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Thursday, October 09, 2008

That damned Monster

What's Mallard raving about today?

Monsters, Freddie Mac, Fannie Mae.

Bad poetry, Republican talking points, no sense.

It's Mallard Fillmore!

The Party of Personal Responsibility's explanation for the roots cause of a crisis which developed while it was in power of every branch of Government: It was someone else's fault.

Mallard can blame the Community Reinvestment Act all he wants, but as far as I understand the system of American Government, the Republicans could have repealed the Act, just like they did Habeus Corpus.

On November 4, we're going to force them own their failure, even if they don't have the courage to own up to their responsibility.


GeoX said...

Good god--are we really in for three weeks of Halloween limericks that don't scan? A horrifying thought.

Anonymous said...

Dear Mr. Tinsley. The Vogons called, they've selected you Poet Laureate. Earth thanks you for your services, and wishes you good luck in your new life on Vogsphere. Don't come back, don't send any postcards, just leave. Now.

Duck Hunter said...

Mallard Presents: A Poem for his Creator…

There once was a creature named Bruce
Whose commitment to honesty was loose.
He knew just one game…
On the LIBERALS pin blame!
That’s how a duck cooks his own goose.

David B said...

I remember back in high school learning the difference between traditional verse (following restrictions of rhyme and meter), blank verse (restricted for meter, but not rhyme), and free verse (restricted in neither rhyme nor meter).

As i recall, you can have free verse with rhyme, but it's a patternless rhyme, and it doesn't have an easy-to-remember name. I vote that we name this sort of poetry--following a rhyme scheme but freed of those nagging necessities of meter--"fillmore verse", not just in honor of the name of its poet laureate Bruce Tinsley's comic strip, but also in honor of the fact that it allows Tinsley to fill more of the strip with words rather than his horrible, horrible drawings.

Kaitlyn said...

Let me be all touchy-feely liberal and say something nice about today's comic.

That is a great costume - I've never seen one with such realistic (for the MF universe) eyes!

Or he didn't bother to draw a costume.

And that's a pantless kid. Great.

As for the talking points: of course it's Fannie and Freddie that are to blame, they're the ENTIRE reason we're in trouble now, nobody else would have declared bankruptcy without their existence.

Since it's their fault, and they're liberal, that explains why it happened so far down the line - out to smear conservatives.

exanonymous said...

Hmm... if it's a "cheap costume idea", then the costume indicated should be cheap. But as any wookie-wannabe can tell you, fake hair is not cheap.

As for the Fannie and Freddie and CRA, it should be noted that it was created decades ago.

Not only has one republican administration gone by with this, but several, including the popular Reagan.

Anonymous said...

This line about the sub-prime collapse (soon to be the prime, Alt-A, and everything else collapse) being the fault of the CRA or Fannie/Freedie is *really* starting to piss me off.

Hey, Mallard, the banks did not push negative amortization loans onto my white, middle-age mother because of the CAR. They did it because it was *enormously profitable* to sell mortgage-backed debts to investors, which meant they needed to get as much mortgage debt on their books as possible.

Oh, and Fannie and Freddie? You know they didn't even touch mortgages over $417K, right? So if rampant government intervention was the problem, all those pure free-market jumbo-sized loans wouldn't be defaulting right now, would they?

rewinn said...

"Fillmore verse - I love it!
It's neat, sweet and complete!

Michael said...

Oh god. This poem is so bad.

Toward whom is Mallard extending his middle finger, besides the English language?

factinista said...

Toward whom is Mallard extending his middle finger, besides the English language?

Liberals, naturally.

My goodness, this is stupid on so many levels. How do you dress up as a mortgage company anyway? This has to be the most awkward shoehorning I've ever seen Mallard use.

Gold-Digging Nanny said...

Cheap Halloween costume idea #4: Tape some feathers to your forehead. Fashion a beak out of construction paper and an elastic cord. Wear a rumpled suit coat and tie, but no pants. Cut a word balloon out of construction paper and fill it with rabid conservative dogma; position it so it's coming out of your ass.

Gold-Digging Nanny said...

The stupid ... it burns....

I came to this site to take a break from watching a debate between three Senate candidates in my state (it was held last night in another part of the state, but now it's on the Web; I'm going to write a blog post about it for our local alt weekly). One of the candidates, an independent who's very Libertarian in tone, was asked the cause of the economic meltdown and how he would fix it. He said it was caused by overregulation. And he gave this same bullshit argument about the CRA.

