Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Just the Facts, Ma'am: A Compendium of Liberal Fiction -- Ignore unavailable to you. Want to Upgrade?

To: Sully- who wrote (69792)	2/23/2009 5:28:05 PM
From: Joe Btfsplk	1 Recommendation Read Replies (1) \| Respond to of 90947

Media Credibility, Not Ice Caps, In Meltdown Sully, that heresy is contrary to The One True Religion, thus is crap; meaningless and irrelevant. Shouldn't even be read by decent folk!

To: Sully- who wrote (69792)	2/23/2009 5:41:31 PM
From: Sully-	2 Recommendations Respond to of 90947

KUDLOW: Subsidizing bad behavior Lawrence Kudlow The Washington Times Monday, February 23, 2009 COMMENTARY: President Obama's massive mortgage-bailout plan is nothing more than a thinly disguised entitlement program that redistributes income from the responsible 92 percent of home-owning mortgage holders who pay their bills on time to the irresponsible defaulters who bought more than they could ever afford. This is Obama's spread-the-wealth program in action. Team Obama is rewarding bad behavior. It is enlarging moral hazard. It is expanding its welfarist approach to economic policy. And with a huge expansion of government-owned zombie lenders Fannie Mae and Freddie Mac, Team Obama is taking a giant step toward nationalizing the mortgage market. Reporting from the Chicago commodity pits, my CNBC colleague Rick Santelli unleashed a torrent of criticism over this scheme. Mr. Santelli said: "Government is promoting bad behavior. ... Do we really want to subsidize the losers' mortgages? This is America! How many of you people want to pay for your neighbor's mortgage? President Obama, are you listening? How about we all stop paying our mortgages! It's a moral hazard." All this took place on the air to the cheers of traders. Mr. Santelli called for a new tea party in support of capitalism. He's right. Mr. Obama's so-called mortgage-rescue plan amounts to $275 billion in new debt that will have little if any lasting impact on deeply corrected housing prices or the mortgage-default problem that stemmed from the insistence of government to throw home loans at lower-income people. A modest reduction in mortgage rates will have little impact on home prices, as Harvard professor Ed Glaser has shown. And by the way, re-default rates on modified mortgages have been running at between 50 percent and 60 percent. This won't change. So why should we throw more good money after bad? Meanwhile, Wall Street is awakening to the disappointment that the securitized mortgages behind the toxic assets that have done so much damage to banks and the credit system are not being treated in the Obama program. The oversight is incredible. There are no safe-harbor provisions to protect mortgage servicers against lawsuits if agreements are broken. Ownership of these securitized mortgage pools is wide and far, spanning the globe. Breaking contracts is exceedingly difficult, especially without any legislated legal protection. Of course, banks that have whole loans can choose to modify them if they want. And in some cases it's much better to modify than foreclose. But 70 percent of this bank-owned paper is performing. It's the securitizations that have clogged up the world credit system. Then there's the bankruptcy-judge cram-down, which would allow the courts to renegotiate interest rates and loan principal. This would abrogate private contracts and throw out the rule of law. Do we think future investors will put up mortgage capital if they fear judges will overturn the terms of contracts? Home-loan supplies will fall and mortgage rates will rise. Then there's Fannie and Freddie, the big winners here. Only their products are eligible for mortgage relief. Jumbo mortgages are not. Neither are private-label mortgages created by various nonbank lenders. Fan and Fred already run 48 percent of the mortgage market. Mr. Obama's proposal would greatly enlarge that and move the mortgage system toward government nationalization. What's even more incredible is Team Obama's stubborn refusal to have any faith in the free market. In some of the hardest-hit areas of the country, markets are already solving the housing problem. Writing on his Carpe Diem blog, University of Michigan professor Mark Perry notes that while California home prices dropped 41 percent in 2008, home sales in the state jumped 85 percent. It now looks like 2008 sales for single-family houses will exceed levels reached in 2007. What's more, the unsold-inventory index for existing single-family detached homes in December 2008 was 5.6 months compared with 13.4 months for the year-ago period. And the median number of days it took to sell a single-family home dropped to 46.1 in December 2008 compared with 66.7 in December 2007. So inventories are dropping, the number of days to sell a home are falling, and sales are rising in the wake of lower prices. If the government really wants to help, instead of bailing out irresponsible mortgage holders, it should support new and younger families who want to buy starter homes and begin to climb the ladder of prosperity. All this is free-market economics 101. And I say, let free-markets work. Let's remember that most folks - even those with underwater mortgages, where the loan value is more than the home value - do not walk away from their obligations. They don't want to wreck their credit - and their homes are their castles. That's the American way. But if we penalize the good guys and subsidize the bad ones, we are undermining the moral and economic fabric of this country. Lawrence Kudlow is host of CNBC's "Kudlow & Company" and is a nationally syndicated columnist. washingtontimes.com

