Bushed again! This time its the Banking System

[telcoman]

Who else besides Bush can be blaimed for this latest failure?

First it was Freddy and Fanny last week and today it is Lehman and Merrill Lynch.

I would have to guess that those executives responsible for these lastest failures will get their huge bonuses while tens of thousands of their employees will be laid off.

"The fates of Merrill Lynch and Lehman Brothers would not seem to be linked; Merrill has the nation’s largest brokerage force and its name is known in towns across America, while Lehman’s main customers are big institutions. But during the credit boom both firms piled into risky real estate and ended up severely weakened, with inadequate capital and toxic assets. "

While offering to help Wall Street organize a shotgun marriage for Lehman, both the Fed chairman, Ben S. Bernanke, and Mr. Paulson had warned that they would not put taxpayer money at risk simply to prevent a Lehman collapse.

The message marked a major change in strategy but it remained unclear until at least Friday what would happen. “They were faced after Bear Stearns with the problem of where to draw the line,” said Laurence H. Meyer, a former Fed governor who is now vice chairman of Macroeconomic Advisors, a forecasting firm. “It became clear that this piecemeal, patchwork, case-by-case approach might not get the job done.”

Both Mr. Paulson and Mr. Bernanke worried that they had already gone much further than they had ever wanted, first by underwriting the takeover of Bear Stearns in March and by the far bigger bailout of Fannie Mae and Freddie Mac.

"Outside the public eye, Fed officials had acquired much more information since March about the interconnections and cross-exposure to risk among Wall Street investment banks, hedge funds and traders in the vast market for credit-default swaps and other derivatives. In the end, both Wall Street and the Fed blinked."

Put lipstick on these executives and they are still pigs

http://www.nytimes.com/2008/09....html?

http://hosted.ap.org/dynamic/s...FAULT

Telcoman


Modified by telcoman at 5:44 AM 9/15/2008

[HashiriyaS14]

I have no idea how Lehman's failure could conceivably be linked to George W. Bush.

Investment Banks are big, interconnected entities. Unfortunately, they had made some huge bets on real estate and then had to take subsequent write-downs. They're reporting massive losses and this has overridden success in other lines of their business (IBD, FI S&T, etc).

This is a 100% private failure with a 100% private solution.

I'm all for blaming Bush when blame is due, I'm not more a fan of the guy than you are, but this is NOT legitimate. This has nothing to do with the administration.

I'm in the same field (RE private equity) as is the arm of Lehman that got hammered. We're doing just fine. It's not some sector-wide calamity, some people were just stupidly over-leveraged (looking at you, Carlyle!).

Shxt happens.

[Cold_Zero]

I think it's quite evident that you, Telco and most other uninformed people in this country don't want a President to run this country, they want a dictator who controls every aspect of life to guarantee that nothing goes wrong. When something fails in this country, you think the Federal Government should step in and nationalize it. Yet when the Federal Government fails in its mandate, more money and bigger programs should be created to fix the problem.

Look, each system has its built in circuit breakers. When something fails, as in these major investment firms not doing their due diligence by running Risk Analysis on the loans they were purchasing from the Mortgage Lenders, then these firms fail with their investor confidence being shaken, the stock price then drops and either Wall Street steps in or the firms have to file bankruptcy. Merrill Lynch is a perfect example. Wall Street stepped in and Bank of America purchased Merrill Lynch. Very simple concept. When this happens on a grander scale, the market slows down and other market forces react to counter balance the effects. You do realize that a "Recession" and a "Depression" are part of the financial life cycle? And they serve their own purpose in the cycle.

But make no mistake, the troubles that Lehman Brothers, Merrill Lynch, Bear Sterns are not Bush's fault. These publicly traded firms have CEOs, CFOs, Investors and equivalents to Portfolio and Credit Management divisions that are suppose to be watching out for their firm's best interest. If these companies or other companies not related to investing do not do their due diligence when investing, that is their own damn fault!Now Freddie and Fannie are a little bit different because they are GSEs (Government Sponsored Enterprises). Other than the obligatory regulations that the Federal Government, there is no guarantee with investors that GSEs debt, assets and securities are backed by the Federal Government. Also, George Bush does not run the Banking System in this country and no President does. While he does nominate the Chairman of the Federal Reserve, he is not the king of the nation's banking system.

