rssHoyer On TARP Reform: Obama Admin ‘Very Likely to Indicate that It Intends to Follow the Provisions Relatively Closely’
Wednesday, January 14, 2009 at 6:47 pm
- 3 Comments
For those already critical of congressional Democrats for not doing enough to ensure that the incoming Obama administration spends the second $350 billion of the Wall Street bailout as lawmakers intended, the words of House Majority Leader Steny Hoyer (D-Md.) today probably won’t be very reassuring.
Referring to a House proposal — sponsored by Rep. Barney Frank (D-Mass.) — that would attach strict guidelines to the Treasury Department’s spending under the Troubled Assets Relief Program (TARP), Hoyer reiterated what some of his colleagues have said in recent days: The proposal is good but unnecessary; we trust the Obama team to spend the cash wisely. From the transcript:
I think we will pass it in the House. But if the Senate for some reason doesn’t pass it, it is my understanding that Mr. Frank has been in extensive discussions with the Obama transition team. And the Obama transition team has been involved in the provisions in this oversight bill, the TARP oversight bill. And it is my belief that in the event it doesn’t pass, that the administration is very likely to indicate that it intends to follow the provisions relatively closely. I don’t mean that they have absolutely agreed on it.
Meet the new congressional oversight.
3 Comments
Comment posted January 14, 2009 @ 6:11 pm
It is a shame that we are skirting the real issue of our time. How do we get out of this economic quagmire? It seems that we are spending Billions in the hope that these monies will solve the problem. The real problem is the “lack of confidence” by the Borrower in his/her ability to make payments on loans and mortgages, and the “lack of confidence” by the Lender in believing that the Borrower will do so.
I BELIEVE THAT THERE IS A SOLUTION. The key is the Borrower’s ability to make the monthly mortgage payments on the Subprime and “Toxic” mortgages that will be Resetting in 2009 as part of the 2nd “Tsunami” Wave of Foreclosures.
If we can “naturally” guide the Borrower to avoid default, we will “turn it all around”. Everyone expects that the Borrower will default and be foreclosed. However, once the markets see that the mortgages are not defaulting, a few wonderful things will happen. First, the media will report that the rate of foreclosure is dropping. Second, the consumer will have more confidence in his/her ability to handle his/her finances. Third, the valuation of the Mortgage Backed Securities will “rise from the ashes”, and all of the previously downvalued securities, whose underlying assets were these “Toxic” mortgages, will encourage investors to come back into the market.
In fact, the biggest winner will be the US Gov’t who has the greatest stake in the valuation of these “Toxic” mortgages.
In conclusion, the key is the Borrower… The Solution is a program of “Immediate and Specific Financial Guidance” for the Borrower to make this all happen.
Samuel D. Bornstein
Professor of Accounting & Taxation
Kean University, School of Business, Union, NJ
Tel: (732) 493 – 4799
Email: bornsteinsong@aol.com
Comment posted January 15, 2009 @ 2:11 am
It is a shame that we are skirting the real issue of our time. How do we get out of this economic quagmire? It seems that we are spending Billions in the hope that these monies will solve the problem. The real problem is the “lack of confidence” by the Borrower in his/her ability to make payments on loans and mortgages, and the “lack of confidence” by the Lender in believing that the Borrower will do so.
I BELIEVE THAT THERE IS A SOLUTION. The key is the Borrower’s ability to make the monthly mortgage payments on the Subprime and “Toxic” mortgages that will be Resetting in 2009 as part of the 2nd “Tsunami” Wave of Foreclosures.
If we can “naturally” guide the Borrower to avoid default, we will “turn it all around”. Everyone expects that the Borrower will default and be foreclosed. However, once the markets see that the mortgages are not defaulting, a few wonderful things will happen. First, the media will report that the rate of foreclosure is dropping. Second, the consumer will have more confidence in his/her ability to handle his/her finances. Third, the valuation of the Mortgage Backed Securities will “rise from the ashes”, and all of the previously downvalued securities, whose underlying assets were these “Toxic” mortgages, will encourage investors to come back into the market.
In fact, the biggest winner will be the US Gov’t who has the greatest stake in the valuation of these “Toxic” mortgages.
In conclusion, the key is the Borrower… The Solution is a program of “Immediate and Specific Financial Guidance” for the Borrower to make this all happen.
Samuel D. Bornstein
Professor of Accounting & Taxation
Kean University, School of Business, Union, NJ
Tel: (732) 493 – 4799
Email: bornsteinsong@aol.com
Pingback posted January 15, 2009 @ 7:57 am
[...] Hoyer On TARP Reform: Obama Admin ‘Very Likely to Indicate that It Intends to Follow the Provision… at washingtonindependent.com by Mike Lillis. [...]
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