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Interesting articles.The California electricity crisis, also known as the Western U.S. Energy Crisis of 2000 and 2001 was a situation in which California had a shortage of electricity caused by market manipulations and illegal shutdowns of pipelines by Texas energy consortiums. The state suffered from multiple large-scale blackouts, one of the state's largest energy companies collapsed, and the economic fall-out greatly harmed Governor Gray Davis's standing.
Drought and delays in approval of new power plants[4] and market manipulation decreased supply. This caused 800% increase in wholesale prices from April 2000 to December 2000.[5] In addition, rolling blackouts adversely affected many businesses dependent upon a reliable supply of electricity, and inconvenienced a large number of retail consumers.
California had an installed generating capacity of 45GW, but at the time of the blackouts demand was 28GW. A demand supply gap was created by energy companies, mainly Enron, to create an artificial shortage. Energy traders took power plants offline for maintenance in days of peak demand to increase the price.[6][7] Traders were thus able to sell power at premium prices, sometimes up to a factor of 20 times its normal value. Because the state Government had a cap on retail electricity charges, this market manipulation squeezed the industry's revenue margins, causing the bankruptcy of Pacific Gas and Electric Company (PG&E) and near bankruptcy of Southern California Edison in early 2001.[8]
The financial crisis was possible because of partial deregulation legislation instituted in 1996 by Governor Pete Wilson. Enron took advantage of this deregulation and was involved in economic withholding and inflated price bidding in California's spot markets.[9] The crisis cost $40 to $45 billion.
California electricity crisis - Wikipedia, the free encyclopedia
Ken Lay has been dead almost two years and Jeffrey Skilling is several years into his 24 year prison sentence, but one legacy of the Enron era lives on.
It’s the "Enron loophole," which exempts energy speculators who make trades electronically from US regulation. Some argue that the unregulated energy speculation, codified in 2000, can account for $20 to $25 in the jump in oil prices.
But now, 8 years after energy traders were able to push legislation exempting their electronic trades of energy futures from US regulation, a measure in the Farm Bill aims to close the loophole and subject futures trades made electronically inside the United States to US law.
“This bill is really our best bet to deter unscrupulous traders from manipulating energy prices and engaging in excessive speculation. This has been a long, hard road – and this is a major legislative victory," Said California Democrat Sen. Dianne Feinstein after the Senate passed the underlying Farm Bill on a broad, bipartisan basis.
Specifically, according to her office, the bill would "require electronic energy traders to provide an audit trail and record-keeping, monitor for market manipulation, and increase financial penalties for cases of market manipulation and excessive speculation."
Congress Seeks to Close the ‘Enron Loophole’ - ABC News
Here are examples of the kind of unscupulous trading and market manipulation. From evidence made public during the Enron trials :
One trader is heard on tapes obtained by CBS News saying, "Just cut 'em off. They're so f----d. They should just bring back f-----g horses and carriages, f-----g lamps, f-----g kerosene lamps."
and my favourite :
Trader 1: “They’re fucking taking all the money back from you guys? All the money you guys stole from those poor grandmothers in California?”
Trader 2: "Yeah, Grandma Millie man. But she’s the one who couldn’t figure out how to fucking vote on the butterfly ballot."
[Laughing from both sides]
Trader 1: "Yeah, now she wants her fucking money back for all the power you've charged right up, jammed right up her ass for fucking $250 a megawatt hour."
[Harder Laughing]
Enron Tapes Anger Lawmakers - CBS News
Still does not change what I remember about energy futures being a new market. Nor does it change the fact that I remember the problem being with the financial reporting, not the trading itself. Enron created that fake energy crisis to hide their fraud, not to manipulate the market. The strange thing is that some people still think it is the fake crisis that was the problem, not the fraud.
Easy Guide to Understanding ENRON Scandal SummaryBy misrepresenting earnings reports while continuing to enjoy the revenue provided by the investors not privy to the true financial condition of ENRON, the executives of ENRON embezzled funds funneling in from investments while reporting fraudulent earnings to those investors; this not only proliferated more investments from current stockholders, but also attracted new investors desiring the enjoy the apparent financial gains enjoyed by the ENRON corporation.
