The Moderate Voice - Latest Comments in Stunt Over: McCain will debate without deal on bailout

Re: Stunt Over: McCain will debate without deal on bailout

kritt11 — Sat, 27 Sep 2008 00:07:27 -0000

BTW, I'm wondering if there was pressure on Bernanke and Paulson from the WH to pretend the economy was in good shape when, in fact it was teetering on the brink of Armageddon.

I guess because Bush has never wanted to acknowledge any bad news in 8 years in office. (Remember when no one in the administration was allowed to recognize the insurgency in Iraq or say that there was a civil war going on? Use the "r" word about the economy?)

Re: Stunt Over: McCain will debate without deal on bailout

kritt11 — Fri, 26 Sep 2008 22:59:11 -0000

Good point there, Polimom, and I gotta agree with you on that one! Still, in
comparison to Newt and his "researchers" they're economic geniuses!

Re: Stunt Over: McCain will debate without deal on bailout

JWeidner — Fri, 26 Sep 2008 18:59:10 -0000

Wow....Mad Max Beyond Thunderdome reference....Props!

Re: Stunt Over: McCain will debate without deal on bailout

mlhradio — Fri, 26 Sep 2008 18:14:50 -0000

MasterMcBlaster: "Who run Bartertown?"

Congressional Republicans: "McCain runs Bartertown."

MasterMcBlaster: "Campaign Embargo...OVER!"

Next up: Thunderdome in Mississippi. Two men enter, one man leave. Spin the wheel, Raggedyman!

Re: Stunt Over: McCain will debate without deal on bailout

Polimom — Fri, 26 Sep 2008 17:35:57 -0000

kritt11 -- your comment made me laugh. Not so much because you picked on Newt, but because you see Bernanke and Paulson as knowledgable / trustworthy sources at the moment, when they've been telling us almost non-stop for months and months that everything's fine.

Re: Stunt Over: McCain will debate without deal on bailout

kritt11 — Fri, 26 Sep 2008 17:03:42 -0000

jwest

Oh well if Newt said it-- then we have nothing to worry about! I'd take his word over Bernanke and Paulson anyday. :)

Of course that little egomaniac has to find a way to grandstand even when he's not running for anything.

Re: Stunt Over: McCain will debate without deal on bailout

roro80 — Fri, 26 Sep 2008 16:56:31 -0000

Yes, i guess we'll have to see. Despite your insistence, I really don't see how McCain can come off as anything but an idiot over the whole thing, but I may very well be proven wrong.

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 16:16:42 -0000

Quick note:

Newt Gingrich just said his researchers have calculated an elimination of mark to market as being worth 500 billion of the 700 billion problem.

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 16:12:34 -0000

Roro,

We’ll have to see how it plays out at the debate tonight.

If the moderator picks up on the theme that Obama/Reid/Pelosi/Dodd/Bush are in agreement and McCain/Congressional Rep. are the holdouts, game over for the community organizer.

100 million viewers – ain’t no ‘splain’in this one away.

Re: Stunt Over: McCain will debate without deal on bailout

Polimom — Fri, 26 Sep 2008 15:53:46 -0000

Just FYI -- if this mark to market drifts the thread too far off-topic, I've opened a post at Polimom for specific discussion.

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 15:53:01 -0000

pacatrue,

At one point, the same rule worked in reverse for institutions to add value to their balance sheets.

I’m not a finance guy, but apparently it was used to help implement a low income housing initiative during the Clinton administration.

As with most every liberal policy, it was intended to do good, but ended up causing havoc.

Re: Stunt Over: McCain will debate without deal on bailout

ChrisWWW — Fri, 26 Sep 2008 15:46:36 -0000

Great explanations from both of you. Thanks for clearing that up.

