Tuesday, February 17, 2009

Under New Management

Amazing how that shiny new administration smell motivates some people to actually do their jobs.
Stopping what it called a “massive ongoing fraud,” the Securities and Exchange Commission on Tuesday accused Robert Allen Stanford, the chief of the Stanford Financial Group, of fraud in the sale of about $8 billion of high-yielding certificates of deposit held in the firm’s bank in Antigua. Also named in the suit were two other executives and some affiliates of the financial group.

In the complaint, filed in Federal District Court in Dallas, the S.E.C. accused Mr. Stanford and two associates — James M. Davis, a director and chief financial officer of Stanford Group and the Antigua-based bank affiliate, and Laura Pendergest-Holt, the chief investment officer of both organizations — with misrepresenting the safety and liquidity of the uninsured CDs.
So many billions in fraud suddenly coming to light after all these years. It's almost like the previous guys were letting these dudes get away with it.

The End Of American Consumerism

Over at Yahoo Tech-Ticker, retail industry analyst Howard Davidowitz sees a permanent change in the American lifestyle coming as a result of the economic crisis.
There's no question the American consumer is hurting in the face of a burst housing bubble, financial market meltdown and rising unemployment.

But "the worst is yet to come," according to Howard Davidowitz, chairman of Davidowitz & Associates, who believes American's standard of living is undergoing a "permanent change" - and not for the better as a result of:

  • An $8 trillion negative wealth effect from declining home values.
  • A $10 trillion negative wealth effect from weakened capital markets.
  • A $14 trillion consumer debt load amid "exploding unemployment", leading to "exploding bankruptcies."

"The average American used to be able to borrow to buy a home, send their kids to a good school [and] buy a car," Davidowitz says. "A lot of that is gone."

Watch the whole interview, it's about six minutes and it'll scare the crap out of you. Davidowitz sees the American people going back to the early Reagan era of saving 8-9% of income just to survive. He sees massive unemployment from a decimated retail sector where stores like Wal-Mart are king, and specialty and high-end stores are gone almost completely.

Most of all, that crushing negative wealth effect we're looking at...$32 trillion in lost wealth gone for good...will lead to a permanent change in American lifestyle, where Americans have far less stuff, live within their means, save for a rainy day, and have a far lower standard of living. The days of a new car for a sweet sixteen present, six-figure yearly college tuition and million dollar McMansions in the exurbs are dead and gone, folks.

The world's going to be a very different place in just a short amount of time. A great many of us are not going to like the adjustment.

Stupidity At Its Finest

Michelle Malkin has problems with math.
On Nov. 4, after Barack Obama clinched the White House, the market closed at 9,625.28.

In mid-morning trading today, the day President Obama signs his massive Generational Theft Act into law and a day before he unveils a massive new mortgage entitlement, the Dow dropped to to 7,606.53.

Now, imagine if President Bush had presided over a 2,000-point stock market tumble in the same time period — during the first few months of his presidency.

Of course, when Barack Obama actually took office, the Dow was at 7,949, meaning that the last eighteen months of Bush's presidency were by comparison, with its six thousand point loss, really hideous in Michelle's book.

I wonder why she hates Dubya so much.

In Which Zandar Answers Your Burning Questions

Digby asks:
Am I the only one who finds it interesting that partisanship is back in fashion now that the Republicans are acting like political kamikazees?
No. Whatever the GOP wants, the Village backs it up. Before the stimulus the GOP wanted Obama to bow down to them at the altar of bipartisanship. Now the GOP has declared war, so partisan assaults are the new Village rage. The only mention of bipartisanship is how Obama destroyed it with his unfortunate partisan attitudes...which means the GOP has no choice but to fight back.

Retest And Re-Fail

The 8,000 mark on the Dow was retested and survived Friday's intraday drop, the news that Obama will help to prevent foreclosures erased a 200+ point loss.

That loss apparently has simply shifted to today, as the Dow is hovering around 7,600.

No We Cantor!

Fresh off their stunning ignominy involving the stimulus bill, the House No-Publicans are revving up their latest "Whatever Obama thinks is a good idea, we automatically hate it" attack, this time on the President's mortgage relief plan.
House Minority Whip Eric Cantor (R-Va.) said that the Obama administration's yet-to-be-announced $50 billion plan to stem home foreclosures may only add to the country's fiscal and housing problems.

Cantor, on CBS on Monday, worried that another government program could hurt taxpayers. Obama is expected this week to unveil a plan to help prevent foreclosures, perhaps by giving federal subsidies allowing reductions in mortgage payments. Though Cantor said he supported some sort of government effort to to get lenders to lessen payments, he expressed concern about the program's price tag.

"Homeowners, right now, are suffering under skyrocketing property taxes. And if we put the bill for $50 billion plus on top of all the bills that families have right now, you may very well be set to encourage more foreclosures," said Cantor.

Cantor said that the vast majority of U.S. families are keeping up with mortgage payments and are wondering who will pay for the "continued succession of bailouts.
"Skyrocketing property taxes"? Has somebody explained to Cantor that with home values plummeting a good 20% or more in the last year, the assessed taxes on what those homes are worth are also plummeting? Isn't the fact that property taxes are falling so precipitously along with home values a major reason why states like Kansas and California are going broke?

Or is he really this effing stupid because the House GOP has no intention of ever working with Obama on any issue whatsoever?


Related Posts with Thumbnails