A good example of team work is how Clinton and Gates were able add to
your speech to surge in Afghanistan and propagate your message.
Clinton has a particularly difficult job (always walking on egg
shells), accepting your boxed in position (regional czars) yet hit the
ground running and performs at high energy levels. Rahm Emnual has
taken on the tough jobs and delivered. These are great team players
and don't nearly receive the gratitude they deserve.
The failure of teamwork by your economic sector has created a dismal
economy with dim prospects. No economic policy ever gets amplified.
Romer has an interview, Summers has an interview, Geithner mumbles and
things get sucked into a sink hole.
I never fail to remind you how Geithner fails you. In March, I
patiently waited for Geithner's solution to the securitized mortgage
crisis. I felt it was inadequate but rather than pan it, I made an
effort to provide an alternative. The Congressional Oversight Panel’s
year-end report concludes that “the foreclosure crisis continues to
grow,” and finds that “TARP’s foreclosure mitigation programs have not
yet achieved the scope, scale, and permanence necessary to address the
crisis.” Geithner failed.
Some consider housing as the backbone of the American economy. The
mortgage modification program has provided 10 revised mortgages. Reset
mortgages will continue to trigger for 17 more months. The number of
homes whose mortgage exceeds market value is sustainably high.
Unemployment contributes to more foreclosures. Your administration
has only provided band-aid fixes. You have never defined the problem
and this makes it difficult to arrive at a solution.
I proposed that property values be reset to market rates through a
task force of External Auditors. The mortgage lenders take the hit
for the amount of the mortgage in excess of the market value. The
home owner's equity portion in home ownership becomes fair. The
bubble was caused because certain owners were not required to make a
down payment, to establish a reasonable equity position and didn't
know their variable rate mortgages would escalate. It is
irresponsible to give hope to these people that they could re-finance
their mortgage.
The current stalemate is that the lenders (the Banks) have not taken
their loss and are unwilling to do so. The role of Government, to
ensure that property values fairly reflect market values and then
undertake the administrative paperwork to re-write home owners
mortgages based on this market price at whatever interest rate the
bank dictates. The banks are unwilling to provide the human resources
for such an undertaking. This is the perfect stimulus project. Create
a Mortgage Revision Bank that hires a lot of unemployed mortgage
officers and bank officials and does the administrative work for the
banks.
There is a real need for team wok in your Economic sector- amongst
themselves, with Congress and the electorate. They have failed at
teamwork. You have failed as coach, manager and owner. You need a
game plan, a set of plays to execute the plan and the bodies to
execute the plays. I sincerely feel that James Baker can make a
strong contribution because he is a team player, he gets along with
Congress and he's smart and willingly does the dirty work, a
diplomatic Rahm Emnual! Don't make him in charge, he was a disaster
as Secretary of Treasury, but he will make a big contribution
especially if Congress goes Republican. My hope is that he would
carry some of Emnual's workload.
Pundits compare your first year to Clinton and Reagan, unfavorable
polls with hostile Congress yet ending strong. Let me warn you that
you are looking a lot like Jimmy Carter, financial calamity, hostile
foreign affairs yet a really decent guy. Carter faced historic
inflation,...so will you! One day, the dollar will drop forcing
interest rates up and when it starts moving, there is no reason to
stop. I must admit, I don't know what I'm talking about. I've always
considered your greatest strength is your ability to counter-punch. I
haven't heard anything from you that counters my assertions.
I told you so.
PS
I know you are wary of group think and seek out divergent opinions. I
would suggest that you meet Elizabeth Warren and John Geanakoplos for
a two hour meeting. It will be worth your while.
Sunday, December 13, 2009
Monday, November 9, 2009
One year down, three to go
I can praise Rahm Emnual’s dedicated efforts for the stimulus package and healthcare and the teamwork of Robert Gates and Hilary Clinton (Defense thinks State should be bigger and get more money). These peoples’ hearts and yours and Axelrods’ are in the right place.
These good efforts have been undermined by your failure to mind the store and the economy has sunk. I never fail to remind you how Geither has failed you. In March, he never produced a plan to address the banking credit crisis. He gave away billions of dollars of Tarp money that ended up as Goldman Sachs bonus pay, yet the bad debts still remain on the bank books. You talk of taking more care to get out of Iraq than was taken to go to Iraq. Geithner said he was unprepared to think of exit strategies during Congressional hearings. Your failing is that you don’t have a clue as to the difficulty to extricate tax payer money from the bailouts Geithner dived into. When debating whether to bail out the car manufacturers, certain members of Congress asked, what assurances there are, that more bailouts won't be needed. Well GMAC came back and asked for more. Someone told me that your Grandmother was concerned that you if didn’t manage your money well, someone would take advantage of you. Her fears were well founded.
If you want to salvage your Presidency I would create a true economic recovery team. Bill Clinton, Alan Greenspan and James Baker. Each man brings a great talent, Clinton the vision, Greenspan the specifics and Baker the implementation). Sadly you bring nothing.
I perceive an intellectual smugness on your part (some would call it cockiness). If you think you can win in 2012 because the Republicans are divided, you may not see the surprise attack. I will be following the Michael Bloomberg candidacy for President. He can buy the Republican election machinery and appeal to enough Democrats, Republicans and Independents to wipe you out in 2012. He is truly purple. Frankly speaking, six words can wipe you out “The economy, stupid. Jobs, jobs jobs”.
If you see the light and concede that you are a lame duck, you could finish your days by doing the right things such as:
-eliminate farm subsidies. Farming is too fragile to be a naked open market. Build a farm marketing board that charges a 3% surtax on profitable farm income, but guarantees a break even selling price when market prices are below farmer’s costs. This board allocates quotas to define how much of a farmer’s output will be covered by the break even guarantee to prevent overreach by farmers.