Nice try, why not stick to something you know something about.

[AZhitman]

There's some educatifyin' goin' on in here...

It never ceases to amaze me that the left can, on the one hand, deride GWB for being functionally mentally retarded.... yet he's apparently smart enough to single-handedly cause the downfall of banking, wipe out Black people with hurricanes, arrange a terrorlst attack on New York City, and line his pockets with Middle-Eastern oil profits.

[Encryptshun]

One out of four ain't bad.

[Eikon]

WOW..

This thread is awesome! Great input from those above.

Yep... Telco got owned again.

I'll take some credit personally for Lehman going down the tubes. They used to own a company called Aurora Loan Services. That company was awesome!!! They would take loans that nobody else in their right mind would touch.... I'm talking 1st and 2nd mortgage piggie-backs to 100% financed on investment properties for buyers with stated income and stated assets. Dude.. I could have financed my 2 year old son through Aurora.

Aurora went out of biz. about 8 months ago. Somebody finally realized they were completely insane and finally pulled the plug on it. But the damage had been done.. the debt passed on to Lehman must have been very damaging...

Then add to that the huge holdings they had directly in mortgage backed securities that has been performing very poorly... they just couldn't handle it. Time to close up shop.

Yep.. that Damn George Bush.. He must have been behind the scenes underwriting the loans, and chosing the investment vehicles that Lehman used.

[smockers83]

Who else besides Bush can be blaimed for this latest failure?

Umm, lots of other people

When will you ever understand? Did you spend too much time in East Germany or the USSR or something?

If you can blame Bush for this, I can blame Obama, Ted Kennedy, and Pelosi.

[Cold_Zero]

Then add to that the huge holdings they had directly in mortgage backed securities that has been performing very poorly... they just couldn't handle it. Time to close up shop.

No doubt, we securitize loans that are backed by the Federal Government and no one (I mean no one) is investing in asset backed securities right now. Kind of hard to raise money when no one is purchasing these things.

[hsckris]

Yep... Telco got owned again.

Maybe its just me, but I really question why he keeps posting. I guess what I am trying to say is that I'm not posting about how to work on the attessa awd system. Why? B/c I have no clue about it. Since Telco has no clue about politics....

[S13_love]

As much as I would hate to say this...but i dont think you can blame bush for this one. At most, you probably can say that he and his administration sat back and did nothing to help our economy out (those stimulus checks were a horrible idea). The one who is at fault here...well i dont know, maybe the executives cause they obviously failed...big time

[Eikon]

Actually, from what it sounds like.. the stimulus checks helped the economy... so much so that the Dems are talking about pushing another round of them out this winter.

The Pres really has little control over the real estate and banking systems. Sure he can appoint officials to the Fed, etc... but he really doesn't have much chance to exert any real action.

Hindsight being 20-20... sure he would have been able to do something to help the situation.... but of course... that's hindsight.

[S13_love]

Actually, from what it sounds like.. the stimulus checks helped the economy...

hmm... more or less, i mean i can guarantee you majority of those checks went immediately to pay off debts...and gas, sure it did help but not as much as it should have

[telcoman]

Maybe its just me, but I really question why he keeps posting. I guess what I am trying to say is that I'm not posting about how to work on the attessa awd system. Why? B/c I have no clue about it. Since Telco has no clue about politics....

Sorry, I keep forgetting this forum is only for Bush supporters.

I'm a little confused. Let me see if I have this straight.....

* If you grow up in Hawaii, raised by your grandparents, you're 'exotic, different.'* Grow up in Alaska eating mooseburgers, a quintessential American story.

* If your name is Barack you're a radical, unpatriotic Muslim.* Name your kids Willow, Trig and Track, you're a maverick.

* Graduate from Harvard law School and you are unstable.* Attend 5 different small colleges before graduating, you're well grounded.



* If you spend 3 years as a brilliant community organizer, become the first black President of the Harvard Law Review, create a voter registration drive that registers 150,000 new voters, spend 12 years as a Constitutional Law professor, spend 8 years as a State Senator representing a district with over 750,000 people, become chairman of the state Senate's Health and Human Services committee, spend 4 years in the United States Senate representing astate of 13 million people while sponsoring 131 bills and serving on the Foreign Affairs, Environment and Public Works and Veteran's Affairs committees, you don't have any real leadership experience.* If your total resume is: local weather girl, 4 years on the city council and 6 years as the mayor of a town with less than 7,000 people, 20 months as the governor of a state with only 650,000 people, then you're qualified to become the country's second highest ranking executive.



