Is The Occupy Wall Street Movement an Answer to The Tea Party Movement?

[Conan71]

In the meantime, as I have said several times; I have no problem whatsoever letting the Bush tax cuts expire for everyone, across the board - including myself.  I say this looking at the financial disaster that my generation - Boomers - and now yours (40 something? - also my kids age) - is inflicting on my grandkids and great grandkids (two and counting...under 60 is WAY too young to have great grandkids!).  Hopefully, your financial situation will never take any adverse turns that hurt your kids.  And I hope they appreciate what you are trying to do for them.  A little extra tax on you will not derail that particular train.  Not paying a little extra now, when it CAN make a difference may be another matter.

We literally have a catastrophe for our society building every day.  And only two things can even hope to alleviate; reduce spending and raising taxes.

When it's framed in that light don't you think it sounds far more reasonable than trashing people for their wealth or our President saying "these people make enough already", "They need to start paying their fair share", "We need to spread the wealth around"?  Or calling it claptrap like "economic justice"?

A few points in tax doesn't necessarily make or break the economy, but when you make it sound like "us against them" what incentive is there for someone to want to take more risk.  Millionaires and billionaires can far easier spread their wealth around directly into the economy than the government can with their taxed funds.

[heironymouspasparagus]

You and the rest of the wealth redistribution mind set fail to realize that higher taxes for the rich will not translate into higher incomes for the rest of us.  

And I notice you conveniently edited out how well "fairness" worked for Cuba.  

Cuba first; well, you know that has nothing to do with anything.  That's why I ignored it - it is irrelevant.  Just to let you know my mindset on that, though - and I quote;  "But if you go carrying pictures of Chairman Mao, you ain't gonna make it with anyone anyhow....


I am completely and totally against wealth redistribution - and that is exactly why I am against allowing it to continue as it has for so long in this country.  Even a 5th grader could understand the wealth distribution that has gone on in this country.  They only have to look at all the charts and graphs and data that has been put up on this site in the last year or two.

[heironymouspasparagus]

When it's framed in that light don't you think it sounds far more reasonable than trashing people for their wealth or our President saying "these people make enough already", "They need to start paying their fair share", "We need to spread the wealth around"?  Or calling it claptrap like "economic justice"?

A few points in tax doesn't necessarily make or break the economy, but when you make it sound like "us against them" what incentive is there for someone to want to take more risk.  Millionaires and billionaires can far easier spread their wealth around directly into the economy than the government can with their taxed funds.

Few points of tax is exactly what "make or break" this economy.  We swung from 250 billion surplus to 250 billion deficit in the first year after the cuts.  Then it got worse due to certain spending events...when a little adjustment would have made a tremendous difference.  Bush could have been a hero for the best economic performance in history, if only he had been smart enough to figure it out.

But they aren't.

[Conan71]

Few points of tax is exactly what "make or break" this economy.  We swung from 250 billion surplus to 250 billion deficit in the first year after the cuts.  Then it got worse due to certain spending events...when a little adjustment would have made a tremendous difference.  Bush could have been a hero for the best economic performance in history, if only he had been smart enough to figure it out.

But they aren't.

His tax cuts would have appeared brilliant if not for 9/11, Katrina, and multiple other unprecedented disasters.  He effed up by not retracting them when it became apparent we were running up some serious debt as a result of all these unforeseen emergencies and their far reaching effects like foreign wars and huge new bureaucracies.

[Conan71]

I am completely and totally against wealth redistribution - and that is exactly why I am against allowing it to continue as it has for so long in this country.  Even a 5th grader could understand the wealth distribution that has gone on in this country.  They only have to look at all the charts and graphs and data that has been put up on this site in the last year or two.

Yep, you and Che, two peas in a pod.

[guido911]

[Gaspar]

There are a lot of them though.

Look, I've remained mainly quiet on this issue because for the most part, I understand what their beef is, but I think they direct alot of their ire at the wrong people or group of people.

First off, not all people in the top 1% sit around all day long thinking of ways circumvent the current tax code.  Is the current tax code right now aligned to make it easier for those with wealth to find loopholes?  Sure it is.  If you want to keep alot of your money, you'll try and find those loopholes.  Or you'll hire someone to do it for you.  Even if you're a 99er.