-downsize the military budget. The military budget is filled with political payoffs that are not functional if not wasteful. Better to pay these people unemployment rates than the marked up rates.
-introduce election reform. Geithner gave AIG money that flowed through to Goldman Sachs, before the CDS were valued, because Goldman Sachs was the biggest contributor to the Democratic election campaign. Anti-trust suits against Goldman Sachs are not forth coming for the same reason. Fanny Mae should be forced onto Goldman Sachs and Freddy Mack forced onto J.P. Morgan Chase. You cannot do the right thing because your very election and re-election attempt are beholding to Goldman Sachs. Government fails the people. The same could not be said if Bloomberg wins in 2012, he could use the full force of the government to serve the people.
-for the energy independence dream, focus on the energy conservation stuff, kick this issue down the road.
-immigration reform is a dead issue in a recession that feels like a depression.
-my personal concern is the huge and growing gulf been the haves and have nots. The social unrest among the poor will explode into crime and then riots and cries for revolution. You worked this beat. My life experience tells me that oppression breeds a powerful revulsion. You seem so out of touch with main street (people who buy a loaf bread and gallon of milk) never mind the mean streets. This does not appear to be an issue for your administration.
These measures address serious problems with the deficit that most President’s can’t touch. You got a million from the Swedes, you could split some with Axelrod. I think President elect Bloomberg would hire back Emnual, Clinton and Gates and I know he would fire your 38 czars. Geithner will get hired by Goldman Sachs with the flow-through government money he gave AIG.
This bitter tone stems from the frustration that you must accept that this economic fiasco is of your doing, since you never intervened when the problems were pointed out to you along the way. I told you so.
These good efforts have been undermined by your failure to mind the store and the economy has sunk. I never fail to remind you how Geither has failed you. In March, he never produced a plan to address the banking credit crisis. He gave away billions of dollars of Tarp money that ended up as Goldman Sachs bonus pay, yet the bad debts still remain on the bank books. You talk of taking more care to get out of Iraq than was taken to go to Iraq. Geithner said he was unprepared to think of exit strategies during Congressional hearings. Your failing is that you don’t have a clue as to the difficulty to extricate tax payer money from the bailouts Geithner dived into. When debating whether to bail out the car manufacturers, certain members of Congress asked, what assurances there are, that more bailouts won't be needed. Well GMAC came back and asked for more. Someone told me that your Grandmother was concerned that you if didn’t manage your money well, someone would take advantage of you. Her fears were well founded.
If you want to salvage your Presidency I would create a true economic recovery team. Bill Clinton, Alan Greenspan and James Baker. Each man brings a great talent, Clinton the vision, Greenspan the specifics and Baker the implementation). Sadly you bring nothing.
I perceive an intellectual smugness on your part (some would call it cockiness). If you think you can win in 2012 because the Republicans are divided, you may not see the surprise attack. I will be following the Michael Bloomberg candidacy for President. He can buy the Republican election machinery and appeal to enough Democrats, Republicans and Independents to wipe you out in 2012. He is truly purple. Frankly speaking, six words can wipe you out “The economy, stupid. Jobs, jobs jobs”.
If you see the light and concede that you are a lame duck, you could finish your days by doing the right things such as:
-eliminate farm subsidies. Farming is too fragile to be a naked open market. Build a farm marketing board that charges a 3% surtax on profitable farm income, but guarantees a break even selling price when market prices are below farmer’s costs. This board allocates quotas to define how much of a farmer’s output will be covered by the break even guarantee to prevent overreach by farmers.
-downsize the military budget. The military budget is filled with political payoffs that are not functional if not wasteful. Better to pay these people unemployment rates than the marked up rates.
-introduce election reform. Geithner gave AIG money that flowed through to Goldman Sachs, before the CDS were valued, because Goldman Sachs was the biggest contributor to the Democratic election campaign. Anti-trust suits against Goldman Sachs are not forth coming for the same reason. Fanny Mae should be forced onto Goldman Sachs and Freddy Mack forced onto J.P. Morgan Chase. You cannot do the right thing because your very election and re-election attempt are beholding to Goldman Sachs. Government fails the people. The same could not be said if Bloomberg wins in 2012, he could use the full force of the government to serve the people.
-for the energy independence dream, focus on the energy conservation stuff, kick this issue down the road.
-immigration reform is a dead issue in a recession that feels like a depression.
-my personal concern is the huge and growing gulf been the haves and have nots. The social unrest among the poor will explode into crime and then riots and cries for revolution. You worked this beat. My life experience tells me that oppression breeds a powerful revulsion. You seem so out of touch with main street (people who buy a loaf bread and gallon of milk) never mind the mean streets. This does not appear to be an issue for your administration.
These measures address serious problems with the deficit that most President’s can’t touch. You got a million from the Swedes, you could split some with Axelrod. I think President elect Bloomberg would hire back Emnual, Clinton and Gates and I know he would fire your 38 czars. Geithner will get hired by Goldman Sachs with the flow-through government money he gave AIG.
This bitter tone stems from the frustration that you must accept that this economic fiasco is of your doing, since you never intervened when the problems were pointed out to you along the way. I told you so.
Monday, November 2, 2009
Empathy
Rahm Emnual, the noble statesman, picks his spots and fights the truly
worthy battles, the stimulus package and healthcare. His next
assignment should be to battle the national debt. Let him make
government more efficient, cut the waste and reign in uncontrolled
treasury excesses.
