Have you seen this? It was in the RJ Tuesday but since I am late I can only link to the Chicago Tribune: Filipino veterans in line to earn WWII benefits. Now, I am all for vets of any conflict getting their due. Ethnicity should have NOTHING to do with it. These benefits should have never been promised to them, they should have been given to them. The problem here is the shining example of what is wrong with Capitol Hill (and probably most other legislatures around the country). Filipino WWII Vets receiving benefits, I feel, would be able to stand on it's own as a bill. There is no need to lump it in with the stimulus package. How many times have we heard or seen in the news that xyz was passed as part of H.R.1234? If only one vote was cast in favor of the stimulus because a Senator or Representative did not want to vote against Filipino WWII Vets, that is one too many. The stimulus bill is the stimulus bill. A Filipino Vets Bill is a Filipino Vets Bill.
Seriously, find me one person on Capitol Hill that would vote against Filipino Vets if the bill were to stand on it's own.
Saturday, February 21, 2009
Citation For mschaffer Posting in the Las Vegas Sun
The following is posted for the benefit of mschaffer, a poster to a letter-to-the-editor in the Las Vegas Sun.
This is an excerpt from his post:
"Your claim of lenders being forced to lend to high risk borrowers needs citations as others claiming this have been found to be poorly informed by conservative propaganda."
This is an excerpt from his post:
"Your claim of lenders being forced to lend to high risk borrowers needs citations as others claiming this have been found to be poorly informed by conservative propaganda."
1990's
Initially the GSEs (government sponsored enterprises) resisted purchasing these risky mortgages but eventually the Clinton Administration instructed (para.3) them to substantially increase the percentage of these mortgages in their portfolios.
October 1992
Congress, enacting the Federal Housing Enterprises Financial Safety and Soundness Act (para.12)of 1992, allowed legislation to "amend and extend certain laws relating to housing and community development." It also "established HUD-imposed housing goals for financing of affordable housing and housing in central cities and other rural and underserved areas."
November 1994
President Clinton addresses homeownership (para.4): "I think we all agree that more Americans should own their own homes...I am committed to a new and unprecedented partnership between industry leaders and community lenders and Government to recommit our Nation to the idea of homeownership and to create more homeowners than ever before."
June 1995
June 1995
The administration announced (para.24) the bold new homeownership strategy which included monumental loosening of credit standards and imposition of subprime lending quotas.
May 1999
The LA Times reports that African Americans homeownership is increasing three times as fast as that of whites, with Latino homeowners is growing five times as fast, attributing to the growth to breathing "the first real life into enforcement of the Community Reinvestment Act." This breath of "life" mandated that Fannie Mae and Freddie Mac buy mortgages with deviant down-payments and debt-to-income rations which allowed lenders to approve mortgages for lower-income families that would have been denied otherwise.
September 1999
With pressure from the Clinton Administration, Fannie Mae eased credit requirements on loans it would purchase from lenders, making it easier for banks to lend to borrowers unqualified for conventional loans. Raines explained that "there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market," reported the New York Times (para.5).
...warned Peter Wallison. "If they (Fannie & Freddie) fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry" (para.8).
(According to Wallison's bio on Wikipedia, "1999-present American Enterprise Institute, codirector of AEI's financial markets deregulation project." I used Wiki simply to provide a broad stroke to describe him)
(According to Wallison's bio on Wikipedia, "1999-present American Enterprise Institute, codirector of AEI's financial markets deregulation project." I used Wiki simply to provide a broad stroke to describe him)
March 2000
Rep. Richard Baker (R-Louisiana) proposed a bill to reform Fannie and Freddie's oversight in a House Subcommittee on Capital Markets. Rep. Frank (D-Massachusetts) dismissed the idea, saying concerns about the two were "overblown" and that there was "no federal liability there whatsoever." (para.4)
June 2000
Fred L. Smith Jr., writing in Investor's Business Daily (para.4), recalls testifying before the House Financial Services Committee that GSE "special privileges create a serious hazard to the market, to taxpayers [and] to the economy." These new debt portfolios "will certainly increase the likelihood of a Fannie-Freddie default."
April 2001
Fiscal Year 2002 Budget (p142, 'Uncertainties') declares that the size of Fannie Mae and Freddie Mac is "a potential problem," because "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity," says a White House release.
February 2003
OFHEO (Office of Federal Housing Enterprise Oversight) reports that "although investors perceive an implicit Federal guarantee of [GSE] obligations...the government has provided no explicit legal backing for them," warning that unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market, according to a White House release. (p.5, para.2)
June 2003
Freddie Mac reported it had understated it's profits by $6.9 billion. OFHEO director Armando Falcon Jr. requested that the White House audit Fannie Mae.
September 2003
Rep. Barney Frank (D-Massachusetts): "I do not think we are facing any kind of crisis. That is, in my view, the two government sponsored enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis...I do not think at this point there is a problem with a threat to the Treasury...I believe that we, as the Federal Government, have probably done too little rather than too much to push them to meet the goals of affordable housing and to set reasonable goals.
October 2003
November 2003
Council of the Economic Advisers Chairman Greg Mankiw warned (p.7), "The enormous size of the mortgage-backed securities market means that any problems at the GSEs matter of the financial system as a whole. This risk is a systemic issue also because the debt obligations of the housing GSEs are widely held by other financial institutions. The importance of GSE debt in the portfolios of other financial entities means that even a small mistake in GSE risk management could have ripple effects throughout the financial system,' from a White House release.
October 2004
In a subcommittee testimony, Democrats vehemently reject regulation of Fannie Mae in the face of dire warning of a Fannie Mae oversight report.
