Saturday, October 25, 2008

The Senate's Recidivists

The guys that crashed the train, are still trying to run it....

A railroad engineer who caused as much damage to a freight train, as these guys did to our economy, would be in jail at this point, not back behind the throttle. Yet here we have the unrepentant Senators Chuck Schumer (D., Fannie), Jack Reed (D., Freddie) and Robert Menendez (D., N.J.) calling on the Treasury to set "lending goals" for banks receiving capital injections under Treasury Secretary Hank Paulson's rescue plan. The press release issued by Senator Schumer's office complained that banks receiving public capital "may not fulfill the main goal of the Treasury program, which was to increase lending activities in order to unfreeze the credit markets." Instead, these Senators said, the banks might choose to "hoard" the cash.

The Wall Street journal reports that:

"Banks must understand that these funds aren't a gift," Senator Menendez warned, ominously. And here we thought that "not a gift" was covered in the part of the plan that requires the banks to pay interest on the capital to taxpayers on a preferred basis over private shareholders.
Note to Senator Schumer, et al.: Banks don't make money by "hoarding" it, or "stuffing it under mattresses," in the New York Democrat's words. They make money by lending. But lending has been constrained in part because losses on past lending and investment have left the banks short of capital. If a bank should decide that keeping that capital unfettered is better than going bankrupt, for example, that should not be taken as evidence of greed or a lack of public spiritedness. Nor would compelling banks to make loans ensure that "taxpayers are protected," as Senator Reed claimed. In fact, the opposite could be true, depending on the magnitude of potential losses from loans already on the books and the quality of the new loans.
After more than a year of losses on mortgage investments, declining home prices and credit-market turmoil, the banks are busy rebuilding their balance sheets. More banks are likely to fail before this thing is over, and some of them will likely have received money from the Treasury along the way. The first priority for banks has to be to build up their capital base and dispose of dodgy assets so taxpayers don't take those losses.
What the banks need from each other is confidence that their balance sheets are sound. Calling on them to return to pre-crisis levels of lending, as the Senators do, has exactly the opposite effect: It increases the odds that they will take on business to please political masters, not because they can afford to do so.
Now that Treasury is buying bank stakes, the danger is that every politician in the Beltway will want a special dividend payable to him. This is one more reason for the Treasury, in this Administration or the next, to appoint someone to run this program who cannot be bullied. Mr. Paulson is still asleep at that switch.

The Senators' letter is another reminder, if one were needed, that the sooner the feds get out of the banking business, the better for the banks, the economy and the country.

Once again we have Sen. Chuck Schumer, the same person who caused a run on IndyMac by releasing letters to the public that he sent to bank regulators and to the Federal Home Loan Bank of San Francisco, attempting to manipulate private banking operations.  

It is now known that, just coincidentally with the timing of Sen. Schumer's destruction of IndyMac,  a group of investors  who have donated more than $700,000 to Senate Democrats and the Democratic Senatorial Campaign Committee during the four years that Sen. Schumer has chaired the campaign committee, were targeting IndyMac, and just waiting for the price to be run down (there must be a Justice Department investigation of Schumer's actions).

This present action of Sen. Schumer, along with other Democrats, is clear notice of the Democrat's bold intentions to exercise significant interference and control of the financial markets, in an attempt to shape our economy in a way that will once again have disastrous results similar to their culpability with Fanny May and Freddy Mac.  

It's imperative that additional safeguards must be set up in order to prevent additional hazardous interference and manipulation by Congress.

St. Crispen's Day Speech, October 25th

St. Crispen's Day Speech
  Shakespeare's HENRY V
C. 1599

Although Shakespeare penned this work nearly two hundred years after the Battle of Agincourt (1415), it remains the finest dramatic interpretation of what leadership meant to the men in the Middle Ages.
Prior to the Battle, Henry V had led his English footmen across Northwestern France, seizing Calais and other cities in an attempt to win back holds in France that had once been in English possession and to claim the French crown through the obscure but powerful Salig Law.
The French, aware of Henry's troops weaking condition because of their distance from England and the attacks of Dystentary that had plagued the dwindling band, moved between King Henry and Calais, the port he needed to reach in order to return to England. The troops followed Henry's band along the rivers, preventing their crossing and daring them to a battle they thought they could not win.
The English knights fought on foot after the manner devised by Edward III. Archers were to be used in support, the English and Welsh longbows having established their credentials both at Crecy (1347) and at Poiters (1356). But here the French seemed to have sufficient numbers to deal with even this threat, and they refused to allow Henry pass, angered by the English seizure of the cities.
Morale in the English line as they looked upon the overwhelming force of heavily armoured, highly skilled French knights must have been extremely low. King Henry, rising to the occasion, spoke words of encouragement that rallied the English troops and carried them to a victory. As a result of the victory the French Princess Catherine was betrothed to Henry V, and France and England were at peace for the remainder of Henry's short life. He perished of dysentery in 1422, but was survived by his son (Henry VI) and was buried at Westminster Abbey, close to the shrine of Edward the Confessor.
Although the speech below is a work of fiction, it is evocative of the spirit with which Henry--and all strong medieval kings--ruled through the strength of their convictions and by force of their personality.
--Brian R. Price
--January 30, 1998 

St. Crispen's Day Speech
William Shakespeare, 1599
                                  Enter the KINGWESTMORELAND. O that we now had here     But one ten thousand of those men in England     That do no work to-day!   KING. What's he that wishes so?     My cousin Westmoreland? No, my fair cousin;     If we are mark'd to die, we are enow     To do our country loss; and if to live,     The fewer men, the greater share of honour.     God's will! I pray thee, wish not one man more.     By Jove, I am not covetous for gold,     Nor care I who doth feed upon my cost;     It yearns me not if men my garments wear;     Such outward things dwell not in my desires.     But if it be a sin to covet honour,     I am the most offending soul alive.     No, faith, my coz, wish not a man from England.     God's peace! I would not lose so great an honour     As one man more methinks would share from me     For the best hope I have. O, do not wish one more!     Rather proclaim it, Westmoreland, through my host,     That he which hath no stomach to this fight,     Let him depart; his passport shall be made,     And crowns for convoy put into his purse;     We would not die in that man's company     That fears his fellowship to die with us.     This day is call'd the feast of Crispian.     He that outlives this day, and comes safe home,     Will stand a tip-toe when this day is nam'd,     And rouse him at the name of Crispian.     He that shall live this day, and see old age,     Will yearly on the vigil feast his neighbours,     And say 'To-morrow is Saint Crispian.'     Then will he strip his sleeve and show his scars,     And say 'These wounds I had on Crispian's day.'     Old men forget; yet all shall be forgot,     But he'll remember, with advantages,     What feats he did that day. Then shall our names,     Familiar in his mouth as household words-     Harry the King, Bedford and Exeter,     Warwick and Talbot, Salisbury and Gloucester-     Be in their flowing cups freshly rememb'red.     This story shall the good man teach his son;     And Crispin Crispian shall ne'er go by,     From this day to the ending of the world,     But we in it shall be remembered-     We few, we happy few, we band of brothers;     For he to-day that sheds his blood with me     Shall be my brother; be he ne'er so vile,     This day shall gentle his condition;     And gentlemen in England now-a-bed     Shall think themselves accurs'd they were not here,     And hold their manhoods cheap whiles any speaks     That fought with us upon Saint Crispin's day.

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