Monday, September 29, 2008
Sunday, September 28, 2008
Economy: How Washington and Wall Street got into trouble Timothy Lamer
The current financial crisis gripping Wall Street is head-spinning in its complexity. But economists and analysts have been able to identify several steps along the way that helped lead the country to where it stood last week, on the brink of a massive government program to buy hundreds of billions worth of bad mortgages. Here are some of the steps:
Step 1: Trying to avoid a recession brought on by the bursting of the tech bubble and 9/11, the Federal Reserve under then-Chairman Alan Greenspan began aggressively easing monetary policy. From 2001 to 2003, the Fed Funds rate fell from 6 percent to 1 percent, a 45-year low.
Step 2: With interest rates low and money easy, mortgage lenders started marketing loans to people with questionable credit histories. These "subprime" loans often required no down payments, had adjustable interest rates, and featured exotic elements like "negative amortization" (in which "homeowners" would initially pay less than the interest owed each month, causing the loan's principal to grow with each "payment"). With these loans fueling demand, housing prices rose, prompting speculators to enter the market and "flip" houses (buying them with debt and then selling them quickly at higher prices). A speculative bubble began to inflate.
Step 4: With investment banks using these subprime assets to take on high levels of debt, the financial health of Wall Street became linked to the ability of people with poor (or no) credit histories to make monthly house payments.
Step 5: Interest rates couldn't remain at historic lows forever. As interest rates began to rise, housing demand fell and the bubble deflated. Subprime borrowers found interest rates on their mortgages adjusting upward at the same time as the value of their houses either fell or flattened. Unable to make payments, many defaulted. Investment banks on Wall Street were left holding the bag—the bag being debt backed by assets with falling values.
Step 6: Fearing a full-scale collapse and severe recession, the Bush administration began engineering bailouts of some of these firms and, finally, proposed a $700 billion macro-bailout. Under the proposal, the Treasury secretary will buy the bad assets from the banks and then sell them. (How much the government makes selling them will determine how much of the $700 billion the government will recoup.) "This staves off judgment day," Anthony Sabino, professor of law and business at St. John's University, told the Associated Press. "This is a detox for banks, and will help cleanse themselves of the bad mortgage securities, loans and everything else that has hurt them."
The plan gives the Treasury secretary (currently Henry Paulson, most likely someone else in January) enormous power, which prompted a debate last week in Washington about how much oversight he or she should come under and how much time he or she should have to get the government out of the real estate business.
The fundamental dynamic is this: Washington and Wall Street helped people buy houses they could not afford on such a massive scale that simply letting the lenders and debtors take their lumps would arguably do grave harm to the economy. They will take some lumps (Wall Street isn't exactly a hot job market right now), but most of the losses will be "socialized," or spread out among everyone who pays taxes. This includes those who exercised restraint during the bubble. That's how it is.
Friday, September 26, 2008
Wednesday, September 24, 2008
We're prolonging the inevitable recession by wasting tax payers money based on the word of a Secretary of the Treasury that hasn't made a good decision yet.
Of the $700 Billion that will likely be approved by the Congress and President (at the request of Sec. Paulson), much of it will prop up a bloated housing market and continue to skew what real house values are. There will also be billions of dollars earmarked for various political causes that have nothing to do with the current financial crisis. That's how all bills that go before Congress turn out. This will be a monstrosity of epic proportions and in the end, we'll still have a recession unless the energy situation is rectified, the war spending begins to go down, capital gains taxes are dropped, etc. etc. We have to stop spending money we don't have.
But what do I know?
Monday, September 22, 2008
This highly edited and misleading video was posted by Brian on The Graze so it demands an explanation.
The event in view is a contest at Horn Creek family camp this past summer where two people sit on a swinging log and try to knock each other off with a pillow. Being a loving, caring husband who wants to build up the esteem of his wife and make her feel good about herself- I feigned defeat. The slow-mo replay reveals the finishing blow was actually just a slight graze incapable of knocking someone of my physique off a log. Clearly I took a dive for the sake of marital peace and longevity.
Despite my good intentions and humble act on that fateful night, Bob "Geraldo" Reymond and Brian "tabloid" Hough have posted this video depicting me as a sniveling, wimpy, loser and my wife as a gladiatorial victor gloating over her vanquished foe. A crafty edit job for sure, but none the less apalling for those who care about truth and justice.
Well, I am confident that you, my faithful and intelligent readership, will see the truth despite the journalistic hack job done by Hough and Reymond.
Wednesday, September 17, 2008
Tuesday, September 16, 2008
The Wizards played the Los Angeles Beckham's this past Saturday. Brian and I were at the game. KC won 2-0 with a spectacular rip from Davy Arnaud. The clip has the five best goals scored over the weekend in MLS, Arnaud's is the second on the reel.
Arnaud's shot is stellar, no doubt, however as a coach I can't help noticing the laziness of David Beckham that actually allowed the goal. He was far too casual in letting Arnaud dribble past him and in to space where he set up the 35 yard upper-90 shot. $15 million per year doesn't buy the effort it used to.
Beckham is WAY overrated.
I was not familiar with E. Dewey Smith before seeing a clip over on Semper Reformanda . I don't know enough about Pastor Smith to give any kind of endorsement, however I found this particular clip to be very moving.
