CO-04 (Special Election)
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(R) Greg Lopez
(R) Trisha Calvarese
90%
10%
President (To Win Colorado)
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(D) Joe Biden*
(R) Donald Trump
80%
20%↓
CO-01 (Denver)
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(D) Diana DeGette*
90%
CO-02 (Boulder-ish)
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(D) Joe Neguse*
90%
CO-03 (West & Southern CO)
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(D) Adam Frisch
(R) Jeff Hurd
(R) Ron Hanks
40%
30%
20%
CO-04 (Northeast-ish Colorado)
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(R) Lauren Boebert
(R) Deborah Flora
(R) J. Sonnenberg
30%↑
15%↑
10%↓
CO-05 (Colorado Springs)
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(R) Dave Williams
(R) Jeff Crank
50%↓
50%↑
CO-06 (Aurora)
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(D) Jason Crow*
90%
CO-07 (Jefferson County)
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(D) Brittany Pettersen
85%↑
CO-08 (Northern Colo.)
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(D) Yadira Caraveo
(R) Gabe Evans
(R) Janak Joshi
60%↑
35%↓
30%↑
State Senate Majority
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DEMOCRATS
REPUBLICANS
80%
20%
State House Majority
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DEMOCRATS
REPUBLICANS
95%
5%
September 28, 2008 06:40 PM UTC
18 Comments
The $700 billion price tag is made up.
If we did this the right way, the initial outlay might be about this ($500 B is closer to my thought). I think it will end up costing about $250 B.
Make no mistake we are being mugged, but if we don’t do something we are going to get killed.
Another big bank is rumored to fail on monday without a bailout (still might with).
There were some things in the House GOP plan that I liked, including the investigations of the credit rating agencies, but for the most part it was unworkable (insurance? Remind me to call my insurance agency to get insurance when my house is already on fire).
We need to take a hard look at regulation. We have so eviserated the regulatory famework in this country that it threatens the soveriegnty of the US.
It’s forcing and giving incentives to banks to lend money to people that won’t pay it back.
The regulation of what those banks do with the bad loans is not the problem.
I hope you don’t actually believe what you are writing, I have more respect for you than that.
The problem was excess liquidty created by artificially low interst rates, misrated structured securities, leverage and a risk management system that focused on the individual actors not on the system.
As to the specifics of this conservative charge–Poor people and the Democrats concern for them.
Banks and finance companies are supposed to manage risks. They invest in things far riskier than home loans to poor people. Ermerging market non secured debt, non insured non rated municipal development revenue bonds. The trick is pricing them appropriately and provisioning against loss. You pay higher interst rates because they are supposed to be provisioning against Expected Loss.
The banks didn’t because they shipped the risk off balance sheet–no more risk for the bank–until it came back on to the balance sheet through misrated securities. However, because most banks were doing this the leverage was everywhere. The regulators didn’t see a thrat to the system because the executive philosophy didn’t allow them to see the problem.
The failure of regulation was that government did nothing to manage the system. When it became clear that housing starts were accelerating faster than household formation it was clear we were entering a bubble and the Fed should have upped interest rates and hit the banks harder on their provisioning and lending standards.
Chairman of the SEC, Chris Cox, REFUSED money for more regulators and REFUSED the authority to regulate the rating agencies. His sole focus was rolling back the Sarbanes-Oxley restricitions.
The limits on leverage were lifted on the broker/dealers were lifted in 2005.
The much GOP touted “regulation” of fannie and freddie in 2005 that failed wasn’t regulation it was actually deregulation–and it was pushed by fannie and freddie.
There was a failure to regulate because conservatives do not believe in regulation and you can not argue with that.
The mandatory making of risky loans – white, black, or polka dotted home owners – helped grease the skids of this fiasco.
However these policies are not the cause of it. These risky loans exacerbated a problem that had nothing directly to do with creative loan packaging.
A. This:
Is horseshit. ‘Concern for poor people’ doesn’t justify putting the taxpayers in a position to ultimately be responsible for $700 billion worth of shitty debt. Hopefully it will turn and the cost will eventually be much lower, but that presents an even bigger problem for free market folks. The possibility of the government taking over private debt and turning it into revenue. Think of the drool that would create in Washington.
