Tuesday, September 23, 2008

It's Criminal What's Going On

...on Wall Street. Just criminal.

Even the FBI agrees.
The FBI is investigating Fannie Mae, Freddie Mac, Lehman Brothers and AIG - and their executives - as part of a broad look into possible mortgage fraud, sources with knowledge of the investigation told CNN Tuesday.

The sources would not speak on the record because the investigation is ongoing.

FBI spokesman Special Agent Richard Kelko had no comment on that information, but said that 26 firms were currently under investigation as part of the bureau's mortgage fraud inquiry.

Earlier this month, FBI director Robert Mueller told Congress that 1,400 individual real estate lenders, brokers and appraisers were now under investigation in addition to two dozen corporations.

"The FBI currently has 26 pending corporate fraud investigations involving subprime lenders," Kelko said. "As we have seen, this number can fluctuate over time, however we do not discuss which companies may or may not be the subject of an investigation."

Heads will roll here, folks. Civil servants have mortgages too.

You Know The UberBailout Fix Is In

...when you see headlines like "Senate attack on bailout lacks explicit threat".
Many members of the Senate blasted the Bush administration's Wall Street bailout plan on Tuesday, but no senator has come forward so far with an explicit pledge to kill the $700 billion proposal.

The rules of the Senate, unlike the House of Representatives, give individual lawmakers substantial power to delay or halt legislation, but three Senate aides said there were no clear signs yet of that power being exercised.

And that's the ballgame, folks. The Plan is go, the Dems will get the crap kicked out of them as this becomes the Bush-Pelosi-Obama Socialism On Wall Street Act, and President McSame continues us on the path to hell.

I expect something to be on Preznitman's desk by this weekend.


[UPDATE] The Bush-Cheney-Pelosi-Reid-Obama Bailout Bill continues to take shape.

There was a time when Dick Cheney could turn back a Republican revolt on Capitol Hill.

That time is gone.

House Republicans rose up en masse against their vice president on Tuesday morning to blast an administration proposal that would grant Treasury historic authority to start buying hundreds of billions of dollars in devalued mortgage-related assets, according to members present.

The lines to speak were long, the questions many and sentiment in the Cannon Caucus Room Tuesday swayed heavily against the Treasury proposal.

Afterward, Texas Rep. Joe Barton took the unusual step of telling reporters that he had politely given Cheney a piece of his mind – the sort of dissent Republicans considered unthinkable during much of the Bush administration's reign.

A full-throated Republican revolt could create huge problems for the administration and congressional Democrats scrambling to assemble a package to reassure jittery markets. It could also preserve the Republicans’ options after the fact – if the bailout doesn’t work or proves deeply unpopular with voters, they can say they opposed it.

Ahh yes, Politico.com takes note of a House GOP revolt against a bill the Democrats and the Bushies are putting together.

Take notes. We're getting our asses kicked again and we're walking right into the trap anyway.

In Which Zandar Goes Well Duh, No Shit

Digby says "Hey, there's something fishy about the timing of this Uberbailout thing."
Marci Wheeler catches an interesting little aside in today's Roll Call article about the latest White house meddling... er management, of King Henry's snow job:

Hidden in an article reporting that Cheney's going to go hunt up some support for the $700,000,000,000 bailout is this admission that the Bush Administration has been sitting on it for some time:

Fratto insisted that the plan was not slapped together and had been drawn up as a contingency over previous months and weeks by administration officials. He acknowledged lawmakers were getting only days to peruse it, but he said this should be enough. [my emphasis]

If the Bush administration has been formulating this plan for months and never breathing a word to lawmakers about it, then there is a much bigger story here than we know. This is being presented as a response to an unpredictable crisis. If that's not true then perhaps some of the conspiracy theories that are floating around are actually true.

Let's hope Fratto is blowing smoke. This bail out plan is being sold as an emergency measure requiring extraordinary powers. If they saw this coming and this is the plan they had waiting in the wings, then we are dealing with something quite different than what we are being told.
You mean the Bushies just happen to have a convenient plan on hand after ignoring the warning signs all over the situation that led to this crisis, that gives them a shitload of money and even more power to the Executive, and takes power away from the Legislative and Judicial branches by declaring checks and balances to be dead in a time of extrodinary and totally unforseen chaos?

Well I'm shocked, it's not like we have ample precedent for that sort of completely cynical and disgusting reponse from these assclowns over the last eight years or anything.

