Rolling US Economy Into The Shitbin Thread

no tips, I didn't mean for voting for Bam (tho it doesn't sound like you expected enough to be disappointed). I mean the "He'll fulfill our desires later in the term" posters.

He'll fulfill my desires, eventually, probably later on in the sperm

I am not defending this particular issue, which I think sucks, but do you really think people who have/had long-term aspirations for Obama's presidency were thinking in terms of weeks/months?

odds he'll be doing anything better in 2011? or that like Bill Clinton, he won't be worse as another campaign approaches?

open your eyes, dan... dudes been in office for FOUR MONTHS already!

yeah how many people has obama killed so far and then covered it up so it looks like a suicide--Vince Foster anyone?????

and he'll CHANGE! into a magic LIBERAL!!! LIKE V-CHIP BILLY IN A SCHOOL UNIFORM!

I had a reasonable response written out but what's the fucking point

V-CHIP BILLY

HI

(tho it doesn't sound like you expected enough to be disappointed)

well it's one thing to expect to be disappointed, another to experience it. it wouldn't be disappointment if it didn't feel ... disappointing.

but anyway, for whatever obvious weaknesses there are in the administration, there are much greater weaknesses in our system as a whole. i think the administration is, on balance, well intended, but feels politically constrained to operate within certain boundaries. whether they really are constrained that way or whether they're being more ginger than they need to be is up for debate -- i lean heavily toward the "they're being too soft" side. but on some issues (like the banks, like health care, possibly like energy policy), i'm starting to lean toward the view that the american system is just too corrupt at this point to correct itself. i don't know what that means in the long term, but it might mean that we cannot actually dislodge the assorted parasites attached to our economy and political system (banks, insurance companies, oil and coal companies, etc) and they're just going to feast until the host dies. i'd like to see obama fighting harder for all those things, but i don't know if it would even make a difference.

the important thing is not what obama does or doesn't do, but that dr. morbius is so much smarter than other posters on www.ilxor.com

stupidity not all that big a problem, it's denial.

what exactly is being denied here. use small words, i'm really dumb.

obama doesn't really want to fuck with the status quo that put him in the white house.

don't ever vote for anyone twice.

Morbius, I'm not sure what you want these guys to admit; they all read the goddamn paper.

http://12waystosayimsorry.com/sorrycover.png

that nothin matters & what if it did. xp

(srsly, rogermex's "dudes been in office for FOUR MONTHS already!" is the same old snotshit assholism that we're not seeing the breadth of Obama's ambition -- and his donkeydickless party -- right now. We are.)

i've read that the planet is irreversibly fucked unless China curbs greenhouse emissions by 2020. It won't. Game over.

You're much more eloquent when writing about Otto Preminger (who would direct a damn fine Obama movie).

some of us think the planet is fucked already

xxpost

http://hodgeblodge.files.wordpress.com/2009/01/irreversible-photo_04_hires.jpg

hey, if it's in the NYPost it must be bullshit; RIGHT?

"The real problem is that long-term unemployment is going up dramatically," said Franklin Allen, finance professor at the Wharton School. "Unfortunately, many people in their late 40s and 50s may never get jobs again," he wrote in a paper published this week....

According to the US Labor Dept., the average workweek fell to 33.1 hours in May -- down 1.7 percent compared to the year-earlier period. A shorter work week generally means less buying power for consumers. Consumer spending makes up 70 percent of the country's Gross Domestic Product.

http://www.nypost.com/seven/06142009/business/prepping_for_the_worse_174233.htm

hey, the french had to go on general strike to get a workweek that short! the free market provides!!

Oh Krugmanpaws (seven years ago).

I'm not sure I understand -- it sounds to me like Krugman was describing the fed strategy with obvious skepticism, not advocating it.

oh, my dear friends at GS.

http://www.scribd.com/doc/16750352/Goldman-Sachs

removed. what did it say?

nothing that matters!

is there a reason they won't put it online at rollingstone.com?

m. taibbi is my hero
http://trueslant.com/matttaibbi/2009/06/30/on-giving-goldman-a-chance/

Greider (pasted cuz it's behind sub wall):

Obama's False Reform

By William Greider

This article appeared in the July 13, 2009 edition of The Nation.

The most disturbing thing about Barack Obama's call for financial reform was the way the president falsified our predicament. He tried to make it sound as though everyone was implicated in the breakdown and therefore no one was really to blame. "A culture of irresponsibility took root, from Wall Street to Washington to Main Street," Obama asserted. "And a regulatory regime basically crafted in the wake of a twentieth-century economic crisis--the Great Depression--was overwhelmed by the speed, scope and sophistication of a twenty-first-century global economy."

That is not what happened, to put it charitably. The regulatory system was not overwhelmed by historic forces; it was systematically gutted and dismantled by the government at the behest of banking interests. If Obama wants details, he can consult his economic advisers--including Larry Summers and Tim Geithner--who participated directly in unwinding prudential rules and regulations. Cheers were led by the Federal Reserve, with heavy lifting by both political parties.

