You are currently browsing the category archive for the ‘Irving Berlin’ category.
Duffy is God’s answer to a prayer.. I miss the old days of blogging when we were debating principals instead of people… Duffy has stuck to the old line of debating principals with facts, and that is what makes him special in the eyes of bloggers everywhere…
Since the passing of Steve Newton, he has been the only one to challenge me in any argument, and usually some pretty good stuff comes out of both sides during the exchange… I have respected that.. Cause once again, opinions mean dick. Facts are what we steer by.. It is my hope that in responding to his challenge that an answer may make itself apparent.. Who knows? It may not come from me… But if I’m the catalyst for bringing it out in the open, then… none of this was in vain..
Why I like to debate Duffy is simple.. Neither side, he or I, is concretely set in their opinions… We accept it when the other side makes sense… I usually go into such debates having no idea where they’ll end up… I hope the rest of you enjoy the ride as welI….
Duffy leads: Wall Street’s problems were caused by Fannie and Freddie loaning money to people they knew couldn’t pay and moreover, forcing banks to lend money to people who couldn’t pay. That was not deregulation but misregulation
kavips rebutt’s:Uh… Mr. President. That’s not entirely accurate.
First off, the Community Reinvestment Act of 1977 was developed for, and locked in on, urban developmental areas and had no part of the subprime boom, which primarily occurred out in western desert regions where owning 4 to 5 investment homes was normal… Those homes were overwhelmingly funded by loan originators NOT SUBJECT to the act… We all know the crises was not because people couldn’t afford a payment on their house. It came about, because with no occupants, people could not afford the payments of 4 to 5 houses….. Instead of one loan per borrower turning up in default; four to five were.
Second off, The housing bubble reached its point of maximum inflation in 2005.
Courtesy of NYT
Third off, During those exact same years, Fannie and Freddie were sidelined by Congressional pressure, and saw a sharp drop in their share of loans secured by the Feds… Follow the dotted line on the very bottom of the graph…
Courtesy of NYT
Fourth off; During those exact same years, private secures, like Delaware’s own AIG, grabbed the lions share of the market.
Courtesy of NYT
Remember these graphs for later on when I discuss the results of deregulation, versus regulation… But like it or not, these graphs conclusively show that private insurers, who thanks to Marie Evans, we now know were deregulated by Phil Gramm in the 2000 Omnibus Bill, were the primary cause of the worlds financial collapse.. Probably put best by these words of AIG’s spokesperson, who when asked why they didn’t have sufficient funds to cover losses, said point blank, “We were deregulated. We were no laws requiring us to keep any funds, ..so we spent it…”
Duffy leads: The loosely regulated hedge funds escaped this mess largely unscathed. Why? They can’t count on a bailout like the big banks. The Too Big To Fail banks were counting on a bailout (not unlike the S&L bailouts which started on the Republican’s watch) and they got them.
kavips rebutt’s:Uh… Mr. President. That’s not entirely accurate. I agree that the hedge funds did survive better than the banks. Not because of bailouts, but because they sold short during the crises and made billions while firms closed and people got thrown out of work. There is nothing wrong with that; I did the same. In fact close readers may remember my warnings that the crises was impending almost a year earlier. Very close readers may remember my telling them exactly when to sell, and at what point the stock market would rebound… I must say: I called it rather well.
“Hedge funds were not in my understanding, at fault in the credit crisis,” said David Ruder, former chairman of the Securities and Exchange Commission. “At the most what they did was to sell securities when some of their investments were declining and they needed to have liquid funds. They were not the architects of these problems.”
De regulated hedge funds are not the issue… De-regulated, excessively leveraged, mortgage securities, are a different story however… They, not the banks that held them, are the cause of the crises…Years from now, when academics search for causes of the stock market crash of 2008, they will focus on the pivotal role of mortgage-backed securities. These exotic financial instruments allowed a downturn in U.S. home prices to morph into a contagion that brought down Bear Stearns a year ago this month – and more recently have brought the global banking system to its knees.
