Tag Archives: Bailout

Two For One

I posted on an earlier story about media bias.  However the main point of the story was missed in the bias stuff; the fact that the US government lost $1.3 billion.

THAT is a lot of money.



Never to be seen again.

But the government bailing out the auto industry was a good idea, right?

Obama Wants To Sell GM

If you needed further proof that the whole GM bailout thing was anything but political, you can check out the most recent news from Washington:

The U.S. government plans to sell a significant share of its remaining stake in General Motors Co. this summer…

On one hand, that’s great news.  The less productive assets we have in the hands of the government, the better off those productive assets are.

On the other hand, it’s kind’of a bummer.

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Wherever the oil went, the damage done to the area is horrific.

Industries are impacted.

Families are impacted:

LAKESHORE, Miss. – Pete Yarborough, a trucker who hauled seafood until the BP oil spill hit, and about 800 other households are under pressure to buy or get out of the state-owned cottages they’ve been living in…

I can’t imagine.

If I’m in a position where I’m in government housing  the last thing I wanna hear is that my only means of making a living is ending.  AND I’m facing a deadline.

But there’s more than meets the eye.

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Good Work If Ya Can Get It

Wanna know why California is going down the toilet?  And perhaps, why the rest of us are soon to follow?  Because unlike the real world, California rewards organizations that fail.

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Ford vs. Chevy

Finally!  I can go back to rooting for my old favorite.  GM was able to pay back their loan from Uncle Sam nearly 5 years early.

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Fannie and Freddie Done

Thank gawd!  To finally see the two agencies almost single-handedly responsible for the financial crisis of the last 2 years on the ropes almost makes up for last night’s horror show.  Almost.

“It’s clear that Fannie and Freddie, as they currently exist, should be put out of existence, which means the important question is what combination of entities public and private will replace them,” said Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee.

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How Cities Benefit by Labor Unions

How does a public pension fund respond after losing more than $70 billion of its $260 billion fund?

“It is important for you to know that the current credit crisis does not directly affect your retirement benefits, which are securely protected by law, or our ability to pay benefits.”

Translation: Not to worry; the taxpayers will have to bail us out.


And what does it mean to tax payers when said fund loses more than $70 billion of its $260 billion fund?

In the end, taxpayers stand to pay plenty for all this, either through increased taxes or diminished public services — closed libraries and shelters for battered women, fewer trash pickups, shuttered courts, slower police and fire response times, more potholes, early county jail prisoner releases and much more — if local governments see layoffs and furloughs as their only way out.

This is your bed, California.  I really REALLY hope that only YOU have to lie in it.

More of the Same

Wanna know why we are in the trouble we’re in right now?  People spent too much money.  Many times, money they didn’t even have.  They either bought a house they had no business buying or they refinanced that house and spent the money somewhere else.

Either way, we simply spent too much money.

And the only way that we are going to be able to get better is to let this thing play out.  The over spending, and the bubble that it created,  has GOT to play out, and get out, of the system.  Pure and simple.

Which makes me shake my head when I read this:

Under the program, eligible borrowers who are behind or at risk of default can have their mortgage interest rate reduced to as low as 2 percent for five years. They are given temporary modifications, which are supposed to become permanent after borrowers make three payments on time and complete necessary paperwork, including proof of income and a hardship letter.

See, the Government has set up a program that allows folks who are in trouble with their mortgage to get help.  Ignore, for a second if you can, the fact that the government has no business stepping and helping these people.  Focus instead on if the program works or not:

Only one in three homeowners who have signed up for the Obama administration’s mortgage relief plan have sent back the necessary paperwork, highlighting continuing problems for the government’s effort to stem the foreclosure crisis.

It doesn’t.  And how could it?

Lenders, however, say the majority of borrowers either don’t complete the paperwork or don’t make the payments. At Bank of America, for example, only a quarter of the 65,000 borrowers in trial modifications have sent back their paperwork.

The bank blamed “ineffective communications with customers, shortcomings in document maintenance, misunderstandings about program requirements, and the inability to comply by some borrowers,” according to written remarks from Jack Schakett, Bank of America’s credit loss mitigation strategies executive.

