I'm going to admit that I don't get everything he's saying, but I get some of it.

I don't know dick about duck, but it makes sense to me. For what little that's worth.

Part 2 is interesting. Note that part of the reason these assets are being driven down closer to zero is due to what is, frankly, gaming the system by hedge funds and other big investors, driving the prices down in order to force a sell-off. That's not illegal (yet), and yes, it's the fault of holders of these assets to have exposed themselves to this sort of risk, but the point is 1) "unnatural" forces, if you will, are causing these assets to be undervalued, 2) upside pressure on the price will stop this just the same as drilling for new oil in the US will stop oil market speculators from driving the price of oil up, and 3) the US government appears the only entity in existence with the financial muscle to halt this.

more...

Posted by: Ace at 10:25 AM | Comments (91)
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Harry Reid slips extension of the oil shale ban into continuing resolution appropriations bill. Jim DeMint's office busted him.

Not. Serious. They're just not. Either that or they're so damned dumb they believe no one will notice (or care).

Something to keep in mind the next time a gang of 10 or 16 or 20 Republicans attempts to negotiate with these dipshits.

Posted by: Dave in Texas at 08:59 AM | Comments (55)
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This got a little lost yesterday in all the bailout talk (and my trip to the dentist) but this is very good news.

You know that whole ‘there’s been no political reconciliation in Iraq’ talking point they’ve been using since the surge started? Deader than the hooker in Godfather II.

Iraq's parliament overwhelmingly approved a provincial elections law Wednesday, overcoming months of deadlock and giving a boost to U.S.-backed national reconciliation efforts.

Also Wednesday, gunmen opened fire on a group of Iraqi policemen and members of a so-called awakening council northeast of Baghdad, killing 22, the U.S. military said.

U.S. officials have complained privately that Iraqi politicians have failed to take advantage of the sharp drop in violence — down 80 percent since last year, according to the U.S. military — to forge lasting power-sharing agreements.

The legislation had been bogged down in a complex dispute between Arabs and Kurds over power sharing in the oil-rich city of Kirkuk, which Kurds seek to incorporate into their semiautonomous region.

Lawmakers acknowledged the delay in passing the measure would make it difficult for the electoral commission to organize the vote and pushed back the deadline for it to be held until Jan. 31, 2009.

In reading a bunch of stories on this itÂ’s amazing how hard the MSM is working to spin this as a negative, bog it down with all sorts of caveats or just flat out ignoring it.

In fairness to our friends in the media, it must be tough to have fought so hard but still lose the war.

Posted by: DrewM at 08:45 AM | Comments (24)
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No, Congressman, he isn't a cold-blooded murderer.

WASHINGTON, PA (KDKA) ― A local Marine cleared in the deaths of civilians in Iraq says Congressman John Murtha made public comments that were unproven, untrue and unfair.

Now, Lance Corporal Justin Sharratt is planning to file suit in federal court against Murtha on Thursday morning.

The suit accuses the congressman of slander and violating the Marine's right to a fair trial and due process.

This CNN story provides background into the Murtha line that started it all. If you'd like to assist Sharratt in his suit, his website has information on how to donate to his legal fund.

Posted by: Slublog at 05:26 AM | Comments (50)
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Seriously folks, just take some NyQuil or Simply Sleep or something.

Posted by: Gabriel Malor at 11:42 PM | Comments (69)
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I'm not a fan.

First, I think Ace is on the right track when he reminds us that these assets that the government proposes to buy are not worthless and that the government stands to recover some of the cost. However, the people predicting a 20-25% return on this "investment" are wildly speculating based on very little information.

The claim is that none of the banks which currently hold mortgage-backed securities can properly value the securities (they are opaque) so none of them can buy or sell them (they are illiquid). The idea behind the bailout is that a government agency will be created that will take a guess at a price, purchase them, then determine their actual value, make that information public, and auction them back into the market. Dafydd calls it a "reset button."

Why can't the financial services institutions do all that themselves? Because in the meantime the securities are valueless. That represents a serious loss and the institutions are finding out that they have far less capital than they previously thought. Some institutions are simply worth less, but they'll live through it. Others are declaring bankruptcy or threatening the government that they will declare bankruptcy in an attempt to get a handout.

We are being asked to rely on a few assumptions here that we shouldn't. Proponents of the bailout emphasize that the purchases of these securities will be at very low, bargain-bin, "huge discount" prices and so (they claim) it's very possible that the government will be able to sell them for a profit after they've been properly valued.

The problem with this is that the point of buying these securities is to keep the financial services institutions from crumbling. This means the price is not going to be set according to a low-ball evaluation of the security. Rather, it's going to be whatever each financial services institution claims it needs to keep itself in business. Given how much the value of these securities was overestimated in the first place (in other words, how much the banks need to make up in order to keep from collapsing), that price is going to be much too high to realize an extraordinary profit...if it makes a profit at all.

More than that, I'm skeptical of the claim that the financial institutions have absolutely no idea of the value of these securities. They may not be able to pin a price to them, but they've probably got some idea which ones are in better shape and which ones are the lowest of the low. Guess which ones are going to get sold to the government first.

