Wednesday, June 17, 2009
US banks could become less competitive—and less profitable—from President Obama's proposed financial overhaul, analysts say.For those of you just joining us, in plain English, that means that that horrible Obama person recognizes that banks have made most of their money in the last ten years by bellying up to the derivatives craps table and rolling the dice.
As details of the sweeping plan emerged, there was worry among investors that the sector—which has been recovering in recent months from last year's financial crisis—could take another hit.
Among the biggest concerns: that increased regulation would reduce risk and leverage—which have been the main engines of growth in recent years.
Obama wants to put a limit on the table to try to keep these complulsive gamblers from losing another metric asston of cash. This of course equates to making U.S. banks "less competitive--and less profitable" if you happen to be the TV propaganda arm of the financial industry like CNBC.
Even if your industry nearly sinks the global economy and helps drop the country into the worst economic mess in decades, it's still all about picking on the poor banks.
Here endeth the lesson.
One of the most irritating things about the current Iranian uprising is that I’ve seen a spate of WWRD (What Would Ronnie Do?) posts all over the place. I’m not on my normal computer, so I don’t have my browser history to help me, but I know there was one or two at Hot Air, I know I’ve seen them at the NRO, and I’m pretty sure there was one at Commentary magazine. At any rate, you know what Reagan would do? Nothing. Why? Because he’s dead.Thank you. Should have been said a long time ago, especially when House Republicans are comparing Iranian protesters fighting a rigged election against a police state regime to...brave House Republicans.
[UPDATE] The stupid rolls on. Iran's state TV is accusing the US of interfering with Iran's elections, and the Wingers say this vindicates their position that Obama should go ahead and interfere with Iran's elections.
Obama has tiptoed on eggshells regarding the sudden onslaught of demonstrations and oppression, apparently believing that his lack of public effort on behalf of the protestors would win him brownie points with the Iranian mullahs. Obviously, Obama got this wrong, and it shows the naiveté of his entire approach on foreign policy, especially in the Middle East. Obama believes that our troubles there spring from American arrogance rather than the brutal, oppressive regimes that rule the area. His apology tour was designed to make America look humble and contrite, and Obama believes that will win the respect of dictators and kleptocrats.Because nothing will help more than the leader of the Great Satan to be broadcast all over Iran saying what a horrible guy Ahmedinejad is, reminding everyone there of the last eight years in the Bush School Of Nifty Middle East Relation Improvement.
That's worked out wonderfully so far.
Executives of three of the nation's largest health insurers told federal lawmakers in Washington on Tuesday that they would continue canceling medical coverage for some sick policyholders, despite withering criticism from Republican and Democratic members of Congress who decried the practice as unfair and abusive.As much as I've said that the GOP cannot allow Obamacare to pass from a purely selfish political standpoint, and that they will do everything to stop it from passing, that "everything" still does not include comitting political suicide by siding with these lovely people who refuse to stop denying coverage after the fact.
The hearing on the controversial action known as rescission, which has left thousands of Americans burdened with costly medical bills despite paying insurance premiums, began a day after President Obama outlined his proposals for revamping the nation's healthcare system.
An investigation by the House Subcommittee on Oversight and Investigations showed that health insurers WellPoint Inc., UnitedHealth Group and Assurant Inc. canceled the coverage of more than 20,000 people, allowing the companies to avoid paying more than $300 million in medical claims over a five-year period.
It also found that policyholders with breast cancer, lymphoma and more than 1,000 other conditions were targeted for rescission and that employees were praised in performance reviews for terminating the policies of customers with expensive illnesses.
"No one can defend, and I certainly cannot defend, the practice of canceling coverage after the fact," said Rep. Michael C. Burgess (R-Tex.), a member of the committee. "There is no acceptable minimum to denying coverage after the fact."
The executives -- Richard A. Collins, chief executive of UnitedHealth's Golden Rule Insurance Co.; Don Hamm, chief executive of Assurant Health and Brian Sassi, president of consumer business for WellPoint Inc., parent of Blue Cross of California -- were courteous and matter-of-fact in their testimony.
But they would not commit to limiting rescissions to only policyholders who intentionally lie or commit fraud to obtain coverage, a refusal that met with dismay from legislators on both sides of the political aisle.
Remember, the main reason we need a public option for health insurance is that privately owned health insurance companies are in the business of denying claims and making money off premiums and then not paying out coverage claims, not actually helping people. This is something that's so obvious that it's overlooked. Give Americans a public option that doesn't pull garbage like rescission and they will take it...and more importantly, private health care insurers will have to reform their business or lose customers to the public option. As K-Drum explains,
Even the Republicans on the committee couldn't defend the insurance company position. A few more hearings like this and getting a public option into healthcare reform is suddenly going to look like a real possibility. Nice going, guys.After the last couple of weeks, this is exactly the thing Democrats needed to help move the debate forward: a stark reminder that private insurance and health care ultimately are at odds.
[UPDATE] Eric Boehlert at Media Matters is one of the guys that gets it.
Republicans are the least-trusted group in America on health care reform...even less than the insurance companies. They know that they will get zero credit on Obamacare should it pass...and the passage of it will basically cast them into the wilderness for a generation. They know this. They know they have to stop it. Eric Boehlert understands this. More voices supporting health care reform need to recognize this basic fact.
We noted this morning that the right-wing's rather unhinged response to an ABC News special that hasn't even aired or been taped yet might be driven by the fact conservatives in the press don't want to see any kind of thoughtful debate on the issue of health care because, according to recent polls, it's such a big loser for the GOP.
That reading of the manufactured ABC News controversy is further supported by this:
The GOP will resort to just about anything to stop health care reform from passing. Period.
