McCain's advisor Phil Graham being blamed for the mess on Wall Street, higher gas prices and the spiraling down of our economy: What do you think?

The Commodities Future Modernization Act passed in December 2000 is most likely a leading cause of our crisis. This act was written by Phil Graham, pushed quickly through a lazy congress in December 21 of 2000, and offered the deregulation which made credit default swap investments possible. Look it up. Learn about it. Make your own assessment instead of listening to media. Why did lenders make such risky loans? Because they thought they had purchased insurance which would cover the loss if the mortgage went into default, and, of course, they make money off of making loans. Sounds great. Sounds like a no risk for the banker. Problem is, the credit default swaps which insure these loans have absolutely no regulation and the wall street institutions made apparently a 50 to 60 trillion dollar industry out of selling these unregulated default insurance investements with apparently no real assets of any kind to back them.
Lenders cannot colllect on these expensive default insurance policies they bought to insure the loans they made, many of which are now going into default. Wall Street was paid the premimus, but they did not set aside capital to pay off the policies when claims are made. This should be illegal, but this is what you get with dereguation. So the American public takes a double hit to pay the bill. It gets slightly more complicated when you throw in the mortgage backed secuities trading, the hedging, and the short selling, but in the end we lose our money in the stock market, and then we have to pay again by using tax payer's money to bail out the corrupt institutions.
While Phil Graham was no doubt a key player in this global sham on the public. Phil, by the way, after retirment from the Senate, is now employed with a Swiss Bank, USB, a major player in the credit swap industry. He is certainly a great American Patriot!
But we can't blame him in entirety. President Clinton signed the bill into law with no complaints. What's up with that Bill? I personally blame, the public. The vast majority of Americans take no time to educate themselves regarding politics. They could tune in on what is taking place in Congress and the bills and laws being introduced and passed, they could read, learn, -- but we would rather watch Survivor or 90210 or TilaTequila.
When I talk to people about the elections, they are mostly interested in "what am I going to get out of it." I want my medicine paid for. I want more tax credit. I want, I want. Which candidate will put more in my pocketbook? They are not concerned with the burden they are putting on young workers and future generations. They are not concerned with the pollution of our environment or even the abuse and corruption-- just what's in it for me? They readily accept the fact that government is corrupt. So, I suppose that we do have a true representation of the public in Washington. I do love my country and I know there are people out there who are willing to sacrifice for their country rather than drain what they can for themselves. These people must somehow find each other. I would like to remind us all that this country was founded by people who would, by todays terms, be labeled as radical, or even terrorists. They did not believe that their government was serving the their best interest, so they shed their own blood, and began an experiment in democracy, allowing people to govern themselves. They put, not only their blood, but great effort and thought into developng a document which would ensure that future generations would have the power to control the government and be able to make changes when necessary, without having to shed the blood of their sons and daughters. We still have that right today. But we fail to exercise it. The Democratic and Republican Parties have dominated our thoughts. They are nothing but red herrings, allowing a handful of very wealthy individuals and corporations to promote their own agendas while givng us someone else to blame. We can elect people to our local, state, and federal governments who belong to neither party. Why don't we?

McCain saw the handwriting on the walls, three years ago!!!

John McCain was one of three Republicans in the U.S. Senate to sponsor the bill. Rising to propose the legislation, Senator McCain’s words now sound prophetic:

Senator McCain Speaks in Support of
The FEDERAL HOUSING ENTERPRISE REGULATORY REFORM ACT OF 2005
The United States Senate
May 25, 2006

“Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.

The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.

The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.

For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.

I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.”

McCain took action in 2005 that might have helped us avoid the severity of this current financial crisis. Democrats also took action in 2005…and stopped McCain’s reforms.

What finally happened to this legislation????? Despite Democrat opposition to that measure, the bill passed the House, but could not get a vote in the Senate even after the anti-lobbying provision was removed.

Let’s meet Barack Obama’s Finance Chairperson, Penny Pritzker.

We all know that Barack Obama hangs out with some interesting people and Penny Pritzker is no exception. I thought you might like to know more about Penny Pritzker and the closing of Superior Bank, which was owned by the Pritzker family.

The Pritzkers are one of the nation’s wealthiest families and heirs to the fortune created by the Hyatt hotels. Yes, Penny is a billionaire. So basically, Penny could squash me like a bug right now for writing this.

Among their other endeavors, the Pritzkers were the owners of Superior Bank in Hinsdale, Illinois when it was seized.

