Comments on: “IT’S EASY TO FIND FAULT…especially if you’re clueless!!

By: mary

mary — Mon, 19 Jan 2009 22:00:03 +0000

Thanks, Larry for an insightful article here. But I’m wondering about bank interest rates and future mortgage rates. Would Obama address the supply or demand side, or is he totally clueless….

By: Who Did They Think They Were Kidding? : NO QUARTER

Who Did They Think They Were Kidding? : NO QUARTER — Mon, 19 Jan 2009 00:08:09 +0000

[...] “IT’S EASY TO FIND FAULT…especially if you’re clueless!! (December 11, 2008) It keeps getting back, though, to the fact that the current situation as well as our future situation under any reasonable economic scenarios highlight the fact that the Wall St. banks are sitting on enormous embedded losses and expected future losses (continued increasing defaults on residential mortgages, credit cards, commercial loans, corporate loans). The money is not flowing through because: banks need to replenish capital against these losses. [...]

By: LD

LD — Fri, 12 Dec 2008 00:34:55 +0000

Linda…We,as in all of us, own 79.9% of AIG. The “systemic” risk if the government simply let them fail would be a massive selloff in both equity and bond markets. For that reason and others I remain decidedly cautious on the markets overall. AIG is trying to buy time and sell assets to pay off the U.S> loan. The markets know this and thus the sectors /assets that AIG would like to ssell remain “well offerred” and will continue to remain well offerred. In fact, the pressure of this AIG situation is pressuring the businesses and valuations for other insurance companies.

In regard to lehman, the government could not save them because there were no other banks or companies that wanted to take them over. It was only a matter of time before they were going down .

By: LD

LD — Fri, 12 Dec 2008 00:17:00 +0000

Choo Choo…thanks for the plug. Again, I think the powers that be are concerned about spooking the markets if they lay out more details about just how widespread the losses and problems are. That said, Treasury and Fed are flying all over the place and thus displaying uncertainty which the markets NEVER like.

By: Choo Choo Magoo

Choo Choo Magoo — Thu, 11 Dec 2008 23:45:05 +0000

Thanks for another great article LD. Enjoyed how you lay bare the problem in straightforward, fundemental way. Particularly enjoyed your wack-a-mole analogy on a previous post. The powers that be can not seriously be so lacking in intellegence that they actually think these piece meal money plays will resolve, let alone solve such massive intertwined problems. So one must assume it is willful ignorance once again in play. (Willful ignorance being what got us in such a mess in the first place) And they want us all to play make believe along with them. And if we close our eyes and click our heels and wish very very hard, we will all be back in Kansas and all will be right with our world.

By: Linda C.

Linda C. — Thu, 11 Dec 2008 22:42:13 +0000

Why are we propping up AIG again? Another 10 billion down some rabbit hole. Has anyone keeping tract of the total? I think half of the TARP money spent has gone to AIG if my memory of the figures are right.

Why did we let Leehman Bros fail? Didn’t it have to do with there was no hope in saving them no matter how much money we threw at them?

By: lark

lark — Thu, 11 Dec 2008 21:10:34 +0000

They did because there was no point for the suit. Donofrio has had no damages and there is no point on wasting time for nothing.

Once BO becomes President then (as I understand) if he damages anyone he will have to pay, unless he can prove he is constitutionally eligible for his office.

If he isn’t then he may exercise his options. Continue to exercise the office and be financially responsible for damages or resign.

By: LD

LD — Thu, 11 Dec 2008 19:20:44 +0000

Thanks for the plug.

By: WildChild

WildChild — Thu, 11 Dec 2008 19:09:30 +0000

we figured they would. LOL they haven’t been very strict constructionist when it comes to presidential elections.

By: bob

bob — Thu, 11 Dec 2008 19:06:10 +0000

The Supreme Court has turned down an emergency appeal from a New Jersey man who contended President-elect Barack Obama was ineligible to be president because he was a British subject at birth. The court did not comment on its order Monday rejecting the call by Leo Donofrio of East Brunswick to intervene in the presidential election. Donofrio said that since Obama had dual nationality at birth —- his mother was American and his Kenyan father at the time was a British subject —- he could not possibly be a “natural born citizen,” one of the requirements the Constitution lists for eligibility to be president.

By: getfitnow

getfitnow — Thu, 11 Dec 2008 19:05:54 +0000

Thanks LD

By: DAB

DAB — Thu, 11 Dec 2008 18:48:40 +0000

I agree with LD that to expect immediate results from TARP is naive. We really should have an election system that outlines exactly what the qualifications/job description of a Congressperson should be and have them fill out a questionnaire as any potential employee should.

I saw a bit of the Congressinal hearings and they are indeed a colossal waste of time, with everyone grandstanding for the folks back home.

Thanks LD for your detailed analysis of what is going on financially and adding some clarity to this mess, since confusion seems to be reigning right now.

By: fiscalliberal

fiscalliberal — Thu, 11 Dec 2008 18:47:41 +0000

Gee – how about the curtesy of staying on topic.

Just a comment about “Neel Kashkari” in the TARP hearings. My intitial reaction to him is one of distrust or incompetence. His tone of voice is condesending and often talks about “I hear you and we are working on it”. When I was working as an engineer, I reported to bosses and finance people. I never could answer with that level of crap.

As a minimum I had to talk about status, progress and expected results. No wonder a lot of the Congresspesons were realy ticked at him. In fact Paulson should be there answering the questions. Shame on the Democratic Leadership for not demanding Paulson.

LD – I think the level of frustration is from the bait and switch. Also hearing from constituents who are trying to get loans. Olso the “no doc” real estate loans really tick a lot of people off.

Rule number one in something like this is to manage expectations. However, Paulon bait and switching with no explanation raises the level of distrust. Then GAO comes out with a report saying they are not traking the money. It would appear the whole concept of metrics is no something Paulson was planning on addressing.

By: lark

lark — Thu, 11 Dec 2008 18:24:14 +0000

That means that you believe he was born in Kenya. No? Otherwise why post the INA code. So if you believe he was born in Kenya why not ask of Obama to show papers since his only witness now alive was his Kenyan grandmother. She said he was born in Kenya. Documents are unnecessary according to you.

So if his mother was a U.S. citizen in Kenya and the INA code says ‘certain residency or physical presence requirements’ then anyone could sue him after he becomes President if he causes them damages to find out if those ‘certain residency and physical presence requirements’ were present at the time of his birth. Or are you going to deny the due process of the courts to us Americans? No of course you wouldn’t.

Let him take the office as a personal liability act and then sue him for damages if he happens to cause damages. His only scape would be to show he is a ‘natural born’ citizen, thus qualified.

By: bob

bob — Thu, 11 Dec 2008 18:02:34 +0000

No, the reason is: the Constitution doesn’t say what documents prove citizenship.

Section 301 of the INA [8 USC § 1401] defines the following classes of people as having US citizenship from the time of birth:

anyone born in the US and subject to its jurisdiction (basically meaning anyone other than a child of foreign government representatives with diplomatic immunity);

Indians and other aboriginal people born in the US;

anyone born outside the US, if at least one parent is a US citizen and certain residency or physical presence requirements were fulfilled by the citizen parent or parents prior to the child’s birth;