As to the ultimate source of the problem, I disagree.
From WaPo:
It seems to me that basic greed is at the root of this issue. It’s like winning a bunch of money early in a poker game and not stepping away in time. With the Real Estate market growing like it did, even if someone defaulted on their loan, the property would be worth enough to sell it off at a small loss or a break even. I think this was totally encouraged by the managers of Freddie and Fannie, and by Dems like Barney Frank implying that not to make these risky loans basically amounted to racism.
So now, we, the prudent, who got loans based on income and what we knew we were able to pay back on time (I’m sure it’s most of us on this board) are going to ultimately foot the bill for folks that chose to take deals simply too good to be true, and the casino-style banks that lent them the money at the urging of the government.
who controled HUD?
The presidency, the house, the senate, the committees?
Trying to pin this on the Democrats is ridiculous when the GOP controlled every organ of government.
I think this bit is important
This policy worked when lending was fairly homogenous. Because securitization standards began to slip (because the rating agencies allowed them to slip), there were more subprime loans out there. Once subprimes picked up, the EL of those loans required higher capital charges and provisioning in a responsible risk management system, but the GOP’s resistance to any regulation didn’t allow it to happen.
Through as independent eyes as I can muster, it looks like the perfect storm:
A. Dems poking government’s nose where it doesn’t belong – telling banks whom to loan money to out of a sense of “justice”.
B. Republicans being unwilling to hold the loaners responsible for their own bad moves – protecting the CEO class.
And again, middle-class, tax-paying, moderate, responsible folks like most of us are screwed. Hard.
How’s that?
Then why is it that banks that held on to their mortgages and did not play games with all these weird istruments are doing fine – even thoug they also loaned to people that did not have a top credit rating?
From what I have heard, this plan releases $350 billion initially with a further $350 later pending Congressional okay. The actual cost to taxpayers in the long run will be far less, say $100 billion, which is much better than what would happen without a bailout.
Further, to complain that this doesn’t do everything is a bit daft in my opinion. There will be future legislation on this issue. This is the emergency aspect, but more regulation and broader economic stimulus will be in the pipe moving forward to address the more structural issues.
My way of putting it is this sucks big time, but sucks less than any alternative.
to establish “any” alternative.
It sucks less than what’s been on the table for the last week or so.
That doesn’t mean it has been studied exhaustively. Were were Bernanke and Paulson last month? Oh. That’s right. Bailing out specific associates of theirs on a case-by-case basis.
Has apparently been on the phone with his buddy Senator Obama.
who “suspended” his campaign to sing “Here I come to save the day,” and is at this very moment taking credit for solving the crisis in TV ads, is now a hero because he DIDN’T consult with anyone or contribute in any way to the deal? Obama and Paulson are now buddies? WTF?
The “NEW” regulatory structure was to deregulate Fannie and Freddie.
That was the wrong solution–I agree that the Democrats were pushing against the GOP plan in the GOP controlled house. But ultimately the Bill was defeated, because responsible Republicans realized the GOP deregulation regulation plan was a bad plan.
Raines was a pirate–that’s why he lost his job.
However, fannie and freddie are not the core of the problem. Fannie and Freddie were actually declining in importance in the market because of so called “private label” MBS. FNM and FRE used to control the MBS market, but by 2004 their share was down to 1/3 of what it was 10 years before. It was the rating agencies. FNM FRE were stretching because their market share was declining, but if they had pulled back there were plenty of private label MBS out there.
And BTW Franlikn Raines has talked to Obama once this spring–he is not an Obama advisor and the inclusion of that diminishes the entire argument.
After the Worst Speaker EvahВ® called House Republicans “unpatriotic” for not coming to a meeting on the bailout, the truth comes out…
Seriously? They “forgot” to invite them and then had the nerve to call them unpatriotic?
Words fail me.
I’ll take the article as true, but whole heartedly admit that Republicans confuse easily:-)
As my oldest daughter says.