finally. i wanted a full point. but i guess it is a moral victory that the Fed at least acknowledged that things are going to be F'd up all the way until Georgie is gone.

COINCIDENCE?

"The Federal Reserve, declaring that increased economic uncertainty poses risks for U.S. business growth, announced today that it has approved a half-percentage point cut in its discount rate on loans to banks"

YEAH!

There you have it!

A reward (bailout) for risky business behavior!

I mean, what else did we expect out of the "Borrow and Spend", Credit Card "conservatives" party run by the worst MBA ever!?

yea, because the fallout in the MBS markets and resulting liquidity freeze in europe and the US.... forcing the ECB and the FED to pump billions into MBS and lower the discount rate to free up some cash......

IS ALL BECAUSE OF GEORGIE.... gosh you libs are pathetic sometimes.

oh but keep pushing your congresspeople to significantly raise tarrifs on china and put the CPI up 20%... thats real good for america... idiots.

a reward bailout for risky business behavior redneckdumbass? lowering the fed funds rate is a bailout? no you dumbass, government subsidizing (major in europe) and BEGGED for by liberals in the US is a BAILOUT. dude, don't comment if you don't know what the fuck ur talking about.

......you seem to do that quite often, and nobody takes you seriously because of it. i'm sorry but its the truth. i only post on shit that i at least have somewhat of an understanding of.

IS ALL BECAUSE OF GEORGIE.... gosh you libs are pathetic sometimes.
Posted by Yodar013 at 2007-08-17 10:41 AM

YEAH!

What you say is especially ironic considering that not to long ago you all were trumpeting the "economy" the market and "home ownership" as solely due to Bush and his policies!


Or did you already forget that?

quote me dumbass. now keep quiet already.

and yes the economy is doing fine. fyi.

and yes the economy is doing fine. fyi.

unless you have to work for a living.

I am glad that the fed dropped the rate a half point though.

"and yes the economy is doing fine. fyi."

Then why does the US have to take out it's charge card to pay rent every month? If "the economy is doing fine", why are we running massive deficit budgets?

What you say is especially ironic considering that not to long ago you all were trumpeting the "economy" the market and "home ownership" as solely due to Bush and his policies!
Posted by Redneckville at 2007-08-17 10:48 AM

Um...who are you talking about when you say "all you"? Is that the conservatives? Because if that's the case, you're wrong. Most conservatives realize that while presidential policies have some effect on the market, it never goes up or down solely on government policies. It mainly moves up or down due to something called "market forces".

I ask because, based on this post and most of your others, you seem to think that there are two types of people - the Democrats (good guys) and the Republicans (bad guys). It's almost like an echo of the "you're either with us or against us" statement. But a knowledgeable person would realize that the world is not made up of black and white, but shades of grey. Remember that people can be conservative and not support Bush, or realize that the market largely moves based on world events and natural market forces, not on the policies of 1 overspending President.

BTW, do you even know what the discount rate does? Research it and then make comments. Till then, please follow Yodar's advice and refrain from commenting on issues you know nothing about.

Overall the economy is doing fine. But we're on the edge of the blade right now, and could go either way.

Fed should have moved six months ago, when the first serious cracks started to appear in housing. You could tell from the spreads on short paper that the credit markets were seizing up as early as March. Remember the Spring? When all these corporate deals and M&A's were being done, and commentators noted the "excess liquidity" sloshing around the system? Well, when dozens of companies are bought or merged totalling trillions of dollars, liquidity dries up pretty fast. That was obvious to everyone with a trading screen, should have been obvious to the Fed, and they should have moved. But they did not, and so here we are.

Then why does the US have to take out it's charge card to pay rent every month? If "the economy is doing fine", why are we running massive deficit budgets?

Posted by Danforth

i'm not going to spend a half hour explaining this. do the research yourself..... this may help: don't look at it as if the 'US HAS to take out it's charge card', look at it as: 'the us CAN take out it's charge card.'

Then why does the US have to take out it's charge card to pay rent every month? If "the economy is doing fine", why are we running massive deficit budgets?

Posted by Danforth
* * * *

Because it's more efficient to borrow the money at 4.1% for ten years, than to present a tax bill on the productive economy. This isn't news--the economy was in great shape during the Clinton years, and he still had to borrow.

Does the fact that General Electric borrow money bother you, in the same way that you lose sleep when the Federal government borrows money to build highways and ports and dams and aircraft carriers and parks? Do you picket GE headquarters for using a capital structure and debt?

"i'm not going to spend a half hour explaining this. do the research yourself.."

Bwahahahaha!

The percentage of annual federal outlay going to service the debt has grown steadily under Bush, and is currently at record levels. Spin that.

"this may help: don't look at it as if the 'US HAS to take out it's charge card', look at it as: 'the us CAN take out it's charge card.'"

You've met my ex-wife, haven't you?