Your sense of government is troubling. There are 38 czars! You
required empathy in the Supreme Court nomination yet created a void of
empathy in the economic branch. Your economic teams operate with the
impunity of George Bush’s Defense Department invading Iraq. PBS makes
them out to be the Robert Rubin’s cabal.
I never fail to remind you how poorly Geithner is doing. He operates
like a czar, yet his sole supporter is you! He has no support in
Congress, among White House staff or the public. His plan to address
the credit crisis at the banks has not worked (I offered a timely
constructive alternative). The investment market place is not headed
to the sound foundations that you promised. A wage czar over the
private sector is an absurd sense of government. Turn your wage czar
on the government especially the military and the empire of czars.
You should be privately vetting candidates to replace Geithner
I think an empathetic White House would not ignore the plight, for human
dignity, of a person who is unemployed but is willing to work. You
are ignoring human suffering, the rising cost of the necessities of
life is not an arcane economic term “the cost of living” but the cost
of surviving! Like many successful people, you deny your past when
your mother was on food stamps. America is more than surviving, it can
afford to embrace human dignity.
You need an economic plan for main street.
Let’s do something to get American kids to exercise. In-line skating
and bicycling are great activities that can even save gas. So public
works for bike and skate lanes would be good. Ice skating is a great
activity and the rinks can be used as in-line skate rinks in summer so
build some ice rinks. This idea is so good even your daughters can
get excited about it.
Basketball is also great, church and school gyms should be modified to
allow public access after school hours.
How do you finance the rinks and gyms? Partner them with Starbucks,
McDonalds, Burger King and Wendy’s. Rinks and gyms could be operated
by chains. You have to work on laws to address litigation for
personal injury because unfortunately these activities can break
bones. A screwed up society has made skating, biking and pick-up
basketball legally unappealing.
Mass transit is important for main street. Have a plan where
companies gain when they subsidize or pay for bus lines that service
their street so their employees use the bus to get to work. Encourage
companies to work with public transit to make it worthwhile to involve
public transit to transport employees.
Public works, that help Americans change the way they eat, would be
healthy. Greenhouses built on the roofs of government buildings.
Grow tomatoes, lettuce, cucumbers and strawberries. Use pubic lands
for urban farms. This was done in the thirties.
There is a real loss of sense of government. The big financial
companies can bully the government because government isn’t strong
enough to enforce laws like anti-trust. Government has spent the
people’s money bailing out failed companies not hard working people
who may become unemployed or lose their house. Government, at
30,000 feet, says there is no inflation but when you live on the ground, the
cost of surviving has increased while income has declined. The future
is bleak because of the national debt and unemployment. You talk as
if unemployment is some kind of economic term, ever think that in
three years you could be unemployed?
worthy battles, the stimulus package and healthcare. His next
assignment should be to battle the national debt. Let him make
government more efficient, cut the waste and reign in uncontrolled
treasury excesses.
Your sense of government is troubling. There are 38 czars! You
required empathy in the Supreme Court nomination yet created a void of
empathy in the economic branch. Your economic teams operate with the
impunity of George Bush’s Defense Department invading Iraq. PBS makes
them out to be the Robert Rubin’s cabal.
I never fail to remind you how poorly Geithner is doing. He operates
like a czar, yet his sole supporter is you! He has no support in
Congress, among White House staff or the public. His plan to address
the credit crisis at the banks has not worked (I offered a timely
constructive alternative). The investment market place is not headed
to the sound foundations that you promised. A wage czar over the
private sector is an absurd sense of government. Turn your wage czar
on the government especially the military and the empire of czars.
You should be privately vetting candidates to replace Geithner
I think an empathetic White House would not ignore the plight, for human
dignity, of a person who is unemployed but is willing to work. You
are ignoring human suffering, the rising cost of the necessities of
life is not an arcane economic term “the cost of living” but the cost
of surviving! Like many successful people, you deny your past when
your mother was on food stamps. America is more than surviving, it can
afford to embrace human dignity.
You need an economic plan for main street.
Let’s do something to get American kids to exercise. In-line skating
and bicycling are great activities that can even save gas. So public
works for bike and skate lanes would be good. Ice skating is a great
activity and the rinks can be used as in-line skate rinks in summer so
build some ice rinks. This idea is so good even your daughters can
get excited about it.
Basketball is also great, church and school gyms should be modified to
allow public access after school hours.
How do you finance the rinks and gyms? Partner them with Starbucks,
McDonalds, Burger King and Wendy’s. Rinks and gyms could be operated
by chains. You have to work on laws to address litigation for
personal injury because unfortunately these activities can break
bones. A screwed up society has made skating, biking and pick-up
basketball legally unappealing.
Mass transit is important for main street. Have a plan where
companies gain when they subsidize or pay for bus lines that service
their street so their employees use the bus to get to work. Encourage
companies to work with public transit to make it worthwhile to involve
public transit to transport employees.
Public works, that help Americans change the way they eat, would be
healthy. Greenhouses built on the roofs of government buildings.
Grow tomatoes, lettuce, cucumbers and strawberries. Use pubic lands
for urban farms. This was done in the thirties.
There is a real loss of sense of government. The big financial
companies can bully the government because government isn’t strong
enough to enforce laws like anti-trust. Government has spent the
people’s money bailing out failed companies not hard working people
who may become unemployed or lose their house. Government, at
30,000 feet, says there is no inflation but when you live on the ground, the
cost of surviving has increased while income has declined. The future
is bleak because of the national debt and unemployment. You talk as
if unemployment is some kind of economic term, ever think that in
three years you could be unemployed?
