On 04/24/2010 05:36 PM, WAYNE CHIRNSIDE -> ED HULETT wrote:
 -=>> ED HULETT wrote to WAYNE CHIRNSIDE <=-

 EH>> On 04/24/2010 02:50 AM, WAYNE CHIRNSIDE -> ED HULETT wrote:
 -=>>> ED HULETT wrote to WAYNE CHIRNSIDE <=-

 EH>>> On 04/23/2010 06:27 PM, WAYNE CHIRNSIDE -> ALL wrote:
 WC>>> Well well, it seems General Motors has paid back ALL
 WC>>> it's TARP funds with interest and 5 years early at that
 WC>>> so the U.S. taxpayer no longer owns GM as was
 WC>>> recently maintained here.

 WC>>> Another bit of good news.

 WC>>> Only a year ago the TARP bailouts were project to cost
 WC>>> 500 Billion, now the projected figure is 87 billion
 WC>>> with most of that accounted for by Freddie and Fannie.

 EH>>> Ahem, GM used the TARP money that was put in an escrow
account to "pay
 EH>>> back" the smaller amount that was called a loan. So,
basically, all
 EH>>> they did was take taxpayer money to pay back taxpayer
money. Plus, the
 EH>>> US government is still 60% owner of GM with the Canadian government
 EH>>> being a 12% owner. GM says they plan to fix that by issuing
an IPO and
 EH>>> go public... again... as if 72% government ownership isn't already
 EH>>> public.

 EH>>> Fannie and Freddie are the quasi government agencies that were at the
 EH>>> center of the housing bubble collapse.

 WC>> Nope, that's the propaganda now being sold.

 EH>> Sold by whom?

 WC>> Freddie and Fannie were the result of bad derivative packages sold to
 WC>> investors.

 EH>> Look up derivatives. You will find that you are arguing semantics.

 WC>> Fannie and Freddie were thus a result of Wall Streets misbehavior and
 WC>> irresponsibility
 WC>> as in the Abacus Investments derivative packages now in the news
 WC> sold by
 WC>> various investment
 WC>> firms such as Goldman Sachs.

 EH>> Hahahahahahahahahahahahahahahaha!!!!!!!

 WC> What a convincing rebuttal.

Your comment is so ridiculous it rebuts itself.

 EH>> Just keep on believing that.

 WC>> Then Goldman Sachs and other investment firms shorted the very Abacus
 WC>> Investment
 WC>> accounts they'd promoted to their clients betting against the very
 WC>> investments
 WC>> they had promoted.

 EH>> They did? Where did you get that information? BTW, you might want to
 EH>> contact the SEC with that to help their case against GS.

 WC> Uh they've enough problems to contend with dealing with their people
 WC> downloading porn rather than keeping an eye on the economic sector on
 WC> Wall Street.

So, they should drop their case against GS?

 WC> They couldn't even be bothered to look into charges about Bernard Madoff
 WC> despite YEARS of being told it was a ponsie scheme, during the last
 WC> administration BTW.

Madoff is in prison. Revising history must make you feel good.

 WC>> Since those deriviative investment packages largely consisted of
 WC> sub-prime
 WC>> loans of course when their lack of any value it impacted Fannie and
 EH>> Freddie

 EH>> Uh, it was federal law which mandated that investment banks take on
 EH>> sub-prime loans with Fannie and Freddie being formed by the federal
 EH>> government to buy those loans as part of that law to help investment
 EH>> banks stay solvent.

 WC> Nope it was the LACK of federal law and the LACK of banking oversight
 WC> produced by the Republican Congressman from Texas introducing the repeal
 WC> of Glass Steagall.

Take a look at the Community Reinvestment Act and get back to me. Glass
Steagall had little or nothing to do with the sub-prime loan bust.

 WC> Had Glass Steagall NOT been repealed in 1999 investment banking would have
 WC> remained forbidden to the banking industry and banking and investment firms
 WC> would have remained separate entities with derivatives limited
 WC> to investors willing to take on risks equivalent to the commodities
 WC> market where where you can go broke rahter quickly even after POURING
 WC> money into it.