* If you have been married to the same woman for 19 years while raising 2 beautiful daughters, all within Protestant churches, you're not a real Christian.* If you cheated on your first wife with a rich heiress, and left your disfigured wife and married the heiress the next month, you're a Christian.



* If you teach responsible, age appropriate sex education, including the proper use of birth control, you are eroding the fiber of society.* If , while governor, you staunchly advocate abstinence only, with no other option in sex education in your state's school system while your unwed teen daughter ends up pregnant , you're very responsible.



* If your wife is a Harvard graduate laywer who gave up a position in a prestigious law firm to work for the betterment of her inner city community, then gave that up to raise a family, your family's values don't represent America's.* If you're husband is nicknamed 'First Dude', with at least one DWI conviction and no college education, who didn't register to vote until age 25 and once was a member of a group that advocated the secession of Alaska from the USA, your family is extremely admirable.

OK, much clearer now.

-----------------------------------------------------------------------------------

As far as the banking system is concerned, if the POTUS appoints only unqualified people (remember brownie & Katrana) to positions that they are unqualified for, then what has occured over the past eight years under Bush are the results the American people are experiencing today.

The republican party does not believe in any regulation or oversight of the banking system so the American people are now experiencing the result.Check out the unemployment numbers when Bush entered office vs now.Check out the national debt when Bush entered office vs now and you may begin to understand?

Palin put her high school friends into positions in the Alaska state government that they were unqualified for so what would one expect should she become president?

McCain is a war hero and an American Patriot but he is nothing more than an extension of failed Bush policies.

From today's Wall Street Journal

"Those currently in power need to remember that modern markets move quickly. They may not be able to pass the problem to their successors. U.S. history and the international experience teach a hard lesson: Delaying the resolution of financial crisis only makes it more costly."

Mr. Reinhart, the former director of monetary affairs at the Federal Reserve Board, is a resident scholar at the American Enterprise Institute.

Telcoman
Modified by telcoman at 4:33 AM 9/16/2008

[HashiriyaS14]

^^Don't give me all this "boo hoo" garbage.

I'm obviously one of the more ardent Obama supporters here, I'm working on the man's campaign in MD and VA, and I STILL was the *first* person to call BS on that first post.

It's one thing to support your party and your candidate and then it's another to vent frustration through questionable logic. Doing the latter just undermines your position and your credibility.

What's the point of this thread? That Bush is a shxtty President? That's not new news, and it certainly doesn't have anything to do with the Lehman collapse. Threads need to be SPECIFIC in their intent, every thread can't degenerate into an argument on the same Obama vs. McCain talking points.

I obviously agree with your points on a lot of the post directly above, but that doesn't mean any of it pertains to this thread in particular.

[hsckris]

Sorry, I keep forgetting this forum is only for Bush supporters.

My point wasn't about which way you lean, but how you consistently post irrelevant or incorrect garbage. This thread is a perfect example. You blame Bush for something that he simply did not do/is not in control of, and end up talking about BO and Palin. People on the board who lean right and who lean left have pointed out the fact that Bush couldn't possibly have done what you claim he did in this thread. That you cannot recognize this only illustrates the problem. Again, if you don't understand something, why post about it?


Modified by hsckris at 8:17 AM 9/16/2008

[Cold_Zero]

Sorry, I keep forgetting this forum is only for Bush supporters.

I'm a little confused. Let me see if I have this straight.....

* If you grow up in Hawaii, raised by your grandparents, you're 'exotic, different.'* Grow up in Alaska eating mooseburgers, a quintessential American story.

* If your name is Barack you're a radical, unpatriotic Muslim.* Name your kids Willow, Trig and Track, you're a maverick.

* Graduate from Harvard law School and you are unstable.* Attend 5 different small colleges before graduating, you're well grounded.



