Hallelujah, Praise the Free Market…

Today, Federal Reserve Chairman Ben Bernanke promised investors and Americans that the recession would probably end this year because “regulators aren’t planning to nationalize banks..”

Upon getting this news, stocks immediately jumped:

The news alleviated some of investors’ worries about the economy and the banking system, and lifted the Dow Jones industrial average and Standard & Poor’s 500 index off their lowest levels since 1997.

Next thing you know, Bernanke will be back to tell us how important tax cuts are to the economy.

Judging by the stocks rally today, we all see America’s opinion on the nationalization of any industry. 

Hopefully President Obama will pay attention.

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37 thoughts on “Hallelujah, Praise the Free Market…

  1. I did not see Obama’s speech last night. But as of 8AM PST the stock market is down 174 points.

    I saw most of Gov. Bobby Jindal’s response. That man is going to be our next president. He’s got game for it. He was wonderful. He hit a grand slam home run last night. In four years the White House will be his new home.

    We can ednure this lame duck Obama. It’s only four years. We’ll get ourselves a real president in 2012 instead of the fake one we have now.

  2. “That man is going to be our next president.”

    Nah, he doesn’t quite cause rage like Palin does among the left. Maybe that will be our major split-down debate in the next few years, John.

  3. Well he sure has Flair and plenty of it. When he becomes the front runner he’ll cause plenty of rage among the left. They will rage.

  4. “Hello Gays,

    Is the US in a Depression?”

    I’m not depressed. I’m a little tired, perhaps. I worked 14 hours today, had to transfer a significant amount from my savings yesterday to pay my mortgage for March, my car payment, and my utilities.

    No, not counting on bailouts or unions on my end. That’s good enough for me.

    Thanks for your concern, fellow-gay. (that’s just an assumption.)

  5. “I saw most of Gov. Bobby Jindal’s response. That man is going to be our next president. He’s got game for it. He was wonderful. He hit a grand slam home run last night. In four years the White House will be his new home.”

    First of all, I think Mitt Romney will be your nominee. He won’t win the general, but I’m pretty sure he’ll be your nominee. As far as Jindal goes, he’s a tool. He thinks he’s smart by refusing money to extend unemployment benefits to people who desperately need it. Sounds like a true con(servative) though. Here’s his ridiculous excuse: payments to the unemployed of the state would mean, when the economy returns to expansion, that the state would have to increase unemployment insurance taxes and payments to the US average, scaring away new employers.

    Here’s my gripe: what new employers? Is Microsoft is based in Bogalusa? Louisiana has the third highest poverty rate in the country, and he wants to deny UI benefits? He’s lucky he took office just last year, because if he were up for reelection any time soon, he’d have a lot to worry about.

    Here’s another problem I have with his idiotic stance: his state has the fourth lowest per capita income in the nation. So, it’s already been established that they’re pretty poor. So, how’s their commitment to education, the cornerstone of financial success? Louisiana is the fifth worst state in kid’s math scores.

    So, in essence, the state pretty much sucks, all the way around. And this jerk off’s solution is to refuse money for his own constituents drowning in this economy? I find it ironic that it was Louisiana that long ago led the nation in social reform, whose governor, in 1932, led the national fight to create a program now known as “unemployment insurance.”  Go figure…

  6. “Here’s his ridiculous excuse: payments to the unemployed of the state would mean, when the economy returns to expansion, that the state would have to increase unemployment insurance taxes and payments to the US average, scaring away new employers.”

    His reasoning makes perfect sense to me. There won’t be any new employers if they have to lock in with a 6.2% Unemployment Rate from day one.

    Unemployment insurnace is supposed to be a temporary form of assistance. It is not supposed to be a lifestyle. If a person can’t find a job before his or her benefits run out, then that person needs to draw down savings until a new job is found.

    If you keep on giving people extensions on their unemployment then they have less of an incentive to find a new job. Why look hard for work when the government will pay you not to? It’s that easy. It’s that simple. Even a 5th grader understands it.

