German Finance Minister: Problems Centered in U.S.
"WSJ: Do we need coordinated international action to solve the financial crisis?
Steinbrück [German Finance Minister]: What we have now works, so far, including informal contacts between governments and central banks. We have succeeded in stabilizing crises where they happened, each country in its own way. Britain nationalized a bank. Others injected cash into Fortis. In Germany, we guaranteed a loan to a special-interest vehicle in order to provide Hypo Real Estate with liquidity. And the U.S. set up a big umbrella. There you see four different solutions."
RW: What an idiot! Global recession; Global policy coordination! I am just happy that the euro is tanking, and with it, the price of those Paul Green boots will have gone on extra sale (oops, they call it angebot there in Germany) by the time I get to Germany on Saturday!
People, Not Abstract Forces, Make History
“I guess it really does matter who the Treasury Secretary is. Here's what Hank Paulson's predecessor told Bloomberg about the bailout bill:
`’Doesn't this seem like lunacy to you?'' said O'Neill, who was President George W. Bush's first Treasury chief, from 2001 to 2002, in a telephone interview today. ``The consequences of it are unbelievably bad in terms of public intrusion into the private sector.'’”
Reader: Private Mortgage Insurance, I Want It Gone!
RW: Just so you know. Good bit about mortgage insurance.
“The Good News: Unless you have Lender Paid Mortgage Insurance (LPMI), which is included in your interest rate and there for the life of your loan, PMI can be removed after you have attained a certain amount of Equity in your home.
For the borrower to initiate the cancellation of their PMI, they must first contact their lender in writing when their loan to value reaches 80%. At this point the cancellation remains purely voluntary on the part of the lender — they may still deny your cancellation. Yet, when the loan to value of your home reaches 78%, your lender is required to remove the PMI from your monthly mortgage payment.”
Feldstein: Problems Run Deeper than Wall Street
Mark Thoma says, “With tax cuts and rebates, you create an incentive and hope people act on it in a way that stimulates GDP and employment. But there's nothing to guarantee that people will spend the money on goods and services and increase aggregate demand. Instead, they may pay off debts or save the money. With government spending, there is no such uncertainty since government purchases of goods and services impacts aggregate demand directly.”
RW: Well said, Mark. If one must spend, then do it already!
TS Elliot on the UK
“’Only those who will risk going too far can possibly find out how far one can go.’Preface to Transit of Venus: Poems The UK economy has gone as far it can go.”
What’s Not to Love about The $700 Billion Dollar Bailout Bill?
RW: Tons of humor (below), but you must click on the link to see the clever picture!
“This is serious and finally the real causes of the financial meltdown are being addressed.
The Bailout Bill deals with serious economic cripplers like solar panels. If they were more affordable it would fend off the specter of high fuel costs and restore consumer confidence. The legislation will allow tax deductions for the purchase of solar panels and lead to economic expansion.”
RW: And my political humor for the day. You all should know that I vote Republican, but I just couldn’t pass this one up.
Katie Couric's Supreme Court questions stump Sarah Palin
“CBS has just released the second to last segment of what seems like Katie Couric's 432-part interview with Republican vice presidential candidate Sarah Palin. It airs tonight on the "CBS Evening News."…..You can almost hear the awkward silence that follows.
COURIC: What other Supreme Court decisions do you disagree with?
PALIN: Well, let's see. There's -- of course -- in the great history of America rulings there have been rulings, that's never going to be absolute consensus by every American. And there are -- those issues, again, like Roe v. Wade where I believe are best held on a state level and addressed there. So you know -- going through the history of America, there would be others but --
COURIC: Can you think of any?
PALIN: Well, I could think of -- of any again, that could be best dealt with on a more local level. Maybe I would take issue with. But you know, as mayor, and then as governor and even as a vice president, if I'm so privileged to serve, wouldn't be in a position of changing those things but in supporting the law of the land as it reads today.”
RW: There is a replay of the interview on the webpage.
Homer Simpson Backs Obama
“In an excerpt from The Simpsons episode slated for Nov. 2, Homer Simpson casts his vote for president.”