Total nonsense.

 WC> That's for speculators, not people relying on their 401k's or
 WC> hedge funds and mutual fund accounts.

Huh?

 WC> Or it WAS until the repeal of Glass Steagal, now it's
 WC> akin to paramutual bettings only with much greater risk.

You have no earthly clue about which you speak.

 WC> With Glass Steagall in place.
 WC> The banks being unable to gamble with banking clients
 WC> accounts, 401k's and hedge funds these derivatives would
 WC> never have been able to initiate the banking meltdown as they'd have
 WC> to have made FINANCIALLY RESPONSIBLE mortage loans rather then to be so
 WC> eager
 WC> to bundle sub-prime mortgages into derivatives on 32 - 1 margins
 WC> in anticipation of huge profit at equally huge risk.

Fannie and Freddie were created to handle sub-primes and became overwhelmed
when defaults outnumbered solvent loans. It was federal law (Community
Reinvestment Act) that mandated banks give loans to people who had no
collateral and could not repay them (sub-prime loans) in the first place.
Even with Glass Seagall in place, there would still be a collapse in
sub-prime loans, in fact it may have happened sooner.

 WC> All this on account of the repeal of Glass Steagall.

Total nonsense. All you are doing is parroting Democrat boilerplate.

 WC>> Large banking institutions engaged in speculation with investors monies
 WC>> in derivatives is the cause.

 EH>> It was federal law that forced them into that practice. The
"Community
 EH>> Reinvestment Act" to be precise.

 WC>> Bill Clinton is partially to blame while the Republican Congressman
 WC> from
 WC>> Texas who first proposed the repeal of the Glass Steagall act is dead
 WC>> center
 WC>> to blame.

 EH>> Hahahahahahahahahahahahaha!!!!!

 EH>> You parrot left-wing talking points well.

 WC> Actually these are FACTS it appears you cannot be bothered to verify.

Verify by reading left-wing blogs like you do?

 WC>> Bill Clinton could have vetoed the repeal of Glass Steagall but his
 WC>> financial
 WC>> advisors
 WC>> advised him they would be good for the economy, he's recently come
 WC> out and
 WC>> admitted
 WC>> his mistake.

 EH>> Poor Slick, he was a victim of the bad old Republicans and poor advice.

 WC> I didn't say that, his finanacial advisors were members of his own cabinet.

What cabinet department were they members of?

 WC> The Republican Congressman from Texas didn't advise Bill Clinton,
 WC> rather he was persuaded NOT to veto the bill after Republicans pushed the
 WC> legislation through Congress.
 WC> It was his own cabinet advisors that led Clinton astray
 WC> and he's admitted to the error.

Sure, It's all the Republicans' fault. It is a GOVERNMENT problem! Not a
party problem.

 WC> Don't go building strawmen then claim points for refuting that
 WC> which I never said, that's dishonest and deceitful.

Huh? You're the one building Republican strawmen.

 EH>> Hahahahahahahahahahaha!!!!!

 WC> Another of your profound rebuttals?

I'm laughing at the idiocy of your claims.

 WC>> BTW The Glass Steagall Act was first enacted after the Great
 WC> Depression to
 WC>> prevent
 WC>> PRECISELY this sort of irresponsible lending by banking institutions.

 EH>> Do you even know what Glass Steagall is about?

 WC> YES, do you?

Yes. Actually there are two Glass-Steagall Acts, one in 1932 that gave the
Fed the ability to offer rediscounts. The second, in 1933 is the one you
are referring to and it WASN'T repealed entirely. It set up the FDIC (still
there), separated commercial and investment banks and gave the Fed the
power to set interest rates on savings accounts. In 1980, the Fed's power
to set interest rates on savings accounts was repealed and in 1999, the
Gramm-Leach-Bliley Act repealed the part that separated commercial and
investment banking.

The Graham-Leach-Bliley Act had nothing to do with the default of Fannie
and Freddie which set the house of cards on its cascade.

Of the 100+ bank failures since, few or none of them have been because of
the Graham-Leach-Bliley Act.

