M - Cubed

Chicago Boyz » Blog Archive » Drucker on Education, 1969

2011-11-24T09:28:00.000-08:00

Chicago Boyz » Blog Archive » Drucker on Education, 1969

Jesus and Ancient Jewish Background by Dr David Instone-Brewer

2011-10-31T12:01:00.000-07:00

- a Visual Sermon by Dr David Instone-Brewer:

'via Blog this'

Historical Reliability of the Bible

2011-09-24T14:36:00.000-07:00

- a Visual Sermon by Dr David Instone-Brewer

Trends in College Spending 1999-2009

2011-09-23T20:30:00.000-07:00

Trends2011_Final_090711.pdf (application/pdf Object)

2,000-Year-Old Biblical Burial Box Reveals Clue About Death Of Jesus | FoxNews.com

2011-08-31T19:32:00.000-07:00

2,000-Year-Old Biblical Burial Box Reveals Clue About Death Of Jesus | FoxNews.com

More texts on Talmadic References to Yeshu

2011-07-27T07:29:00.000-07:00

From Bethinking.org:

For more information see

“Jesus of Nazareth’s Trial in Sanhedrin 43a” (Jerusalem Perspective, 2011) by Dr David Instone-Brewer
- a detailed discussion of the dating of the different layers in this tradition. (Pre-publication version)

Jesus in the Talmud (Princeton, N.J: Princeton University Pess, 2007) by Peter Schäfer
- an up-to-date discussion of the historicity of all the censored passages

Christianity in Talmud and Midrash (London: Williams & Norgate, 1903; New York, KTAV, 1975) by R. Travers Herford
- a list and analysis of all the censored passages

David Instone-Brewer on Talmudic References to Yeshu, San 43a

2011-07-26T23:53:00.000-07:00

David Instone-Brewer « Undeception

Gleaned from a unfamiliar blog, David Instone-Brewer on a Talmudic reference to Jesus and the charges brought against Him. An earlier post of mine on a "Yeshu" in the Talmud.

"It’s interesting to note that in the Gospels there are verses indicating that Pharisaical scribes were recording Jesus.

http://www.studylight.org/desk/?l=en&query=scribes&section=2&translation=nas&oq=scribes&new=1&sr=1

In Matthew 12:22 Jesus heals a blind, deaf and possessed man. In turn the Pharisees accused Jesus of practicing sorcery in the name of Beelzebub the prince of demons in verse 24. So the Gospels seem to confirm the Talmudic view of Yeshu, who to me seems to be Jesus of Nazareth"

Added July 27, 2011: Instone-Brewer's pre-publication.

"Summary:
The Munich Talmud manuscript of at b.San.43a preserves passages censored out of printed editions, including the controversial trial of “Yeshu Notzeri”. Chronological analysis of the layers in this tradition suggests that the oldest words are: “On the eve of Passover they hung Jesus of Nazareth for sorcery and leading Israel astray”. This paper argues that other words were added to this tradition in order to overcome three difficulties: a trial date during a festival; the unbiblical method of execution; and the charge of "sorcery" which implies that Jesus’ miracles were genuine because illusions were not punishable by death."

Instone-Brewer responds in this discussion thread

Review & Outlook: Where the Tax Money Is - WSJ.com

2011-06-02T20:48:00.000-07:00

Review & Outlook: Where the Tax Money Is - WSJ.com

Resurrecting the mystery of the Shroud of Turin - NYPOST.com

2011-04-28T12:26:00.000-07:00

Resurrecting the mystery of the Shroud of Turin - NYPOST.com

YouTube - Meet the Liberal Elite!

2010-12-06T07:17:00.000-08:00

YouTube - Meet the Liberal Elite!

Will America’s universities go the way of its car companies?

2010-09-04T10:40:00.000-07:00

http://www.economist.com/node/16941775

Octoraro Railway: OCTR #3

2010-07-13T21:29:00.000-07:00

I worked on this railroad rebuilding track during college. We used 19th century techniques.

Octoraro Railway: OCTR #134

2010-07-13T21:19:00.000-07:00

70 will be the new retirement age

2010-07-11T08:47:00.000-07:00

http://seattletimes.nwsource.com/html/nationworld/2012327603_socialsecurity11.html

You New College Graduate: A Parents’ Guide: newyorker.com

2010-05-20T08:15:00.000-07:00

You New College Graduate: A Parents’ Guide: newyorker.com

The Disadvantages of an Elite Education

2010-05-17T07:28:00.001-07:00

The Disadvantages of an Elite Education

Posted using ShareThis

Instone-Brewer on Abortion

2009-11-09T21:13:00.000-08:00

David I-B's sermon on abortion is linked here. Christians are sometimes vexed by the lack of any mention regarding abortion in the NT. David I-B discusses this point by discussing 1st century moral values among the Jews and the Greco-Romans:

"Originally, in rural Greek & Roman society they did “expose” infants
- and some people still did so in the 1st century, but it was difficult in towns
- it was easier to quietly smother the baby at birth and throw out the corpse
- some people did still leave babies on a hillside, leaving them to the ‘gods’
- but in practice this left them to the dogs, and to brothel keepers who sometimes rescued infants as an investment for their business. "

"Jews thought that this Roman custom was barbaric, and they said so
- Philo pulls no punches when he described what actually happened in practice:
“Some of them do the deed with their own hands; with monstrous cruelty and barbarity they stifle and throttle the first breath which the infants draw or throw them into a river or into depths of the sea, after attaching some heavy substance to make them sink more quickly under its weight. Others take them to be exposed in some desert place, hoping, they themselves say, that they may be saved, but leaving them in actual truth to suffer the most distressing fate. For all the beasts that feed on human flesh visit the spot and feast unhindered on the infants; a fine banquet.”(Spec.3.114-5)
- Josephus contrasted Jewish & Roman cultures in Conta Apionem, incl: [2.202]
“The [Mosaic] Law… forbids women to cause abortion of what is begotten, or to kill it afterward; and if any woman appears to have done so, she will be a murderer of her child, by killing a living creature and diminishing human kind.”

I-B finds a clue in Acts 15 instructions to new Gentile Christians:

¹⁹ "Therefore it is my ^R897 judgment that we do not trouble those who are turning to God from among the Gentiles, ²⁰ but that we write to them that they abstain from things ^R898 ^F362 contaminated by idols and from fornication ^R899 and from what ^R900 is strangled and from blood.

The bolded item seems curious and out of place. Some translations for pnictos use "strangled meat." So is it another form of dietary restriction?

I-B cues in:

The fourth word, pnictos is very rare but is usually translated “strangle”
- why? because it sounds similar to pnigos and that means “strangle”
- actually, this isn’t too far off, because I later concluded it means “smother”
- but what does it mean in this context? How does it make any sense?

.....

All the other examples of pnictos were used with regard to food
- in particular a certain type of meat called “smothered meat”. What’s that?

.....

but what would the original readers think?
- well, I think they would be confused at first
- it is rather like saying: the four worst sins you can commit are idolatry, fornication, murder and eating Pate de Foie Gras!

Studylight has a translation of pnictos:

suffocate, strangled
what is strangled, i.e. an animal deprived of life without the shedding of blood
of cooking: our "smothered" as a culinary term

David I-B sums it up here (bold added):

What would they explain? They tell them why “smothering” is so bad
- not the smothering of new-born baby animals, ready for eating
- but the smothering of new-born babies, or killing them any other way

Why did they use this strange rare word for “smothering”
- I think the euphemism “exposed” didn’t contain any negative value
- that’s just the normal thing you do, as a sensible father and good citizen
- instead they wanted to use a word which took away the pretence
- like anti-abortionists talk about murdering babies instead of aborting fetuses
- it may not be the most accurate language, but it conveys the moral truth
- no-one, after hearing these four words explained, would forget the message

The Apostolic Decree told new Gentile believers about a new morality
- they weren’t allowed to sacrifice to idols or eat in pagan temple dining rooms
- they weren’t allowed to have sex with slaves, or prostitutes, male or female
- they weren’t allowed to kill slaves or eat blood (probably both messages)
- and they weren’t allowed to kill babies as a means of birth control

His publication appears in Journal of the Evangelical Theological Society. 52, 2009, 301-321

Also note that the Didache, the 1st century instructions to new Christians prohibits abortions.

Raced-based university admissions

2009-11-03T11:32:00.000-08:00

There are interesting comments at this InsideHigherEd.com article.

