Day: May 4, 2009

Random Thoughts

As usual I made tons of notes and not all made it into a post.

1–39% of the Amnerican people find the GOP favorable and 42% see Chavez in a favorable light.  Sucks being a Republican.

2–This was covered by just about every body, but I could not work a post out of it…..McCain, according to some talking show host, should not be allowed to speak on torture because he had been tortured and he would be biased.  Just how dumb is that statement?

3–Egypt sslaughterd 300, 000 pigs because of swine flu–think about that for a minute….they are Muslims and do not eat pork, what were the pigs for?

4–Miss California now joins a anti-gay marriage group as a spokesperson.  This broad is an opportunistic “C” word.  And it was reported that the girl had a boob job just before the pageant….thinking….if you a re gonna get fake tits at least make them more noticeable, especially if you are gonna parade your butt in front of older guys drooling at the sight of tender young things.

5–Pork Assn has gotten there way–the name swine is being phased out in favor of H1N1 virus.  It seems that sales were sliding with the name “swine” attached to the sickness.  Now that is power!

2009 Anal-Ocity

Holy crap!  The GOP needs to muzzle this idiot, she is giving all Republicans a bad name.  They really did not need the help, but she takes stupid to a whole new level.

On Earth Day, she said on the floor of the House of Representatives:

Carbon dioxide, Mister Speaker, is a natural byproduct of nature. Carbon dioxide is natural. It occurs in Earth. It is a part of the regular lifecycle of Earth. In fact, life on planet Earth can’t even exist without carbon dioxide. So necessary is it to human life, to animal life, to plant life, to the oceans, to the vegetation that’s on the Earth, to the, to the fowl that — that flies in the air, we need to have carbon dioxide as part of the fundamental lifecycle of Earth.

Think about what she has said……(time for reflection)……she must have missed the report that states:

Sixty percent of Americans live in areas with unhealthy air pollution levels, despite a growing green movement and more stringent laws aimed at improving air quality, the American Lung Association said in a report released Wednesday.

The public-health group ranked the pollution levels of U.S. cities and counties based on air quality measurements that state and local agencies reported to the U.S. Environmental Protection Agency between 2005 and 2007.

Overall, the report found that air pollution at times reaches unhealthy levels in almost every major city and that 186.1 million people live in those areas. The number is much higher than last year’s figure of about 125 million people because recent changes to the federal ozone standard mean more counties recognize unhealthy levels of pollution.

Health effects from air pollution include changes in lung function, coughing, heart attacks, lung cancer and premature death.

I guess that ignorance goes along with the earth being only 5000 years old too.

If I were a Repub, which thank God I am not, I would be embarrassed by the words of this moronic broad.  But as I always say, Repubs will not let facts get in their way.

She keeps spouting and lying…there is now a website where you can track her outlandish statements:

http://www.dccc.org/page/content/bachmannwatch

Credit Card Crisis–Part 1

Banks have gotten more money than God has and still the credit that was promised to loosen up, is still ceased up with little hope of relaxation anytime soon.

A crisis in credit card debt is likely to be one of the next major shocks to the US banking system. Many large institutions, such as Bank of America and Citigroup, already effectively insolvent but for billions of dollars of bailout money from the federal government, will now see their financial positions deteriorate even further.

Personal debt, primarily in the form of home equity loans and credit cards, has been one of the principal mechanisms whereby working class families have attempted to counteract the decline in real income since the 1970s. Indeed, much of the consumer spending that has buoyed the US economy over the last few decades was facilitated by credit cards and other forms of personal debt. At the same time, the provision of “credit” has become one of the most substantial sources of income for banks in the face of an increasingly frenzied drive to raise profitability. However, this situation is now undergoing rapid change.

As banks have suffered major losses in mortgages and other “toxic assets,” they have continued to make money on credit card debt by increasing interest rates and fees and through a range of deceptive practices that are being imposed on card holders abruptly and with little or no justification. The growing anger over these practices, which affect working class and also more well off middle class people, has been receiving increasing attention in the media; so much so that bills have been introduced in both the House and Senate to address the issue.

One such bill is the Credit Cardholder’s Bill of Rights:

Ends Unfair, Arbitrary Interest Rate Increases
•    Prevents card companies from unfairly increasing interest rates on existing card balances – retroactive increases are permitted only if a cardholder is more than 30 days late, if a promotional rate expires, if the rate adjusts as part of a variable rate, or if the cardholder fails to comply with a workout agreement.
•    Requires card companies to give 45 days notice of all interest rate increases or significant contract changes (e.g. fees).

Lets Consumers Set Hard Credit Limits, Stops Excessive “Over-the-Limit” Fees
•    Requires companies to let consumers set their own fixed credit limit that cannot be exceeded.
•    Prevents companies from charging “over-the-limit” fees when a cardholder has set a limit, or when a preauthorized credit “hold” pushes a consumer over their limit.
•    Limits (to 3) the number of over-the-limit fees companies can charge for the same transaction – some issuers now charge virtually unlimited fees for a single violation.