To: Sully- who wrote (69792)	2/23/2009 6:07:11 PM
From: Sully-	Respond to of 90947

In global warming we trust Anthony Sadar and Susan Cammarata The Washington Times Monday, February 23, 2009 COMMENTARY: Today, we are urged to believe that within the next few decades the globe will become intolerably warmer. The world as we know it will be drastically altered unless we act now to reverse our wayward lifestyles, especially our wasteful energy practices. But wait. Aren't we all just essentially being pressured to believe in a long-range climate forecast? And isn't this pressure largely being applied by politicians and political organizations no less? Who today would bet serious money on a weather prediction made a month in advance let alone decades ahead? Yet the developed nations of the world are under the gun to invest hundreds of billions of dollars on a climate prophecy when worldwide financial stability is tottering. Doesn't President Barack Obama have enough global headaches to buffer to worry about a trillion-dollar climate prescription? Many in the environmental profession have come to an epiphany like the one the late Michael Crichton had - that contemporary environmentalism, with its authoritative, unchallengeable proclamations and rigid tenets, is analogous to organized religion. This environmental religion is headed by politicians (or former politicians) as the high priests and an established political cathedral (read Intergovernmental Panel on Climate Change). These adored figureheads have selected verses from a collection of scientific data and climate effects to write their global-warming scriptures. Their holy writ includes a reworking of the Book of Revelation with planetary disasters as frightening as those alluded to in the authentic account. Salvation comes from giving the priests control over our daily lives to redeem us from our carbonaceous sins. Penance and indulgence take the form of "offsets" to carbon-spewing offenses like frivolous exotic vacations, meaty outdoor barbecues, incandescent-bulb burning, and driving a Hummer (a mortal sin!). Not to worry though, there is mercy in environmentalism. For the ability to continue trespasses like economic expansion in industrialized nations while enjoying a guilt-free contemporary lifestyle, the offsets are invoked to spare those in Third World countries from the modern burdens of ominous power plants, dirty cement kilns, egregious chemical factories, heartless pharmaceutical industries, sterile medical clinics, gluttonous harvests and gushing purified water. At least those with guilt-assuaged consciences can relax as they vicariously enjoy the back-to-nature lifestyles of loin-clothed aboriginals foraging for food to feed their gaunt families in a lush rain forest (while annually a million natives worldwide drop dead from malaria alone). How have we come to universally accept this new religion based on dubious prophecy that condemns so many poor souls to a living hell and will greatly limit the salvation offered by free economies? That's where the missionaries come in. These missionaries, a k a "teachers" and "professors," have gone out into the fields of the education system to disseminate the depressing gospel that the Earth is forever in big trouble. Thus, with sustained indoctrination from grade school through graduate school, proselytes have been harvested. No wonder today's scientists, let alone society, so quickly succumb to any doomed-Earth theory. Our scientific community has been primed to accept that a forecast of calamity for our atmosphere is as good as a reality. Everyone has been conditioned to believe that an extremely complex climate system is largely controlled by a single simple gas - carbon dioxide - even though the biggest single climate regulator on Earth is most likely water. The global atmospheric temperature is substantially controlled by water in all its forms, as invisible vapor in air, as liquid in oceans and clouds, and as solid ice crystals, snow cover, and glaciers. Besides, could other uncontrollable factors like variation in incoming solar radiation and cosmic rays, as some atmospheric scientists have proposed, have a dominant influence over climate? So, before we all surrender to a calamitous climate change scenario, let's put it into perspective with the very real present-day calamities of mass starvation, disease, ethnic cleansing, potential economic collapses, and the like. With these exceptionally serious challenges at hand and based on the enormous complexity of the Earth-climate system and the relative paucity of knowledge scientists have about the systems operation, we sincerely hope to encourage a return to humility in environmental research and activism and education about our biosphere. We hope politicians and scientists once again embrace the basics of science including the idea that all "theories" consist of assumptions and limitations - and this goes double for "forecasts"! However, we expect our motivational efforts at reformation will just end up getting us burned at the stake (in a carbon-neutral fashion of course) for environmental heresy. Anthony J. Sadar is a certified consulting meteorologist and co-author of "Environmental Risk Communication: Principles and Practices for Industry" (CRC Press/Lewis Publishers, 2000). Susan T. Cammarata is an independent environmental lawyer practicing in Pittsburgh. washingtontimes.com