can't believe this hasn't been brought up yet.

“Today’s vote was a recognition of the revenue crisis facing our state and 47 others, and the need for immediate responsiveness on the part of the Legislature to the state’s current budget emergency. “Suspending the entire initiative allows for prompt action now, avoiding the added delay and additional cost to the state that a November public advisory vote would require. The state Treasurer says the state will run out of cash by September, so you can see how that sort of delay is something the state just can’t afford. “We will run a bill as soon as possible on the Senate floor in line with our original intent to suspend I-960 in full until July 2011.”

That move caught my eye, and my ire. It also caught the attention of another person who put it rather well. See below.

I have a 7 year old son who comes home from school bright eyed and excited to learn about our Presidents. The son of an educator myself, I try to be a good father and further educate him about our history, our constitution and how our form of democracy works and then you F'ing S.O.B's turn around and pull [censored] like this. What the hell am I to tell my children now? This is not the democratic process I spent 8 yrs of my life overseas defending as a veteran of our great nation. Never in my wildest imagination did I think that my time spent in the sweltering desert heat of Kuwait, eating sea rats and avoiding land mines would be squandered defending the likes of you.

I understand this is pretty harsh language to write public officials, but the arrogance of you people to vote for SB 6843 deserves nothing less than the full venom of my Veteran Sailor Mouth. You are certainly are not acting like servants of the people, but rather arrogant snobs who view "we the people" as mere pawns in your social agenda chess game. I'm a good father, husband, veteran, citizen and neighbor and I am appalled that you would even consider voting against the will of the people. We have spoken, the courts have ruled and the law is the law. I don't care if you don't like I-960, it is the law and the will of the people. I don't think you have recourse, but if you think the times are so challenging that we need to revisit the issue, then you should send it back to the people to validate. For you to take matters in your own hand and go against the will of the people is simply - unconscionable.

While I'm certain that I would not agree with most of the democratic politics of Sen Hobbs, Kauffman, Kilmer, Marr and Sheldon, I do at least have respect for them for following the will of the people and voting no. Massachusetts was no fluke and actions like this only further alienate the voters. If you wonder why “we the people” are so angry, you need only look in the mirror and have yourself to blame. If you think that taxation is the way out of our budget mess (that you helped create), then you need only follow the will of the people and convince 2/3's of the House and Senate that this is our only recourse. If you can't do that, then go back to the table and cut spending to balance the budget. If the cuts are "too harsh" then you should think about that next time we have a budget surplus and you’re encouraged to "tuck it away for a rainy day" as you were encouraged to do only a couple short years ago. I understand I have the right to vote with my feet, but I’ll be damn if I'm going to surrender to a bunch of cowards who are trying to shanghai the democratic process. I’ve always been a coffee drinker, but having a Tea Party has never been so appealing. I don't understand why you are choosing to pick a fight with “we the people”, but if a fight is what you want, a fight is what you'll get...

Here are the asshats that voted to move this forward.

berkey.jean@leg.wa.gov,
brown.lisa@leg.wa.gov,
eide.tracey@leg.wa.gov,
fairley.darlene@leg.wa.gov,
franklin.rosa@leg.wa.gov,
fraser.karen@leg.wa.gov,
gordon.randy@leg.wa.gov,
hargrove.jim@leg.wa.gov,
hatfield.brian@leg.wa.gov,
haugen.marymargaret@leg.wa.gov,
jacobsen.ken@leg.wa.gov,
kastama.jim@leg.wa.gov,
keiser.karen@leg.wa.gov,
kline.adam@leg.wa.gov,
kohl-welles.jeanne@leg.wa.gov,
mcauliffe.rosemary@leg.wa.gov,
mcdermott.joe@leg.wa.gov,
murray.edward@leg.wa.gov,
oemig.eric@leg.wa.gov,
prentice.margarita@leg.wa.gov,
pridemore.craig@leg.wa.gov,
ranker.kevin@leg.wa.gov,
regala.debbie@leg.wa.gov,
rockefeller.phil@leg.wa.gov,
shin.paull@leg.wa.gov,
tom.rodney@leg.wa.gov

Vote them out. Shrink the size of our bloated state government, and send some people home. Many businesses have laid off staff. Not 1-2%, but more like 10-20%. The State needs to do the same, and the queen is a god damned bitch who needs to be run out of office for her fiscal mismanagement. Asshattery!

Exactly!

4 times in the last 17 years the voters have by the initiative process have tried to rein in the power of the legislature to tax at will and each time our representitives have voted against the will of the people.

Heard this on the radio on the way home last night, and pard and I discussing it this morning.........what in the hell are these idiots doing?

Not enough revenue off the Indian Casinos? Answer: Powerball

Hybrids sucking the life outta the gas tax? Really? Ever wonder why the Indian gas stations are $0.25 cheaper? Chrissy gives them back the gas tax they collect. State's answer: Raise the gas tax of course.

