Shepherds Piehole

Obama to Recreate 2008 Housing Crisis with New Executive Orders

Posted By LambChop

From The Washington Post:

President Obama is about to roll out a new round of executive orders, one of which will allow homeowners to refinance their mortgages. Obama will use these executive orders to by-pass congressional duty and his constitutional authority to willfully expand the powers of the Executive branch to absurd proportions.

Obama reportedly also has plans for additional executive orders to new further promote “rights” for  gays and lesbians (“protecting” gays in the workplace); to regulate corporate cyber security  issues;  to continue his campaign of environmental regulation by forcing  buildings to be more “energy-efficient”;  and to deliver the final death blow to existing coal-fired power plants with new regulations.

 “It is a very dangerous road he’s going down contrary to the spirit of the Constitution. Just because Congress doesn’t act doesn’t mean the president has a right to act.” ~Sen. Charles E. Grassley (R-Iowa) 

Obama apparently believes that an executive order  to allow more than 11 million “struggling homeowners”  to refinance at today’s ultra-low interest rates will boost the housing market, regardless of the fact that today, 90% of  loans are government- backed (Fannie Mae and Freddie Mac)  and 40% of those loans are already subprime.

Obama’s blatant disregard of the causes of the financial crises in 2008 ignores the fact that the crash of the housing market and banks left holding “bad paper” (subprime loans) catapulted the U.S. into the worst financial crisis since the Great Depression.

Obama previously used executive powers to make refinancing easier for those with loans already guaranteed by Fannie Mae and Freddie Mac. His new plan will extend this order to include privately backed mortgages.

 

http://www.washingtonpost.com/politics/obama-weighing-executive-actions-on-housing-gays-and-other-issues/2013/02/10/e966cc06-7065-11e2-8b8d-e0b59a1b8e2a_story_1.html

 

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Golf Great Phil Mickelson Faces off Against Taxmageddon

Posted By LambChop

From AP and Fox News:

Golf Legend Phil Mickelson vows to make some “drastic changes’ as he faces the ridiculous consequences of California Governor Jerry Brown and Obamanomics – a 62-63% total tax rate in his home state of California.

According to Sports Illustrated, Mickelson was the second-highest earning athlete of 2012, second only to boxing’s Floyd Mayweather,

"It's been an interesting off-season. And I'm going to have to make some drastic changes. I'm not going to jump the gun and do it right away, but I will be making some drastic changes. I'm not going to jump the gun and do it right away, but I will be making some drastic changes. There are going to be some drastic changes for me because I happen to be in that zone that has been targeted both federally and by the state and, you know, it doesn't work for me right now. - Phil Mickelson

Mickelson lives in Rancho Santa Fe, California and is a native of San Diego. California’s Proposition 30 raised the state sales tax and created tax brackets that punished millionaires like Mickelson. For income exceeding $1 million, the state rate jumped to 13.3 percent from 10.3 percent. For Mickelson, who earned roughly $60 million in 2012 (an increase of more than $1.8 million).

"If you add up all the federal and you look at the disability and the unemployment and the Social Security and the state, my tax rate's 62, 63 percent," Mickelson said. "So I've got to make some decisions on what I'm going to do."

Mickelson’s options include moving away from California or retiring altogether. Mickelson decided against pursuing partial ownership of the San Diego Padres last year because of the sale of the franchise and coming tax axe.  

Mickelson’s dilemma illustrates the economic futility of raising tax rates to punish the wealthy. The wealthy will simply avoid paying the hire rate, fail to invest in future enterprises, decide against hiring or creating jobs and take their money and sit on it – not a viable way to build an economy or raise government revenues.

