What is wrong with Obama?
Feb 11, 2009 11:44:28 GMT -5
Post by edge on Feb 11, 2009 11:44:28 GMT -5
Why does Obama keep telling us that we are in trouble, doesn't everyone know that by now!
One thing that Obama needs to do is to get out of "campaign mode" doesn't he know that he already won! All he does is talk down the economy, and that is something a great leader does not do!
Think of FDR with "the only thing we have to fear is fear itself"!
In my lifetime Ronald Reagan was the best at lifting our Nations spirits and he always had the people on his side because of it.
Personally this fake stimulus plan is only a democrats wish list.
It is a shame Obama did not have his team write a plan and send it to Pelosi to pass or modify, which might have been a bit hard for her to do given his popularity! But by letting her write it he was guaranteed a pork free for all!
Probably the worst thing is the money won't be spent for years, what is with that!!
Then his tax dodging Treasury Secretary comes up with his 2 trillion dollar cockamamie bank bailout scheme
This Geitner two trillion dollar plan seems destined for failure...IMO!
Also IMO, the problem is housing values and their effect on the value of securities.
Since their are probably 30-50 trillion in questionable securities out there, fixing 2 trillion does nothing to fix it!
Now if there was only 2 trillion of trouble securities then yes, this would solve the problem.
My analogy is if there are two banks and two investors:
Bank ONE has 2 million in bad securities that have a current value of 1 million ( but it could go much lower), and they have one depositor with 1 million dollars. This bank can't loan out any more money or risk bankruptcy.
Using the Geitner plan, the depositor sees that he could double his money and the government will guaranty against a loss.
So the depositor buys the bad loans and the bank now is out of debt and has 1 million dollars to loan...problem solved!
Bank TWO has 50 million in bad securities that have a current value of 25 million ( but it could go much lower), and they have one depositor with 1 million dollars. This bank can't loan out any more money or risk bankruptcy.
Using the Geitner plan, the depositor sees that he could double his money and the government will guaranty against a loss.
So the depositor buys 2 million dollars of bad loans BUT, the bank still has 48 million dollars of bad loans...it still can't loan a penny!
Personally, I think that the Fed needs to be the bank. Every bank in the US should write all the GOOD mortgages that they can ( using traditional borrowing standards! 28/34 ratios, good credit, minimum of 10% down, current appraisals, 30 fixed rate ONLY and at under 5%). The banks fund the loans directly from the Federal Reserve ( so they are not using their own funds ), and let the banks service these loans for a couple of years.
This gives the banks income, making them stronger, and it gets money moving TODAY!
Since the banks are not using their own funds, the money supply goes up by about 100 billion per month, and since folks are saving at an accelerated rate the banks will find that they have so much cash they will have to start loaning within a few months or they won't be able to take in deposits.
IF, I said IF that has a positive effect, then target other loans such as the business loans, venture capital, and auto loans. IMO, giving money to the banks did not work, giving money directly to the people last year did not make them spend it.
Give it out ONLY if it gets used.
That is the Edge Plan
One thing that Obama needs to do is to get out of "campaign mode" doesn't he know that he already won! All he does is talk down the economy, and that is something a great leader does not do!
Think of FDR with "the only thing we have to fear is fear itself"!
In my lifetime Ronald Reagan was the best at lifting our Nations spirits and he always had the people on his side because of it.
Personally this fake stimulus plan is only a democrats wish list.
It is a shame Obama did not have his team write a plan and send it to Pelosi to pass or modify, which might have been a bit hard for her to do given his popularity! But by letting her write it he was guaranteed a pork free for all!
Probably the worst thing is the money won't be spent for years, what is with that!!
Then his tax dodging Treasury Secretary comes up with his 2 trillion dollar cockamamie bank bailout scheme
This Geitner two trillion dollar plan seems destined for failure...IMO!
Also IMO, the problem is housing values and their effect on the value of securities.
Since their are probably 30-50 trillion in questionable securities out there, fixing 2 trillion does nothing to fix it!
Now if there was only 2 trillion of trouble securities then yes, this would solve the problem.
My analogy is if there are two banks and two investors:
Bank ONE has 2 million in bad securities that have a current value of 1 million ( but it could go much lower), and they have one depositor with 1 million dollars. This bank can't loan out any more money or risk bankruptcy.
Using the Geitner plan, the depositor sees that he could double his money and the government will guaranty against a loss.
So the depositor buys the bad loans and the bank now is out of debt and has 1 million dollars to loan...problem solved!
Bank TWO has 50 million in bad securities that have a current value of 25 million ( but it could go much lower), and they have one depositor with 1 million dollars. This bank can't loan out any more money or risk bankruptcy.
Using the Geitner plan, the depositor sees that he could double his money and the government will guaranty against a loss.
So the depositor buys 2 million dollars of bad loans BUT, the bank still has 48 million dollars of bad loans...it still can't loan a penny!
Personally, I think that the Fed needs to be the bank. Every bank in the US should write all the GOOD mortgages that they can ( using traditional borrowing standards! 28/34 ratios, good credit, minimum of 10% down, current appraisals, 30 fixed rate ONLY and at under 5%). The banks fund the loans directly from the Federal Reserve ( so they are not using their own funds ), and let the banks service these loans for a couple of years.
This gives the banks income, making them stronger, and it gets money moving TODAY!
Since the banks are not using their own funds, the money supply goes up by about 100 billion per month, and since folks are saving at an accelerated rate the banks will find that they have so much cash they will have to start loaning within a few months or they won't be able to take in deposits.
IF, I said IF that has a positive effect, then target other loans such as the business loans, venture capital, and auto loans. IMO, giving money to the banks did not work, giving money directly to the people last year did not make them spend it.
Give it out ONLY if it gets used.
That is the Edge Plan