No incumbent should be re-elected with this crap playing out on their watch

This HAS been brought up before and I'm still waiting for an answer. I don't like it either...tax those that are already down...but where do you suggest we cut to make up $8 billion? Remember it has to add up to $8 billion not ten grand here and ten grand there. So have at it.

Both parties suck but I'm absolutely convinced we'd be in worse shape had the GOP been running things with their increase expenses while cutting revenue mentality.

If I don't have a job I can't pay taxes.

My suggestion,

Go back and cut the programs and jobs that Gregiore put in place since she took office. That would be a good start. The state ran fairly well prior to those additions.

+31 (%)

No need to tax casinos just tax the sh!t out of gillnets and there use.

Ban any further initiatives.

We don't live in a Democracy, we live in a representative Republic.

Sorry 'bout that.

Altho it's the height of legislative arrogance, I can see why the members of the Legislature are so willing to trounce the will of the people as expressed by initiatives "of the people." Initiatives only come about because citizens feel that the Legislature has failed them in it duty to govern. By definition, legislation passed by initiative indicates that the citizens had to do for themselves what their elected representatives couldn't or wouldn't do. Kind of shows them up as not completely competent. Pisses them off. Their answer: undermine citizen initiatives.

I completely agree that the state is in a tough financial position. It's in a tough position because too many citizens are in tough personal and business positions. The best way through this financial crisis may well require both deep spending cuts that truly hurt people and additional tax revenue that truly hurts people. However, the citizens have spoken and declared that if additional taxes are a necessary part of the solution to state financial troubles, then following the law, with 2/3 majorities, is the appropriate way to do it. Undermining the people just pisses off the citizens who are actually willing to support a temporary tax hike to get us through this crisis, creating new opponents of the Legislature. It's so simple, even a caveman would get it.

Sg

The Washington Legislature has set themselves up to screw the "will of the people".

In WA, the legislature can start screwing with Initiative law after it has been on the books for two years, so now, once again, the WILL OF THE PEOPLE will be circumvented by slick, overspending BIG GOV'T. Too many "entitlement" programs that became liabilities, and now we have to continue paying for the mistakes of others.

This could never happen in Calif (equally as broke as WA). In Calif. the WILL OF THE PEOPLE can not be infringed once an Initiative is passed into law. Californians have protection from this crap...we, OTOH, do not.

ISO

You mean as long as the 9th Circuit Court of Appeals doesnt overturn it?

Remember Prop 8

Yeah, them Californians are really diggin' Prop 13 right about now.

I'm curious ISO, which "big government" entitlements that have become liabilities here in WA are you referring to?

Sure...happy to help!

Let's start with these:

http://seattletimes.nwsource.com/html/localnews/2008775541_apwafoodstampchecks.html

Then, go look up the ultimate Washington State porker...more
commonly known as "The Zero Energy House"

They (WA. Gov. and legislature) are going to screw us to the hilt...
and some people here, sadly, will be thanking them for it.

ISO

speaking of Jacobsen... he was quoted in the seattle times recently...

Sen. Jim Hargrove, D-Hoquiam, told lawmakers that Democrats take I-960 seriously, but "as we have an economic crisis or something difficult to deal with, we suspend the will of the people for a period of time in order to do our business here."

extreme arrogance if you ask me...

Maybe I'm reading this wrong, but doesn't it basically say that by spending a little over $250K will "...trigger an additional $43 million in federal food benefits." If so, that seems like a pretty good return on investment.

How many tax dollars are going into the project? I couldn't find anything when doing a cursory search.

It's pretty simple. Vote out those you don't agree with. The people spoke their will via the initiative. The legislature has the legal authority to ignore the will of the people. The people have the right to toss out the legislators that offend them. Pretty good system actually.

I have no problem with cutting/restraining taxes, but get pissed when the ones who complain about taxes complain about not getting the services they want.

I was in New York recently and folks were up in arms becasue they were considering cutting garbage service back to once a week. People get used to any service you provide and squeel if you try to reduce it.

Another simple problem fixed is to cut mail delivery to five days a week, like many countries have done for years. No big problem and a huge savings.

This is a prime example of how the ferderal government holds a gun to the head of states. By spending a certain amount of money the feds grant the states money for added benefits. Putting the states at the whim of the feds and causing them to spend money they don't have.

By refusing to address the budget issue with cuts and running an end around I-960 the dems are committing politcal suicide. If I'm in financial trouble personally I don't go out and borrow more money to cover my bills. I sell the driftboat, cancel the vacation, and start eating top ramen for a while.