    The best way to make unemployment insurance work is to keep benefits from starting until a person has been out of work for more than 26 weeks. If more people had to subsidize their own unemployment then there would be fewer people out of work.

  7. “His reasoning makes perfect sense to me. There won’t be any new employers if they have to lock in with a 6.2% Unemployment Rate from day one.”

    Oh yeah, God forbid they be on par with the rest of the country.

    “Unemployment insurnace [sic] is supposed to be a temporary form of assistance. It is not supposed to be a lifestyle”

    Aren’t you people mimicking the same excuse for not wanting welfare? Let’s try this route: what worker protections and/or safety nets DO you think are a good idea?

    “If you keep on giving people extensions on their unemployment then they have less of an incentive to find a new job. Why look hard for work when the government will pay you not to? It’s that easy. It’s that simple. Even a 5th grader understands it.”

    Um, yeah, a 5th grader also understands that this is the worst recession since Reagan, and that there are no jobs, new or otherwise, so the standard right wing talking point about de-incentivizing goes right out the window. Because everyone, everyone is looking for a job. Plus, I’m not sure if you realize how unemployment insurance works, but you’re given a sheet on which to jot down the names and phone numbers of people you’ve spoken to in regards to employment opportunities, and the unemployment office requires that it be submitted every week a claim is filed, so it’s not like someone can collect it and then sit around. Not only that, but the mere fact that unemployment is being collected should tell you that they obviously work (or at least did). But, I understand you wanting to cling to this nonsensical notion that everyone but you is just plain lazy.

    “The best way to make unemployment insurance work is to keep benefits from starting until a person has been out of work for more than 26 weeks. If more people had to subsidize their own unemployment then there would be fewer people out of work.”

    26 months, are you out of your mind? Do you have some idea what can happen in 6 months? People lose their homes, John. They lose the ability to take their kids to a doctor if they get sick. All I can say is thank Christ that people like you are not in charge of these types of programs…

  8. “26 months, are you out of your mind? Do you have some idea what can happen in 6 months? People lose their homes, John. They lose the ability to take their kids to a doctor if they get sick. All I can say is thank Christ that people like you are not in charge of these types of programs…”

    You are forgetting one thing Robert. When the rules change people adapt. If people know they can’t get unemployment for 26 weeks then they will save up money for the future in case they lose their jobs.

  9. “Unemployment is lower in LA than it is in the US. Y0u might want to check your figures.”

    Well, seeing as how I didn’t mention anything about the unemploymewnt rate, you might want to check what is you’re reading the next time I post something.

  10. “Um, yeah, a 5th grader also understands that this is the worst recession since Reagan, and that there are no jobs, new or otherwise,…”

    Huh? No jobs new or otherwise? I guess I am working some kind of imaginary job with imaginary clients and getting paid with imaginary money.

    I guess the Walgreen’s next to where I live has an imaginary Help Wanted sign up for no reason.

    Now…if someone was making $35 per hour at a job that should only pay half of that, then you are right, there are probably no jobs like that. Then again, there never should have been jobs like that. You get paid what the job IS worth not what you or your union demand what it should be worth.

  11. “Huh? No jobs new or otherwise? I guess I am working some kind of imaginary job with imaginary clients and getting paid with imaginary money.”

    Wow, John, you’re just wrong all over the place. By new jobs, I meant new industry and/or new retail or commercial jobs coming to any given town. But a 5th grader could have also figured that out…

    “Now…if someone was making $35 per hour at a job that should only pay half of that, then you are right, there are probably no jobs like that. Then again, there never should have been jobs like that. You get paid what the job IS worth not what you or your union demand what it should be worth.”

