Bush’s "Being There" Moment?

In one of his most famous roles, actor Peter Sellers plays a character whose simple utterances are mistaken for words of wisdom.

Is today’s announcement of a plan to rescue American homeowners with credit problems George W. Bush’s real-life Being There moment?

Apparently, investors don’t think so.

Markets around the world are sharply higher this morning, buoyed by reports that the President will ask the Federal Housing Administration for help in allowing an additional 80,000 borrowers to keep their homes.

Mr. Bush also plans to try and convince lenders to work with mortgage-holders to limit foreclosures.

Yet these efforts, like those of Federal Reserve Board Chairman Ben S. Bernanke, who yesterday urged lenders to offer a “broader range of mortgage products…appropriate for low and moderate-income borrowers,” fail to take account of reality.

Even assuming that some troubled borrowers manage to hang on, the truth is that enabling more of the same kind of bad behavior that got people into trouble in the first place will only make matters worse.

The hair of the dog that bit them isn’t a cure. It merely delays the moment of reckoning.

In reality, guaranteeing loans for homeowners who can’t afford the payments, encouraging mortgage-holders to hang on until they’ve been bled dry, and giving false hope to those who would be better off cutting their losses really only benefits one group.

The lenders.

Of course, some would say that still makes sense, given recent disruptions in global credit markets and the growing threat of a systemic crisis.

Unfortunately, after decades of serial bubble-blowing, moral hazard-inducing bailouts, and other forms of government “assistance,” a mind-boggling array of financial imbalances means there is not a lot of room for maneuver.

Instead, there are only words.

“’The president wants to see as many homeowners who can stay in their homes with a little help be able to stay in their homes,’” reports the Wall Street Journal, quoting a senior administration official.

Translation: “All is well...and all will be well...in the garden.”

Chauncey Gardiner would have been proud.

Comments

[Knights of Nee]

Pay no attention to the man behind the curtain.

Tin Man, for you a pocket watch.
Scarecrow, for you a piece of paper called a diploma.
Cowardly Lion, a medal with the word Courage on it.

And for you my little sweet, its home to Kansas where the chickens are coming home to roost.

Repeat after me, "There is no place like home, there is no place like home."

We are indeed in the Land of OZ, and getting home will be rough going indeed.

Got Gold?

[Bruce Allen]

Obviously, anyone with even half-a-brain can see what's going on here. All of the sudden Mr. Bush rushes to the rescue, Bernanke is worshipped as some sort of hero, and people foolishly believe that the crisis is over, when in fact, it's only just begun.

One can't help but wonder if things ARE worse than Wall Street portrays them to be? Everyday we hear conflicting reports about the state of the economy. When you've got the president of the United States stepping up to the bat, and central banks all over the world pouring BILLIONS into the international markets, you can't help but wonder what's REALLY going on "behind the scenes". Either something big is about to go down, or some big corporation is in a lot of doo-doo... Time will tell. Let's see what September brings...

Thoughts Mike?

Bruce

[Michael Panzner]

I can't disagree with you. The worst is yet to come.

[bbybmr53]

More forclosures are coming. RE valuations and prices meaning equity is coming down. Exploding ARM resets are coming. Very strict lending requirements have come with 20% down requirements for jumbo loans(California housing)at 8% and higher. There are problems for companies getting short term funding for operating purposes(commercial paper).
Got hedge fund? Good luck!
The Fed is not a government entity. It's private and not really accountable. It's representatives are not elected. It doesn't enforce lending practices or hasn't. Fed prints money, loans it to the Government(the People) and charges interest on trillions of borrowed money that will never be paid back. Where is this going?

[Georgey Boy Bush]

Huh-WHAT are you sayin', boy??? I AM THE DE-CIDER. I DECIDE when we go bankrupt, and whin we don', you dig me? Now, my buddies, Ted Kennedy, John Kerry, John McCain, etc, are all doing a great job convincing the American public they have a say in a "two-party system" (HAHAHAHAHAHA!) We can't upset the huge amount of money, I mean goodwill we have earned over these last 20 years. Once we go bankrupt, I'll be over at my friend Ted Kennedy's compound, eating lobster and watching people starve on t.v...You can bet 'ol Ted won't starve either. Some people say we Republicans are wolves, and that may be true, but what they dont seem to unnerstand is that the Dems are wolves in sheep's clothing. Well, it's been real, ya'll. I'll be checking out here soon due to a disturbance in the upper atmosphere, but ya'll remember one thing, there is never enough road kill to go around when you are desperate to feed your family. Buy some fishing gear, and plenty of guns, they is a storm, a brewin'!
Good luck, and Good Night, Nurse!
G.B.W.