Ends Unfair Penalties for Cardholders Who Pay on Time
•    Ends unfair “double cycle” billing – card companies couldn’t charge interest on debt consumers have already paid on time.
•    If a cardholder pays on time and in full, the bill prevents card companies from piling additional fees on balances consisting solely of left-over interest.
•    Prohibits card companies from charging a fee when customers pay their bill.

Requires Fair Allocation of Consumer Payments
•    Many companies credit payments to a cardholder’s lowest interest rate balances first, making it impossible for the consumer to pay off high-rate debt.  The bill bans this practice, requiring payments made in excess of the minimum to be allocated proportionally or to the balance with the highest interest rate.

Protects Cardholders from Due Date Gimmicks
•    Requires card companies to mail billing statements 21 calendar days before the due date (up from the current 14 days), and to credit as “on time” payments made before 5 p.m. local time on the due date.
•    Extends due date to next business day for mailed payments when the due date falls on a day a card company does not accept or receive mail (i.e. Sundays and holidays).
Prevents Companies from Using Misleading Terms and Damaging Consumers’ Credit Ratings
•    Establishes standard definitions of terms like “fixed rate” and “prime rate” so companies can’t mislead or deceive consumers in marketing and advertising.
•    Gives consumers who are pre-approved for a card the right to reject that card prior to activation without negatively affecting their credit scores.
Protects Vulnerable Consumers from High-Fee Subprime Credit Cards
•    Prohibits issuers of subprime cards (where total yearly fixed fees exceed 25 percent of the credit limit) from charging those fees to the card itself. These cards are generally targeted to low-income consumers with weak credit histories.

Bars Issuing Credit Cards to Vulnerable Minors
•    Prohibits card companies from knowingly issuing cards to individuals under 18 who are not emancipated.
Requires Better Data Collection from Credit Card Industry
•    Requires reports to Congress by the Federal Reserve on credit card industry practices to enhance congressional oversight.
Swift Implementation of 45-Day Notice Requirement
•    Requires card companies to send out 45-day notice of interest rate increases 90-days after the bill is signed into law; the remainder of the bill takes effect 12 months after enactment.

But will this be enough to protect the credit consumer from the predatory practices of the credit companies?

OMG! Mark To Market Is Destroying America

May I see a show of hands of the people that have heard the term “mark to market” and have no idea what it means? (a moment for thought)

What is mark to market pricing?

Loans and securities make up the bulk of a bank’s assets. Thus, the method you use to establish values for these securities when preparing your financial statements affects shareholders’ equity. (Shareholders’ equity = assets – liabilities, remember?) That, in turn, has an effect on a bank’s profit and loss statement.

Mark-to-market accounting sets the value of (or “marks”) the assets on your balance sheet to reflect their market sale prices. In theory, that all sounds nice and clean. In practice, things get a little messier.

When the housing bubble burst, the market for all those mortgage-backed securities vanished, leaving bank balance sheets larded with assets that no one wanted. So at the end of each quarter, banks had to write down billions of dollars of “toxic assets”—even though their value might’ve been artificially, and only temporarily, depressed. But if banks never intended to sell an asset in the current market, they reasoned, why should they be forced to value it as if they did?

Banks are currently required to calculate their earnings, under so-called “mark to market” accounting rules, according to the current market value of the securities they hold, but the new measure would allow them to value assets using their own internal models where the assets would otherwise be sold into a “distressed” market. Banks have argued that markets are not pricing financial assets fairly, causing credit to dry up and exacerbating the crisis.

The Financial Accounting Standards Board (FASB) voted to let US banks set their own prices for assets in earnings reports, regardless of current prices.

The move, which was heavily lobbied for by Wall Street, is expected to increase bank earnings by 20 percent in the next quarter. Richard Dietrich, an accounting professor at Ohio State University, told Bloomberg News that the decision would allow Citigroup to reduce its reported losses by 50 to 70 percent.

This is what the bankers and Wall Street have wanted.

The announcement sparked a rally on the stock market, led by financial companies. Citigroup stock rose 8.6 percent, Bank of America soared 9.6 percent and Wells Fargo rose 10.5 percent. The rally subsided later in the day, but financial stocks retained significant gains and the Dow Jones Industrial Average closed with a gain of more than 216 points.

According to the proponents of the measure, the crisis is to be resolved by “fairly” valuing the securities held by banks, allowing the financial system to return to normality. By allowing the banks to claim their assets as fundamentally sound, they argue, the panic will subside, banks will start lending, and the economy will gradually recover.

Now, the banks are to be allowed to use the same obscure and discredited financial models to inflate their balance sheets, based on the claim that markets have ceased to “fairly” reflect the real value of their illiquid assets. This is little more than an excuse to line the pockets of CEOs, hedge fund managers and big investors.

Anytime we see the banks post a profit it is not anything but an accounting trick to make it appear that all is well. They are creating profits out of thin air.