Where you err is when you state that banks too big to fail, assumed they would be bailed out… By implication, you say imply they failed from squandering money, and wanted the bailouts.. But your tax dollars didn’t flow directly to the bottom line.
The roughly $200 billion the Treasury Department has handed out to battered banks was swapped for a special class of stock that pays a 5 percent dividend (rising to 9 percent after five years.) As of April 15, the Treasury had collected about $2.5 billion in dividend payments on its investment.
So in that sense, the bailout money represents an expense for banks. That’s one reason a number of banks have said they want to give the money back as soon as possible.
You say big banks were counting on a bailout, and they got them? That didn’t happen to these banks. New Mexico, Georgia, and Florida each lost a bank just last Friday. That brings to 8, the number of banks failed in June. Unfortunately if a bank is failing, it can’t bet on itself to fail, as can a hedge fund.
Duffy leads: Banks have successfully lobbied to get their losses absorbed by taxpayers and gains are kept private. How nice for them. They felt comfortable making insane gambles because they knew they’d be bailed out. Most of them were right. Also remember that it was Bill Clinton who tore down the wall between retail and investment banking. The idea was to give banks more stability as they typically perform as exact opposites in bull and bear markets. (FWIW, I think that was a good idea and I can tell you first hand that two of the Fortune 100 banks I worked for were carried by retail banking in bear years. They may not have had bonuses those years but they didn’t have layoffs either)
kavips rebutt’s:Uh… Mr. President. That’s not entirely accurate. The idea is that the banks made bad decisions knowing taxpayers would bail them out is the issue that is inaccurate. For the record, I have no qualms that it was the Clinton legacy who tore down the wall between banks and investment banking. Like you, I feel it was a good idea to do so… Again the problem was not primarily with banks making loans to people who could not pay.. Although, it was as late as October 2009, when I was made aware of one private Bank in Denver still exaggerating income to make loans look good enough on paper to get approval of securitization. What caused the collapse was the leveraging of those loans as securities, so that as the housing market became overextended, and the ARM jumped past the low cost opening years, the damage was 100 times worse because of leveraging. What made the collapse criminal, was that the insurance most financial institutions had bought from AIG, to cover such an improbable event, had already spent by that companies executives, out on bonuses to themselves. What made it doubly criminal, was that when they received government dollars through a taxpayer bailout, those same executives assumed it was to first go towards paying their bonuses again. However, very recent events may give some cover to the argument that some collusion was implicit in the bailing out of Goldman Sacs and AIG… Basically, once bailed out, AIG paid Goldman Sacs for shares twice as much as they were worth. The documents also indicate that regulators ignored recommendations from their own advisers to force the banks to accept losses on their A.I.G. deals and instead paid the banks in full for the contracts.
This is a guessing game. It’s supposed to be fun. You do the guessing. I’ll reveal the answer at some point in the future. Bottom line, I am interested in how this plays out. (To keep answers out of moderation, no links please.) You may use the categories above for some helpful hints, but knowing me, don’t expect to find the answer that easily.)
1) Foreign policy/defense: I want American imperialism rolled back and American interventionism halted, as the same time we begin to pull free from the military/industrial complex by slashing the budgets for defense and homeland security to reasonable levels.
2) Civil libertarian issues: I want to see gay marriage legalized; drugs decriminalized; Real ID abolished; the Patriot Act gutted; and immigrants viewed as human beings. I want intrusive government the hell out of my life.
3) Fiscal sanity: I want a government that stops growing and taking an ever-expanding bite out of my paycheck; I want to see wasteful programs cut, and to have Congress faced with the same sort of imperative the Delaware General Assembly had to face this year: balancing the budget.
The economy is a behemoth. How and in which way will you define such a broad term as the economy?
What tools will you use to determine if it is moving up or down. Stock markets are often used as a peg . But if only the wealthy participate, it is a poor device for measuring the well being of those who’s budgets are too stretched to participate. Poverty levels are also an indicator that measures how our lower class is doing, but does nothing for measuring the amounts needed to invest in growing businesses.
