Tuesday, October 7, 2008
My dream job is to be a headline writer for a London tabloid! Think of the sheer happiness in the heart of the guy who typed that one up! Meanwhile Mr. Gay USA, Barney Frank, has done the same to the US banking industry without any corresponding headlines and has handed us a hefty bill for his gourmet treatment of the economy. The weird thing about all this is that the whole world 'packaged' these worthless mortgages and sold them all over the planet. Foreign markets are crumbling because they were stuffed with 'assets' based on loans given to people who were collecting unemployment insurance and Food Stamps. Those bankers might as well have been buying and trading and investing in piles of old newspapers.
The real estate panic has spread to Europe. The true assets of most smaller and regional banks are in the negative because of a weird self-fulfilling psychological twist; if you think every thing is worth less then it is. The same fantasy that ascribed value to worthless paper is now denying value to real assets. Not everyone was so overleveraged that they are on the verge of bankruptcy.
A lot of this bundled garbage was dumped on our friends in the oil export biz. Now with oil prices half of what they were six months ago and headed down our erstwhile desert allies are standing knee-deep in unsold oil clutching their worthless bundled mortgages and wondering why they've gone from being on top of the world to deep crisis in such a short time. As the oil price sinks toward $40 a barrel what are Putin and Chavez going to do? Both of them kicked out the hated foreign (i.e. efficient) oil companies and now they are entering a price war with their former OPEC buddies with declining output and crumbling infrastructures. With investment having fled from Russian markets because of Putin's stupid aggression in the Caucasus their only source of income looks like it will be cut by 60-70%. Part of the reason that the real estate markets crashed was because of the spike in energy prices engineered by these greedy thugs who didn't realize that Globalization means we're all in the same boat. Self-serving, anti-market behavior devalued their own assets when the crisis finally arrived.
So now Barney Frank, one of the chief authors of this disaster is accusing the critics of the Community Reinvestment Act of being racists. Those are the the herbs in which Gourmet Democrats are stewing the lies about where the responsibility for all this rests. Gourmet Democrat policy for decades has been to lower requirements for mortgages in the name of the poor. Fannie Mae and Freddie Mac pumped hundreds of billions of dollars into the mortgage markets, effectively creating the entire bundled mortgage security market. That this was done as an altruistic enterprise to help the poor should be taken into account as these same geniuses try to 'fix' health care in the name of the poor.
Now Palin and McCain are out there hitting the Gourmet Democrats hard! It had to happen. It was their only choice. The Gourmet Democrats were thinking that they had successfully pinned this whole mess on the same hapless Republican chumps who have been laying down and taking it ever since Bill Clinton whipped them like a team of rented mules during his Impeachment Party. But things are different. We're not going to let them walk away from something this big. Clinton and Obama are up to their eyeballs in this current crisis and McCain and Bush tried to do something about it before it was too late. McCain has been forced by the stream of lies directed at him to attack Obama, who is wide open on this. There is a whole, noisy month to come and Nancy P's thin class warfare soup is not going to be very satisfying. ACORN better register a lot of wino's, felons, illegal aliens, cartoon characters, pets and Alzheimer's victims to make up for the large number of people who will abandon Obama and the Gourmet Democrats when the truth of this sinks in.