Wednesday, September 16, 2009
How's my driving
Dear President Obama
On the anniversary of the Lehnman Brother bankruptcy, a wealth manager
of 2 billion dollars was asked what the government should have done.
He gave a version of my suggestion, to calculate the fair market value
of the securitized mortgages which I had sent you in March.
For me the sense of justice is missing in your administration. I
believed the change your campaign advocated was for a just society.
The rich bankers on Wall Street gambled and lost but Geithner lined
their pockets. My proposal of calculating the fair market value of
securitized mortgages and booking the loss to the banks is justice.
There was no justice, the tax payers paid for the banker’s losses.
I told you the sugar beet and corn (for fructose) farmers control the
market of sweeteners in the US economy and get subsidies. Dairy
farmers don’t have the same benefits. Milk is outpriced to the
fructose laced drinks and dairy families are forced out of business.
This is unjust, yet your administration has done nothing. Your
economic team reports no inflation because they exclude food and gas.
For me the cost of bread and milk has doubled, what’s the point of
saying there is no inflation? I feel it unjust that you don’t know
anyone who can tell you the price of a loaf of bread and a gallon of
milk.
Some companies paint on their trucks a sign that says “How’s my
driving? Call ….”
Every driver, you included, thinks he drives just fine. As an outside
observer, I’d like to suggest that you have blind spots in your
command of economics. You are deferring to your advisors. You lack
the background to know a good idea when handed to you. My suggestion
is that you privately seek out Bill Clinton and Alan Greenspan. It is
clear to me, Clinton has a better command of economics than you.
Greenspan says he and Bill are an odd couple, a live wire and dry
economist but they both like books and music. You could invite them
to dinner and face the music. Such a dinner may be difficult to keep
secret so maybe a confidential telephone call would do. Sound out
what these outsiders see and sense how Geithner is doing. There were
news reports that Volcker criticized the slow staffing of Treasury
positions and that Summers has disagreed with Geithner.
By the way your Secretary of Agriculture has seriously failed the hog
and dairy farmers.
It would take time to vet out replacements,start vetting now so you
could do it in the new year. Please learn the lessons of history ie
G.W Bush. He was blindly loyal to his staff ie Rumsfeld. Your praise
of Geithner of doing a great job has a familiar ring ie “Great job,
Brownie”. You know what happened.
The “too big to fail problem” is common to the banking system, Freddy
and Fannie Mae and the single payer health care discussion. I think
those who wrote the anti-trust laws tried to address this issue. The
Federal Reserve has regional banks. Canada has six major banks.
Breaking up Alcoa and the railways was successful. I think breaking
up ATT was less successful but don’t know why. Maybe some wisdom can
be gleaned from the principles of anti-trust so their wouldn’t be a
single payer but a group of regional not for profit health care
payers. The whole world knows Goldman Sachs, Bank of America and AIG
are too big. Doesn’t anti-trust apply?
On the anniversary of the Lehnman Brother bankruptcy, a wealth manager
of 2 billion dollars was asked what the government should have done.
He gave a version of my suggestion, to calculate the fair market value
of the securitized mortgages which I had sent you in March.
For me the sense of justice is missing in your administration. I
believed the change your campaign advocated was for a just society.
The rich bankers on Wall Street gambled and lost but Geithner lined
their pockets. My proposal of calculating the fair market value of
securitized mortgages and booking the loss to the banks is justice.
There was no justice, the tax payers paid for the banker’s losses.
I told you the sugar beet and corn (for fructose) farmers control the
market of sweeteners in the US economy and get subsidies. Dairy
farmers don’t have the same benefits. Milk is outpriced to the
fructose laced drinks and dairy families are forced out of business.
This is unjust, yet your administration has done nothing. Your
economic team reports no inflation because they exclude food and gas.
For me the cost of bread and milk has doubled, what’s the point of
saying there is no inflation? I feel it unjust that you don’t know
anyone who can tell you the price of a loaf of bread and a gallon of
milk.
Some companies paint on their trucks a sign that says “How’s my
driving? Call ….”
Every driver, you included, thinks he drives just fine. As an outside
observer, I’d like to suggest that you have blind spots in your
command of economics. You are deferring to your advisors. You lack
the background to know a good idea when handed to you. My suggestion
is that you privately seek out Bill Clinton and Alan Greenspan. It is
clear to me, Clinton has a better command of economics than you.
Greenspan says he and Bill are an odd couple, a live wire and dry
economist but they both like books and music. You could invite them
to dinner and face the music. Such a dinner may be difficult to keep
secret so maybe a confidential telephone call would do. Sound out
what these outsiders see and sense how Geithner is doing. There were
news reports that Volcker criticized the slow staffing of Treasury
positions and that Summers has disagreed with Geithner.
By the way your Secretary of Agriculture has seriously failed the hog
and dairy farmers.
It would take time to vet out replacements,start vetting now so you
could do it in the new year. Please learn the lessons of history ie
G.W Bush. He was blindly loyal to his staff ie Rumsfeld. Your praise
of Geithner of doing a great job has a familiar ring ie “Great job,
Brownie”. You know what happened.
The “too big to fail problem” is common to the banking system, Freddy
and Fannie Mae and the single payer health care discussion. I think
those who wrote the anti-trust laws tried to address this issue. The
Federal Reserve has regional banks. Canada has six major banks.
Breaking up Alcoa and the railways was successful. I think breaking
up ATT was less successful but don’t know why. Maybe some wisdom can
be gleaned from the principles of anti-trust so their wouldn’t be a
single payer but a group of regional not for profit health care
payers. The whole world knows Goldman Sachs, Bank of America and AIG
are too big. Doesn’t anti-trust apply?
