If it wasn't for democrats pushing for loans to the poor, there would not have been a need for a bailout either. I don't see the need for a bailout anyway. The latter half of the 90's was much different than the first half, and the latter half was dominated by a republican congress. There was a tax cut in 97. great article here: http://www.safehaven.com/showarticle.cfm?id=11722&pv=1 I am not a big fan of whole article cut and paste but I like this Let's sum it up. Here is what faces President Obama. The economy is in a recession that is getting worse by the day. This is the first consumer-led recession in 27 years. Unemployment is rising and the time between jobs is probably over ten months by the time he takes office. The US deficit is likely to be soaring above $500 billion. Consumers are retrenching, hit by the double whammy of falling home prices and seriously lower stock values and retirement savings. You will not have the luck of George Bush to have consumers borrow $500 billion a year from their homes and resort to a negative savings rate. Banks will be cutting back on consumer lending, and consumers will be cutting back on spending and increasing their savings. The economy is unlikely to begin even a slow recovery until later in 2009, without serious and continuous large deficit-busting stimulus packages. Even then, the recovery is going to be prolonged, because the causes of the recession are the bursting of the twin bubbles of the housing and credit markets. These problems cannot be solved in a short amount of time. It will be several years into your administration before the housing market recovers, and the credit markets will be on life support for some time. The Fed has run up its balance sheet by over a trillion dollars. Interest rates have been cut to less than 1%. There is no cavalry coming from the Fed to save the economy with more rate cuts. What are your options? You have made promises to various constituencies. One is a tax cut for 95% of Americans. The problem is that 47% of Americans do not pay taxes, so what you are really talking about it a massive expansion of welfare. But if you use that tax increase on the "rich" to pay for your "tax cuts" to other Americans, you have no money to pay for other programs, let alone get anywhere close to a balanced budget. And of course, as each year passes there is less net Social Security income to the government. If you use your tax increase to fund more expenses today, you will not have that to fund Social Security in 2017 when the program goes into a cash-flow deficit. Or, taxes will really have to rise later in the decade. But then again, that will be another president's problem. How do you offer the increased medical programs you propose if you use the tax increase for tax cuts for 95% of Americans (read: welfare for 50%) without really busting the budget? Or any of the $600 billion in programs that you want to see? And your serious economic advisors are going to point out (at least in private) that raising taxes on the 5% of wealthiest Americans is eerily similar to what Herbert Hoover did in his administration, along with legislation to restrict free trade and increase tariffs, which you have also advocated. Look where that got him and the country. 75% of those "rich" you are targeting are actually small businesses that account for 50-75% (depending on how you measure growth) of the net new job growth in the US. When you tax them, you limit their ability to grow their businesses. Further, you reduce their ability to consume at a time when consumer spending is already negative. in short, it looks like we are screwed
So a growing small business is going to be netting the owner (not a corporation, but a sole proprietership) 250K a year, and the 3% extra in taxes is going to keep the business from expanding. Really? Whatever happened to the concept of living at least 10% below your means as the way to get rich in the long run? The big lie is the republicans are trying to confuse the voters to think the tax will be on gross receipts, not the net profits of the business after all expenses. There are plenty of small businesses that generate well over several million dollars in receipts, gross revenues, yet the net to the owner is generally less than a couple hundred K. If some idiot business owner can't overcome a 3% tax increase on their personal income, then they are living way beyond their actual means...
So a growing small business is going to be netting the owner (not a corporation, but a sole proprietership) 250K a year, and the 3% extra in taxes is going to keep the business from expanding. Really? Whatever happened to the concept of living at least 10% below your means as the way to get rich in the long run? The big lie is the republicans are trying to confuse the voters to think the tax will be on gross receipts, not the net profits of the business after all expenses. There are plenty of small businesses that generate well over several million dollars in receipts, gross revenues, yet the net to the owner is generally less than a couple hundred K. If some idiot business owner can't overcome a 3% tax increase on their personal income, then they are living way beyond their actual means... You have a point that an extra 3% to a guy making $500K a year net may not mean a whole lot to him personally in terms of lifestyle -if that was the only consideration, but you miss the much larger picture. First that amount does nothing to solve the larger problems, does not promote growth, probably will not pay for all the other giveaways he has promised, and most likely will not generate the projected revenue since as you point out, all the owner has to do is hide it withing the gross somehow. We all do it, if we could avoid paying an extra $100K to the gov't, we'll find a way. The 3% is cap gains, not income tax. Raising cap gains 3% won't do shit in terms of gov't revenue, and that's a big lie promoted by demos. As for inome tax, a guy netting a million might pay more than an extra 3%. We are going broke with entitlements, bailouts, and giveaways. Hussein wants more of that.
Ha. This is the single largest misconception I see around here...that somehow subprime loans are at the heart of all this. Subprime loans represent about 6% of all loans in the US. As of july their have been what, around $450 Billion in losses due to subprime loans? Ha. You think that paltry sum is the cause of this and whats ahead? Don't even get me started on the soon to implode $50 trillion, completely unregulated credit default swap market. Furthermore the lenders were not forced into anything. I'll give you that loans for the poor didn't help the situation, but lending companies were PRINTING MONEY by buying and quickly selling these loans to the under regulated, over leveraged secondary market. You seem to be under the elementary assumption that banks have money, they loan it to you and you pay them interest. HA! If only it were that simple. Back when I was a broker 95% of the "lenders" I used were correspondent lenders. They simply served as a gatherer and temporary holder of debts, before they were sold as packages on the secondary market and turned in to collateralized mortgage obligations. Fannie mae? lol please, I never did a single FNMA loan. Hardly anyone did. There was no point, the FNMA guidelines (conforming) were FAR stricter than the ones I had to follow in order to start the above mentioned process. huh? subprimes are the cause of this problem, they are why the CDS market was created in the first place, and most everyone except you agrees that lending money to uncreditworthy people was a root problem. 6% of loans in default is an enormous problem. Lenders were forced into making loans, just look at the history of Clinton and the CRA. Fannie had a pivotal role in guaranteeing those shitty loans and buying up the the securities. You didn't deal with Fannie directly because you didn't have to, they bought and guaranteed the loans after they were bundled. To claim subprime and fannie had little role is just plain ridiculous
Liberals don't want to be blamed for subprime crisis. Liberals say reason for financial crisis has nothing to do with the subprimes. You guys aren't even good at lying. If your going to lie than make it good. Simply lying by stating that the whole financial crisis is unrelated to subprimes is clearly laughable. This is of comic proportions.
I'm not just some snot nosed 21 year old. I may be that, but I funded millions of dollars in alt-a and subprime loans every year as a teenager through my own company. Believe it or not, there are some markets out there that I am very familiar with. Of course now I'm all about NQ, but thats a separate conversation.
Is this your theme song? My momma talkin to me tryin to tell me how to live But I don't listen to her cause my head is like a sieve My daddy he disowned me cause I wear my sister's clothes He caught me in the bathroom with a pair of pantyhose My basketball coach he done kicked me off the team For wearing high heeled sneakers and acting like a queen The world's comin to an end and I don't even care As long as I can have a limo and my orange hair And it don't bother me if people think I'm funny Cause I'm a big rock star and I'm making lots of money Money (x5) I'm so bloody rich I own apartment buildings and shopping centers And I only know three chords