The current path most state governments and the federal government are on is unsustainable. If the current course is continued then foreign creditors will run for the door and there will be a currency crisis almost overnight. Anyone who believes otherwise or that America is imune to such happenings is completely ignorant. A cursory look at history will show you that no fiat currency has survived for more than 60 years. This is why the founders granted only Congress (not the Federal Reserves banksters) the power to coin money and regulate the value thereof and that only gold and silver should be legal tender for all transactions.

Until this country wakes up and realizes that the value of their money is being inflated away by overspending gov'ts and private banks all to willing to create out of thin air for them, then we will contiune down this path of budget crisis' and never ending inflation.

I was thinkin' the exact same thing GH?

Also, which taxes are going to go up exactly and by how much I wonder?

It sounds great to say "Democrats are gonna raise taxes and screw the citizens of this state"... but the facts NEVER quite seem to support that assertion?

I wonder why that is...

That's not what it sounds like at all to me. Sounds more like the Fed saying, "I'm not going to fix your entire problem. You put in X-amount of dollars, and then I'll help you out with the rest."

Somewhere in the equation is a threshold of X-amount set by the Fed, either arbitrarily or through some mind-numbing algorithm. Whatever. Washington state just happened to realize that by spending an addditional small amount--relatively speaking--they gained a good amount in return. It's actually quite smart and quite common in business practice.

WOW I finally read a KK post that made sense. Way to go.

KK is right on the statement above, it is a worldwide crisis.

But I certainly don't agree with the queen, not one bit, on her fiscal mismanagement.

While we are dealing with a world economic issue, we would have been in a better situation finanically if she wouldn't have bargained away gas, cigarette, and liquor taxes to the Tribes. The same goes with not taxing Tribal casino's. Absolute financial mismanagement.

That was all her.

Indeed KK this is a global situation but you citing a "flight to quality" is temporary at best. Do you really think foreign buyers of short term T-bonds are going to be satisfied with the debt being payed back with more debt? Pray tell, how long do you think this ponzi scheme is going to last?

China has already been absent from some of the latest treasury auctions. As well as Russia and India. Instead they have opted to buy gold reserves. To boot, China is encouraging their citizens to invest their savings in gold. The Fed can't supply demand for T-bonds indefinately and their game is easily spotted if you taken a look at the latest audit figures.

So the dollar temporarily gains againt the Euro. Which ironically is in trouble for many of the same reasons the dollar is in trouble, only much worse. That doesn't elude the fact that America's current debt crisis is unsustainable at it's current pace. So there is a temporary flight to quality in US T-bonds. When Europe straightens out their crisis and that capital flows back into their domestic markets, then what? An enormous spike in interest rates circa ealry 80's and an unmanagable debt load to go with it.

If you're counting on world-wide collapse to rectify the spending habits of our federal government in a "flight to quality" you are sadly mistaken.

After all the Limo Liberals already got thiers so we will just go with a new economic model where the beautiful people split a sliver of the pie up amongst the peasants.

Certainly don't want any peasants starting Co's like Boeing, Microsoft, Google etc.................

I'm sure we will like this new world!

I just hope I don't have to stand in the bread line so long I don't get to the unemployment line in time for my small piece of the pie. If there is any left that is

Funky Chicken spoon KK. Skip the herring.
Let the other guys drag bait. You catch the fish.

Probably. Or Lynnwood.

KK I agree with your post completely other than your assertion that this problem has nothing to do with government.

You seem to be a smart fella. Why you fail to see the moral hazards created by government policy is completely beyond me.

You mention derivitives, or more easily explained as insurance, or a bet if you will. If I am Goldman Sachs and I want to hedge a position I have with say,....GM corporate bonds. I can go to AIG and ask to buy insurance on my position with GM. AIG will charge me a premium for the insurance and I will get paid the full face value of of the bond should GM default. Sounds OK on it's face right? Well here's the kicker. I don't have to own a position in GM corporate bonds to buy the insurance. Here's another even bigger kicker. AIG doens't need to have the money on hand to pay me should GM default. So who's on the hook then? The taxpayer is.

What's this have to do government? That's just the evil free market working the way it's supposed to right? Wrong. Simple fraud laws and the SEC doing their job would have kept this in check. Let us not forget either the repeal of Glass-Steagall and Summers and Geithner advocating successfully for the raising of leverage limits. Companies were allowed to leverage themselves to critical positions at the behest of the federal government. Community Reinvestment Act rules engaged banks in subprime lending as a matter of policy. Banks were required by the government to raise debt to income levels required for loan acceptance. Required to approve applicants with lower credit scores and required to lend on collateral that was located in less than satisfactory regions. Ratings agencies knowingly falsly rated the associated MBS and CDO's, all under the nose of the SEC. Once the game was rigged and secondary markets in place with an endless pipeline of low interest Federal Reserve money to grease the skids it was all over. Smaller more prudent banks were forced to either join in the madness or get run over by the train.

