Year: 2008

Loan Portfolio Limits Eased on GSEs. Disaster to Follow

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As a result of their accounting scandals Fannie Mae and Freddy Mac had their portfolios capped about 725 billion dollars, but regulators have now removed the caps.

This is, to quote Nietzsche, “Like the bite of a dog into a stone, it is a stupidity”.

The head of OFHEO, James Lockhart, will be eliminating the caps this week, and it looks like he will be reducing their capital requirements below the current 30% too.

Mr. Lockhart is an ass. At a time when the 2nd and 3rd largest borrowers in the world, after the US government, are facing a collapsing market, allowing them to go further out on a limb that is being sawed through is insane.

Rep. Markey Proposes Universal Access Bill for Wireless

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Rep. Markey has consistently been at the forefront of such things, and how he has proposed the Wireless Consumer Protection and Community Broadband Empowerment Act, which calls for the following:

  • Adequate and plain English disclosures about contracts.
  • Provision of more detailed coverage maps.
  • Require the sale of plans without early termination fees.
  • Require phone carriers to sell “subsidy free” phones.
  • Give municipalities the explicit right to offer broadband services, preempting state laws forbidding this.

Seems like a good bill to me.

Apologist for Racism, William F. Buckley Dead at 82

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My condolences to his family, but his record of endorsing racism and fascism should not be ignored.

He was a fervent supporter of Franco, and (of course) Joe McCarthy, and he kept himself amused by coming up with reprehensible justifications for Jim Crow.

Of course, he was well respected, because he was from the right family and went to Yale.

See Steve Gilliard’s post speak like a conservative where he quotes Buckley:

The central question that emerges . . . is whether the White community in the South is entitled to take such measures as are necessary to prevail, politically and culturally, in areas in which it does not prevail numerically? The sobering answer is Yes – the White community is so entitled because, for the time being, it is the advanced race. It is not easy, and it is unpleasant, to adduce statistics evidencing the cultural superiority of White over Negro: but it is a fact that obtrudes, one that cannot be hidden by ever-so-busy egalitarians and anthropologists.

National Review believes that the South’s premises are correct. . . . It is more important for the community, anywhere in the world, to affirm and live by civilized standards, than to bow to the demands of the numerical majority.

The irony was that at the end of his life, he was abandoned by the Neocon community that he helped to create, because he actually had a bit of sanity.

Unlike, for example, Norman Podhoretz, there is every indication that he knew what he was doing and knew better (I’m talking about the appeals to racism here), but was too fond of his own words to do the right thing.

He was a good writer and a witty man though.

Major Props to Senator Ben Cardin

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Earlier I wrote about my senator, Barbara Mikukski, and her voting for telco immunity, and the inadequacy of her response.

I also wrote to Ben Cardin, expressing my appreciation to him for voting against caving to George W. Bush. Major props to him:

Dear Mr. Saroff:

Thank you for contacting me regarding the President’s warrantless wiretapping program.

In February 2008 I voted against final passage of S. 2248, the FISA (Foreign Intelligence Surveillance Act) Amendments Act. The bill would have made permanent changes to the original FISA law in addition to many of the changes included in the Protect America Act (PAA). I am disappointed that the Senate has failed to a dequately improve the PAA which Congress enacted in August 2007, and which I also opposed . The PAA was intended to be a temporary solution to FISA, giving Congress the opportunity for a more careful consideration of amending the FISA law.

The President must have the necessary authority to track terrorists, intercept their communications, and disrupt their plots. Congress should make needed changes to FISA to account for changes in technology and rulings from the FISA Court involving purely international communications that pass through telecommunications routes in the United States . While we have a solemn obligation to protect the American people, we must simultaneously uphold the Constitution and protect our civil liberties.

After learning about executive branch abuses in the 1960s and 1970s, Congress passed very specific laws which authorize electronic surveillance. Congress has regularly updated these measures over the years to provide the executive branch the tools it needs to investigate terrorists, while preserving essential oversight mechanisms for the courts and the Congress. FISA requires the government to seek an order or warrant from the FISA Court before conducting electronic surveillance that may involve US persons. The Act also provides for post-surveillance notice to the FISA Court by the Attorney General in an emergency.

I am very concerned that the FISA law was disregarded by the Administration, and want to ensure that we put an end to this type of abuse. We are a nation of laws and no one is above the law, including the President and Attorney General. Congress has the right to know the extent of the warrantless wiretapping program and how it was initiated and changed over the years by this Administration.

I voted in favor of the Judiciary Committee substitute to the Intelligence Committee bill. The Judiciary Committee version strengthened Congressional and judicial review, including increasing the oversight by the FISA Court of the Administration’s wiretapping program. I am therefore very disappointed that the Senate rejected the Judiciary Committee substitute, and that the Senate has rejected numerous amendments – including an amendment that I had offered which would reduce the length of the reauthorization from six to four years – to improve this legislation.

