As IF Times

link Harry Reid: “I dont know how anyone of Hispanic heritage could be a Republican.” | The Weekly Standard.

If you think about this sentiment, you will see the embedded racism within.  An organization that professes to be the party of the people transparently exposes itself to be essentially a union shop.  If you extrapolated Mr. Reid’s logic, you’d have to include numerous other groups in society that could not possibly be Republican.  If we make a list of the vocal groups that regularly protest any activity seen to be hostile to their way of life and which can be blamed on Republican policies, they would include: Entertainers, gays, women, union members, blacks, drug dealers, young people, the poor, immigrants legal and illegal, Muslims, Jews, Atheists, Asians, environmentalists, academics, animal rights activists, abortionists, non-gun owners and of course the aforementioned Hispanics. 

Crunching the numbers over the entire U.S. population, this leaves only Donald Trump and 5 other guys who could be Republican.  Truly amazing then that the GOP can ever get elected given this small fan base.  Of course there is a possibility that individual members of the listed demographic groups don’t subscribe to the policies of the Democratic party and instead choose to think for themselves and identify more with the principles of the GOP.  It’s possible that some may be insulted at being lumped into some amorphous group and then pandered to by Democratic “leaders” like Reid.  While there may be appeal to some groups to have their interests championed at first, the bigger consequence is the balkanization of the country which leads to the divisiveness that the Dems always accuse the GOP of promoting.  As we have discussed in previous comments, people are naturally tribal and will join a mob given the right circumstances. 

Politics in the U.S. has evolved into a game of identifying a unique demographic slice and then to claim discrimination  by the larger group of society. Weak minds fall for the political call to action and voila, a new oppressed subgroup is formed to be organized, plied for political donations and worked for influence.  Essentially a union local is created.

A guy like Reid would be far more useful leading the charge for a college football team where his rants can actually be useful and in fact encouraged.  The ‘Us’ and “Them” ideology works great in the sports arena;  there it’s healthy, in politics not so much.

link Book Review: The Big Short – WSJ.com.

Back in early March, I wrote a comment on Michael Lewis’ new book, The Big Short, based on an excerpt printed in the WSJ.  Since then, I’ve been able to read the book itself as well as watch an interview with the author on the ramifications of his story.  For professionals and laypeople alike, Lewis is able to describe the environment and characters involved with the banking debacle in both an understandable and interesting way.  One of the main themes of the book is that despite the size of the bets being made via very complex financial derivatives tied to sub prime lending in the mortgage market, very few people, certainly not the heads of the major investment firms creating these toxic products, truly understood the nature and scale of the bets. 

I’m certain that as understanding of the scale and depth of the con (and that’s what it was, a con), is digested by people in government who would care about such activity, the backlash will be massive against Wall Street.  It will also be interesting that since the present administration is Democratically controlled in both houses, how they will spin the outrage against the banks.  Why? Because the very roots of the crisis began with players with links to the Democratic party.  Recall that individuals in top government finance positions were also heads of the big investment firms responsible for the creation and expansion of these toxic products, notably those at Goldman Sachs.  Interestingly, top level positions at Goldman Sachs seems to be a requisite stepping stone to government service.  Former treasury secretary Robert Rubin is an obvious example as is ex New Jersey governor John Corzine.  Let us not forget present alumni of Goldman Sachs, Tim Geithner and Henry Paulson who are charged with regulating and cleaning up the mess essentially created by their old firm. Kind of like asking the wolves to solve the problem of disappearing sheep.

Let us also not forget that the entire idea of creating a market for subprime loans to unqualified home buyers began with a “good intentioned” program initiated by Democrats during the Clinton administration to allow more people to jump into the homeownership market under  The Community Reinvestment Act in 1994.  History will show that with Democratic pressuring by such as Barney Frank, Chris Dodd,  Andrew Cuomo and many of the administration, banks were legally compelled to make loans available to home purchasers not otherwise eligible, under duress of fines.  Goldman and the other wall street firms then came along to create financial instruments based on the ballooning sum of dubious credit quality loans.  To be sure, the repeal of Glass Stegall also enabled banks to assume these outsized risks, but that will be the topic of another piece.

Ironically, the interview that Lewis gives about his book includes some snide jabs at Republicans as they were being made aware of the scope of the con.  Undoubtedly, when you are employed by Vanity Fair, you are required to toss in the obligatory partisan dig.  We can forgive him for that, since you have to please your friends and employers.  But if the Republicans are outraged by what has happened, it doesn’t say much about the other side, who, either don’t appreciate the scale of stupidity involved or who were complicit.  Based on Lewis’ own work, I’d say it was a lot of both.