I'm going to concede that CRA is probably a factor in some failed mortgages, but probably not near as much as real estate speculators. And even the problems caused by real estate speculators would probably have blown over fairly quickly were it not for several issues exacerbating everything:

1) Unregulated home appraisers. People are upside down on their mortgages now. Conventional wisdom has it that they lost value. Partly true, but not entirely. Unless it's been extremely poorly maintained, the house itself has the same amount of inherent value it ever did. Kind of like a loaf of bread -- the price may go up over time, or even down (maybe if there's a surplus of wheat and reduced demand due to, say, the entire nation going on Atkins), but it still has the same inherent value because you can still make the same amount of sandwiches from it. What happened was, the house was overvalued by an appraiser who wasn't doing his job and the buyer paid more for it than they should have. Now they can't refinance because they're upside down, because they're in debt for more than the house is worth. Now, there were a lot of competent, honest appraisers out there, but under our current system, the appraiser is usually chosen by the realtor, whose commission is a percentage of the price of the home. So a realtor is always going to steer business to someone who will appraise a home at an inflated value, and experienced realtors can always find out who that is quickly enough.
2) Unregulated mortgage products. As anonymous so eloquently pointed out, lenders created ridiculous products like ARMs and balloon mortgages, not because CRA forced them to, but because it was enormously profitable for them to do so. They saddle someone with a mortgage they can't afford, they get their commission and then they bundle the mortgage up with tons of other bad mortgages into a mortgage-backed security and sell it off to investors, particularly foreign investors, who were flush with capital and eager to invest in something. ARMs weren't created to comply with federal mandates. They were created because all the lenders wanted a piece of the action. This is described beautifully in This American Life's Giant Pool of Money episode.
3) Unregulated credit rating agencies. Those mortgage-backed securities would never have flown without these guys. They take a bundle of mortgages that individually were quite obviously speculative and deserving of a very low rating, and give the entire bundle of them a very high rating. Sure, these rating agencies had their (flawed) logic behind why these mortgage-backed securities were safer than the individual mortgages that composed them, but really what it comes down to is that, just like with realtors and appraisers, the credit rating agencies are chosen and paid by the investment bank that wants to bundle and sell the mortgages. And if one credit rating agency won't give them the AAA rating they want, they'll find one who will. Now, some members of Congress saw this as a problem, and they asked either Paulson or Cox, I don't remember which, if he would like the authority to regulate these credit rating agencies. He said no. So investors in these mortgage-backed securities bought these with the belief that they were solid investments, and if these mortgages were allowed to fail and Fannie and Freddie and all the investment banks were allowed to fail, they stood to lose a lot of money. But some of those investors included foreign governments. Fannie and Freddie became a foreign relations issue. And that's why the government stepped in to prop them up.
4) Unregulated credit default swaps. When it became obvious how toxic these mortgages were, some banks ended up with a lot of them on their hands, whether they were a mortgage lender or a big investment bank who bought them from the mortgage lenders to turn around and sell them again. Prime example: Lehman Bros. Credit default swaps were created to be sort of an insurance policy for a bond, to make it even safer; it guaranteed your money back in the event the company your bond is with goes bankrupt. And because it was unregulated, people could sell these policies even if they didn't have the funds to back them up, and they could buy it even if they didn't have a bond to insure and they just wanted to bet that a company would fail. A few years ago, selling credit default swap protection for Lehman seemed like a really good idea even if you didn't have the funds to back it up, because what could have been safer than Lehman Bros.? Flash forward to a few weeks or months ago, and it's becoming more and more obvious that Lehman has a really good chance of failing. And if you've got a credit default swap contract, you can sell it to AIG at a profit, and AIG can sell it at a profit to someone at another financial institution who thinks Lehman's going to fail (AIG did a lot of this). Flash forward again to the day Lehman goes under. The company that issued the credit default swap can't pay. So the guy that sold it to AIG can't pay. So AIG can't pay the person it sold it to. And that's how Lehman's failure nearly brought down AIG and the entire financial system. (Explained really well in This American Life's Another Frightening Show About the Economy episode.)

So yeah, let's get the government out of the free market with this Community Reinvestment Act business. 'Cause that'll solve everything.


rewinn said...

Gold-Digging Nanny: thanks for the "Giant Pool of Money" link - I'd heard the program but the reminder is awesome.

Everyone else: if you haven't heard "Giant Pool of Money", do so now! It's the best, factual explanation you're going to get ... or if you're a reader, here's the official transcript in a pdf.

Somehow I doubt Tinny will read it - it's all facty and stuff.