[Rhodes22-list] Bob Skinner said, "

Thu Oct 2 12:24:27 EDT 2008

Wally,

Marsha Blackburn voted against it, I'd call her office but I'm not
sure there's a clear answer.  Buffet says the problem is real but then
he's not a disinterested party.  The other Buffet is probably saying,
"lets party!" I tend to lean toward getting the "toxic" assets off the
books and give the real estate market a couple of years to digest
everything. Being in the majority and having "control" is two
different animals.  There's no shortage of blame to go around, that's
for sure.  I do think that allowing any single entity to get so big
that "it's too big to fail" is a mistake. Now would be a perfect time
to resurrect the idea of term limits. How else can one explain Pelosi?

Maybe we should just have a beauty pageant.  I think my congressman
(Marsha) would win.

Brad

On Thu, Oct 2, 2008 at 10:48 AM, TN Rhodey <tnrhodey at gmail.com> wrote:
> Ed,  It seems to me that for 6 out of the last 8 years we have had the right
> control every branch of Federal Government. Selective quotes may make you
> feel better but maybe you might want to ask why those in control of the
> White House, Senate, and House did not rise up together and fix the problem?
> Face it Ed, both sides are wearing clown paint.
>
> How did your guy vote on this? My local indicator is my Rep. Congressman Jim
> Duncan. I know you think I am a socialist but I generally vote Republican.
> I disagreed with Bush on Iraq. Things have played out pretty much as should
> have been predicted. ....Anyway I vote for  Duncan every time because he is
> pretty much against everything. He was one of the few on the right (or
> left) that had the courage to break ranks with his peers and vote against
> Iraq from day one. He is not a high profile guy, and is both fiscally and
> socially conservative. He voted no on the bail out. My gut tells me that we
> should let this whole thing ride and see just what happens. I don't trust
> accounting changes to fix a house of cards. What is your take?
>
> Wally
>
> On Thu, Oct 2, 2008 at 11:06 AM, Brad Haslett <flybrad at gmail.com> wrote:
>
>> Ed,
>>
>> >From the WSJ today - Freddie and Fannie Mayhem
>>
>> Brad
>>
>> -------------------
>>
>>
>>
>>
>> House Financial Services Committee hearing, Sept. 10, 2003:
>>
>> Rep. Barney Frank (D., Mass.): I worry, frankly, that there's a
>> tension here. The more people, in my judgment, exaggerate a threat of
>> safety and soundness, the more people conjure up the possibility of
>> serious financial losses to the Treasury, which I do not see. I think
>> we see entities that are fundamentally sound financially and withstand
>> some of the disaster scenarios. . . .
>>
>>
>>
>> Rep. Maxine Waters (D., Calif.), speaking to Housing and Urban
>> Development Secretary Mel Martinez:
>>
>> Secretary Martinez, if it ain't broke, why do you want to fix it? Have
>> the GSEs [government-sponsored enterprises] ever missed their housing
>> goals?
>> * * *
>>
>> House Financial Services Committee hearing, Sept. 25, 2003:
>>
>> Rep. Frank: I do think I do not want the same kind of focus on safety
>> and soundness that we have in OCC [Office of the Comptroller of the
>> Currency] and OTS [Office of Thrift Supervision]. I want to roll the
>> dice a little bit more in this situation towards subsidized housing. .
>> . .
>> * * *
>>
>> House Financial Services Committee hearing, Sept. 25, 2003:
>>
>> Rep. Gregory Meeks, (D., N.Y.): . . . I am just pissed off at Ofheo
>> [Office of Federal Housing Enterprise Oversight] because if it wasn't
>> for you I don't think that we would be here in the first place.
>> [nowides]
>> Fannie Mayhem: A History
>>
>> A compendium of The Wall Street Journal's recent editorial coverage of
>> Fannie and Freddie.
>>
>> And Freddie Mac, who on its own, you know, came out front and
>> indicated it is wrong, and now the problem that we have and that we
>> are faced with is maybe some individuals who wanted to do away with
>> GSEs in the first place, you have given them an excuse to try to have
>> this forum so that we can talk about it and maybe change the direction
>> and the mission of what the GSEs had, which they have done a
>> tremendous job. . .