RisR, yea but i think the fed wanted to punish these risky hedge fund MBS and paper investors a tad first.... teach 'em a lesson. lol i dunno.

quotes constantly heard in investment circles now:

"when the tide goes out, you see who's left naked"

and

"the market has been eating a lot of bad paper over the past few years, it just needs to vomit it up now and will feel better soon"

"Because it's more efficient to borrow the money at 4.1% for ten years, than to present a tax bill on the productive economy. "

The percentage of annual outlay servicing the debt will continue to rise and eventually choke off other options. What kind of Republican-wet-dream tax cut could we have if we'd run balanced budgets all this time?

The Dow would have to be 14,300 (adjusted for inflation) to match the 11,750 it was in 2000.

So, actually the stock market has actually lost value since 2000, right?

"Does the fact that General Electric borrow money bother you, in the same way that you lose sleep when the Federal government borrows money to build highways and ports and dams and aircraft carriers and parks?"

Apples and oranges. GE doesn't borrow money on an ongoing basis to increase dividends only to it's wealthiest owners.

(remove one 'actually' LOL)

dan, i'm still laughing at your ex-wife comment!

come on tony, stop with the partisan bs please.


"If anyone doesn't understand how detrimental Bush's economic policies and choices have been for American workers"

.... that should be: "how detrimental bush's economic policies and choices have been for a select few american workers, and have been a great benefit for the average american consumer.

....the gains to the gainers are greater than the losses to the loosers...... FIND A NEW JOB.

"Um...who are you talking about when you say "all you"?


YEAH!

The Fake Plastic "conservative" Bushiets!



and yes the economy is doing fine. fyi

YEAH!


If you consider market volatility and a 13% chance of getting your money back "fine" and having no impact on "confidence"!

And just for clarity ------- borrowing money that you can't pay back IS considered "risky" behavior

RisR, yea but i think the fed wanted to punish these risky hedge fund MBS and paper investors a tad first.... teach 'em a lesson. lol i dunno.

quotes constantly heard in investment circles now:

"when the tide goes out, you see who's left naked"

and

"the market has been eating a lot of bad paper over the past few years, it just needs to vomit it up now and will feel better soon"

Posted by Yodar013
* * * *

I'd have more respect for them if I believed that were true, but the logic doesn't follow. The subprime aspect of the mortgage business is miniscule, totalling just a few hundred billion or so. All the Fed needed to do was pass a regulation or two that would have curtailed lending in that arena, had they felt it was the case--last I checked, the Fed regulates member banks and lenders. For example, they could have simply said that CDO's aren't marginable securities--that would have put the monkey business by the hedge funds at an end, and the paper would have traded on their own merits.
But the liquidity crunch simply could not have been coming from subprime. The Fed simply set rates too high, at a level above which people were prepared to borrow. And so now the market is struggling to re-price everything that's been issued. And that ain't easy.

FIND A NEW JOB.

don't be silly, yodar. that would be too logical and realistic. besides, democrats need something to whine about.

So, actually the stock market has actually lost value since 2000, right?

Posted by AMERICANUNITY
* * * *

Not really. You have to assume that none of those companies were paying dividends all that time. You throw in a dividend yield of 3.1%, and suddenly you're in the black.
Now if you're talking about the NASDAQ companies . . .

Apples and oranges. GE doesn't borrow money on an ongoing basis to increase dividends only to it's wealthiest owners.

Posted by Danforth
* * * *

Yes they do. Who do you think controls the board of GE? Who do you think has the biggest voices in their annual stockholders meetings? The widow with 100 shares? Or the big institutions and the rich with their multi-million share lots?
You're dodging my question. GE borrows money in the capital markets to finance expansion, build their brand, increase profits. As long as it's possible to borrow at 5% and reinvest at 15%, they should do so, all day long. What's more, GE can't raise taxes to pay their interest payments.
But government accounting works differently--even though they're investing in long-term projects all the time, the fed gov't isn't allowed to issue serial bonds for that purpose, unlike, say, when the State of California wants new water systems or schools. I hate wasteful spending as much as the next guy, and Republicans are no less guilty of it than the Dems are. But the question to ask regarding deficits is how is the money being spent in the first place? If a candidate says he wants to double the size of the interstate highway system--which they should do--they should borrow all the money to make it happen.

yea but maybe bernake knew that if he kept rates high, then the combination of that and the fallout of MBS and CDOs (due to sub-prime lending) would realize themselves... i dunno.

yea rob, but going to a secondary school and training for a different career in a different sector is more difficult than sitting on your ass bitching to the gov to bail you out.

IS ALL BECAUSE OF GEORGIE

what if....

we only defended ourselves against the Taliban.

no Iraq war.

no Billions lost and lives wasted.

Greenspan also has a hand in this mess. You do not tell the American public to get an option arm and then raise rates 17 times in a row.