Rep. Barney Frank (D-Massachusetts)(p.10): "Uh, I, this, you, you, you seem to me saying, 'Well, these are in areas which could raise safety and soundness problems.' I don't see anything in your report at raises safety and soundness problems."
Rep. Barney Frank (D-Massachusetts)(p.10): "But I have seen nothing in here that suggest that the safety and soundness are at issue, and I think it serves us badly to raise safety and soundness as king of a general shibboleth when it does not seem to me to be an issue."
Rep. Christopher Shays (R-Connecticut) (p.182): "And you have about 3% of your portfolio set aside. If a bank gets below 4%, they are in deep trouble. So, I just want you to explain to me why I shouldn't be satisfied with 3%?"
Franklin Raines, Fannie Mae CEO (p.182): "These assets are so riskless that their capital for holding them should be under 2%."
Wednesday, February 18, 2009
SB114 Alternative Energy Bill
OK, let's give credit where credit is due. I will not always take the side of the GOP, but I will always tell it like I see it. Sen. Mike Schneider, D-Las Vegas, nailed it. HOA's have a purpose, but since I do not live in one I am unable to determine what that purpose is. In today's society if a resident chooses to make their home more energy efficient by installing a solar energy system, most would agree that home now becomes more desirable. If a prospective buyer comes along, they may be more interested in purchasing a home that already has the system installed; now the buyer will not have to install it. Bravo to you Sen. Schneider. I have a question for anyone currently sitting on the board of an HOA: What is the downside of having such a system installed? How about this idea: an HOA could require (although we all dislike being forced into anything) all residents to install a solar energy system. By negotiating a group rate for the residents the cost of installation will be easier to bear. Now all home will have the unsightly solar panels and look the same. If enough residents are in the HOA, it might even be possible to negotiate a better rate with NV Energy. Then, this particular neighborhood could become the model HOA for the nation. Please, How is this not a good idea?
Atkinson's AB175
WOW! Way too much time away. With the new session in progress I will do my best to stay on top of the action in Carson City. With that said, let's look at AB175, presented by Assemblyman Atkinson.
While no one wants the economy in Nevada to get worse, should not the state still conduct business in a business manner? By forcing companies that bid on state contracts to provide certain benefits AB175 dictates the profit a company can earn on a given project. Requiring these benefits also excludes some companies from being able to bid on these projects. Proper business practice dictates that a given project go to the lowest bidder, thus saving the state much needed funds for other spending. The winning bidder would of course have to meet the requirements of the project itself, but so long as the winning company does not participate in any fraudulent activity, they should get the contract.
Let's examine a few points as spelled out in the article in today's Sun. What exactly is a 'living wage'? Who actually determines that wage? The wage should be determined by the market, as current law dictates. "Employer-paid health insurance"? Really? You would require this? Basic economics show that a company that does not provide what employees want/need, will not be able to obtain/keep employees. With no employees they will not have the staffing to accomplish even the most minimal of tax-payer funded projects. If the company wants to stay in business and stay competitive, they are forced by the market to provide what employees want. Why not force all companies to provide a pension plan for all employees? Oh wait, wasn't the intention of Social Security to provide some sort of pension for all of us? It is not really a good plan to force any entity to provide for someone else's retirement. Again, if an employer does not provide what an employee (pension, health plan, reasonable wage & other benefits) they will not have employees. State-approved training? Shouldn't the employees and/or the company itself already have the experience to complete the project at hand? This idea basically tells me that experience is not required because we will pay for you to gain experience on the job; thus increasing the cost of said project. All of these requirementswould force those companies bidding on a project to raise their minimum bid, thus forcing the state to pay more than is necessary. I may be wrong, but one of the most basic tenets of conducting good business is to reduce costs. It seems to me this is a sure-fire way to increase costs.
The bottom line is this: the winning bid should go to the most qualified company with the lowest cost to taxpayers.
While no one wants the economy in Nevada to get worse, should not the state still conduct business in a business manner? By forcing companies that bid on state contracts to provide certain benefits AB175 dictates the profit a company can earn on a given project. Requiring these benefits also excludes some companies from being able to bid on these projects. Proper business practice dictates that a given project go to the lowest bidder, thus saving the state much needed funds for other spending. The winning bidder would of course have to meet the requirements of the project itself, but so long as the winning company does not participate in any fraudulent activity, they should get the contract.
Let's examine a few points as spelled out in the article in today's Sun. What exactly is a 'living wage'? Who actually determines that wage? The wage should be determined by the market, as current law dictates. "Employer-paid health insurance"? Really? You would require this? Basic economics show that a company that does not provide what employees want/need, will not be able to obtain/keep employees. With no employees they will not have the staffing to accomplish even the most minimal of tax-payer funded projects. If the company wants to stay in business and stay competitive, they are forced by the market to provide what employees want. Why not force all companies to provide a pension plan for all employees? Oh wait, wasn't the intention of Social Security to provide some sort of pension for all of us? It is not really a good plan to force any entity to provide for someone else's retirement. Again, if an employer does not provide what an employee (pension, health plan, reasonable wage & other benefits) they will not have employees. State-approved training? Shouldn't the employees and/or the company itself already have the experience to complete the project at hand? This idea basically tells me that experience is not required because we will pay for you to gain experience on the job; thus increasing the cost of said project. All of these requirementswould force those companies bidding on a project to raise their minimum bid, thus forcing the state to pay more than is necessary. I may be wrong, but one of the most basic tenets of conducting good business is to reduce costs. It seems to me this is a sure-fire way to increase costs.
The bottom line is this: the winning bid should go to the most qualified company with the lowest cost to taxpayers.
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