The Test Score Advantage
Among the potential bombshells in the book are data on the advantages or disadvantages of SAT or ACT scores by race, ethnicity and economic class. Many studies -- including those released annually by the College Board and the ACT -- show gaps in the average tests scores by members of different racial or ethnic groups. This research takes that further, however, by controlling for numerous factors, including gender, status as an athlete or alumni child, high school grades and test scores, type of high school attended and so forth.
The "advantage" referred to, to take an example from the book, is what it would take to have equivalent odds of admission, after controlling for other factors. So the table's figure of a 3.8 black ACT "advantage" means that a black student with an ACT score of 27 would have the same chances of admission at the institutions in the study as a white student with a score of 30.8.
As the following table shows, there are large black advantages in the way colleges consider SAT and ACT scores, and notable disadvantages for Asian applicants. On issues of wealth, the SAT shows an expected affirmative action tilt, with the most disadvantaged students gaining and the wealthiest losing. But there is also a gain for upper middle class students. On the ACT, analysis found the advantages go to wealthier students.
The table uses ACT scores for public institutions and SAT scores for privates. The "norm" score was considered white for the race section, and middle class for the class section.
Advantages by Race and Class on the SAT and ACT at Selective Colleges, Fall 1997

Group Public Institutions (on ACT scale of 36) Private Institutions (on SAT scale of 1,600)
Race
--White -- --
--Black +3.8 +310
--Hispanic +0.3 +130
--Asian -3.4 -140
Class
--Lower -0.1 +130
--Working +0.0 +70
--Middle -- --
--Upper-Middle +0.3 +50
--Upper +0.4 -30

Same Ol' New Jersey

2009-11-01T06:30:00.000-08:00

One of the reasons New Jersey will stay New Jersey no matter who's governor, from the WSJ:

Property Taxes Could Sink Chris Christie in New Jersey

By PAUL MULSHINE

New Jersey Republican Chris Christie, who hopes to unseat Democratic Gov. Jon Corzine in next Tuesday's election, is a former U.S. attorney who locked up more than 130 public officials on corruption charges. But what New Jersey needs is a governor willing to confront the state's Supreme Court over who is in charge of school funding. And Mr. Christie has shown no stomach for that fight.

New Jersey's constitution gives the state legislature the power to distribute proceeds of the state's income tax to aid local education and partially relieve the burden of property taxes. But in a succession of school-funding cases over the years, the state Supreme Court has taken control of the $11 billion Property Tax Relief Fund.

The result is a perennial property-tax crisis. The court sends more than half of the state aid to 31 largely urban "special needs" school districts, the special needs of which were for the most part created by decades of Democratic mismanagement. The remaining 554 largely suburban towns fight over the rest...[more]

Why Do Republicans Know More?

2009-10-29T14:28:00.000-07:00

From Wall Street Journal's Best of the Web 10/29/09

Why Do Republicans Know More?
The Weekly Standard's Mary Katherine Ham, a distant cousin of Francis Bacon, has an intriguing blog post on a recent survey from the Pew Research Center for the People and the Press. Pew asked a series of questions about current events, and found that Republicans were considerably more likely than Democrats to know the correct answers. Democrats outscored Republicans on only one question, whether health spending is higher in the U.S. or Europe, and the two parties tied when asked what policy area the term "public option" refers to. On 10 other questions, ranging from who Glenn Beck is to the name of the newest Supreme Court justice, Republicans were more likely to answer correctly.

Ham faults the media for not paying much attention to this finding, and we reckon they haven't. The survey is two weeks old, and this is the first we've heard about it. But it got us to thinking about the reasons for the discrepancy.

It reminded us of an item we did in 2003, after Arnold Schwarzenegger's election as California governor. Looking at exit-poll data, we noted that Republicans seemed to do better among more educated voters: high school dropouts are more Democratic than high-school graduates, who in turn are more Democratic than college graduates. The exception is that those who have done postgraduate study have voting patterns similar to dropouts. We suspect this is because this group includes unionized teachers.

Another possibility is that the higher knowledge level among Republicans is an artifact of public disillusionment with the GOP. For the past several years, fewer Americans have described themselves in polls as Republicans, a trend that has not yet reversed despite the unpopularity of President Obama's policies. If Republicans are in bad odor, then less-engaged citizens would be less likely to declare themselves Republicans.

WSJ: Fiat Models to Drive Chrysler

2009-10-26T21:48:00.000-07:00

Over at the WSJ a slide-show of Chrysler's fate. The Fiats look like props from a Federico Fellini movie. So what happens when you merge a crappy American car company with an Italian one? Wasn't there a reason Fiat left the American market back in the 1970's?

The best comment from the WSJ:

"We would have been better off liquidating Chrysler and at then flying a fleet of B-52's to Italy in order to drop a few hundred billion USD out of their holds. That would have been cheaper and more effective."

The MBA is taking America down

2009-04-06T09:09:00.000-07:00

Bloggers are weighing in on the worthlessness of the MBA. Here's one. I think it's one of the components of the trinity of disaster that academia has imposed on America. The other two are diversity and Colleges of Education.

Student Loan Debt -- Good or Bad?

2009-04-02T17:15:00.000-07:00

Two recent articles in the WSJ and at a CNN blog illustrate the role of debt in modern life. In the WSJ article "With this Debt I Wed Thee" the author makes a good distinction:

Good debt: a mortgage on an affordable house; a loan on an affordable car; student loans to pay for a college degree. In effect, good debt improves your life permanently.

Bad debt: auto leases, since they generally finance cars you otherwise can't afford; home-equity loans or lines of credit, which too often fund discretionary purchases; any consumer expenses for which you allow the balance to roll over from month to month. In effect, bad debt only improves your lifestyle temporarily.

The CNN blogger is a recent grad saddled with student loan debt, over $100,000 studying an unspecified major that supposedly allowed her to obtain her position. She does mention that she knew her career prospects would yield low pay. It's clear that she and commentators on her blog are asking for a bailout. To what extent should society accommodate this behavior? The adage that student loan debt is a good one is in fact a fallacy. It's simple to weigh the costs -- does the degree allow for the income to pay off such debt? If not, then it's a no go. This stuff about a college degree creating well-rounded citizens is overrated. If you were take two groups of people send one off to college, the other to work or the military, you'd find the latter more mature and able to assume the responsibility of citizenry. College loan debt can be bad debt, as many use these loans for precisely for temporary improvement of lifestyle, i.e. postponement of adult responsibilities and hedonism with the pretensions of scholarly pursuits.

Is California Going Bust?

2009-03-29T07:56:00.000-07:00

Looks like the reverse of the 1930's dust bowl where people fled the heartland for California.

From Forbes magazine:

Is California Going Bust?
Matt Woolsey 04.13.09, 12:00 AM ET
There has been many a time in California's history when it seemed to outsiders to be barreling toward a cliff and to insiders as a place for unbounded optimism. A favorite Silicon Valley bumper sticker says, "Dear God, one more bubble before I die."
That optimism is being sorely tested. Statewide unemployment, at 10.1%, is well above the national average of 8%. Per capita income growth, which used to be above average, is now lagging. In the last year home prices fell 35% in San Francisco, 30% in San Jose and 27% in San Diego, according to Radar Logic, a New York real estate derivatives firm. Half of the home sales in Los Angeles are from banks dumping foreclosed properties at steep discounts.

Have you noticed more Ponzi schemes in the news?

2009-03-15T07:49:00.000-07:00

The king of the recent Ponzi schemes is of course Bernard Madoff ($50 billion). But I've noticed that many more mini-Madoffs are appearing in the news. Here are a few: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11. Out of these R. Allen Stanford ($8 billion) comes closest to Madoff. Have there been more than usual coming out of this latest bubble, or have these types always been there preying on the naive and/or greedy? Madoff's victims could hardly be called naive, but were they greedy or lazy?

And what about the mother of all Pozni schemes? This CNN piece doesn't think it's a Ponzi scheme. It's wrong

Snopes on what Democrats were saying about Iraqi WMD's

2009-01-23T10:29:00.000-08:00

I got into a discussion with a Steve Sailor reader at one of the blog comment forums. Basically he was offering 20/20 hindsight, arm chair quarterbacking insights on W's Iraq invasion. Ignoring WMD's the invasion was morally justifiable based solely the numbers of Iraqi civilians were killing during the 1991-2003 sanctions period. Wikipedia has a good article on this. With W's invasion the sanctions are gone and the killing for the most part has stopped. The blog commenter went on to say that we should have just lifted the sanctions altogether ignoring Saddam Hussein's behavior. How possible was that? Check out the comments made by prominent Democrats, pre-invasion at Snopes.

Samuelson on socialized medicine and the coming Medicare/Social Security Crisis

2009-01-21T09:05:00.000-08:00

Robert Samuelson has two columns that do a good job of the insanity of Obama's and the voter's choices.

Obama's Unhealthy Choices:

"What really drives health spending, the study finds, is that Americans
receive more costly medical services than other peoples do, and pay more for
them. On a population-adjusted basis, the number of CT scans in 2005 was 72
percent higher in the United States than in Germany; U.S. reimbursement rates
were four times higher. Knee replacements were 90 percent more frequent than in
the average wealthy country and are growing rapidly. In 2005, there were 750,000 knee and hip replacements, up 70 percent in five years, reports the journal Health Affairs."

