Fannie Mae

It's DeFault of The Rich

The kings and queens of the real world monopoly (and 10 digit welfare checks) are walking away from their million dollar homes now. Via Balloon Juice:

I can’t wait to hear how Republicans try to pin this shit on black people and Fannie Mae and Barney Frank.

A little bit from the article - "Biggest Defaulters on Mortgages Are the Rich" - below the fold.

False Sense of Security From Masters of Econ Disasters And The Markets Empty Threats

It is becoming pretty darn clear that the fools that created the economic disaster think they can push us through it on their wishful thinking. Idiots like Geithner are painting rosy pictures of what they are doing - with Obama noddingly approving of it - and hoping you, the average American and the ones that are still being crushed economically, won't notice. Yves there:

Geithner Yet Again Misrepresents TARP “Performance”

Meanwhile and according to Paul Krugman,

Against The Super-Asinine, The Gods Themselves Contend in Vain


Brad DeLong wonders how the proponents of tight budgets and tight money are prevailing in the midst of mass unemployment, low interest rates, and incipient deflation.

It’s actually not all that surprising. Horrifying, but not surprising.

The case for expansionary policies in the face of a slump is intellectually difficult; Keynes described the writing of the General Theory as a painful process of discovery, and so it is. The natural instinct of almost everyone is to think that tough times require tough measures, and that if the economy is suffering, the government should tighten its own belt. It would take a clear consensus from economists to overcome that natural bias.

And that consensus has, of course, been lacking — largely because a significant proportion of the economics profession has spent the last three decades systematically destroying the hard-won knowledge of macroeconomics. It’s truly a new Dark Age, in which famous professors are reinventing errors refuted 70 years ago, and calling them insights.

While we bear in mind that there may be real solutions that will stop this disaster from happening again, and the need to really address the results of it honestly, there are the underlying rules of a market whose obscene motto for years was:

Now We Know What AIG says, We Still Need To Know The Answer "What The Hell Is the Real Story?"

So, now we know, two thirds of the bail out money which went to AIG between October and the end of December wasn’t intended for AIG at all, but was passed through to others. The list includes Goldman Sachs, Morgan Stanley, Deutsche Bank, Societé Generale, and many others. And, if that wasn’t enough to make you choke on your coffee this morning, there’s the additional fuel of the AIG bonus story. OMG, this is just like totally over the top.

 
There’s a lot of outrage about this which is kind of being stoked by the media, and there’s some useful commentaries which are dealing with parts of the story. These three from Robert Kuttner Robert Reich and the America’s Future blog are ones to take cognizance of, I think. In Kuttner's view Obama's financial team is leading him to destruction. Reich raises his voice against the corruption, and so do the folks over at Progressive Breakfast in their morning release.
 
The outrage is directed at the upfront particulars, the bonuses and the pass-through laundering of bail-out funds. I think though there is a picture beginning to emerge of the structure of the Paulson-Bernanke bailout which raises a whole range of other issues. The banks continue to insist that their assets will come good with a rebound in the economy, and therefore their current pricing structure should be preserved.Yves Smith provided a major service this morning over at Naked Capitalism when she made available Bruce Krasting's discussion of the AIG bonusses and Tyler Durden's guest post on bailout spotting.

Any oversight by Office of Federal Housing Enterprise Oversight - www.ofheo.gov?

Bumped. -- GH Originally posted 2008-09-07 13:11:07 -0500.

Now that taxpayers are about to pick up the tab on another megabillion dollar problem of the Bush Administration, I have some questions. Note: this commentary began its life just moments ago as a comment on Taxpayers picking up the tab again

--- Ever since I've known of this office, I've wondered if they have actually done any oversight of Fannie Mae and Freddie Mac.

What do they do? And how'd Mike Connell get the job of running their website back in 1999? Does George W. Bush get some sort of inside information from this arrangement?

Bush Press Conference to address Concerns about the Economy - Updated

Actually, from the quick little blurb from the WSJ this morning, it sounds more like President Bush will use the opportunity of terrified markets to push for ...

more oil drilling.

The press conference will start at 10:20 a.m. Mr. Bush is expected to press Democrats in Congress hard on the need for more oil exploration, particularly in the Outer Continental Shelf. He's also likely to criticize Congress for failing to move on most annual spending bills.

Stay tuned. (and more updates below the fold)