No sirree.

More Sand For The Sandbag Job

Helicopter Ben is certainly doing his bestest job in order to get the Democrats to PASS THE UBERBAILOUT NOW OR WE'LL ALL BE LIVING IN CARDBOARD BOXES!!!one!1!!
Federal Reserve Chairman Ben Bernanke told the U.S. Congress Tuesday that financial markets are under severe stress and urged immediate action to buy up hundreds of billions of dollars worth of tainted mortgage assets.

"Despite the efforts of the Federal Reserve, the Treasury, and other agencies, global financial markets remain under extraordinary stress," Bernanke said in remarks prepared for delivery to the Senate Banking Committee that were obtained by Reuters.

"Action by Congress is urgently required to stabilize the situation and avert what could otherwise be very serious consequences for our financial markets and our economy," he said.

Remember the GOP Plan, class:

  1. Make the Democrats PASS THIS NOW OR WE'RE DOOMED!
  2. Vote against Uberbailout and blame Obama, Nancy, Harry and Bush.
  3. Win back House, Senate, and take White House in faux populist uprising/demotivated Dem base collapse.
  4. Continue to urinate on Constitution and American taxpayer and get filthy rich while doing it.
Why does Ben Bernanke have a job again? I'm just curious.

[UPDATE] And David Brooks explains everything with his Village Idiocy Beam.
The Paulson rescue plan is one chapter. But there will be others. Over the next few years, the U.S. will have to climb out from under mountainous piles of debt. Many predict a long, gray recession. The country will not turn to free-market supply-siders. Nor will it turn to left-wing populists. It will turn to the safe heads from the investment banks. For Republicans, people like Paulson. For Democrats, the guiding lights will be those establishment figures who advised Barack Obama last week — including Volcker, Robert Rubin and Warren Buffett.

These time-tested advisers, or more precisely, their acolytes, are going to make the health and survival of the financial markets their first order of business, because without that stability, the entire economy will be in danger. Beyond that, they will embrace a certain sort of governing approach.

The government will be much more active in economic management (pleasing a certain sort of establishment Democrat). Government activism will provide support to corporations, banks and business and will be used to shore up the stable conditions they need to thrive (pleasing a certain sort of establishment Republican). Tax revenues from business activities will pay for progressive but business-friendly causes — investments in green technology, health care reform, infrastructure spending, education reform and scientific research.

If you wanted to devise a name for this approach, you might pick the phrase economist Arnold Kling has used: Progressive Corporatism. We’re not entering a phase in which government stands back and lets the chips fall. We’re not entering an era when the government pounds the powerful on behalf of the people. We’re entering an era of the educated establishment, in which government acts to create a stable — and often oligarchic — framework for capitalist endeavor.

After a liberal era and then a conservative era, we’re getting a glimpse of what comes next.

Yes, just what we need, more elite Smart Wall Street Guys running the country, unlike the last 30 years. Meet the new boss, same as the old boss.

Ultimate Sandbag Job

A whole bunch of the lefty blogosphere is convinced that the Great GOP Election Plan here is to sucker enough Democrats into passing the UberBailout so that as many Republicans as possible will then have political cover to vote no, and then Republican challengers to the Democrats who voted for the bailout can spend the last month of the campaign running "My opponent voted to give $700 billion of your money away to Wall Street. Fire their ass. Vote GOP, the party of change."

I absolutely agree with this. McSame will be leading the charge on this issue. I can guarantee you that he will vote no on the UberBailout, 100% guarantee as sure as the sun comes up. No question.

And if Obama either skips the vote or votes yes, he loses the election...because frankly if Obama DOES vote yes on this, he'll lose my vote and millions of others as well and deservedly so.

The trick is not to fall into the trap on the first place. Everything is political to the GOP. They do not give a good goddamn about saving the American taxpayer. They DO care about taking the House and Senate back under McSame/Palin and locking this country down under a police state they can use to foment endless conflict in the Great Resource Wars while making the top 1% even richer.

The solution is simple: vote no on Uberbailout. Craft a real solution. The GOP wants the "Bush-Pelosi-Obama Bailout Bill" and they are confident they'll get it.

[UPDATE] Amanda Marcotte weighs in with a pretty damn good piece, offering this advice.
Someone needs to tack a sign in every Democrat’s seat in Congress that says, “Act in haste, repent at leisure”.

