The truth about Obama's economy---Top Bank Analyst Predicts 13% Unemployment (interest, cost, jobs)

[bale002]

Many threads lately have been blatantly tinged by partisan politics, as opposed to analysis of policy-making, let's cut it out.

The merit of Ms Whitney's comments is that she points out the futility of focusing on housing and lending as the alleged primary causes of the economic downturn (they are symptoms) and that policymakers are not focusing on restructuring the productive part of the economy that would create real jobs.

She is just a dime-a-dozen analyst, the problem is that the same incestuous class of people have colonized both the banking industry and government, among other things, and they seek solutions that they perceive, in their magnificent insight, are least painful and most gainful to themselves, naturally.

[floridasandy]

i think that an important element of the story is being overlooked, the safe harbor provision mentioned.Safe Harbor: Unnecessary, Unfair, Unconstitutional | Reuters.
it is hard not to draw politics in it when you have the politicians promising one thing and actually doing another thing.

"Unfortunately, the bill would not only pay institutions handsomely for each modification they do -- at $1,000 each, a bounty that could reach $10 billion-- but it would also create opportunities for mortgage servicers to profit at the expense of investors who own the loans."

"For example, if the servicer of an abusive loan was also the initial lender, the bill would take that company off the hook for any future predatory lending suits. The safe harbor, therefore, could encourage servicers to modify their most poisonous loans, even if they are not yet near default, just to reduce their legal exposures."

[floridasandy]

Originally Posted by floridasandy

i think that an important element of the story is being overlooked, the safe harbor provision mentioned.Safe Harbor: Unnecessary, Unfair, Unconstitutional | Reuters.
it is hard not to draw politics in it when you have the politicians promising one thing and actually doing another thing.

"Unfortunately, the bill would not only pay institutions handsomely for each modification they do -- at $1,000 each, a bounty that could reach $10 billion-- but it would also create opportunities for mortgage servicers to profit at the expense of investors who own the loans."

"For example, if the servicer of an abusive loan was also the initial lender, the bill would take that company off the hook for any future predatory lending suits. The safe harbor, therefore, could encourage servicers to modify their most poisonous loans, even if they are not yet near default, just to reduce their legal exposures."

more legislation to protect the banks and hurt the public sector.

[oz in SC]

Originally Posted by floridasandy

more legislation to protect the banks and hurt the public sector.

Well....yes.

The banks and other big corporations are more important than the people.

[texdav]

Ifr all hi9s cahnegs happen to get voted through I thnik we may see a permanent high employemnt especally below 30 just like europe has had for decades.

[Austin13]

Originally Posted by floridasandy

more legislation to protect the banks and hurt the public sector.

It would also be helpful if states did more to monitor "efficiency" by state employees in their state agencies.........in order to help the public sector.

[ndfmnlf]

Originally Posted by Traderx

With 13% unemployment this is a great time to start a business.

Good point. Wages will be low, many unemployed people to choose from. Great time to start a business.

[nicet4]

Originally Posted by texdav

Thyen if inflation really kiciks in in about two years ;epople willreally see hurt like in teh 70's recession.

How can it NOT kick in?

Come on people, we manufacture trillions out of thin air and expect the dollar to maintain value?

[nightbird47]

I was watching the PBS news review last night. From what was said, those designing the "recovery" are worried. Everyone is in the process of revising their predictions and expectations and the governments will be the last to be released. The reason that all the big bills in congress are being pushed to be passed quickly is that they know when these NEW reports come out and are revised minus green shoots, that the cost of the bills will doom them.

Everyone I know who is employed is saving and spending very cautiously lest the lose their job. If people don't have the money to spend or don't trust that they won't need it later, your not going to see a free flow of money at the shopping centers. They may be buying a new car now with dealers begging you to buy and the trade in, but when thats done they *have* the good car and will drive it til it dies if they have to. Aritfically indiced sales do not mean that down the road they won't dissapear as fast as the happened.

[floridasandy]

Originally Posted by Austin13

It would also be helpful if states did more to monitor "efficiency" by state employees in their state agencies.........in order to help the public sector.

absolutely! there was an interesting article called something like "don't worry about goldman, worry about the government" and i think it make some excellent points:
Forget Goldman, Start Worrying About the Government -- Seeking Alpha
in part:
When Goldman repaid its TARP funds, paving the way for them to then hand out record bonuses, who do you think allowed this? Government.

When Goldman sold asset-backed securities to investors when it was net short the mortgage-backed market, whose rules do you think allowed this? Government.

Forget about Goldman Sachs. Start worrying about government.

They are the ones who regulate the financial services industry. Government is the one which makes laws governing how financial services companies can and cannot operate. Government is also the one which can change the ground rules going forward to help prevent a recurrence of this sort of financial crisis in future.

As my good friend Marshall Auerback says, the advantages firms like Goldman have are “symptomatic of the problem, but they are not the problem.” The problem is Government and its cozy relationship with the industry it is suppose to regulate and control. The government is captured by the financial services industry, plain and simple.

the article actually follows up with what people can do about this and makes some very good points.