This is another thing Enron were doing illegally. But they were also manipulating markets and gouging customers due to the deregulation of California's energy markets. It's there in black and white.
Read my link again. Banks traditionally held a lot of their mortgages to maturity. It meant they had skin in the game and wouldn't go hog wild writing bad loans and then dumping them on somebody else, like what happened in the 2000s. When lending standards were relaxed from 2002 onwards the only regulation was the the loans not default for 90 or 180 days.
Banks and mortgage priginators no longer cared whether the loans they were making were safe or not. The mortgagees only had to make their payments for three or six months and then it was somebody else's problem. That's why new mortgage products with cheap teaser monthly rates for the first couple of years of the mortgage were heavily promoted around then. People could buy a two or three hundred thousand dollar home for rent money, and they were told by the mortgage seller "don't worry about the loan rate resetting, just come back to us and refinance the loan!". Except in 2005 or 6 the Fed started to raise rates and it was impossible to refinance the loans. Which led to the string of mortgage defaults which led to the meltdown.
"Read my link again. Banks traditionally held a lot of their mortgages to maturity."
Tradition?
Who cares about tradition?
You claimed Bush eliminated the regulation.
There was no regulation?
Were you lying?
Or were you just stupid?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
Companies exist and are created to make the owners of said company rich. They hire workers and pay them a negotiated wage. You socialists don't like it I know because the lazy butts that are not smart enough to get rich don't get their fair share. Obamaturd is nothing more than a share the wealth socialist, if you agree with him you are an idiot.Since 2009, 88 Percent Of Income Growth Went To Corporate Profits, Just One Percent Went To Wages | ThinkProgress
After the longest recession since WWII, many Americans are still struggling while S&P 500 corporations are sitting on $800 billion in cash and making massive profits. Now, economists from Northeastern University have released a study that finds our sluggish economic recovery has almost solely benefited corporations. According to the study:
Between the second quarter of 2009 and the fourth quarter of 2010, real national income in the U.S. increased by $528 billion. Pre-tax corporate profits by themselves had increased by $464 billion while aggregate real wages and salaries rose by only $7 billion or only .1%. Over this six quarter period, corporate profits captured 88% of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1% of the growth in real national income. The absence of any positive share of national income growth due to wages and salaries received by American workers during the current economic recovery is historically unprecedented.
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"Read my link again. Banks traditionally held a lot of their mortgages to maturity."
Tradition?
Who cares about tradition?
You claimed Bush eliminated the regulation.
There was no regulation?
Were you lying?
Or were you just stupid?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
The Bush administration regulators?
I recall Bush screaming from the rooftops about these problems and Frank, Waters, etc. basically calling him racist.
Gee. If the Feds taxed every penny of this increase in profits generated between Q2-2009 and Q4-2010, that $464B would cover about three months of the Obama Deficits.
Interesting articles.The California electricity crisis, also known as the Western U.S. Energy Crisis of 2000 and 2001 was a situation in which California had a shortage of electricity caused by market manipulations and illegal shutdowns of pipelines by Texas energy consortiums. The state suffered from multiple large-scale blackouts, one of the state's largest energy companies collapsed, and the economic fall-out greatly harmed Governor Gray Davis's standing.
Drought and delays in approval of new power plants[4] and market manipulation decreased supply. This caused 800% increase in wholesale prices from April 2000 to December 2000.[5] In addition, rolling blackouts adversely affected many businesses dependent upon a reliable supply of electricity, and inconvenienced a large number of retail consumers.