Re: Stunt Over: McCain will debate without deal on bailout

Polimom — Fri, 26 Sep 2008 15:43:36 -0000

Paca -- I can try. I'm not an economist, but here's the way I understand mark to market:

Let's say Bank A and Bank B each own an asset, for which they each paid $100. For the sake of this simple comment, assume it's the only capital asset each bank has. Let's further suppose that Bank A and Bank B are allowed to make loans at a ratio of 10 to 1 (in relationship to the capital). In this case, Bank A and Bank B have both therefore extended $1,000 in various loans.

But now Bank B decides to sell its asset for $110. Mark to market means that everybody holding the same kind of asset must now revalue to this latest price.

Cool! Bank B's selling price means that Bank A's capital goes up by 10% -- which means they can extend a further $100 in loans.

But what happens when Bank B sells for less than what it paid? Say... $90? Now Bank A has to mark its own asset down to that same value. And because the regulations say that they cannot leverage further than 10:1, they also have to bring their loans back in line with the required ratio. So now they have to call in 10% of their loans.

Does this make any sense?

So -- the recent "fire sales" (like Merrill Lynch) had assets selling for something like 22 cents on the dollar. Think about what impact mark to market will have on the asset values.... and thus the banks' ability to make loans -- or even leave existing loans in place.

Re: Stunt Over: McCain will debate without deal on bailout

pacatrue — Fri, 26 Sep 2008 15:37:39 -0000

jwest, that rule sounds insane. What was the motivation behind it? I guess it's that it's based on the fact that the "home owner" doesn't really own the home and so the real owners, the lenders, are getting their value back?

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 15:34:28 -0000

Polimom could give you a better explanation, but I’m handy, so I’ll give it a shot.

Mark to Market is a rule to adjust the value of an asset on your books to the current fair market value.

If you want to personalize the theory, here’s an example.

Let’s say you own a house that you paid $500,000 for just last year. You took out a mortgage for $450,000 and are making the payments easily.

Let’s also say that you have an extra $25,000 in savings for emergencies.

You wake up one morning and find that your neighbor with a similar house had to sell for $300,000, due to fact that the market was down and the neighbor was forced to sell quickly for whatever he could get.

If you had to live under mark to market rules, your bank would come to you and say your house was only worth $300,000. So, even though you are making your payments on time, they want the difference. $450,000 - $300,000 = $150,000.

Pay up. Right now! Even though you had cash reserves, it’s not enough to cover the difference.

You would now have a liquidity problem. All because of a rule that could be eliminated by the stroke of a pen.

I hope this helped explain it.

Re: Stunt Over: McCain will debate without deal on bailout

roro80 — Fri, 26 Sep 2008 15:31:19 -0000

But jwest, using your own line -- "No one has ever gone broke or lost an election underestimating the intelligence of the American voters". I've seen some of the things Reid and Pelosi have been saying, but I'm a poli-junky. Normal people see Bush's gloom-n-doom speach, hear him say "Oh my god we're all screwed unless you pass this bill right the hell now!!!1!!!1!!", they hear McCain saying basically the same thing "It's so bad that I have to suspend my campaign because OMG AHHHH!!!!" and then you hear Obama saying that we need to make sure that we get it right and that there are protections for everyday people and regulation and transparency put into the bill. I just don't see this "super-mavericky maverick and the I-hate-fat-cats Republicans swooping in to defy the crazy corporate-lovin' Dems and their favorite president ever, Dubya" storyline playing out all that believably to most people. But maybe that's just me.

ChrisWWW -- Word, dude.

Re: Stunt Over: McCain will debate without deal on bailout

JWeidner — Fri, 26 Sep 2008 15:20:51 -0000

LOL JWest. I gotta hand it to you for tirelessly flogging that dead horse of a plan. We'll see how it all turns out...new polls showing Obama continuing to gain seem to bear out my argument that the people aren't going to keep falling for McCain's continual B.S., but we'll see...

Re: Stunt Over: McCain will debate without deal on bailout

pacatrue — Fri, 26 Sep 2008 15:12:13 -0000

Hey, polimom, can you explain the mark to market rule for the clueless like me?