Monday, September 7, 2009
Peanut butter and jam sandwiches
To: Christina Romer
I have chosen to write to you because my emails to the President, have
been ineffective.
In your public appearances, you say that inflation requires increases
in wages and you see no sign of wages increasing. I am no match to you
in competency on this issue.
My concern is that your denial of the existence of inflation is
failing to address the high cost of living. Here is an example that
means a lot to me.
One of the President's daughters eats peanut butter and jam sandwiches
with a glass of milk.
The price of bread has doubled in the past two years. The worldwide
shortage of sugar affects the price of peanut butter and jam. Grain
and sugar beat farmers are making a fortune. The taxpayers are
providing huge amounts of subsidy money to them as well as the farmers
of corn for fructose. Throughout the whole chain of sowing, harvest,
processing, packaging and selling, high energy costs affect the price
of bread, milk, peanut butter and jam.
Where I live, the price of milk has doubled in the past three years,
though news reports say prices have dropped in California. Dairy
farmers don't have a collective to absorb the shocks of free market
pricing of milk. The price of feed and energy hurts them.
Capitalists believe the market sets the best price. Forcing dairy
farmers out of business is not good for President Obama's daughter's
glass of milk, nor milk for Americans.
Your data doesn't see inflation. I hope you see the cost of living. I
guess technically it is not inflation.
Health care is the hot topic. I don't see fiscal reform as a priority
because the recent SEC report stated that the SEC had failed. Energy
policy does need to be thought through.
Here are things that are important to me, that I think you should
advise the President.
-Reforming the farm subsidies would reduce the government deficit.
-Competency in the Treasury Department, still hasn't addressed the
banking problems of a year ago. Their reckless attempts to save the
banks has resulted in rich bankers and wasted taxpayer spending (AIG
payment to Goldman Sachs using taxpayer money, bonuses to Goldman
Sachs using taxpayer money and this fall to AIG executives). A
government job (Wage czar) to tell private companies how much to pay
their employees is a waste of taxpayer money. There is no fiscal
policy going forward.
The government is noticeably absent in dealing with economic issues
(only recycling tired cliches, "meltdown wasn't of our doing" and "our
stimulus package"). Politically this is unwise; the Republican
campaign will be the winning line "The economy, stupid!"
I hope you can advise the President to direct fiscal policy to address
the peanut butter and jam sandwich issues.
I have chosen to write to you because my emails to the President, have
been ineffective.
In your public appearances, you say that inflation requires increases
in wages and you see no sign of wages increasing. I am no match to you
in competency on this issue.
My concern is that your denial of the existence of inflation is
failing to address the high cost of living. Here is an example that
means a lot to me.
One of the President's daughters eats peanut butter and jam sandwiches
with a glass of milk.
The price of bread has doubled in the past two years. The worldwide
shortage of sugar affects the price of peanut butter and jam. Grain
and sugar beat farmers are making a fortune. The taxpayers are
providing huge amounts of subsidy money to them as well as the farmers
of corn for fructose. Throughout the whole chain of sowing, harvest,
processing, packaging and selling, high energy costs affect the price
of bread, milk, peanut butter and jam.
Where I live, the price of milk has doubled in the past three years,
though news reports say prices have dropped in California. Dairy
farmers don't have a collective to absorb the shocks of free market
pricing of milk. The price of feed and energy hurts them.
Capitalists believe the market sets the best price. Forcing dairy
farmers out of business is not good for President Obama's daughter's
glass of milk, nor milk for Americans.
Your data doesn't see inflation. I hope you see the cost of living. I
guess technically it is not inflation.
Health care is the hot topic. I don't see fiscal reform as a priority
because the recent SEC report stated that the SEC had failed. Energy
policy does need to be thought through.
Here are things that are important to me, that I think you should
advise the President.
-Reforming the farm subsidies would reduce the government deficit.
-Competency in the Treasury Department, still hasn't addressed the
banking problems of a year ago. Their reckless attempts to save the
banks has resulted in rich bankers and wasted taxpayer spending (AIG
payment to Goldman Sachs using taxpayer money, bonuses to Goldman
Sachs using taxpayer money and this fall to AIG executives). A
government job (Wage czar) to tell private companies how much to pay
their employees is a waste of taxpayer money. There is no fiscal
policy going forward.
The government is noticeably absent in dealing with economic issues
(only recycling tired cliches, "meltdown wasn't of our doing" and "our
stimulus package"). Politically this is unwise; the Republican
campaign will be the winning line "The economy, stupid!"
I hope you can advise the President to direct fiscal policy to address
the peanut butter and jam sandwich issues.
Saturday, July 18, 2009
I give up on the Obama Economic Team
President Obama has repeatedly said that we will get out of Iraq with
more care than we got into Iraq.
I suggest he must speak to Geithner about showing more care in
spending the people's credit than his public contempt when he admits
he has no exit strategy for the bailout commitments.
Geithner failed the President when the President announced in early
March that the plan to address the banking crisis would be presented.
There was no plan.
Geithner embarrassed the President when Goldman Sachs received
additional billions of dollars from the US taxpayers when AIG passed
Goldman part of the money AIG got from the taxpayers.
At this very moment, there is no evidence Geithner can get ahead of issues.
He neither speaks clearly nor with authority. Geithner says he works
for the public, the email address officeofthetreasurer@ustreas.gov
doesn't work and I doubt he has ever read any correspondence from the
public.
This is a very possible economic future.
2009-2010 are ok because of the stimulus package.
2011 inflation, devalued dollar, high interest rates for government
borrowing, stubborn unemployment and no money to lift the housing
market.
Did you know 2012 would be an election year? One political sage once
said, It's the economy stupid.