In an October 22, 2008 WaPo column he has this:

Young Voters Get Mad

"You're being played for chumps. Barack Obama and John McCain want your votes, but they're ignoring your interests. You face a heavily mortgaged future. You'll pay Social Security and Medicare for aging baby boomers. The needed federal tax increase might total 50 percent over the next 25 years. Pension and health costs for state and local workers have doubtlessly been underestimated. There's the expense of decaying infrastructure -- roads, bridges, water pipes. All this will squeeze other crucial government services: education, defense, police. "

"Obama's your favorite candidate (by 64 percent to 33 percent among 18- to
29-year-olds, according to the latest Post-ABC News poll)."

"Click on the Obama video. You'll see some world-class pandering. There are
three basic ways of reducing the costs of Social Security and Medicare: increase
eligibility ages; trim benefits; and require recipients to pay more for their
Medicare benefits (higher premiums, co-payments or deductibles). In his talk,
Obama effectively rejected all three. "

Why would young voters go against their own interests? Perhaps it's form of generational altruism, knowing in the end they'll take the lumps (huge). I think the answer is simpler than that - they're woefully ignorant of finances and purpose of state-hood. They believe they're voting for security (theirs) when actually they're voting for the financial equivalent of a perpetual motion machine. We'll see in the future that the purpose of state-hood is to provide for an orderly society and not guaranteed financial security.

Delinquent Mortgages Set to Nearly Double in 2009

2008-12-02T08:36:00.000-08:00

From WSJ:

The number of consumers with delinquent mortgages is poised to almost double by the end of next year, hitting its highest level in at least 16 years, according to a leading credit bureau. TransUnion LLC, which analyzed about 27 million consumer records in its database, predicted that the proportion of consumers with mortgages that are 60 days or more past-due will hit 7.17% in the fourth quarter of 2009.
That would be the highest level reached since the Chicago credit bureau -- which is releasing the data on Tuesday -- first started tracking ...

Stuff Environmentalists Like, Part 1

2008-12-02T07:17:00.000-08:00

Over at Plenty Magazine.

...If an environmentalist invites you over for dinner, do not assume that your host’s primary purpose is to serve you a meal. The goal is education...
...If conversation starts to lull, it’s always a good idea to bring up a paradox that engages the entire table. The most pressing question of our generation is: local or organic?...
...Next week: Brainwashing Children

Income Redistribution

2008-11-28T15:43:00.000-08:00

From IBD.com:

Now here's the reality: The rich are being taxed at ever-higher levels,
while more workers at the bottom of the income ladder are paying no taxes at
all. As for spending, resources flowing to those at the bottom far outstrip
those flowing to those at the top.

Worse, a 'what's in it for me?' attitude seems increasingly the norm. Once a
nation of stoic, self-reliant individualists, America now seems full of people
who think other taxpayers owe them something. They see the 'system' as a giant
cow to be milked — and damn the cow. This is backed up by polling data. In a 1994 Pew poll, 57% agreed with the statement 'Government should care for those
who can't care for themselves.' Today, it's 69%.

New Obama Appointee Rubin on Personal Responsibility

2008-11-27T09:07:00.000-08:00

This ought to be an interesting 4-8 years. Let's hope it's 4. Robert Rubin on the Citibank mess:

Then there's board member and former Treasury Secretary Robert Rubin, who has received over $100 million in compensation from Citi in 10-plus years, according to the New York Post."I don't feel responsible, in light of the facts as I knew them in my role," Rubin told the New York Times back in April. "In hindsight, there are a lot of things we'd do differently. But in the context of the facts as I knew them and my role, I'm inclined to think probably not."

More from the Seattle Times.

Although Rubin has been cagey about his role at Citigroup, what is
indisputable is that all of the decisions that have led to the recent troubles
were taken while he was chairman of the executive committee and were made by
executives whom he supported and with whom he worked closely day to
day.

‘Teaching Unprepared Students’

2008-11-25T08:13:00.000-08:00

Over at Insidehighered.com:

Many experts say that the United States can only truly see gains in the
percentages of adults who have a college degree if colleges and universities get
better at teaching students who arrived on campus unprepared for college-level
work. But many professors find themselves frustrated by teaching such students — and many of the students drop out....

The comments:

I never had a problem reaching and teaching underprepared students who
wanted to learn. However, the students who are both underprepared and who lack
any semblance of a work ethic are another matter. When these students have been
taught for twelve years that they will advance to the next grade regardless of
how little they have learned or how little effort they have invested, they are
incapable of performing at a college level. That is because many of them have
never even achieved a junior high school level of self-discipline. Such students
are doomed to fail not only in school, but in life. They are tomorrow’s blue-
and white-collar criminals.

The subject of the interview states “However, the reality is that right now
we have freshmen and transfer students who are not prepared, but who are
enrolled in our classes and want to learn.”
I challenge that logic. Too many
students are enrolled because they have been sold a bill of goods. They are not
their to learn. Rather, they are there to get a job. They have been told this by
high school teachers, family members, public policy makers, admission officers,
etc. All of them have said the key to getting a good job, making lots of money,
and having a great life is, all together now, a college degree.
These
students fail to take to ownership of their education. They will blame the
instructor for having grading standards, for demanding their work meet certain
criteria, and for inconveniencing their lives. These people do not care about
knowledge.

I work in a Catholic, college prep high school that sends over 95% of our
students to college. We are facing the same issues of unprepared and unmotivated
students as discussed in the article & comments. Every year it seems, we
(and all of our peer institutions in NH) admit very intelligent (high test
score) students, some who have a pathetic work-ethic; who want education to be
entertainment; and who lack basic academic skills. We have implemented a
“front-loaded” program for freshmen that involves a core of battle hardened
teachers along with various support services. Most kids catch on and eventually
become successful. But every year, there are more and more kids who arrive
without an adequate foundation. It’s scary to think about the students coming
up, what they’re going to need, and how many resources they will require. I wish
I could be optimistic but I see all of us caught in the cultural demise of what
learning and education is all about.

I would tend to agree with those regarding lack of work ethic. I see it
everyday. Some students have a sense of entitlement regarding their academic
performance, while others realize that their performance is a reflection of
their hard work and effort. For many students, there is a disconnect between
effort and performance. After many years of schooling this disconnect means
these students are at the bottom of a very large hill. They will need an
extraordinary amount of assistance to make any progress up the hill (forget
about getting to the top). My question is: Is this the job of the university
faculty?

“Everything must be learner-centered.” I have seen first-hand, at the
secondary and post-secondary level, the debilitating effects this mantra has had
on the learning environment. Life beyond the Ivory Tower is not, and the sooner
we teach our self-absorbed students this fact, the better learners (and people)
they will become. The kumbaya feel-good vibe is something I save for students
who give a damn; I’ve been burned far too many times by diverting positive
emotional capital towards students who end up dropping or failing anyway.

Financial Hits - Hitler in a Bunker

2008-11-23T22:18:00.000-08:00

Hitler in a bunker is a bit overused as a schtick but here we go, pretty funny:

Found at Mangan's

30 reasons for Great Depression 2 by 2011

2008-11-19T08:18:00.000-08:00

Paul Farrell over at Martketwatch lists his 30 reasons why we'll be in a depression by 2011. He Cites greed several times, that's obvious but what about envy? It seems to me that envy drove the subprime mess. The feeling of wanting that house despite the lack of fiscal discipline and the politicians that fed that envy drove all of this. I've blogged before on the lack of fiscal discipline among groups of people (link 1, 2). It seems to me that we can't face up to the fact that we have equal oppurtunity but that doesn't give equal outcomes. And what if everyone couldn't be a homeowner? Renting, is that inhumane?

On that list of 30 items, here's the largest:

25. The 800-pound gorillas: Social Security, Medicare with $60 trillion in unfunded liabilities

We just voted in the political party least likely to fix this mess.

The American Voter

2008-11-18T07:06:00.000-08:00

Over at Verum Serum:

Zogby Poll from http://www.howobamagotelected.com/
57.4% could NOT correctly say which party controls congress (50/50 shot just by guessing)81.8% could NOT correctly say Joe Biden quit a previous campaign because of plagiarism (25% chance by guessing)

82.6% could NOT correctly say that Barack Obama won his first election by getting opponents kicked off the ballot (25% chance by guessing)

88.4% could NOT correctly say that Obama said his policies would likely bankrupt the coal industry and make energy rates skyrocket (25% chance by guessing)

56.1% could NOT correctly say Obama started his political career at the home of two former members of the Weather Underground (25% chance by guessing).

And yet…..
Only 13.7% failed to identify Sarah Palin as the person on which their party spent $150,000 in clothes

Only 6.2% failed to identify Palin as the one with a pregnant teenage daughter

And 86.9 % thought that Palin said that she could see Russia from her “house,” even though that was Tina Fey who said that!!