>>
>> Ofheo Director Armando Falcon Jr.: Congressman, Ofheo did not
>> improperly apply accounting rules; Freddie Mac did. Ofheo did not try
>> to manage earnings improperly; Freddie Mac did. So this isn't about
>> the agency's engagement in improper conduct, it is about Freddie Mac.
>> Let me just correct the record on that. . . . I have been asking for
>> these additional authorities for four years now. I have been asking
>> for additional resources, the independent appropriations assessment
>> powers.
>>
>> This is not a matter of the agency engaging in any misconduct. . . .
>>
>> Rep. Waters: However, I have sat through nearly a dozen hearings
>> where, frankly, we were trying to fix something that wasn't broke.
>> Housing is the economic engine of our economy, and in no community
>> does this engine need to work more than in mine. With last week's
>> hurricane and the drain on the economy from the war in Iraq, we should
>> do no harm to these GSEs. We should be enhancing regulation, not
>> making fundamental change.
>>
>> Mr. Chairman, we do not have a crisis at Freddie Mac, and in
>> particular at Fannie Mae, under the outstanding leadership of Mr.
>> Frank Raines. Everything in the 1992 act has worked just fine. In
>> fact, the GSEs have exceeded their housing goals. . . .
>>
>> Rep. Frank: Let me ask [George] Gould and [Franklin] Raines on behalf
>> of Freddie Mac and Fannie Mae, do you feel that over the past years
>> you have been substantially under-regulated?
>>
>> Mr. Raines?
>>
>> Mr. Raines: No, sir.
>>
>> Mr. Frank: Mr. Gould?
>>
>> Mr. Gould: No, sir. . . .
>>
>> Mr. Frank: OK. Then I am not entirely sure why we are here. . . .
>>
>> Rep. Frank: I believe there has been more alarm raised about potential
>> unsafety and unsoundness than, in fact, exists.
>> * * *
>>
>> Senate Banking Committee, Oct. 16, 2003:
>>
>> Sen. Charles Schumer (D., N.Y.): And my worry is that we're using the
>> recent safety and soundness concerns, particularly with Freddie, and
>> with a poor regulator, as a straw man to curtail Fannie and Freddie's
>> mission. And I don't think there is any doubt that there are some in
>> the administration who don't believe in Fannie and Freddie altogether,
>> say let the private sector do it. That would be sort of an ideological
>> position.
>>
>> Mr. Raines: But more importantly, banks are in a far more risky
>> business than we are.
>> * * *
>>
>> Senate Banking Committee, Feb. 24-25, 2004:
>>
>> Sen. Thomas Carper (D., Del.): What is the wrong that we're trying to
>> right here? What is the potential harm that we're trying to avert?
>>
>> Federal Reserve Chairman Alan Greenspan: Well, I think that that is a
>> very good question, senator.
>>
>> What we're trying to avert is we have in our financial system right
>> now two very large and growing financial institutions which are very
>> effective and are essentially capable of gaining market shares in a
>> very major market to a large extent as a consequence of what is
>> perceived to be a subsidy that prevents the markets from adjusting
>> appropriately, prevents competition and the normal adjustment
>> processes that we see on a day-by-day basis from functioning in a way
>> that creates stability. . . . And so what we have is a structure here
>> in which a very rapidly growing organization, holding assets and
>> financing them by subsidized debt, is growing in a manner which really
>> does not in and of itself contribute to either home ownership or
>> necessarily liquidity or other aspects of the financial markets. . . .
>>
>> Sen. Richard Shelby (R., Ala.): [T]he federal government has [an]
>> ambiguous relationship with the GSEs. And how do we actually get rid
>> of that ambiguity is a complicated, tricky thing. I don't know how we
>> do it.
>>
>> I mean, you've alluded to it a little bit, but how do we define the
>> relationship? It's important, is it not?
>>
>> Mr. Greenspan: Yes. Of all the issues that have been discussed today,
>> I think that is the most difficult one. Because you cannot have, in a
>> rational government or a rational society, two fundamentally different
>> views as to what will happen under a certain event. Because it invites
>> crisis, and it invites instability. . .
