Obama Announces He Will Ignore Congress – Bailouts Coming

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“I Have An Obligation As President To Do What I Can Without” Congress.

~ Barack Obama

“I Have An Obligation As President To Do What I Can Without” Congress. But when Congress refuses to act, and as a result, hurts our economy and puts our people at risk, then I have an obligation as President to do what I can without them. (Applause.) I’ve got an obligation to act on behalf of the American people. And I’m not going to stand by while a minority in the Senate puts party ideology ahead of the people that we were elected to serve. (Applause.) Not with so much at stake, not at this make-or-break moment for middle-class Americans. We’re not going to let that happen. (Applause.) Read here: Real Clear Politics, It’s Real Clear Alright

Who are these people applauding the loss of our freedom and of our Constitutional rights? They need to go back to school.

This is a completely lawless President, where is the outrage?

Here is the latest – Obama is likely planning a massive multi-trillion dollar refinancing program of mortgages. This would be done without the approval of Congress and would hand Obama the election. In the end, it would result in a housing bubble that will destroy the economy, but that will come after the election and people won’t know what happened to them as it all comes crashing around them.

Take a look at the reasoning from James Pethokoukis at The Amercian –

This could be just the beginning. If President Barack Obama’s legally dodgy appointment of Richard Cordray to head the consumer finance agency should stick, it may open the door to more such actions. Here’s Jaret Seiberg of the Washington Research Group:

To us, the most important takeaway from a recess appointment of Cordray is that the President could use this same maneuver to put a housing advocate in charge of FHFA.

And why is that important? The Federal Housing Finance Agency is the regulator and conservator of Fannie Mae and Freddie Mac. And the FHFA currently has an acting director, Edward DeMarco. If Obama replaces him with a “housing advocate” via the same recess appointment process, here’s what might happen next, according to Seiberg:

That could lead to a mass refinancing program for agency-backed mortgages that would go well beyond the existing HARP program. That could hurt agency MBS pricing and result in higher financing costs going forward. Yet it also could be a big boost for the economy and housing going into the election.

(Editor’s note – I wrote an article on Mr. DeMarco. This is no joke. Mr. DeMarco is being battered and abused by the Obama WH as he tries to protect the American taxpayer. Read here: This man is a hero)

Indeed, my sources tell me the Obama administration has been eager to implement just such a plan, but needs to have its own man heading the FHFA to make it happen. The plan would be modeled after one originally devised by Columbia University economists Glenn Hubbard (a campaign adviser to Mitt Romney and AEI visiting scholar) and Christopher Mayer. In recent congressional testimony, Mayer described how the mass refinancing plan would work:

Under our plan, every homeowner with a GSE mortgage can refinance his or her mortgage with a new mortgage at a current fixed of 4.20 percent or less. … To qualify, the homeowner must be current on his or her mortgage or become so for at least three months. … Other than being current, we would impose no other qualification or application, except for the intention to accept the new rate (that is, no appraisal, no income verification, no tax returns, etc.).

Mayer estimates that some $3.7 trillion of mortgages would be refinanced. That’s right, this would be the Mother of All Mortgage Refinancing Plans. It would help roughly 30 million borrowers save $75 billion to $80 billion a year. As Mayer puts it: “This plan would function like a long-­lasting tax cut for these 25 or 30 million American families.”

On his website, Hubbard says the plan would have an immediate fixed cost to the government of $121 billion $242 billion with half that cost split equally between the government and lenders. And he calculates the economic impact as follows:

1. We estimate that 72 percent of owner occupant homeowners would be eligible to refinance at no cost to them. Their monthly mortgage payments would fall by an average of $355, for a total national fiscal injection $7.1 billion each month.

2. The typical borrower would reduce his or her principal and interest payments by about $350 dollars, a total reduction in mortgage payments of nearly $100 billion per year.

3. The macroeconomic stimulus effect should also include an additional housing wealth effect. At the low end of our estimates, improved mortgage market operations would reduce house price declines by 10 percent. With an estimated aggregate housing valuation of about $18 trillion, housing wealth would increase about $1.8 trillion relative to what it might fall to without this program. If we assume a relatively low marginal propensity to consume out of housing wealth of 3.5 percent, U.S. consumption would rise by $63 billion relative to what would otherwise have occurred.

4. Combining these estimates gives a total macroeconomic stimulus of $118 billion per year in lower mortgage payments and any new consumer spending due to a housing wealth effect. In addition to the direct macroeconomic stimulus, jump-starting the stalled housing market will increase employment in a variety of industries that depend on housing transactions (mortgage and real estate brokers, home supply companies, moving companies, etc.) as well as increase the efficiency of the labor market by reducing impediments to households moving to take another job.

This will hardly be the end of the spending. Obama has a plan in the works for passing more student college loan indebtedness to the taxpayer. Think about it. Every single crazy thing he has tried to get passed will be put through now that he has proclaimed his independence of Congress. Obama appointed Cordray as a recess appointment when the Senate was not even in recess. He does whatever he wants. He needs to be impeached. This is not a dictatorship. We must stop this.

 

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