Only 2.4% got at least 11 correct.

Underwater Equity Hotspots

2008-11-12T17:02:00.000-08:00

From Zillow's blog.

The End of Wall Street's Boom?

2008-11-11T21:33:00.000-08:00

Over at Portfolio.com. Found at Steve Sailer's Blog:

...Long Beach Financial was moving money out the door as fast as it could, few questions asked, in loans built to self-destruct. It specialized in asking homeowners with bad credit and no proof of income to put no money down and defer interest payments for as long as possible. In Bakersfield, California, a Mexican strawberry picker with an income of $14,000 and no English was lent every penny he needed to buy a house for $720,000....

...Moses actually flew down to Miami and wandered around neighborhoods built with subprime loans to see how bad things were. “He’d call me and say, ‘Oh my God, this is a calamity here,’ ” recalls Eisman. All that was required for the BBB bonds to go to zero was for the default rate on the underlying loans to reach 14 percent. Eisman thought that, in certain sections of the country, it would go far, far higher....

...But he couldn’t figure out exactly how the rating agencies justified turning BBB loans into AAA-rated bonds. “I didn’t understand how they were turning all this garbage into gold,” he says. He brought some of the bond people from Goldman Sachs, Lehman Brothers, and UBS over for a visit. “We always asked the same question,” says Eisman. “Where are the rating agencies in all of this? And I’d always get the same reaction. It was a smirk.” He called Standard & Poor’s and asked what would happen to default rates if real estate prices fell. The man at S&P couldn’t say; its model for home prices had no ability to accept a negative number. “They were just assuming home prices would keep going up,” Eisman says...

...“With all due respect, sir,” Daniel told the C.E.O. deferentially as they left the meeting, “you’re delusional.” This wasn’t Fitch or even S&P. This was Moody’s, the aristocrats of the rating business, 20 percent owned by Warren Buffett. And the company’s C.E.O. was being told he was either a fool or a crook by one Vincent Daniel, from Queens....

Uncle Sam's Credit Line Running Out?

2008-11-11T13:53:00.000-08:00

Over at Baron's.

Big Five

2008-11-11T09:27:00.000-08:00

I'm a O95-C69-E53-A69-N27 Big Five!!

http://www.outofservice.com/bigfive/

Derbyshire on his Obama-ness

2008-11-10T11:02:00.000-08:00

Over at the NRO Corner Blog.

The sputtering-Left component of my email bag took particular exception to my calling Obama "shallow, ignorant, and self-obsessed." How dare I? Well, let's unpack it.

Shallow: Have you ever heard Obama say anything interesting? Me neither. I saw him on the telly the other day fielding a question about illegal immigrants. He said something like: "We can't deport ten million people. We need to find a way to bring them out of the shadows. Thet should have to pay a fine, learn English, and go to the back of the line for citizenship." Now, here is an issue that's of major concern to millions of Americans, who feel they are losing the nation they grew up in. It's been argued for years at high levels of discourse, with many fine books written. (Most recently, one by our own Mark Krikorian.) Yet Obama can address it only with the tiredest, most threadbare clichés of the open-borders Left. It's plain he has never given a moment's real thought to the issue. Shallow.

Ignorant: Obama strikes me as a very intelligent person, but with that intelligence narrowly focused. He has spent his adult life among the tiny sub-class of black Americans who have grown wealthy, or hope to, via the affirmative-action rackets. He has never ventured outside that milieu, and I seriously doubt he knows much about life outside it. I doubt, for example, that he knows anything much at all about business, the military, science, work (other than paper-shuffling), or high culture. I'll be glad to be proved wrong, but nothing I've heard him say, nor my (admittedly incomplete) acquaintance with what he's written, refutes that.

Self-obsessed: A guy who publishes a 464-page autobiography at age 34 is self-obsessed, what can I tell ya? If he publishes a second autobiography at age 45, you can print "self-obsessed" in capital letters. (Yeah, I know, it's a "campaign book." The content is mainly autobiographical, though.)

WSJ on the Death of Michael Crichton

2008-11-08T06:30:00.000-08:00

His viewpoints will be missed. He was respected by most, and his well-founded but contrarian views were at least considered by those holding conventional wisdom.

"Crichton was sometimes accused of being a Luddite. In fact, he was a champion of good science, and never more so than in a 2003 lecture at Caltech, hilariously titled "Aliens Cause Global Warming."

"As the 20th century drew to a close," he warned, "the connection between hard scientific fact and public policy became increasingly elastic. In part this was possible because of the complacency of the scientific profession; in part because of the lack of good science education among the public; in part because of the rise of specialized advocacy groups which have been enormously effective in getting publicity and shaping policy; and in great part because of the decline of the media as an independent assessor of fact."

2004 Generosity Index and the Red States Gone Blue

2008-11-06T10:25:00.000-08:00

In my search for charity data in the last post I came across this piece of data from the non-partisan Catalogue For Philanthropy at Michelle Malkin's Blog:Notice that the '04 Red States that went Blue in 2008 (i.e. Iowa, Ohio, Virginia, Arizona, New Mexico, Nevada, & Colorado) were the lowest givers for the Reds in 2004. Only and North Carolina and Florida stand out as exceptions.

Note added 1:40 pm: It often gets Blue State people upset that it appears that Red Staters give more. They always focus on the church and the tithe. How does that excuse Blue Staters from giving to non-church entities?

The Didache on Abortion and Charity - Possible Modern Implications

2008-11-06T06:51:00.000-08:00

I blogged on the Didache last year. It is an instruction manual for new Christians (primarily conversions of gentiles) and may be the earliest writings of the Apostles, dating as early as 49 AD. It's too bad that it's not better known by Christians. It has implications for the modern Christian. Specifically, on abortion and the modern welfare state.

First on abortion:

Didache 2:2 - You shall not murder a child by abortion or commit infanticide.

Pretty clear isn't it? Why is abortion not discussed in the gospels? My guess is that Jesus preached primarily to the 1st century Jews where such practice was not widespread. The Greco-Romans practiced abortion and exposure. Jews believed in the primacy of the fetus in that era. The Jewish historian, Philo of Alexandria discusses Ex. 21:22-23 in context of the LXX. From Philo on Jewish Identity and Culture:

“The LXX transformed these Biblical verses into laws protecting the fetus.”

Now on the modern welfare state where everyone receives (bold emphasis added):

Didache 1.5c - Woe to the one who receives. For if he receives because he has need, he is guiltless, but if he does not have need, he shall stand trial as to why he received and for what, and being put in prison he will be examined about what he has done, and he will not come out of it until he pays the last penny.

Many would disagree, but I believe that so much of the profligate ways of the modern welfare state goes to those not in need. The senior prescription drug plan is just one such example.

Also note that Didache strongly advises Christians to be charitable and defend the poor but adds this:

1.6 But of this it was also said, 'Let your charitable gift sweat in your hands until you know to whom you give'.

Christians must be discerning to who is in need. However, the modern welfare state completely abrogates this aspect of giving. It’s interesting to note the amount of charitable giving between the prosperous blue (and secular) states versus the red states.

Much of the Didache is what I would assume to be a common sense approach to ethics, not just Christian ethics.

Peter Schiff on Obama

2008-11-05T10:01:00.000-08:00

The University of IdahoSchiff was one of the few hedge fund managers to predict this crisis a few years back. He doesn’t like Obama. Found at Housing Doom blog.

Paul Johnson on Modern Western Society

2008-11-04T17:25:00.000-08:00

My favorite historian Paul Johnson chimes in on Forbes:

"in a nutshell: We are traveling along the high road to incompetence and poverty, led by a farcical coalition of fashionably liberal academics on the make, assorted eco-crackpots and media wiseacres. "

The rest is here.

Policy Predictions for After an Obama Victory

2008-11-04T07:17:00.000-08:00

Over at Rasmussen' blog, a comprehensive list. Sounds like a to do list for the left.

Immigration, Affirmative Action, Bucking The Bailout - All Potential Election Winners For McCain

2008-11-04T06:53:00.000-08:00

A Steve Sailer column on what the Republicans should have done. Well - we'll have to sit back and take it. We're moving towards a nanny state. The home mortgage defaulters, the aging baby boomers, and the young sycophants will rule the day. The dumbest of the bunch? The young sycophants as they will be paying for the mess and get very little for it.

Moscow Idaho makes the British Press

2008-11-02T17:02:00.000-08:00

Peter Hitchens on this little corner of the world in the Daily Mail of London.

As America approaches her most momentous presidential election for decades, I am in the True (but not specially Wild) West, the top left-hand corner of the United States, a hard-core Republican state that most visitors only fly over.

They think it's dull. How wrong they are...

Hitchens treats the average Moscow resident with respect.