* If you spend 3 years as a brilliant community organizer, become the first black President of the Harvard Law Review, create a voter registration drive that registers 150,000 new voters, spend 12 years as a Constitutional Law professor, spend 8 years as a State Senator representing a district with over 750,000 people, become chairman of the state Senate's Health and Human Services committee, spend 4 years in the United States Senate representing astate of 13 million people while sponsoring 131 bills and serving on the Foreign Affairs, Environment and Public Works and Veteran's Affairs committees, you don't have any real leadership experience.* If your total resume is: local weather girl, 4 years on the city council and 6 years as the mayor of a town with less than 7,000 people, 20 months as the governor of a state with only 650,000 people, then you're qualified to become the country's second highest ranking executive.



* If you have been married to the same woman for 19 years while raising 2 beautiful daughters, all within Protestant churches, you're not a real Christian.* If you cheated on your first wife with a rich heiress, and left your disfigured wife and married the heiress the next month, you're a Christian.



* If you teach responsible, age appropriate sex education, including the proper use of birth control, you are eroding the fiber of society.* If , while governor, you staunchly advocate abstinence only, with no other option in sex education in your state's school system while your unwed teen daughter ends up pregnant , you're very responsible.



* If your wife is a Harvard graduate laywer who gave up a position in a prestigious law firm to work for the betterment of her inner city community, then gave that up to raise a family, your family's values don't represent America's.* If you're husband is nicknamed 'First Dude', with at least one DWI conviction and no college education, who didn't register to vote until age 25 and once was a member of a group that advocated the secession of Alaska from the USA, your family is extremely admirable.

OK, much clearer now.

-----------------------------------------------------------------------------------

As far as the banking system is concerned, if the POTUS appoints only unqualified people (remember brownie & Katrana) to positions that they are unqualified for, then what has occured over the past eight years under Bush are the results the American people are experiencing today.

The republican party does not believe in any regulation or oversight of the banking system so the American people are now experiencing the result.Check out the unemployment numbers when Bush entered office vs now.Check out the national debt when Bush entered office vs now and you may begin to understand?

Palin put her high school friends into positions in the Alaska state government that they were unqualified for so what would one expect should she become president?

McCain is a war hero and an American Patriot but he is nothing more than an extension of failed Bush policies.

From today's Wall Street Journal

"Those currently in power need to remember that modern markets move quickly. They may not be able to pass the problem to their successors. U.S. history and the international experience teach a hard lesson: Delaying the resolution of financial crisis only makes it more costly."

Mr. Reinhart, the former director of monetary affairs at the Federal Reserve Board, is a resident scholar at the American Enterprise Institute.

Telcoman

Modified by telcoman at 4:33 AM 9/16/2008

Telco,This is your first warning. If you have something to say about the current troubles in the financial markets in the United States or World Wide, please do so. But your whole rant about comparing Palin to Obama or McCain to Obama or the life story of any of them, especially when they have nothing really to do with the subject matter in this thread is distracting and off topic. bud

[srellim234]

Besides an administration that failed in its oversight responsibilities, I place the blame squarely on the Boards of Directors, executives and the stockholders of the corporations.

Stockholders, particularly large institutions like retirement funds, trading in and out of the stock markets put tremendous pressure on boards of directors and executives to manage the short-term stock price, not the long term business.

Because of that pressure, boards dilute the value of the outstanding stock by issuing stock options, outrageous guaranteed severance packages for executives, and "stock-only" purchases of other companies.

Company goes belly up or sells out? No problem. Board members who are on multiple boards have no need to protect the company long-term. They have other boards they belong to and they have generous compensation packages that allow them to retire if they want to. No need to give a rat's behind about the little guy they leave behind.

As long as stockholder keep voting for those types of executives, those are the types of executives we're going to get.

[AZhitman]

Let the record reflect that I've steered clear of this thread, because I have little to no comprehension of how the banking / insurance industry functions.

But I can't help but think of this thread when someone mentions "uninformed voters".

Perhaps the most informed are the least vocal.

[Cold_Zero]

Having listened to a few Earnings Calls for the company that I am employed with; I can't help but wonder what was the roll of the external and internal Financial Market Analysts with this mess? I seem to remember our CEO and CFO being crucified by Washington Mutual and Wells Fargo analysts over the percentage of growth in certain 'channel' volume as compared to other 'channels.' These analysts get into the minutia of the company and are intimate with the business models of these corporations. Why weren't they raising the red flag about these investment firms on their Earnings Calls? They sure as heck did it to us and caused our stock price to fall from the high 30's to the low teens. And we weren't doing any of this sub prime mortgage crap!