Whatever measure we choose, needs to be standardized, allowing both the growth of capital and the well being of Americans. An example of policy gone wrong is this. If you cut taxes and that cut leads to increased medical costs, energy costs, and raises the cost of insurance, so that citizens are paying out of pocket much more than they were before, that policy is not as helpful as it may seem at first glance.
There needs to be a way of measuring the well being of Americans. Setting a standard as having a place to live, two cars, taxes, insurance, enough to cover both energy costs and communication costs, would be a good indicator for someone in my age bracket. To someone older, adding medical costs might be considered. The income left following the deduction of these expenses, would measure the well being of America. A certain number of people would have incomes above this line, and others would find themselves below this line. This measure would go up and down as the economy rose and fell, and this measure would be an appropriate indicator. If energy prices spike, elected officials need to react. But if energy goes up, and say insurance rates go down, it would not have to move so readily.
Effective politics would achieve growth along this line. As more citizens increased their disposable incomes after necessary expenses were met, that would be a positive indicator reflecting a growing economy.
It would drive home the argument that all of us are threads in a tapestry. Each of has a responsibility to ourselves and immediate family, but our actions also have repercussions far removed from us locally due to the increasing complexity of today’s world.
This opens the door to a new way of looking at old problems. If paying more insurance, is offset by a matching reduction in taxes, then no one is worse off. And if paying more in taxes result in paying even less in energy costs , no one is worse off.
Fortunately due to the massive scale of the United States, the economies of scale have merit here. Just as Wal*Mart buys items at a lower cost than those mom and pop stores it puts out of business, the government can use economies of scale to do the same. It is far less costly to pay one contractor to build ten miles of road, than pay ten contractors to build one mile each. Thus if used properly, taxes can be a good thing. Like a growing government contract, they can pool resources and bring prices down by sheer numbers.
Especially in the medical field is this appropriate. If one pays less in taxes, and thus pays far more for prescriptions, he may be happy for a moment until he considers the reverse option, of investing in his taxes to drive down prescriptions and make them far less expensive. Whether this is a success or failure, is decided by whether that citizen’s finances are better off.
The cumulative effort of all individuals, determines whether this nation should keep or scrap a policy.. Ideology of grand sweeping ideas, of say “Big government versus. Small government:” should have little to do with policy. Does it work or not work; that is the question for which a majority of Americans need the answers.
Across this generation saving levels have dropped. Americans seem to be more secure in their future and would rather spend on “now” than save for tomorrow where truthfully, that money will probably go to someone else: a hospital, nursing home, etc, etc…..The brilliance of the Clinton economy was that costs were held low for what ever reason across the board, thereby freeing up excess money for more goods and services.
Pulled this comment out from a response to Mike’s Merit Bound Alley, regarding the War on Drugs. I’ve noticed this topic, particularly Mandatory Drug Sentencing , has been getting attention lately. Below is the comment. My apologies to those who have seen it before.
I have been working on this problem for a while.
The solution came to me in a Wal*mart. To keep myself from falling asleep while shopping with my wife, i challenged myself to think through our drug policy and find a workable solution.
For some reason I decided to look around and create a thought model that said, what if everything here was a recreational drug, how would that work……….
Simply put. ( the real argument is much fuller) Q & A style.
Q: Drugs are addictive. Addicts MUST have it
A: So is food. We don’t kill for it.
Q: Would you kill for food if someone was preventing you from getting it?
A: Hell yes.
Q: Drugs are bad. They distort reality.
A: So does mixing alcohol and television. But we survive.
Q: What is the fastest way to stop smuggling.
A: Take away the profit from it.
Q: How can one do that?
A. Put the government in control of selling drugs below cost.
Q: How would that help?
A: Which would you prefer, driving down to Market and 25th and buying from some hooded undesirable, or standing forever at a Wal*mart checkout line?
Q. That’s crazy. You would sell crack, coke, heroin, weed in a store?
A. Not only that, we would sell it for CHEAP
Q Then everyone would be an addict.
A. Does everyone sniff glue? It’s cheap. Does everyone inhale hairspray? it’s cheap. Does everyone smoke banana peels? They are not expensive. Price or accessibility are not the reasons fewer people use drugs.