On the other hand he has these representative observations about the local liberals:

...Mr Reece, a courtly retired academic-with a Colonel Sanders moustache and Danish ancestry, has Moscow's biggest concentration of posters backing Obama sprouting on his front lawn. He usually displays a good crop of placards at election times but admits that he has never put up so many before....
....Mr Reece's language about Obama is almost religious. He uses words such as 'visionary' and 'inspiration'. He also says, rather frankly, that Obama is 'not too black'. But he knows little about him.
He has never heard of Tony Rezko, the Chicago businessman recently convicted of fraud and corruption, who seems to have helped Obama buy his house, and whom Obama lobbied for.

He has also never heard of John Stroger, a dreary business-as-usual Chicago machine politician whom Obama backed against a reform candidate, rather undermining his claim to be the apostle of change, and to be much of a visionary....
...This knowledge puts him ahead of another deeply civilised Obama fan, Tom Lamar, a liberal member of the City Council and head of a not-for-profit environmental institute.

He hasn't heard of any of these unattractive and unvisionary figures in Obama's past and present. But despite being so weakly informed about his hero, he is an unshiftable supporter.

When I put it to him that Obama has been handled softly by the American media, Mr Lamar responded: 'I haven't really noticed any free pass. I don't feel that he is untested and unexamined.'....
...But he was stuck for an answer when I pointed out that an effigy of Sarah Palin, complete with glasses, red dress and beehive hair, had been suspended by the neck from a noose in a Hollywood street as part of a Hallowe'en display.

Police have described this as a legitimate expression of opinion. Perhaps. Yet it is quite clear that if anyone hanged Obama in effigy, especially in the Lynching Belt of the Deep South, it would ignite a huge explosion of rage, and not be treated as 'legitimate'....

It's the educated elite like Reece and Lamar that will lead the USA to its downfall. The elites in this country are uncritical in their thinking and resemble the emotionalism found in primitive charismatic churches. They speak in tongues, only they channel simple Marxist blather rather any supposed divine inspiration. The elites fail to understand the basis of this republic and the role of that unique American character of the individual. The hyper-aggressive nature of that American will now be diverted away from the market that produces goods for the masses based on a profit motive towards obtaining wealth from the government. Just use the public education system as prime example number one. We spend more per pupil and get less for it than any other country in the world. Thank the hyper-aggressive teacher's unions for that.

Savings rates in 401k's

2008-11-01T17:19:00.000-07:00

From the Seattle PI.

Although African-Americans are enrolled in employer- sponsored defined-
contribution plans at about the same rate as whites, they save far less each
month and have a considerably smaller portfolio balance. The median monthly
amount that blacks contribute to their 401(k) plan is $169, while whites
contribute about 50 percent more, or $249 each month. As a result, the median
total household savings for retirement reported by black respondents is $53,000,
compared with $114,000 for whites.

Could independent colleges be the next bubble?

2008-10-29T08:12:00.000-07:00

Discovered on PhiBetaCons from MSNBC:

By Maurna R. Desmond
updated 3:54
p.m. PT, Fri., Oct. 24, 2008

In June, 157-year-old Antioch College
decided to "suspend operations" at its flagship campus despite a push from
alumni to rescue the flailing institution. At that point, only 60 students were
enrolled, and their $40,000 per year tuition was being heavily subsidized by
Antioch's five newer campuses...

...The crunch will be particularly bitter for the institutions that drained
coffers to build "country club colleges" complete with luxury dormitories, spas and top of the line sports
complexes to lure choice students, hoping that a sharper crowd would lead to
more accretive diplomas, entering a profitable cycle of more successful alumni
and increased donations...

Obama Accepting Untraceable Donations

2008-10-29T07:52:00.000-07:00

From WaPo:

Contributions Reviewed After Deposits
By Matthew MoskWashington Post
Staff WriterWednesday, October 29, 2008; A02

Sen. Barack Obama's presidential campaign is allowing donors to
use largely untraceable prepaid credit cards that could potentially be used to
evade limits on how much an individual is legally allowed to give or to mask a
contributor's identity, campaign officials confirmed.

America's Most Overrated Product: the Bachelor's Degree

2008-10-27T19:12:00.000-07:00

From the Chronicle of Higher Education.

...Among my saddest moments as a career counselor is when I hear a story like this: "I wasn't a good student in high school, but I wanted to prove that I can get a college diploma. I'd be the first one in my family to do it. But it's been five years and $80,000, and I still have 45 credits to go."...

...Even worse, most of those college dropouts leave the campus having learned little of value, and with a mountain of debt and devastated self-esteem from their unsuccessful struggles. Perhaps worst of all, even those who do manage to graduate too rarely end up in careers that require a college education. So it's not surprising that when you hop into a cab or walk into a restaurant, you're likely to meet workers who spent years and their family's life savings on college, only to end up with a job they could have done as a high-school dropout....

McCain for President

2008-10-27T19:11:00.000-07:00

As only Charles Krauthammer can explain. From WaPo.

Embarrassed to tell people he's a journalist

2008-10-27T19:09:00.000-07:00

Via Betsy's Page.

Foreclosures Rocket Into Outer Space

2008-10-27T19:04:00.000-07:00

Via Bubble Markets Inventory Tracking blog.

The Age of Prosperity Is Over

2008-10-27T19:00:00.000-07:00

From Arthur B. Laffer via WSJ.

Tuition for State Universities

2008-10-21T08:19:00.000-07:00

The Solutions Through Higher Education site as data on tuition of state universities. Click on the following image.

Equal Opportunities = Equal Outcomes?

2008-10-19T08:08:00.000-07:00

In this discussion of Fannie/Freddie and why standards for loans were lowered there is this monster in the closet called racism. This is racism. However can we expect equal outcomes when people are given equal opportunities (EO=EO)? That seems to be the bedrock of post-modern thought. Male/female ratios must be 50/50 in all endeavors, black representation must be proportional (or even greater) than their fraction of the population (about 11%). However, what happens when numbers describing behavior defy the EO=EO principle? The cry of racism rings, subtle white male power structure is at work (implying the improbable proposition that men don't compete but hand out goodies to each other) , the test is unfair and is based on cultural biases, ....

So what happens when the 3 major races in America are compared on equal terms, in this case FICO scores? Here's a Freddie Mac publication on that. In the following figure we see that for the same FICO score the black/Hispanic rate is about twice as high as the white rate.

Is this racism? This is EO without the EO. The Fannie/Freddie GSE's obssesed about this. Besides the lack of EO=EO on the FICO scores. More blacks have low FICO scores:

June 20, 2008 Louisiana Weekly

Fannie Mae moves to exclude: Bad credit scores could forever deny borrowers home loans
By: By Lisa Loving

Posted: Friday, June 20, 2008 10:14 am

...Adams says that on the VantageScore credit scoring system, which runs from 501 to 990, 84 percent of African Americans had credit scores at the lower half of the spectrum, below 745, according to a report by the Federal Reserve Board. Such scores would require home-buyers to pay 40 percent of a home’s purchase price as the down payment....

The conversion of VantageScore to FICO (*0.86) has the 745 as 641 FICO. That puts the average black score of 641 FICO is in the 15th percentile and a probability of loan default between 15-30%. The average FICO score is 723 and most lenders won't consider a score below 700. Above FICO 700 puts the probability of default at about 2%. This means that blacks default at a rate that is about 10 times greater than the population as a whole. Zillow Blog has more data.

Why do blacks and Hispanics default at greater rates on loans? Perhaps the savings rates give a clue. From a column from the October 21, 2007 WaPo:

This year's Ariel-Schwab Black Investor Survey found that blacks had median investments of $48,000, compared with $100,000 for whites. The survey looks at blacks and whites who earn more than $50,000 annually.

Now does racism play a part in all of this? Consider that the USA savings rate as a whole is far below other nations. Who's discriminating against us?

Limbaugh and Hanity & Colmes listeners better informed than NPR

2008-10-16T10:28:00.000-07:00

Via Redcounty. A Pew Research study on politics of various news outlets. Limbaugh and Hanity & Colmes listeners bested NPR & New Yorker/Atlantic patrons. No surprise to me:

Here's a detailed breakdown of the percentage of individuals answering each of the three questions correctly from the different news audiences:

The New Yorker/Atlantic: 71 percent (correctly identified Democrats as the majority in the House), 71 percent (correctly identified Condeleeza Rice), 59 percent (correctly identified Gordon Brown)
NPR: 73 percent, 72 percent, 57percent
Hannity & Colmes: 84 percent, 73 percent, 49 percent
Rush Limbaugh: 83 percent, 71 percent, 41 percent
Colbert Report: 73 percent, 65 percent, 49 percent
Daily Show: 65 percent, 48 percent, 36 percent
NewsHour: 66 percent, 52 percent, 47 percent
O'Reilly Factor: 70 percent, 60 percent, 41 percent
C-SPAN: 63 percent, 59 percent, 35 percent
Letterman/Leno: 51 percent, 42 percent, 31 percent
CNN: 59 percent, 48 percent, 29 percent
National Enquirer: 44 percent, 32 percent, 22 percent

Education factor

In general, well-educated news audiences scored high on political knowledge. For instance, 54 percent of the regular readers of publications such as The New Yorker, The Atlantic and Harper's Magazine are college graduates, as are 54 percent of regular NPR listeners.