[telcoman]

Telco,This is your first warning. If you have something to say about the current troubles in the financial markets in the United States or World Wide, please do so. But your whole rant about comparing Palin to Obama or McCain to Obama or the life story of any of them, especially when they have nothing really to do with the subject matter in this thread is distracting and off topic. bud

I did. You left out this part.

As far as the banking system is concerned, if the POTUS appoints only unqualified people (remember brownie & Katrana) to positions that they are unqualified for, then what has occured over the past eight years under Bush are the results the American people are experiencing today.

The republican party does not believe in any regulation or oversight of the banking system so the American people are now experiencing the result.Check out the unemployment numbers when Bush entered office vs now.Check out the national debt when Bush entered office vs now and you may begin to understand?

Palin put her high school friends into positions in the Alaska state government that they were unqualified for so what would one expect should she become president?

McCain is a war hero and an American Patriot but he is nothing more than an extension of failed Bush policies.

From today's Wall Street Journal

"Those currently in power need to remember that modern markets move quickly. They may not be able to pass the problem to their successors. U.S. history and the international experience teach a hard lesson: Delaying the resolution of financial crisis only makes it more costly."

Mr. Reinhart, the former director of monetary affairs at the Federal Reserve Board, is a resident scholar at the American Enterprise Institute.

[audtatious]

I saw a beige sedan driving down the road that hit and killed a kid on a bike. Obama is a piece of **** for causing that to happen.

See, I can randomly blame your candidate for **** too

[AZhitman]

Bet it had a Hillary '08 sticker on it.

[Cold_Zero]

I did. You left out this part.

The warning was for the part that I did not leave out. Please consider yourself still warned, but I still look forward to participation in this thread.bud

[szh]

Who else besides Bush can be blaimed for this latest failure?

First it was Freddy and Fanny last week and today it is Lehman and Merrill Lynch.

Freddie and Fannie (check your spelling ... do you really know anything about them?) were privatized in 1995 or so ... and this may have been the start of the mortgage problems in this country. As has been noted by a number of prominent economists.

Wanna guess who was POTUS then? Mr. Cigar himself.

Regardless of which, making the case that either Bush or Clinton had anything to do with this financial market downturn is such a stretch that it goes beyond belief.

Z

[Cold_Zero]

Z-Freddie and Fannie may be privately owned and operated, but they are still GSEs. Once you become fully private then your charter is disolved by the Congress and the Federal Government can take its claws out of your back.bud

[Eikon]

Z-Freddie and Fannie may be privately owned and operated, but they are still GSEs. Once you become fully private then your charter is disolved by the Congress and the Federal Government can take its claws out of your back.bud

Bud, Correct me if I'm wrong, but didn't Freddie and Fannie recently change from privitizes GSE's (Government Sponsored Entities) to Conservitorships? I thought the news from two weekends ago was that the Govy was going to take them back into the fold and actually start overseeing them.

They used to be more like quasi-government entities... but now they are closer to being full agencies.

[Cold_Zero]

I will have to check with my brother in law (who also works for a Quasi Government Agency).I remember that we went from a full blown GSE, to a GSE that was publically traded company (but still under our orginal charter which limited us from doing things like being a bank to pick one thing) and now to a non GSE public company. There was that grey time in the middle there.

I believe that congress never took away their charter nor their GSE status prior to the government take over in Sept 2008. But Z's comment is wrong they have never been private companies. They were both GSEs, even after 1995 and publilcally traded on Wall Street.

Fannie Maehttp://www.fanniemae.com/about...e+Mae

Charterhttp://www.law.cornell.edu/usc....html

Freddie Machttp://www.freddiemac.com/corp...#BM6_

Charterhttp://www.freddiemac.com/gove...r.pdf

[Encryptshun]

I was so happy to find out that the government had taken over Fannie Mae and not Fannie May.

Government-managed candy? Do not want.

http://www.fanniemay.com/

[Cold_Zero]

If I get one more person that says, do you work for that Candy Company Fannie May.. I am going to go crazy.

Most of the GSEs end in MAE not MAY