WAKE UP!

Bernanke didn't do this out of the kindness of his heart. He had to concede that we are in a tailspin.

yea tony, cause sweden is totally going to "reap the rewards of globalization"

RightIsRight

Would GE amass a debt equalling 3 years of revenues?

"If a candidate says he wants to double the size of the interstate highway system--which they should do--they should borrow all the money to make it happen."

What if he says he wants to double the size of the tax cuts to the wealthiest? Should he borrow to do that, too?

My point is simple: if we don't pay down our debts when "the economy is strong and getting stronger", when will we? When the twin tsunamis of Medicare and Social Security are upon us? Doubtful. And eventually, as the percentage of annual outlay to service the debt continues to rise, it will choke off other options, as it probably already has. Since you brought up the highway system, how much infrastructure repair could we do with what we spend on servicing the debt?

""FIND A NEW JOB.""

That's what lots of my friends are doing. Unfortunately though they are keeping their old jobs too. That's what millions of people are being forced to do in this wonderful Bush economy.

Oh, please..comparing the gov't to GE?

I'll agree to compare only when the US has to keep books the same way.

yea tony, cause sweden is totally going to "reap the rewards of globalization"

We aren't Sweden, are we? What is the Number One cost issue with all US-based corporations and businesses? Might it be the explosion in healthcare costs which most of the other 29 nations have some form of government-sponsored healthcare already in place, shifting the burden from individuals to society as a whole?

Isn't the operative question whether the US could get more bang for its buck even spending the same we do today if the healthcare delivery system was made more efficient for both users and providers?

If the US had to keep books the way GE must, the US debt would be closer to 30 years or revenue, not 3 years.

By the way, I'm sometimes amused to hear about the emergency that's coming from federal debt. Add up the debts of Citi, Merrill Lynch, Bank of America, and GE--and you've got over $2 trillion in debt. Just from four companies. Companies that can't raise taxes or sell parks or change laws to pay their bills--only the federal government can do that.

By the way, I'm sometimes amused to hear about the emergency that's coming from federal debt. Add up the debts of Citi, Merrill Lynch, Bank of America, and GE--and you've got over $2 trillion in debt. Just from four companies. Companies that can't raise taxes or sell parks or change laws to pay their bills--only the federal government can do that.

Danforth

I asked RightIsRight that question.....

Perhaps GE and other companies have debt that exceeds their annual revenue, but in the history of America we've never had this ratio of debt to revenues as far as I know - well, maybe after WW2, but we paid that off.

* * *

RightIsRight

Do you have a link to those GE numbers? I'd like to check them out

Thanks for your replies too

If the US had to keep books the way GE must, the US debt would be closer to 30 years or revenue, not 3 years.

Posted by Danforth
* * * *

Huh?

"Companies that can't raise taxes or sell parks or change laws to pay their bills"

No. Companies raise their prices and lay off workers

"I'm sometimes amused to hear about the emergency that's coming from federal debt"

I don't think it's currently an emergency. But the future is quite clear: the path we are on is simply unsustainable, wouldn't you agree? Something must eventually be done, and the sooner we start, the less painful it'll be. You've spoked before about Bush's once-in-a-generation opportunity with what would've actually been surplus budgets.

But what did we get instead? Tax cuts for the wealthiest, increases in discretionary spending greater than any Democrat could've dreamed, and a pair of military fiascos we'll be paying for over generations.

No, not an emergency, not yet...but Boy George certainly brought that day closer.

RightIsRight

Thanks for the link.

It's way over my head how a company who's revenues are 1/3 their debt managed to get in that much debt in the first place, and manages to make a profit in the second.

That's for people who were really good with slide rules once upon a time...

LOL

"this may help: don't look at it as if the 'US HAS to take out it's charge card', look at it as: 'the us CAN take out it's charge card.'"

my account cant be overdrawn! i still have checks!

"If the US had to keep books the way GE must, the US debt would be closer to 30 years or revenue, not 3 years."

Huh?

If a CEO has a severance package which pays him $1 million for every year of service, that million-dollar liability must be added to the company's books each year.

The US has no similar line-entries for commitments made for Medicare, Social Security, or Veteran's Benefits. If "the US" were a corporation, the liabilities would be closer to $50-75 trillion.

IS THIS ADMITTING WE ARE IN A CALAMITY?

Poole Says Only `Calamity' Would Justify Rate Cut Now (Update2)

POOLE FOR PRESIDENT 2008!

Aug. 16 (Bloomberg) -- William Poole, president of the St. Louis Federal Reserve Bank, said the subprime mortgage rout doesn't threaten U.S. economic growth, and only a ``calamity'' would justify an interest-rate cut now.

Poole, who confers regularly with regional business contacts and votes on rates at the Fed this year, said in an interview yesterday that ``no one has called up and said the sky is falling.'' The best course is for officials to assess economic figures, including the August jobs report, when they next convene on Sept. 18, he added.

