Hi readers. I’ll be on the Amazon River in Peru and the Galapagos Islands off Ecuador thru the first week of August. So if you don’t see any new posts for a couple weeks, you know why!
A guest perspective……..
BY JOHN WINKLER
It’s fun to watch Obamaniacs’ disillusion over Their Chosen One’s changes of position. They seem to view his modifications as a form of treason but it’s really been quite clear that what the man is is a very good politician. He seems to have always understood that the way to power was the path of the empty vessel—allowing himself to be filled by his fans with whatever they needed to see in a national leader. And so he was painted as a change agent, a new kind of politician. And much of this has come from a national perspective. But in Illinois the view has been just a little bit different.
Like the rest of the real estate universe, the Mortgage Bankers Association is in trouble. Membership is in decline, meeting attendance is down and some of MBA’s largest conference sponsors are either out of business or cutting back. With this in mind, it seems a poorly-timed decision to double-down on real estate. But that’s precisely what CEO Jonathan Kempner did, using MBA’s reserve fund to construct brand new headquarters.
Freddie Mac’s PR people are fighting back, even as Hank Paulson is floating a bailout plan that would make explicit the implicit taxpayer guarantee backing their debt. Yesterday the company began purchasing keyword-targeted online ads from Google. “Keyword-targeted” ads are pretty simple to understand. Websites that take advertising from Google install Google’s code on their page. Google’s computers read the content of the page, finding key words, and then serve ads by advertisers who wish their pitch to be seen next to those words.
First reported on the Implode-o-Meter yesterday, IndyMac bank’s $32 billion in assets have been taken over by the FDIC. This is the largest bank failure since the $40 billion bailout of Continental Illinois in 1984. Federal authorities estimate the bailout will cost taxpayers $4-$8 billion. (And that may be a fraction of what this down cycle costs the FDIC and, possibly, taxpayers).
New York Senator Chuck Schumer caught some flack last week for leaking his concerns about IndyMac to the press. Perhaps imprudent, but probably prescient. The FDIC is certainly looking very closely at the bank’s books after a mini bank-run last week. [Update: IndyMac announcing that certain operations will shut down in e-mail to employees.]
If skyrocketing food and oil prices point to inflation on the rise, then why has the Fed risked even more inflation by lowering interest rates so much since last Fall? That’s a popular question these days. And one that’s hard to answer without knowing how the Fed works.