    Now, that’s interesting. Weren’t you one of the folks arguing for CEO pay being 400 times what everyone else make? Weren’t you up on your soap box chiding me, asking who am I to say how much is too much, and defending the outrageous pay of business men in monkey suits? It’s kind of funny how the tables turn, and we can actually see where your loyalties lie. Now it’s a huge deal that someone makes $35 an hour. Oh my God, we can’t have that! If you really believed that the job should pay what it is worth, you’d have taken the exact opposite approach the last time we had this conversation. You’re right, John the job should pay what it’s worth, and in your example, it does. It should NOT be paid however much you think you can fleece out of your employees, like CEOs do. You’re on the complete wrong side of the fence here buddy…

  12. Oh, I also forgot to mention how hilarious it was that FOX News called Bobby Jindal’s response (to Obama’s speech) was “Childish, amateur, and weak” FOX News! And that’s your next president?!

    Classic. Love it!

  13. “You’re on the complete wrong side of the fence here buddy…”

    If you need people to bag groceries, then there are millions of people who can do that job. That’s why that job doesn’t pay millions per year.

    Running a multi-national bank requires a skill set that very few people possess. If thousands of people possessed this skill, then CEO pay would be much lower.

    Don’t be so quick to knock to something you’ve never done or can’t do. I once worked a job that paid $5 per hour and I could do it in my sleep. The job paid that rate of pay because that is all it was worth.

    I have no trouble with someone making $35 per hour as long as the skill set is something millions of people can’t do. On the other hand Robert, you and your Living Wage types think everyone should make $35 a hour even if all they do is answer telephones all day and have no desire to move up to bigger and better things.

  14. “Oh, I also forgot to mention how hilarious it was that FOX News called Bobby Jindal’s response (to Obama’s speech) was “Childish, amateur, and weak” FOX News! And that’s your next president?!

    Classic. Love it!”

    Even Elvis sang out of tune. One perceived gaffe by Fox News does not wreck a bid.

    What I do know is your Obama is out in four. If the military had any sense he’d be out now.

  15. “Running a multi-national bank requires a skill set that very few people possess. If thousands of people possessed this skill, then CEO pay would be much lower.”

    Thousands of people do possess that “skill”. How many of those banks do you think were ran into the ground by twenty something know nothings? Perhaps not CEOs, but certainly upper management, where VP titles are handed out like Halloween candy. And what exactly did that skill set get us, John? Nearly a trillion of our dollars, that’s what. CEO pay SHOULD be much lower. In the 1970s, the average CEO pay was 90 times what the average worker’s was, now it’s somewhere around 400 times. Do you honestly believe that this “skill set” you speak of has changed that drastically? If you can answer that question honestly, you’ll see where your priorities should lie.

    “I have no trouble with someone making $35 per hour as long as the skill set is something millions of people can’t do. On the other hand Robert, you and your Living Wage types think everyone should make $35 a hour even if all they do is answer telephones all day and have no desire to move up to bigger and better things.”

    Well, thanks for making an assumption on my position. Of course you are wrong. But doing something like working in an auto manufacturing plant, where safety and even lives are at risk is something that warrants $28 per hour (not $75, not $60, not $35). If you think you can do it in your sleep, I‘d like to see that. You people are always deriding people that do real, honest, hard work, trying to find ways to pay them as little as possible, while siding with the suits who sit in cushy offices pushing pencils around all day while getting paid extremely inordinate amounts of money. If you can’t see that it’s the people who sweat and bleed their jobs are what built this country, NOT some prick in a suit, then you’re completely hopeless…

  16. “What I do know is your Obama is out in four. If the military had any sense he’d be out now.”

    Yeah? I bet you’re dead wrong. I don’t know anyone outside of this forum that’s willing to go back to the policies of George W. Bush, and embrace the things that put us where we are today. Have fun with your delusions, though…

  17. “In the 1970s, the average CEO pay was 90 times what the average worker’s was, now it’s somewhere around 400 times. Do you honestly believe that this “skill set” you speak of has changed that drastically? If you can answer that question honestly, you’ll see where your priorities should lie.”

    Here is where my priorities lie. This 90 times number or this 400 times number means nothing to me. Here is why.