Alot of the problem right now is that many business owners (which could be individuals, or, in the case of where I work, a group of investors, or a unified investment group) don't know how the economy is going to shake out.  So instead of hiring, they're bankrolling money.  Unemployment remains flat or even creeps up a little.  Who could blame them.  If you think you're going to lose your job, and you have a decent amount of money in your primary checking account through good spending habits, you're not going to go out and hire a maid or a nanny that you might not need, but might actually help you in the long run because he or she would free up your time to be creative and increase your income by allowing you more time to work.

They should be, however, more mad at those people who put our asses in this mess.  AIG/Goldman Sachs/BofA (I know, I'm a customer of theirs, but for a small checking account only) deserve the lions' share here.  Wasn't that who the main beef was with the begin with?  Should it not be?  These three entities, specifically AIG, nearly bankrupted the country with their spending habits.  And the government fell for their 'Too Big To Fail' meme.

We should also be mad with every president since Reagan (D and R) for de-regulation and more de-regulation of the financial sector.  It allowed these companies to go out and spend like a drunk sailor with an American Express Gold Card.  And why wouldn't they?  They learn by example (i.e. the GubMINT).  The Republicans keep saying 'don't regulate, the market will work itself out'.  We saw what that did in 2008.  I have a hard time believing alot of them would even say it in these times when our ND is now at $15 trillion.

Be mad at those institutions.  Be mad at ponzi schemes.  Be mad at our government for falling hook/line/sinker for the 'help us, help us' corporate attitudes.  Be mad at the 'golden parachutes'.  Be mad at the frivolous, lavish parties these companies threw while we were bailing them out.  Stop being angry at people, who, through hard work, have earned enough money to make them comfortable and living in the 1 percent.  They're not the enemy here.  Don't be mad at the stock broker on Wall Street who is making a living like the rest of us.  Be mad at those on Madison Ave who think that because they run an investment bank, that they should be able to have in their personal bank account enough to start a bank of their own via 'severance packages' and 'consulting fees'.  I'm sick of hearing about people who spend maybe 2 hours a day working and make $50 million a year from stock options and base salary complain about being castigated by the government because they feel like they're getting 'what they're worth'.

It's not what I would consider any of them worth.

Wow!  I almost agree with you on many of your points, but you fail to identify the real collusion.  You see, I can't just blame the banks, they were doing what banks do.

Our "collapse" was not caused by the banks themselves.  It was caused by an influx of cheap money.  That money came from a single place.  It came from a single policy.  Banks don't make it their business to loan money to people who can't pay it back UNLESS they have a backer.  All of a sudden in the 90s, tens of millions of people who could not afford a home, suddenly were golden!  Tens of millions more who already owned a home were gods.  The $50,000 a year that used to afford a family an apartment or a small 2 bedroom house now qualified them for a $250,000 home.  Why?  Because the federal government became co-signer.  In 1992 changes to the Community Reinvestment Act required Fanny May and Freddy Mac to purchase low-income high-risk loans.  Because the banks viewed these entities as "government run," they were happy to process and sell as many mortgages as possible to them.  Fanny and Freddy were willing to buy just about anything, because as part of their role they were required to devote their lending practices to affordable housing, rather than realistic risk assessment.  When some of those loans failed, as expected, Freddy and Fanny were there to clean up the mess and shovel it under the carpet.  Hell the economy was flush with this cheap money and jobs were plentiful, the gamble was worth it!  Or was it?

You see, the government is very bad at anticipating the unintended consequences of it's actions.

Because of this heroin binge, the developers scraped the land and struggled to keep up with the hunger for new homes.  We saw the local birth of folks like Greg Simmons who were building hundreds of homes at a time, selling 10, 20 a day, and D.R. Horton nationally who could build and sell hundreds a day.  Massive resources and human capital were involved in keeping these machines running.  From the lumber mills, to the glasers, to the light-bulb manufactures. Our entire economy revolved around cheap housing.  Banks grew to gargantuan size, and new banks seemed to materialize out of nowhere.  The little banks would package loans and sell them to the bigger banks, and they would in-turn create all kinds of investment instruments out of them.  Demand for land in some areas caused values to skyrocket, some as high as 30% a year. 