The comments suggest a reduction at or before the September meeting isn't the certainty that futures traders assume. Reports this week showed increases in retail sales and industrial production in July, while exports surged the prior month. Economists predict that revised government figures will show growth in the second quarter exceeded 4 percent.

``It's premature to say this upset in the market is changing the course of the economy in any fundamental way,'' Poole, 70, said in the interview at the bank's St. Louis headquarters. ``If the Federal Reserve were to act when it turns out there is no impact, then clearly the market would say these guys really don't have the intelligence they need to have a policy actually based on solid evidence.''

PREMATURE... MMM HMM. YEP.

What color is your parachute?

spoked = spoken


Sheesh.

What I want to know is will this lowering of interest rates get real estate selling again?
Will prices stop dropping?
Or is it just a temporary, mostly symbolic move by the fed which will have little effect on the housing market???

But the future is quite clear: the path we are on is simply unsustainable, wouldn't you agree? Something must eventually be done, and the sooner we start, the less painful it'll be. You've spoked before about Bush's once-in-a-generation opportunity with what would've actually been surplus budgets.

* * * *

Well, yes and no. Surplus budgets are only a good idea if they're used in productive ways--cutting taxes, or expanding the net worth of the country, such as by building out infrastructure, new energy sources, things like that. Paying off 4% debt would be a lousy use of the money, and the markets usually agree--the years immediately following balanced budgets have ALWAYS been recessions, or severe contractions--most recently in 2001 and 2002, funny enough.

What does need doing in a hurry, I'll agree, is serious changes in entitlements, especially at Medicare. They simply have to raise the age of eligibility, and put some kind of ceiling on the benefits. Doing just Part A--bumping up the age of eligibility to 70, phased in over several years, will push out the solvency of the program by another century. By letting people know, today, that they need to plan on either working longer or saving more for the early retirement years, that's worth tens of trillions of dollars in future liabilities that can be wiped away. Americans are living longer, and living healthier longer--so why do we have a benefit program still based on actuarials from 1935? It's stupid.

But, as usual, if the lawmakers decide to procrastinate, the markets will decide for them. Just like in the last couple of weeks. The Fed resisted rate cuts until the credit markets put a gun to their head. So it is.

I'm surprised that the righties aren't squealing like stuck pigs about the fed interfering with the free market.
Shouldn't the market sort out winners and losers, not some communist Republican Administration?

The US has no similar line-entries for commitments made for Medicare, Social Security, or Veteran's Benefits. If "the US" were a corporation, the liabilities would be closer to $50-75 trillion.

Posted by Danforth
* * *

Oh. Well, if you adjust the law with the longevity of Americans, that can be cut by two thirds. And as big a number as 20 trillion sounds, that'll be our GDP in about 9 years. GDP in 1980, for example, was only 2.7 trillion. It's more than five times that now.

I'm not the biggest fan of entitlement programs, trust me. But in the US it's a manageable problem, which can NOT be said for most of Europe. There, demographics are going to destroy the programs before debt service coverage issues will ever get the chance. Go out 30 years, and the celebrated European safety net will be completely shredded. If we're talking about Europe's impending social woes, I'm on board.

Mass media and Government will not publish or listen to the countries finest opiner, Paul Craig Roberts, until its too late. The seesaw begins.

Throughout the Great Depression the Fed hurt the economy by choking the money supply and speaking endlessly in optimisitic terms. Sorta like listening to Bush talk about the "thriving economy". Instead they pander to the concerns of rich benefactors. Their job is to confuse you while the rich rob you blind.

""bumping up the age of eligibility to 70, phased in over several years, will push out the solvency of the program by another century.""

So what if millions of people in that age bracket could not find jobs with health insurance benefits.
Who cares???
Start a national health care system then raise the tax necessary to pay for it, it will still be cheaper than paying insurance companies to not insure everyone. That would enable entrepreneurs to start small companies, allow workers to change jobs more easily. It would make our job force more flexible and more productive.

What I want to know is will this lowering of interest rates get real estate selling again?
Will prices stop dropping?
Or is it just a temporary, mostly symbolic move by the fed which will have little effect on the housing market???

Posted by danni
* * * *

It'll help, but you won't notice it much there. Florida's problems run quite a bit deeper than a fifty basis point cut in borrowing rates can fix. You have massive overbuilding--which is ongoing, by the way, which just staggers the imagination--in the major metros, hitting at the exact time when population growth is reversing.

These phenomena simply aren't happening elsewhere, outside of parts of the California coast and Las Vegas. There, it seems as if the whole state is infected. I spend a lot of time in the panhandle, and it's no different there. Between astronomical insurance premiums and tax increases, I never understood why property values rose so fast in the first place. Now they're unwinding at about the same pace.

