Chicago Daily Observer

The modified $700 billion Wall Street rescue bill just passed the Senate by a 74–25 vote. Now it heads to the House; if it passes there, onto President Bush who favors the rescue plan.

Here is a list of the senators who voted against the rescue bill:

- Waye Allard (R-Colo.)
– John Barrasso (R-Wyo.)
– Sam Brownback (R-Kan.)
– Jim Bunning (R-Ky.)
– Maria Cantwell (D-Wash.)
– Thad Cochran (R-Miss.)
– Mike Crapo (R-Idaho)
– Jim DeMint (R-S.C.)
– Elizabeth Dole (R-N.C.)
– Byron Dorgan (D-N.D.)
– Michael Enzi (R-Wyo.)
– Russ Feingold (D-Wisc.)
– James Inhofe (R-Okla.)
– Tim Johnson (D-S.D.)
– Mary Landrieu (D-La.)
– Bill Nelson (D-Fla.)
– Pat Roberts (R-Kan.)
– Bernie Sanders (I-Vt.)
– Jeff Sessions (R-Ala.)
– Richard Shelby (R-Ala.)
– Debbie Stabenow ... Read More...

Rose City Archery Inc., an Oregon company that makes arrows used by children, hit a bull’s-eye with Senate legislation that would rescue Wall Street banks.

Senators attached a provision repealing a 39-cent excise tax on wooden arrows designed for children to an historic $700 billion bank rescue that is likely to pass tonight. The provision, originally proposed by Oregon senators Ron Wyden and Gordon Smith, will save manufacturers such as Rose City Archery in Myrtle Point, Oregon, about $200,000 a year.

It’s one of dozens of tax breaks benefiting Hollywood producers, stock-car racetrack owners and Virgin Islands rum- makers included in the broader legislation in an effort to win support from House Republicans, whose defection contributed to a rejection of an earlier version of the legislation two days ago on a 228–205 vote.

t’s ghastly to take a look at the old “Tribune”…prior to last Monday…and see its clean lines, finely arranged white space with superb headlining and photo juxtaposition in relation to stories…and see the horrible hash now masquerading as the product. Designed apparently by a committee, it evinces total confusion over what it wants to be: a challenger to the blatantly sexual “Sun-Times” or a localized edition of “USA Today.” You search in vain to find the editorial pages. Almost everywhere they are in the back of the first section. Not here: they are tacked improbably to the Business section. With huge black and white photos there is only room for one…or at the most…two columns. As recorded here yesterday, the Pulitzer prize-winning Charles Krauthammer is dissed over to the “Trib’s” internet edition to make room for the latest critic of Sarah Palen.

Yesterday’s “Trib” or the sad representation of what ... Read More...

inancial problems have not yet dragged down the economy, but it is also true that the economy is not the cause of financial-market problems. Most of the loans that have been going bad in recent months would have gone bad even if the economy had been growing twice as fast. So what is to blame for the “worst financial crisis since the Great Depression”?

The answer seems simple. Mark-to-market accounting rules have turned a large problem into a humongous one. A vast majority of mortgages, corporate bonds, and structured debts are still performing. But because the market is frozen, the prices of these assets have fallen below their true value. Firms that are otherwise solvent must price assets to fire-sale values. Not only does this make them ripe for forced liquidation, but it chases away capital and leads to a further decline in asset values.

To understand why the emphasis of policy must switch from punishing bank shareholders to giving them some comfort, we have only to ask why more banks keep failing despite the huge amount of public money being poured into bank “rescues”and “bailouts”. The answer is simple: the government rescues that have cost so much money have not been rescues at all. They have been more like demolitions or robberies. Governments have guaranteed bank deposits, but they have wiped out the value of bank shares. This expropriation of bank shareholders has not only put the “rescued” institutions out of business. It has sabotaged the viability of other banks, as investors dump their shares before they are “rescued” like Bradford & Bingley or AIG.

A mere accounting rule change won’t reduce foreclosures or raise home prices—then again, if spared drastic writedowns, banks might be more willing to lend, raising home prices and reducing foreclosures.

A mere accounting rule can’t alter the underlying economics of a lending business—then again, no longer worried about insolvency-by-accountant, investors might discover new confidence to inject capital and improve the underlying economics of a lending business.

No accounting rule is worth $700 billion. Then again, the essence of the Paulson plan was to raise the value of bank assets to help banks escape the regulatory equity trap. Does that mean we can change an accounting rule and save Congress from having to appropriate $700 billion?

Let’s find out.

The front page of the Chicago Tribune features a nude painting done by a 69 year old artist – who employed his daughter as a model for Governor Palin. The Chicago Tribune editorial geeks are solidly behind Senator Obama. Along with the cork-screwing Sun Times, the Tribune engages in a daily beatdown of McCain or Palin. No big deal really as no one in Chicago seems to pay much attention to the Chicago editorial dweebs and pencil-necks who tend to live in lily-white suburbs while celebrating diversity.

With all the news that the Chicago Tribune is not covering – Tony Rezko, Willliam Ayers and their long and close associations with Senator Obama; another murdered Chicago Police Officer; multiple killings and shootings on the south and west sides; a moronic Governor bankrupting the State; Public Schools looting the budget and world wide terrorism; the editorial snobs decided to be edgy.

The ... Read More...

For ACORN, it’s all about the sawdust.

The Association of Community Organizations for Reform Now (ACORN) has come under fire for a plethora of scandals lately. The most prominent of these scandals surround s the issue of rampant voter fraud, a practice that ought to be particularly troubling considering the virulent, pro-Obama partisan nature of the group.

Most recently, ACORN has been implicated in voter fraud schemes in over a dozen states, having submitted thousands of fraudulent voter registration cards in places like Missouri, Washington and Ohio. The organization apparently had no qualms about registering dead people, re-registering already registered voters, or fabricating drivers’ license numbers.

The latest attack on ACORN, however, comes not from Republicans, Talk Radio or ... Read More...

Emanuel, who served as a board member for Freddie Mac, one of the agencies that precipitated the economic crisis the nation now finds itself in, had no misgivings about taking a leadership role in tanking the bill. “He was cheerleading us along, mothering the votes,” says the aide. “We wanted enough to put the pressure on the Republicans and Congressman Emanuel was charged with making it close enough. He did a great job.”

Emanuel apparently is concerned the roles former Clinton Administration members may have played in the mortgage industry collapse could be politically—or worse, if the Department of Justice had its way, legally—treacherous for many.