Outrage of the Day

[peterwho]

Edwards Linked to Subprime Foreclosures

Presidential candidate's holdings in Fortress are invested in subprime lenders foreclosing on Katrina victims - report.
August 17 2007: 4:18 AM EDT

LONDON (CNNMoney.com) -- Democratic presidential contender John Edwards has investing ties to subprime lenders who are foreclosing on victims of Katrina, according to a report published Friday.

The Wall Street Journal said there are 34 homes in New Orleans that face foreclosure from the subprime unit of Fortress Investment Group. Edwards has about $16 million in Fortress (Charts), a hedge fund and private equity manager, the newspaper said.

Edwards, the former senator from North Carolina, has been a vocal critic of subprime lenders and told the Journal that he would assist homeowners in New Orleans who face foreclosure from businesses linked to Fortress or who have already lost their homes.

"I intend to help these people," he told the newspaper. The report also said he would divest any Fortress funds in his portfolio that are invested in subprime lenders that filed the foreclosures. "I will not have my family's money invested in these firms," the Journal quoted him as saying.

Rising defaults among subprime mortgages - those home loans given to borrowers with the weakest credit records - has triggered a credit crunch and resulted in a wave of foreclosures.

http://money.cnn.com/2007/08/17/news/economy/edwards_fortress/index.htm?postversion=2007081704

Why isn't this front-page news?

P.S. Didn't he announce his candidacy in New Orleans?

[Jana]

First, until someone did some digging around, it probably wasn't obvious that the hedge fund held securities specifically for these folks. Owning a subprime stock is not a sin, offering a subprime loan is not a sin, the problem lay with the managers of these funds deciding to buy these bonds without better objective controls scrutinizing the viability of these loans over the long term.

No investor would have access to specific loans, to determine if they are viable. I don't think John deserves this criticism, but he did sort of bring it on by making political hay out of the sub prime issue. .

[StrykerFSU]

You see it time and again, some politician is invested in some horrible "big corporation". The global change deniers did the same thing to the "rock stars" at Live Earth, i.e. Madonna owning Alcoa stock. Usually I just dismiss these reports as grandstanding by one side or another because the celebrity in question is almost certainly cluless as to how their money is being managed.

However, in the case of Edwards stories like this are especially harmful. This is a lawyer who once claimed to be in psychic contact with a dead child in a courtroom so his credibility is already a bit suspest. More importantly a huge part of his campaign, besides trying to out-Left just about everyone, is this idea of "Two Americas". He wants to be the champion of the poor to the detriment of the rich (people makeing over $100,000 I presume) but has the small problem that he has become exceedingly wealthy from suing doctors to the point that he is flying his personal hairstylist around the country to give him $400 haircuts. So to be invested in a company that is at this very moment foreclosing on poor people who were victims of a natural disaster doesn't exactly jive with the core principle of his campaign.

The Tuesday Morning Quarterback, Gregg Eaterbrook, recently posted his AFC preview and in it had a nice discussion of why hedge funds are a bad investment.

[Jana]

the haircut thing is a red herring - the barber is charging not only for the cut, but for having to spend 2 whole days flying back and forth to reach Edwards.

The real shame in campaigns is not haircut prices, it's the billions spent on radio and TV advertising, which I seriously doubt change anybody's mind. The billing fees for all the political consultants, wardrobe specialists, bus drivers and "fixers" (like Karl Rove) far exceed $400.

[Zeuslax]

The real shame in campaigns is not haircut prices, it's the billions spent on radio and TV advertising, which I seriously doubt change anybody's mind. The billing fees for all the political consultants, wardrobe specialists, bus drivers and "fixers" (like Karl Rove) far exceed $400.

good post and good point!

[JW]

The real shame in campaigns is not haircut prices, it's the billions spent on radio and TV advertising, which I seriously doubt change anybody's mind. The billing fees for all the political consultants, wardrobe specialists, bus drivers and "fixers" (like Karl Rove) far exceed $400.

good post and good point!

agreed.

And think also of all the money that has been spent to "ROCK the VOTE" by MTV and the likes of Puff Daddy over the years appealing to the younger crowd. The problem with this is that the voting public was not in their demographic.

I think that the issues with this country are much more evident leading up to an election. I believe that the divisiveness in this country is hurting this country more and more every year till now nothing really gets accomplished by our government.

I don't know, maybe just a perception.

[TexOle]

Rock the Vote was fun. They had a ton of free stuff. It creates a lot of buzz on campuses about voting, and I think it did increase voter turnout. My problem with Rock the Vote is that it never seemed to present any issues. It was just an event to register to vote and get free stuff.