Long way of saying, the crisis will pass in the rest of the country a lot sooner than it will in Florida.

Gee thanks RisR, just what I didn't want to hear though I know you are right.

Danforth - I couldn't agree more. Considering the number of baby boomers getting ready to retire, and who could probably live for 25-30 years in retirement, as well as the fact that the so called Social Security reserve fund is invested in Treasury bonds, meaning that money has already been spent, I would consider your $50-75 trillion to be rather conservative.

feel good measure, it's nice to go into the weekend with a bit of boost. The underlying problems still exist.. a complete bailout wouldn't do any good except make a few people feel good for a short time.

"...as well as the fact that the so called Social Security reserve fund is invested in Treasury bonds, meaning that money has already been spent,..."

You mean there's no "lock box" hidden somewhere with trillions of dollars of "untouchable" Social Security cash tucked away!? WOW...I was crushed when I learned there was really no "surplus" back in the late '90's, that it was only a projected ten year surplus based upon certain events that didn't happen...and now you're telling me there's no SS money!? I would never have believed in a thousand years that our politicians in D.C. would have deceived us that way. No surplus, no lock box...who woulda ever thunk it?

1/2 point may temporarily pacify, but this is what is REALLY going on:

People are going to continue to lose their homes over the next two calendar years at an alarming rate.

At what point do the banks take extreme pro-active measures. The banks do not want to own a bunch of POS properties with little or no equity. They are a drain of time, money and resources.

Having said that, what is the magic number? How many foreclosures REO's have to happen before someone "upstairs" is notified and told we are in crisis mode?

What loan or bastardized version of a loan will be put together to help the little guy stay in his house because one more REO would turn the banks business model around?

gonna be interesting. fer sure.

Jest - Really sucks doesn't it. And both parties are equally to blame.

Just,

Interesting though, it was the republicans who open the box and began the theft.

Can someone explain to me how the rich are robbing me blind in our current economy?

It's about darn time!!!!

The cut in the loan discount rate is a start but the Fed HAS TO to lower the federal funds rate. Greenspan started this nightmare with something like 11 or 12 straight interest rate hikes. It was beyond irresponsible and just plane moronic. I saw this coming 2 years ago because the rate hikes were too aggressive.

The word on the street is that the loan discount rate cut is a precursor to the Fed cutting the more important federal funds rate at its next meeting in September as well as cuts in October and December. The Fed killed the housing market and these rates also affected the interest rates charged on credit cards and other types of loans so they have to make things right.

Money - There never was a box. It was a ponsi schema from the moment the democrats (FDR) created it.

They immediately started paying retirement benefits to people who never contributed, while collecting and spending taxes from working people in exchange for a future promise. It was an unfunded liability from day one.

But that said, I still think both parties share equal blame for allowing it to continue.

" it was only a projected ten year surplus based upon certain events that didn't happen"

One of those events that "didn't happen" was keeping dividends taxed at the same rate as, say, unemployment. Instead, everyone making over $350,000 a year got a 60% federal income tax reduction on dividend income, at a max rate of 15%. Unemployment got no such break: it's taxed as high as 35%.

Well, the benefit is a greater inventory of housing. In a local paper, it indicated that at the current rate of sales, the current inventory of homes for sale here would require some six years to sell, if none were added.

Another local paper indicated that the local market was "good," whatever that was supposed to mean.

During the Great Depression, mortgages required bank foreclosure, so people could live in their homes for years before being foreclosed. As a remedy, the trust deed was created, and now it's a non-judicial procedure unless the lender also wants to claim back payments. So, there is expedited eviction available.

That means more homes on the market. Rental rates should decrease.

Another consequence is that since a home is sold on the average after seven years, people relocating because of employment, may need to pay double mortgages, or mortgages and rent, since they can't sell their homes.

A "remedy" may be the issuance of government supported fixed rate mortgages at a low interest rate, possibly 4 1/2% for existing homeowners, together with removal of the clause providing for acceleration upon sale.

This would save the lenders. And this would avoid displacement of those otherwise defaulting on their mortgages.

Save the American economy. Socialize mortages. Wait. Some candidate will suggest this.

Calm down, the stock and home markets have ups and downs. I am old enough to have seen a few of them. If you are sufficiently diversified it will all work out in the wash. Hell, I retire in 2 months and I'm not worried. Have a cocktail and take a deep breath.

Unemployment got no such break: it's taxed as high as 35%.

Posted by Danforth
* * * *

LOL, sure. Assuming that the unemployed person somehow finds himself in the highest tax bracket. Which means that a married unemployed person would have to be making, what?, $350,000 or so for his unemployment check to be taxable at the 35% rate?

Wow. Who knew that staying home and picking up government benefit checks could be so lucrative? Are there any openings there?

