Obama chill’n after hoops
(WASHINGTON) — With the debate over AIG executive bonuses nearly bringing official Washington to a standstill in the past three weeks, the Obama administration today expanded its plan to control Wall Street executive pay, adding provisions to limit compensation for star performers in the National Football League (NFL), National Basketball Association (NBA) and Major League Baseball (MLB).
“Some of these sports stars, like AIG execs, have negotiated sweetheart deals paying them millions of dollars, and yet they lose games,” said White House spokesman Robert Gibbs. “The president shares the outrage of the American people at these obscene salaries and bonuses. There’s nothing that makes the little people feel littler than the thought of these fat cats getting fatter just because that have specialized skills that are in high demand in a free-market economy.”
Indeed, the White House released a recent poll showing that 75 percent of Americans answered ‘Yes’ to the following question: “Do you believe President Obama should personally limit the compensation of anyone who earns a lot more than you do?”
“How hard can it be to show up on Sunday and toss a few passes?” said Mr. Gibbs. “The fact that some people earn a lot more money than others just demonstrates the savage inequalities inherent in a capitalist system, and explains why the president has taken deliberate action to end it.”
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President Obama acknowledged today that he signed an “imperfect omnibus bill” but told Congress to clean up its act when it comes to pork-barrel projects, better known as earmarks.
The president signed the $410 billion pork-laden spending bill behind closed doors and away from the glare of the cameras.
“I am signing an imperfect omnibus bill because it is necessary for the ongoing functions of government. But I also view this as a departure point for more far-reaching change,” President Obama said in a speech on earmark reform.
Lashing out against those who have criticized the earmarks in the bill, Obama added: “Now, let me be clear: Done right, earmarks give legislators the opportunity to direct federal money to worthy projects that benefit people in their district, and that’s why I have opposed their outright elimination. I also find it ironic that some of those who railed the loudest against this bill because of earmarks actually inserted earmarks of their own — and will tout them in their own states and districts.
— ABC News
Clearly this guy is shaping up as the all time champion of talking out of both sides of his mouth at the same time. He has been avoiding direct questions from the press and probably still feels confident he still has the main stream media in his back pocket. I guess he takes us all for a bunch of idiots when just a few weeks ago he spoke out against “earmarks” happening on his watch. Seems like earmarks are now ok as long as they meet his socialistic agenda of increasing the power of big government (aka as “the State”).
If his signing this bill is not abject hypocrisy, then it is the weakest case of over rationalization and double speak he has made yet to the American people. No wonder he lacked to courage to take questions from the press today after his remarks. He knew exactly what they would be asking him!!
U.S. presidents usually don’t try to give investing advice on the stock market. But not this President. President Obama opted today to play financial adviser to America and the World.
“What you’re now seeing is profit and earning ratios are starting to get to the point where buying stocks is a potentially good deal, if you’ve got a long-term perspective on it,” Obama said this in public in the White House while meeting with British Prime Minister Gordon Brown. – Pres. Obama 3/3/09
So just where and when did Pres. Obama get his financial consulting license? As President he needs to be very careful about what he says in public regarding the financial markets. These personal tips of guidance are just one more example of his naivety and rookie status on holding the highest executive office in the country. There is no doubt that the current floundering on Capital Hill and at the White House is now at least partly responsible for the stock market’s dive this year. The direct correlations of the recent severe down days cannot be attributed to the previous administration, but instead to the lack of clarity coming out of Washington. It may be true Obama has inherited the seeds and foundation of the current banking crisis and over extended credit problems spanning back over the last 16 years and two administrations, but the meltdown of the last 30 days is attributable to decisions and speeches he and his administration have made on his watch since taking office in January.
The Dow Jones stock index and S&P both dived last week as well as Monday and now Tuesday of this week to their lowest levels in 12 years which has sparked new rounds of concern and selling reflecting a sentiment with all investors, big and small, that the geniuses we have elected in Washington are flying by the seat of their pants and are NOT inspiring confidence in the financial / business investment communities.
President Obama needs to begin to learn that it is naive to think he can talk openly about complex fiscal matters in his usual condescending fashion without sometimes creating un-intended consequences.
Warren Buffet, aka the Oracle of Omaha, is revered on Wall Street as one of the all time most savvy down to earth investors of the 20th century. What did he have to say today about another severe leg down in the global equity markets? Something akin to… no one noticing that the canary in the coal miner’s cage was dead.
Pre-fabricated home collapse should have made the Fed, Congress and SEC sit up and scream for legislative action. The republicans tried but were shot down by the likes of Senators Barney “Rubble” Franks and Chris “Head in the sand” Dodd.
WARREN BUFFET TODAY — Market Watch
BOSTON (MarketWatch) — Warren Buffett’s ruminations on the battered economy grabbed most of the financial headlines to start the week, but in his annual letter to Berkshire Hathaway shareholders, the folksy investor also offered some thoughts on the public-policy debate raging over how to fix the housing and mortgage markets.
Buffett devoted a section of his highly anticipated missive to the experience and lessons of Clayton Homes — the family-run, manufactured home builder that Berkshire Hathaway acquired in 2003 — during a mortgage crisis that shook the industry in the late 1990s. The debacle “should have served as a canary-in-the-coal-mine warning for the far-larger conventional housing market,” he said.
Manufactured homes — also known as prefabricated, or modular homes — are dwellings that are constructed at a factory and then delivered. Maryville, Tenn.-based Clayton has been building manufactured homes since the 1930s; about a third of its borrowers have subprime credit scores. The builder delivered about 27,500 units last year and has the largest market share, but overall sales in the industry have fallen since they peaked in 1998.
“At that time, much of the industry employed sales practices that were atrocious,” Buffett wrote in his letter to shareholders, released over the weekend.
“To begin with, the need for meaningful down payments was frequently ignored. Sometimes fakery was involved,” he said, pointing to lucrative commissions for salespersons if the loans were approved. “Moreover, impossible-to-meet monthly payments were being agreed to by borrowers who signed up because they had nothing to lose.”
The fallout from this earlier lending spree doesn’t bode well for U.S. home sales if the scenario repeats itself on a larger scale.
Eerie rerun
Buffett explained that manufactured-home mortgages were typically bundled and peddled by Wall Street to investors. This “securitization” of mortgages contributed the late 1990s “fiasco” in manufactured housing.
Conseco, which filed for bankruptcy in 2002, had large exposure to manufactured-home mortgages that went bad. Conseco bought Green Tree Financial Corp. — which specialized in manufactured-housing mortgages and was later called Conseco Finance — in 1998, when sales of mobile homes were booming, thanks in part to loose lending standards.
Investors, the government and rating agencies “learned exactly nothing from the manufactured-home debacle,” wrote Buffett, who often uses narratives when dispensing his wisdom.
“Instead, in an eerie rerun of that disaster, the same mistakes were repeated with conventional homes in the 2004-07 period: Lenders happily made loans that borrowers couldn’t repay out of their incomes, and borrowers just as happily signed up to meet those payments,” he said. “Both parties counted on ‘house-price appreciation’ to make this otherwise impossible arrangement work.”
He said the consequences are now making their way “through every corner of our economy.”
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