Archive for November, 2008
Two months ago, the United States Congress passed, and the President signed, the “Great Bailout of 2008″. The Troubled Asset Relief Program, or TARP, was created to provide up to $700 billion of taxpayer money for use by the Treasury Secretary.
Administration of the TARP includes the purchase of mortgage backed securities as well as a program to purchase whole loan packages from regional banks to free up credit on the regional level. According to the Treasury Secretary, these programs will ensure homeownership preservation as well as increase the availability of credit to small businesses and individuals. The TARP also includes an equity purchase program and a program to establish insurance for troubled assets.
While lawmakers in Washington and members of the mainstream media want you to focus on the AIG bailout, the rescue of Bear Stearns, the takeover of Fannie Mae and Freddie Mac, and the latest bailout of Citigroup, I think you should take a look at the list of banks that have received funds or are in the process of doing so.
I find it quite ironic that some banks, which purchased other banks recently, are now on the list for a government handout. Would they have needed the handout if they hadn’t spent all their money purchasing banks that needed to fold in the first place?
The list below, which I found at the CNNMoney website, includes a list of the companies that plan to take part in the government’s TARP program. It’s a massive list of approximately 130 banks, and you’ll be shocked by some of the names on the list.
John Hawkins, from Right Wing News, conducts polls throughout the year and I am one of the fortunate right-of-center bloggers who is invited to participate in those polls. I’ve been really busy over the past couple weeks and did not get a chance to respond in time to a few of his more recent surveys, but I was able to participate in his latest one, “Right-Of-Center Bloggers Select Their Least Favorite People On The Left“.
In this poll, we were instructed to put together an unranked list of 1 to 12 of our least favorite people on the left, or perceived to be on the left. We could include politicians, journalists, bloggers, pundits, radio show hosts, or anyone else we so desired. The field was open. It didn’t take long for me to make my list and send it off. After sending it, I realized I had forgotten to add one name on the list, and I had only included eleven people. That’s what I get for rushing to get it done.
I was surprised, however, to find all but one of my choices on the final list. That’s quite impressive because my choices don’t always line up with other right-of-center bloggers, and most of my answers don’t usually make the final list. Either I was really in tune with my “inner-right” this weekend, or the people who made the list of “least favorite people on the left” really are that bad.
The one entry I made that didn’t make the list was “Mainstream Media”. I know, my answer was too broad and covered too many people. In all honesty, I didn’t expect to see that one on the list anyway.
So who did make the list? Who is the least favorite person on the left?
Last week, while the federal government continued tossing life jackets to other members of the financial community, Citigroup hit an iceberg. Everyone heard the unique crunching sound that is made when a ship smashes into ice. Then again, maybe it wasn’t ice crunching as much as the cash in our wallets shrinking in value as the feds printed more money to handle the ongoing crisis.
On Tuesday afternoon shares of Citigroup closed at $8.36 on the New York Stock Exchange. By Friday afternoon those same shares were worth just $3.77. Shareholders lost more than 55% in 72 hours. Like investors at other banks and investment firms before them, the investors at Citigroup were shocked to learn that Citigroup had also sunk a lot of money into very risky investments.
Citigroup is in trouble, big trouble. As Congress debated the Great Bailout of 2008, many pundits were asking, “How big must a company be to be ‘too big to fail’”? Apparently, we know the answer to that question. ‘Too big to fail’ is now defined as bigger than Citigroup. We’re just not sure how much bigger.
As late as Sunday afternoon, the White House said they were unaware of any rescue talks, but hours later we learned a deal had been in the works for days. It appears the feds will be investing quite a bit of pocket change in Citigroup to go along with all of the other investments they have made over the course of the past few weeks. But just wait until you hear what the feds have planned to help keep Citigroup from sinking.
When it comes to politics, I never expect the candidates to uphold all of the promises they make while on the campaign trail. Call me a realist, but I know it’s impossible for someone who has no idea what the job will entail to make promises on how they will do that job before they actually get it.
Presidential candidates have no idea what it really means to be President of the United States until they win the election and are brought up to speed on what’s really going on in the world. There is no other job in the world that can help them prepare for their first national security briefing. They have no idea what it takes to be, or what needs to be done as, president. If they knew what it took they would never want the job in the first place.
Over the course of the past two years we heard three words. They became the focus of Barack Obama’s campaign for the presidency.
Hope, change, and inspiration.
For two years Barack Obama promised to fill our lives with hope. He was going to bring new hope and vision to the Oval Office. For two years he promised to bring change to Washington, D.C., he said there would be no more business as usual. He spent two years inspiring people to believe he was the man that would change everything. He inspired enough people to be elected the 44th President of the United States.
Now, reality sets in.
Three weeks ago we learned that the average American citizen does not have standing to bring a lawsuit requesting that Presidential candidates prove they meet the qualifications to hold the office, as defined by the U.S. Constitution.
According to Judge Surrick, citizens don’t have this right, voters (also citizens mind you) don’t have this right, and party members (citizens as well) don’t either. But if Congress (comprised of citizens) decides we should have this right, then they would have to pass new laws to grant us that ability. So, if we don’t have it, who does have this right? Our government (ie: citizens) is comprised of the people, by the people, and for the people. Who, but the people, should have this right?