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 15:04:47 -0000

Roro,

“and to most people Dubya = all Republicans”

That was the dangerous part of McCain’s magic trick. Had Reid, Pelosi, Dodd, Frank and all the surrogates kept quiet yesterday evening and today, it would have appeared to be a strictly administration program.

Being so full of themselves, they couldn’t resist the chance to preen for the cameras before thinking about how they were tying themselves to Bush.

Now, you have an unpopular President joined at the hip to even more unpopular congressional democrats in a scheme to waste taxpayer’s money on a historic scale. They couldn’t even resist the temptation of trying to load the bill with pork.

McCain and the House republicans are the only ones standing apart.

Bippity…..Boppity…..BOO!

Re: Stunt Over: McCain will debate without deal on bailout

ChrisWWW — Fri, 26 Sep 2008 14:58:30 -0000

roro80,
Lately the Republicans have had nothing but solutions to problems that don't exist:

Iraq has WMD
Rich people pay too much in taxes
There are too many restraints on torture & eavesdropping
New Orleans doesn't have enough water
People have too much health insurance, especially kids

Re: Stunt Over: McCain will debate without deal on bailout

roro80 — Fri, 26 Sep 2008 14:52:13 -0000

When it comes right down to it, didn't AIG go out of business because they were selling insurance guaranteeing that people who couldn't afford their morgages would some how magically be able to pay them off? And now, the Republicans are proposing that the solution to this is that the banks buy insurance, ensuring that people who still can't pay their morgages somehow eventually will? Huh? That doesn't make a lick of sense.

Also: I don't think that jwest's interpretation of how this will come off to Joe-Q voter is correct at all. What I see people saying is that our president (and to most people Dubya = all Republicans because of the congressional rubber stamp of his first 6 years) is making a proposal to bail out Wall St, and the Democrats are seeing that while something does need to be done, the average person needs some protections in there -- oversite, regulation, and help for homeowners. Whether or not congressional Republicans are for the Bush plan, people are going to see it as coming from the Republican administration, while changes for the protection of the average voter are being demanded by the Dems. Much easier story line.

Re: Stunt Over: McCain will debate without deal on bailout

Polimom — Fri, 26 Sep 2008 14:48:23 -0000

Populists R Us, eh?

::shudder::

BTW -- suspending the mark to market rule would definitely make a huge difference -- and it wouldn't require anybody to fork over 700 billion dollars, either.

Re: Stunt Over: McCain will debate without deal on bailout

jwest — Fri, 26 Sep 2008 14:47:11 -0000

JWeidner,

No one has ever gone broke or lost an election underestimating the intelligence of the American voters (consumers).

The beauty of this situation was that the democrats and the press were the ones portraying the Paulson plan as a Wall Street bailout for the rich. It was a piece of Rovian genius to turn that plan into the Reid/Pelosi/Dodd/Paulson/Bush proposal that is doing battle with the McCain/House Republican plan.

“Karl, you magnificent bastard.” (Patton)

To pick up on a previous Polimom theme:

“How do you think he does it? What makes him so good?”
(Pinball Wizard)

Re: Stunt Over: McCain will debate without deal on bailout

jchem — Fri, 26 Sep 2008 14:45:10 -0000

"It's about the most popular person winning"

American Idol!! Ah!!!

How about "So you think you think you can govern?" or "Are you smarter than GWB?" Heh...

Re: Stunt Over: McCain will debate without deal on bailout

pacatrue — Fri, 26 Sep 2008 14:44:16 -0000

I loved the Dewey beats Truman campaign graphic in Elrod's post. Unfortunately, it's already been taken down (as has been said).

One thing that isn't clear is whether McCain ever suspended his campaign at all, other than canceling on Letterman. I was reading FactCheck.org articles about McCain attack ads just yesterday, though perhaps those ads were a couple days old. By the way, Factcheck just published a nice summary of election fibs so far this year if you'd like to get caught up without reading all the archives.