I will say that one thing Republicans are definitely good at is politics. I agree with Atrios that the plan is to guilt Democrats into passing this piece of shit and then Republican challengers, including McCain, will run against them saying that they are the guilty parties. But on the other hand, if Democrats stall this, then Republicans will blame them. Either way, we’re screwed, and Republicans have a story about how they’d totally be able to handle things if only the American people would let them have power, as we have for decades.

How much do I love the cojones of Henry Paulson, pouting that the Democrats might attach a populist rider that minimizes the amount of the bailout that goes straight into the pockets of executives, so they can retire as multi-millionaires? We’re so mean, we the people.

Good points all and I'll go further: As Amanda says not only will the Republicans blame the Democrats for not passing the UberBailout (and then turn around and not vote for the the damn thing when it becomes clear the Dems have been steamrolled into passing it) but that the GOP can get away with it because A) the "liberal" media's choosing to not pay attention again on this issue (the transitory nature of the GOP talking points fed to them are in flux, so they don't know how to respond other than inanities) thereby resulting in a de facto pass on the issue and B) Whichever way the GOP tacks on this issue, they will do so as a united front, something the Democrats never seem to be able to do with the Bush Dog Democrats always fucking things up for our side. The GOP has always been much, much better at taking marching orders as a voting bloc, while Nancy and Steny Hoyer always seem to be split on the issues and Harry folds all the goddamn time.

Let's remember that the first folks to propose a "FTC-type agency to buy mortgage debt" in the first place were Barney Frank and Chris Dodd back last Wednesday night and early Thursday. Once those plans got out, the GOP unloaded their financial dictatorship plan to take it to the illogical GOP extremist endpoint, but of course the Dems made the first move, and that's all it takes to be steamrolled. (how's that learning curve going, guys?)

Point is when the shit hits the fan, the GOP often sticks together, while the Dems argue among themselves and the DINOs and ultimately look like idiots. For the most part, Congress has earned that 11% approval rating on a daily basis. Only this time when it happens, we're looking at complete financial devastation AND McSame/Palin in the White House.

It would be nice if they didn't foul this up.

More Epic Campaign Manager Fail

McSame's Lobbyist In Chief/Campaign Manager Rick Davis is the gift that keeps on giving to Obama.
An emerging meme on the right, one that's being championed by the likes of Neil Cavuto and others, is that the mortgage crisis happened not because of deregulation, but because brokers were pressured into making loans to "minorities and risky folks," as Cavuto tastefully put it.

But guess who actively sought to boost minority homeownership? John McCain's campaign manager, Rick Davis.

It's bad enough that racist assholes are blaming minorities (read: black people and their black candidate Barack Obama) for the financial crisis. But they completely fail to mention that the same mortgage industry went out of its way to sell subprime loans to people who would have problems paying their mortgage if the value of their home went down...that's exactly how subprime mortgage loans were specifically designed by the industry. They were tailored to people who didn't have good enough credit to get a regular mortgage loan, and pushed by greedy mortgage brokers who got fat commissions off each loan they made.

These loans were then bundled and sold in packages along with regular loans with the specific goal of insulating the industry against the risk of people not being able to pay their subprime loans. But when the entire housing market collapsed, the insulation of good loans wasn't nearly enough because so many subprime loans were sold to people, and they all went bad at the same time.

It was Wall Street greed, plain and simple. Yes, there are people who lied about their incomes on mortgage loans. But far more unscrupulous mortgage brokers sold loans to people they knew couldn't pay if the housing market took a downturn.

And we're in the middle of a complete collapse of the housing market. The reason the damage is so great? Folks like John McSame's own campaign manager Rick Davis lobbied to strip regulation and allow the industry to make subprime loans to anybody and everybody because they wanted to help minorities prosper in Bush's "Ownership Society" when what they really wanted to do was get rich off people who could afford it the least with predatory lending practices.

"We have an opportunity in the next decade to increase minority homeownership and significantly reduce the minority homeownership gap," Davis is quoted saying here. "The future of the housing market rests heavily on the economic success of minorities. Homeownership is likely to grow faster among minority Americans in the next decade if all the stakeholders in the housing industry work together to make it happen. The Homeownership Alliance is working toward this goal."

Rick Davis is part of the problem, just like McSame and the rest of his lobbyists running to "change Washington."



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