20th January, 2017

[Craig Lamson]

My feeling and a lot of friends here in Washington who are also politically astute do not believe Trump will serve out his first term.  Unless he does something more than he has about his business interests he may get caught up in an ethics issue that he cannot get out of.  There is increasing pressure on him to release his tax returns (437K have signed a petition on the White House website requesting that he release his tax returns.  The petition is active for 30 days after which the White House is supposed to respond providing a 100K threshold has been met.  this shows that his statement that "only the press cares about my tax returns" is false).  We don't know what his tax returns contain but there could be some embarrassing information about loans from foreign banks.  His family is being savaged on social media.  Perhaps that doesn't matter to him but I wonder what the family members feel.

There are a fair number of Republicans who are tired of all the antics and they may also put pressure on him.  I'm skeptical that he will be impeached but some experts believe that's possible.  Anyway, him running for a third term is as close to zero possibility as there is in the world.

There is no law or requirement that Trump must post his tax returns.  It is totally up to him.  Lets get real.  A "fair number of Rebublicans" were tired of him before the primary was over.  He has been pressured fron day one and I don't think he will buckle.  He is not working for the political class, or those who have made Washington their life. He is working for people like me.

[Farmer]

He is working for himself.

[Robert Roaldi]

Interesting podcast featuring a couple of legal experts from past administrations: http://www.npr.org/2017/01/19/510574687/ethics-lawyers-call-trumps-business-conflicts-nakedly-unconstitutional

[Craig Lamson]

He is working for himself.

Exactly what does he have to gain? 

[Robert Roaldi]

There is no law or requirement that Trump must post his tax returns.  It is totally up to him.  ...

I am not american so have no oar in this lake, but do you think that this makes it ok then?

[scyth]

Interesting podcast featuring a couple of legal experts from past administrations: http://www.npr.org/2017/01/19/510574687/ethics-lawyers-call-trumps-business-conflicts-nakedly-unconstitutional

some legal experts from some past administration were also clearing waterboarding, etc

those "experts" are always in smb's pocket.

[Craig Lamson]

I am not american so have no oar in this lake, but do you think that this makes it ok then?

Yes.  Tax returns are personal information.  If one chooses to make them public, good for them.  If one declines also good for them.  In the end the people have spoken and elected Trump without needing to see his tax returns.  Game over.

[Bart_van_der_Wolf]

Exactly what does he have to gain?

Seriously, you don't know?

Cheers,
Bart

[Craig Lamson]

Seriously, you don't know?

Cheers,
Bart

Tell us....

[scyth]

Tell us....

certainly not the shnobel prize... Obama & Walesa are enough 

[Alan Goldhammer]

We can trade quotes forever Alan.  I can muster just as many to support my positon as you can to support yours. 

You opening position on this is was:  "Other than Peter Wallinson at AEI who is delusional on this point, numerous experts on the housing industry have totally debunked this viewpoint."

Well, its not totally debunked at all.  Opinions differ.  No one it taking the banks off the hook.  Rather some are pointing out that abused governmental policy and the law of unintended consequence had a big part to play. It does not suprise me at all to see liberals and big government types looking to absolve the goverenment of blame.

It's not quotes Craig.  Virtually all housing economists have demonstrated that the CRA was not responsible for the financial meltdown.  This is not an issue of liberal v conservative but one of facts regarding who was doing the mortgage underwriting.  The bad mortgages were coming from Countrywide, Wachovia, Washington Mutual and IndyMac  They were abetted by the companies that were packaging these bonds and the ratings agencies that were giving them AAA ratings despite having no clue that that many of the tranches that made up the securities were poisoned fruit.  Furthermore there were fools such as Lehman and AIG that were writing insurance policies on these bonds thinking that they would never default.  But default they did and the whole house of cards came tumbling down.  All of these were corporations in the private sector and I fail to see how 'Big Government' was involved in a private sector collapse.  Now maybe we should have let nature take its course and not have done anything back in 2008 and see what would have happened.  We could have let GM and Chrysler fail and not have bailed out AIG or forced some of the bank mergers that took place after the failure of Lehman.  Now perhaps you would have wanted to see this happen as a test case that markets correct themselves.  Had that come to pass you would be living in a completely different world today.

You can continue to cling to the fantasy that the CRA and your other 'alternate facts.'  I'm pretty damn happy that the government stepped in but saddened that they didn't do a larger stimulus to get the country righted faster than it has.