The Obama people give me the feeling that my concern for the country
is misplaced. I will no longer waste their time, despite their best
efforts, the public good is not served.
My parting advice is to hire James Baker for Treasury and James
Galbraith as economic advisor.
more care than we got into Iraq.
I suggest he must speak to Geithner about showing more care in
spending the people's credit than his public contempt when he admits
he has no exit strategy for the bailout commitments.
Geithner failed the President when the President announced in early
March that the plan to address the banking crisis would be presented.
There was no plan.
Geithner embarrassed the President when Goldman Sachs received
additional billions of dollars from the US taxpayers when AIG passed
Goldman part of the money AIG got from the taxpayers.
At this very moment, there is no evidence Geithner can get ahead of issues.
He neither speaks clearly nor with authority. Geithner says he works
for the public, the email address officeofthetreasurer@ustreas.
doesn't work and I doubt he has ever read any correspondence from the
public.
This is a very possible economic future.
2009-2010 are ok because of the stimulus package.
2011 inflation, devalued dollar, high interest rates for government
borrowing, stubborn unemployment and no money to lift the housing
market.
Did you know 2012 would be an election year? One political sage once
said, It's the economy stupid.
The Obama people give me the feeling that my concern for the country
is misplaced. I will no longer waste their time, despite their best
efforts, the public good is not served.
My parting advice is to hire James Baker for Treasury and James
Galbraith as economic advisor.
Friday, March 20, 2009
Yet another try on banking
There is a problem with bailouts.
Why didn't the bank bailout of September 2008 solve the problem and when are we getting our money back? When debating whether to bail out the car manufacturers, certain members of Congress asked, what assurances there are, that more bailouts won't be needed. Without finding out what went wrong, what's stopping the banks from asking for more next year?
Where is the accountability of the bailouts?
Bailouts build a house of cards to cover up the banks' collapsed house of cards. This didn't work in Japan. Japans' banks' books were cooked, they never addressed it and after ten years they still haven't dug themselves out because their house of cards cancels the effectiveness of fiscal or monetary policy.
Bailouts don't restore free market principles, rather it weakens them. The government props up failed managements, weak board of directors and destroys ownership accountability. There is no exit strategy to remove the massive infusion of the peoples money into the banks.
I think the conclusion is that we have tried bailouts and they have failed.
When dealing with the banking problem we should address the fundamental problem, the inaccurate accounting records at the banks.
Performing stress tests on faulty accounting records only produces inconclusive calculations. The stress tests are a superficial excuse, to give bailout money according to personal whims, such in the case of Paulson always favoring Goldman Sacks. A suggestion of saving the biggest campaign donors could be made.
It is inevitable that the bank ownerships will change. The government is not tackling the banking problem in the right order. The government should restore the accuracy of banking records first. Then, it would clearly know how much to prop up the banks. With accurate records and government support, trust will be restored to the credit market, the banks can be sold at a better price because new owners don't have to the discount the unknown and the on-going shape of the market is healthy.
There are two accounting issues.
1)the fair market value of securitized mortgages
2) the bundled mortgages should be booked as long term assets but because of the bundling the mortgages are in current assets. This distorts all significant financial ratios.
Securitized mortgages are faulty because there they could not handle lowering property values. The accountability of the bundled mortgages should lie with the bundler because they own the title. They diffused accountability when they bundled the mortgages. This is what must be restored.
The government should consolidate all bundled securitized mortgages, use a task force of Audit firms to re-value them, then re-distribute the actual mortgages back to eligible holders.
The banks will properly show mortgages in their long-term assets instead of current assets when they held the securitized slices.
Here is a proposal that is open to any improvements. I hope it is transparent that it tries to address the real problem.
Detailed explanation.
Securitized mortgages means mortgages were bundled then tranches of the bundle were sold off. The accountability of mortgage ownership got lost in this process so when housing prices dropped, no clear owner could be found. In the end it is truly the banks who should own the mortgages but they moved they mortgages holdings from long term assets to current assets to give the appearance of improved financial ratios.
1)Collect all bundled mortgages.
2)Classify the Mortgages
Within each bundle is a list of mortgages.
All the mortgages must be placed on a master list.
This list must be sub-divided in the following order:
Region/city New England, Rust belt, New York, East coast, Florida, Nevada etc
Interest rate Standard prime, escalating interest rates including subprime
Current market value divided by mortgage
Mortgagee income to mortgage amount -ability to repay
Within each region you will be able to determine three categories
Low, medium and high risk.
3)Calculate the write down.
4)Collect all holders of bundled mortgages
5)Pro-rate the write down according the portion of the bundled mortgage holding.
6)Classify holders
Banks allowed to issue Mortgages in US and those not allowed.
7)Re-distribute the gathered mortgages to the banks allowed to issue mortgages in the US.
The US government only has jurisdiction over banks allowed to issue mortgages in the US. The other holders will get no mortgages, it's a risk they took. If this is too severe offer silent partner relationships with the banks with title.
The redistribution will have to depend on what the data looks like. Redistribution must be as fair as possible so should be done before a tribunal using a lottery if necessary. Ideally regions would be distributed to a regional bank but markets may have to be tranched among several banks to fairly spread the risk.
The treasury will have to engage external auditors who just completed auditing the bankers books to staff the project and will need information technology assistance.
