ElizabethWarren:Youknowwho’sreallytoblame

Elizabeth Warren: You know who’s really to blame for this financial crisis and middle-class erosion? Reagan.

posted at 8:41 pm on May 20, 2014 by Erika Johnsen

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Because when President Barack Obama was blaming every problem under the sun on his predecessor President George W. Bush, he just wasn’t go back far enough. Via RCP:

WARREN: I grew up in an America that was investing in kids. It was investing in public universities. It had a higher minimum wage. It was an America that said every kid would get a fighting chance. And that’s how we built America’s great middle class. Then starting in about the 1980s, we turned in a different direction.

COLBERT: You mean when Reagan came in and it was morning in America. The direction toward greatness, pride. …

WARREN: That’s right. And what happened is that he had a couple of ideas. The first one was that they would fire the cops. Not the ones on Main Street but the ones on Wall Street.

COLBERT: The ones who were shackling creativity, and ingenuity in our financial institutions.

WARREN: And making sure the biggest financial institutions actually followed the law. Those were the cops they got rid of.

COLBERT: The law – that’s a vague term, law. Your — one man’s law is another person’s regulations. And regulation is bad. Regulation stifles business and stifles entrepreneurship.

WARREN: No, no. no. See if we don’t have happens is exactly what happened then. And that is the big financial institutions made billions of dollars by cheating people on credit cards, mortgages.

COLBERT: What do you mean cheating people on credit cards? You sign up for a credit card, you use the credit card and then you have to pay your bills. Is that too complicated for Harvard? …

WARREN: Let’s be clear about this. It was supporting having the regulators look the other way while the biggest financial institutions did every trick and every trap possible in credit cards, in mortgages, in checking account rules. And they made billions of dollars doing it. And at the same time they loaded up on risk. And what ultimately happened by 2008 was that they broke the economy. They got bailed out by the taxpayers. They continued to break the law in foreclosing on people’s mortgages.

After such a strong dose of oversimplified yet underhanded populism, all I can do at the moment is point you to the WSJ’s review of her book she was on Colbert’s show promoting… and shake. My. Head.

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Tags: Dodd-Frank, Elizabeth Warren, finance, Massachusetts, populism, progressive, Ronald Reagan

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Source from: hotair

ObamaadminofficialsoddlynotdownsizingFannieMae/Freddie

Obama admin officials oddly not downsizing Fannie Mae/Freddie Mac like they proposed to do

posted at 1:21 pm on May 15, 2014 by Erika Johnsen

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As recently of his State of the Union address this past January, President Obama was reaffirming the support he announced last August for bipartisan plans making their way through both chambers of Congress to drastically reduce and/or eliminate the two lending giants’ outsized footprint in the housing market, pressuring lawmakers to “send me legislation that protects taxpayers from footing the bill for a housing crisis ever again, and keeps the dream of homeownership alive” by shifting the market more toward private lending. Opposition to the plan’s practical implications from some highly interested parties in the housing sector, as well as the upcoming midterm elections, have put Congress’s legislative role in the Fannie/Freddie drawdown in fuzzy and protracted territory — so in what will doubtless be the long interim before we see any major Congressional action on that front, the Obama administration is now planning to use their regulatory authority to… ramp up their role in the mortgage market and basically promote more risky lending? What? Via the NYT:

The federal overseer of Fannie Mae and Freddie Mac on Tuesday announced a shift in policies intended to maintain the mortgage finance giants’ role in parts of the housing market, spur more home lending and aid distressed homeowners.

“Our overriding objective is to ensure that there is broad liquidity in the housing finance market and to do so in a way that is safe and sound,” Melvin L. Watt, the new head of the Federal Housing Finance Agency, said in a speech at the Brookings Institution in Washington. …

Mr. Watt’s changes would perpetuate the presence of the two government-sponsored enterprises in mortgage finance, rather than shrinking it. …

Mr. Watt laid out several specific measures. For example, rather than reducing current limits on the size of the loans they guarantee, as previously proposed by the former overseer, Fannie and Freddie would keep the current, relatively loose, limits in place. The two enterprises back about two-thirds of all new mortgages.

