Expect the Best, but prepare for the Worst

Are banks buying politicians in an effort to keep an unfair privilege?
(See contributions to Jeb Bush and Hillary Clinton)  Too many voters have their heads like ostriches in the sand.

money in 2016Seeing their darling on the left (Hillary) hit the skids and their favorite on the right (Jeb Bush) in sad decline, the reaction of the banking industry reminds me of a cat I once had.
She was placid, until one morning some dogs backed her into a corner. Then she lost it.

You only have to watch some of the Club for Growth negative ads to wonder if they have lost it.  Don’t they realize they are on the wrong side of history. 2016 is the year when the negative ads finally stop working. This 2016 electorate wants positive, STRONG solutions.

Now this cat, she bit and clawed and screeched and pounced and even although we saved her, she was never the same again.  She was irascible, unpredictable and mean. Possibly this had been her basic personality all along.

So the big question is, are the banking elites frightened that their unfair privilege is about to come to an end? Is this becoming a vital factor in Election 2016? Are the statists and now the conservative elites (crony capitalists)  frightened because they can’t buy Trump?  

There is a situation here that the next President will have to face, and it is going to take a very strong man (Trump or Cruz) to bring us through.

Hello! It is finally time to face the facts of this economy. 

No, it is not all doom and gloom, it is a situation that can still be fixed but only if we choose wisely in the next election. 

In a nutshell here is the situation:  In spite of a bottomless pit of FED money creation, the debt is unsustainable; the “created” income inequality is finally being seen and understood by voters and they are resenting the injustice.. Stop gap measures to settle out the protest  like food stamps are only making matters worse.  Past efforts by the banksters to pin the blame elsewhere are no longer working. On Twitter and Facebook we learn that with the crash of 2008, only the immediate danger was handled but ethics and correction and reorganization NEVER WENT IN. All the money printed by the FED to bail out the banks, and to “stimulate the economy” didn’t go to the people; it went right back to the banks. The biggest danger: derivatives  could be the next bubble to pop and make life mighty hard on main street.

inijustrice

We are going to have to wake up and realize that we need a STRONG and good president!. Please read the following:

” As my fellow Heritage colleague Norbert Michel and other scholars have thoroughly documented, the crash of 2008 was caused by government policies and regulatory failure, including easy money policies that flooded the markets with debt. Within a decade, these policies led to preposterous mortgage loans being issued, and massive over-leverage of government, companies, and households.

Now the Fed, the White House, and Congress are recreating the very same conditions for another financial bubble. If it pops, we could replay the same devastating effects as occurred during the first bubble in 1999 and 2000.

It is doing so in four ways:
First, the Dodd-Frank regulations are exacerbating one of the greatest consolidations of the banking industry since the Great Depression. Those indispensable small banks, like the one Jimmy Stewart operated in the movie “It’s a Wonderful Life,” are disappearing from the American landscape.

This is largely because big government policies are slanting the system in favor of big banks. Because of this, we have created a competitive advantage that allows the sharks to swallow the minnows. Meanwhile, the “too big to fail” safety net to Bank of America, Citi, and other titans exacerbates this cost advantage of big banks and thus makes bailouts even more likely in the future.

Second, Fannie Mae and Freddie Mac are engaged in the same low down payment lending mania of 2004-07, and the Obama administration is on a Bush-like homeownership push. Fannie and Freddie are again guaranteeing mortgages with as little as 3 percent down payment. Have we learned nothing at all?

Third, the Fed refused to tighten its stance in September, and, hello, that easy money policy is how we got into the mess in 2000 and then in 2008. Wall Street cheered Janet Yellen’s decision to keep the cheap dollars flowing.

sliding banks

Finally, there is the saturation of debt. When the crisis hit in 2008, the national debt stood at a little under $10 trillion. Now we are over $18 trillion. Government is hopelessly over-leveraged, and the interest rate exposure is enormous. With each one-percentage-point rise in long-term rates, the servicing costs of the debt rises by about $1.8 trillion over ten years.

Fannie and Freddie are again guaranteeing mortgages with as little as 3 percent down payment. Have we learned nothing at all?

The point is that government and politicians have no learning curve. All of the conditions of financial wreckage are reappearing. The presidential candidates should start warning voters that Washington is rebuilding another financial house of cards”

As Published in the Daily Bell – A Heritage Foundation Publication.

COMMENTARY BY

Portrait of Stephen Moore

Stephen Moore, who formerly wrote on the economy and public policy for The Wall Street Journal, is a distinguished visiting fellow for the Project for Economic Growth at The Heritage Foundation.

 Quote for the week

In choosing a president, we really don’t choose a Republican or Democrat, a conservative or liberal. We choose a leader.

Rudy Giuliani