This rate cut by the Fed speaks volumes about what the people in the know really believe is going on with the US economy. And obviously it is not good. Now rightwingers can deflect and play down the significance or minimize, but cutting the rate at this time can only mean that concerns about the housing mortgage market are on red alert.

"LOL, sure. Assuming that the unemployed person somehow finds himself in the highest tax bracket."

My bad...executives never get laid off...riiiiiiiight.

The point remains: his unemployment is taxed at more than double the rate of his dividends, or the dividends of anyone else in the top bracket. What had been a federal rate of 38.5% was cut to 15%. That's a rate reduction of over 60%. Yet unemployment is taxed at regular income rates.

RIR makes a great point they should have done this 6 months ago and they might have but everyone on the right had been saying that everything is fine, dont worry, the economy is strong, and not weaking at all, it's a top accomplishment Bushs term. When in fact it was weakening and needed help but again the government waited to long to "change course". It seems to happen a lot since bush has been president that's why i blame him. As Trueman said "The Buck Stops Here" and i execpt the president to take responibility for not acting right away. Isnt that a leader does? You want to say it is no ones fault, I dont buy that. Bush should have moved 6 months ago but didnt. He is the leader of this country, and a leader needs to lead Bush has been reactting not leading it both Iraq and in this case. I believe his ego and politics took first priority again over the best interest of the country.

One way to see it. Another is that the dividends is a source of income that has already been taxed once, at the corporate rate. Suppose you're the owner of a company stock, and your share of its income is $1000. Suppose it's a big company, whose tax rate is 35%. So now the income distributable to shareholders is $6,500. Even if you assume a dividend payout ratio of 100% (maybe it's a utility, or one of the income partnerships that were rolled up to be publicly traded corporations)--you're going to get whacked again, this time by another 15%, or over $900. So by the time it's all said and done, your effective total tax bill is over 60%.

But maybe that's not enough. So let's be sure to tack on whatever state and local income taxes you'll be paying, and you'll see that in many places in the country the combined tax rate on corporate income is over 70%. Which helps to explain the flight of corporations--and people--to lower-tax climes.

When in fact it was weakening and needed help but again the government waited to long to "change course". It seems to happen a lot since bush has been president that's why i blame him. As Trueman said "The Buck Stops Here" and i execpt the president to take responibility for not acting right away. Isnt that a leader does? You want to say it is no ones fault, I dont buy that. Bush should have moved 6 months ago but didnt. He is the leader of this country, and a leader needs to lead Bush has been reactting not leading it both Iraq and in this case. I believe his ego and politics took first priority again over the best interest of the country.

Posted by Fenderwa41
* * * *

Bush has no influence whatsoever on the actions of the Fed. Nor should the president, ever. And neither did Truman.

Bush has no influence whatsoever on the actions of the Fed. Nor should the president, ever.

Bull, RIR. Why do you think its called the "Bully Pulpit"? While directly you're 100% correct, Presidents have influenced the Fed since day one.

"Bush has no influence whatsoever on the actions of the Fed. Nor should the president, ever. "

Bush changed his campaign slogan from "you deserve a tax cut, because it's your money", to "you deserve a tax cut, because we're in a recession. If jawbowning for months helped the recession begin in March 2003, certainly tax cuts and massive spending & deficits can force the Fed's hand, eventually.

Bush has no influence whatsoever on the actions of the Fed. Nor should the president, ever.

What was the first act by Johnson after Kennedy was killed?

Something about removing a Presidential executive order. (hint)

While directly you're 100% correct, Presidents have influenced the Fed since day one.

Posted by tonyroma
* * * *

Give me one example.

Well, for one, duh, the President appoints the members of the Fed. I think that gives him a leetle bit of influence in terms of the types philosophy/social /politics which gets onto the board in the first place.

Give me one example.

There are two right above your post. And track the Fed's manipulation of rates prior to key elections in order to help the party of the President. Do you think this just happens by accident?

So you are telling me that Bush say six months ago "i see trouble here i feel we need to adress this problem" in a news conference and nothing would have happened???? I dont think so. And be honest niether do you RIR. The president is a starting Gun for issues like this. Just by standing up and Leading he could have effected the outcome. But he would have had to admit there was a problem first. Which is not a strength of any politician not just Bush, But Bush is one of the worst offenders in my mind.

LOL. OK, Tony.

We've just seen 17 increases in the overnight rate in a row. Would've been nice to have had a few just before last November, wouldn't it?

Do you happen to have a chart or something that shows the timing of Fed easing has coincided with the President's re-election? Because I'm sitting right now in front of the most advanced trading screens on earth, and it ain't there. So let's look at it just anecdotally--the Fed easing in 2000 was in anticipation of the Y2K "problem", which would have helped Gore. There was no easing in 2004, in fact the opposite. More tightening in 2006.