    Let’s say a woman records a CD of songs she wrote. The CD’s sell for $15.99 a pop. People love her voice, love her song writing, and love her musical style. She sells 10 million copies of that CD. She earns a royalty of $2.50 per CD.

    Her haul for her effort is $25 million dollars.

    The critics don’t like her CD. It receives horrible reviews. The awards associations that hand out things like the Grammys do not nominate her CD for any awards. That doesn’t matter I guess. She still has her $25 million on one less trophy or two to dust.

    Meanwhile across the country another woman also writes songs and sings. She writes and sings the same kind of music our above singer writes and sings. Her CD doesn’t do as well. She earns royalties at a rate of $2.50 per CD and brings in $62,500. That exactly 400 times less than the above singer. She sold a paltry 25,000 copies of her CD. But there is some consolation, the music critics love it.

    So does singer number 1 deserve to make 400 times more than singer number 2? They both worked for their money. They both probably worked very hard.

    One could argue singer number one is a failure because people who understand music don’t like her CD. She is being rewarded for failure by a public that has no sense of what good music is.

    One could argue singer number two is failure. Critical acclaim wasn’t any significant help.

    But I guess according to some people singer number one should be limited in what she earns or be taxed to the point where she is left with what singer number 2 earned. I am not one of those people.

    Why did I post all of this? I’d like to see how far this need to control how much people make goes.

    Now getting back to banking Robert, things have changed since the 1970’s in the banking world. Insterstate banking was illegal. Banks were required to be banks only. They were not allowed to sell insurance and own brokerage firms. The world of banking changed and the skill set to accomodate it went up.

  18. “Why did I post all of this?”

    That’s a very good question, and one I was going to ask. Thanks for wasting forty seconds of my life. That was a horrible analogy to make. For one, those singers are being rewarded monetarily for their creativity. They are not hired to do a job. They have something that they shop around and that the public may want. What they offer is arguably not a service. They essentially gave the world something from their hearts, which the public could take or leave. It is completely different from a bank CEO, whose primary function is to engage in fair and lawful lending of money. They very clearly could not and did not perform that function. You want to talk about rewarding failure, then look no further than the men you defend who are essentially being rewarded for their incompetence. At the very least, they should no longer have jobs.

    “Now getting back to banking Robert, things have changed since the 1970’s in the banking world”

    My statistic was not exclusive to banking in any way, but I don’t expect you to deviate from your standard rant.

    “Banks were required to be banks only. They were not allowed to sell insurance and own brokerage firms. The world of banking changed and the skill set to accomodate [sic] it went up”

    If I go to a casino in Vegas right now, and throw what little money I have on a roulette table, it does not constitute a skill. Getting away with naked short selling and dealing in derivatives is similarly not a skill. Laws were put into place after the Depression to curb this very type of behavior. It’s a piss poor defense of an industry that rewarded bad behavior.

  19. “I bet you’re dead wrong. I don’t know anyone outside of this forum that’s willing to go back to the policies of George W. Bush, and embrace the things that put us where we are today.”

    First go to Bill Clinton, then get back to me.

    Bush’s economic policies may have been horrid, but a number of Republicans didn’t like them. Why do you think registered Republicans largely stayed home during this election? McCain was banging the Bush-economy drum and they didn’t want more of that. If the next conservative on the ticket is able to prove that their policy is nothing like Bush’s, Obama will be kicked to the curb–just like Carter.

    We wanted change. We’re getting Clinton’s old buddies and Bush economic policies on freakin’ steroids. I hate to break it to ya, but when you vote for change without specifying what kind of change you want, this is exactly what you get.

  20. “If I go to a casino in Vegas right now, and throw what little money I have on a roulette table, it does not constitute a skill. ”

    If that is how you handle it then you are right. But if you watch the previous numbers spun then you might be able to make a more intelligent bet.

    As for the bankers, fine, castigate them all you want. Now what about all of those people who bought real estate they could not afford? They will get away with that.