 WC> I can explain it to you if you like.

Hahahahahahahahaha!!!!

 WC>> It took a mere eight years after the repeal of the Glass Steagall Act
 WC>> for the house of cards to come crashing down.

 EH>> Glass Steagall has nothing to do with sub-prime loans.

 WC> No it does not, it separates speculative investment firms from the banking
 WC> industry.

Which had nothing to do with banks being saddled with sub-prime loans by
government fiat. The banks had to do something to keep from defaulting from
the sub-prime load they were expected to bear. Fannie and Freddie were set
up to ensure sub-prime loans, but they couldn't handle the load even though
they were quasi government entities. When Fannie and Freddie fell, it was
only a matter of time before banks fell and it started with the "too
big to fail" banks and has not abated. All of this can be placed at
the feet of the federal government and their misguided meddling.

 WC> That is NOT to say it's REPEAL had nothing to do with sub-prime
 WC> mortgages as
 WC> sub-prime mortgages gave investment banking the funds on 30 - 1 margin
 WC> to engage in the practice of selling worthless derivatives, than
 WC> shorting them.
 WC> Thus the financial collapse.

If not for government intervention and mandating that banks loan money to
people who had no collateral or way of paying back those loans, there would
not have been a sub-prime loan crisis.

 WC> Sub-prime loans were the SOURCE of the funds along with mutual funds and
 WC> 401k
 WC> the banks would not have been able to otherwise engage in investing in
 WC> woorthless derivatives had not Glass Steagal been repealed.

Glass-Steagal was NOT repealed, only some provisions of it were. Had they
not been repealed, the sub-prime collapse would have happened much earlier.

 WC> Rather more complicated than can be rebutted by your extended ha ha's
 WC> and numerous exclamation points.

All you are doing is parroting the Democrat talking points. All you can do
is point fingers at Republicans. When you stop trying to make this a
partisan talking point, you might see less "haha's" and
exclamation points.


 WC>> Actually only two years as the first down was Enron then WorldCom
 WC>> which should have alerted to these bad practices as these were
 WC> precisely
 WC>> the sort of speculative packages sold as derivatives.

 EH>> Hahahahahahahahahahahahahaha!!!!!!!

 WC> So you'd no idea that Enron spun off worthless assets to
 WC> subsidiaries in order to cook the books resulting in its collapse?

Your attempt to sound British is amusing. Ask Paul Krugmann what Enron did,
he was their financial adviser.

 WC> You appear to find all of this rather amusing from your
 WC> lack of rebuttal with any more depth than
"hahahahahaha..." with bunches
 WC> of exclaimation points

No, I find your trying to blame it all on Republicans amusing.

 WC>> IOW's both the Great Depression AND the current massive recession had
 WC>> almost identical causes.

 EH>> Yes, too much government meddling.

 WC> To Little, Glass Steagall "meddling" as you call it by
enforcing the
 WC> separation
 WC> of investment firms from banking firms held up for near seventy years
 WC> until repealed.

You have no idea about which you speak.

 WC> After that not eight years passed before the house of cards fell apart.

The house of cards falling had EVERYTHING to do with the Community
Reinvestment Act that set up Fanny Mae and later Freddie Mac and little to
do with the repeal of one provision of Glass-Steagall.

 WC> It's kind of like my taking monies from your savings account and 401K
 WC> and going off to the dog track and playing a few 6 dollar box
 WC> trifectas in hopes of hitting a big one.

Again, you haven't a clue.

 WC>> The Great Depression was caused by buying on margin and the current
 WC>> recession
 WC>> by speculation on derivative packages engaged in by large banking at up
 WC>> to 32 to 1 margin.

 EH>> Total bunk.

 WC> You don't watch a lot of PBS do you?

No, I don't watch left-wing propaganda.

 WC> Nor hit multiple and varied sources of information on the internet?

I get hundreds of Google alerts on several issues on a daily basis and get
several news feeds both on my computers and my Blackberry.

 WC> I hit BOTH Republican AND Democratic web sites and employ dialectic
 WC> reasoning
 WC> to arrive at my conclusions.