Going back, Fed tightening in 1980 by Volcker, Carter lost. More tightening in 1982, Senate lost to the Dems by Reagan's party. Easing in '84, then tightening again in early 1988 following an easing in '87 in reaction to the crash then--Bush wins, though he shouldn't have, in your thesis. Bush loses re-election in 1992, while the Fed sat on their hands. Then more easing throughout the rest of the 1990's, which--somehow--corresponded with Republicans taking the Senate and House from the President's party.

So what point were you trying to make again?

Give it up RIR. The President, no what party he/she is from, always has a huge influence on the Fed. Sometimes the Fed ignores the will of the prez, but they are always taking into account what he is saying.

Bush changed his campaign slogan from "you deserve a tax cut, because it's your money", to "you deserve a tax cut, because we're in a recession. If jawbowning for months helped the recession begin in March 2003, certainly tax cuts and massive spending & deficits can force the Fed's hand, eventually.

Posted by Danforth
* * * *

We were never in a recession under Bush's terms. So what are you talking about?

Easing in '84

Republican landslide.

Then more easing throughout the rest of the 1990's, which--somehow--corresponded with Republicans taking the Senate and House from the President's party.

And the greatest budget surplus in the history of this nation.

Go back and re-read. I did not say presidential elections, I said key elections and while every election isn't one, Presidents put pressure on the Fed whenever it suits the political needs of their parties.

Let's work in the converse. Are you saying that Presidents have no actual sway whatsoever over the policies of the FRB?

Are libs stupid? The President has no control of over the Fed!!!!! While he was nominated by Reagan for the Chairman post, he was nominated again by Bush 43, Clinton and Bush 41.

It was the Fed that went out of control and made all those consecutive interest rates hikes. Imagine if you signed a veriable interest rate loan and then good old Greenspan yanked up the base rate 12 times in succession. That is the main reason so many people are screwed with those subprime loans. Now Bernanke has to clean up the mess.

We were never in a recession under Bush's terms. So what are you talking about?

Really?


The Early 2000s recession was felt in mostly Western countries, affecting the European Union mostly during 2000 and 2001 and the United States mostly in 2002 and 2003.

What do you call this?

Bush and Vice President Dick Cheney, in separate speeches Wednesday, both claimed the U.S. economy was already in recession when they were inaugurated in January 2001, implying the blame for the slowdown rested on President Clinton's shoulders.

You must be one who believes this too!

Are libs stupid? The President has no control of over the Fed!!!!!

Oh...so appointing his own people to the Board itself doesn't amount to any influence whatsoever, huh? Do you feel the same way about Supreme Court nominees? Your point sounds just as nonsensical!

And by the way, the term is influence not control! Try and pick up your reading comprehension, will you?

One can have influence without having control, but one cannot have control without having influence....

a reward bailout for risky business behavior redneckdumbass?
Yeah rednect SFB!

this is the price we pay for giving credit to "underpriviledged"(e.g. those will bad credit history and no financial responsibility) in order to get them off the public dole. You can have your tricked out escalade and a new house. Don't worry about paying for it. You know you got to have it.

"Oh...so appointing his own people to the Board itself doesn't amount to any influence whatsoever, huh?"

Nnot if the man wants to do his job. UTA is right -- the president has zero influence over the fed. Historically, there has never been a hint of political influence as the fed did its job.

Or are you weaving a conspiracy that perhaps the fed is getting some sort of under the table benefit from Bush?

Goatman says Uta is right? LOL. When one idiot agrees with another idiot that does not mean either idiot is anywhere close to correct.

When one idiot agrees with another idiot that does "not mean either idiot is anywhere close to correct."

As when you and buffalo bob and Larry agree? Good point. I've noticed you don't even need corroboration to be wildy wrong, m8.

"We were never in a recession under Bush's terms. So what are you talking about?"

Well, the actual definition of recession, for starters: two consecutive contracting quarters. The recession began in March 2001, much to the disagreement of Bush, who claimed as early as November 2000 we were in a recession.

recession
noun
1. the state of the economy declines; a widespread decline in the GDP and employment and trade lasting from six months to a year.

http:// dictionary.reference.com/ browse/recession

Danfort is totally correct. If the Government reported numbers like the private sector is required to do.....it'd be a much bleaker picture.

What the fed did today was try to alleviate a severe cash crunch crisis at the main broker/dealers and money center banks. Almost agin to the famed "helicopter drop". Tbills have dropped from 5.1 to 3.6 in one week, one of the largest % drops EVER. World markets are strapped.......

The President has no control of over the Fed!!!!!

I agree. Because you are assuming he knows how to add and subtract.

However, someone behind the scenes that 41 has lurking in the background controls the Fed.

If you think that the good ol boy network stops short of the Fed you sir are sadly mistaken. Bernanke wouldn't have gotten the job if he wasn't a yes man.

Oh.

""this is the price we pay for giving credit to "underpriviledged"

What is this costing you Slickster???
They lowered interest rates one half point and you immediately start blaming the welfare crowd.
You are hilarious.