  21. “I bet you’re dead wrong. I don’t know anyone outside of this forum that’s willing to go back to the policies of George W. Bush, and embrace the things that put us where we are today.”

    I agree. I really miss airplanes flying into buldings and killing thousands of people. Don’t you?

    I abhor Bush’s economic policies but I applaud him for keeping us safe.

  22. “We wanted change. We’re getting Clinton’s old buddies and Bush economic policies on freakin’ steroids. I hate to break it to ya, but when you vote for change without specifying what kind of change you want, this is exactly what you get.”

    Well, first, I have to take issue with you saying he’s bringing in Clinton’s old buddies as if it’s an entirely bad thing. I think he can do without some of them, like Larry Summers, but for the most part, bringing in people from the Clinton Administration shows a level of maturity. It tells me that Obama is serious about getting things done. The only reason you see Clinton’s people recycled is because his was the last Democratic administration. Clinton made a mistake when he chose not to have anyone in the Carter administration show him the ropes. It’s why he was kind of lost in the woods for the first couple of years. By Obama not going it alone, he’s showing us that he’s serious about getting down to business. Secondly, I have to respectfully but wholeheartedly disagree with you about Obama implementing Bush’s economic policies. And as far as you tearing down the notion of changing things, one, I think anything done right now will be a most welcome change, and two, change comes from the policies, not the people. So while you may see things so one dimensionally, and not like the fact that Clinton folks are in the Obama administration, ultimately they won’t be the ones setting policy, Obama will. And I have complete confidence that, while he will listen to a multitude of ideas, he’s got a level head on his shoulders and do what he feels is the best thing to do.

  23. “As for the bankers, fine, castigate them all you want. Now what about all of those people who bought real estate they could not afford? They will get away with that.”

    And your solution is to punish the many to catch the few? It makes no sense.

  24. “I agree. I really miss airplanes flying into buldings and killing thousands of people. Don’t you?
    I abhor Bush’s economic policies but I applaud him for keeping us safe.”

    *sigh*
    How easily you forget that he failed to keep you safe in the first place…

  25. “And your solution is to punish the many to catch the few? It makes no sense.”

    What do you mean by that? Punish the many to catch the few?

    My best friend bought a home two years ago with 20% down and a 30 year fixed rate mortgage. That used to be the way people bought homes.

    He is now $50K underwater and growing.

    He makes over $100K a year.

    Bail him out? He can pay his mortgage, property taxes, insurance and upkeep. He’s stuck in a house that investment wise went south on him.

    Instead of buying real estate, I invested in mutual funds. My net worth is 40% lower than a year ago. I am not underwater. I am not asking anyone to give me back my 40%. I made stock market investments that went south on me. That’s my bad luck. That’s all it is.

    Then there is a coworker of mine and his wife. A starter home wasn’t good enough for them. They wanted more. Thanks to no money down, and a two year LIBOR lock they got a house they could “afford” as long as real estate prices kept rising. But, that did not happen. That’s too bad too by the way.

    Two years went by to where we are now. They could not afford to pay the new mortgage after the LIBOR unlocked. They could not refinance due to the drop in value. They lost the home they were living in.

    So tell me Robert, which one of us three gets a bail out and why? As I said before it is simple matter of bad luck and nothing else.

    I am not 100 percent cold hearted about this. If preventing more foreclosures keeps people in their homes and acts as a shock absorber against more economic decline then count me in. But I don’t see how it can work. I can see my friend balking on his mortgage payments so he can get a free ride.

    I can see down the road more people buying too much house and counting on the government to cover their asses.

    I think you would agree with me we need to be very cautious about who gets help.

    Instead of having another rant as you put it, this is part of my plan.

    Before you any person gets mortgage help that person has to provide a complete and full financial disclosure for the last three years. This will prevent people who can afford their mortgages from getting help they don’t need. This will prevent people of means from intentionally stopping their mortgage payments so they can jump on the gravy train.