The White House, via Jay Carney, applauded “the Federal Housing Finance Agency for issuing certainty and clarity on the rules of the road for loans backed by Fannie Mae and Freddie Mac” on Tuesday, and as Bloomberg notes:

Watt’s policy decisions will play an increasingly pivotal role in the nation’s housing finance system as bipartisan efforts to wind down Fannie Mae and Freddie Mac appear to be stalling in the Senate.

The Senate Banking Committee is expected to vote Thursday on a measure that would replace the two companies with a reinsurer of mortgage bonds that would suffer losses only after private capital was wiped out. The bill doesn’t have enough Democratic support to advance beyond the committee and legislative efforts to remake Fannie Mae and Freddie Mac are unlikely to continue before next year.

Well. So much for that, and in the meantime, it looks like the Obama administration just couldn’t resist the urge to keep getting the federal government increasingly involved in the economy.

For what it’s worth, here’s what the former top regulator of the Federal Housing Finance Agency preceding Watt had to say on Fannie/Freddie at another event this week, via the WSJ:

A few hours later, his predecessor, Edward DeMarco, offered some parting reflections on housing policy at a banking conference in Charlotte, N.C. …

In his talk, Mr. DeMarco made an impassioned plea to abandon the housing-finance system dominated by Fannie Mae and Freddie Mac, the companies he oversaw as the FHFA’s acting director for the past five years. “Rather than striving to preserve a system that failed so spectacularly and in so many ways, we need to find our courage and our creativity to build a new system,” he said in prepared remarks. …

“Restoring Fannie Mae and Freddie Mac is not the solution. They failed and their business model failed,” he said. “Going backwards to an obviously failed model cannot be dressed up with some promise of higher capital or explicit rather than implicit guarantees.”

Mr. DeMarco pushed back against the idea, made repeatedly by critics of the House and Senate bills, that “something new is ‘risky’ or that we cannot do better than what we had,” he said. “Often you will find someone protecting an existing interest…in preserving the status quo.”

Finally, he warned against calls for the government to help unqualified borrowers buy homes. “A government effort to assist families with limited resources and poor credit history take on increased leverage seems a curious public policy,” he said.

 

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Tags: Fannie Mae, finance, financial crisis, Freddie Mac, housing, Obama administration, regulation

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Source from: hotair

Supreme Court strikes down aggregate limits on campaign contributions on First Amendment grounds

SupremeCourtstrikesdownaggregatelimitsoncampaign

PutinreinstitutesaSoviet-erafitnessprogramwhileKim

Putin reinstitutes a Soviet-era fitness program while Kim Jong Un forces everyone to get his haircut

posted at 9:01 pm on March 26, 2014 by Erika Johnsen

I happened across both of these stories today out of Everybody’s Favorite Saber-Rattling Gulag State and America’s Bestest Frenemy, and I don’t even… obviously, “palate cleanser” is not the right term here. Whatever the antonym of “palate cleanser” is, this is that.

Until now, everyone in North Korea had to choose their haircuts from a list of state-approved styles. But now, all men in the hermit kingdom will be required to sport the same hairstyle as supreme leader Kim Jong Un, the BBC reports.

Pyongyang introduced the new law two weeks ago but is now rolling it out across the country. Unfortunately, some North Koreans may not be thrilled about the new look. According to a former Pyongyang resident now living in China, the Kim Jong Un cut is unpopular because it apparently resembles the style of Chinese smugglers. “Until the mid-2000s, we called it the ‘Chinese smuggler haircut,” the source told the Korea Times.

Women, however, will still be able to choose from a small variety of state-sanctioned hairstyles. So, there’s that. You’re welcome?

And over in Russia, via Charles Recknagel:

If you could turn back the hands of time, what would you wish for? For Russian President Vladimir Putin, it seems to be to return to the days of mass physical fitness. Not just of physical-education training in schools—which already exists in Russia—but of mass calisthenics in stadiums, mass parades of athletes through Moscow’s Red Square, and fluttering banners with slogans urging ‘Everyone to the Starting Line!’

