Where is the US economy headed?

hawkeye wrote: "...now that everyone lost faith in Washington's ability to deal with the economic problems."

Who is "everyone?" Are you suggesting that everyone was able to determine the results of this stimulus plan after one week after its implementation? That's quite a skill of unmitigated proportions.

And conservatives want historians to wait for a few years before they rate president GW Bush. Obama's been in office for barely one month.

the facts get in the way of your argument...almost every plan has been changed countless times. At the moment one of the bigger problems is that AIG and the Government have agreed and publicly stated that the original plan to dismember AIG will not work. There are no buyers right now, so the plan to have them sell themselves off to repay their government loans in the next two years was a massive miscalculation. There have been nothing but miscalculations so far, it has become very clear the Washington deciders don't know what the **** they are doing, they are spending money like drunken sailors without a clue as to the tomorrows results will be.

Today there is a story going around that it has been decided that Fannie and freddie will never go back to being operated even remotely like a private company...yet again a complete change in plans.

Capitalism needs to be able to predict the future, this has become impossible as Washington takes control of huge chunks of the economy and thrashes around not knowing what to do.

Well, a few pages ago you were saying AIG was seeking a buyer....to get value for their assets....

The only thing that rings true now is "...was a massive miscalculation..."

I've said it in the past, and I'll say it now; it's wrong for the government to be bailing out an international company like AIG that has operations all over the world, and ownership by almost every one. US taxpayers should not be held hostage to paying all this mismanagement.

Washington is screwing up more things every day; I have little faith they'll be changing their ways any time soon - or ever.

What was a cash crisis has now turned into a socialism crisis; the government taking over commercial enterprise with a bulldozer.

Oooooooweeee!. Do I get a pat on the head and a lollipop?

Do you usually patronise people in that fashion whilst getting in your complacent assertion that you are the judge of what is correct and I'm to be complimented for a rare lucky shot.

You should be an infant's class teacher with gobbies of that nature?

**** off!

Now now. If you can't play nice with the other kids, they won't be your friend, Alky.

I was being perfectly honest. Your posts are typically clear as mud and usually display an abject ignorance of the subject you are discussing. However, you managed to hit the nail on the head with this one.

This is the first time in forever that you've been correct about anything, because you truly are an idiot shite on most topics. But, if you don't want to feel good about your accomplishment, I certainly won't force you to.

On the topic of the economy,

I just don't see how Obama will avoid nationalizing the banks. There does not seem to be a clear and better alternative to doing so.

Cycloptichorn

Not everyone has lost faith, but increasing numbers are, just look at the DJIA. Investors are nervous and they are not betting on Obama's change to socialistic utopia. Meanwhile, Obama says nothing, does nothing, except plan to spend even more money, which is the problem that got is in this pickle. Instead of Lord Obama promising everybody that he will take care of them, I think its time for Americans to rise up and tell the guy to get lost and go back to our roots of taking care of ourselves for a change.

I think investors are nervous, b/c it turns out our financial companies all got into big trouble, making stupid decisions on their investments, and are now all fucked quite badly.

Now, you blame that on Obama, but why? The rot in the system has to be exposed before it can be cleared away. It's obvious to many of these investors that more and more rot waits to be exposed, and none of that process is going to make anyone any money.

This is what happens when the SEC and the Exec branch who heads it decides not to do their ******* job for 8 years. This is all a consequence of Bush's decision not to regulate the credit-default swap market. And we are going to see more pain before things start to get better.

Cycloptichorn

The SEC bears some responsibility, yes, but don't continue to duck out on your beloved liberal playtoy bureaucracies, Fannie and Freddie.

okie, How many times does it have to be pounded into your head; this all happened during GWBush's watch. He was responsible for who runs the SEC and all the government departments. The outcome that is obvious to most observers is that GWBush was an incompetent leader of our country who chose people based on political affiliation and not on experience or skill.

Right, ole Shrub had 8 years to look at the intelligence on Fannie, Freddie, the investment banks, et al. But he was too busy being occupied with occupation.

I just watched the Chairman of the Fed being grilled by a Senate Committee.

