While a lot of people are scratching their heads about what went on today with Wall Street’s plunge, it’s easy to map out. It’s the beancounters at it again. Beancounters are an odd branch species of homo sapiens, they are paid to be conservative and think in worst case scenarios, they are paid to think 18-36 months out, and keep the company on course financially in a journey that’s chunked up in three month segments called quarters.
So what is that strange species up too? This is the first working week of the fourth quarter, and most large corporations across America have their beancounters diligently at work putting the final tweaks to the companie’s 2009 budgets. The credit crunch? Most companies have already prepped and planned for that, and that was the discussion two quarters ago to present. If that’s the case, what could cause such a jagged off-the-cliff stutter in the market like we saw today?
Short selling opening up is definitely part of it, but that’s not all of it.
With Obama leading in the polls, every company in the US now has to factor in the effects of the Obama tax increase into their budgets for the next two years, and the beancounters have to do it because they plan for the worst. The Tax increase won’t happen in first quarter, but by third quarter if he’s elected the tax increase will be there.
;”>”Today, he claimed that the Congressional stimulus package was his idea. That’s news to those of us in Congress who supported it. Senator Obama didn’t even show up to vote.
Before you view this remember that the Dems have been in control of congress in the two years leading up to the latest financial debacle. Remember that Joe Biden’s committee should have prevented this, but instead encouraged it. Remember that Barack Obama’s favorite housing advisor is Franklin D. Raines, former CEO of Fannie Mae who got out before the community outreach bad loan stack of cards collapsed. Remember that when the bad news hit Wall St yesterday that Obama was enroute to hobnob with Hollywood Highrollers.
John McCain’s 8 part economic plan, “Jobs for America” can be found here.
Here’s John speaking in Ohio today:
September 16, 2008
John McCain: “We’ve seen a telling moment in this campaign today. Senator Obama saw an economic crisis, and he’s found a political opportunity. My friends, this is not a time for political opportunism; this is a time for leadership.
“Too often, we hear people say America’s in decline. I reject that. I believe America’s best days are ahead of us. Governor Palin and I are going to reform Wall Street. We’re going to reform Washington. I’m going to fight for you, and I’m going to lead our nation forward in the greatest periods of prosperity in its history.
“And let’s have some straight talk. Senator Obama is not interested in the politics of hope, he’s interested in his political future and that’s why he is hurling in insults and making up facts about his record.
“Today, he claimed that the Congressional stimulus package was his idea. That’s news to those of us in Congress who supported it. Senator Obama didn’t even show up to vote.
“He talks a tough game on the financial crisis, but the facts tell a different story. Senator Obama took more money from Fannie Mae and Freddy Mac than anyone but the chairman of the committee they answer to, and he put Fannie Mae’s CEO, who helped create this problem in charge of finding his Vice President. That’s not change, that’s what’s broken in Washington.
“He talked about siding with the people, siding with the people, just before he flew off to Hollywood for a fundraiser with Barbara Streisand and his celebrity friends. Let me tell you, my friends, there’s no place I’d rather be than here, with the working men and women of Ohio. I’m going to fight for you and together we’re going to win in November.”
More on who really created the crisis at Hot Air UPDATE: Here’s Chuckie Schumer and Jesse Jackson teaming up back in 2001 to help create this mess can you say “community organizer?” Under the guise of stopping “predatory lending practices” Obama also participated in legislation like this in 2000. These programs supposedly stiffened controls, but at the same time took away all profitability from higher risk loans. By making it mandatory to treat risky borrowers just like borrowers with good credit through neighborhood HOME and HELP projects they created this crisis.
From the Chicago Tribune, 10-1-2000:
The senator believes that these inclusions will help reduce the number of foreclosures that have occurred in the state. The senator stated that “foreclosures started by subprime lenders in the Chicagoland area increased from 131 in 1993 to 4,958 in 1999, an increase of more than 3,600 percent.”
The senator obtained his foreclosure information from the National Training and Information Center, a non-profit organization in Chicago that does research on housing and other community related issues, including lending and neighborhood safety. It also provides training for those interested in how to do community organizing.
The NTIC currently also works with several affiliate groups, including the Indianapolis-based Organization for a New Eastside which compiles information that it receives from borrowers about their particular lending issues, as well as provides them with education, counseling and advocacy. O.N.E provides no funding to borrowers, though it refers them to local lenders and credit unions after counseling.
O.N.E recently took on the plight of a local family that felt it had been victimized during the purchasing of its home. The organization went to the local branch of the lender for a protest rally, demanding that the loan be looked at again.
So how can I say that when supposedly they were just worried about predatory lending practices and protecting borrowers? One of the things they enforced against was mandatory credit insurance for high risk loans. Without that they guaranteed more foreclosures even though they were supposedly preventing them.
UPDATE:Boston Globe reminds us of the other housing iniatives of Barack Obama UPDATE: Who Supports Barack Obama’s Amazing fund raising abilities? Investment Bankers. UPDATE: McCain Called for reform two years ago, See HERE. UPDATE: Just a reminder that Republicans were calling for oversight of Freddie and Fannie five years ago but were blocked repeatedly by Democrats in Congress:
”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”
Representative Melvin L. Watt, Democrat of North Carolina, agreed.
”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.
The polls are one thing, but it sounds like Barack Obama might make progress in other ways during two ultra-rich Beverly Hills fund-raisers Tuesday. According to Politico, the events could raise more than $9 million, which, if it happens, would be a one-day record.
It is also noteworthy that Obama made a remark about the crisis:
“Eight years of policies that have shredded consumer protections; have brought us to the most serious financial crisis since the Great Depression.”
If things got “shredded” then the Democrat-controlled senate Anti-trust Competition and Consumer Rights Sub Committee helped, and Barack’s running mate, Senator Joe Biden, was a member of that committee.