28. Hold On to Your Wallets and Purses

09/14/2009

Woof - Check out the Internet! A special keyboard to accommodate my paws and I’m a high tech reader!

The Good and the Bad in the latest announcements of President Obama’s plan to attack the economic problems are highlighted at the following site pages:

http://www.marketwatch.com/story/obama-calls-for-common-sense-financial-rules-2009-09-14-12600?siteid=yahoomy

http://news.yahoo.com/s/ap/20090914/ap_on_bi_ge/us_obama_financial_regulations;_ylc=X3oDMTI1%20NzZyc3Q3BFJfYWlkAwRSX2RtbgN5YWhvby5jb20EUl9maWQDYmRhMGMzMzU0NTFiYmY2YjY0Y2Q0MWRlYjBiYWRlNDYEUl9sdHADMQ--

The Good News? Looks like President Obama learned something from history and wants to stop the intervention of bailouts. Even his new regulatory plans don’t seem too obtrusive: “The administration is proposing a new consumer financial protection agency to enforce rules about transparency and accountability, and wants to require firms to hold more capital and have greater liquidity, among other things.” But, how about regulating Government intervention (see Blog 26)? As far as holding more capital – wouldn’t that stifle growth even more when they need to grow to increase jobs and lower unemployment? Will he pressure the Federal Reserve to raise bank reserve percentages, which would lower their potential to increase credit to already strapped small businesses? Time out – let’s think this one over.

The Bad News! He didn’t learn anything about identifying CAUSES vs. SYMPTOMS. To blame Wall Street for the crisis is to identify a symptom as the cause. The Free-market was manipulated and mislead by Government actions as addressed in Blog 26 which are much more convincing as the CAUSE. Add to the badness Barney Frank who is the one who began the chaos by pressuring Fannie Mae to lower its restrictions as indicated in blog 26.

http://americaswatchtower.com/2008/09/17/barney-frank-and-chuck-schumers-role-the-fannie-mae-failure/ supports that and exposes Barney Frank as a major CAUSE of the Fannie Mae failure:

"In fact, Frank & Co. made matters worse by pushing Fannie Mae and Freddie Mac to take on greater risk. They wanted more loans to people who might not qualify for traditional bank financing. And, as The Wall Street Journal has pointed out, Frank “pressured regulators to ease up on their capital requirements — which now means taxpayers will have to make up that capital shortfall.”

"Common sense rules of the road do not hinder the markets but make them stronger," Obama said in http://www.marketwatch.com/story/story/rescue?SourceUrl=http%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fobama-calls-for-common-sense-financial-rules-2009-09-14-%252012600%3Fsiteid%3Dyahoomy..

I agree, but my Common Scents are based on facts and overall effects on the economy, as should his. I see some listening, but still most of the jibber jabber is coming from his clowns who are too egocentric to look at the full picture. I don’t feel this type of listening will create wisdom. Let’s hope his, yet another, speech tonight won’t dwell on symptoms during the Credit Crisis and blame to something other than Government intervention starting in the Clinton days, thanks to the help of Barney Frank. Maybe he’ll read Blog 26 to understand the causes and then read Blog 27 to learn how to get out of the mess. I could be wrong, but if I’m wrong, then so were Harding, Coolidge, Kennedy, Clinton, and Bush who all led us out of a hole successfully. You make the call.