California had an installed generating capacity of 45GW, but at the time of the blackouts demand was 28GW. A demand supply gap was created by energy companies, mainly Enron, to create an artificial shortage. Energy traders took power plants offline for maintenance in days of peak demand to increase the price.[6][7] Traders were thus able to sell power at premium prices, sometimes up to a factor of 20 times its normal value. Because the state Government had a cap on retail electricity charges, this market manipulation squeezed the industry's revenue margins, causing the bankruptcy of Pacific Gas and Electric Company (PG&E) and near bankruptcy of Southern California Edison in early 2001.[8]
The financial crisis was possible because of partial deregulation legislation instituted in 1996 by Governor Pete Wilson. Enron took advantage of this deregulation and was involved in economic withholding and inflated price bidding in California's spot markets.[9] The crisis cost $40 to $45 billion.
California electricity crisis - Wikipedia, the free encyclopedia
Ken Lay has been dead almost two years and Jeffrey Skilling is several years into his 24 year prison sentence, but one legacy of the Enron era lives on.
Its the "Enron loophole," which exempts energy speculators who make trades electronically from US regulation. Some argue that the unregulated energy speculation, codified in 2000, can account for $20 to $25 in the jump in oil prices.
But now, 8 years after energy traders were able to push legislation exempting their electronic trades of energy futures from US regulation, a measure in the Farm Bill aims to close the loophole and subject futures trades made electronically inside the United States to US law.
This bill is really our best bet to deter unscrupulous traders from manipulating energy prices and engaging in excessive speculation. This has been a long, hard road and this is a major legislative victory," Said California Democrat Sen. Dianne Feinstein after the Senate passed the underlying Farm Bill on a broad, bipartisan basis.
Specifically, according to her office, the bill would "require electronic energy traders to provide an audit trail and record-keeping, monitor for market manipulation, and increase financial penalties for cases of market manipulation and excessive speculation."
Congress Seeks to Close the Enron Loophole - ABC News
Here are examples of the kind of unscupulous trading and market manipulation. From evidence made public during the Enron trials :
One trader is heard on tapes obtained by CBS News saying, "Just cut 'em off. They're so f----d. They should just bring back f-----g horses and carriages, f-----g lamps, f-----g kerosene lamps."
and my favourite :
Trader 1: Theyre fucking taking all the money back from you guys? All the money you guys stole from those poor grandmothers in California?
Trader 2: "Yeah, Grandma Millie man. But shes the one who couldnt figure out how to fucking vote on the butterfly ballot."
[Laughing from both sides]
Trader 1: "Yeah, now she wants her fucking money back for all the power you've charged right up, jammed right up her ass for fucking $250 a megawatt hour."
[Harder Laughing]
Enron Tapes Anger Lawmakers - CBS News
Still does not change what I remember about energy futures being a new market. Nor does it change the fact that I remember the problem being with the financial reporting, not the trading itself. Enron created that fake energy crisis to hide their fraud, not to manipulate the market. The strange thing is that some people still think it is the fake crisis that was the problem, not the fraud.
By misrepresenting earnings reports while continuing to enjoy the revenue provided by the investors not privy to the true financial condition of ENRON, the executives of ENRON embezzled funds funneling in from investments while reporting fraudulent earnings to those investors; this not only proliferated more investments from current stockholders, but also attracted new investors desiring the enjoy the apparent financial gains enjoyed by the ENRON corporation.
Easy Guide to Understanding ENRON Scandal Summary
This is another thing Enron were doing illegally. But they were also manipulating markets and gouging customers due to the deregulation of California's energy markets. It's there in black and white.
Read my link again. Banks traditionally held a lot of their mortgages to maturity. It meant they had skin in the game and wouldn't go hog wild writing bad loans and then dumping them on somebody else, like what happened in the 2000s. When lending standards were relaxed from 2002 onwards the only regulation was the the loans not default for 90 or 180 days.
Banks and mortgage priginators no longer cared whether the loans they were making were safe or not. The mortgagees only had to make their payments for three or six months and then it was somebody else's problem. That's why new mortgage products with cheap teaser monthly rates for the first couple of years of the mortgage were heavily promoted around then. People could buy a two or three hundred thousand dollar home for rent money, and they were told by the mortgage seller "don't worry about the loan rate resetting, just come back to us and refinance the loan!". Except in 2005 or 6 the Fed started to raise rates and it was impossible to refinance the loans. Which led to the string of mortgage defaults which led to the meltdown.
