Motley Fool Finds the Cullprit behind the crash NCAA bracket style

I've always been amazed at the ways people choose to figure out mysteries.

MotleyFool.com: Stock Madness 2009 has figured out one of the mysteries of our time, who caused the crash behind the current recession. The wise folks behind the Motley Fool gave their readers a chance to determine the answer NCAA Basketball style. Readers gave a solid answer and I think they are right.

There were lots of potential culprits behind the crash; but one act of congress stands out because of how badly it exposed the whole nation to the effects of corporate greed: the repeal of the Glass-Steagal Act. Nothing else compares in its effect on our nation.

My plan to end the recession

I've been reading some about the current recession being the product of greed and regulatory indifference. So now I am wondering what would happen if we started with the opposites? Sgt C (christopher-calbat.newsvine.com) put the formula for the crisis like this
unbacked assets + immediate equity on securities - oversight + deregulation x greed - ethics = FAILURE!!

So my proposal to get out of the mess is to do the opposite thing.
real assets - equities with real value + oversight + regulation * generostiy = a stable economy

Real assets. We already have assets starting to take on relatively stable value (if you can see the difference in housing prices in 2009 vs 2005 you can see that we have more stable values today than 4 years ago). We still need to pull in short sellers and others who are undermining the value of goods and services today.

- equities with real value. Its time to limit equity markets and funds to selling shares limited in scope to actual assets or sales (real property, machinery, patents, proprietary technology, cash etc.) Yes the fast buck era is over for most on Wall Street; but real growth might actually take place now that the profiteers are all asking for bail outs.

+ oversight (the FDIC is ramping up today like it hasn't in years)

+ regulation (lets not ever get back to this type of market again

all this multiplied by generosity and altruism

= a stable national economy

tell me what you think
Unlikely

Newsvine Article: Real Estate Still Moving in Olmsted County, MN

Real Estate Still Moving in Olmsted County, MN

Summary:
There's one bright spot in the toboggan slide knows as Minnesota Real Estate prices. It's Rochester and the rest of Olmsted County. As prices in the Twin Cities metro area continue to fall this one area just 90 miles southeast down US Highway 52 is surprisingly stable.

Visit the article by clicking this link:

http://unlikelybanter.newsvine.com/_news/2009/03/13/2545025-real-estate-still-moving-in-olmsted-county-mn

progress on 1 of the root causes of recession?

Watching Nightline I finally heard the news I've been wating for, President Obama is expecting an audit of the nation's banks. As part of "taking off the bandaid" on Wall Street. (http://abcnews.go.com/Business/Politics/story?id=6839534
Finally real progress 1 year after this recession started. We needed this last year; and now I think we're going to get it to happen.

An unsolicited email irked me

I received an unsolicited email that really bugged me today. It came to my church account signed by a raving Bush backer, Donald Wildmon. In it he called deficit spending proposed in HR1 immoral. I replied asking him when he'd spoken out against deficits in the past 8 years of the last administration.
He's published some of the letter at
capwiz.com/afanet/issues/alert/?alertid=12540961.
Its time to keep the discussion going but Mr Wildmon needs to call the old administrations deficits immoral if he's going to call HR 1 immoral.

Day 1 of 100 no wall street cleanup, yet.

President Obama has been in office for about 36 hours now. Some might say its too early to ask to see the meat of Obama's plans; but I'm wondering about the specifics of the wall street bailout will include.
Others are still thinking about the festivities thid week; but I'd like to hear some of the gritty details.

Lessons from FDR's first 100 days

A NY TIMES blog offers details of the first 100 days of Roosevelts administration right as we prepare for Obama's first 100 days. The overview provides real insight about what we might expect as a nation on the financial brink.

Check it out http://100days.blogs.nytimes.com/2009/01/16/how-fdr-made-the-presidency-matter/?th&emc=th

Still waiting for a bank/financial services holiday.

With less than 3 weeks until the beginning of the Obama administration I renew my request, as stated in my blog unlikelybanter.blogspot.com in March and October, for a national bank holiday. Our nation would benefit immediately from an even broader bank/financial services holiday than the one FDR imposed in March of 1933.

Students of US history know that Roosevelt's dramatic action, which started the FDIC (auditing the books and insuring deposits of banks) effectively saved the banking system. Consumer banking along with the economy as a whole was teetering on collapse at the end of Hoovers administration. FDR's dramatic action arguably saved the US economy and the capitalist system.