[Craig Lamson]

It's not quotes Craig.  Virtually all housing economists have demonstrated that the CRA was not responsible for the financial meltdown.  This is not an issue of liberal v conservative but one of facts regarding who was doing the mortgage underwriting.  The bad mortgages were coming from Countrywide, Wachovia, Washington Mutual and IndyMac  They were abetted by the companies that were packaging these bonds and the ratings agencies that were giving them AAA ratings despite having no clue that that many of the tranches that made up the securities were poisoned fruit.  Furthermore there were fools such as Lehman and AIG that were writing insurance policies on these bonds thinking that they would never default.  But default they did and the whole house of cards came tumbling down.  All of these were corporations in the private sector and I fail to see how 'Big Government' was involved in a private sector collapse.  Now maybe we should have let nature take its course and not have done anything back in 2008 and see what would have happened.  We could have let GM and Chrysler fail and not have bailed out AIG or forced some of the bank mergers that took place after the failure of Lehman.  Now perhaps you would have wanted to see this happen as a test case that markets correct themselves.  Had that come to pass you would be living in a completely different world today.

You can continue to cling to the fantasy that the CRA and your other 'alternate facts.'  I'm pretty damn happy that the government stepped in but saddened that they didn't do a larger stimulus to get the country righted faster than it has.

It's not a fantasy Alan, it's fact.  The CRA set the stage, weakened underwriting and then fanny and Freddy showed the banks how to repackage.  This is undeniable whether you want to accept it or not.

Like i said, no one is giving the banks a pass. But it's time to be honest where this started.  Your statement " I fail to see how big government was involved" pretty much says it all.  This discussion has run its course.

[Alan Goldhammer]

It's not a fantasy Alan, it's fact.  The CRA set the stage, weakened underwriting and then fanny and Freddy showed the banks how to repackage.  This is undeniable whether you want to accept it or not.

Like i said, no one is giving the banks a pass. But it's time to be honest where this started.  Your statement " I fail to see how big government was involved" pretty much says it all.  This discussion has run its course.

Enjoy your 'alternate facts' universe.

[Craig Lamson]

Enjoy your 'alternate facts' universe.

Enjoy your "big government is right" universe. 

[JoeKitchen]

I really think big government supporters fail to see the fact that the government initiated the cause for the recession, or at least created an environment that allowed it flourish.  Of course Kurgman and his cohorts are never going to come out and say this, but they are big government guys and never blame anyone but big business.  It's never the governments fault. 

The government, through their policies, produced an environment of lax banking checks.  The government is not directly responsible for the greed that took place at the banks and the financial stupidity of those too naive or lazy to understand a mortgage agreement (and I put both banks and those who borrowed equally at fault), but they sure encouraged it.  Through Franny and Freddy, they supported an environment that pushed off the crash much further then it should have, and both Clinton and Bush felt every American should own a home regardless of the cost. 

Same thing happened in the 1920s.  It was obvious to those paying attention the stock market was inflated in the early 20s, but the Fed decided to cut interest rates and increase money supply to spur off a recession, hoping that the economy would just flat line for a while.  Unfortunately, and unforeseen to them, this only made it easier to borrow money, which then went to stock market and derivative betting, and made the problem worse.  The greed that lead to the depression was not the governments fault, but the environment they created allowed it flourish.  If you took away the easy money from the Fed in the early 20s, the crash would have happened sooner.  Milton Friedman spoke and wrote on this many times. 

I think one of the reasons why so many big government economist ignore this is because they believe a complicated economy can be controlled.  It is an insult to their intelligence that it can not, and their arrogance prevents them from accepting the fact that they can not control it.  Unfortunately for us who actually make this economy go round and don't have cushy University jobs to fall back on, the law of (their) unintended consequences has an adverse effect on us. 

[JoeKitchen]

Same thing use to happen in the ASMP, my professional organization.  Prior to a few years ago, anyone involved in the photography world could get on the board and issue suggestions and what not.  Some of the recommendations on how to operate business were off the charts crazy, but those making the suggestions were photography professors, not professionals, or at the very least did not have to worry about making a profit due to other reasons (rich spouse, etc.). 

They had no real experience making it as a pro, and never felt the fire under their ass to get out there, find clients, negotiate contracts and perform. 

Thankfully it was put in place that you needed to make over 50% of your income directly from image making and they slowly phased out of leadership positions. 

I give the same creditability, which is zero, to any college professor that has never had a leadership role in a successful business who gives business advice.  They have no practical knowledge, no real experiences, only theoretical ones, and that does not cut.  Like the man who questioned Sander's a week ago said, "you've never lived until you put payroll on your personal credit card." 

[Farmer]

Exactly what does he have to gain?

The only thing that matters to Trump - making himself feel like he's winning, that he's better than everyone else, that he's the greatest.  That's his entire business and personal life wrapped up - narcissist.

There's nothing specifically wrong with that, right up until the point where he does something that hurts others.

[Craig Lamson]

The only thing that matters to Trump - making himself feel like he's winning, that he's better than everyone else, that he's the greatest.  That's his entire business and personal life wrapped up - narcissist.