This is a pastor who knows the culture and his flock's challenge in the midst of it. While his comments are clearly toward fellow African American men, what he says has application to all men.
Monday, September 15, 2008
Biden's Average Annual Charitable-Gift Total: $369
(The Chronicle of Philanthropy, Sept. 12, 2008)
Sen. Joe Biden and his wife, Jill, have given an average of $369 per year to charities during the past decade, according to tax returns posted today to Sen. Barack Obama’s campaign Web site.
Senator Biden, the Democratic nominee for vice president, claimed $995 in charitable gifts in 2007 on the joint return with his wife. That figure is 0.3 percent of the couple’s claimed income of nearly $320,000.
The 2007 contributions were significantly higher than the couple’s gifts in previous years, which ranged from $120 to $380.
By comparison, Sen. John McCain, the Republican Presidential nominee, in 2007 reported $405,409 in total income and contributed $105,467, or 26 percent of his total income, to charity.
Sen. McCain files a separate return from his wife, Cindy. The totals do not include Ms. McCain’s income or charitable contributions.
Sen. Obama, and his wife, Michelle, donated $240,000 in 2007, or about 5.7 percent of the couple’s $4.2-million in reported income.
Mr. Biden has been rated as the least wealthy U.S. Senator.
Alaska Gov. Sarah Palin, Mr. McCain’s running mate, has not yet made public her tax returns.
— Peter Panepento
Saturday, September 13, 2008
In no way do I wish to make light of the huge hurricane (Ike) being experienced by those who live in the Houston/Galveston area, however, get a load of this joker in the bear suit while a news station gives a report of the worsening conditions.
Friday, September 12, 2008
"Put on... Kindness": Kindness is action that reveals compassion, action that arises out of a sense of sympathy. Kindness comes forth from compassion. It can take many different forms-a smile, a kind word, a pat on the shoulder, an invitation to lunch, an offer of help, the provision of a need. By God's grace, I must put on compassion and kindness.
"Put on... Humility": Having a humble opinion of one’s self; a deep sense of one’s moral littleness. Lowliness of mind. John Stott rightly calls humility "the rarest and fairest of all Christian virtues." The chief Christian virtue is humility because it is the exact opposite of the worst of sins, which is pride. I am to put on humility, to think humbly of myself. This has to be by God's grace because I am hideously prideful and arrogant. As the apostle puts it in another place, I am to "regard others as better than ourselves (myself)."
In this light, I think my favorite words of Paul are- "I am the least of the apostles." (1 Cor. 15:9), "I am the very least of all the saints". (Eph. 3:8), and "I am the chief of sinners." (1 Tim. 1:15).
"Put on... Patience and Forbearance": Patience is longsuffering, the enduring of another's exasperating conduct without flying into a rage. A slowness in avenging wrongs. It is holding back, restraining yourself from becoming upset or speaking sharply or shrilly to somebody by our mate, your child, whoever whose conduct you find difficult and exasperating. Forbearance means to "bear with one another." This is similar to longsuffering, but it is the positive side. Literally it is "to uphold and support" someone. Not only to restrain yourself but to support others, encourage them.
"Put on... Forgiveness": Forgiveness is not being offended and just ignoring it or letting it go.
Forgiveness is exercised or granted when a sin has been committed and there is confession and the seeking of forgiveness by the one who does the offending. In such cases, I am called to forgive my brothers and sisters. Forgiveness means that I do not keep bringing up what I have forgiven! Forgiveness also means is that I do not tell anybody else about a matter that is forgiven. I should not gossip about it to others. I consider the matter resolved.
... bearing with one another and, if one has a complaint against another, forgiving each other; as the Lord has forgiven you, so you also must forgive.
The model for my forgiving others is the ultimate forgiver of all time- God, through Christ! A person who cannot or will not forgive has very likely NOT been forgiven of their own sins.
Putting on forgiveness absolutely requires that our sins be forgiven first, by God, through Christ. Since my sins have been forgiven, I must forgive others! We often think of the obligation of the offender, that he or she must seek forgiveness. Unrepentant offenders are certainly a blight to a community, but a great poison also is the person who refuses to forgive!
May the application of these verses be actualized in me and in you!
Thursday, September 11, 2008
Monday, September 8, 2008
Saturday, September 6, 2008
"Reasoned debate must replace the scaremongering of the green climate alarmists." John Woods of Friends of the Earth said Mr Wilson was "like a cigarette salesman denying that smoking causes cancer". "Ironically, if we listen to him Northern Ireland will suffer economically as we are left behind by smarter regions who are embracing the low carbon economy of the future." It is the latest clash between Mr Wilson and green groups since his appointment as environment minister in June.
Wednesday, September 3, 2008
Monday, September 1, 2008
I'm sick of the consistent Southern practice of ignoring of the greatest BBQ on earth (as evidenced by this video recently posted by Semper Reformanda).
Alabama, Tennessee, Georgia, Carolinas (who cares which one, their basically the same), Mississippi, Louisiana, Texas...ya'll ain't got nothing on KC BBQ! Quit the hatin'!
We all know the only thing common about Southern BBQ is 'Possum!