You are right though. We are seeing a complete restructuring of economies world-wide. What this restructuring will lead to is a significant drop in the standard of living for middle class people worldwide, including the US. Third world countries will continue to suffer under IMF/World Bank loans and their austerity measures. First and second world nations will be forced into the same rat trap to get out from under their massive debt obligations. It will be decades until we see 5-7% unemployment again. The jobs lost this time around are gone for good. It's funny you site these things yet still believe that a "flight to quality" is going to save our debt crisis. If America is going to have to restructure and unemployment remain high just exactly do we keep that AAA rating again? Maybe I should ask Mr. Geithner that question in 5-10 years.

All is an example of the abject failure of fractional reserve banking and the Keynesian model. Not a failure of the free market as I would assume you would trumpet. This country has had anything but a free market for the last 100 years. Soft facism or cronyism is more like it.

They run the only business that counts for liberals-the Government! Which also seems to be the only business growing at the moment

BM is on come hell or high winds! Fri and Sun look good but Sat is a wee bit sketchy. Good excuse to fix my wiring issue's and get the 2nd dr installed! So one way or another it will be productive.

Perhaps I misread, or read into it. Regardless, a short term solution to a problem spanning generations is exactly the kind of thinking that contributed to getting us where we are at today. Stabalization at all cost,......if you will. While the reverse may be true tomorrow or 6 months down the road a currency crisis is indeed what we will face long term whether we like it or not.

We are in agreement as to the wholesale ownership of government by corporate interests. You know as well as I do bills are not written by lawmakers. They're written by staffers and lawyers placed in the lawmaker's office by those with the greatest interest and influence. You see, I don't draw a distinction between the two (government and private interest). The revolving door into the US Treasury and Federal Reserve from Wall Street should be evidence enough for anyone that the game is rigged. The clash between the two entities and Dems/Repubs is nothing more than a shell game, made for people with TV's and little ability to think critically. Anywhere you find concentrated power you will find corruption, there's no escaping it. Where I think you and I differ is that I would like to decentralize that power and move it closer to the people as where you may prefer a more centrally planned economy (speculation on my part).

Make no mistake about it, as I was involved directly. Banks were required to make a set volume of loans to low income borrowers on less than satisfactory collateral. This was satisfied by wholesale markets expanding underwriting criteria in regards to debt to income rations, loan to value ratios, lower FICO scores, and substandard collateral. Those were sold to consumers through brokers and retail channels, sent back to wholesale, packed into MBS's and passed along to secondary (usually ending up in the hands of Fannie and Freddie). Hence the birth of the subprime mortgage loan. Something that without the careful and deliberate cooperation of the Federal Reserve providing the money to do it through low interest short term lending facilities, could have never been accomplished. This is the reason people were out buying things that they couldn't afford from an oppressive regime half way across the world while our factories were boarded up at home. There will always be demand, people always want things. It's when the price of money is manipulated by a government controlled entity (really just a private bank) that provides the moral hazard for unknowing folks to get into trouble.

The market should determine interest rates. Not some wizard in an ivory tower with a funny cap. Or at least we should be privy to the decision making process, or committments we may have with foreign central banks, or the names of broker dealers who are funneled billions in tax payer funds through the Plunge Protection Team. Pie in the sky I know. Although people should be more aware of what is really going on.

I'd like to go on, and on I could go. Although I'm being sumoned to wrap it up.

Thanks for the welcome and civilized discussion.

A quick look over the archives does indeed show you to be a bit of an a$$hole. Though you don't have me convinced. In my experience those who show that quality when engaged in debate either don't have supreme confidence in their position, or they are intentionally misleading. It's much easier to bury an opponent when you have them thinking about their mother

Don't be fooled, SW...he really is just an a$$hole.

Fish on...

Todd

I'll disagree on the first line. Totally agree on the second line. (Assholes have to stick together. Wow, that sounded kinda ghey.)

Funding innovation is what got us here. CDS, other deriviatives, etc, were all forms of funding innovation, creating great things out of crap, essentially polishing turds. The biggest issue was the actions of the money center banks who's CEO's had to follow the lead of the other "funding innovators", lest they be canned. The boards of directors of banks behind the curve noticed the profits of the other banks who were using derivatives and other "unique financial instruments" and gave direction to the CEO's and presidents of the other banks and said, "Make money!"

We saw this at our bank and couldn't make sense of it, the option arms primarily. Approve a person at a payment based on a 1.9% rate, give them a negative amortizing loan based on the 1.9% "supposedly fixed rate", yet the underlying loan was actually accruing at a rate of 7.5%. Add in a 110% LTV clause so that when the loan balance reach 110% the payment switched to the payment based on the 7.5% rate. Payments doubled. These were essentially ticking time bombs, where 5% of the original loan balance accrued every year, so $0 down loans, or 3% down loans, were destined to implode 2-3 years down the road.