We were left wondering at the time… Who does have standing to bring such a lawsuit? What about Presidential candidates running for the same office? Don’t they have standing to bring such a question to the table?
I must point out that none of this would be happening, and there would be no questions if President-Elect Barack Obama would simply release a certified copy of his birth certificate for everyone to see. That one simple act would prove all the naysayers wrong, and would put an end to all this speculation that he might not be a natural born citizen of the United States.
On November 12th, American Independent Party candidate Alan Keyes, along with Wiley S. Drake, the vice-presidential candidate filed suit to prevent the state of California from certifying their electors until satisfactory proof is produced that Barack Obama is a natural born citizen.
A month and a half ago, on October 3rd, our Congress opened the gate and led our country down the path in it’s first steps toward socialism. The Great Bailout of 2008 was touted as the “rescue plan” that would save our country from certain economic demise, while giving our government control it should not have. The measure passed handily with a majority of Senators (including both Presidential candidates) and Representatives attempting to assure the American people that this path was the only way out.
Leading up to its passage, Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke lobbied heavily for the plan. They both said we had no other choice. They both said if we did not act quickly, we were doomed. It turns out, they were wrong. Apparently we didn’t need to venture down this path.
To date, $290 billion has been committed by the Treasury Department. $125 billion has gone to the nation’s nine largest banks and investment banks. Another $125 billion has gone into regional banks, and $40 billion was added to the original AIG bailout. Under the terms of the Great Bailout, the Treasury Dept. can spend up to $350 billion before asking for an additional $350 billion more from Congress. That leaves $60 billion to spend, and today we learned that the original bailout plan isn’t going to work.
They told us this plan was the only way to solve the problem. They told us if this plan did not pass, we were going to lose more than our shirts. Does this mean we have lost our initial $290 billion? What do they mean it’s not going to work? Does this mean we are heading for hell in a hand-basket?
In 1918, on the 11th day of the 11th month at the eleventh hour, the Allies and Germany signed the armistice that brought an end to the hostilities on the Western Front and marked the end of fighting in World War I. The war officially ended on June 28, 1919 with the signing of the Treaty of Versailles.
In 1919, President Woodrow Wilson proclaimed the first Armistice Day to remember those who were killed during the war. People around the world took time out of their day, each November 11th, to recognize those members of their armed forces who died during the war. In 1938, Armistice Day was made an official U.S. holiday as “a day to be dedicated to the cause of world peace and to be thereafter celebrated and known as ‘Armistice Day’.” Years later, new legislation changed the name to Veterans Day and it became a day to remember all of the men and women who have served our nation in the Armed Forces, not just those who died.
Veterans Day is a day to thank and honor all of the men and women who have served in our nation’s military, during peacetime and war. It is a day to acknowledge that their contributions to our nation are appreciated and the sacrifices they made to serve their country did not go unnoticed.
Every Veterans Day I think about the men and women in my own family who served our nation proudly.
On September 16th, 2008, the United States government agreed to ‘bailout’ American International Group (AIG). The reason given to taxpayers for this decision was to “save financial markets and the economy from further turmoil”. Since that day in September, all we have seen are sluggish financial markets and economic turmoil. The American taxpayers have been left wondering if they really needed to bail out AIG in the first place.
AIG is the world’s largest insurer, and we were told that allowing the company to fail would have had a detrimental affect on financial markets. Over the past few months, the government has bailed out big companies like Bear Stearns, Fannie Mae, Freddie Mac, and AIG, yet they allowed one of the largest investment banks, Lehman Brothers, to go belly up. How did they decide which companies were worth saving and which ones were not? We have no way of knowing how each decision was made, but it’s clear that the government was not interested in spending money on every business that needed help and we are to trust that they made those decisions in the name of financial market stability.
Less than a month later, the U.S. Congress passed the “Great Bailout of 2008″. That bailout, unlike the others, required congressional approval, but like all the others, was passed with the promise to restore confidence in the credit industry, stabilize the market, and save us from even greater financial ruin. Only this time it cost a heck of a lot more than all the others combined.
When Congress passed the Great Bailout the American people were re-assured there would be transparency so they would know how much of their money was being spent, and where that money was being spent. So far, that hasn’t happened.
Three days ago, Barack Obama was elected the 44th President of the United States. In the 72 hours since his election, the stock market has dropped about 1,000 points, the unemployment rate has skyrocketed, and U.S. automakers burnt more cash that you would ever see in a hundred lifetimes.
There is no doubt, when President-Elect Obama takes office, he is going to have his hands full. There are still a lot of questions about how he will manage the current economic crisis, as well as how he will handle the foreign affairs situations like the one being proposed by Russia.
Today, he held his first press conference, which I found quite stiff and orchestrated. I did have one question before the press conference even started, though. Since when do we have an “office of the President-Elect”? Yes, his title is President-Elect, but since when did that include the term “office of” in front of it?
He will not be sworn into office until January 20th, 2009. Until then, he has no authority. No matter what happens with the U.S. government between now and then, he has no power to make decisions, he has no authority to change a single thing, in fact, he can’t really do anything at all. So why are they calling it an “office”?