On March 24, Putin, a well-known fitness buff, signed an executive order to bring it all back. He ordered the revival of a Stalin-era fitness program from the 1930s called “Ready for Labor and Defense,” or “GTO” by its Russian initials. The state-sponsored program, which mixed fitness, health, and patriotism, had been moribund since the collapse of the Soviet Union, when it fell victim to Russians’ suddenly greater freedoms of choice. …

In signing his decree, Putin did not specify why he wanted to bring back the GTO in its Soviet-era form, complete with the pomp and parades. He only said his government had been considering “how to attract the vast majority of our citizens to take part in regular physical training” and that “reviving the GTO would “pay homage to our national historical traditions.”

No word yet on what exactly the program will look like or just how mandatory it will be in its modern form, but whatever it is, it’s set to begin anew this September — so get excited to get fighting fit, comrade!

And, just to top off the list of things the world’s varying degrees of central planners did today, here’s the latest out of Cuba, which has now decided that it would like to try its hand at luring foreign businesses and investment, the better to integrate Cuba into the global economy. Why companies and investors haven’t shown much interest in doing business with the communist country before now, I simply can’t imagine.

Cuba is proposing a new Cuban foreign investment law that would cut the profits tax in half to 15 percent and exempt most investors from paying it for at least eight years, official media said on Wednesday. …

Cuba is promising legal protection for foreign investors, who have generally been averse to risking capital in the Soviet-style economy, and new incentives such as dramatically lowered tax. The National Assembly is expected to approve the draft of the law with little, or no changes.

However, foreign ventures that mine natural resources, including oil, can be subject to a higher profits tax of up to 22.5 percent, depending on how those ventures are negotiated with the state, according to details published in the official Juventud Rebelde newspaper.

Tags: Cuba, finance, North Korea, Russia, totalitarianism

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Source from: hotair

The number of Americans who renounced their citizenship in 2013 just shattered 2011′s record

ThenumberofAmericanswhorenouncedtheircitizenship

JudgeclearsDetroitforbankruptcyprotection posted

Judge clears Detroit for bankruptcy protection

posted at 1:21 pm on December 3, 2013 by Erika Johnsen

It took about five months of political, legal, and financial finagling, but a bankruptcy judge has ruled that Detroit is now finally, officially eligible for bankruptcy protection in what is now the largest municipal bankruptcy in U.S. history after the decades on decades of profligate and purely progressive leadership steadily ground Detroit down from its postwar status as America’s fourth-largest city. Via NBC:

“The city no longer has the resources to provide its citizens with basic police, fire and emergency services,” Judge Rhodes said, ruling that Detroit, once the nation’s fourth-largest city, “was and is insolvent.”

The long-awaited decision sets up a bitter battle between the city’s finance officials and its unions, creditors and retirees, who expect deep cuts in pensions and sales of treasured city assets, such as its art collection, as part of the Chapter 9 process. …

In the meantime, Detroit’s emergency financial manager, Kevyn Orr, is expected to proceed towards the city’s next major step: submitting a plan to adjust Detroit’s approximately $18 billion in debt. Judge Rhodes said he will not stay the bankruptcy proceedings in the wake of any possible appeals.

From the beginning, the overwhelming sticking point of the bankruptcy filing was whether or not the city’s managers negotiated “in good faith” with the relevant unions and pensioners, usually a prerequisite for bankruptcy eligibility and one which the unions vehemently argued that the city categorically did not meet. The judge ruled that the city may have left something to be desired on that front, but that it’s also kind of impossible to negotiate with a “stone wall” and that the city’s extremely dire financial woes were the trump card here.

The legal battle certainly isn’t over, however; no doubt the unions will continue to appeal the ruling as many times as they possibly can, and the judge did iterate that he would be keeping a watchful eye over the proceedings, but the good news is that municipal managers can at last get to work on submitting a plan to pay off part of Detroit’s more than $18 billion in debts and to start reinvesting in the severely lacking essential services. As the judge noted in his ruling:

“We have here a judicial finding that this once-proud city cannot pay its debts. At the same time, it has an opportunity for a fresh start. I hope that everybody associated with the city will recognize that opportunity.”

Tags: bankruptcy, Democrats, Detroit, finance, pension, unions

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Source from: hotair