He said that it wasn't nationalisation but "we are taking plenty of control."

The gist of it seemed to be that the taxpayer is getting screwed but that there is no alternative. Which, in light of government by the people of the people for the people, means that the taxpayers have screwed themselves. And the senators being approved by the taxpayers in elections must be why Mr Bernanke looked so exasperated.

He is lying awake nights busting a gut to get people out of the **** who voluntarily got into it and all they can do is whinge and carp and grandstand to their constituencies.

Fannie and Freddie have very little to do with the problem. Thanks for parroting the Republican attack line tho!

Cycloptichorn

At least the millions of Americans who don't vote have a respectable alibi.

Okie wrote:

Not everyone has lost faith, but increasing numbers are, just look at the DJIA. Investors are nervous and they are not betting on Obama's change to socialistic utopia. Meanwhile, Obama says nothing, does nothing, except plan to spend even more money, which is the problem that got is in this pickle. Instead of Lord Obama promising everybody that he will take care of them, I think its time for Americans to rise up and tell the guy to get lost and go back to our roots of taking care of ourselves for a change.
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What Cyclops does not know, since he is a left wing ideologuye and reads nothing buy socialist and Marxist crap, is that the people who are losing millions in the market( courtesy of Barack Hussein Obama) are the ones who are needed to turn the economy around. It is obvious that the money is on the sidelines. No one who has any large sums is investing. The Socialist Obama does not realize that without investment, even his vaunted Stimulus Package will do no good because that is temporary and investment IS ONGOING.

Obama is doing the same thing FDR did. The Market continues to drop--Unemployment continues to rise and the people who could invest in the economy are keeping their funds.

Okie- I don't think he will be grinning if the market continues to fall WIPING OUT 401K's left and right. In Illinois, there is already a REBUBLICAN conservative that is looking to run for governor. There are Republicans in thewings ready to contest the lying Burris' seat.; If the market doesn't begin to go up in a big way soon and if the Unemployment Statistics do not begin to go down soon, the Democrats will lose big time in the House and Senate in 2010.

The American people are impatient. They will not give Obama more than six months to turn the economy around and when the 401K's continue tanking, millions of them will rise up.

okie fails to see some obvious evidence that the banks and finance companies (including what AIG did) were the factors that brought on this financial crisis. The blame can be tied to all those salesmen and saleswomen who sold property to unqualified buyers to earn their commissions, the banks and finance companies (including Mae and Mac) who allowed this to happen, and the banks and finance companies who repackaged these mortgage instruments into investment tools to show profit (that never really existed) on their books.

It was all based on greed.

There never was any federal laws that required the sale of property to unqualified buyers.

On a personal level, would anybody here sell their home to a buyer who shows they don't have enough income to pay for it?

okie doesn't see the obvious.

Hawkeye 10--It wasn't AIG that was the proximate cause of the downturn, it was Fannie Mae, Fannie Mac, Barney Frank and Christopher Dodd. Note:


Thursday, October 09, 2008
Barney Frank and Christopher Dodd deserve blame for Fannie and Freddie
The Independent, a British newspaper, blames the Democrats for the failure of Fannie Mae and Freddie Mac:

What is the proximate cause of the collapse of confidence in the world's banks? Millions of improvident loans to American housebuyers. Which organisations were on their own responsible for guaranteeing half of this $12 trillion market? Freddie Mac and Fannie Mae, the so-called Government Sponsored Enterprises which last month were formally nationalised to prevent their immediate and catastrophic collapse. Now, who do you think were among the leading figures blocking all the earlier attempts by President Bush " and other Republicans " to bring these lending behemoths under greater regulatory control? Step forward, Barney Frank and Chris Dodd.

In September 2003 the Bush administration launched a measure to bring Fannie Mae and Freddie Mac under stricter regulatory control, after a report by outside investigators established that they were not adequately hedging against risks and that Fannie Mae in particular had scandalously mis-stated its accounts. In 2006, it was revealed that Fannie Mae had overstated its earnings " to which its senior executives' bonuses were linked " by a stunning $9.3billion. Between 1998 and 2003, Fannie Mae's executive chairman, Franklin Raines, picked up over $90m in bonuses and stock options.

