Items of Interest:
Andrew Napolitano, NY Sun:
Housing Bailout is Simply Unconstitutional - When Treasury Secretary Henry Paulson announced that the government would provide a credit line to shareholders of Bear Stearns in order to prevent the giant investment bank from collapsing, he was consciously making a profound choice to use taxpayer dollars to save one bank and not to save another...
The constitutional reasons get us back to Mr. Paulson's choices. How can the feds decide who to bail out and who to let die? Virtually all banks are being challenged by the current credit crunch. So why save Fannie and Freddie but not Indy? In another generation, why Chrysler but not DeLorean? ...
Idiots Fiddle While Rome Burns -- Either we regulate the Banks, or leave it to the vagaries of the free markets to punish those who trade with, or place their assets in the wrong institutions. But for God's sake, do not give us the worst of both worlds -- do not allow banks the freedom to make horrific but preventable mistakes (i.e., only lending money to those who can pay it back), but then expect the taxpayers to foot the trillion dollar bill.
That's not capitalism, its not socialism, its not regulation, and its sure as hell isn't what free markets are. Our language is insufficient to describe this hodge-podge system, other than to call it a random patchwork of quasi-capitalism, quadrennial-socialism, and politics as usual. Ideological idiocy is the only phrase I can muster that has any resonance with the daily insanity...
Perhaps the rescue of "Phony and Fraudy" are not so much a bail out of American homeowners as it is a desperate attempt to stay in the good graces of our friendly global bankers.
discussion: Deal Journal, Mathew Gross and The Agonist
Mish's ... Trend Analysis:
Senators Bunning and Shelby Blast Bernanke on Monetary Policy -- When I picked up my newspaper yesterday, I thought I woke up in France. But no, it turns out socialism is alive and well in America. The Treasury Secretary is asking for a blank check to buy as much Fannie and Freddie debt or equity as he wants. The Fed’s purchase of Bear Stearns’ assets was amateur socialism compared to this...
"I believe we have turned a corner and that our business is improving"
-IndyMac CEO Michael Perry, April 2008
The IndyMac fiasco: a three-day run of federal incompetence - On Day 3 of the financial hostage drama otherwise known as IndyMac Federal, someone needs to say it: The government's takeover of IndyMac has been a stunning display of cluelessness and incompetence and has given bank customers every reason to feel anxious and angry.
If there is financial unease and anxiousness in America today, it is partly the FDIC's fault.
For the third day in a row, the federal government this morning appeared unprepared to deal with bank customers who simply want their money. Frazzled, anxious and angry Californians -- many of them elderly -- are waiting on blazing sidewalks for the third day in a row, while security guards block the doors to the bank's branches. An elderly woman fainted while waiting in line in Pasadena. Depositors were threatened with arrest yesterday in Encino. This is how the government treats its customers?.
In exactly which manual of customer service does it say the following: When your customers arrive at your place of business, do not open the doors and invite them inside. Instead, guard the doors and tell your customers to wait for hours in the sweltering heat outside. If they grow restless, threaten them with arrest...
LA Times / L.A. Land blog:
WaMu wary of IndyMac cashier's checks -- WaMu manager told her that under a new corporate policy, the bank was not accepting IndyMac checks. If a customer insisted on depositing the check, it could be eight weeks or more before the full amount would be accessible...
Reuters [July 9, 2008]:
Federal Home Loan Bank IndyMac exposure seen covered -- IndyMac Bancorp Inc appears to pose little threat to the Federal Home Loan Bank system, which has advanced the ailing mortgage company billions of dollars in low-cost loans, analysts said.
The loans, or "advances" -- totaling more than $10 billion as of March 31 by the San Francisco FHLB -- are backed by mortgages pledged by IndyMac. The Federal Deposit Insurance Corp, as receiver in a bankruptcy, would follow-through on such collateral agreements, an FDIC counsel said...
Don't get too excited about the housing starts -- Due to an upcoming change to New York building codes that saw homebuilders rushing to file permits and start construction on multi-family homes, the 9.1 percent overall increase in housing starts shown below was not such a substantive move...
Pakistani Investors Stone Exchange as Stocks Plunge -- Pakistan investors stormed out of the Karachi Stock Exchange, smashed windows and cursed regulators after the benchmark index fell for a 15th day, the worst losing streak in at least 18 years.
``I have lost my life savings in the last 15 days and no one in the government or regulators came to help us,'' said Imran Inayat, 45, a protester and a former banker...
- Fannie, Freddie Plan Is Under Siege - Wall Street Journal
- William Ackman on Fannie & Freddie - The Big Picture
- The Costs of Bailing Out Housing - Editorial, Washington Post
- Fed is Navigating a Monetary Minefield - Editorial, Financial Times
- The SEC Finally Steps In - Editorial, Los Angeles Times
- The Bank Liquidity Problem - Heidi Moore, Deal Journal
- In This Economy, Flat is the New Up - Daniel Gross, Newsweek
- Why We Are Not in a Recession - James Pethokoukis, Capital Commerce
- Reagan the Wrong Scapegoat for Market Crisis - Amity Shlaes, Bloomberg
- Reason Why Bankers Feel So Gloomy - Anatole Kaletsky, Times of London
- The Global Run on Washington - Editorial, Wall Street Journal
- Sex party house sells — sort of - footnoted.org