Sure you do. Your willingness to blame Republicans for everything and
excuse Democrats of all things is evidence that "dialectic
reasoning" is foreign to you.

 WC>> Just as the current recession hit investment banking was gambling with
 WC>> derivative packages of dubious value at the margin of 30 - 1 actual
 WC>> dollars, banking dollars, like those kept in checking anbd savings
 WC>> accounts.

 EH>> Who was supposed to lose WRT government mandated sub-prime loans? Were
 EH>> the banks just supposed to eat their losses when the borrowers were
 EH>> unable to pay their loan payments? It was federal law, CRA again, that
 EH>> mandated banks give loans to people who had no real means to pay those
 EH>> loans so the federal government could "right a wrong"
where there was
 EH>> none. Fannie, and then Freddie was set up to take on those toxic loans
 EH>> in an attempt to keep the banks from going bankrupt.

 WC>> It's rather easy to gamble with other peoples monies for short term
 WC> huge
 WC>> personal
 WC>> financial gain.

 EH>> Do you even have a clue what a sub-prime loan is and why banks were
 EH>> selling them to Fannie and Freddie? It wasn't for "short term huge
 EH>> personal financial gain."

 WC>> The current "fix" proposed by Democrats is to reduce
the magin from
 WC> 32 - 1
 WC>> to 10 to 1 and to limit the size to which large banks can grow.

 EH>> Oh yeah, limit freedom. That's always how Democrats think.

 WC> Limit irresponsible collusion between questionable investment firm
 WC> derivatives
 WC> and the nations banking customers assets in savings. checking and 401k's.

Uh huh... "irresponsible" by who's definition?

 WC> That's how critcal thinking people think regardless of party affiliation.

Something you haven't done.

 WC> You've something against the retirees wiped out in the derivatives
 WC> fueled economic crash?

Huh? Have you stopped beating your wife?

 WC> The crash FUELED by sub-prime mortgages bundled into derivatives
 WC> then shorted by the banking - investment firms that passed them off
 WC> to customers as sound investments?

Those "customers" were other banks and investment firms. How
would you propose the banks save themselves from default once all those
sub-primes started tanking? Again, do you know what a sub-prime loan is? A
sub-prime is a loan given to someone who has no means to pay it back and no
collateral beyond the house they bought with it. Those loans were mandated
by the Community Reinvestment Act. Instead of giving incentives for people
to better themselves, government usually saddles the rest of society with
the burden to pay for those who cannot pay for themselves.

 WC>> This amounts to a reinstatement of a rather watered down version of the
 WC>> Glass
 WC>> Steagall Act that had been rather effective in preventing such enormous
 WC>> financial meltdowns since the 1930's.

 EH>> Hahahahahahahahahahahahahaha!!!!!!!!

 WC> Another _convincing_ rebuttal.

Again, I wasn't rebutting anything, I was laughing at your partisan rant.

 WC>> The banks after the repeal of Glass Steagall rolled themselves into
 WC>> investment
 WC>> firms buying on margin just like individual investors in 1929 and just
 WC>> as in
 WC>> 1929 this came back and bit the American economy in the a**.

 EH>> You parrot the propaganda well.

 WC> Why don't you do a little research rather than just parroting Republican
 WC> taking points, Rush and Glenn Beck?

I'm not a Republican. I don't parrot any talking points.

What about Rush and Glenn Beck? Have you listened to either of them? Do you
know what they talk about?

 WC> I'm citing verifiable facts and history, your lack of comprehension of
 WC> these
 WC> facts
 WC> and history in no way indicates I've been the least bit influenced by
 WC> propaganda, that's your your shtick.

All you have done is parrot the left. Until you stop pointing at
Republicans and blaming them for all our ills, you aren't worth reading.

 WC> And yes I do indeed read The Wall Street Journal among a great many other
 WC> sources.
 WC> http://online.wsj.com/home-page

Woo hoo! Good for you. You have yet to show that you do.

Ed

-- 
"The ultimate result of shielding men from the effects of folly is
to fill the world with fools." --Herbert Spencer

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