"Read my link again. Banks traditionally held a lot of their mortgages to maturity."
Tradition?
Who cares about tradition?
You claimed Bush eliminated the regulation.
There was no regulation?
Were you lying?
Or were you just stupid?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
Have you got an actual direct link to a cite which backs up your claim that the secretary was paying 30% income tax?
"Read my link again. Banks traditionally held a lot of their mortgages to maturity."
Tradition?
Who cares about tradition?
You claimed Bush eliminated the regulation.
There was no regulation?
Were you lying?
Or were you just stupid?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
The Bush administration regulators?
I recall Bush screaming from the rooftops about these problems and Frank, Waters, etc. basically calling him racist.
You pose that like they are mutually exclusive.
He cannot read something and draw reasonable conclusions from it. An interview with a mortgage person who says that lenders were watering down criteria suddenly becomes "Bush deregulated the mortgage industry."
I worked in the industry for 9 years. Criteria are always shifting. The artificially low interest rates of the mid 2000s (and starting with 1999 and Y2K) made mortgage lending very profitable. Eventually you run out of good credit risks so you have to ease. With rising property values it isn't a bad bet because your equity cusion is growing as well. But eventually you reach a point where you're writing crap and crap goes bad in about 18 months. Which is what happened. Initially the melt down was limited to subprime. Eventually they figured out that even the A vanilla loans were really subprime.
The Bush administration regulatos chose not to regulate firms like Countrywide and Ameriquest and these firms gradually lessened their lending standards, resulting in huge amounts of bad loans which in turn led to the meltdown. It's all there in black and white described by a Wall Street fund manager who covered the whole thing as it happened, predicted the bursting of the bubble and then wrote a bestselling book about the whole thing. That's the facts on my side of the argument, along with other sources like the New York AG and George W Bush himself making speeches where he scraps regulations for new loans.
On your side of the argument is your claim to have worked in the mortgage industry and, uh, standards are always shifting. So yeah, i'm happy with the way this debate is going.
Well, first you said Bush deregulated the mortgage industry. That wasn't true and you failed to show it.
Now you say Bush regulators (who?) chose not to regulate Countrywide and Ameriquest. Please show where they chose not to. Much of Countrywide's loans were sold to Fannie/Freddie, which set credit terms. Those in turn are regulated by Congress, not the President.
Your credibility here is slipping.
Interesting articles.
Still does not change what I remember about energy futures being a new market. Nor does it change the fact that I remember the problem being with the financial reporting, not the trading itself. Enron created that fake energy crisis to hide their fraud, not to manipulate the market. The strange thing is that some people still think it is the fake crisis that was the problem, not the fraud.
Easy Guide to Understanding ENRON Scandal Summary
This is another thing Enron were doing illegally. But they were also manipulating markets and gouging customers due to the deregulation of California's energy markets. It's there in black and white.
And, as I pointed out, they manipulated the market to hide their fraud, not to take advantage of the deregulation of CA markets. That makes the effects of deregulation of the energy market secondary to what happened, not primary, and still proves that Enron did not fail because of new deregulation in the market that never existed before.
"Read my link again. Banks traditionally held a lot of their mortgages to maturity."
Tradition?
Who cares about tradition?
You claimed Bush eliminated the regulation.
There was no regulation?
Were you lying?
Or were you just stupid?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
Deregulation implies they ended up with fewer regulations, they did not. The regulations were changed because politicians from both parties jumped onto the bandwagon of more home ownership would be good for America. They then allowed banks to require less down, and actually made up new regulations to make it look safe by allowing them to bundle the mortgages for sale and have them rated by an outside agency. That was actually imposing more regulations on the banks, not fewer. The result was catastrophic, but it does not prove the answer is even more regulations.
Interesting articles.
