- Government Watchdogs: Mortgage Program is not Working
- Did BP Keep Drilling Even Though It Had Lost Control of the Oil Well Much Earlier?
- What Would Mises Do?
Posted: 22 Jul 2010 09:33 AM PDT
If I could label this as “obvious”, I would.
From Yahoo News
WASHINGTON (AP) — Government watchdogs told a Senate panel Wednesday that the Obama administration’s effort to help homeowners avoid foreclosure isn’t working and that the Treasury Department has failed to fix the program.
Special inspector general for the financial bailouts Neil Barofsky said the program has not “put an appreciable dent in foreclosure filings,” during a Senate Finance Committee hearing on the $700 billion bank bailout. He also said the Treasury Department has ignored earlier demands that it set clearer goals for the program.
Elizabeth Warren, who chairs a separate Congressional Oversight Panel on the bailouts, said Treasury’s failure to act more quickly could be hurting the recovery.
More foreclosures could force down the price of homes and further hurt the already-ailing housing industry.
The homeownership program aims to reduce mortgage payments for millions of homeowners who can’t afford their monthly bills. Recent data suggest it has helped about 400,000 households avoid foreclosure. About 530,000 have fallen out of the program.
The bailout has provided up to $50 billion for the mortgage modification programs. So far, about $248 million in bailout money has been spent on the program.
Barofsky said Treasury is giving mortgage companies too much leeway to decide which homeowners will qualify for a program to reduce the principal balance of their mortgages.
The program relies on voluntary cooperation from mortgage companies, Warren said. She said many of the mortgage debt collectors make more money when they foreclose than they do when helping homeowners.
“We have a crisis, and the consequences of not having cooperation from (mortgage) servicers is . . . felt by this entire economy,” Warren said. “We need a program with far more urgency and some real teeth in it.”
Also appearing at the hearing is a leader of the Government Accountability Office.
Their three offices are designated to provide transparency and oversight for the bailout program that Congress passed in October 2008.
Most of the financial bailout programs have ended as the financial system regained its footing. Treasury lent out a total of $385 billion from the $700 billion fund. As of June 30, about $198 billion had been repaid, according to the independent Government Accountability Office.
Treasury also has collected $25 billion in fees and interest payments from companies that received money.
President Barack Obama was preparing Wednesday to sign into law the most sweeping rewrite of financial regulations since the 1930s. The law includes changes aimed at reassuring Republicans, who worry the bailout fund could become permanent.
The size of the fund is reduced to $475 billion from $700 billion. Money that has been repaid must be used to repay the national debt, rather than expanding other programs. And the overhaul blocks Treasury from using the money to create new programs.
Posted: 22 Jul 2010 08:28 AM PDT
From Washington’s Blog
The New York Times noted yesterday:
As I pointed out last month:
Damaged Blowout Preventer
Whether or not BP had lost control of the well earlier, it was confirmed yesterday that BP had damaged its key piece of safety equipment – the blowout preventer – earlier, yet kept drilling.
The Los Angeles Times reported Monday:
The New York Times adds the following details:
And as I pointed out in May:
Posted: 22 Jul 2010 08:03 AM PDT
“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final total catastrophe of the currency involved.” ~ Ludwig von Mises
I believe we are facing a future collapse of our debt and dollar as Mises outlines in the above quote. We should forgo the macho, “Apocalypse Now smelling napalm in the morning rhetoric” and ask ourselves, “what did Mises do in a similar situation?”
In 1934, Mises left Austria for Switzerland rightly fearing a Nazi Anschluss or annexation with Germany which most of the population eventually supported in 1938. Later in 1940, he left Switzerland for the US fearing a successful German invasion of Switzerland. What could a little Jewish man have done fighting the German Wehrmacht or the Waffen-SS? Absolutely nothing!
“Not mythical material forces but reason and ideas determine the course of human affairs. What is needed to stop the trend towards socialism and despotism is common sense and moral courage.” ~ Ludwig von Mises
Mises chose a smarter course of action which we should follow today to win the battle for freedom and liberty over those who would enslave our children in poverty for generations after they have finished looting our liberties and wealth today. His solution did not involve violence or material forces but rather reason, education and ideas. The ideas of Mises and the Austrian School of Economics might not even exist today were it not for Mises escaping to America with his philosophy and dedication. He fought smart with common sense and courage and this is what we all need to do today.