 

Do it Phil! RT @governorperry Hey Phil....Texas is home to liberty and low taxes...we would love to have you as well!! tinyurl.com/b3zuhnd

— Justin Green (@JGreenDC) January 21, 2013

 

Read more: http://www.foxnews.com/sports/2013/01/21/golfer-phil-mickelson-plans-drastic-changes-over-new-tax-rate/#ixzz2IdCz0zul

 

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NAR Lobbies for Mortgage Interest Deduction (Video)

Posted By LambChop

Gary Keller is actually a  lot like Yoda 

 

Children's Cartoon Teaches Tunisian Kids How to Make Molotov Cocktails

Posted By LambChop

From Pamela Geller at Atlas Shrugs:

The “Arab Spring” continues to push up daisies. Never ones, to miss an opportunity for Jihad, Muslims in Tunisia have involved the kids in helping to kill the infields. The kids can even get instructions on how to make their own Molotov cocktails thanks to magazine for kiddos, "Kaws Kouzah.” The magazine,  complete with cartoon illustrations,  gives the recipe for making a Molotov cocktails and goes on to write: “the unit should be ignited and thrown at the enemy. After the initial contact, the bottle breaks and penetrates the target.”...

Awesome! Maybe next month there can be a feature on how to clean bubblegum off your RPG.

There is some hope however, the magazine  faces a lawsuit from the Tunisian Ministry for Women and Family Affairs. 

 

 

 

http://atlasshrugs2000.typepad.com/atlas_shrugs/2012/10/muslim-childrens-comic-book-publishes-detailed-step-by-step-instruction-of-how-to-make-a-molotov-coc.html

 

QE3: It's Back!

Posted By Lambchop

QE3 Today's the Day. The Fed announces round three of  Quantitative Easing: 

1. The Fed  says it will spend $40 billion a month to buy mortgage-backed securities 

2.The Fed extended a plan to keep short-term interest rates at record lows through mid-2015. 

The Fed is trying to keep interest rates low by purchasing more securities with newly printed money (and cap rates on market-driven interest rates). Quantitative Easing  is the only trick the Fed has up its sleeve left to hopefully  achieve price stability, prevent a rise in interest rates, and lower unemployment.  

Critics say that a third bond-buying program will not stimulate the economy  because certain sectors of the economy are no longer sensitive to the lowering of interest rate. 

Expect there to be a political cost with this annoucement - not good news for the Obama administration because many critics of QE  view it as passing the buck and glossing over the real economic problems.  There are most likely diminishing returns with this next shot in the arm. 

 

Pro Life Sign Causes Neighborhood Furor

Posted by Lambchop

THE WOODLANDS, Texas, an affluent suburb North of Houston, Texas is embroiled in a yard sign controversy.

The sign in question had been placed in Michael Towers front yard every year for the past 4 years – it was an advertisement for a pro-life rally “Pray to End Abortion – 40 Days of Life”. This fall after a neighbor’s complaint, Towers was asked to remove the sign by the DSC and Design Review Committee.

The two committees continue to say that it is not the “message” but the sign did not “fit in with their current design standards” so they disallowed it. But, the problem is that no one is clear about which standards it violated.

Kyle Watson, attorney and resident of The Woodlands  pointed out that the” township” is a state entity  in that it receives tax dollars (and apparently uses a .gov  URL on the website), and, therefore, is prohibited from  regulating a sign based on content.“These are vague and ambiguous standards. Your third option would be best, there should be no restrictions on the signs’ messages, ” said Watson,

The Township Chair, Mike Bass resigned after the removal notification was issued.

This is a prime example of creeping liberalism and a favorite tactic of the left - hide behind vague regulations and lie about their true agenda. 

 READ MORE: http://woodlandsonline.com/npps/story.cfm?nppage=47830

 

 

City of Angels and Big Apple Decide to Feed the Community Reinvestment Act Gremlin After Midnight

Posted by Lambchop

Perhaps one of the most overused and clichéd quotes is this:   the definition of insanity is to do the same thing over and over again expecting different results. I submit this should be the inspirational quote for the Democratic Party Platform since literally all of their failed social experiments and fiscal policies fall under this mantra.