>>
>> Sen. Christopher Dodd (D., Conn.): I, just briefly will say, Mr.
>> Chairman, obviously, like most of us here, this is one of the great
>> success stories of all time. And we don't want to lose sight of that
>> and [what] has been pointed out by all of our witnesses here,
>> obviously, the 70% of Americans who own their own homes today, in no
>> small measure, due because of the work that's been done here. And that
>> shouldn't be lost in this debate and discussion. . . .
>> * * *
>>
>> Senate Banking Committee, April 6, 2005:
>>
>> Sen. Schumer: I'll lay my marker down right now, Mr. Chairman. I think
>> Fannie and Freddie need some changes, but I don't think they need
>> dramatic restructuring in terms of their mission, in terms of their
>> role in the secondary mortgage market, et cetera. Change some of the
>> accounting and regulatory issues, yes, but don't undo Fannie and
>> Freddie.
>> * * *
>>
>> Senate Banking Committee, June 15, 2006:
>>
>> Sen. Robert Bennett (R., Utah): I think we do need a strong regulator.
>> I think we do need a piece of legislation. But I think we do need also
>> to be careful that we don't overreact.
>>
>> I know the press, particularly, keeps saying this is another Enron,
>> which it clearly is not. Fannie Mae has taken its lumps. Fannie Mae is
>> paying a very large fine. Fannie Mae is under a very, very strong
>> microscope, which it needs to be. . . . So let's not do nothing, and
>> at the same time, let's not overreact. . .
>>
>> Sen. Jack Reed (D., R.I.): I think a lot of people are being
>> opportunistic, . . . throwing out the baby with the bathwater, saying,
>> "Let's dramatically restructure Fannie and Freddie," when that is not
>> what's called for as a result of what's happened here. . . .
>>
>> Sen. Chuck Hagel (R., Neb.): Mr. Chairman, what we're dealing with is
>> an astounding failure of management and board responsibility, driven
>> clearly by self interest and greed. And when we reference this issue
>> in the context of -- the best we can say is, "It's no Enron." Now,
>> that's a hell of a high standard.
>>
>> On Thu, Oct 2, 2008 at 8:41 AM, Tootle <ekroposki at charter.net> wrote:
>> >
>> > Bob Skinner said, "I must admit that I will not be satisfied with any
>> > solution that does not severely penalize those who
>> > sat on top of this pile of paper with their golden
>> > parachutes.  The very existence of the parachutes
>> > is evidence that they had no confidence that the
>> > market would survive their mismanagement.
>> >
>> > And I know that I have a lot of company in that
>> > sentiment.
>> >
>> > Those of us who believe in good pay for good work
>> > are bent beyond tolerance by the obvious disregard
>> > for merit in determining executive pay at the top.
>> > A double standard if I ever saw one, the antithesis
>> > of the classless society we flaunt to the rest of
>> > the world.
>> >
>> > I smell revolution - bloodless, I hope, but
>> > nevertheless with sharp teeth and a great hunger
>> > for revenge.
>> >
>> > As the French once said, heads will roll.  And
>> > the first will be those of the legislators who do
>> > not enact appropriate penalties and limitations
>> > during the process of rebuilding our financial
>> > structure.
>> >
>> > There should be no free ride for either the
>> > lenders who made ill-advised loans, or the fools
>> > who took the money and mis-spent it.
>> >
>> > /Robert
>> >
>> > What Bob Skinner DID NOT SAY:
>> >
>> > Here is a quick look into 3 former Fannie Mae executives who have brought
>> > down Wall Street.
>> >
>> > Franklin Raines was a Chairman and Chief Executive Officer at Fannie Mae.
>> > Raines was forced to retire from his position with Fannie Mae  when
>> auditing
>> > discovered severe irregulaties in Fannie Mae's accounting activities. At
>> the
>> > time of his departure The Wall Street Journal noted, " Raines, who long
>> > defended the company's accounting despite mounting evidence that it
>> wasn't
>> > proper, issued a statement late Tuesday conceding that "mistakes were
>> made"
>> > and saying he would assume responsibility as he had earlier promised.
>> News
>> > reports indicate the company was under growing pressure from regulators
>> to
>> > shake up its management in the wake of findings that the company's books
>> ran
>> > afoul of generally accepted accounting principles for four years."