Yes, I did say seized.

Penny Pritzker, Barack Obama’s great Chicago (of course!) friend was a pioneer you might say! She was a failed subprime lender who set the tone all the way back to 2001. She did it before it was even in style.

Below is a 2001 press release from the Office of Thrift Supervision (OTS)

OTS Closes Superior Bank FSB; Hinsdale, Ill. Thrift is Insolvent

WASHINGTON – The Office of Thrift Supervision (OTS) closed Superior Bank FSB, Hinsdale, Ill., today and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver.

The FDIC transferred the insured deposits and substantially all the assets of Superior Bank into a newly chartered, full-service mutual savings bank, known as Superior Federal, FSB, which will open for business on Monday morning. All depositors of Superior Bank automatically become depositors of Superior Federal, and will have immediate access to their insured funds. All 18 of Superior Bank’s Chicago metropolitan area offices will open for business Monday and will continue to offer full banking services, including online banking. Superior Bank’s loan production and servicing operations will also continue to operate normally.

OTS used its authority under the FDIC Improvement Act of 1991 to close Superior Bank when it found that the bank remained critically undercapitalized — that its tangible equity capital was less than two percent of its total assets. The bank failed to implement a capital restoration plan that it submitted to OTS on May 24 this year.

Superior Bank suffered as a result of its former high-risk business strategy, which was focused on the generation of significant volumes of subprime mortgage and automobile loans for securitization and sale in the secondary market. OTS found that the bank also suffered from poor lending practices, improper record keeping and accounting, and ineffective board and management supervision.

Superior became critically undercapitalized largely due to incorrect accounting treatment and aggressive assumptions for valuing residual assets. The bank also experienced significant losses during 2000 from its automobile lending program.

OTS has determined that Superior Bank is insolvent, having incurred losses that have depleted all or substantially all of its capital. OTS also determined that Superior Bank was no longer able to transact business in a safe and sound manner.

OTS notified the bank of its serious concerns in July 2000.

The bank was purchased by two families in 1988 — the Pritzker family of Chicago, owner of Hyatt Hotels and other interests, and the Dworman family of New York, with interests in real estate and financial services activities — and was operated through a complex network of holding companies.

In light of these findings, OTS determined that closure and the appointment of FDIC as receiver were necessary to protect the interests of the bank’s insured depositors.

As of March 31, 2001, the failed bank had total assets of $1.9 billion and total deposits of $1.5 billion. FDIC insures depositors’ accounts up to the statutory limit of $100,000.

Superior is the only bank that OTS has closed in 2001, and only the fourth OTS-regulated institution closed in the past five years.

The FDIC has established a toll free telephone number for customers of Superior. That number is 1-800-331-6306, and will be available until midnight tonight and then from 7 a.m. to 7 p.m. daily thereafter.

At the time of this seizure, it was determined that Penny Pritzker and her family owed $460,000,000 to the Federal Government. Yes, that’s right folks. Nearly a half a billion dollars. Gee, i wonder if that’s all paid back yet, don’t you?

Your really close on this.... I am glad to see the word getting out.

This started with the 'Contract With America' with Newt and company running the congress in 96'. 'Deregulate it all' was the mantra.

What is really significant is understanding why the Glass-Steagall Act was put in place in 1933 after the banking meltdown. The Glass-Steagall Act was put in place to stop exactly what is happening now.

Also you're missing one VERY important piece of legislation that set this up, the repeal of the 'Glass-Steagall Act' in 1999. The bill was sponsored by none other than Phil Gramm. It was called the 'Gramm-Leach-Baily Act'. This little gem allowed the merger of Banks, Investment and Insurance companies.

With all of this in place, the great 'shell game' of mortgage lending could take place. All bad debt could be rolled into a package, be sold down stream and eventually end up on the doorstep of Fanny and Freddie and it did.

If people reading this still don't get it... here is one more side note....

Joe Binden voted AGAINST both of these bills.
John McCain voted FOR both of these bills.

The 'Enron Loophole' was not as significant in this conversation as the repeal of the 'Glass-Steagal Act' with the Gramm-Leach-Baily Act

There were 99 other senators, 435 Congressmen and one President (anybody care to guess who) involved in passing that bill, they should all be held responsible for not doing their jobs, I'm tired of hearing their excuses that they don't have time to read the whole bill blah blah blah. Then don't pass it! See what happens when you don't pay attention to details. I would say from what I have read Phil Graham and his wife have been rewarded handsomely for their involvement.

