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The Government Made Me Do It

I heard it again the other day in what was a reasoned debate/conversation about the financial crisis of the past few years, someone said: "It wasn't Wall Street and the banks that made all those loans, they were forced to lower their lending standards by the government."

There is one and only one way to address that assertion - "Bullshit!" Unmitigated, unfounded, truthless bullshit! But presented with the facts, some people still need to cling desperately to their own fantasy version of reality.

Here are the facts, you only need to consider two numbers:

$1.4 trillion U.S. dollars
$140 trillion U.S. dollars

Notice that the second number is 100 times larger than the first. So here goes the easy explanation even for those who consider themselves math challenged. In the U.S. the grand total of "bad" real estate loans at the peak of the financial crisis was 1.4 trillion dollars. If the U.S. government wanted to step in to prevent the near financial collapse caused by these "bad" mortgages it could have done so for 1.4 trillion dollars. Just buy up all those bad loans and manage the portfolio. Crazy? Well since the U.S. government spent 2.5 trillion in the bank bailout, 1.4 trillion would have been a discount. And. . . less than half of those "bad" loans actually defaulted, the other half are still making their monthly payments.

So why didn't this happen? Well let's go back to the ridiculous argument that the banks and their Wall Street backers were forced to make these credit risky loans. Say the U.S. government had bought all the loans for 1.4 trillion and apologized for forcing the banks to be so financially irresponsible, wouldn't all of the financial problems gone away?

Well no, you see the 1.4 trillion of subprime ("bad") mortgages were not the problem, no matter who originated those loans or why they made them. You see Wall Street (AIG) used those 1.4 trillion of actual mortgages, loans with real property behind them; Wall Street used those loans to create 140 trillion dollars worth of fake collateralized investment paper . Mortgage default swaps and other byzantine derivative investments all based on that original 1.4 trillion in actual loans. That 140 trillion was sold worldwide and other bankers in other countries followed Wall Street's lead and ventured into the same speculative investment instrument creation based on their real estate markets.

Understand these "other" investment contraptions had no financial basis other than the actual mortgages. One hundred times more money was generated in investment paper than the real estate mortgages held in value.

1.4 trillion in mortgage debt X 100 = 140 trillion on top of the actual mortgage paper

Nothing justified the creation of wealth out of thin air. The mortgage back securities were worth 1.4 trillion the rest of the 140 trillion was slight of hand. No one, not one single soul on Wall Street has ever suggested that the government made them create that pile of worthless investment paper. It was fraud, it was irresponsible, it was greed and it was criminal.

And most of all, the government did not make them do it.

Now does anyone want to know why there is this movement called Occupy Wall Street?

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Rush Limbaugh & Mike Doonesbury

So are you a "Dump Rush" but a "Keep Doonesbury" liberal. Or perhaps a "Burn Doonesbury" and "Liberate Limbaugh" conservative. Or might you be a independent free-thinker who can go both ways?

It seems Garry Trudeau has gone too far with this coming week's strips and has, as one editor put it - "created content that is inappropriate alongside Garfield and The Duplex." I don't know what The Duplex is, but I certainly don't want the existential insight of a big orange cartoon cat sullied by Trudeau's pinko political observations. Oh wait, I do want that!

You will have to excuse me but the 124 republican primary debates have got my political priorities so turned around that I just can't think straight. And if women seeking reproductive services are as confused as I am, well perhaps a 72 waiting period is not long enough. Heavens knows women tend to me more easily upset by these things than us men and look how confused all of this debate has gotten me. I mean a panel of thoughtful middle-aged Texas men might be the best way to make decisions about war, taxes and those sensitive vaginal issues.

On the other hand if what you want is to either shut Rush up or stop the Doonesbury strips from running in your local paper - You, my friend, are engaging in censorship. Cut it any way you like perhaps the free market reacting to Rush's stupidity and pulling advertising from his show. Or the newspaper editor protecting his readers from social commentary on the comic pages. Right, left, extremist, patriot, fundamentalist, parent, christian, liberal, social conservative - use any label you like - you are advocating censorship.

You may not be able to shout "Fire" in a crowded theatre but saying "slut" on the radio or mentioning a "transvaginal exam" in the funny papers, these are not utterances worth sacrificing the First Amendment. You all remember that amendment right, it's why I can write what I want in this blog and citizens of North Korea, Iran and Syria are murdered by their governments for even attempting something as subversive as free speech.
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More Juxtaposition







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Juxtaposition

When I went to bed last night I knew the moon would be precisely full just after 1 a.m. west coast time. 

Autosuggestion can be powerful, I woke up with the bright white orb hanging high over San Francisco casting a bright white spot across the floor below my west facing windows. I stood in the cold glow and let my mind wander - all the light of the moon is reflected. Unlike the sun, the moon is cold with no thermal activity, it sheds no light of its own. I didn't bother with my glasses, I just stood in the light. Eventually a chill set in and I crawled back under the covers.

Something woke me just after five. By then the moon was low on the horizon and my entire bed was flooded with white light. I stepped to the windows again and noticed the moon had begun to take on an orange hue as it set into the marine layer. There were nearby clouds drifting from the north, wait that might be steam from that plant near the bay or smoke - what the hell!

I went to retrieve my glasses because there were flames. Yep that building was on fire! Just then the engine sirens started up from the firehouse down on Shattuck. That building was only a couple of blocks from where I stood and those flames were really starting to build. Soon the television copters arrived and the early morning news shows reported a six unit apartment building was fully involved.

As I watched the morning brighten into dawn, the orange moon set slowly into the Marin headlands across the Bay through the morning mist rising off the sun warmed water and the billowing smoke from the nearby apartment fire.

More juxtaposition tomorrow.
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Make It a Clown Parade

I am going to guess that some of my readers were slightly insulted by my post yesterday in which I referred to the four remaining republican candidates as clowns.


I just wanted to set the record straight today for those who have forgotten my opinion of the current occupant of the oval office.


Don't you love farce?
My fault I fear.
I thought that you'd want what I want.
Sorry, my dear.
But where are the clowns?
Quick, send in the clowns.
Don't bother, they're here.


Apologies for taking those lyrics so far out of context, as compensation here is Judy Collins singing them correctly.



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Stupor Tuesday

Vermont, Virginia, Massachusetts, Idaho and Wyoming to the sad, humorless clown;


Oklahoma, North Dakota and Tennessee to the bozo who loves barefoot, pregnant, mute women;


Georgia to the oft divorced pudgy clown;


and bunch of convention votes to the libertarian floppy footed booby;

which taken all together still means what most reasonable folks have known for several months - Romney vs. Obama in November.

But it also means that the four clowns will continue to entertain awhile longer.

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Chocolate


Researchers at Cambridge University have published results in the British Medical Journal that confirm what I have known prayed for my entire life.

"Based on observational evidence, levels of chocolate consumption seem to be associated with a substantial reduction in the risk of cardiometabolic disorders."

Chocolate is good for your heart, metabolism in general, lower incidents of stroke and coronary heart disease. Chocolate ingestion is also associated with the reduction or prevention of high blood pressure and other cardiovascular conditions. Dark chocolate is better than milk chocolate at achieving these benefits and there are some minor caveats about the amount you consume, something about binge eating and mass consumption; but other than that - Great News!
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