Future of Credit

[TheMercenary]

Originally Posted by Redux

The current credit crisis did not begin in 2006 but in 1999 ...

Actually it began before that. But I am sure that we can look at the influence of Barney Frank, ultra liberal democrat who set the stage for the meltdown, and as the Chairman of the House Financial Services Committee and his buddy Chris Dodd, who thank God will not be around after the next election. And to ignore the fact that the Congress has been controlled by the Dems for over 2 years and have made repeated promises to the electorate to change the way business is done only solidifies their failures and responsibility in this mess. There is plenty of blame for this mess to go around but 2 years is more than enough time to stop blaming other people for your parties failures.

And, IMO, most credit card holders will benefit from the credit Card Holders Bill of Rights legislation signed into law last year and taking effect this month...but that still wont fix the credit market.

I have not disagreed with that statement.

Originally Posted by piercehawkeye45

I understand it is that loans and credit are what keep our economy growing and if credit scores are so bad that people stop taking out loans, wouldn't that greatly hurt the economic growth of the country? On a slight tangent, our current recession is due, at least in part, to the lack of loans out in the housing market?

Putting the personal credit scores aside...you hit what is behind the Fed's current monetary policy...keeping interest rates as low as possible to keep credit flowing.

Along with pushing healthy banks to buy smaller failing banks. But that also tighthens the market because those healthy banks buy the good and bad assets of the failing banks and thus are not able to expand or extend credit to new consumers/small businesses.

[classicman]

The administration gave these banks a SHITLOAD of money under the assertion that they would lend it out - The banks haven't done that. Instead they have increased the pay and bonuses of their executives.

Originally Posted by classicman

The administration gave these banks a SHITLOAD of money under the assertion that they would lend it out - The banks haven't done that. Instead they have increased the pay and bonuses of their executives.

In fact, the TARP funds were given mostly by the previous administration and most banks have payed in full and are lending again, but more selectively, particularly those (like Wells Fargo after buying Wachovia - just one example) still paying off the bad assets of the banks they absorbed.

And capping bonues of the execs has been proposed and blocked in the Senate.

Got any ideas how to get past that roadblock?

[TheMercenary]

Sen. Dick Durbin, on a local Chicago radio station this week, blurted out an obvious truth about Congress that, despite being blindingly obvious, is rarely spoken: "And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place."

http://www.salon.com/opinion/greenwa.../30/ownership/

[TheMercenary]

Former Barney Frank staffer now top Goldman Sachs lobbyist

Paese went from Chairman Frank's office to be the top lobbyist at Goldman, and shortly before that, Goldman dispatched Paese's predecessor, close Tom Daschle associate Mark Patterson, to be Chief of Staff to Treasury Secretary Tim Geithner, himself a protege of former Goldman CEO Robert Rubin and a virtually wholly owned subsidiary of the banking industry. That's all part of what Desmond Lachman -- American Enterprise Institute fellow, former chief emerging market strategist at Salomon Smith Barney and top IMF official (no socialist he) -- recently described as "Goldman Sachs's seeming lock on high-level U.S. Treasury jobs."

Sen. Evan Bayh's previously-reported central role on behalf of the bankers in blocking legislation, hated by the banking industry, to allow bankruptcy judges to alter the terms of mortgages so that families can stay in their homes. Bayh is up for re-election in 2010, and here -- according to the indispensable Open Secrets site -- is Bayh's top donor.

Goldman is also the top donor to Bayh over the course of his Congressional career, during which Bayh has received more than $4 million from the finance, insurance and real estate sectors.

In a totally unrelated coincidence -- after the Government, as Matt Taibbi put it, enacted "a bailout program that has now figured three ways to funnel money to Goldman, Sachs"-- this is what happened earlier this month:


Goldman reports $1.8 billion profit.

Imagine that.

I give up.

Sorry piercehawk...its all Barney's fault even though he was in the minority party between 1994-2006 when the credit market blew up.

Take Merc and Classic's advice/critique (?) and go for the gold! They have all the answers!

[classicman]

Originally Posted by Redux

In fact, the TARP funds were given mostly by the previous administration

You mean the bailout in October that Bush specifically consulted with Obama on beforehand?

"More Selectively" - C'mon. The banks haven't been loaning the money as freely as they should be. They are restricting capital to so many smaller business and cherrypicking the best of the rest. The idea was that the money would be getting back to the small business and general public through the lenders. That is NOT happening as it was envisioned.

[TheMercenary]

Originally Posted by Redux

In fact, the TARP funds were given mostly by the previous administration...

Only half. The rest were controlled by the Obama Administration. Nice try to deflect responsibility.

As of February 9, 2009, $388 billion had been allotted, and $296 billion spent, according to the Committee for a Responsible Federal Budget. Among the money committed.

Of a total of $700 billion.

http://en.wikipedia.org/wiki/Trouble...Relief_Program

[classicman]

Originally Posted by piercehawkeye45

wouldn't a large distrust between banks and loaners cause HUGE problems with the house industry?

Yes

And if this is true, is their any speculation on possible ways those industries will evolve because of this?

Tons, but its just that, all speculation. The end result will depend upon how heavily regulated they are or aren't and the monetary climate at the time.

[piercehawkeye45]

Originally Posted by Redux

Sorry piercehawk...its all Barney's fault even though he was in the minority party between 1994-2006 when the credit market blew up.

Obviously this entire situation is the result of a lot of mess ups from both sides.

[classicman]

Agreed - All three sides.

Originally Posted by classicman

Agreed - All three sides.

I offered my opinion to piercehawkeye that it was more an economic issue than anything else and explained why I thought that was the case. *shrug" he can take it or leave it.

And, honestly, I just dont understand how you (and Merc) can bitch about the current Administration not acting forcefully enough...and bitch when the House passes forceful banking/financial services legislation to address the problem, as it did last year.

Remember that discussion in the "more bailouts" thread? I mostly remember you bitching that I attacked a member of the community and Merc being against regulations and for regulations at the same time...and still blaming Barney, who pushed through the legislation.

Wait, I do understand....you guys just like to bitch and NEVER offer constructive solutions as an alternative to those proposed.

added:
my apologies to piercehawkeye for contributing to the resulting distractions.

[classicman]

When did I bitch about that? I bitched about a lot of things, but I don't think that was one of them. Then again I could have been in one of my moods . . .

[TheMercenary]

Originally Posted by Redux

I offered my opinion to piercehawkeye that it was more an economic issue than anything else and explained why I thought that was the case. *shrug" he can take it or leave it.

And, honestly, I just dont understand how you (and Merc) can bitch about the current Administration not acting forcefully enough...and bitch when the House passes forceful banking/financial services legislation to address the problem, as it did last year.

Remember that discussion in the "more bailouts" thread? I mostly remember you bitching that I attacked a member of the community and Merc being against regulations and for regulations at the same time...and still blaming Barney, who pushed through the legislation.

Wait, I do understand....you guys just like to bitch and NEVER offer constructive solutions as an alternative to those proposed.

added:
my apologies to piercehawkeye for contributing to the resulting distractions.

Maybe when you guys start accepting blame for the current situation my tune will change. But as long as you act like your party has all the solutions and few of the responibilities...

The electrate is beginning to see through your Kabuki Theater.