We (your local community bank or credit union) didn't cause this bull sh!t, but we have certainly taken LOTS of collateral damage. My little bank started scaling back on spec financing in 2006, and stopped it altogether in 2007, except for projects under way. Thankfully. It was unpopular, and certainly not innovative, but it saved our ass. We saw the writing on the wall.

As far as the incentive to lend, that has all but been regulated away. Imagine if you will each bank has a number of buckets. These buckets represent the limit of how much of a percentage of the net worth of a bank can be leveraged towards certain types of loans. We'll work in whole numbers, say $100 million is our net worth, aka total risk based capital. The standard for this risk based capital to be "well capitalized" (aka... having sufficient liquidity to weather loan defaults and a run on the bank) was 10%. Well the FDIC and OCC (office of the comptroller of the currency) changed this measurement to be 12% to be well capitalized. This dried up the ability of banks to employ funds in an "innovative manner". Instead of leaveraging at 10:1, the ratio changed to 8:1, reducing money on the street available to lend by 20% overnight. Add to that the change in the bucket method, where it was okay to use 300-500% of your equity on non-owner occupied loans (hotel/motel, apartments, rental houses, where income from rents repay the note) to a "written in stone" limit of 300%. We were at 374%, or $374 million (MM) in this type of loan when the decree was handed down to us. We had to wait until $74MM paid down vefore we were at the limit. If you had more than 300%, guess what, no lending, period, in that category, no matter what, until you drained the excess out of that bucket. The fawkers hit us at both ends of the spectrum, making many banks pass on completely bankable deals. ( I turned away 3 decent deals this week because of this. ) Obama is a fool because he wants banks to lend money "dammit". The policies put in place by his administration are hampering lending, not helping. He has no clue.

I have no love for that whore, our governor, as she has sold us out, and so have the folks who voted to suspend the initiative. Every chance she got, she sold us out. Unions, tribes, etc. Now it is their chance to correct government, and they choose to not make the hard sacrifice and cut staff within the State machine. Every other business has had to do this, except for one of my clients in the Voc Rehab business (and they are looking for employees if you are a techi). Time for the State to bleed off some excess as well.

Lots more to cover, but I have a some wine calling my name.

Don't get me started on "yo Momma".

A nice Zinfandel. Dark, bitter, and whiney. Just the way I like my women.

Good on you for your financial institution choice. I worked for B of A, formerly Seafirst, for 10 years. Seafirst was great, local focus. B of A, not so. Had an opportunity to ask a question of Ken Lewis, former B of A CEO (who is under investigation for fraud). Asked him about expansion into outlying communities. His response was that "he was taking the bank where there were more people than cows". Only numbers matered to him, not clients. A year later after they had culled all of the people with experience out of the bank, I left on my own terms. Your average banker at B of A now has enough talent to sell you a shirt, and that is about it. Most managers and personal bankers there are from retail businesses, with no credit or lending experience.

Big banks are for sheep. If you have issues with business lending at your CU, I might be able to refer you to a reputable community bank, as most CU's don't know business banking.

I do microloans all the time, usually what I call "Flyers". These are usually small loans of $5-20,000, well collateralized, to folks who have a dream and some means to repay the loans should that dream fail. Lots of dreamers every day without a grip on reality. Those get turned down immediately. Call me the dream killer.

Over the past six years or more voters have turned down every tax cutting initiative while at the same time voting for more taxes such as the 10 cent increase in the gasoline tax and the initiative to reduce class sizes. Add to this all of the local park levys that have passed along with other local intitiatives makes one wonder whether I-960 would even pass today. My guess is it wouldn't, and answers the question I heard Dori Monson pose today, "I can't understand why more people are not up in arms over the suspension of I-960".

I will theorize that since the economy has gone into the toilet more people are either experiencing or know someone who is experiencing what it means to be vulnerable for the first time in their lives. Perhaps people no longer have the stomach to cut more people off of basic services that alow them some level of medical care and a means to find some shelter and something to eat.

I was down at the Legislature last month. It is not lost on any of them the risk they take by suspending I-960 and raising taxes. Acutally for once I applaud some of them for putting their own re-election on the line rather then taking an all cuts approach like last year that left many of the vulnerable out in the cold.

KK, you asshole, of course White Zin is ratshit. That's a given. But you stop dissin' a decent chard, OK?

BTW, very good stuff on this thread, thanks to the asshole, SW, and DF. Do you guys know how good it feels to find intelligent life on this planet?