The fact that a family of two could own their own home with no work history, and in many cases no credit history, and no down payment was suicidal. Sure the bankers knew we were headed for a fall.  Sure congress and the presidents knew it.  Everyone knew it.  Clinton, Greenspan, Bush, Barney Frank, and his boyfriend. . .they all knew.  Everyone was high on the heroin.  Everyone is to blame.

The important thing, is not the blame, it's the lessons.

The lesson is that eventually someone has to pay.  The lesson that past financial performance always dictates future financial performance.  The lesson that the less someone has to work for something the less they appreciate it. The lesson that charitable lending leads to ruin.

So now here we are trying to point a finger.  Because some people became wealthy riding bulls, people blame them. 

I blame those who let the bulls loose in the first place!

[Hoss]

Wow!  I almost agree with you on many of your points, but you fail to identify the real collusion.  You see, I can't just blame the banks, they were doing what banks do.

Our "collapse" was not caused by the banks themselves.  It was caused by an influx of cheap money.  That money came from a single place.  It came from a single policy.  Banks don't make it their business to loan money to people who can't pay it back UNLESS they have a backer.  All of a sudden in the 90s, tens of millions of people who could not afford a home, suddenly were golden!  Tens of millions more who already owned a home were gods.  The $50,000 a year that used to afford a family an apartment or a small 2 bedroom house now qualified them for a $250,000 home.  Why?  Because the federal government became co-signer.  In 1992 changes to the Community Reinvestment Act required Fanny May and Freddy Mac to purchase low-income high-risk loans.  Because the banks viewed these entities as "government run," they were happy to process and sell as many mortgages as possible to them.  Fanny and Freddy were willing to buy just about anything, because as part of their role they were required to devote their lending practices to affordable housing, rather than realistic risk assessment.  When some of those loans failed, as expected, Freddy and Fanny were there to clean up the mess and shovel it under the carpet.  Hell the economy was flush with this cheap money and jobs were plentiful, the gamble was worth it!  Or was it?

You see, the government is very bad at anticipating the unintended consequences of it's actions.

Because of this heroin binge, the developers scraped the land and struggled to keep up with the hunger for new homes.  We saw the local birth of folks like Greg Simmons who were building hundreds of homes at a time, selling 10, 20 a day, and D.R. Horton nationally who could build and sell hundreds a day.  Massive resources and human capital were involved in keeping these machines running.  From the lumber mills, to the glasers, to the light-bulb manufactures. Our entire economy revolved around cheap housing.  Banks grew to gargantuan size, and new banks seemed to materialize out of nowhere.  The little banks would package loans and sell them to the bigger banks, and they would in-turn create all kinds of investment instruments out of them.  Demand for land in some areas caused values to skyrocket, some as high as 30% a year.  

The fact that a family of two could own their own home with no work history, and in many cases no credit history, and no down payment was suicidal. Sure the bankers knew we were headed for a fall.  Sure congress and the presidents knew it.  Everyone knew it.  Clinton, Greenspan, Bush, Barney Frank, and his boyfriend. . .they all knew.  Everyone was high on the heroin.  Everyone is to blame.

The important thing, is not the blame, it's the lessons.

The lesson is that eventually someone has to pay.  The lesson that past financial performance always dictates future financial performance.  The lesson that the less someone has to work for something the less they appreciate it. The lesson that charitable lending leads to ruin.

So now here we are trying to point a finger.  Because some people became wealthy riding bulls, people blame them.  

I blame those who let the bulls loose in the first place!

But shouldn't someone in the banks financial department be seeing this to begin with?  I mean, you have all these financial institutiions...shouldn't they be forecasting what is going to happen if they do X, or if they do Y?

I do blame the banks.  I also blame the lack of regulations.  I blame lobbying because in a lot of cases the banks were lobbying for de-regulations.  They spent all that money in the halls of Washington, and then it winds up on the backs of the American taxpayer.  Sure, most have paid back the loans.  But the fact that we had to bail them out...WE BAILED THEM OUT...is telling.

