Okay, look… before I say another word, I want everyone to know that I did not want to do this. I put it off all year, and I take no pleasure in doing it even now. But someone has to say something, and it might as well be me.
The simple fact is that our president was a tremendous disappointment to me last year, and although I tried my best to put someone else into this slot, I just could not convince myself to do so. What the hell is going on in the mind of The White House?
I know this is a magazine that people in finance and banking read. And I know that finance and banking types want to believe our economy has turned some sort of corner, but please… no one seriously believes that, do they? What corner? The stock market is up, I suppose, but as to why, no one really knows. Unemployment is as bleak as ever. And foreclosures… well, don’t even get me started. What’s better, exactly? (Write to me, I want to know.)
When Barack Obama gave his speech introducing the Making Home Affordable program on February 18, 2009, he said his plan would save 7-9 million homes… then it was 4-5 million homes… now it’s… well… maybe it won’t save any homes. As 2009 came to a close, the HAMP program had something close to 700,000 trial modifications and roughly 30,000 permanent modifications. The program’s only claim to fame is that it did better than Bush’s Hope-4-Homeowners program that accomplished essentially nothing.
Banks and mortgage servicers made the news almost every day from the summer of ’09 forward, for absolutely screwing around homeowners in the worst ways, but all President Obama did was call the bankers to Washington D.C. for yet another talking to… and the CEOs of three of the largest banks didn’t even show up. They said they were stuck in New York due to fog, which I suppose is better than them saying it was rain… or cold weather, but still. It’s the President of the United States, and New York is simply not that far by train, for heaven’s sake.
The CEOs that didn’t make it were from Goldman Sachs, Morgan Stanley and Citibank… and we absolutely own Citibank, wouldn’t you say? I know, Secretary Geithner was uber-clever making the cash we gave them come out to us owning 36%, of whatever he said, but the guy running Citi should have walked to The White House if the president asked him to be there. Goldman Sacks CEO… Lord Blankcheck didn’t make it, but I understood that. He outranks the president, and besides… Geithner spends so much time on the phone with him that I believe we’re funding part of the health care bill by turning the call from Treasury to Wall St. into a ‘900’ number. Plus, Lord Blankencheck was busy doing “God’s Work,” which is apparently a euphemism for handing out $16.7 billion in unearned bonus checks… I mean stock options.
And speaking of outrageous bonuses, our man-of-the-people president presided over the banks giving out $91 billion in bonuses this past year. $91 billion. Think about that for a moment. TARP was only $700 billion. That’s like one seventh of TARP… in bonuses! That’s truly stunning. I read that the $91 billion figure represented a 45% increase over last year… last year… when the banks were all very close to bankrupt. I though this guy was a community organizer who didn’t run for president to help a bunch of “fat cats”. What am I missing here? And where were the citizens of this country? We threw a hissy-fit earlier in the year over AIG giving out something like $160 million in bonuses, which is only a little over one percent of $91 billion… and yet I barely heard a peep over the $91 billion figure.
In Barack Obama’s speech introducing Making Home Affrodable, he talked about judges being able to modify mortgages in bankruptcy court, if banks failed to do so, but when it came time to support bankruptcy reform... twice… Barack Obama was nowhere to be found. And we passed a credit card reform bill that put a limit on the fees charged by credit card companies, but we neglected to put a cap on interest rates so we ended up with First Premier Bank offering a card with a 79.9% interest rate. Don’t worry though because it only applies to poor people with bad credit, so I guess it’s not that big a deal.
There is no real estate market, so why is everybody pretending that there is? Giving people the down payment, and making it easy to get loans that will all soon be underwater does not a real estate market make. And commercial property? Down by 40% and pretty much a complete disaster. Of course, Geithner doesn’t require losses on commercial property to be recognized by banks, so I guess problem solved on that front. Morgan Stanley even walked away from at least one of the office buildings that it over-bought a couple of years back. Maybe they were trying to get a loan modification from Goldman Sachs and when it became too frustrating to have Goldman continually lose their file and keep them on hold for hours on end, they just decided to walk away… I mean, “strategically default”.
Guys… we have problems, big problems… problems that President Obama hasn’t even commented on publicly since last February! Not even a comment, Mr. President? What are you thinking? And please don’t say “health care reform,’ because I wouldn’t brag about that.
Still, I heard that President Obama was on Oprah and that when asked to grade his presidency, he gave himself a B+. I don’t know quite what to think about that. If all we can expect is a half grade improvement, I’ll tell you right now… it’s not going to work. We’re going down.