Sg

Dogfish,

You've hit the nail on the head here in many ways. The amount of negative exposure existing within the CDS market would make one's head spin. The initial $180 billion AIG bailout to cover counterparties (not one of which was forced to take a haircut BTW) was a mere drop in the bucket compared to existing face value on the CDS contracts. There are many figures out there, but to the best of my knowledge current face value on the contracts stands somewhere around 70-90 trillion,......with a T. It's hard to speculate the amount of capital invested in these premiums since there is no listed exchange and I haven't been paying attention for awhile but in late 2008 CDS contracts on Berkshire were going for 858bps. If you just used 900bps as a running average you could conclude that around 9 trillion has been paid into this system, probably much more. Add that to the fact the contracts can be sold, borrowed against, traded, and packaged. The web tangles even further. Assessing and attributing risk has become impossible with no clear chain of title and no real knowledge of who's on the hook for who.

Option ARM's are a whole other story indeed. At first they were primarily used in areas of California. They quickly spread to other states like Nevada, Florida, Arizona, and Washington. One of the last companies I worked for packaged and sold around 4 billion of Option ARM's in 2007 and we were a small wholesaler selling during the draw down. The MBS and CDO packages on these things were sold to unknowing pension funds, foreign governments and banks (in the know), and many large US banks (also in the know). They were all sold with the predication that home values in the US would never go down, ha! Many had LTV limits before recast of much higher than 110%. Most of the ones I packaged had limits of 125%. Most started out as 90-95% LTV loans, but many were also in the 80-85% range as UW criteria tightened in 2007. The damage now is two fold. The packages that are already worthless have been picked up by the Fed dollar for dollar from the big banks and now reside on the Fed's balance sheet with you know who on the hook. The other side of this is that the majority of the Option ARM's were written from 2005-2008 with 5yr neg am periods. This means that this year 2010 is the first year we will see any major recasts of these ARM's and will see recasts all the way into 2013. Don't quote me on this but I think that there is somewhere in the neighborhood of $200-$300 billion worth of these still out there. Thought we were throught the foreclosure mess? Think again. I personally won't be buying another home until 2013 or 2014. Renting is just fine by me until then.

You brought up some things about leverage ratios I was unaware of. Particularly the 8:1 rule for small banks. I knew smaller banks were disadvantaged but I didn't know by how much. Considering that, as an example, CITI was leveraged 33:1 prior September 2008. Also was uaware of the rule change for leverage concerning NOO properties. When did that change?

Good post and good discussion here. Salmo g,.......yes there is intelligent life on Earth. Now we just have to educate the masses to kill their television.

KK good on you for switching banks. I've been meaning to get away from my mega bank for some time now. No more delay from me. I think I'll do that today.

[quote=Kanektok Kid]You talkin' bout my Momma........... ............ ?

Are you insinuating that I would deliberately and repeatedly buffalo my debating opponents with off topic subject matter simply to rattle them and disrupt their train of thought ?


Or..........are you suggesting the talent pool here is somewhat lacking on both the theoretical and practical levels ?




I'm suggesting both

The NOO issue was a guideline before, and technically the same rule exists today, but during exams, regulators (FDIC and OCC) are saying that "You will not go over that guideline amount." The same goes with the 10% requipment to be a well capitalized bank. 10% is still the official measure, but "12% is the new 10%" when banks are sitting down with regulators during their exams. It depends on which capital measurement you use to arrive at the overall ration. Not sure which one you were using for CITI's

Going against the regulators can lead to bad juju on your safety & soundness exams. Nobody wins when they get a memorandum of understanding or a cease and desist order.

I'll address this one since I disagree. Specualtion on your part as to whether or not I-960 would pass today is a mute point. The point is that it is law. Passed by the will of the people. If you don't like it, offer a counter initiative this November and we'll see whether or not it would pass. Until then, the legislature should respect the law if they expect their constituents to do the same thing.

Why is it that those who favor budget increases always fall back to scaring the crap out of voters by linking budget cuts to throwing the poor and weak out onto the street? Are social services the only expendtiture of the state? The state budget has more than doubled under the wicked witches watch. Were we not taking care of our destitute in 2000? Administrative costs in nearly every state department are due for a haircut. Is it really neccessary for state departments like DSHS to buy brand new hybrids when their old ones hit 60k miles? The state has no property they could sell to private hands? I could go on and on.

8 billion is a lot yes. Small cuts here and there will not make 8 billion. But small drops do eventually fill a bucket. For the state gov't to not be taking proactive measures to reduce cost now is imature and intellectually lazy. Every penny matters and until frivilous costs are addressed the problem will only become worse. Raising taxes would be a disaterous policy to implement. Now, or anytime in the future. If you want to see unemplyment skyrocket in this state, raise taxes on businesses and implement a state income tax.

Cuts don't have to mean throwing single mother's and their children out in the cold. I'm tired of hearing that excuse every time cuts are brought up. It's a straw man.

I also get chapped when the WDFW gives grants to non-profits to buy land and keep it unavailable for access. How many millions here? Why help someone else buy land?

I've never understood that either, but there has been a pratice going on for decades the involves conservation groups and state/federal governments.