[Richie Conway]

I think I share Bruce's qualms about what is happening right now.

I also think that I qualify as Bruce's person with "half a brain" at least as far as high finance is concerned. Is it just me or, as far as financial matters are concerned, is it all just made deliberately obscure in order that we cannot see when we are being shafted?

I, for one, worry about two things.

Those with "no brain" when it comes down to our financial system - these people seem to make up a worryingly large proportion of those who we call investors.

Secondly I worry about the fact that we really do seem to be headed into unchartered waters, in global financial terms.

Don't know if I have read this correctly but, in 1929 we seem to have fell headlong into a global financial crash. By some accounts this was precipitated by a squeeze in credit, after a period of then unprecedented loosening.

Now, after a long period of totally irresponsible expansion of credit, we seem to be headed into a global financial crash, caused by a credit squeeze. Much of what we call our financial system is now a gigantic, leveraged mountain of debt, most of which can never be repaid. This could make the "Great Depression" look like a "market correction".

Anyone noticed a particular theme in the mainstream news media, where they seem to be telling us that things are getting worse, except that there is an increasing delay in their feeding us this news?

It's almost like when there's been a death in the family and someone has been nominated to break the bad news.

Except in this case, the reluctance to pass on the bad news is because certain parties are busy looting the remnants of the estate of the deceased.

Or am I just far too cynical and I am somehow reading this the wrong way?

[Knights of Nee]

Right now, as the CEO of an orginazation that is almost 9 TRILLION dollars in debt (add "unfunded liabilities" going forward to the tune of 76 TRILLION $$ total) with the promise to pay this debt based on future tax revunues (we borrowed all this money on behalf of tax payers, so it really isn't my organization's debt obligation anyway)from a declining cohort of tax payers (MILLIONS of baby boomers set to retire and start COLLECTING benefits), it makes perfect sense that gubment should have a role in this current environment of market "instability."

What is another few billion dollars added to this pile anyway. My job is to keep the music playing, then its off to Crawford, and I will shoot on site anyone digging for potatoes on my ranch (not me personally, the Super Secret Service pulls the trigger)

Got barbed wire?

[Yehuda Draiman, energy consultant]

The Survival of Humankind, and Improving the World, Society, and Yourself!

Yet who can the world trust to be idealistic and moral enough to help all of humanity and the environment, and at the same time, be practical enough to make extremely difficult decisions that can and will harm a great deal of people?

Humanitism is a philosophy for the continued survival and perpetuation of the human race. Humanitists (people who believe in humanitism) do not have the luxury of trying again after failing. Humanitists must be more vigilant than environmentalists, because we will not have a second chance at survival.

The survival of humanity is more important than the well being of our environment; however the environment is necessary for humanity to survive. That does not give the right for big businesses to continue doing whatever they want with only minimal or no consideration for the environment, so long as our surroundings support human life. We need to protect the environment for the continued survival and future well being of humanity. Keep in mind that without the human race, there would be no one and no need to protect the environment. Therefore, humanitism is more important than environmentalism.

It seems that in the past 50 years the human race has pursued the money train, that such desire for financial gain has caused society to ignore and abandon honesty, values, morality and candidness etc.

The race to financial gain has caused our leaders and the executives of the corporate world to disregard laws, ethics and the caring for each other and humanity as a whole. Deception, fraud and outright theft are their new motto all for the sake of financial gain, fame and success.

It seems that for the sake of success and profit people will step on anybody, family friends, co-workers and anyone who stands in their way or take advantage of anyone that could help them achieve what they want.

That is not to say that honest and compassionate people who care do not exist, where honesty and integrity is a way of life for them, but they are a very small minority.

As we begin the year 2008, we should all look at the past and decide with determination that everyone will from now on contribute to the betterment of humanity, society and mankind.

We should all learn to live with each other and respect each other for the sustainability of mankind.

Compiled by: Yehuda Draiman – 1/30/2008

PS
The human survival instinct prods us to outlast afflictions and, if circumstances permit, to reach old age. Nothing, of course, could be more quintessentially natural than aging.