It's the economy stupid

[ericn1300]

subtitled: The Republicans have screwed it up again
http://news.yahoo.com/s/ap/20080915/...re/wall_street


NEW YORK - A stunning makeover of the Wall Street landscape sent stocks falling precipitously Monday, with the Dow Jones industrials losing 500 points in their worst slide since the September 2001 terrorist attacks. Investors recoiled after a shakeup of the financial industry that took out two storied names: Lehman Brothers Holdings Inc. and Merrill Lynch & Co.

The pullback, which erased about $700 billion in shareholder wealth, occurred across much of the globe as investors absorbed Lehman's bankruptcy filing and what was essentially a forced sale of Merrill Lynch to Bank of America for $50 billion in stock.

Do you really think McSames economic policy will make things better? He insists that the economy is fundamentally strong. http://www.youtube.com/watch?v=igAmVs0cvY8 Watch him dodder through this statement today, even as Wall Street giants collapse and the stock market reels.

The really sad news is the top exec got over $40 million in bonus' just last year and leaves with a 5 year income of over $120 million. Laughing all the way to the bank as the economy tanks. And which party does he belong to? http://www.followthemoney.org/

[BNaylor]

So let me see I have this straight. Lehman Brothers files for bankruptcy causing the stock market to tumble 504 points and it is the Republicans' fault with a Democrat majority Congress? How so? Any proof?

As far as McCain's economic policy working we would be speculating. He has to get elected first. In contrast how would Obama's economic policy be any better? Wall Street needed the rude awakening and it is about time. My 401K plans and stocks and look fine to me. The stock market will recover accordingly.

Here is some interesting information to consider.

Sept. 15, 2008
WASHINGTON - Never has a financial crisis of this magnitude hit so close to a presidential election.

So, as people ponder the latest poll numbers — and the numbers in their 401(k) accounts — the question is whether this will change the contest between Sen. Barack Obama and Sen. John McCain.

Many are wondering how the wizardry of Wall Street financial engineering created such a mess. Even those who don't understand the mechanics of a “credit default swap” could still see frightening turmoil in the stock and bond markets Monday............................................ .................................

Campaign funds from Lehman employees
Obama’s campaign treasury has collected nearly $400,000 in campaign contributions from employees of Lehman Brothers, while McCain campaign has $145,000, according to the Center for Responsive Politics, a non-partisan research group.

http://www.msnbc.msn.com/id/26723715

Sep 11, 2008
Both presidential candidates have gotten a lot of money from Lehman employees -- Democratic candidate Barack Obama to the tune of at least $370,000, and Republican John McCain, $117,000 -- according to the nonpartisan, nonprofit Center for Responsive Politics.

Speculation was making the rounds on Capitol Hill on Thursday about whether the government would come to Lehman's rescue, fueled by Sunday's federal takeover of mortgage giants Fannie Mae and Freddie Mac and the government-engineered rescue of Bear Stearns earlier this year.

House Speaker Nancy Pelosi, a California Democrat, told reporters on Thursday, "I'm hoping that Lehman Brothers will turn around. People that I talk to say they think that it will."

http://www.reuters.com/article/idINN...080911?sp=true

[ericn1300]

Originally Posted by BNaylor

Lehman Brothers files for bankruptcy causing the stock market to tumble 504 points and it is the Republicans' fault with a Democrat majority Congress?

Wrong. The Democrats do not have a majority in Congress. A basic civics lesson in U.S. Government: The United States Congress is the bicameral legislature of the federal government of the United States of America, consisting of two houses, the Senate and the House of Representatives. To have a majority in Congress the Demos would have to have a majority in both houses. They don't as of yet.

The Republicans not only had a majority in Congress for 6 years, they had a Republican President rubber stamping their legislation and they continue to have enough votes to keep the Democrats from over riding any vetoes. The poor shape of the economy lies solely at the feet of the Republicans .

The Republican's over the last 6 years have tried to recreate the “greed is good” days of President Reagan but like most sequels it was a flop.

[thrasher]

Originally Posted by ericn1300

Wrong. The Democrats do not have a majority in Congress. A basic civics lesson in U.S. Government: The United States Congress is the bicameral legislature of the federal government of the United States of America, consisting of two houses, the Senate and the House of Representatives. To have a majority in Congress the Demos would have to have a majority in both houses. They don't as of yet.

The Republicans not only had a majority in Congress for 6 years, they had a Republican President rubber stamping their legislation and they continue to have enough votes to keep the Democrats from over riding any vetoes. The poor shape of the economy lies solely at the feet of the Republicans .

The Republican's over the last 6 years have tried to recreate the “greed is good” days of President Reagan but like most sequels it was a flop.

Whoa there buddy...um, don't know how to tell you this. Have you noticed that the Speaker of the House (Nancy Pelosi) and the Senate Majority Leaders (Harry Reid) are both Demobcrats? That means democrats hold a majority in both houses of Congress.

[ericn1300]

Originally Posted by thrasher

Whoa there buddy...um, don't know how to tell you this. Have you noticed that the Speaker of the House (Nancy Pelosi) and the Senate Majority Leaders (Harry Reid) are both Demobcrats? That means democrats hold a majority in both houses of Congress.