Often times money is granted to a conservation group by either a consortium of large banking institutions or state governments themselves. Zoning laws for particular properties of interest are changed in the name of "conservation". Unable to develop the land and having it severly devalued the owner is forced to sell to one of these "conservation" groups. Many of whom share board members with many of the large banks providing tax free grants to purchase the property in the first place. See where this is going here? After some time zoning laws are changed back to allow development in the area. Land developed and sold to highest bidder. The cycle has been washed, rinsed, and repeated all over the country.

I don't think there's a conspiracy with WDFW giving grants to non-profits. It's simple, really. Which Route will leave people bitching less?: for WDFW to buy and keep the land, resulting in allegations of overspending, lack of fiscal responsible, general debauchery, etc., or for WDFW to give the money to conservation groups for them to manage, maintain and worry about. I think it's pretty simple.

i think the part dogfish is getting at is that if these groups get public money to buy land, it should be kept accessible to the public.

Exactly.

Agreed.

Public money to purchase = public access.

Sorry, I didn't see the part about making the lands unavailable. My props go out to WA sportsmen for hanging tough, who, from an Idaho guy's perspective seems like your state is blatantly trying to stop all forms of recreational fishing and hunting. WDFW has just got no balls.

I emailed a bunch of legislators about this and got this response from Senator Kline of the 37th District:


Thanks for your regarding the suspension of I-960. Although I disagree with your stance on this issue, I appreciate hearing your opinion. I’d like to tell you why I voted for the suspension.



I’ve heard from hundreds of folks from my district, the 37th, about our recent decision to temporarily suspend Initiative 960. More than 90% of the calls and e-mails I’ve received from constituents support the suspension.



As you may remember, I-960 was enacted in 2007 with a mere 51% of the statewide vote. (Note that this is far less than the supermajority vote that the initiative requires to be made in the Legislature for any tax increase. Almost 69% of the good folks in the 37th voted against I-960.) Along with requiring that any tax increase to pass each house of the Legislature by a two-thirds vote, I-960 also allows tax increases be sent to a vote of the people. Tax increases may also be referred to voters for their approval or rejection. The initiative also mandated that any fee increase, regardless of whether in excess of the fiscal growth factor, must have prior legislative approval. In addition, the Office of Financial Management must publish cost information and information regarding legislators’ voting records on bills imposing or increasing taxes or fees. (Prior to implementation of this expensive process, this information was already available to the public.)



Given the fact that less than 22% of the people in my district supported I-960, I was happy to co-sponsor the original legislation calling for the suspension. After all, these are the people who elected me to represent them in the Senate. As you may have heard, we ran into a snag during the passage of this legislation. We passed the original bill, SB 6843, on February 9 after a very long debate during which many opponents of the legislation talked about how suspending the initiative would violate the will of the people. For many of the opponents, this was a disingenuous argument, since they had previously supported changing other initiatives that they don’t like, such as the initiatives limiting class size in K-12 schools or requiring Cost-of-Living raises for teachers. Another prime example of an initiative that many legislators have tried to amend over the years is the 1998 initiative that set our state’s minimum wage, and required that it be adjusted yearly based on the federal Consumer Price Index. This initiative passed with over 65% of the vote, but Republicans have prime-sponsored more than 20 bills since it passed to suspend, amend or do away with the initiative. (Some Democrats signed onto these bills.)



Although the opponents often mentioned that our constitution enables The People to pass laws via initiative, they failed to mention that the same document also gives the Legislature the right to amend these statutes after two years.



Due to a complicated misunderstanding and paperwork error, we had to revisit I-960 once again on the Senate Floor on the following day. The new bill, SB 6130, was passed out of the Senate and is now scheduled for a hearing in the House Committee on Finance. It would suspend all of the provisions of I-960 until July 2011.



The provision calling for a supermajority to vote Yes on any tax increases has no place in our democracy. In our representative democracy, legislators are elected by people to legislate according to the will of the people in our district, and our constitution makes it clear that a majority vote is the method we are supposed to use for this purpose. By imposing a requirement for a “Yes” vote by a supermajority, I-960 gives a small minority of legislators the ability to hold up the majority’s work. It also has problems with regards to the definition of taxing, and requires costly extraneous notice and fiscal determination provisions of information that is already available to the public.



Tim Eyman, the initiative salesman who makes a good living passing initiatives like I-960, testified at the hearing of the original bill. At the hearing, I asked Tim the question I’ve been asking forcefully for many years: what programs do you want us to cut if we can’t raise the revenue to pay for them? He has never given me a substantial answer to this question. I’ve asked this question of him in legislative hearings, in newspaper articles, at press conferences, and via e-mail. He always cavalierly shrugs it off and says that creating a budget is the job of legislators, and that his job is to cut taxes.