Q. What about those who become addicted…….
A. That will be part of the social cost, funded by taxes. They want treated, we treat them.
Q Drugs will weaken our society.
A And alcohol won’t.? Man has survived on alcohol since the original drink. Society still functions. Many today survive on illegal substances. Their lives, jobs, reputations are not in jeopardy.
Q if drugs are free, why would someone work………Just lay around and have someone bring you food, clean you up, sort of like Tennyson’s “Lotus Eaters.”
A. Currently the one’s who lay around and get high, are the ones without jobs or responsibilities. Those with responsibilities still use drugs, but impose their own restraints. “No, I got to work tomorrow.”
Q: What makes you so sure that society will not collapse if the government sponsors drugs real cheaply.
A. Suppose I overdo it and one day get fired. I’m a loser. But everyone else who sees me get fired, tells themselves they need to keep their habits under control. Society will survive because someone will always be there to replace a loser
Q. Drugs are bad for health.
A And tobacco isn’t. This is America.
Q You must use drugs to want to legalize them so much?
A. No, they scare me. My gut emotional response is to keep doing what we have been doing. Keep them out. This is a thought process designed at solving a problem using a series of models and predicting the outcomes.
Q So you are ignorant of the effect that drugs have on people since you abstain from them?
A. I am the last real person in “Invasion of the Body Snatchers” Everyone else uses drugs in society but me, and I have to accept it and fit in to survive. (Excuse me, I have to go check out that discordant shrieking noise outside……….)
Q How will this plan stop violence, smuggling, murders, police corruption currently associated with drugs?
A. Imagine you own a cartel and have 3 Billion dollars tied up in drugs. The next day and forever more you can’t sell it for a penny……How do you pay off the cops, how do you pay your thugs, how do you pay your runners, how do you pay your assassins? More likely they will turn and come after you.when they realize you cannot pay them.
Q: How much would this cost.
A Much less than we are spending now.on prevention.
Q What bothers you most about this idea.
A It is too conservative for it uses the market place to solve a social problem. And that scares the hell out of me…………………
Early this morning snow fell on Delaware. It was nothing like the blizzards of the Midwest or the lake snows blanketing the state of New York. In fact, it was not much of anything really.
That is perhaps why of all the things going on in the world today, I decided to ignore them for a moment and revel in this immediate event that happened here tonight.
Snow has been rare this winter. I can think of no school closings so far. First time ever, my children tell me. And this snow, had it been on a steep slope, would have been awesome for waxed skis.
But what I like best, is that this event sort of sneaked up on us. Oh usually, the salt is thickly spread long before the first tiny flake falls, leaving a safe, if not ugly black ribbon cutting across the fresh white packaging.
But this time, Deldot was sleeping, and fortunately for me, they had not destroyed the silence of tredded rubber slicing through pristine powder. No groan of the window-washer pump, no clatter of squeaky wipers to spoil the silence; no sizzle of filthy water flung up against my fenders; just the whisper of the flakes blowing off the roof, leaving a different kind of vapor trail in my wake.
There is nothing like the quietness of falling snow. Distant sounds, if heard at all, have a strange tone when snow is falling. It is like hearing for the first time, a distant echo from our brief beginning.
After a long time, finally now, I could be at ease. There was quiet. There was a peace that has escaped me since childhood. For everyone else was asleep. It was exhilarating to drive down America’s aorta, with no tracks in front of me, following my same nightly routine, but with none of the same consequences.
I know most of you will wake, perhaps shocked, and contend with Deldot’s rapid response team. You will curse and swear and hopefully avoid any financial detriment caused by those flakes of white.
As for me, I hope to catalogue, bury, and hold on to the memories of this night forever. And at some later date, recover them and rejoice that one still has the ability to remember how a child feels, especially when those tiny white flakes start to fall.
But being grown up, like Ulysses I am tied fast to my responsibilities and routines, and though I cry out to the snow siren that sings it’s songs of my youth, my ship moves on, and only faint memories of what transpired tonight, will linger on.