It should be noted that the circumstances are somewhat different in 2009. The real crisis is not so much in the banks as it is in all the other financial institutions that act some what like banks; but for sake of escaping regulatory oversight aren't considered banks. Its time, with the collapse of Madoff's fund and Petter's investment scheme, that all investment funds have their books opened to a more powerful SEC. Its time for to shutter the doors, just like FDR did with banks in 1933, until regulators are clear about the basis for each fund.

published simulatneously at newsvine.

Run on a Bank, does anybody remember 1933

This sign was up late one night last week so I took a picture early one morning when I was out running with the dog.

The news about Bear Stearns being bailed out by JP Morgan and the Federal Reserve is stunning. One of the nation's largest banks has effectively no assets at this time.

Some of this situation is reminiscent of runs on the banks that happened from 1929-1933. People are panicky and fear is rampant. The difference is that in the depression both the Federal Reserve and the Hoover Administration stood on the sidelines. The current Fed seems ready to engage; but monetary policy isn't enough. It's time to see what really going on in our nations financial services sector.

It's time for a bank holiday or rather, because of the complex nature of our deregulated financial services industry its time for a bank, credit-card, mortgage brokerage, mortgage backed securities, and investment bank holiday.

Most conventional banks wouldn't need to shut down at all. They were shut down and only allowed to open by FDR in 1933 after thorough audits. The regulations started in March 1933 led to the current FDIC set up in which we, as tax payers, insure our own banks against fiduciary negligence.

The hard part today is that many other less conventional but very key parts of the economy need to be audited and in some way insured. Bear Stearns, as a commercial bank, has no FDIC protection. In March 1933 the Congress acted in concert with the President. Can that happen in 2008 or will we have to wait until 2009.

understanding the recession and the election

My old roommate Habbs has a post about his dissatisfaction, as a conservative with the Republican Party. He's even got a manifesto as a conservative. It got me thinking. I'm not much for political parties but I am a fan of politicians with the will to govern and look out for the middle class and the underclasses in the process.

So now I'd like to lay out what I'm after in the next president and congress.

I'd say the best thing we could have right now is the return of FDR. But I'm a Christian, so I'm waiting for Jesus to come instead, so I'll settle for somebody who gets 2 things
1) that there's a bill of rights (including the first, second, and fifth amendments)
2) that we've got a pretty shaky economy because of greed...

• the finance industry benefited from the lax attitude towards consumer/borrower protection that was encouraged by Reagan, Bush 1 & 2 and Clinton, and the neo-conservative's acolytes in the leadership of the now defunct Republican Congress.
  
• oil/gas profiteers have decided now (during a war) is the time to squeeze consumers for every last drop of profit before consumers drop them in favor of other sources of energy.
• Many consumers added to this mess through their own greed borrowing until they had no means to pay back their creditors.

We have a growing recession based on broad consumer greed and the greed of profit taking by a very few in the energy and finance sectors of the economy during a time of war.

Neither party seems to get this complex situation because they are both being bought and sold every two years as they run candidates for election and re-election. What I care about is finding somebody to vote for who gets that we need real solutions to the recession.
the equation I see at work right now is

mortgage & credit-card debt
+
stagflation trigger by high oil & gas costs
=
a greed induced recession

I'm convinced that the solutions that work might be more radical than we've seen discussed thus far. If you are a dyed in the wool conservative it might be time to reread your US History books about the period between 1928 and 1940.

For a little background (in case you didn't take a class that included 20th century history) this current recession isn't our nations worst economic crisis. What Hoover did ignoring the depression from the crash of October 1929 until he left office in March of 1933 is the worst example of presidential economic negligence known.

In 1933 Roosevelt was called a socialist. But what he did saved the US for future capitalism. Bush's recession is mild in comparison to Hoover's, so far. Scary thing is some of the same underlying elements are creeping in

• steep drop in property values,
• displacement of workers,
• negative saving rate, and
• shrinking domestic industrial production.

FDR shut every bank in the country for fear that the whole economic system was about to crumble. He let none reopen until audited and subsequently insured by the FDIC. Most people alive today have never seen a run on a bank. Find a guy in his 90's to talk with and you might hear a story or two about Roosevelt's bank holiday.

Most conservatives don't like to talk about the New Deal; but ask any old timer who worked in the CCC about the dignity of having a job and he might tell you just how much the government can do, if well led, to benefit the most in this nation.

Yep I did Caucus Tuesday

Well I did it.
I caucused on Tuesday.
I'd expected my beloved to go along too, but it was just me and the short people who live with us. The choral group she sings with had rehearsal and she felt she needed to sing more that participate in the Democratic process. My initial plan had just been to cancel out her vote. But without her going I felt the freedom to pick the best candidate on the list.