Yet Barney Frank and his chums blocked all Bush's attempts to put a rein on Raines. During the House Financial Services Committee hearing following Bush's initiative, Frank declared: "The more people exaggerate a threat of safety and soundness [at Freddie Mac and Fannie Mae], the more people conjure up the possibility of serious financial losses to the Treasury which I do not see. I think we see entities that are fundamentally sound financially." His colleague on the committee, the California Democrat Maxine Walters, said: "There were nearly a dozen hearings where we were trying to fix something that wasn't broke. Mr Chairman, we do not have a crisis at Freddie Mac and particularly at Fannie Mae under the outstanding leadership of Mr Franklin Raines."

When Mr Raines himself was challenged by the Republican Christopher Shays, to the effect that his ratio of capital to assets (that is, mortgages) of 3 per cent was dangerously low, the Fannie Mae boss retorted that "our assets are so riskless, we could have a capital ratio of under 2 per cent".

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If I understand it correctly, Raines belonged to the same college fraternity as Barack Obama. No wonder he is not being prosecuted!

It should be obvious that organizations that had their grubby hands into a large portion of the trillions in property loans, when they abandoned sound lending principles in favor of politically correct thinking and social engineering, it is going to influence the entire market and property lending industry.

ooh, right. Fannie and Freddie made all those financial institutions make stupid choices! The forced AIG to commit massive fraud! They forced banks to give loans to people without checking their credit or employment history!

Wait a minute.

Actually, they did none of those things, and you're just full of **** on this issue. Like Fox in the other thread, you haven't done much research into the actual situation, but you sure are great at blaming the people you are told to blame.

Cycloptichorn

Thursday, October 09, 2008
Barney Frank and Christopher Dodd deserve blame for Fannie and Freddie
The Independent, a British newspaper, blames the Democrats for the failure of Fannie Mae and Freddie Mac:

What is the proximate cause of the collapse of confidence in the world's banks? Millions of improvident loans to American housebuyers. Which organisations were on their own responsible for guaranteeing half of this $12 trillion market? Freddie Mac and Fannie Mae, the so-called Government Sponsored Enterprises which last month were formally nationalised to prevent their immediate and catastrophic collapse. Now, who do you think were among the leading figures blocking all the earlier attempts by President Bush " and other Republicans " to bring these lending behemoths under greater regulatory control? Step forward, Barney Frank and Chris Dodd.

In September 2003 the Bush administration launched a measure to bring Fannie Mae and Freddie Mac under stricter regulatory control, after a report by outside investigators established that they were not adequately hedging against risks and that Fannie Mae in particular had scandalously mis-stated its accounts. In 2006, it was revealed that Fannie Mae had overstated its earnings " to which its senior executives' bonuses were linked " by a stunning $9.3billion. Between 1998 and 2003, Fannie Mae's executive chairman, Franklin Raines, picked up over $90m in bonuses and stock options.

Yet Barney Frank and his chums blocked all Bush's attempts to put a rein on Raines. During the House Financial Services Committee hearing following Bush's initiative, Frank declared: "The more people exaggerate a threat of safety and soundness [at Freddie Mac and Fannie Mae], the more people conjure up the possibility of serious financial losses to the Treasury which I do not see. I think we see entities that are fundamentally sound financially." His colleague on the committee, the California Democrat Maxine Walters, said: "There were nearly a dozen hearings where we were trying to fix something that wasn't broke. Mr Chairman, we do not have a crisis at Freddie Mac and particularly at Fannie Mae under the outstanding leadership of Mr Franklin Raines."

When Mr Raines himself was challenged by the Republican Christopher Shays, to the effect that his ratio of capital to assets (that is, mortgages) of 3 per cent was dangerously low, the Fannie Mae boss retorted that "our assets are so riskless, we could have a capital ratio of under 2 per cent".

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If I understand it correctly, Raines belonged to the same college fraternity as Barack Obama. No wonder he is not being prosecuted!