So yes, I blame the banks.  I full-on point the fingers.  The banks wanted the deregulation.  They got it via lobbying.  Look what happened.

Hopefully the banks learn their lesson.  Somehow I doubt it.

[Gaspar]

But shouldn't someone in the banks financial department be seeing this to begin with?  I mean, you have all these financial institutiions...shouldn't they be forecasting what is going to happen if they do X, or if they do Y?

I do blame the banks.  I also blame the lack of regulations.  I blame lobbying because in a lot of cases the banks were lobbying for de-regulations.  They spent all that money in the halls of Washington, and then it winds up on the backs of the American taxpayer.  Sure, most have paid back the loans.  But the fact that we had to bail them out...WE BAILED THEM OUT...is telling.

So yes, I blame the banks.  I full-on point the fingers.  The banks wanted the deregulation.  They got it via lobbying.  Look what happened.

Hopefully the banks learn their lesson.  Somehow I doubt it.

But it wasn't any deregulation that caused this.  There were regulations.  The banks did not lobby for the Federal Housing Enterprises Financial Safety and Soundness Act of 1992.  That was created as an initiative by Rep. Henry Gonzalez and Senator Don Riegle.  It is what caused the bubble.

The reduction in regulations took place when Riegle developed the Riegle-Neal Interstate Banking and Branching Efficiency Act which made it easier for the banks to bundle and sell these things over state lines. It actually increased competition between banks, and caused an explosion of new banks, especially in states like Oklahoma where banking laws are easy.  Pretty soon we had a bank on every corner, and in every grocery store.  Car dealerships even became their own banks.   But to some extent you are right.  The influx of all of these new banks, and the free flow of money across state borders made the bubble, born in 1992, grow even faster.  Unfortunately, this increased freedom of trade cannot be blamed for  for the tragic policies that the changes to the CRA in 1992 represented.  That would be like blaming WIND for a forest fire started by a cigarette.

[Conan71]

But shouldn't someone in the banks financial department be seeing this to begin with?  I mean, you have all these financial institutiions...shouldn't they be forecasting what is going to happen if they do X, or if they do Y?

I do blame the banks.  I also blame the lack of regulations.  I blame lobbying because in a lot of cases the banks were lobbying for de-regulations.  They spent all that money in the halls of Washington, and then it winds up on the backs of the American taxpayer.  Sure, most have paid back the loans.  But the fact that we had to bail them out...WE BAILED THEM OUT...is telling.

So yes, I blame the banks.  I full-on point the fingers.  The banks wanted the deregulation.  They got it via lobbying.  Look what happened.

Hopefully the banks learn their lesson.  Somehow I doubt it.

Of course the banks knew about this, but with the guarantee of the federal government behind each and every risky note, the bank essentially had no skin in the game.  All they needed to do was service the loan, collect their interest, and if the loan went tits up, they were protected by Fannie and Freddie.  They didn't even have to collect the interest, they could bundle the loans and make money off the back end selling them to investors.

The sad part is this is nothing new.  No lessons were learned.  You and I both lived through the HUD glut of the late 1980's and the collapse of the savings and loan thrift industry.  Banks became reluctant to lend money for homes and the economy began to stagnate and go into a recession late in President Bush's run in office.  What was the solution?  "Hey let's make this a no lose proposition for banks and get these homes off inventory and into the hands of people who have never owned a home and who stand little chance of ever owning one."  And here we are again.  Same situation 25 years since the last housing bust.

Countrywide and others went totally aggressive on home equity loans promising 110% of equity.  Anyone in the federal government who didn't see the flaws in that was smoking crack.  Yet the government was just as complicit if not more so for essentially endorsing such ludicrous behavior by agreeing to be the co-signor on these risky notes.  

Due to the profit motives of banks, there's no way they would have made the vast majority of those loans without such a secure co-signor.  Banks, by their nature, are actually incredibly risk-averse.  

Granted, they did participate whole-heartedly in this orgy and they knew all along the bottom would fall out at some point, but there was really no penalty to them.  Between private PMI carriers and the feds, they really had nothing to lose.

