Panetta's weekend commute costs as much as GSA Vegas junket - 0 views
Why Mark-To-Market Accounting Rules Must Die - Forbes.com - 0 views
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Good explanation of this 2007 FASB accounting rule that wrecked havoc in September of 2008 when GSA subprime mortgage giants Fannie Mae and Freddie Mac both failed. When the bottom fell out from under the government backed securitized mortgage pools, banks were forced by this accounting rule to radically downgrade their assets. Since banks can only lend against their assets using government controlled ratios, as the asset value was marked to a market decimated by Fannie and Freddie failures and falling housing values, this accounting rule triggered the failure of Lehman Brothers. Because of credit default swaps used to insure these thought to be publicly guaranteed securities, the Lehman failure triggered a massive default at AIG as all Lehman security holders filed insurance claims. What a mess. The authors here propose an end or at the least suspension of mark-to-market accounting rules as an immediate solution. ".... In the 1930s, because mark-to-market accounting existed, we limited the amount of time available to fix problems. At the same time, the U.S. raised taxes, increased spending and economic interference, and became protectionist. This hurt growth. The reason the Great Depression was so bad is that we took away time and growth.
CONSERVATISM IS CALLING - YouTube as good as it gets! - 0 views
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Really well done video presentation concerning the presidential election, now just four days away. The first half races through Obama's mess, with excellent graphics and video clips portraying the fiasco. The second half is focused on Romney and his plan to clean up the mess Obama has left to him. Courtesy of the Bay Area Patriots Group
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So the idea is to have the taxpayers create a toxic asset market enabling banks to dump their crap at above market prices, with taxpayers takign the hit. This hit is masked by a tricky equation; Taxpayers will put up 97% of the funds for the overpriced purchase of crap, with private sector banks, hedge funds, and bond holders contributing 3%. Such a deal!
Heads the banks and Hedge funds win; tails the taxpayer loses. And loses to the tune of over $10 Trillion. GSA wonderkinds Fannie and Freddie have put $5 Trillion of securitized mortgages into the secondary money markets. Leverage that out at 40 : 1, and you have a $200 Trillion problem. Hummm, $10 Trillion looks cheap. "....I am filled with despair, not because what we are doing cannot "work", but because it is too unjust. This is not my country. The news of today is the Geithner plan. I think this plan might work very well in terms of repairing bank balance sheets...." Of course the whole notion of repairing bank balance sheet is a lie and misdirection. The balance sheets we should want to see repaired are household balance sheets. Banks have failed us profoundly. We want them reorganized, not repair