If Obama were to tell the truth now about what went wrong, he would face a far larger problem trying to clean up the mess. Instead, he has opted for smooth talk and fuzzy reforms that in effect evade the nasty complexities of our situation. He might get away with this in the short run--Congress doesn't much want to face the music either. But Obama's so-called reform is "kicking the can down the road," as he likes to say about other problems. In the long run, it will haunt the country, because it fails to confront the true nature of the disorders.

Giving more power to the Federal Reserve to be the über-regulator of banking and finance is a terrible idea. Asking the cloistered central bank to resolve all the explosive questions about the overreaching power of financial institutions is like throwing the problem into a black box and closing the lid. That's the reason Wall Street's leading firms first proposed the Fed as super-cop, then sold it to George W. Bush and now Obama. Give the mess to the Wizard of Oz, the guy behind the curtain. This constitutes the high politics of evasion.

Still, a nascent rebellion is gathering strength in Congress. Some 240 House members have endorsed a measure to force auditing of the Fed by the Government Accountability Office--a small but vital step toward dismantling the central bank's privileged secrecy and intimidating mystique.

As someone who has been around this subject for three decades, I have come to understand that the power of financial titans and their friends at the Fed depends crucially on public ignorance. Most legislators are just as clueless as their constituents. If they knew more about how the system works, they would see that most of Obama's reforms are insubstantial gestures, not actual remedies. The president, for instance, proposes to raise the requirements for capital and liquidity held by commercial banks with strict limits on leverage. That is a virtuous proposal, but it leaves unanswered the question, Why did the legal limits already in place fail to restrain bankers' appetites? Indeed, several times in the past two decades the Fed and other central banks enacted new and supposedly more effective capital requirements. The big dogs of banking broke free of the leash again and again, while vigilant watchdogs at the Fed and elsewhere looked the other way. Why should we expect different results next time?

One reason the old restraints failed is the "modernization" that shifted credit functions outside regulated banks and into a variety of unregulated money pots--the so-called shadow banking system of hedge funds and private-equity firms. These interact intimately with traditional banks and give them profitable ways to evade rules or conceal the condition of balance sheets from regulators and investors. These interactions are dazzlingly complex, but this was not an accident. It was the goal of financial deregulation enacted by Bill Clinton, arm in arm with the GOP Congress.

Summers and Geithner suggest that shadowy outfits like GE Capital or major insurance companies can be regulated by the Fed as "Tier 1 Financial Holding Companies." As Joe Nocera recently noted in the New York Times, "Tier 1" sounds like the new name for "too big to fail." The Fed will watch them (we are assured) to prevent "systemic risk." But that is what the Fed should be doing already as the lender of last resort charged with defending the "safety and soundness" of the banking system. The Securities and Exchange Commission, likewise, is supposed to monitor hedge funds and private-equity firms, which thrive on secrecy. Since the SEC failed miserably to police regular corporations, this does not sound reassuring.

Another example of extremely wishful thinking is the proposed rule on securitization of mortgages. The method of bundling home mortgages and turning them into salable bonds was supposed to reduce risk; it did the opposite. The mortgage lenders were able to execute dubious, even fraudulent, loans, collect profits upfront and then sell the package to unwitting investors. Obama's answer is to require the originating lender to retain a 5 percent interest in the mortgage and pass on the rest. That seems ludicrous and innocent of how that cutthroat world works. The financial geniuses who created the subprime scandal could hide 5 percent of the mortgage value with a couple of keystrokes--adding fees, closing costs or other dodges. To really hold lenders responsible, they should be made to hold on to something like 50 percent of liability for the original loan, with perhaps the other 50 percent assigned to whatever bank or investment house packages the mortgage security and sells it to financial markets. That would be "responsibility" with old-fashioned force.

The one bright spot in Obama's plan is the new regulatory agency he recommends to protect consumers of financial products. This was inspired by Elizabeth Warren, the Harvard professor who has been a brave and brilliant critic of the credit card industry and other forms of predatory rip-offs. While it depends entirely on the details, this innovative agency could become the new tiger among tired, toothless regulators--especially if Obama has the courage to name Warren as the inaugural chair. The bankers hate this idea and will fight to kill it. They know this regulator will not be captive to them, at least not yet.

The essence of what's missing in the Obama plan is hard rules. Drawing up concrete prohibitions and commandments is obviously a tougher challenge, because it requires deep understanding of the financial system. You cannot design far-reaching reforms until you understand what led to the breakdown. Since the government has avoided that kind of serious examination, it assigns these explosive issues over to expert regulators--the same experts who failed to see the trouble coming.

