Joe Biden: Real Man of Genius

Goat Team from Shorpy

I love Shorpy.com. This picture is just one reason why:

Pakistan: Another Fantastic Set of Pictures from Boston.com

Boston.com has another fantastic set of pictures—this time from Pakistan.

The Chicago Trading Floor Doesn’t Like Obama’s Mortgage Plan

The simple truth is that almost any actions to prop up the mortgage market is doomed. But Obama’s plan is particularly bad. Here’s an amusing video of one of CNBC’s anchors on the Chicago trading floor getting the traders riled up and promoting a new “tea party” on taxes.

Throwing gas on a fire: How Obama solves economic problems

Today Obama unveiled a $75 billion mortgage plan. It is a silly plan based on politics not common sense. In his Inaugural Address he said, “Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age.”  He is now guilty of the same mistakes that put us in our current financial predicament because he doesn’t want to make “hard choices.”

Housing in America has become overvalued. This is a foreseeable result of government policies. After 9/11 Greenspan held interest rates too low, government incentives favor housing debt, and private actors created a speculative bubble in housing. As a result, housing prices had to drop—and drop they did. Now Obama wants to make housing prices increase even though the market is can’t sustain higher prices. He is trying to put out the fire of mortgage problems by pouring gas on it. To get to a stable economic system, housing prices need to find the floor, not be artificially increased.

Just an example of Obama not being willing to make the hard choices he excoriated others for making.

Michael Lewis on the Houston Rocket’s Shane Battier

Michael Lewis loves story about teams or people exploiting hidden data. That’s the theme of his books about sports and the stock market. Check out his latest article in NY Times magazine about Shane Battier. I just wish the Houston Rocket’s coaching staff had opened up like Oakland’s General Manager Billy Beane did during the writing of Moneyball.

Why today is one of the greatest days of the year

No, it doesn’t have anything to do with Valentines’s Day, though it does remind me that I’m very grateful to be married to someone wonderful. Today is my mother-in-law’s birthday and my uncle’s birthday, and while they are great, that isn’t why today is so great.

Today is great because pitchers and catchers report to spring training. The season is just around the corner.

Remember When Democrats Complained about Bush and the Republicans for the Deficit?

When the Republicans were in power, they didn’t do a good job of being fiscal conservatives. Republican apologists tried to cloud Bush’s free-spending ways by saying there hadn’t been much increase in non-defense spending, as if we shouldn’t consider the billions we were spending in Iraq and Afghanistan. 

But the Democrats have outdid themselves this time. Even if Obama and Congress don’t spend another dime after the Stimulus, the deficit will be 13% of GDP. At least the Democrats are living up to their free spending reputation…

Someday I want to go to Beirut

Check out these pictures from Michael Totten and see if you don’t agree with me.

What Obama, Bush, Geithner, and Paulson have failed to understand about banks and lending

Banks don’t lend to hold, they lend to sell. Bush and Paulson propped up the Wall Street banks as if they would start lending to people and then hold the debt. But that’s not the business today’s banks want to be in. Banks want to originate loans, bundle them up, and sell the loans leaving the banks will little to no risk. 

The part of lending that has become very expensive is lending to people that are at all credit risks or buying up bundled loans that are at all risky. That’s the problem.

It’s not clear how Tim “I can’t do my own taxes, but I can both diagnose and fix the financial system” Geithner will create enough trust that people will be willing to lend money to anyone or any enterprise that has much risk.