I mean seriously.  Can you imagine going to the DMV for help on your mortgage?  Can you imagine the confusion that must reign at these offices?

Government.  Sheesh

You Have to Try to be This Dumb

Or, maybe, you just have to have never done it.  Check out this bit of information describing the Obama Administration:

Hat Tip The Enterprise Blog via Carpe Diem

Rookie QB, RB and WR. Wonder why we have zero points?

We are witnessing a deadly combination; A powerful government expansion into the private sector coupled with an administration that has not one single clue how to run an organization within that private sector.  The Entrepreneur in Chief himself has never held a single position that required him to run an organization of people, accomplish a goal and do it well or be fired.  Shift managers at McDonald’s have more experience running a shop than this guy.

And so it is that while I shake my head in wonder, I find myself understanding how this can continue to continue:

WASHINGTON – The Obama administration, battling a foreclosure crisis that shows no signs of relenting, will step up pressure on mortgage companies to do more to help people remain in their homes, officials said Saturday.

… the goal was to increase the rate that troubled home loans were converted into new loans with lower monthly payments.

Industry officials said the new effort would include increased pressure on mortgage companies to accelerate loan modifications by highlighting firms that are lagging in that area.

So, to be clear, the government “stepped up pressure” on firms to borrow people money so that they could get into a home.  Then, when those people who couldn’t afford to buy a home actually start to demonstrate that they can’t afford to own a home, the government is going to “step up pressure” on those companies to help those people who can’t afford to be in a home stay in the home that they can’t afford to be in.


And why are we going to do this?

Rising foreclosures depress home prices and threaten the sustainability of the fledgling economic recovery.

Ahhh, yes.  Of course.  And so, in an effort to help fix the problem, ol’ Unc Sam is gonna step in and hold those home prices artificially high.  See, right now, there are a number of people holding onto assets [homes] at a price that isn’t sustainable.  Given their marginal risk and marginal gain, they are determining that keeping the house is not an option.  If left to normal devices, the house would foreclose and the surrounding properties would adjust their value; almost assuredly downward.  This in turn sends a signal to home BUILDERS that new homes are not needed and therefore they won’t be built.  In time, the value of existing homes will find a level at a sustainable price and people will again begin to buy homes.

But no.  Obama wants tp keep prices artificially high.  This in turns keep people in their homes sending signals to builders that we need more homes.  Further, because these value stay high a whole segment of the population is not able to realize THEIR dream of buying a home; they are priced out.  In any event, the bubble that was is now becoming the bubble that continues to be.

The best part?

Under the $75 billion Treasury program, companies that agree to lower payments for troubled borrowers collect $1,000 initially from the government for each loan, followed by $1,000 annually for up to three years.

We get to spend a TON of money that we don’t have on a government program that is going to beg, BEG, for fraud and abuse.

At this rate; Sarah Palin, heck, anyone, will be able to beat Obama in 20112.

This Isn't Going To End Well

We know what happens when the government pressures banks to lend to people they wouldn’t otherwise lend to, right?

So, what does Obama wanna do when banks won’t lend to people they don’t want to?  He pressures ’em.

President Obama is prepared to take “every appropriate step” to pressure banks to lend more money to small businesses, he said Saturday, the latest in a week of salvos his administration has directed toward financial institutions.

Obama said banks should return the favor for a $700 billion taxpayer-financed financial bailout package by lending more money to small businesses, without specifying what steps he would be willing to take to mount pressure on the banks.

Too many small business owners remain unable to get credit, Obama said in his weekly radio address, despite his administration’s efforts to jump-start lending, which was virtually frozen when the financial crisis took hold last year.

“These are the very taxpayers who stood by America’s banks in a crisis, and now it’s time for our banks to stand by creditworthy small businesses and make the loans they need to open their doors, grow their operations and create new jobs,” Obama said.

“It’s time for those banks to fulfill their responsibility to help ensure a wider recovery, a more secure system and more broadly shared prosperity,” said Obama.

Because 9.8% unemployment just isn’t high enough.  You know what happens when you start a Rookie?  He gets beat.