>>  Fannie
>> > Mae had to reduce its surplus by $9 billion.
>> >
>> > Raines left with a "golden parachute valued at $240 Million in benefits.
>> The
>> > Government filed suit against Raines when the depth of the accounting
>> > scandal became clear. http://housingdoom.com/2006/12/18/fannie-charges/.
>> > The Government noted, "The 101 charges reveal how the individuals
>> improperly
>> > manipulated earnings to maximize their bonuses, while knowingly
>> neglecting
>> > accounting systems and internal controls, misapplying over twenty
>> accounting
>> > principles and misleading the regulator and the public. The Notice
>> explains
>> > how they submitted six years of misleading and inaccurate accounting
>> > statements and inaccurate capital reports that enabled them to grow
>> Fannie
>> > Mae in an unsafe and unsound manner."  These charges were made in 2006.
>>  The
>> > Court ordered Raines to return $50 Million Dollars he received in bonuses
>> > based on the miss-stated Fannie Mae profits.
>> >
>> > Tim Howard -  Was the Chief Financial Officer of Fannie Mae. Howard "was
>> a
>> > strong internal proponent of using accounting strategies that would
>> ensure a
>> > "stable pattern of earnings" at Fannie. In everyday English - he was
>> cooking
>> > the books.  The Government Investigation determined that, "Chief
>> Financial
>> > Officer, Tim Howard, failed to provide adequate oversight to key control
>> and
>> > reporting functions within Fannie Mae,"
>> >
>> > On June 16, 2006, Rep. Richard Baker, R-La., asked the Justice Department
>> to
>> > investigate his allegations that two former Fannie Mae executives lied to
>> > Congress in October 2004 when they denied manipulating the
>> mortgage-finance
>> > giant's income statement to achieve management pay bonuses.
>> Investigations
>> > by federal regulators and the company's board of directors since
>> concluded
>> > that management did manipulate 1998 earnings to trigger bonuses. Raines
>> and
>> > Howard resigned under pressure in late 2004.
>> > Howard's Golden Parachute was estimated at $20 Million!
>> >
>> > Jim Johnson -   A former executive at Lehman Brothers and who was later
>> > forced from his position as Fannie Mae CEO.   A look at the Office of
>> > Federal Housing Enterprise Oversight's May 2006 report on mismanagement
>> and
>> > corruption inside Fannie Mae, and you'll see some interesting things
>> about
>> > Johnson. Investigators found that Fannie Mae had hidden a substantial
>> amount
>> > of Johnson's 1998 compensation from the public, reporting that it was
>> > between $6 million and $7 million when it fact it was $21 million."
>> > Johnson is currently under investigation for taking illegal loans from
>> > Countrywide while serving as CEO of Fannie Mae.
>> >
>> > Johnson's Golden Parachute was estimated at $28 Million.
>> >
>> > WHERE ARE THEY NOW?
>> >
>> > FRANKLIN RAINES? Raines works for the Obama Campaign as Chief Economic
>> > Advisor
>> > TIM HOWARD?  Howard is also a Chief Economic Advisor to Obama
>> > JIM JOHNSON?  Johnson hired as a Senior Obama Finance Advisor and was
>> > selected to run Obama's Vice Presidential Search Committee[until public
>> > clamor]
>> >
>> > IF OBAMA PLANS ON CLEANING UP THE MESS - HIS ADVISORS HAVE THE EXPERTISE
>> -
>> > THEY MADE THE MESS IN THE FIRST PLACE.   Would you trust the men who tore
>> > Wall Street down to build the New Wall Street ?
>> >
>> > Pay close attention because should Obama be elected you will see more of
>> > these three, if they are not indicted,. tried and incarcerated.
>> >
>> > Ed K
>> > Greenville, SC, USA
>> > attachment:
>> > http://www.nabble.com/file/p19779478/Peter%2Band%2BBen.jpgPeter+and+Ben.jpg
>> > --
>> > View this message in context:
>> http://www.nabble.com/Bob-Skinner-said%2C-%22-tp19779478p19779478.html
>> > Sent from the Rhodes 22 mailing list archive at Nabble.com.
>> >
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