From the Great Depression and New Deal forward, we know these policies attack stable markets and adversely impact economic growth. We also know that the huge impact of the housing crises clearly had a domino effect which caused  the worst financial crises since the 1920s. In the mid 2000s, housing values inflated (many refer to this artificial inflation as a "bubble"). Loose credit requirements, failure to regulate derivatives and a host of other ridiculous liberal legislation pushing Fannie Mae and Freddie Mac to increase loans to dubious borrowers all contributed to the bursting of the bubble.

The result of the shoddy mortgage lending led to excessive packaging and sale of loans to investors. This in turn fueled the risky bets on securities backed by the loans which were shaky in the first place.

Although the information is not readily available, we know from insurance groups, the mortgage banking association and some private studies (like the Woodstock Institute) that, generally speaking, consumers living in minority communities were more likely to have non-prime credit scores, while individuals in mostly white neighborhoods were more likely to have prime credit scores.

The disparity is obvious when you look at populations by race and neighborhood: about 50-55% percent of the population in overwhelmingly-black neighborhoods had scores below 620 ( a common cut off for prime lending) while only about 14-17%  percent in mostly-white neighborhoods had credit scores below 620.

Because these problems have not been addressed and only exacerbated by the high unemployment /underemployment rates, credit scores have continued to fall since 2008 – particularly in the minority community where consumers have been hit hard. Similarly, the market in many areas is still trying to absorb foreclosed and already devalued properties.

In spite of these truths, the liberal policies that contributed to this madness are back in full swing. Now banks are being regulated into making more risky home loans by CITY diversity police. Yes, at the CITY level.

New York and Los Angeles both have brilliantly decided to expand the “Community Reinvestment Act” and have approved laws requiring banks doing business to meet race-based quotas for mortgages. Both cities are set to adopt measures to stop foreclosures and vow to open new branches in urban neighborhoods. Imagine the impact of this artificial interference to the already strained housing values

Mayor Bloomberg, showing some predictive ability, is reportedly set to veto it (his city council can and will override his vote) while Los Angeles genius mayor, Antonio Villaraigosa is full speed ahead.

The unintended consequences of these idiotic ideology-ridden policies are that they effectively transform CITY authorities into bank regulators along with the federal government, adding yet another layer of enforcement. Imagine the paperwork, the bureaucracy, the cost of compliance to CONSUMERS required (not to mention the additional pressure tactics on banks to make these risky loans while being simultaneously punished for potentially not meeting whatever the minority requirements may be).

But don’t be fooled – these citified bank regs are coming to a city near you – Austin, TX, San Diego, CA,  and Boston, MA and just a few of the cities preparing to put these regulations in place.

This is a recipe for disaster in the housing market.

Super Tuesday is a Little Less Super

Photo by USA Today

Posted by Lambchop

President Obama plans to hold a press conference today (his first since November of last year).

FoxNews reports that

“Obama was to announce plans to let borrowers with mortgages insured by the Federal Housing Administration refinance at lower rates, saving the average homeowner more than $1,000 a year. Obama also was detailing an agreement with major lenders to compensate service members and veterans who were wrongfully foreclosed upon or denied lower interest rates.”

http://www.foxnews.com/politics/2012/03/06/obama-to-hold-1st-news-conference-year-in-middle-super-tuesday/

The reality is that $1,000 a year (about $84 per month) does NOT even cover the increase in fuel bills of the average family.

According to AAA stats, the average American uses about 533 gallons of fuel a year in their automobile. Gas prices averaged $1.84 per gallon when Obama took office  and, today,  prices average  $3.70 per gallon.

In a family with 2 drivers, increased fuel prices over the past 3 years have already cost about twice as much as the “savings” on the mortgage payment.

What should trouble those who subscribe to free market principles is that in the current climate of record- breaking underwater homeowners, there are still  75% of homeowners with a 125% LTV (Loan to Value) who are  making their payments on time. If we continue to make policy based upon our government “saving” those who are underwater…we may inadvertently be incentivizing those "75% paying on time folks " to default. More later.