The difficulty of distinguishing between e-mail messages involving foreigners from those involving Americans was “one of the main things that drove” the Bush administration to push for a more flexible law in 2008, said Kenneth L. Wainstein, the homeland security adviser under President George W. Bush. That measure, which also resolved the long controversy over N.S.A.’s program of wiretapping without warrants by offering immunity to telecommunications companies, tacitly acknowledged that some amount of Americans’ e-mail would inevitably be captured by the N.S.A.But it's okay. Collecting millions of e-mails over the last several years is only done to protect you from yourself. Also, I'm sure President Obama will put an end to the practice any day now.
But even before that, the agency appears to have tolerated significant collection and examination of domestic e-mail messages without warrants, according to the former analyst, who spoke only on condition of anonymity.
He said he and other analysts were trained to use a secret database, code-named Pinwale, in 2005 that archived foreign and domestic e-mail messages. He said Pinwale allowed N.S.A. analysts to read large volumes of e-mail messages to and from Americans as long as they fell within certain limits — no more than 30 percent of any database search, he recalled being told — and Americans were not explicitly singled out in the searches.
The former analyst added that his instructors had warned against committing any abuses, telling his class that another analyst had been investigated because he had improperly accessed the personal e-mail of former President Bill Clinton.
Other intelligence officials confirmed the existence of the Pinwale e-mail database, but declined to provide further details.The recent concerns about N.S.A.’s domestic e-mail collection follow years of unresolved legal and operational concerns within the government over the issue. Current and former officials now say that the tracing of vast amounts of American e-mail traffic was at the heart of a crisis in 2004 at the hospital bedside of John Ashcroft, then the attorney general, as top Justice Department aides staged a near revolt over what they viewed as possibly illegal aspects of the N.S.A.’s surveillance operations.
But considering 90% of e-mail is spam, is the NSA actually, you know, getting good information?
This administration, the Congress and the DNC need to see the LGBT ATM shut down. NOW. That June 26 LGBT DNC fundraiser is toast. No one is buying a partner benefit plan that doesn't include health insurance, for god's sake. Will he announce an effort to send Congress something to act on? Uh, keep dreaming - his DOJ just wrote up a brief that uses defenses against incest and underage marriage to claim our relationships are unworthy of equal treatment under the law. They can't unring that bell.I'd have to agree with Pam's assessment. Not only does this seem like a completely obvious attempt to win favor back after last week's disastrous Department of Justice memo defending the Defense Of Marriage Act, but the annoucement itself seems to be of little actual import. The actual benefits apparently leave much to be desired and the whole plan comes across as ham-handed and half-assed.Mr. Obama will be weighing in for the first time on one of the most delicate social and political issues of the day: whether the government must provide benefits to same-sex partners of federal employees. While he will announce a list of benefits, officials said, they are not expected to include broad health insurance coverage, which could require legislation to achieve.Sorry WH brainiacs, the LGBT gala patient is bleeding to death because of your bludgeoning, and you haven't been left in the will. No $$$ for you.
...But administration officials said the timing of the announcement was intended to help contain the growing furor among gay rights groups. Several gay donors withdrew their sponsorship of a Democratic National Committee fund-raising event next week, where Vice President Joseph R. Biden Jr. is scheduled to speak.
UPDATE: It gets so much worse. This partner benefit plan is simply an administrative memo - it expires when Obama leaves office! LOLOLOL. FAIL-O-RAMA.
Seems like another Odubya moment to me.
Of course, things have been complicated on that score after thirty years of guardianship in Iran, where more than half of the Grand Ayatollahs reside. Nonetheless, the very principle that justifies the Supreme Leader has always rode on a thin reed. It could come crashing down quite quickly.Also, keep an eye on Nico Pitney's liveblogging on Iran over at HuffPo.
Residential real estate has finally found a floor, Cramer told viewers on Tuesday. The sector’s long, steep descent is all but over. He had predicted this day would come by the end of June, and he was right – with just two weeks to spare.That housing data link up there (showing that housing starts did jump significantly) includes this cautionary analysis:
How can Cramer be so sure? New housing data reported today showed a dramatic change for the better, especially in some of the hardest-hit areas in the US. That news, along with much lower prices and the working off of inventory, validate his prediction, made last August, that housing would stabilize this month, ending its multiyear declines.
"It's a sign that housing is stabilizing, but it's too early to say that we've seen the bottom. We'd probably need to see several months of stronger sales and better housing starts to give a convincing signal that we're going to see a housing recovery," said Gary Thayer, senior economist at Wells Fargo Advisors in St. Louis.Cramer of course is going for it. He has to, he has been predicting a housing bottom in June 2009 for 10 months now.
But here's the reality of the situation:
- Unemployment will most likely increase to above 10% very soon, with the U-6 pushing 18, possibly 20%.
- The second wave of forclosures caused by unemployment and resetting ARMs is already underway.
- Increased pressure on banks will come from the ongoing commercial real estate collapse.
That means housing prices have to fall. I said back in May that housing starts had to continue to fall under May's record lows, not rebound from them.
Cramer's not only wrong, but he should be fired. I'll keep revisiting this one to see how badly Cramer's call has failed.
[UPDATE] CalcRisk is a lot nicer than I am about it, but still says Cramer's wrong, mixing up the low in housing starts (which this probably is) with the low in prices (which it most certainly is not).
- Obama will sign an executive order today allowing for benefits for same-sex partners for federal employees.
- The President will also today lay out details of his plan to overhaul financial sector regulation.
- A growing rift in Iran's clerical ranks over Friday's election deepened as the senior ayatollah criticized the outcome.
- GM's German Opel division may have to slash new car prices by 40% to save jobs.
- A British government report advocates universal broadband by 2012...and the loss of that access for copyright violators.