However, several news audiences with relatively low proportions of college graduates also scored well on the news quiz. Just 31 percent of regular "Hannity & Colmes" viewers are college graduates. Even still, 42 percent Hannity viewers got perfect scores on the political knowledge quiz, compared with 44 percent of NPR listeners.

Real Estate Market

2008-10-16T08:41:00.000-07:00

Check out your local market.

Shuttle driver reflects on Nobel snub

2008-10-16T08:35:00.000-07:00

From the Cape Cod Times. If I had the grant money I'd give him a call.

Twenty years ago, Douglas Prasher was one of the driving forces behind research that earned a Nobel Prize in chemistry this week. But today, he's just driving.
Prasher, 57, works as a courtesy shuttle operator at a Huntsville, Ala., Toyota dealership. While his former colleagues will fly to Stockholm in December to accept the Nobel Prize and a $1.4 million check, the former Woods Hole Oceanographic Institution scientist will be earning $10 an hour while trying to put two of his children through college.
....
After stints at a U.S. Department of Agriculture laboratory and working for NASA in Huntsville, Prasher was out of work for a year before he took a job at the car dealership.
Prasher said he has suffered from health problems and depression, some of which stems from being out of science for so long. But his sense of humor remains intact.

This year's physics and medicine prizes went to non-Americans. I think it's a trend.

More on Chris Dodd

2008-10-16T08:24:00.000-07:00

The man should be in prison pinstripes not on the Senate Banking Committee. From the WSJ.

In February 2004, while Republican colleagues warned of the systemic risks posed by Fannie Mae and Freddie Mac, Mr. Dodd pronounced the mortgage market "one of the great success stories of all time." A year later, the Connecticut Democrat voted against a reform that would have limited the size of Fan and Fred's mortgage portfolios. Now that Fan and Fred have collapsed at a cost to taxpayers that could run to $200 billion or more, Mr. Dodd is also under fire for accepting sweetheart loans from Countrywide Financial, the subprime mortgage factory.

Dodd Bedfellows

Dodd and Countrywide 10/10/2008 – The Senator should take the witness stand.
Mortgage VIPs 06/25/2008 – Sweetheart deals are just a phone call away.
Angelo's Angel 06/19/2008 – The senate bailout for Countrywide needs more scrutiny.
Congress and the Countrywide Scandal 06/18/2008 – Some senators want a bailout for big political donors. What a surprise.
Beltwaywide Financial 06/16/2008 – The new ARMs: Angelo-rated mortgages for senators.

Next up on the bubble horizon Medicare and Social Secruity

2008-10-16T07:32:00.000-07:00

A Washington Times Op Ed Piece.

The potential taxpayer bailout for Medicare alone is 50 times greater than the recently passed bailout bill. For all entitlements, the potential tab totals 80 times today's bailout.

It's highly unlikely that an Obama Administration will face this down. More likely scenario - he adds to the entitlement pig.

2 studies on the role of subprime mortgages and the current crisis

2008-10-14T17:04:00.000-07:00

Two recent papers have appeared on the causes of this the mortgage crisis. Gary Gorton of Yale has a very detailed one that describes the role of derivatives and Stan Liebowitz of UT-Dallas has another. They both pin the cause on the growth of subprime lending. Liebowitz attributes the disaster specifically on ARM's.

Gorton's paper is rich in data. For example on page 72 he shows the mind-boggling loss of $3.2 trillion in the sub-prime market. On page 52 he tracks the increases in defaults from 2003 to late 2007. For the prime market it went from 2.62 to 3.24%. For the subprime one it went from 13.04 to 17.31%.

ARM's, Alt-A, Prime Mortgages and Delinquency Rates

2008-10-14T17:01:00.000-07:00

Delinquency rates by mortgage types and FICO scores at the Zillow blog.

China goes for methanol from coal

2008-10-14T16:52:00.000-07:00

Now if we could also do the same. But we're sold on global warming, so no coal for us.

The production of methanol from coal gasification is a mature technology. In the United States, Eastman Chemical produces methanol from coal gasification at a plant in Kingsport, Tennessee that was built with support from the U.S. Department of Energy (DoE). Based on this experience, the U.S. DoE estimates that methanol can be produced from coal for as little as 50¢ per gallon. In China, production costs from coal are generally RMB$800-1,200 per metric ton of methanol (US$110-165/metric ton, or 33¢ to 50¢ per gallon). In addition, coke furnaces in China generate 80 billion cubic meters of waste gas each year, enough to produce 40 million metric tons of methanol, and significantly reduce pollution in the coal-producing regions. Coal-bed methane deposits of 30,000-35,000 billion cubic meters in China represent another significant energy resource as well as a hidden danger that claims miner’s lives each year. Just 1000 cubic meters of coal-bed methanol can produce one metric ton of methanol.

Fannie/Freddie, Regulations and Perpetual Motion Machines

2008-10-14T13:22:00.000-07:00

From the Main Street Column of the WSJ:

On Capitol Hill, he notes, we had just the opposite. In terms of accountability, Fannie Mae and Freddie Mac were the worst of both worlds. On the one hand, they lacked the congressional oversight that would have come had there been an explicit and acknowledged taxpayer guarantee. On the other hand, the privileged position represented by this implicit guarantee removed the discipline that market competition forces on other private enterprises.

Mr. Baker goes further. He points out that it wasn't the unregulated part of the financial markets that got us here. It was the regulated part. In his own industry, he notes, the lack of a government guarantee means folks do a lot more due diligence before they part with their money.

That regulated part being Fannie/Freddie with its supposed congressional oversight.

A recent comment on this blog said that the GOP was in charge when F&F were starting to show signs of trouble. True enough but the past blog posts here show that the Democrats blocked all oversight attempts, effectively killing it in committee. Remember that this is a democracy where the minority party gets a say. And I must add the GOP is a afraid of the racist label, so let the idiotic schemes go along their merry way. Not much leadership in either party. We have the stupid and egalitarian party or the let's not be known as the nasty party of racists.

With the polls the way they are you Democrats may just get the presidency with a congressional supermajority. You can start implementing your grand societal schemes - schemes that you'll find that work about as well as perpetual motion machines. Next up Social Security, then Medicare.

More on Fannie/Freddie

2008-10-08T10:27:00.000-07:00

The Fannie/Freddie debacle from Beliefcorner.com

In 1938, Fannie Mae was established by an act of Congress to provide liquidity to the mortgage market during an economic crisis known as the Great Depression. (Fannie history)
In 1970, over three decades later, Freddie Mac was established by an act of Congress to counteract Fannie Mae's growing monopoly of the secondary mortgage market. (Freddie history)
In 1977, the Carter Administration passed the Community Reinvestment Act (CRA) that required banks to offer an even disbursement of credit throughout the financial market in an attempt to curb past lending practices that targeted more desirable markets. At the time, republican critics charged that such an act would impose unnecessary regulatory burdens on lending institutions and distort credit markets by forcing banks to offer loans to under-qualified applicants.
In 1995, the Clinton Administration pushed even harder to increase the supply of affordable housing to low-income families by offering performance-based incentives (Lowered Standards) . According to economist Stan Liebowitz, these developments led to a loosening of lending standards that required no verification of income or assets, little consideration of the applicant's ability to make payments, and no down payment payments. The net effect was an inevitable collapse of Fannie Mae and Freddie Mac at the cost of its investors.
In April of 2001, the Bush Administration first red flagged Fannie and Freddie stating that "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity."
On September 10th of 2003, Treasury Secretary John Snow recommended to the House Financial Services Committee that Congress enact "legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises" and set prudent and appropriate minimum capital adequacy requirements.
In October of 2003, less than a month later, Fannie Mae disclosed 1.2 billion dollars in accounting errors.

In November of 2003, the Bush Administration upgraded their warning to a "systemic risk" that could very well extend beyond the confines of the housing market. In a July report, written by external investigators, it concluded that Freddie Mac manipulated its accounting to mislead investors. And other critics pointed out that Fannie Mae did not adequately hedge against rising interest rates.
In November of 2003, Council of the Economic Advisers, Chairman Greg Mankiw, argued that "legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk." And in order to do such, the regulator would have "broad authority to set both risk-based and minimum capital standards" and "receivership powers necessary to wind down the affairs of a troubled GSE." (Remarks of Dr. N. Gregory Mankiw Chairman Council of Economic Advisers at the Annual Meeting of the National Association of Business Economists)

Where are we headed? From the WSJ.