I went to the Democratic caucus and I hemmed and hawed. There were several on the ballot who dropped out a month ago after Iowa and two more who dropped out in the last couple of weeks. Living so close to Iowa we've seen TV ads and heard radio commentary and ads about many who weren't a factor in this years election at all. Having read my fill about the candidates before Iowa I decided I wouldn't pick between the front runners. I picked Bill Richardson. I know he's suspended his campaign; but I liked him best over a month ago and I still liked him best of all the candidates on my caucus ballot this week.

My wife says it was a wasted vote. A good friend who talks politics with me ever couple weeks agreed with her adding, "he's a statesman, just like Lieberman and they never get elected." But hey I can vote in a caucus for the person I think has the will to govern.

On the Road home from Alexandria

This was first written in pen on paper in the back seat of Larry's car riding home this afternoon down I94.

3 people, a woman in her 80's, a man in his 50's, and me (in my 30's) headed together to a regional hunger retreat at a church camp up north this week. I was one of the younger, though not the very youngest participants who came along for the weekend. I came because of a hand addressed post-card I received from a retired pastor in Northfield. It wasn't to me personally but to the church and it was enough (that it was hand-written) to really get my attention.

Most of the presenters were professionals who raise funds, organize projects, and encourage people to speak up for the needs of the poor. These professional advocates come from what one of my car mates called an alphabet soup of church and para church groups who seek to serve those in need: Bread for the World, LWR, ELCA World Hunger, LCPCM, CWS, etc. They are all well known at church gatherings coming to visit each year and tell there stories and ask for support searching for ways to link the church, found always in the congregation, with the church found beyond our local congregations.

The bulk of the crowd was older and clearly politically informed and engaged in a variety of places on the left side of the spectrum. Many have been involved in hunger and poverty related issues for years. My 3 years working with a community food shelf is small compared to the years a few 80 something farmers have spent the last 30 years trying to figure out how to give from their abundance to the worlds very poorest. The professionals had pitches to make; but these guys had a common dream, that God could use there abundance to transform the world. The professionals and agencies can and do offer much globally, but the power of farmers learning to care for neighbors half the world away is to great to overlook.

There was (as can be expected at Lutheran gatherings) lots of coffee, bars, food, conversation, along with a multi hour bible study, devotions, communion, and presentations on a few new subjects as diverse as sustainable agriculture and work that LWR (Lutheran World Relief) is doing in areas hit by the tsunami in Indonesia a little over 3 years ago.

All of the presenters offered collectively (though maybe not intentionally) a different perspective on reality than what is presented in the conventional consumption/marketing driven media that shapes so many of our values and perceptions. Much of what was said, if not all, is what I've heard before from people convinced that hunger in our age is a result of human action or inaction not just natural circumstances. Statistics like, 1 in 6 people in the world live on less than $1 a day are real; they just don't make the cover of Time or Newsweek. Our culture is told more about starlets and their personal problems than the real problems of the hungry and poor. These issues are not new, and sadly neither is the audience who came. Most were repeating a journey they'd made before to talk about justice, poverty, hunger, and the best ways that Lutherans can respond in Jesus name to these situations.
On the way back we stopped at St. John's Abbey in Collegville, MN
.

Who to vote for Election 2008

I must confess that I'm a political animal who hasn't come out of his cage in quite some time. Maybe its the profession and I don't want to rock the boat by taking a stand for candidates when I really don't believe in any. Maybe its the lack of passion for political debate that seems too overdone while so many bigger things just sit unspoken. Maybe I'm just waiting for a candidate or even better a party that shares my values about the sanctity of life, freedom, personal and corporate responsibility, and above all the need to do the work of governing. I've been turned off by two...
I haven't always felt that way...
My sister and I were raised on political conventions and campaigning for our parent's favorite candidates. We hung out at the Dave Durenberger booth at the state fair every year for quite a stretch. My parents handed out literature for the senator. My dad even ran for state senate while I was in high school.
I've caucused and sub-caucused in a different party than my parents. In the fall of 98 I was at the victory party for the governor from a third party. It was a lot of fun back then, but times have changed.
I was raised in a political family; but my wife wasn't. Funny thing, the prospect of caucusing and naming her candidate out loud next month has her very excited, but I'm not that excited. My bride is leaning strongly one way and I told her that I would stand for the next most popular candidate in her party at the caucus. She won't have to go. I said that way we could just skip because my vote would cancel hers out. But she wants to go to stand up and I don't like her choice so now I'll go too. We plan to take our kids too. I told her I'd go and take one kid and stand up for one candidate while she takes the other and caucuses for another.

So here it is a couple weeks 'til super Tuesday, and now I've got to pick a candidate. I just want one with the will to govern.