We're also assuming that the act of evaluating the securities and auctioning them will be fairly inexpensive. But if that were true, it would already have been done and the government would never have needed to get involved. TANSTAAFL.

Some argue that we need to keep these financial institutions in good shape or there will be a "credit meltdown" or "credit crash." I don't think that's the case. This comes from a misunderstanding of just where credit comes from. It doesn't, doesn't, doesn't come from financial institutions (well, okay, it does sometimes, but not exclusively or even predominantly; I overdid the hyperbole).

A bank-lender is just a middleman. He's taking someone else's money and letting you borrow it so as to make some profit on the interest (presumably, you're going to do something productive with it or be able to pay it off even if you don't). And, of course, the bank skims a little off the top. If the bank goes out of business, the person offering it for loans is still there. All that has happened is the person who wants to lend it and the person who wants to borrow it need to find another middleman. In other words, credit is still available so long as the person wants to lend it, no matter what happens to the bank. And he will want to lend it, so long as he believes there are promising investment opportunities.

When you get right down to it, if we're so worried about credit drying up then the government can simply become a lender to those types of investors who face a credit crunch. Perhaps, say, to the tune of $700 billion dollars? Now that's an investment where we've got a better chance of making a profit. By the way, there isn't a credit crunch right now. Lending is still on the rise for consumer, industrial, commercial, and real estate loans. People keep saying the credit crisis will appear if we don't bail out the banks.

Since Congress seems determined to do something just so they can say they did, fending off a credit crisis directly rather than as a derivative effect of bailing out banks who have already shown they do not deserve to be saved is the better choice. This has the added benefit of avoiding the moral hazard in repeatedly bailing out failing industries. And it also keeps Congress from getting itself involved in resolving the mortgage meltdown.

Democrats want to rewrite mortgages so the banks can't foreclose on delinquent borrowers. Of course, that will put some of the banks in even worse financial shape than they are now, which will necessitate larger bailouts from the government (that is, the taxpayer). The Democrats also want to extend the new agency's authority to purchase beyond just mortgaged-backed securities to any financial instrument which affects market stability. In other words, all of them.

This is a disaster waiting to happen. The best course of action for Congress is to do nothing and let the situation resolve itself. In short order we will have new market champions. If it absolutely has to do something, it can announce new lending programs to fend off a credit crunch (though this puts more pressure on private financial institutions and shouldn't really be done unless the credit crunch materializes).

But the wrong thing to do right now is take a wild-ass guess at an investment scheme that has already proven to be a failure while simultaneously giving the people who created the problem a do-over. That's not a good idea. And the absolute worst idea is letting the Democrats create a new federal agency which has long-term, intimate control of the financial services industry.

Whatever Congress does we are going to be stuck with the result for some time to come. The bailout proposals are not short-term fixes. Whatever agency or department is borne out of this, our children will know (and curse) its name. We owe it to ourselves and to them to not rush this decision.

Posted by: Gabriel Malor at 11:04 PM | Comments (149)
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Not even remotely under the bus. Jim Johnson has already been under there once after getting booted off Obama's VP search team. My impression is that unlike Grandma, Johnson simply had too much money and influence for Obama to keep him down there. Despite his ties to the Frannie/Freddie freakout he's still coordinating with Tom Daschle to pimp Obama to reluctant Clinton team members:

Former Senator Tom Daschle, a top Obama backer, emailed a select list this afternoon that he and Johnson would be leading a briefing intended largely for Clinton's campaign brain trust next month.

"Jim Johnson and I have scheduled another informal breakfast discussion and update on the campaign early next month," he wrote to a list including Senator John Kerry, James Carville, and Richard Holbrooke, as well as Clinton's former top campaign aides, including Howard Wolfson, Geoff Garin, and Harold Ickes.

[...]

The October third breakfast is also a mark of the continuing effort to bring the ex-Clintonites into the Obama fold.

Let me get this straight.

Republicans are still being blamed for the mortgage meltdown? More than Democrats? This is simply the most astounding failure to communicate.

Here's a reminder, be sure and read paragraph 8. Now email that to 3 friends or coworkers.

Posted by: Gabriel Malor at 10:49 PM | Comments (85)
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You'll like this one. The source is a "family member." Yeah.

Giggle. (Link to Dan Riehl, not the NE.)

Here's my favorite line:

“I’ve known about Brad having had an affair for a long time, but it wasn’t until just recently that I learned his affair was with Sarah Palin,” Burdett told The NATIONAL ENQUIRER.

Just recently? Like when the National Enquirer floated this rumor three weeks ago, or more recently than that, like when they stuffed a check into your broke-ass convict mitt?

Posted by: Ace at 09:33 PM | Comments (33)
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Somehow this post got deleted. So here it is again.

Pure awesome.

Thanks to ja.

Posted by: Ace at 09:16 PM | Comments (63)
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You know -- three years after he stopped being funny.

Damnit. How do I boycott someone for his politics when I already began boycotting him for having gotten old, broken, bitter, and unfunny 15 years go? more...

Posted by: Ace at 06:54 PM | Comments (145)
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