There's nothing specifically wrong with that, right up until the point where he does something that hurts others.

I think it goes beyond that, at least in this case.  But that's just my personal opinion. 

[Alan Goldhammer]

I really think big government supporters fail to see the fact that the government initiated the cause for the recession, or at least created an environment that allowed it flourish.  Of course Kurgman and his cohorts are never going to come out and say this, but they are big government guys and never blame anyone but big business.  It's never the governments fault and never is it possible for an entire group of people to develop a mindset that would have a negative reaction on them.  (But of course, they always praise a group of people that develop a mindset that produces a positive reaction, funny how it never works the other way.) 

The government, through their policies, produced an environment of lax banking checks.  The government is not directly responsible for the greed that took place at the banks and the financial stupidity of those too naive or lazy to understand a mortgage agreement (and I put both banks and those who borrowed equally at fault), but they sure encouraged it.  Through Franny and Freddy, they supported an environment that pushed off the crash much further then it should have, and both Clinton and Bush felt every American should own a home regardless of the cost. 

Same thing happened in the 1920s.  It was obvious to those paying attention the stock market was inflated in the early 20s, but the Fed decided to cut interest rates and increase money supply to spur off a recession, hoping that the economy would just flat line for a while.  Unfortunately, and unforeseen to them, this only made it easier to borrow money, which then went to stock market and derivative betting, and made the problem worse.  The greed that lead to the depression was not the governments fault, but the environment they created allowed it flourish.  If you took away the easy money from the Fed in the early 20s, the crash would have happened sooner.  Milton Friedman spoke and wrote on this many times. 

I think one of the reasons why so many big government economist ignore this is because they believe a complicated economy can be controlled.  It is an insult to their intelligence that it can not, and their arrogance prevents them from accepting the fact that they can not control it.  Unfortunately for us who actually make this economy go round and don't have cushy University jobs to fall back on, the law of (their) unintended consequences has an adverse effect on us.

I'll try to make this simple if this is at all possible.  There were a number of economists who called the housing bubble as early as 2004.  A couple of these were academic economists such as Robert Shiller who has published extensively on housing prices and is co-developer of the Case-Shiller housing index that is used by many to track housing prices.  Others including Dean Baker and Bill McBride are independent economists and can in no way be called 'big government economists'.  It is most instructive to read Bill McBride's Calculated Risk historical blog posts(I do so every day as it is a valuable synthesis of all types of economic data).  He had a collaborator, Tanta (aka Doris Dungey), who was an experienced mortgage underwriter whose life was taken way too early.  She had expertise in the area and her collective posts covered a lot of what was wrong in that industry.  Bill McBride's singular post summing up the subprime debacle is here: http://www.calculatedriskblog.com/2010/12/commentary-subprime-thinking.html 

There is a huge amount of source material out there and I follow most of it for investment purposes as I am in the "trust but verify" school of investing.  I take issue with a lot of what you have stated but if you point to any original source material that back up those contentions I will gladly revisit things.  The blunt fact is that the CRA had nothing to do with the meltdown.  Mortgage underwriting standards are not controlled by the government.  NINJA (No Income No Job no Assets) loans were made by the private sector.  The quasi-government entities Fannie and Freddie have standards regarding what kind of mortgages they will purchase from lenders and then seculritize.  The real toxic mortgages were not purchased by those two but rather repackaged by others into the complicated bonds that were given AAA ratings despite the ratings agencies not knowing what was in them.  No government role here as it was all the glorious private sector. 

You guys have worn me out on this.  I'll let this be the final post on the matter.  If anyone is interest, I can provide a lot of resources (send me a PM)  For those who want to live in their alternate fact universe that's fine too.  I've got better things to do in looking after my investment portfolio than in trying to educate those who don't want to be educated.

[Alan Goldhammer]

The only thing that matters to Trump - making himself feel like he's winning, that he's better than everyone else, that he's the greatest.  That's his entire business and personal life wrapped up - narcissist.

There's nothing specifically wrong with that, right up until the point where he does something that hurts others.

Phil, I agree but it's leading to some pretty delusional behavior.  He's also surrounding himself with an inner circle that is only reinforcing his behavior.  The bigger question is whether any of the Republicans in Congress will stand up to him.  take the tax return issue; he said the only ones who cared about those were the press (of course they have good reason to).  However, the petition page on the WhiteHouse.gov website now has 460,000 signatures (https://petitions.whitehouse.gov/petition/immediately-release-donald-trumps-full-tax-returns-all-information-needed-verify-emoluments-clause-compliance )  Once the thirty days are up the White House is supposed to respond to the petition.  We'll see if that happens.

There are a lot of us who think we live in a very dark time right now which is why the demonstrations have been so large.  I certainly cannot remember any point in my life that I felt our government sitting on a fragile edge.