  26. “What do you mean by that? Punish the many to catch the few?”

    What I mean is by letting everyone drown in order to teach the liars, as it were, a lesson, isn’t a smart idea. But that’s not what will happen. President Obama has explicitly said that any mortgage rescue will help only those who were screwed by the banks. There’s no doubt that there were people who bit off more than they could chew, but there should also be no doubt that lots of good people got the short end of the stick. Teaser rates jump immediately to mind. Also the fact that 60% of people with sub prime mortgages were eligible for prime and told so by the bank. These are the people that are deserving of help. You had law professors at Ivy League schools who couldn’t discern what exactly was in the terms of some of these mortgages. It was a ruse for the most part, so when the homeowner is blamed I have a bit of a problem with it.

    It’s hard to feel sympathy for those investors who were flipping houses and artificially inflating home values in the process. Here in Phoenix, there was no shortage of douchebags from California who bought up properties left and right because the price was right. They artificially drove home prices up, so when my now ex wife and I went to buy a home, everything was far overpriced, and what would have been affordable two years earlier was out of our price range. Our choice became to continue renting or settle for less on a house. Thank God we chose the former.

    “If preventing more foreclosures keeps people in their homes and acts as a shock absorber against more economic decline then count me in”

    That’s the plan that I’m hearing. A six month freeze on home foreclosures. I think it could work. It would give people some breathing room, one less bill to worry about, a chance to save some money. I think a better idea is to allow people to renegotiate the terms of their mortgages with the banks. I think if they could do that, either lower their interest rates or extend the life of the loan, it would be better for everyone involved. Better for the homeowner, obviously, and better for the bank, because instead of getting no money (which at one point was happening quite frequently), they get some, because God knows that a foreclosed house on the bank’s books is not an ideal situation for them, considering it will be sitting there for quite some time, losing money, and bringing in no money to the banks.

    “I can see down the road more people buying too much house and counting on the government to cover their asses.”

    I don’t. I see this as a hard lesson learned. I think if anything, it will scare people away from the housing market.

    “I think you would agree with me we need to be very cautious about who gets help.”

    I do agree. And it seems our president is one step ahead, which is a good thing.

    “Before you any person gets mortgage help that person has to provide a complete and full financial disclosure for the last three years.”

    I absolutely agree. Those kinds of things should be incredibly hard to get. I can’t tell how often I’ve heard older people tell me how hard it used to be to even get a credit card.

  27. “How easily you forget that he failed to keep you safe in the first place…”

    How was that Bush’s failure, exactly? Eight months after he took office doesn’t make it his fault. How many times were we hit while Clinton was in office? The Khobar Towers, Mogadishu, the Embassies in Kenya and Tanzania, the first WTC bombing, the USS Cole…9/11 was the next step on the ladder. Clinton did next to nothing more than wag a finger and say, “now, now, you better not do that!”

    I don’t know if anyone here remembers, but after Clinton yanked our troops out of Mogadishu without trying to do anything to stop what was going on, Bin Laden smiled in an interview and explained that it was our defeat in Mogadishu that convinced him that the US was a paper tiger.

    If Bush was to stop 9/11 from happening, someone please tell me how.

  28. “Our choice became to continue renting or settle for less on a house. Thank God we chose the former.”

    That may turn out to be the best financial move of your life; and mine too. I stayed out of the housing market for that reason too. Where I live it was very common to have over 10 interested parties bidding on the same home. That’s insane. It was also common for a home to sell for 30% above the listed price too.

    As for those speculative douchebags from California, I have two of them as clients. They are stuck with overpriced homes in Vegas. Too bad I say. They can afford to pay the mortgage, taxes, upkeep and maintenance so they do and they should.

    I am not totally sold on banks “conning” people. One of the fundamental premises in our society is when you sign a contract you sign knowing you understand exactly what you are signing. To have a mass of people come back after the fact and say they never knew what they were getting into opens a door I think should remain shut.

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