FF for Goatman on his 5:29.

While I have forgotten most of my macroeconomics and financial markets from my econ degree in the mid 80's, most of what RiR is saying is consistent with what I understand about the markets.

As always, I try to defer to the people who actually work in a particular field as to the impact this particular rate cut has, but from my discussions with bankers, investment bankers and economists over the past several days, this cut only serves to calm the credit markets to assure them that there is liquidity in the system, and will have no impact on the Fed Funds rate or the sub-prime market correction that will have to play its course in the near future.

Let's work in the converse. Are you saying that Presidents have no actual sway whatsoever over the policies of the FRB?

Posted by tonyroma
* * * *

Yes.

Do does the FRB therefore have sway over the WH?

Do = So

A surprising 94 percent of Americans say they are satisfied with their lives

to

So George Bush's economy has 94% of Americans satisfied with their lives and you low-life Dems are bashing him?

I don't understand how he got from the question of life satisfaction to satisfied with the economy.

Maybe how 94% of ethopians are satisfied with their lives...

"how he got"

I seem to recall it claimed to be female.
At best a mediocre troll, in any case.

So less than 2% of mortgages are in trouble and heading towards foreclosure.

That means 98% of the folks are paying their loans on time and without problems.

Can someone give the short answer as to why the Feds just press the print button and push money into the market and this is supposed to help?

This doesn't seem to be the right way to fix this particular market problem.

Why don't they just lower the interest rate a half point and folks can get back to a payment they can afford?

There would certainly be less foreclosures--right?

Pushing gobs of money into the system would likely cause another problem to arise--like inflation or something?

Murphy

And the mortgage lenders did this to themselves by giving out gobs of money to folks who were not credit worthy.

That is why there are about a dozen or more lenders in the subprime market who have gone belly up--making bad decisions.

Murphy

"Can someone give the short answer"

Easy...if oil supplies decreased by 2%, would prices rise by only 2%?

Why or why not?

Murphy- Greenspan encouraged people to make these loans. Then the fed kicked their ass.

"a dozen or more lenders in the subprime market who have gone belly up"

Of course, they got their fees up front, right...? And despite the fact the "homeowners" have nothing left, the lender's knowing scam has met it's payroll since...when?

All in all, a transfer of value from those unable to actually afford these sub-prime mortgages to the vultures who began preying as soon as the laws opened up the floodgates. I blame the predators but I also blame the lawmakers who have purposefully made the balance unfair.

Though truly, it's a crossroads question: do you exploit the unknowing, or protect them?

We the people pay for every dime that goes into the system.
Every loan that is made, every "boost" to the liquidity, every thing.
The money is "created" out of thin air. And we the people pay 6 cents for every "debt" instrument that gets printed.
Funny how all these profit producing corporations cannot seem to cover their plays without the citizens bailing them out.
The only benefit with a cut in the discount rate goes to corporations.

being able to see the road ahead is impossible when you spend all day looking in the rear view mirror.

Wow. Gitmboy's a retard.

Wow. Gitmboy's a retard.

Gitmboy is a patriot in the truist sense of the word. He believes that liberty should never be compromised by government, and that government exists to serve the people, not the other way around.

Gitmboy is a patriot in the truist sense of the word. He believes that liberty should never be compromised by government, and that government exists to serve the people, not the other way around.

wow, you read that into his limited, cynical thoughts?

I see gitmboy as an anti-white, anti-capitalist.

Just my point-of-view.

I could be wrong. I've just read his comments from today.

He apparently also believes that rhetoric should never be compromised by education. The idea that when a debt is created, we run out and print up a bunch of money for six cents apiece is just silly. Further, to characterize a Fed move to increase liquidity as "citizens bailing out" corporations is equally preposterous.
He has TonyRoma fooled, though.

i see alot of people on thr right calling the libs stupid becuase they claim the president has no influence over the Fed. But non of you answered my Question. If Bush six months ago made a speech saying he had concerns about this, you are all telling me nothing would have happened? I think you are all smarter then that. But i would love to hear your answers anyways. So let me hear what you think would have happened had he been a leader and voiced his concerns 6 months ago when this should have happened.

Bush and the Congress could have done things legislatively to have shut down some of the subprime mortgage lending. But he--nor anyone--can say, "I think interest rates are too high", then watch as the Federal Reserve Board snaps to attention and starts lowering rates. It doesn't work that way. I realize I'm on a board where everyone likes to believe that Bush and Rove and Cheney are behind every little thing, but it's just stupid. The credit markets are so vast and enormous, and many factors go into what gives them its direction. You would be surprised to hear how little influence even the Fed has--in fact, on maturities of more that 24 months, it's zero. Imagine that--the organization responsible to monitor and make markets has no control over the mid- to long-range portion of the yield curve. But there ya go.