Credit Default Swaps
Now that we have valued the bundled mortgages, the credit default swaps (CDS) can be valued. The swap issuers wanted to be unregulated, so be it. The government should pressure any purchaser who has received TARP funds to annul all their credit default swaps. This should provide relief to the financial institutions who issued CDS. The TARP purchaser is double dipping government funds since it took the TARP money and also gets the swap payout from AIG which is also government money. If the outstanding payout is still too much, the government declares that under exceptional circumstances (economic distress) the issuers of CDS are not obligated to fully honor payment on an illegitimate financial instrument, the securitized mortgages. So, only a partial payout will be required.
There is no need for a government bailout. This government intervention is doing for the public what an individual citizen cannot do, in the fairest way possible.
We will have restored, as fairly as possible, a mortgage market true to capitalism.
Sunday, March 1, 2009
2009 March 1
I see the banking crisis as a repeat of the Enron affair.
G. W. Bush K. Lay
B. Obama J. Skilling
T. Geithner A. Fastow
Geithner, the Wall St wiz kid, has been asked to build a house of cards to cover up the banks' collapsed house of cards.
This doesn't work. Japans' banks' books were cooked, they never addressed it and after ten years they still haven't dug themselves out because their house of cards cancels the effectiveness of fiscal or monetary policy. There is no exit strategy to recover the government's infusion.
The foundation of the capitalistic free market is accurate accounting records. Americans believe in honesty and believe cheaters should get punished.
It is inevitable that the bank ownerships will change. The government is not tackling the banking problem in the right order. The government should restore the accuracy of banking records first. Then, it would clearly know how much to prop up the banks. With accurate records and government support, trust will be restored to the credit market, the banks can be sold at a better price because new owners don't have to the discount the unknown and the on-going shape of the market is heathy.
There is an honest approach to solving the banking problem. If you believe in capitalism, you will see that it is the right solution.
The government consolidates all bundled securitized mortgages, uses a task force of Audit firms to re-value them, then re-distribute the actual mortgages back to eligible holders.
The banks will properly show mortgages in their long-term assets instead of current assets when they held the securitized slices (An improper accounting shift to enhance executive bonus's).
We will end up with a mortgage market true to capitalism.
Detailed explanation.
Securitized mortgages means mortgages were bundled then tranches of the bundle were sold off. Every mortgage is local so this instrument is invalid.
1)Collect all bundled mortgages.
2)Classify the Mortgages
Within each bundle is a list of mortgages.
All the mortgages must be placed on a master list.
This list must be sub-divided in the following order:
Region/city New England, Rust belt, New York, East coast, Florida, Nevada etc
Interest rate Standard prime, escalating interest rates including subprime
Current market value divided by mortgage
Mortgagee income to mortgage amount -ability to repay
Within each region you will be able to determine three categories
Low, medium and high risk.
3)Calculate the write down.
4)Collect all holders of bundled mortgages
5)Pro-rate the write down according the portion of the bundled mortgage holding.
6)Classify holders
Banks allowed to issue Mortgages in US and those not allowed.
7)Re-distribute the gathered mortgages to the banks allowed to issue mortgages in the US.
The US government only has jurisdiction over banks allowed to issue mortgages in
the US. The other holders will get no mortgages, it's a risk they took. If this is too severe offer silent partner relationships with the banks with title.
The redistribution will have to depend on what the data looks like. Redistribution must be as fair as possible so should be done before a Judge (We want justice). Ideally regions would be distributed to a regional bank but markets may have to be tranched among several banks to fairly spread the risk.
The treasury will have to engage external auditors who just completed auditing the
bankers books to staff the project and will need information technology assistance.
Credit Swaps
Now that we have valued the bundled mortgages, the credit swaps can be valued. The swap issuers wanted to be unregulated, so be it.
There is no need for a government bailout. This government intervention is doing for the public what an individual citizen cannot do, in the fairest way possible.
We will have restored, as fairly as possible, a mortgage market true to capitalism.
2005 April 26
G. W. Bush pulled the wool over American eyes when he attacked Iraq.
He said Weapons of Mass Destruction but he really meant oil.
Now there is more pressure to increase oil supply.
Because Iraqi oil will not arrive in America in time, Bush has his sights set on Iranian oil.
He will talk about nuclear threat of Iran but he will attack for the oil.
Within the next two years, unemployment will rise in the US, the young will join Uncle Sam for the money.
He will plan to attack Iran in March of 2007, fours years after the attack on Iraq.
Bush has started the fight with "All options are on the table."
He will harp on the escalation of Iranian nuclear activity.
Pay attention when he asks Congress to go to war!
Read his lips. Connect the dots.
Lesson about Democracy - Presidents lie.
Bill Clinton lied to Americans when he said he did not have sexual relations.
He deserved to be impeached because he violated the trust between the President and citizens of America.
Bush/Cheney invaded Iraq because they wanted the oil. They never admitted it, they made up other stories, they lied.
Cheney's energy plan divided the Iraqi oil fields among American Oil Companys while ensuring Haliburton's illegal investments in Iraq.
If it worked, it would've been great for Cheney's bank account.
Because it didn't work, they needed a scapegoat and some cover for re-election.
Bush is very sensitive to bad news.
Wilson made up some of his story but it wasn't a personal attact against Bush, however the doubt he introduced had traction.
Rove and Libby (Cheney's Office) had the goods to snuff the traction and attack the opposition at the CIA to the fabricated reasons to attack Iraq.
Press secretary Scott M assured Americans that Rove and Libby had nothing to do with spreading the word that Wilson's wife worked at the CIA.
Bush and Cheney were safe behind the scapegoat that the mistake of going to war was due to was faulty intelligence from a disfunctional CIA, that hires incompetent Democrats as operatives who waste taxpayer money on their spouses. Tenet gets a freedom medal for heading this organization.
Republican Haliburton gets to screw taxpayers big time.
Democrats screw things up by giving their spouses trips to Africa on taxpayer money.