For starters, the legislation contained a provision—lobbied for by Enron, a generous contributor to Gramm—that exempted energy trading from regulatory oversight, allowing Enron to run rampant, wreck the California electricity market, and cost consumers billions before it collapsed. (For Gramm, Enron was a family affair. Eight years earlier, his wife, Wendy Gramm, as cftc chairwoman, had pushed through a rule excluding Enron's energy futures contracts from government oversight. Wendy later joined the Houston-based company's board, and in the following years her Enron salary and stock income brought between $915,000 and $1.8 million into the Gramm household.)

Congress is aware of the problem and lawmakers recently passed legislation to address the “Enron Loophole,” one of the major loopholes that opens the door to abusive trading practices, but the law didn’t go far enough.

Unfortunately, other loopholes exist that allow energy trading on completely “dark” exchanges. For example, the “Foreign Markets Loophole” allows American energy commodities to be traded overseas – exempt from U.S. oversight.

These so-called “Dark Markets” – commodities markets that are not policed by U.S. authorities provide for an open the door to manipulation, even outright control of the markets.

For example, speculative investors can buy and sell millions of barrels of U.S. destined oil and other energy products every day in the United Kingdom and even in Dubai… but are not made subject to the transparency and accountability laws that govern exchanges here in the United States!

Additionally, through the so-called “swaps loophole,” financial investors can “game the markets” for pure profit by buying up positions in the energy markets, without any limitation on the size of the positions they can take. One recent estimate suggested that they now control one third of the commodities markets, or $150 billion - a 1,000% increase in less than five years!

Some experts believe that as much as 60 percent of the cost of a gallon of gasoline, diesel fuel, or heating oil can be attributed to pure speculation and abusive –even manipulative – trading practices, yet most trading is “dark” and federal authorities can neither fully police or see the data in the majority of the trading markets.

The energy trading markets were originally set up to provide energy producers and distributors with an environment to manage risk and produce the best possible price for their customers. But they are clearly no longer the driving force in the market.

The policymakers in Washington can help reduce the price of oil by shutting down all the loopholes, including the foreign markets and swaps loopholes, and by getting tough on speculative investors and profiteering energy trades and swaps. The United States economy depends upon a reliable supply of energy available at a fair price in a free market. You can help restore the principles of the free market by calling your Congressional representatives and the White House, urging them to pass legislation ensuring that all energy trading is fully transparent, accountable to the rule of law, and based on supply and demand principles.

Here is the number for the Congressional switchboard 1-866-340-9281 this is something you can do to make your voice heard, trust me your Congressional Rep. probably doesn't read the polls on SH your going to have to call them. Your tax dollars pay for this toll free # NOW CALL AND BITCH.

It's just disgusting - the level of nepotism, cronyism and corruption in our government is just staggering. Over the past 8 years while the average American has been focused on "fighting them there so we don't have to fight em here", and other nonsense like opposing same sex marriages, the GOP has been systematically dissolving all the regulatory checks and balances that were in place (in some cases dating back to the depression) to safeguard against everything that is occurring now. Let's face it - from the war in Iraq, to Enron, to the latest collapse and bailout of Freddie, Fannie, AIG, Merrill & Lehman WE the people of America are shouldering the burden created by the greedy, sleazy GOP elite. McCain is doing a very interesting/convoluted dance in an attempt to distance himself from his party but the bottom line is that he voted in lockstep with the GOP to get rid of the checks and balances that existed between the market, insurance and banking industries. The Dems in Congress that did attempt to stop this deregulation were outvoted by the GOP majority. Given that McCain has surrounded himself with all of Bush's people - to write his speeches, to handle his campaign, to head up his interim team (should there be a need for one), I can't see how people would vote for him if they really and truly want change. And as far as Bush's legacy goes - well his presidency will go down as an utter failure, just like all the other business ventures he's run into the ground over his lifetime. The ultimate joke though is on us because while we the taxpayers must bear the burden of bailing out these industries Bush and his cronies will float off into the sunset with their golden parachutes paid for by us.

There's no shortage of sociopaths running rampant in Washington DC. Incidentally, McCain just picked Timmons to head up his interim team if he gets elected - Timmons is the chief lobbyist for the petroleum industry. Change my ass! It's just a low budget remake of the Bush/Cheney years.

