Lucid Links (042009, Morning)
Noteworthy Net-Worthies:
“(SC Congressman Gresham) Barrett booed at Greenville Tea Party” (HT Hot Air). Wow. Lefties pretending that this is some kind of GOP/Fox News plot will be giving this the “la-la-la, I can’t hear anything” treatment.
Speaking of people who supported the original TARP bailout, I hope there are legitimate sensible constitutionalists (my term describing a person who is genuinely conservative) out there in each and every congressional district in Ohio ready to challenge each and every congressional incumbent who voted for TARP, the mislabeled “stimulus” package, or both. My review of the roll call votes (TARP; stimulus) indicates that these Ohio congressmen let us down once or twice: Driehaus (1st), Schmidt (2nd), Wilson (6th), Boehner (8th), Kaptur (9th), Kucinich (10th), Fudge (11th), Tiberi (12th), Sutton (13th), Kilroy (15th), Boccieri (16th), Ryan (17th), Space (18th). Yes, that includes ordinarily great American John Boehner, who blew it on TARP.
Speaking of the trap known as TARP, there’s this from the Financial Times — “Strong banks will be allowed to repay bail-out funds they received from the US government but only if such a move passes a test to determine whether it is in the national economic interest, a senior administration official has told the Financial Times.” Translation: “We’re still trying to think up ‘good’ (i.e., politically palatable) reasons not to accept repayments.”
Speaking again of the trap known as TARP, there’s this from the New York Times (”U.S. May Convert Banks’ Bailouts to Equity Share”) — “While the option appears to be a quick and easy way to avoid a confrontation with Congressional leaders wary of putting more money into the banks, some critics would consider it a back door to nationalization, since the government could become the largest shareholder in several banks.” It isn’t a “back door” to nationalization if Uncle Sam owns a majority share; it IS de facto nationalization.
Also, there’s this from the NYT — “The administration’s central revenue proposal — limiting the value of affluent Americans’ itemized deductions, including the one for charitable giving — fell flat in Congress, leaving the White House, at least for now, without $318 billion that it wants to set aside to help cover uninsured Americans.” Wait until they see now much more money they’re doing without thanks to administration’s determination to show us how supply-side econ works in reverse.
Even more refutation of globaloney (HT Benny Peiser’s daily e-mail) — “ICE is expanding in much of Antarctica, contrary to the widespread public belief that global warming is melting the continental ice cap.”
Finally, a noteworthy anniversary — Did you know that it’s been two years since Harry Reid told us that the war in Iraq was lost? We’re still waiting for the “I was wrong, I am sorry,” Harry –
The Public Pension Shakedown
http://online.wsj.com/article/SB124018479323033267.html#mod=djemEditorialPage
New York Attorney General Andrew Cuomo and the Securities and Exchange Commission allege that investment firms paid politically connected “placement agents” in return for a piece of New York’s $122 billion pension fund. The AG has indicted three politicos for kickbacks, but the media have focused on the private firms that hired some of these political agents. Thus the attention on Mr. Rattner, who as co-founder of the Quadrangle investment firm met with a consultant about paying a finder’s fee for pension cash.
The motive and knowledge of these private investors need to be explored, but the main culprits are the public officials and their agents. Former New York Comptroller Alan Hevesi resigned in 2006 after pleading guilty to unrelated charges of defrauding the government. But his office served as exclusive manager for the pension fund that is one of the world’s biggest institutional investors. What the New York scam is laying bare is the extent to which officials allegedly leveraged those taxpayer dollars to enrich themselves and increase their political power.
For the record, it isn’t illegal for investment firms to hire “placement agents.” Hedge funds and private equity firms have long outsourced their marketing to companies whose job it is to reach out to potential investors and arrange roadshows. These placement agents are typically paid a percentage of the money raised.
Now imagine this on a vast scale with Social Security, using it’s funds to garner votes in an insidious bribe of various groups to form a majority voting block.
Comment by dscott — April 20, 2009 @ 10:59 am
Lighthouse Harry should probably then declare that Liberalism has won total power in America. In two years, he might see what an election defeat really looks like.
Comment by MAS1916 — April 20, 2009 @ 11:55 am
talking about TARP and the supposed plan of getting banks to lend again, Houston, there is a problem…
WSJ article, Bank Lending Keeps Dropping:
Lending at the biggest U.S. banks has fallen more sharply than realized, despite government efforts to pump billions of dollars into the financial sector.
According to a Wall Street Journal analysis of Treasury Department data, the biggest recipients of taxpayer aid made or refinanced 23% less in new loans in February, the latest available data, than in October, the month the Treasury kicked off the Troubled Asset Relief Program.
The total dollar amount of new loans declined in three of the four months the government has reported this data. All but three of the 19 largest TARP recipients with comparable …
http://online.wsj.com/article/SB124019360346233883.html
If you don’t have the WSJ subscription use this link: http://www.news-to-use.com/2009/04/bank-lending-keeps-dropping.html
Interesting comments at the NRO regarding this WSJ article:
The Wall Street Journal reports today that the TARP money appears to be for bank bondholders rather than bank lending
http://corner.nationalreview.com/post/?q=ZDhmNDY4NmU0MzE5M2M1NTZjOTRjZjYzNjVmMTlhYWM=
Would that bond holder be China of US bonds? I saw an interesting take on what prompted the Fed take over of Fannie and Freddie, namely China another nations hold a lot of those bonds. http://www.moneymorning.com/2008/09/11/fnm/
Personally back to the reason IMO why the banks are lending as much is due to a lack of qualified borrowers OR they aren’t doing mortgage lending due to the CRA. If they are legally required to make an unsound loan, it is better not to loan any money at all in the home mortgage business.
Banks defend their lending, saying they’re eager to issue new loans, refinance existing ones and modify those in danger of default. Complicating their efforts, bank executives say, is a decline in demand among consumers and businesses.
The lending data indicate that consumer loans, especially mortgage refinancings, are accounting for an increasing portion of bank lending. In February, nearly half of lending by the 21 banks was to consumers, up from about one-quarter in October. But excluding mortgage refinancings, consumer lending dropped by about one-third between October and February. Commercial lending slumped by about 40% over that period, the data indicates.
One factor that may have depressed commercial borrowing is a partial thawing of bond markets, where some big companies raise money instead of borrowing it from banks. About $70 billion of corporate bonds were issued in February, up from $21.4 billion in October, but still only about half the level of last May, according to Thomson Reuters.
Without an actual break down of new mortgage, refi and consumer credit, it’s anyone’s guess as to what’s really happening.
Comment by dscott — April 20, 2009 @ 1:48 pm
And now for that moment you all have been dreading, the test results: Stress Test Leak #1 http://www.news-to-use.com/2009/04/stress-tests-leak-no-1.html
Comment by dscott — April 20, 2009 @ 1:56 pm
#2, we should be so lucky.
#4, appears to be a shaky source, and it’s being denied. Then again, so was the National Enquirer as John Edwards engaged in denial.
Comment by TBlumer — April 20, 2009 @ 2:21 pm