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BitaTruble -> RE: Freddie and Fannie (10/13/2008 1:50:39 AM)
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quote:
ORIGINAL: Kirata
To be honest, though, giving credit where due, in your case I do take you seriously. I know you well enough (from reading) to have the feeling that there is likely merit in what you say, even if I might not wholly agree with your interpretation of the testimony in all respects.
As for me being Gorean, when Goreans argue points of philosophy they present quotes from the books to support their contentions. I'm just asking for the same. If you want to be Gorean, then yes you need to read the books in full. But I don't want to be a Congressman.
Be well,
Kirata
Thank you, Kirata for the compliment and the opportunity to present my skepticism of the video presentation.
Starting on page 151 of the appendix is the statement of William Lacy Clay.
"Mr. Chairman. We do not normally hold hearings on matters before other investigations are complete."
"There are other stages of this process that take place before judgement is rendered. Why circumvent the process? Why this hearing?"
"Why can't we let the SEC decide this issue? Why rush past them?"
"This hearing is about the political lynching of Franklin Raines. (The bold is the sound bite presented in the video.) We have seen this happen too many times before. We are to go out of session and the deed is done before the election. Why can't we just say this is the agenda. Let us debate that issue on it's own merit. Better still, let due-process take it's course then let the chips fall where they may."
As you said, there is going to be interpretation of the documentation. My interpretation is that Mr. Clay is someone who seeks to gather all the facts so that the appropriate body (in this case the SEC) can make a knowledgable decision and if those facts support the culpability of Mr. Raines, then so be it.
Or Page 1, Mr. Baker:
"Although not intended to fuel the effort to bring about regulatory reform, the analysis makes it clear that more resources must be brought to bear to ensure the highest standards of conduct are not only required, but more importantly, that they are met."
The video clearly shows Mr. Baker calling for regulatory reform, but his own statement here, shows that was not the intention of the hearing at all.
Page 6, Mr. Frank:
"I believe we were well on the way (...) to putting together a bill that would have enhanced the regulator and passed. What stopped the bill was the Bush administration's determination to go beyond safety and soundness into provisions which would have restricted the housing function."
"If they were to have dropped that, we would have had a law already signed because on the question of safety and soundness regulation, there has not been significant dispute."
"... I am concerned about the regulator having safety and soundness power but not general powers."
Again, this does not sound to me like someone who wants to block passage of regulatory legislation, but does desire to limit the powers a single entity may hold in regard to functionality. Mr. Frank, in that same passage goes on to speak about manufactured housing which I believe illustrates his point quite well and should give pause to how far any particular branch should be allowed to go outside their jurisdiction. Clearly, this is an SEC issue and would, in fact, fall outside the jurisdiction of the Subcomittee. How can the subcommittee ever be expected to pass legislation which takes the power away from the Securities and Exchange Commission and puts it into the hands of a congressional oversite committee who would not have the knowledge to actually oversee such regulations? It's akin to asking an English teacher to grade the course work of a physics class. It's weighty stuff and if someone's not specifically trained in it they would not be able to assign a proper grade. I didn't get any sense of that from the soundbite in the video and it's so important in the context of what Mr. Frank is saying.
Page 190: Materials submitted by Mr. Frank from Merrill Lynch - I'm not going to quote the whole thing here as it's quite long and this post is simply to point out where the allegations in the video are faulty and disingenious. On one hand you've got the report by Ofheo and on the other you have a report by Merrill Lynch. Sort of a he said/she said scenario. Conflicting interpretations on what actually transpired. I point this out merely to support the evidence that there are members of the committee who are portrayed as attempting to block passage of legislation but who, in point of fact, were really trying to gather all the information they could before setting into motion something which might have the propensity to grate on the nerves of capitalists .. 1. That the government would set into place regulatory legislation without due process and without full disclosure when it is clear that they didn't know which side to take, who was telling the truth about which issues and which many members felt was not theirs to oversee in the first place and 2. That the government would set into place regulatory legislation then place oversite of that legislation into the an oversite committee rather than in the hands of the SEC where it rightfully belongs. It is my belief that Mr. Frank and the other members (some democrats and other republican) had the desire for the regulations but wanted to make sure that it was in it's proper place.
Again, that's not the sense I got from the video. I will stipulate this is my interpretion of the available documentation at that time. That said, it seems like common sense to me to want all the information you can get before making any decision on these very complex issues.
Page 77: Mr. Howard, Vice Chair, CFO, FNMA -
"We filed financial statements with the SEC which were fully audited by KMPG. (my note: KMPG is an accounting firm along the lines of Deloitte & Touche) and as Frank said, FNMA has not withdrawn those financial statements and KPMG has not withdrawn it's opinion that FNMA was consistant with GAAP in all material respects."
So, now we have the CFO of FNMA giving sworn testimony to the body that another accounting firm disagreed with the findings of Ofheo. Another example of he said/she said. Yet, the video would have us believe that the members should then take a hardline approach and arbitrarily discount such statements even though the SEC was already in possession of FNMA documentation. The video seems to present that the members of the body should have engaged in a witch hunt .. or rather, would have presented such if all the statements were presented in their true context which was, the members at that time and in those circumstances, did not know the truth of the matter. Which firm was to be believed? Merrill Lynch? OFHEO? KPMG? Deloitte & Touche? My interpretation is that the body wanted to find out before taking action which they could not have known would have been justified or not.
As I have already noted, I find the accounting firm of Deloitte and Touche to be fair and unbiased. I believe the findings by the regulator to be accurate and FNMA was obviously engaging in practices which were dubious and probably criminal and that the article submitted by Merrill Lynch was prejudicial in nature. We know that now .. but.. they didn't know it then and that's the difference. What I don't see and what the video offers is that the hearing members were in any way, shape or form, faulty in their processes or partician in their decisions. I'm not saying that the hearing members are saints or sinners .. just that they did what they were supposed to do at that time. What they may or should have done at a later date is fodder for another thread.
I hope these examples which I've presented adequately answer as to why I found the video to be aggregiously disingenious. With 455 pages from which to choose, I could present several other examples, but this should suffice for the purpose of this discussion.
Gawds.. I'm such a nerd. ::chuckles::
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