Neither the Republicans nor Democrats care about the life of our soldiers, the sorrow of the wounded and grief of the families of the killed. There is no concern for the 100,000 innocent Iraqi's killed by mistake, by being at the wrong place at the wrong time or mere misunderstanding by American troops.
I think Rove and Libby lied to Scott M when they said they had nothing to do with leaking Wilson's wife's position.
Bush wants to stay in Iraq so America will get the oil, not China or India. Greed is driving his reason to stay in Iraq.
Bill Clinton's dirty lies victimized women, Ms S Mcdonnel who was sent to jail by the Special Prosecutor, Monica L, Jennifer F, Hilary among others.
Bush/Cheney lies profit rich Americans and victimize the troops (composed of lower class stock) and their families and Iraqi's and in the end Americans.
The dirtiest lie is that Bush and Cheney went to Iraq for the oil and never admitted it.
The three cheats, Clinton, Bush and Cheney all dodged the draft in their way.
Liars and cheats as President of the United States.
Cheney has been a cheat all his life, dodged the draft by staying in school (flunked at Yale) and getting married and having children. At Haliburton, he fought the embargo against Iraq and worked in Iraq when it was against the law.
Bush's way to dodge the draft was a dubious history in the Air Force Reserves, and the way he avoids questions about it make him a cheat.
If you believe that Bush and Cheney invaded Iraq for the oil, then they have breached the trust of Americans.
If you want America to get out of Iraq, stop the American dependence on Middle East oil. Over half the imported oil is used to make gasoline. This means every American should be prudent when consuming oil based products from gas to plastics.
This is the new politics. Save America by living within its energy and economic means. Redesign cities so people live near where they work, can walk to do groceries and shopping,
have hoods over the sidewalks in the south so people can walk (it's only hot in the sun).
Give hope, don't live in the gloom of George Bush's leadership.
He said Weapons of Mass Destruction but he really meant oil.
Now there is more pressure to increase oil supply.
Because Iraqi oil will not arrive in America in time, Bush has his sights set on Iranian oil.
He will talk about nuclear threat of Iran but he will attack for the oil.
Within the next two years, unemployment will rise in the US, the young will join Uncle Sam for the money.
He will plan to attack Iran in March of 2007, fours years after the attack on Iraq.
Bush has started the fight with "All options are on the table."
He will harp on the escalation of Iranian nuclear activity.
Pay attention when he asks Congress to go to war!
Read his lips. Connect the dots.
Lesson about Democracy - Presidents lie.
Bill Clinton lied to Americans when he said he did not have sexual relations.
He deserved to be impeached because he violated the trust between the President and citizens of America.
Bush/Cheney invaded Iraq because they wanted the oil. They never admitted it, they made up other stories, they lied.
Cheney's energy plan divided the Iraqi oil fields among American Oil Companys while ensuring Haliburton's illegal investments in Iraq.
If it worked, it would've been great for Cheney's bank account.
Because it didn't work, they needed a scapegoat and some cover for re-election.
Bush is very sensitive to bad news.
Wilson made up some of his story but it wasn't a personal attact against Bush, however the doubt he introduced had traction.
Rove and Libby (Cheney's Office) had the goods to snuff the traction and attack the opposition at the CIA to the fabricated reasons to attack Iraq.
Press secretary Scott M assured Americans that Rove and Libby had nothing to do with spreading the word that Wilson's wife worked at the CIA.
Bush and Cheney were safe behind the scapegoat that the mistake of going to war was due to was faulty intelligence from a disfunctional CIA, that hires incompetent Democrats as operatives who waste taxpayer money on their spouses. Tenet gets a freedom medal for heading this organization.
Republican Haliburton gets to screw taxpayers big time.
Democrats screw things up by giving their spouses trips to Africa on taxpayer money.
Neither the Republicans nor Democrats care about the life of our soldiers, the sorrow of the wounded and grief of the families of the killed. There is no concern for the 100,000 innocent Iraqi's killed by mistake, by being at the wrong place at the wrong time or mere misunderstanding by American troops.
I think Rove and Libby lied to Scott M when they said they had nothing to do with leaking Wilson's wife's position.
Bush wants to stay in Iraq so America will get the oil, not China or India. Greed is driving his reason to stay in Iraq.
Bill Clinton's dirty lies victimized women, Ms S Mcdonnel who was sent to jail by the Special Prosecutor, Monica L, Jennifer F, Hilary among others.
Bush/Cheney lies profit rich Americans and victimize the troops (composed of lower class stock) and their families and Iraqi's and in the end Americans.
The dirtiest lie is that Bush and Cheney went to Iraq for the oil and never admitted it.
The three cheats, Clinton, Bush and Cheney all dodged the draft in their way.
Liars and cheats as President of the United States.
Cheney has been a cheat all his life, dodged the draft by staying in school (flunked at Yale) and getting married and having children. At Haliburton, he fought the embargo against Iraq and worked in Iraq when it was against the law.
Bush's way to dodge the draft was a dubious history in the Air Force Reserves, and the way he avoids questions about it make him a cheat.
If you believe that Bush and Cheney invaded Iraq for the oil, then they have breached the trust of Americans.
If you want America to get out of Iraq, stop the American dependence on Middle East oil. Over half the imported oil is used to make gasoline. This means every American should be prudent when consuming oil based products from gas to plastics.
This is the new politics. Save America by living within its energy and economic means. Redesign cities so people live near where they work, can walk to do groceries and shopping,
have hoods over the sidewalks in the south so people can walk (it's only hot in the sun).
Give hope, don't live in the gloom of George Bush's leadership.
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