Edited to add:

Now watch what happens next:  There will be a new housing act designed to make housing affordable to everyone.  The government will be a willing backer of these loans with new oversight.  Somewhere into the first five years of this, the government will relax their oversight, you will start getting mailers for 110% home equity loans... rinse, spit, repeat.  By 2035 or sooner, we will be in the same mess all over again, right about the time you and I are eyeballing our investment accounts and rubbing our balding heads realizing there's no retirement in the near future.

[Hoss]

Of course the banks knew about this, but with the guarantee of the federal government behind each and every risky note, the bank essentially had no skin in the game.  All they needed to do was service the loan, collect their interest, and if the loan went tits up, they were protected by Fannie and Freddie.  They didn't even have to collect the interest, they could bundle the loans and make money off the back end selling them to investors.

The sad part is this is nothing new.  No lessons were learned.  You and I both lived through the HUD glut of the late 1980's and the collapse of the savings and loan thrift industry.  Banks became reluctant to lend money for homes and the economy began to stagnate and go into a recession late in President Bush's run in office.  What was the solution?  "Hey let's make this a no lose proposition for banks and get these homes off inventory and into the hands of people who have never owned a home and who stand little chance of ever owning one."  And here we are again.  Same situation 25 years since the last housing bust.

Countrywide and others went totally aggressive on home equity loans promising 110% of equity.  Anyone in the federal government who didn't see the flaws in that was smoking crack.  Yet the government was just as complicit if not more so for essentially endorsing such ludicrous behavior by agreeing to be the co-signor on these risky notes.  

Due to the profit motives of banks, there's no way they would have made the vast majority of those loans without such a secure co-signor.  Banks, by their nature, are actually incredibly risk-averse.  

Granted, they did participate whole-heartedly in this orgy and they knew all along the bottom would fall out at some point, but there was really no penalty to them.  Between private PMI carriers and the feds, they really had nothing to lose.

Edited to add:

Now watch what happens next:  There will be a new housing act designed to make housing affordable to everyone.  The government will be a willing backer of these loans with new oversight.  Somewhere into the first five years of this, the government will relax their oversight, you will start getting mailers for 110% home equity loans... rinse, spit, repeat.  By 2035 or sooner, we will be in the same mess all over again, right about the time you and I are eyeballing our investment accounts and rubbing our balding heads realizing there's no retirement in the near future.

Balding?  You've seen me C...I'm pretty close...

But then again, that's where you and I will agree to disagree, I guess.  I hold the banks AND the regulatory commissions fully responsible.  To say the banks aren't responsible kinda reminds me of saying that guy who killed someone else isn't responsible because the police didn't stop him.  This ain't Minority Report.  And there lies the problem.  You can have regulation, but unless it actually has teeth, who will abide by it.  You have to force the regulations to have teeth.

[Conan71]

Balding?  You've seen me C...I'm pretty close...

But then again, that's where you and I will agree to disagree, I guess.  I hold the banks AND the regulatory commissions fully responsible.  To say the banks aren't responsible kinda reminds me of saying that guy who killed someone else isn't responsible because the police didn't stop him.  This ain't Minority Report.  And there lies the problem.  You can have regulation, but unless it actually has teeth, who will abide by it.  You have to force the regulations to have teeth.

Of course they have responsibility in this, but they had a willing co-conspirator who shares the blame and made it easy for banks to engage in such stupid behavior.

[Hoss]

Of course they have responsibility in this, but they had a willing co-conspirator who shares the blame and made it easy for banks to engage in such stupid behavior.

That much we do agree on.

[guido911]

Who's up for occupying Albert Pujols? I hear he was offered $225M by the Marlins that he might not share with other people. Here's the chant:

"We..Are..The People Jealous of Pujols"

[Hoss]

Who's up for occupying Albert Pujols? I hear he was offered $225M by the Marlins that he might not share with other people. Here's the chant:

"We..Are..The People Jealous of Pujols"

Sort of wondered who would be the bidders after the WS.  I'd like to see him stay in St Louis, but understand you have to market yourself.  St Louis has also proven that they can and will spend to keep marquis players.  I know lots of people who thought the Cards were crazy for signing Lance Berkman.  As a former resident of Houston I knew how good he was.  The Cards got a great deal on him...