The purpose behind amending I-960 is to give the legislature more flexibility in addressing the current economic crisis. Last year's state budget cut K-12 and higher education, social services, and healthcare, making it more difficult for struggling families to educate their children, stay healthy, and survive the current recession. The magnitude of cuts that will be required this year if revenues are not increased will seriously threaten the wellbeing of the children, elderly and other vulnerable populations in our state



Faced with a $2.67 billion shortfall, we are pursuing a comprehensive solution to re-balance the state budget and fund vital services. Already this year, the House and Senate have approved new cuts that, when agreed upon, will save close to $100 million through June 30, 2011. These include cuts to the state payroll, an extended salary freeze for many state workers and the curtailing of equipment purchases, out-of-state travel and the filling of open positions. Further actions will most likely include a mix of steep budget cuts and a series of elements that under I-960 would require a two-thirds vote of both chambers — new taxes, clarifications of legislative intent following a court ruling, certain fund shifts and the closure of corporate tax loopholes. These include tax breaks for banks making foreclosure sales, some out-of-state businesses doing business in Washington and transportation companies shipping goods across our borders.



None of those solutions could be implemented without suspending I-960, because it would be subject to the two-thirds vote requirement.



No new taxes have been voted on yet. Instead, the Legislature has focused on enacting cuts as legislative leaders promised to do. But temporarily suspending I-960 allows us to address our revenue deficit with an array of sustainable solutions. This will help ensure classrooms aren’t overcrowded, the gates aren’t closed to a college education, the needy and disabled won’t go without care, and the working poor won’t lose their health insurance.


Thanks again for your e-mail.


Yours truly,


Adam

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Anyone else get the same response?

I find it really hard to believe he has 90% support on his decision to support this.


.....and the beat rolls on. No Introspection evident by any legislator on how their spending habits continue to add to the problem.

I didn't vote for I-960, but it was made into law. If the house and legislature decides to put aside the will of the people, then I think is need to ask them to set aside the bear/cougar hound/bait initiative.

Please don't continue to vote for ass clowns people.

The recent passage of virtually every school levy this week shows me that the folks aren't against paying taxes or funding things/programs that are vital. However, I also think that the good folks down in Olympia have lost their way and the purpose of I-960 was to send them a message that they needed to reign in their spending, not wait two years and suspend it. I have a really hard time thinking they have a clue when they float ideas such as a tax based on the engine displacement of your vehicle as was proposed a year or two ago.

I think the motivation for agencies assisting non-profits like Audubon to buy up land is to provide habitat areas that won't end up like Capitol Forest.

Filled with trash, poached clean, and crawling with squatting tweekers.

I used to camp in some 'all access' WDFW lands and after a few short years the places were mudpits from 4x4'ers and ATV'ers, the signs were swiss-cheesed with bullet holes, and what trees weren't hacked down for firewood looked like the day after Halloween on a college campus with all the poopy toilet paper and Busch Light cans strewn around them.

Those places are all now gated.

Sky Guy:

The response you received appears to be canned, which would be very typical of a response from a legislator (or rather from his/her aide) regarding a hot, current issue. If he actually did sit down and write out that whole reply for your individual benefit, however, I would commend him on his regard for his constituents.

Like you, I have a very hard time believing the numbers provided for constituent opinion on the initiative. A slight majority in favor of suspending the initiative would be more believable, but I would doubt even that, given the average citizen's tendency (no matter what district you live in) to support anything that keeps more money in his/her pocket now, regardless of potential future ramifications.


All:

This is a great thread. Like Sg, I have been duly impressed by the wealth of knowledge (or well-substantiated opinions) on these matters to be found in this user group. It has been highly refreshing to read first-hand accounts of how the mortgage crisis has played out in financial institutions, and somewhat satisfying to learn that my estimations have not been far off base. As hard as it is to get confirmation of many of my darkest fears (as well as a few new concerns as well), it is great to see people discussing these issues so passionately and with such intelligence. It gives me hope that the apathetic stupor to which our government has driven the masses may be giving way to a more enlightened and appropriately angry mentality. In my opinion, that may be our best hope for a restored government by the people, for the people, and yes, a reason to vote.

Now they are talking about an across the board "temporary" Sales Tax increase of 1%.

Apparantly they are going to attempt to tax "our" way out of the economic disaster that this state is in.......

Reminds me of the saying .....trying to get blood from a turnip......

When was the last time a tax increase was "temporary"?

In this State...... never.

Our politicians in Olympia just don't get it.

Depressed economy and high unemployment rate....make sense..RAISE TAXES.... that should fix everything..........NOT.

Not quite...... + a billion DOLLARS....or two.....or three

Good post by you here. Took me back a bit and reminded me very much of the awakening that took place within the industry in late 2007. That carried over with a small group in the 2008 elections and is now becoming widespread. It remiains to be seen if people will wake up to the fraud or not as it's a complicated subject for many. I for one, remain optimistic.