I am hopeful that the House will make much needed improvements in this legislation during conference, and that I can support balanced legislation that gives the intelligence community the tools it needs to track terrorists and prevent attacks, while maintaining safeguards against the abuse of power by the executive branch. As a member of the Senate Judiciary Committee, I will continue to work to ensure the safety and security of the American people, as well as their civil liberties. Domestic eavesdropping raises serious and fundamental questions regarding the conduct of the war against terrorism, the Constitutional and privacy rights of Americans, and the separation of powers between the legislative, executive, and judicial branches. Congress must continue to work to strike the right balance, and we did not achieve that goal with this legislation.

Thank you again for contacting me, and please feel free to do so again in the future.

New York Times Puts Siegleman News Blackout in Alabama In OP/ED

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They write about the fact that WHNT, a CBS affiliate, went to black during the 60 minutes presentation of the politicization of the prosecution of former governor Don Siegleman.

Last two ‘graphs:

In 1969, the F.C.C. revoked the license of WLBT in Jackson after the commission established a systematic effort by the broadcaster to suppress information about the civil rights movement. Today, broadcast rules have changed, giving stations more leeway to decide what to air. Dropping a single report is unlikely to set the regulators in motion. Still, it would be deeply troubling if a partisan broadcaster could suppress information on the public airwaves and hide behind a technical fig leaf.

In this case, if the blackout was intentional, it may also have been counterproductive. Rather than take attention away from allegations that Mr. Siegelman was the victim of a partisan campaign, WHNT’s technical glitch seems to lend support to the charge.

Based on what is going on in Alabama, I’m coming to believe that this prosecution was driven by political considerations.

Otherwise, why would the GOP there be so freaked out and hypersensitive about this.

Economics Update

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The dollar has flirted with crossing the $1.50:€1.00 for months, and not that it has crossed the barrier, it’s continuing to weaken to new lows, with it currently around $1.51:€1.00.

Of course, it doesn’t help that Alan Greenspan is suggesting that the Gulf states drop their pegs to the dollar. I guess that he’s shorting the dollar or something now that he is “retired”.

On the bright side, the falling dollars is attracting overseas investors to US real estate, as it is now cheaper to buy.

In California, we have the California association of realtors reporting that new home sales are down 29.8%, and median price is down 21.9%.

Make no mistake this is a blood bath, and the numbers would be worse if they corrected for home size. The housing market is collapsing from the bottom up.

It will get worse, Fannie Mae has posted a $3.6 billion q4 loss, and I would expect something similar from Freddie, and we are still very early in the collapse of the housing bubble.

We may very see the collapse of Fannie and Freddie in the next 3 or so years.

This may explain why new home sales nation wide are at a 13 year low and why Mortgage application volume is falling off a cliff.

It doesn’t help that mortgage rates are no longer following the Fed rates because of inflation fears.

As the big sh^%pile continues to collapse, we are starting to see the inevitable lawsuits, with HSH Nordbank deciding to file suit against UBS, alleging that, “UBS’s management of the portfolio has been in breach of its contractual obligations and fiduciary duties and that substitutions were made solely for the benefit of UBS”.

We’ll be seeing a lot more of this.

Testifying before Congress, Ben Bernanke is expressing concern about both inflation and recession, aka “stagflation”, though the Fed is still shoveling money out the door, with another $30 billion auction of cash for garbage.

In the world of more real world finance, where people make money by making things, durable goods orders fall 5.3% last month, but oil is down a bit after getting above $102 a barrel.

It’s under $100, for now, on expectation of a recession.

Welfare for American Arms Manufacturer

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The US Army is now planning to replace the Iraqi Army’s AK-47s M-16s, claiming, among other things, that the M-16 is more reliable.

Yeah, right.

While the M-16 is unquestionably more accurate, reliability and cost are on the AK’s side. Additionally, this will require significant retraining.

This is just a way to get the M-16 into service so that Colt (or maybe FN, when I last checked they made weapons in South Carolina under license) make lots of money.

Dem Wins State Senate Special Election in New York

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Darrel Aubertine beat Will Barclay, taking the state senate to 32 Republicans and 31 Democrats in a special election.

FWIW, the last time that a Dem won this district was in the 1800s, so this does not bode well for the Republicans.

If one Republican switches sides, control of the state senate changes hands.

After that, the first order of business should be redistricting, at least on the state level.

In a state where registered Democrats outnumber registered Republicans by something like 4:1, it’s clear that some serious gerrymandering is going on and needs to be fixed.

Bush and His Evil Minions™ Choose Fat Cat Bankers Over Home Owners

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The ‘Phants in the Senate are threatening a filibuster, and the white house is threatening a veto over the Senate’s bill modifying bankruptcy laws to allow a judge to modify the terms of a loan on a primary residence.

Today, you can do this on your yacht, or your vacation home, or your rental property, but not on your loan.

Allowing so-called “cram downs” will not fix the problem, but it will make it better, and it will land squarely on the shoulders of the lenders who were the worst actors in this debacle.

Moussaoui Looks to Appeal His Guilty Conviction

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He is now claiming that he did not have effective counsel, because his lawyers could not fully brief him on the case, because of secrecy rules.

I don’t think that Mossaoui was the “20th Hijacker”. I think that he was a terrorist wannabee, and I think that he should be locked up for some time, though I’m not sure if that’s in a prison or a high security mental ward, but the fact that Bush and His Evil Minions™ screwed up this case just stuns me.

These guys could not organize themselves out of a wet paper bag.