2008-10-04T16:45:00.001-07:00

The Wall Street Journal comments on the state of the housing bubble.

... Experts say that an additional 10% to 15% decline in house prices is needed to get back to the prebubble level. That decline would double the number of homes with negative equity, raising the total to 40% of all homes with mortgages. The mortgages of five million homeowners would then exceed the value of their homes by 30% or more, which could prompt millions of defaults...

NY Times on Fannie

2008-10-04T16:39:00.000-07:00

A fairly good description of the debacle.

...Fannie, a government-sponsored company, had long helped Americans get cheaper home loans by serving as a powerful middleman, buying mortgages from lenders and banks and then holding or reselling them to Wall Street investors. This allowed banks to make even more loans — expanding the pool of homeowners and permitting Fannie to ring up handsome profits along the way...
...Fannie never actually made loans. It was essentially a mortgage insurance company, buying mortgages, keeping some but reselling most to investors and, for a fee, promising to pay off a loan if the borrower defaulted. The only real danger was that the company might guarantee questionable mortgages and lose out when large numbers of borrowers walked away from their obligations....
...Whenever competitors asked Congress to rein in the companies, lawmakers were besieged with letters and phone calls from angry constituents, some orchestrated by Fannie itself. One automated phone call warned voters: “Your congressman is trying to make mortgages more expensive. Ask him why he opposes the American dream of home ownership.”....

C-Span clips on Freddie/Fannie hearings from 2002-2004

2008-09-29T15:21:00.000-07:00

An 8.5 minute video of C-Span clips of various Democrats defending Fannie/Freddie back in the early 2000's when Bush, McCain and company were trying to regulate this GSE. Found at Colossus of Rhodey.

A Video of the Fannie/Freddie Crisis

2008-09-27T15:06:00.000-07:00

A long 10 minute Youtube video on the Fannie/Freddie crisis found at Right Mind.

A Video Explanation of the Fannie/Freddie mess

2008-09-25T09:19:00.000-07:00

Found over at Verum Serum, a history of Fannie/Freddie debacle. You can guess which political party looks worse in all of this.

Fannie's Orphans

2008-09-24T13:50:00.000-07:00

From the September 24, 2008 Seattle Times:

Says the repo middle man: Forget the bailout. Banks, homeowners: They mostly don't deserve it.

"You know what homes are in foreclosure? The ones where people sucked all the equity out," Shank says. "They went to Vegas. They bought Suburbans. They didn't think past whatever day it was."

Sen. Chris Dodd (D-Conn) Chair of the Senate Banking Committee, Hypocrite Extraordinaire

2008-09-24T09:04:00.000-07:00

From Betsy's Page quoting Victor Davis Hanson:

Why are these guys in charge of deciding on the bailout

There is some cognitive dissonance in seeing Chris Dodd chair the hearing on the bailout in the Senate Banking Committee yesterday. As Victor Davis Hanson writes,
Very odd to see a Sen. Chris Dodd, of all people, today defiant and outspoken in his regard for the people:

if only he had returned (never too late) lavish contributions from Freddie Mac and Frannie Mae (as Senate banking chairman, he was their #1 targeted recipient and raked in over $160,000);

if only in the midst of a loan crisis, he had not received below-market-rate VIP loans from the now late great, melted-down Countrywide for whose parochial interests he championed;

if only he had not been instrumental in blocking past proposed firewalls that might have prevented the collapse of the two agencies that were the catalyst for this mess;

if only he had a bit of contrition for his own role in this national mess.

Surely in the interest of transparency and conflict of interest, any Senator, Republican or Democrat, who accepted money from Freddie and Frannie, or any of the imperiled investment houses, should recuse themselves from the present hearings—but then there might not be a quorum.
These are the same Democrats on the Banking Committee who three years ago blocked reform of Fannie Mae and Freddie Mac thus allowing the problems to metastasize for three more years. Remember, just a couple of months ago, Dodd was denying that there was any problem with Fannie and Freddie...........................

Gramm-Leach-Bliley Act vs. Fannie/Freddie

2008-09-23T09:00:00.000-07:00

I've been hearing a lot about this present financial debacle being based on the Gramm-Leach-Bliley Act of 1999 which deregulated certain banking sectors. This is mostly put forth by Democrats hoping to draw attention away from THEIR Fannie/Freddie mess. Betsy's page has a good analysis of this.

.....Gramm-Leach-Bliley did not create securitization and collateralized debt obligations. It did not change the rules for banks’ leverage ratios. If anything, Gramm-Leach-Bliley mitigated some risks by allowing financial companies to diversify their businesses, and it is the most diversified firms that are best weathering the storm.........

...In 2005, the Senate Banking Committee, then under Republican control, adopted a strong reform bill, introduced by Republican Sens. Elizabeth Dole, John Sununu and Chuck Hagel, and supported by then chairman Richard Shelby. The bill prohibited the GSEs from holding portfolios, and gave their regulator prudential authority (such as setting capital requirements) roughly equivalent to a bank regulator. In light of the current financial crisis, this bill was probably the most important piece of financial regulation before Congress in 2005 and 2006. All the Republicans on the Committee supported the bill, and all the Democrats voted against it. Mr. McCain endorsed the legislation in a speech on the Senate floor. Mr. Obama, like all other Democrats, remained silent.

Now the Democrats are blaming the financial crisis on "deregulation." This is a canard. There has indeed been deregulation in our economy -- in long-distance telephone rates, airline fares, securities brokerage and trucking, to name just a few -- and this has produced much innovation and lower consumer prices.....

'Crony' Capitalism Is Root Cause Of Fannie And Freddie Troubles

2008-09-22T20:17:00.000-07:00

From the Investor's Business Daily.

...It all started, innocently enough, in 1994 with President Clinton's rewrite of the Carter-era Community Reinvestment Act.
Ostensibly intended to help deserving minority families afford homes — a noble idea — it instead led to a reckless surge in mortgage lending that has pushed our financial system to the brink of chaos....
...Fannie and Freddie, the main vehicle for Clinton's multicultural housing policy, drove the explosion of the subprime housing market by buying up literally hundreds of billions of dollars in substandard loans — funding loans that ordinarily wouldn't have been made based on such time-honored notions as putting money down, having sufficient income, and maintaining a payment record indicating creditworthiness.

With all the old rules out the window, Fannie and Freddie gobbled up the market. Using extraordinary leverage, they eventually controlled 90% of the secondary market mortgages. Their total portfolio of loans topped $5.4 trillion — half of all U.S. mortgage lending. They borrowed $1.5 trillion from U.S. capital markets with — wink, wink — an "implicit" government guarantee of the debts.

This created the problem we are having today.

As we noted a week ago, subprime lending surged from around $35 billion in 1994 to nearly $1 trillion last year — for total growth of 2,757% as of last year....

How the Democrats Created the Financial Crisis: Kevin Hassett

2008-09-22T15:12:00.000-07:00

From Bloomberg.

....But really, it isn't. Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally...

....What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.
Different World

If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.

But the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.....

A Mortgage Fable

2008-09-22T09:09:00.000-07:00

From the September 22, 2008 Wall Street Journal.

Obama, Barney Frank, Bush and Fannie/Freddie

2008-09-22T09:00:00.000-07:00

Over at Verum Serum.

NY Times Explains Fannie Mae and the GOP

2008-09-22T08:56:00.000-07:00

From the Doug Ross Journal.

WaMu in Orange County CA

2008-09-22T07:31:00.000-07:00

From the September 19, 2008 OC Register:

In July 2007, Vijay and Supriti Soni of Corona del Mar paid $440,000 for a home at 2129 W. Civic Center Drive in Santa Ana.

Five weeks later, they resold the house to Javier Hernandez – the family gardener and handyman – for $660,000. That's a 50 percent gain in 38 days – at a time when real estate prices in Santa Ana were plunging........

The Subprime Loan Machine; Automated Underwriting Software Helped Fuel a Mortgage Boom

2008-09-22T07:22:00.000-07:00

More on sub-prime loan software, from the March 23, 2008 NY Times:

...Automated underwriting ''replaced the ways we used to extend credit,'' said Prof. Nicolas P. Retsinas, director of the Joint Center for Housing Studies at Harvard....

..Samir Rohatgi, a vice president at MindBox, said that old system of manual underwriting actually encouraged loan officers working on commission to grant bad loans...

The old cliche' garbage in, garbage out applies here.

The Diversity Recession

2008-09-22T07:09:00.000-07:00

From Steve Sailer at VDare:

...In recent times, investors have typically gotten rich in our society by betting on the rich to get richer. And most of the time, that's what happens: the rich get richer. Every so often, however, we have a meltdown because, during the bubble, investors temporarily overestimated the rate at which the rich will get richer—e.g., Silicon Valley in 2000, the Texas oil patch in 1982, commercial real estate developers around 1990, and so forth.....
...What's totally strange about the mortgage meltdown, however, is that the bet, at its base, was on the more marginal members of society to be able to pay off their inflated debts—a bet on the pretty-close-to-poor to get pretty-close-to-rich.

