@GracieSpencer -

Phil Gramm wasn't the problem. The problem is the Democrats put wording in the big banking bill that Gramm and others worked on that forced the banks to make loans to people who didn't qualify for them. It started under Carter and was called the Community Reinvestment Act. It was sort of toothless until the Democrats added teeth in the 90's.

It all worked because the banks could absorb the bad loans. But it started to crack as the economy grew and more people were buying houses. In order to comply with the law, even more people who had no business getting loans were getting them. Bush tried to rein it in 5 years ago, but the Democrats fought him.

Read "Root Cause" here:
http://directorblue.blogspot.com/2008/09/root-cause.html

And guess who Obama has on his payroll? Yep, ex-Fannie Mae people.

Here's a list of top DEMOCRATS from Fannie Mae. The number listed is their compensation from 1998 to 2003.

CEO Franklin Raines $90,128,761
CFO Timothy Howard $30,155,029
Vice Chair Jaime Gorelick $26,466,834
CEO Jim Johnson $21,000,000

Now consider: two of Barack Obama's key financial advisers are -- yep, you guessed it -- Franklin Raines and James Johnson.

The New York Times reported this five years ago:

"The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago."

"Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry."

"The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios."

"The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac — which together have issued more than $1.5 trillion in outstanding debt — is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates."

The problem is the Democrats fought the clean up and thus we had the housing collapse that directly led into the current mess.

Liberalism and Democrats - again. They want to bring what they've done for DECADES to the inner cities to the rest of the country. McCain may not be perfect, but he's much better than Obama.

Posted 9/20/2008 5:42 PM by benz57 - - reply

i like how we are simple enough to just equate republicans with screwing things up and democrats with making them better.

that's fairly silly.

Posted 9/20/2008 8:53 PM by shotshot - - reply

also, note that i agree bush screwed things up. however, those two equations are ridiculous as generalities.

Posted 9/20/2008 8:55 PM by shotshot - - reply

If you are blaming solely Democrats for this disaster, then you have already drunken the kool-aid. Take a look at how this country has consistently been run into the ground over the last 8 years, and the most fundamental principles that make it different from others totally trashed. It's been a cynical ride. Time for all sides to get real, there is simply too much at stake now.

Whatever McCain was four years ago, he is operating as something else now. It's a shame, because he had some moments, and he may again but I do not believe it will be as President. Promoting ignorance, even attempting to enshrine it as your VP, will only take you so far. Then again, I could be wrong. I just don't think so. It's a cycle, and it's come around again.

This particular bailout, however, isn't just a cycle. As Alan Binder, former vice chairman of the Fed's board of governors, noted: "We're deep into Alice in Wonderland's rabbit hole." We are doing things we have never done before, and doing it quickly and without many details being public. Lack of transparency -- sound familiar?

Posted 9/20/2008 8:57 PM by GracieSpencer - - reply

And finally, speaking of transparency and accountability, two things we might want to promote for a change, how about this gem:
----
Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

Sec. 9. Termination of Authority.

The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall terminate two years from the date of enactment of this Act.

-----

Sure, take our $700B at a time, up to who knows what amount total, and do what you will, with no review, for two full years. Brilliant.

Posted 9/20/2008 9:25 PM by GracieSpencer - - reply

Lets just stick to the facts.

Sarah Palin is the hottest of the lot...

Not to mention, more experienced than Obama! LOL

Posted 9/20/2008 10:05 PM by Palin_is_HOT - - reply

@Palin_is_HOT -

Really. Is that the best you can come up with.

Because, it doesn't appear to be working. :)

Posted 9/20/2008 11:35 PM by fjblau - - reply

@fjblau -

Yeah, the Democrats in congress have done such a wonderful job over the last 2 years. Lower approval ratings than even Bush has, and not ONE of their promises kept. Not. One. Nothing on gas prices, Social Security, prescription drugs, health care, energy independence, college tuition, win/end the war in Iraq, border security, fiscal responsibility, alt minimum tax repeal, balanced budgets, killing earmarks, the 5 day work week or any of their other hollow promises. Again, research what Pelosi, Hoyer and the other Dem's had to say and then compare their list of promises with their list of accomplishments. VERY long list of promises, not a single one of them in the done column.

That's real "progressive" thinking now, isn't it. Go ahead and elect more of them. The less that gets done in Washington the better off we all are. I know you'll blame Republicans in Congress Frank. Go ahead. I didn't hear a single Democrat say, "if the Republicans will let us" when they were rattling off this agenda.

Posted 9/21/2008 6:04 AM by dualsub2006 - - reply

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