Still does not change what I remember about energy futures being a new market. Nor does it change the fact that I remember the problem being with the financial reporting, not the trading itself. Enron created that fake energy crisis to hide their fraud, not to manipulate the market. The strange thing is that some people still think it is the fake crisis that was the problem, not the fraud.
Easy Guide to Understanding ENRON Scandal Summary
This is another thing Enron were doing illegally. But they were also manipulating markets and gouging customers due to the deregulation of California's energy markets. It's there in black and white.
Do you mean the half-deregulation of California's energy markets?
What do you think about the regulation preventing long-term energy supply contracts?
The Bush administration regulators chose not to regulate mortgage firms and, like the link says, from 2002-8 there was basically no effective lending standards at all, and the securitisation of the bad loans made in this period led to the meltdown. What part of this don't you understand?
The Bush administration regulators?
I recall Bush screaming from the rooftops about these problems and Frank, Waters, etc. basically calling him racist.
Yes, the Bush administration regulators. the regulators in charge of regulating the mortgage markets that wrote hundreds of billions of dollars of bad mortgage paper during 2002-8. What part of this don't you understand?
Have you got an actual direct link to a cite which backs up your claim that the secretary was paying 30% income tax?
Plenty of actual links when you click...
And it was Buffett's claim she was paying 30%.
The Bush administration regulators?
I recall Bush screaming from the rooftops about these problems and Frank, Waters, etc. basically calling him racist.
Yes, the Bush administration regulators. the regulators in charge of regulating the mortgage markets that wrote hundreds of billions of dollars of bad mortgage paper during 2002-8. What part of this don't you understand?
Where did the roots of this problem come from? Surely before Bush ever came into office.
Yes, the Bush administration regulators. the regulators in charge of regulating the mortgage markets that wrote hundreds of billions of dollars of bad mortgage paper during 2002-8. What part of this don't you understand?
Where did the roots of this problem come from? Surely before Bush ever came into office.
Yes, ever since we started seriously deregulating the economy. The first wave od deregulation under Carter and even Reagan removed a lot of the onerous and actually bad regulation and was a good thing but over the years deregulating markets has become a religion for both parties and especially the GOP, and has basically taken the form of corporate political donors spending billions to have regulations that get in the way of their profit-making removed. Since the SC ruled that corporate political donation is free speech back in the late 70s corporations have increasingly bought all the government that they didn't previously own and in recent years it's led to the 2008 meltdown and the subject of this thread, which is that corporations make basically all the money now.
Where did the roots of this problem come from? Surely before Bush ever came into office.
Yes, ever since we started seriously deregulating the economy. The first wave od deregulation under Carter and even Reagan removed a lot of the onerous and actually bad regulation and was a good thing but over the years deregulating markets has become a religion for both parties and especially the GOP, and has basically taken the form of corporate political donors spending billions to have regulations that get in the way of their profit-making removed. Since the SC ruled that corporate political donation is free speech back in the late 70s corporations have increasingly bought all the government that they didn't previously own and in recent years it's led to the 2008 meltdown and the subject of this thread, which is that corporations make basically all the money now.
So IT WAS more than just Boooosh. That I do agree with.
Yes, ever since we started seriously deregulating the economy. The first wave od deregulation under Carter and even Reagan removed a lot of the onerous and actually bad regulation and was a good thing but over the years deregulating markets has become a religion for both parties and especially the GOP, and has basically taken the form of corporate political donors spending billions to have regulations that get in the way of their profit-making removed. Since the SC ruled that corporate political donation is free speech back in the late 70s corporations have increasingly bought all the government that they didn't previously own and in recent years it's led to the 2008 meltdown and the subject of this thread, which is that corporations make basically all the money now.
So IT WAS more than just Boooosh. That I do agree with.
What do you disagree with and why?
So IT WAS more than just Boooosh. That I do agree with.
What do you disagree with and why?
I put more of the blame on Congress and Senate than I do with any president. They are the ones that come up with this type of legislation. Usually by the money of lobbyists.