And that made no sense at all....

Fannie Mae and Countrywide

2008-09-21T22:14:00.000-07:00

Fannie Mae and Countrywide, perfect together, from 1999:

NEW YORK--(BUSINESS WIRE)--April 19, 1999--

Fannie Mae (NYSE:FNM), the nation's largest source of financing for home mortgages, and Countrywide Credit Industries, Inc., the nation's largest independent residential mortgage lender, today announced that Countrywide's proprietary automated underwriting system, marketed as e-Approve(TM) and CLUES(TM), will be available on Fannie Mae's MORNETPlus Network...........

WaMu's Story

2008-09-21T20:41:00.000-07:00

A Seattle Times Story:

.......................The answer, stripped of the lingo of high finance, is simple: WaMu loaned too much money to people who couldn't afford to pay it back.

From 2004 to the end of 2007, WaMu made $452.5 billion in some of the riskiest types of home loans: subprime loans, home-equity loans and short-term adjustable-rate mortgages, especially so-called "option ARMs," which allowed people to choose how much they wanted to pay each month.

Many borrowers, unsurprisingly, chose to pay as little as possible. Like credit-card users making only the minimum monthly payment, they ended up owing more than they'd originally borrowed.

All in all, more than half of WaMu's real-estate loans during that period were in one of those three categories. And they were the kinds of loans most likely to go sour once the housing boom cooled and the economy started to sputter.........................
.............In addition, WaMu made billions of dollars' worth of loans with only "limited documentation" of the borrowers' income, net worth or credit history. Such loans — often called "liar loans" or "NINJA loans," for "no income, no job or assets" — made up three-quarters of WaMu's option-ARM portfolio at the end of 2007..........

Were these NINJA loans aimed at illegeal aliens?

HOW FEDS INVITED THE MORTGAGE MESS

2008-09-21T20:11:00.000-07:00

More on the Fannie/Freddie subprime mess, from the NY Post:

......Flexible lending programs expanded even though they had higher default rates than loans with traditional standards. On the Web, you can still find CRA loans available via ACORN with "100 percent financing . . . no credit scores . . . undocumented income . . . even if you don't report it on your tax returns." Credit counseling is required, of course.

Ironically, an enthusiastic Fannie Mae Foundation report singled out one paragon of nondiscriminatory lending, which worked with community activists and followed "the most flexible underwriting criteria permitted." That lender's $1 billion commitment to low-income loans in 1992 had grown to $80 billion by 1999 and $600 billion by early 2003.

Who was that virtuous lender? Why - Countrywide, the nation's largest mortgage lender, recently in the headlines as it hurtled toward bankruptcy.......

What is the root cause of the current mortgage crisis?

2008-09-19T09:12:00.001-07:00

Excellent post at the Doug Ross Journal.

Who tried to reform Fannie Mae and Freddie Mac?

2008-09-18T10:22:00.000-07:00

An excellent post over at Betsy's page.

$35,000/year salary and a $290,000 mortgage

2008-09-18T08:51:00.000-07:00

This story pretty much sums up the root cause of the mortgage crisis.

"Cortez makes $35,000 a year and has a poor credit history. Oliver Marquez, a financial counselor at the nonprofit Resurrection Project who advised Cortez, said the original $290,000 mortgage was well beyond his means."
"More recently, some lenders have offered Alt-A loans to people who lacked sufficient documentation to get a traditional loan"

Another story from Bloomberg:

"McLean, Virginia-based Freddie, which reported an $821 million quarterly loss two days ago, said that Alt-A mortgages were the biggest reason for a surge in its foreclosure losses. The delinquency rate for the $190 billion of the loans owned by Freddie or underlying the bonds the company guarantees jumped to 3.7 percent on June 30, from 1.8 percent on Dec. 31"
"For minorities and immigrants, the ownership rate is less than 50 percent and that's what we're focusing a lot on and I think that that's where a lot of the growth in the market will be,'' Freddie Chief Executive Officer Richard Syron said in a interview with Bloomberg Television in 2004."

The Real Culprits In This Meltdown

2008-09-17T12:01:00.000-07:00

From Investor's Business Daily.

The Real Culprits In This Meltdown

By INVESTOR'S BUSINESS DAILY | Posted Monday, September 15, 2008 4:20 PM PT

Big Government: Barack Obama and Democrats blame the historic financial turmoil on the market. But if it's dysfunctional, Democrats during the Clinton years are a prime reason for it.

OBAMA TRIED TO STALL GIS' IRAQ WITHDRAWAL

2008-09-15T10:55:00.000-07:00

WHILE campaigning in public for a speedy withdrawal of US troops from Iraq, Sen. Barack Obama has tried in private to persuade Iraqi leaders to delay an agreement on a draw-down of the American military presence.......[more]

2008-09-15T08:50:00.001-07:00

Congressional recipients of Fannie Mae and Freddie Mac campaign cash.

2008-09-15T08:40:00.000-07:00

The UK increases scrutiny of university degrees. From the BBC. Another one.

2008-09-14T21:18:00.000-07:00

Teacher Salaries in Washington, via Seattle P-I.

How Fannie and Freddie weren't reined-in

2008-09-14T14:58:00.000-07:00

A good explanation of how the Fannie and Freddie were allowed to brew from MSNBC.com.

....Fannie Mae and Freddie Mac were ascendant, giants of the mortgage finance business and key players in the Clinton administration's drive to expand homeownership.....

...In October 1992, a brief debate unfolded on the floor of the House of Representatives over a bill to create a new regulator for Fannie Mae and Freddie Mac. On one side stood Jim Leach, an Iowa Republican concerned that Congress was "hamstringing" this new regulator at the behest of the companies. He warned that the two companies were changing "from being agencies of the public at large to money machines for the stockholding few."

On the other side stood Barney Frank, a Massachusetts Democrat who said the companies served a public purpose. They were in the business of lowering the price of mortgage loans.

Congress chose to create a weak regulator......

.....The Clinton administration wanted to expand the share of Americans who owned homes, which had stagnated below 65 percent throughout the 1980s. Encouraging the growth of the two companies was a key part of that plan......

....The result was a period of unrestrained growth for the companies. They had pioneered the business of selling bundled mortgage loans to investors and now, as demand from investors soared, so did their profits.....

.....Fannie Mae and Freddie Mac enjoyed the nearest thing to a license to print money. The companies borrowed money at below-market interest rates based on the perception that the government guaranteed repayment,.....

.......In 2003, Richard H. Baker (R-La.), chairman of the House Financial Services subcommittee with oversight over Fannie Mae and Freddie Mac, got information from OFHEO on the salaries paid to executives at both companies. Fannie Mae threatened to sue Baker if he released it, he recalled. Fearing the expense of a court battle, he kept the data secret for a year. Baker, who left office in February, said he had never received a comparable threat from another company in 21 years in Congress. "The political arrogance exhibited in their heyday, there has never been before or since a private entity that exerted that kind of political power,".....

College Football's Highest-Paid Losers

2008-09-12T15:43:00.000-07:00

From Forbes Magazine.

College Daze

2008-09-10T14:45:00.000-07:00

by Charles Murray
Published in Forbes Magazine 9/1/2008

College is not all it's cracked up to be. Dumbed-down courses, flaky majors and grade inflation have conspired to make the letters B.A. close to meaningless. But another problem with today's colleges is more insidious: They are no longer a good place for young people to make the transition from childhood to adulthood. Today's colleges are structured to prolong adolescence, not to midwife maturity....[more]

College is not a Must

2008-09-03T10:05:00.000-07:00

From the CSM

College is not a Must

........The total damage inflicted on students by the college-is-for-everyone mentality is incalculable. Students who cannot measure up to the demands for a college curriculum are made to feel like failures...........

Age of shroud of Turin disputed again

2008-08-24T08:45:00.000-07:00

A Times of London story......

......A LEADING expert on the shroud of Turin has won the support of an Oxford University laboratory for new carbon dating tests on the venerated but controversial relic, which was dismissed two decades ago as a fake. ......

.....John Jackson, a physicist at Colorado University and a prominent expert on the relic, has argued that the tests were skewed by 1,300 years because of high levels of carbon monoxide. He said many other elements of the shroud, including details of the image, indicate that it is much more ancient......

Group	Public Institutions (on ACT scale of 36)	Private Institutions (on SAT scale of 1,600)
Race
--White	--	--
--Black	+3.8	+310
--Hispanic	+0.3	+130
--Asian	-3.4	-140
Class
--Lower	-0.1	+130
--Working	+0.0	+70
--Middle	--	--
--Upper-Middle	+0.3	+50
--Upper	+0.4	-30