Here's from today's Progress Report:

The McCain Economic Council

This weekend, the U.S. financial system faced what the Washington Post called its "gravest crisis in modern times." The securities firm Lehman Brothers filed for bankruptcy, "becoming the largest financial firm to fail in the global credit crisis." At the same time, "the credit crisis claimed another of America’s oldest financial companies," as Merrill Lynch sold itself to Bank of America for $50 billion. The insurance giant AIG, meanwhile, "made an unprecedented approach to the Federal Reserve seeking short-term financing," and had its credit rating downgraded, leading to "urgent talks to put together a $75 billion line of credit." On the same day that news of this financial turmoil broke, Sen. John McCain (R-AZ) argued that "the fundamentals of the economy are strong." Looking at the members of McCain's "economic council those who advise the campaign on economic issues -- it becomes clear why he is so divorced from the bad economy. Some of his economic advisers helped create the housing crisis, some abused corporate loopholes to hide billions in corporate profits, and some simply refuse to admit that there is anything seriously wrong with the economy. A look at some of McCain's economic gurus:

THE 'ECON BRAIN,' PHIL GRAMM: Former senator Phil Gramm is known as McCain's "Econ Brain." Recently, he has called America "a nation of whiners" who are in a "mental recession." While in the Senate, he was behind the Commodity Futures Modernization Act and the Gramm-Leach-Bliley Act. The former made legal "the mortgage swaps distancing the originator of the loan from the ultimate collector," while the latter "destroyed the Depression-era barrier to the merger of stockbrokers, banks and insurance companies." As The Nation wrote, "those two acts effectively ended significant regulation of the financial community." After leaving Congress, Gramm worked for the Swiss bank UBS. Politico reported that while at UBS, "Gramm lobbied Congress, the Federal Reserve and the Treasury Department about banking and mortgage issues in 2005 and 2006. During those years, the mortgage industry pressed Congress to roll back strong state rules that sought to stem the rise of predatory tactics used by lenders and brokers to place homeowners in high-cost mortgages." McCain has also voted against discouraging predatory lending practices.

THE OUTSOURCER, CARLY FIORINA: As CEO of Hewlett-Packard (HP), Fiorina exploited a corporate loophole to hold more than $14 billion in profits overseas, a loophole that McCain is against closing. She was forced out of HP after a merger with Compaq failed to bring Hewlett the profits that Ms. Fiorina had forecast," resulting in tumbling shares. She is also a defender of outsourcing, which she calls "right-shoring," and has said that "there is no job that is America's God-given right anymore." "It's hard on people, but I don't understand how you pick and choose among the jobs you want to save and protect against and not expect people to do the same to you," she said. While McCain has recently condemned "golden parachutes" -- excessive compensation for exiting CEOs – by saying, "CEOs that led us into this mess are walking away with over $20 million, and we're not going to let that happen as president…They deserve nothing," Fiorina walked away from HP with a $21 million severance package, which, with another $21 million in options, brought her $42 million. In a 2007 interview with Fortune, Fiorina said that “what we ought not to do is regulate or legislate CEO compensation."

THE CHIEF LOBBYIST, RICK DAVIS: After the bailout of Fannie Mae and Freddie Mac, McCain and his running mate, Gov. Sarah Palin (R-AK), published an op-ed in the Wall Street Journal that called lobbyists "primary contributors" to the crisis. One of these lobbyists though, is McCain's own campaign manager, Rick Davis, who " served as president of an advocacy group led by Fannie Mae and Freddie Mac that defended the two companies against increased regulation." Davis challenged even the smallest reform measures intended to make sure that Fannie Mae and Freddie Mac were being held more accountable for their actions. This helped the mortgage giants, "consistently [beat] back congressional efforts to increase oversight, even after a major accounting scandal in 2003 resulted in a $400 million fine for Fannie.

THE IDEOLOGUE, DONALD LUSKIN: Like McCain, Luskin believes that "things today just aren't that bad," and everyone should "quit doling out that bad-economy line." In a Washington Post op-ed last Sunday, he wrote that "we have surely become a nation of exaggerators" regarding the economy, despite agreeing that "the foreclosure rate is the worst since the Great Depression." Luskin claimed that "unemployment is up a bit," when it is at a five-year high of 6.1 percent. He also asserted that the housing crisis is "over." As evidence of the economy's strength, he pointed to last quarter's GDP growth of 3.3 percent, yet "somehow fail[ed] to mention that the quarter before, it was 0.9%, and the quarter before that, -0.2%." Luskin also failed to note that one of the primary reasons for the growth was the "$90 billion in economic stimulus payments that reached taxpayers during the quarter."