Right now, the imperative should be to slow down the rush to weak solutions. Congress would do well to drag its feet while it conducts deeper investigations. A promising new commission has been authorized to investigate the crisis, along the lines of the one run by Ferdinand Pecora in the 1930s, which investigated the causes of the 1929 crash. Let's hope it is not stocked with bank lobbyists. Meanwhile, give subpoena power to Elizabeth Warren and the Congressional Oversight Panel she chairs. Hire some independent investigative reporters eager to dig deeper into the mulch. What exactly went wrong? Who has bloody hands? What fundamental reforms are needed? If the economy returns to "normal" soon, the ardor for serious reform might dissipate. That is a small risk to take, especially if the alternative is enacting the bankers' pallid version of reform.

http://blogs.wsj.com/economics/2009/07/02/broader-unemployment-rate-hit-165-in-june/

http://obsidianwings.blogs.com/obsidian_wings/2009/07/the-optics-are-bad.html

"The Optics Are Bad"

by hilzoy
From the NYT:

"Banks and mortgage lenders are placing top priority on killing President Obama's proposal to create a new consumer protection agency that would regulate home loans, credit card fees, payday loans and other forms of consumer finance.

The Obama administration fired an opening shot on Tuesday, sending Congress a detailed, 150-page proposal for an agency that would set new standards for ordinary mortgages, restrict or prohibit risky loans, investigate financial institutions and enforce new laws aimed at protecting credit card customers.

"This agency will have only one mission -- to protect consumers," said Timothy F. Geithner, the Treasury secretary, in a written statement on Tuesday.

But industry executives vowed on Tuesday to fight Mr. Obama's plan with everything they have, even though banks are still heavily dependent on many taxpayer-supported loans and loan guarantees to get through the crisis. (...)

Bank executives said they knew they faced a difficult political fight, given the soaring number of homeowners facing foreclosure.

"We know the optics are bad," said Scott Talbott, vice president for government affairs for the Financial Services Roundtable, a trade association in Washington. "If you are against a consumer regulatory agency, then everybody will say you're against consumer regulation.""

I suppose that when your industry has come up with such gems as the liar loan, helped bring the entire financial system to the brink of ruin, and helped bankrupt not just the people who took out those loans but people who had nothing to do with them -- people were laid off because of the crisis you helped create -- and when, after all that, you decide to oppose regulation of consumer financial products, you might say that "the optics are bad".

Here's some more bad optics:

"Gabby Ornelas, a former teller at the giant Bank of America Corp., remembers the training sessions. And she remembers her marching orders: "Sell, sell, sell."

Ornelas was instructed to use her Spanish language skills and Latina heritage to sign up customers for as many kinds of banking services as possible, she said -- services that led to lucrative fees for the bank and financial entanglement for many customers.

"We were coached every day to push multiple checking accounts, credit cards and debit cards even when the customer didn't understand how to use them," said Ornelas, who lives in Landover Hills, Md., a town with a large immigrant population and a per-capita income of less than $19,000.

In one case, she described a Central American mother of three who came back to see her at the bank, distressed about $300 in overdraft fees incurred after Ornelas persuaded the woman to open a second checking account. (...)

The former workers said they were going public to lay out what they saw as a little-known side of BofA's business model: encouraging working-class customers to sign up for high-interest-rate credit and cash advance services and structuring an array of check and debit card services to maximize overdraft fees and other charges."

I can see why people who engage in those kinds of practices -- or these, or these -- might be leery of a consumer protection agency. What I can't see is why the rest of us should listen to them. They had their shot at policing themselves. If they wanted to avoid regulation, they should have taken it. They didn't. To my mind, they have long since forfeited the right to complain.

When I heard about last week's bill that was 1300+ pages I thought of the same thing I am thinking of after reading those posts, and its that scene in Brazil where all that paperwork explodes the duct system and Tuttle gets swallowed in it.

taibbi's latest article is fucking awesome
http://www.rollingstone.com/politics/story/28816321/the_great_american_bubble_machine

(and thanks good dr. morbius for the greider article -- only got to look at the first few paragraphs cuz i don't have a subscription)

Goldman Sachs reports record profits. Hooray!

No one has ever made me want to bury my head in the sand quite like Taibbi. Really knows how to make you feel depressed and helpless.

Radio was talking about the market being up because 'banks' were doing better. No dude, its bank. Singular. One bank. One shady ass bank.

From Taibbi's article:

"...the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain... "

I'm a bit perplexed by the singular fixation on Goldman Sachs -- how were they different from any other investment firm that contributed to the current mess? Also, if anything, isn't their current success partly due to the fact that they were wise enough to limit their exposure to the risky mortgages before everyone else?

I mean I find writing like this a little o_0, especially when you're using it in conjunction with the word "Goldmanite" over and over again:

The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.

Such vivid imagery in that description imo.

Goldman Sachs is definitely the place my physics PhD peers were most excited to get a job at a couple of years back.

It just sounds a little too much like certain highly recognizable nazi propaganda that I'm not going to GIS right now for work reasons. And I genuinely don't understand why Goldman Sachs is the nexus, as though the misdeeds of Citigroup and Merrill Lynch, for example, are due not to their own flaws but rather to the fact that their executives used to work at Goldman.

http://octoprop.files.wordpress.com/2009/02/labastille-lapieuvre.jpg

vampire octopus they play their money games so real

I kinda look like that octopus tbh.

Too much hair oil, Charlie.

I'm a bit perplexed by the singular fixation on Goldman Sachs -- how were they different from any other investment firm that contributed to the current mess?

http://mhpbooks.com/mobylives/wp-content/uploads/2009/03/paulson.jpg