My favorite are the college students that vote either red or blue, and have no clue why they are voting for someone other than political party. I cannot tell you how many people I have met who pick a leader for some strange reason, but I have to remember that Hank Hill had a problem with Bush and his weak handshake.

[StrykerFSU]

Since we got to talking about the money spent to get a guy elected what about Federal money going to guys who are no longer President?

Wealthy ex-presidents reach into your pockets:
Recently, the Congressional Research Service announced the federal subsidies requested for the coming fiscal year by ex-presidents Jimmy Carter, George Herbert Walker Bush and Bill Clinton. Globe-trotting Carter asked for only $2,000 for travel; Bush and Clinton, both millionaires, wanted $50,000 from taxpayers for travel. Bush said he needed $69,000 for "equipment" and $13,000 for postage. Is Bush planning to mail 32,000 thank-you notes next year?

What's really offensive is that all three filed for the maximum presidential retirement payment of $191,000 annually. All these guys are wealthy, the elder George Bush having significant inherited wealth, yet all want taxpayers to hand them pensions seven times higher than the typical Social Security sum. This is extra galling because Carter and Clinton aren't even retired! Carter continues to write books that sell well; Clinton is active on the corporate speaking circuit, having earned an estimated $10 million speechifying in 2006. Clinton prattles on and on about the horrors of inequality, yet demands $191,000 in bonuses from taxpayers whose median household income is about 1/20th of his estimated $10 million. Why didn't the three ex-presidents request no pension at all? That would have been the dignified thing to do.

To top it off, Clinton requested $79,000 for telephone service. It is impossible, physically impossible, to spend $79,000 on telephones! If Clinton had a 10-cents-a-minute long-distance plan, he could talk long-distance 24 hours a day, 365 days per year -- and you can imagine Clinton doing this -- yet fail to burn through $79,000. The most expensive package offered by Verizon Wireless is an international super-phone with unlimited texting and four hours of talk time daily; this sells for about $3,000 per year. Clinton could purchase two dozen of the most expensive cell accounts available in the United States for the tax-subsidized telephone budget he requested. Is Clinton's $79,000 phone request fraud, or is Clinton planning to use the money to buy phones for staffers working on his private speaking business? An ex-president who had financial problems might legitimately turn to the taxpayer. For all three living ex-presidents to be quite wealthy yet demanding public subsidies is shameful -- to say nothing of a failure of leadership.

http://sports.espn.go.com/espn/page2/story?page=easterbrookpreview/070821&sportCat=nfl

[Grant Neeley]

Heard an interesting story from a friend last night. One of her students worked for Clinton this summer - he was having trouble with his cell phone in Africa. Called the intern at 2 am, told him to call the AT&T president and tell him about the trouble.
Problem solved.
Trans-Atlantic troubleshooting costs a little.

[KnoxVegas]

Don't forget congress's benefits:

http://usgovinfo.about.com/library/weekly/aa031200a.htm


Ten Things Your Politician Won't Tell You

3. "HMO? Can't say I ever tried one..."
If congressmen seem hesitant about enacting health care reform, you can partly blame the comfy health benefits they enjoy. The Federal Employees Health Benefits Program covers approximately 9 million government workers and dependents, with generous provisions that typically can't be found in the private sector.

Under the Fair Share provision that took effect in 1999, for instance, taxpayers pay 75 percent of the total premium for whatever plan a politician selects. In addition, for an annual fee of as little as $350, lawmakers enjoy free lab tests and clinical work at the Attending Physician's Office — a collection of area clinics. They also get exclusive outpatient care at the Walter Reed Army and Bethesda Naval hospitals for what Hill watchdogs say is a fraction of the real cost.

"It's as if Congress has removed itself from the real-world consequences of what they're debating for the rest of us," says Pete Sepp of the National Taxpayers Union. "The changes they make on HMOs or a prescription drug benefit won't [even] apply to them."

http://www.smartmoney.com/consumer/index.cfm?story=tenthings-november02

[Zeuslax]

One of my favorite episodes of Alien Nation (before Michael Moore became very one sided politically speaking) was when he got all dressed up in 70's workout gear and went to the capital to work out in the Congressional gym. Of course he didn't work out or get through the front door. Basically he was using this as an example to outline that the Congress' (our employees) benefits far exceed most Americans. If I remember correctly he was also mocking Walker's and Newt's contract with America. One of the primary bullets of the contract stated that all laws and benefits provided to Congress would apply to the rest of the country as well.