My Personal Recommendations:
Educational Options – Support the few think tanks and foundations in the U.S. and abroad that don’t compromise and actively seek to restore real political and personal freedom. Question foundations predominately funded by large corporations or contributions from mainstream organizations as over time, many 501(c)3 foundations tend to move away from their stated goals as money pressure mounts and the mission is compromised by the reality of budgetary necessities.
Make your contributions over a long period of time because some organizations, boards and presidents change as does the philosophy and direction. You can retain some impact on future programs by making your contributions on a regular but long-term basis. Also be sure to remember your favored foundations in your will and trusts.
At the present time my preferred organization for tax-deductible contributions is the Mises Institute but a warning is in order. There will likely come a time when 501(c)3 organizations offering tax deductible contributions may become so controlled by Washington that they will be rendered ineffective in the fight for personal liberty. My last freedom contribution was to LewRockwell.com but without a deduction because they have more freedom to engage in educational and political actions and use my contributions where it is best needed.
Secure Wealth Options – Many readers have asked about my personal strategies and recommendations during these perilous financial times. My overriding concern is to prepare a defense for our wealth and remaining liberties before a run on the dollar and Washington revenue needs tramples everything that hasn’t been carefully shielded. It is important to secure your wealth not so much for yourself but for future American generations. We must use our excess wealth to fund educational, philosophical and political efforts to restore the original patriot dream of America’s founding fathers.
Get most of your wealth outside the dollar and the United States while of course following all reporting requirements and tax requirements. When possible and if your level of net worth permits also take your business, vocation, family and yourself. Then live relatively frugally rather than wasting your wealth on high living and excess consumption. Be able to use your wealth to restore what was once the greatest nation and jurisdiction of freedom and liberty in the entire world with the following actions:
1. Decrease Your Exposure To U.S. Markets & Political Risk – Continue to diversify your stock and bond portfolio outside the U.S., moving to offshore investments and quality mining share opportunities.
2. Sidestep a Future Liquidity Trap – Increase your holdings of non-dollar denominated assets in bank accounts, money market and mutual funds, insurance products and gold storage. Use reputable, long-established foreign custodians and financial firms to avoid the liquidity trap of American markets being closed by a financial crisis.
3. Buy More Gold & Silver – Add to your gold and silver holdings. If they’re substantial, store most of the metal in secure programs outside the U.S. This will protect you from the growing risk of gold confiscation. Consider Global Gold in Switzerland and/or The Perth Mint in Australia.
4. Increase Your Participation in Mining Shares – Move more money into mining shares during any short-term pullbacks in the price of gold.
5. Consider A Safe-Haven Retreat & Vacation Property Outside the U.S. – Choose a location you’ve visited before and where you would like to live full or part-time. But even if it’s only for investment purposes, don’t buy real estate in a country you’re not yet very familiar with.
6. Reduce Your American Real Estate Holdings – The tax benefits of home ownership will soon vanish for most Americans because the government is going to be desperate for revenue.
7. Get A Second Passport – If possible, get a second passport for use when traveling or living overseas. When the dollar and U.S. Treasury debt bubble collapses, the world will blame Washington and Wall Street for plunging it into the Greatest Depression. The last thing you will want to show when visiting or living offshore is an American passport.
8. Move Outside the USA – If practical, move your business, job and person offshore and outside of the U.S. One way or another, you’ll pay taxes wherever you go. Why not pay them to a government that gives you stability in return, instead of to a government that repays you with incompetence and tyranny.
9. Dodge the Coming Obama Retirement Trap – If you have a substantial amount in an IRA or other tax-advantaged retirement plan and are approaching retirement, start taking distributions now. For balances over $200,000, consider shutting down the plan. A cash-strapped Washington could eventually force your IRA to put everything into Treasury bonds or even impose a special tax on “excess” benefits.
10. Take Social Security As Soon as You are Eligible – Collect what you can, while you can, before you get shut out by a “means test” and lose your promised benefits.I urge each of you to battle the enemies of freedom with courage and intelligence using your wealth and the internet to promote our vision for a restored America. Follow the peaceful but wise path chosen by Ludwig von Mises and we will achieve victory in our lifetime.