Archive for the '2008 Government Bailout' Category
Where Does the $700 Billion Bailout Size Come From?
Here’s an example of the absolute recklessness of the current bailout mess. An article from Forbes ought to make all Americans go berserk on the members of Congress that are voting in favor of this thing:
In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.
“It’s not based on any particular data point,” a Treasury spokeswoman told Forbes.com Tuesday. “We just wanted to choose a really large number.”
Are you &*#%@%^ kidding me?!?!
Posted by: GRPundit on Thursday, 2nd Oct, 2008
Giant Socialist Bailout: Levin YES, Stabenow NO
Josef Stalin is pleased with the United States Senate today
The giant socialist bailout bill passed the Senate yesterday 75 to 24. Senator Carl Levin voted YES, Senator Debbie Stabenow noted NO.
Call Senator Stabenow and say thanks! 202-224-4822. Email her here.
Call/write Senator Levin now and tell him that Josef Stalin would be proud! (202) 224-6221 (Fax him at 202-224-1388) Email him here.
Call the US House’s switchboard at (202) 224-3121 and ask to speak with your Congressperson’s office. Tell him or her to vote no on this monstrosity.
Josef Stalin would be proud of the US Senate today. Hopefully it’s not too late to stop the statist/socialist cabal in Washington that is governing by fear and ignorance.
Further reading:
Posted by: GRPundit on Thursday, 2nd Oct, 2008
Bailout Reader
(Note: this post is taken from the Ludwig von Mises Institute’s economic blog)
The events taking place in the financial market offer an illustration of the soundness of the Austrian theory of money, banking, and credit cycles, and Mises.org is your source not only for analysis of these events but also the economic theory that helps explain what is happening and what to do about it. There are many thousands of articles available, and also the full text of thousands of books as well as journal articles. It is impossible to draw attention to the full range of literature one can use to understand the crisis.
However, below we offer a brief look into the topics most discussed in these times, with extended treatments of each in the sidebar. Mises.org also offers both a blog and a community forum for reading and discussing them all.
It’s never been more important to spread a sound view of money and banking, not only as a protection against the fallacies of “stabilization” and “reflation” but also as way to see what kind of reforms are essential now.
Fannie Mae and Freddie Mac
- Freddie Mac: A Mercantilist Enterprise, by Paul Cleveland, March 14, 2005
- Fannie Mae: Another New Deal Monstrosity, by Karen De Coster, July 2, 2007
- How Fannie and Freddie Made Me a Grumpy Economist, by Christopher Westley, July 21, 2008
- Who Made the Fannie and Freddie Threat? By Frank Shostak, March 5, 2004
- Are Fannie and Freddie Too Big to Fail? By Frank Shostak, September 17, 2008
- Fannie Mae Distorts Markets, by Robert Blumen, June 17, 2002
The Housing Bubble
- The Housing Bubble in Four Easy Steps, by Mark Thornton, September 27, 2008
- The Real Cost of a Full Bailout, by Don Rich, August 22, 2008
- The Subprime Mortgage “Crisis” Will Fix Itself, by Steve Berger, May 30, 2007
- Did the Fed Cause the Housing Bubble? By Robert Murphy, April 14, 2008
- The Mortgage Market Mess, by Christopher Westley, May 17, 2007
- Housing Bubble: Myth or Reality? By Frank Shostak, March 4, 2003
Inflationary Finance
- What’s Behind the Financial Market Crisis? by Antony Mueller, September 18, 2008
- Our Financial House of Cards, by George Reisman, March 25, 2008
- Will Central Bankers Become Central Planners? by Robert Blumen, July 31, 2008
- Inflation is a Policy that Cannot Last, by Thorsten Polleit, March 14, 2008
- The Widening Safety Net, by Christopher Mayer, March 19, 2004
- The Fed’s New Tricks Are Creating Disaster, Frank Shostak, March 18, 2008
- The Fed’s War on the Middle Class, by Mark Thornton, June 4, 2008.