Reid got the nod as majority leader after Lieberman, an independent, went along with the Demos to break the stalemate and seat a majority leader. Now Lieberman flip flops and goes to the RNC and changes sides again. The U.S. Senate is 49 Demos, 49 Repubs. Show me the majority.

[BNaylor]

Originally Posted by ericn1300

Reid got the nod as majority leader after Lieberman, an independent, went along with the Demos to break the stalemate and seat a majority leader. Now Lieberman flip flops and goes to the RNC and changes sides again. The U.S. Senate is 49 Demos, 49 Repubs. Show me the majority.

I don't know about that and disagree with your analysis. Obviously the Democrats have the majority in the House and Senate so I agree with Thrasher. Lieberman still caucuses with the Democrats regardless of his backing of John McCain for President as does Bernie Sanders (I) of Vermont less the McCain part. Bernie Sanders might as well be a Democrat because he almost always votes with the Democrats. Sanders is a democratic socialist. Plus there are procedural matters if they deviate from the agreement to caucus with the Democrats.

That would give the Democrats the 51 votes they need to claim a majority versus 49 Republicans.

They are the majority....period!

[drunken monkey]

how is a the fall of a bank that invested too much sub-prime mortgages the fault of anyone apart from the bank?
The dealings with sub-prime mortgages isn't that grat an indicator of the strength of the economy, it just indicates the risks involved in lending money to people who can't to pay you back and the even higher risk of buying these debts from other banks for the sake of potential profit.

[xeroinfinity]

CNN Breaking News ...

-- The Federal Reserve says it is taking over crumbling insurance giant AIG in an $85 billion rescue plan.

They are nuts !
Our Gov. bails/buys out freddy mac and that other realty giant but they cant help out other giants like Lehman Brothers and Bank Of America...

At least my 401 and stocks are safe... for now.

[BNaylor]

Bank of America bailed out Merrill Lynch by purchasing it for $50 billion.

The problem with Americans is they are quick to lay blame or do a knee jerk reaction especially the politicians for obvious reasons. The stock market closed up 141 points today.

There are plenty of investment banks in good financial status so no great loss in the matter of Lehman Brothers. Not a single dime of taxpayers money should be used to bail them out. Moot issue anyways since they filed for Chapter 11 Bankruptcy. Wall Street needed the rude awakening and adjustment.

It's the greed stupid!!!!

[drunken monkey]

slightly different.

AIG is used by many other banks worldwide to insure their own credit in their buisness dealings. If AIG fails, then globally, banks are going to be in trouble. In fact, this is why AIG must be saved because even small doubts as to whether or not it can honour super senior credit swaps is going to cause major hurt to banks which is another factor in banks being hurt the most in their share prices right now. That 85 Billion is only about a quarter of what they are contracted to insure.

With Lehman Brothers, Banks are just wondering how much money they are owed and how long it will take to get it back which is why Lehman Brother's demise causing share prices to fall isn't really an indicator of the strength of the economy. It is more to do with the fluidity of transactions in the economy.

Wasn't the buying of Merril Lynch a forced action?
It seemed odd to me that the US government didn't allow (or force) another similar action with Lehman Brothers because some very able banks were very willing to do just that.

[xeroinfinity]

I would agree our Gov should Not bail anyone out, its thier own fault they are in bankruptcy. Our tax dollars are spread thin enough as it is.

You know, I havent seen any AIG commercials on TV lately...hummm..

[BNaylor]

Originally Posted by drunken monkey

Wasn't the buying of Merril Lynch a forced action?
It seemed odd to me that the US government didn't allow (or force) another similar action with Lehman Brothers because some very able banks were very willing to do just that.

Here is the press release from BA and a video of the CEOs explaining the deal.

http://newsroom.bankofamerica.com/in...ases&item=8255

http://www.youtube.com/watch?v=MtGPm6sh5C0

[ericn1300]

Originally Posted by BNaylor

They are the majority....period!

You sound like my wife now, if you're having your period, but nothing is that absolute in politics. As a Texan you should know better.

[BNaylor]

Originally Posted by ericn1300

You sound like my wife now, if you're having your period, but nothing is that absolute in politics. As a Texan you should know better.

You ought to see mine on the rag. ........

After the 2008 elections since House and Senate seats are up for grabs I'm quite sure there will be another change of scenery......I mean seats.

Originally Posted by drunken monkey

With Lehman Brothers, Banks are just wondering how much money they are owed and how long it will take to get it back which is why Lehman Brother's demise causing share prices to fall isn't really an indicator of the strength of the economy. It is more to do with the fluidity of transactions in the economy.

Excellent analysis. You're hired!

[drunken monkey]

well... my point is, the way the banking system works, that owed money will be paid back eventually and is only missing until they've figured out how much and who is going to take over the debts.
It is more a sign of caution in the short term rather than showing overall weakness as ericn1300 is suggesting.

Well, it made more sense when my sister explained it to me....