Archive for October 1st, 2008

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WSJ: Bill Educates Barack

October 1, 2008

From today’s WSJ:

A running cliché of the political left and the press corps these days is that our current financial problems all flow from Congress’s 1999 decision to repeal the Glass-Steagall Act of 1933 that separated commercial and investment banking. Barack Obama has been selling this line every day. Bill Clinton signed that “deregulation” bill into law, and he knows better.

In BusinessWeek.com, Maria Bartiromo reports that she asked the former President last week whether he regretted signing that legislation. Mr. Clinton’s reply: “No, because it wasn’t a complete deregulation at all. We still have heavy regulations and insurance on bank deposits, requirements on banks for capital and for disclosure. I thought at the time that it might lead to more stable investments and a reduced pressure on Wall Street to produce quarterly profits that were always bigger than the previous quarter.

“But I have really thought about this a lot. I don’t see that signing that bill had anything to do with the current crisis. Indeed, one of the things that has helped stabilize the current situation as much as it has is the purchase of Merrill Lynch by Bank of America, which was much smoother than it would have been if I hadn’t signed that bill.”

One of the writers of that legislation was then-Senator Phil Gramm, who is now advising John McCain, and who Mr. Obama described last week as “the architect in the United States Senate of the deregulatory steps that helped cause this mess.” Ms. Bartiromo asked Mr. Clinton if he felt Mr. Gramm had sold him “a bill of goods”?

Mr. Clinton: “Not on this bill I don’t think he did. You know, Phil Gramm and I disagreed on a lot of things, but he can’t possibly be wrong about everything. On the Glass-Steagall thing, like I said, if you could demonstrate to me that it was a mistake, I’d be glad to look at the evidence.

“But I can’t blame [the Republicans]. This wasn’t something they forced me into. I really believed that given the level of oversight of banks and their ability to have more patient capital, if you made it possible for [commercial banks] to go into the investment banking business as Continental European investment banks could always do, that it might give us a more stable source of long-term investment.”

We agree that Mr. Clinton isn’t wrong about everything. The Gramm-Leach-Bliley Act passed the Senate on a 90-8 vote, including 38 Democrats and such notable Obama supporters as Chuck Schumer, John Kerry, Chris Dodd, John Edwards, Dick Durbin, Tom Daschle — oh, and Joe Biden. Mr. Schumer was especially fulsome in his endorsement.

As for the sins of “deregulation” more broadly, this is a political fairy tale. The least regulated of our financial institutions — hedge funds — have posed the least systemic risks in the current panic. The big investment banks that got into the most trouble could have made the same mortgage investments before 1999 as they did afterwards. One of their problems was that Lehman Brothers and Bear Stearns weren’t diversified enough. They prospered for years through direct lending and high leverage via the likes of asset-backed securities without accepting commercial deposits. But when the panic hit, this meant they lacked an adequate capital cushion to absorb losses.

Meanwhile, commercial banks that had heavier capital requirements were struggling to compete with the Wall Street giants throughout the 1990s. Some of the deposit-taking banks that were allowed to diversify after 1999, such as J.P. Morgan and Bank of America, are now in a stronger position to withstand the current turmoil. They have been able to help stabilize the financial system through acquisitions of Bear Stearns, Washington Mutual, Merrill Lynch and Countrywide Financial.

Mr. Obama’s “deregulation” trope may be good politics, but it’s bad history and is dangerous if he really believes it. The U.S. is going to need a stable, innovative financial system after this panic ends, and we won’t get that if Mr. Obama and his media chorus think the answer is to return to Depression-era rules amid global financial competition. Perhaps the Senator should ask the former President for a briefing.

Liberal friends of mine point to “deregulation” and the GLB as th reason for our financial crisis.  The article makes a great point about the lack of regulation in hedge funds and the success they have had.

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“Week” – Great New McCain Ad

October 1, 2008

Courtesy of HotAir. I like these ads, but I fear that J-Mac may come off as a used car salesman or look like he is doing an infomercial. Senator McCain, I do need a Shamwow!

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Happy 84th Birthday to the Worst President of Our Time!!!!!

October 1, 2008
Worst President Ever!!!

Worst President Ever!!!

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Rehearing Denied in Kennedy v. Louisiana (Death Penalty and Child Rape)

October 1, 2008

There was a call from both left and right to have this case reheard. The call was based on Justic Kennedy’s assertoin that a majority of Americans are against putting child rapists to death.  That turnedo out to be blatantly false. Alito and Thomas voted for rehearing. Scalia has a great opinion:

I am voting against the petition for rehearing because the views of the American people on the death penalty for child rape were, to tell the truth, irrelevant to the majority’s decision in this case.The majority opinion, after an unpersuasive attempt to show that a consensus against the penalty existed, in the end came down to this: “[T]he Constitution contemplates that in the end our own judgment will be brought to bear on the question of the acceptability of the death penalty under the Eighth Amendment.” Ante, at ___ (slip op., at 24). Of course the Constitution contemplates no such thing; the proposed Eighth Amendment would have been laughed to scorn if it had read “no criminal penalty shall be imposed which the Supreme Court deems unacceptable.” But that is what the majority opinion said, and there is no reason to believe that absence of a national consensus would provoke second thoughts.

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Worst Ad Ever!

October 1, 2008

From hotair

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Gallup: The One Leads by 4

October 1, 2008

Closing the gap Obama 48 – McCain 44

Found this on Ace

Found this on Ace

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Homeless in Ohio Help Obama Get His Thug Thizzle On.

October 1, 2008

Michelle Malkin posted this depressing stuff: Go to her site to watch a ridiculously funny video

The guy promoting the free taxi program to register the homeless in Ohio exults: “It’s a perfect opportunity for them to come in, register at a temporary address like a homeless shelter or a YMCA or something like that. They can register at that address because they don’t know where they’re going to be tomorrow or next week.”

Another woman describes trolling bus stops and picking up prospects: “I asked ‘em if they’re registered to vote and if they weren’t, I said ‘Get in the car, I’m bringing you!’”

A homeless thug now registered to vote comments: “They picked me up. They seen me walkin’ around. So day said, ‘You wanna vote?’ I said, ‘Yeah, I’ll vote.’ (laughs) Day said, ‘We’ll take you anywhere you want.’ I said, ‘Dat’s cool’…If day say ’sign the ballot,’ just give ‘em and do exactly what they want you to do.’ I mean, hey, dis is America, you know?” (laughs).

Who does this new voter support?

“Barack! I mean, I want him to do his thang. You know, do his thug thizzle. You know. That’s how I like it to be. You know. (laughs).”

I knew that my treatment of the homeless over the past decade and a half would come back to bite me.