- Austrian Economics and Financial Markets conference at The Venetian Hotel Resort Casino, Las Vegas, 02-18-2005
Community Reinvestment Act
- The CRA Scam and its Defenders, by Thomas DiLorenzo, April 30, 2008
- Regulatory Sneak Attack, by Thomas DiLorenzo, September 16, 1999
Short Selling
- Short-Sale Restrictions Are an Exercise in Naked Power, by Robert Murphy, August 11, 2008
- The Social Function of Futures Markets, by Robert Murphy, November 29, 2006
- Don’t Sell Short Selling Short, by Gary Galles, April 6, 2007
The Austrian Theory of the Business Cycle
- The Idiocy of Wall Street, by Don Rich, September 24, 2008
- The Fed is Culpable, by Hans F. Sennholz, November 11, 2002
- Skyscrapers and Business Cycles, by Mark Thornton, August 23, 2008
- Economic Outlook 2008: Darkening Clouds, Dominick Armentano, January 2, 2008
- Business Cycle Primer, Llewellyn H. Rockwell, Jr. February 8, 2001
- Economics Depressions: Their Cause and Cure, by Murray Rothbard
Who Predicted This?
- The Financial Apocalyptics are Back, Robert Blumen, July 25, 2007
- Sowing the Seeds of the Next Crisis, Thorsten Polleit, April 25, 2006
- Credit Crisis: Precursor of Great Inflation, by Thorsten Polleit, February 7, 2008
- Mr. Bailout, by Anton Mueller, September 30, 2004
- America’s Unsustainable Boom, by Stefan Karlsson, November 8, 2004
- Who Predicted the Bubble? Who Predicted the Crash? By Mark Thornton, July 14, 2003
What To Do
- Don’t Bail Them Out, by Llewellyn H. Rockwell, Jr., September 10, 2008
- How to Avoid Another Depression, by Mark Thornton, September 10, 2008
- Taking Money Back, By Murray N. Rothbard, June 14, 2008
- Beware the Alchemists, by Ludwig von Mises, February 3, 2006
- Reflation in American History, by H.A. Scott Trask, October 31, 2003
- Money and Freedom, by Joseph Salerno, February 2, 2002
- The Case for a Genuine Gold Dollar, by Murray Rothbard
Books to Distribute
- The Theory of Money and Credit, by Ludwig von Mises
- America’s Great Depression, by Murray Rothbard
- The Mystery of Banking, by Murray Rothbard
- Prices and Production, by F.A. Hayek
- Causes of the Economic Crisis, by Ludwig von Mises
- Austrian Theory of the Trade Cycle and Other Essays, by Ludwig von Mises, et al.
- Understanding the Dollar Crisis, by Percy Greaves
- The Case Against the Fed, by Murray Rothbard
- Money, Bank Credit, and Economic Cycles, by Jesus Huerta de Soto
- History of American Currency, by William Graham Sumner
- Banking and the Business Cycle, by C.A. Phillips
- Fiat Money Inflation in France, by Andrew Dickson White
Posted by: GRPundit on Monday, 29th Sep, 2008
Who Voted For/Against the Bailout
- Democrats — Conyers, N; Dingell, Y; Kildee, Y; Kilpatrick, N; Levin, Y; Stupak, N.
- Republicans — Camp, Y; Ehlers, Y; Hoekstra, N; Knollenberg, N; McCotter, N; Miller, N; Rogers, N; Upton, Y; Walberg, N.
Posted by: GRPundit on Monday, 29th Sep, 2008
Failure of Capitalism, or Failure of Government?
We here at GR Pundit have made it a general policy to comment and report on local issues only. However, the extent and scope of the current market crisis requires that we break that policy.
What is the origin of the current economic crisis? Is it capitalism run amok? No. It is government run amok. As with so many economic failures, this crisis has its roots in two government programs - Fannie Mae and Freddie Mac. We will say this categorically: this economic crisis would not be happening if those two entities had not been created by (and implicitly guaranteed by) the federal government. This is not a failure of capitalism, it is a failure of government. This is what happens when the government interferes with the market.
Read a New York Times article from 1999 to understand exactly what started this mess.
In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.
”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”
…
Fannie Mae, the nation’s biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.
A few more resources on this gigantic destructive government failure:
- Are Fannie and Freddie Too Big to Fail?
- Understanding the Crisis
- What’s Behind the Financial Market Crisis?
Just remember - it is government (the Federal Reserve) that created the Great Depression, it is government (FDR’s “New Deal”) that extended the Depression to last over 15 years, it is government that created this credit crisis. The government needs to get out of the way and allow the market to correct. Fannie Mae and Freedie Mac need to be liquidated and terminated. It is only when true market mechanisms are allowed to work will we come out of this crisis. “A bailout in every pot” will only prolong the pain.
Posted by: GRPundit on Wednesday, 24th Sep, 2008
