Oh, Hillary. We know how it is. You've worked too hard, stayed too scrappy. You made amends with the vast right wing conspiracy and pulled some tale from your ass about sniper fire raining down on you and just told America John McCain would lead the nation into nothing less than the Great Depression... You got Chelsea to corroborate the sniper story. Chelsea, the pretty girl you got some pundit nearly fired for suggesting you were "pimping out." That was before you got some Obama aide actually fired for calling you a "monster." You could probably get Sinbad himself fired; you're that tough. And tough is what it takes. So anyway, good luck with this "Tonya Harding Option" thing. I mean, first root out whatever classist, misogynist inbred swamp thing called it the "Tonya Harding Option" to begin with. But the nomination has to be yours, right? Ugh, whatever. So yeah, Glamocracy Megan and I talk macroeconomics and figure skating and more Meghan McCain in a truly "dismal" (heh) Crappy Hour.
MEGAN: So, I was super curious about your take on McCain's speech on the economy. When he got to the part where he wants to let investors who bid up properties swing, I'm not going to pretend I wasn't nodding along.
MOE: Ugh, Hillary Clinton, arguably referring to John McCain's plan as Herbert Hooverism is not so different from referring to your husband's repeated questioning of Obama's patriotism as McCarthyism, except, you know, that you did it yourself, and that Herbert Hoover's policies left people to actually, like, starve, which I think is a little extreme.
MEGAN: Do most people really know who Herbert Hoover is or like, even better, why he sucked? I mean, I don't want to insult the American electorate but I'd bet if I went somewhere outside of D.C., it would be pretty damn hit and miss.
MOE: I mean, here's the thing. From a personal perspective I think, well, I know my parents have refinanced like 75 times. And my parents are neither uninformed nor really financially struggling, they just don't have the best balance sheets. A deep fallout in the housing market is psychologically impactful because that's everyone's nest egg, their real sense of How Things Are. But a redefined sense of How Things Are is ... inevitable? Desirable, even? And in terms of decent hardworking Americans etc. etc. how many people who have bought houses at three or four times the price to rent ratio not because they are greedy but because they desire the sort of security that renegotiating a lease every year cannot afford us? If people buy homes in the pursuit of security, it's not a bad idea to allow prices to fall. It seems like the answer lies with programs like this one in Baltimore that help people renegotiate their mortgages with these much-strapped lenders. But I'd need to see the numbers. The struggle is just that the federal intervention in cases like this disproportionately helps the wealthy and the financial institutions, and the only reason they are important is because they are the custodians of the market sentiment ergo the liquidity ergo the percentage GDP contraction. Ha ha ha I just said "ergo" in the Crappy Hour. Anyway, it's frustrating. But back to easy target. Just what percentage of Americans were homeowners during the Hoover administration again? I'd have to think it is hardly comparable to the present day.
MEGAN: Wow, ask and ye shall receive. About 2/3s of America households are homeowners in 2000 compared to 50% in 1930.
MOE: Well that is a very high number for 1930. I wonder what the price to rent ratio was back then, and that of the average cost of a house compared to the per capita GDP, and how big the average household was, and the size of the mortgages etc.
MEGAN: Also, by the way, in 1930 the places with the lowest ownership rates were in the South, and many of those states (Mississippi, Alabama, South Carolina) have higher-than-average ownership rates today.
MOE: What is more, I wonder if anyone could forsee a time when funeral parlors were targets for gun violence. Because that's what I read on the front page of the WSJ today and it was a lot more depressing to me than this stock market news.
MEGAN: D.C., lacking statehood, does not. Ahem.
MOE: This is an interesting story on the wave of foreclosures triggering a whole new round of speculation.
In some beaten-down markets, the price cuts have been stark. The Detroit Board of Realtors recently found that home sales in the city (excluding suburbs) in the first two months of this year jumped 48% from a year earlier, to 1,540. The average home price there sank 54% to about $22,000.
Guess it's as good a time as any to buy in Detroit. HEH.
Here's another idea: we're just reverting to the mean.
MEGAN: It always struck me how stupid it is of the banks in many cases to let go of properties for far less than the mortgage is for, but part of that seems to be none of them are actually in the area/care about their customers. For instance, one of my close friends was negotiating a couple years ago with an owner facing foreclosure and offered less than the supposed appraised value and the bank wouldn't accept it. So the bank foreclosed, she went to buy it at auction and paid another $50K less for it in the end. Of course, the bank people were all in Jersey or something so they didn't realize the market here was already sliding and didn't see any point to negotiating. The fact that the government has to step in and possibly lecture banks and force them to realize its in their own long-term best interests not to foreclose on the world is so fucked up. But I guess foreclosing raises share prices in the short term and there's always a golden parachute waiting for next quarter's earnings report.
MOE: You just said my favorite three words: LONG TERM INTEREST. The American economy has no sense of its long term interest. Companies are always talking about how...being Green! Opening departments dedicated to Corporate Social Responsibility! ... is in their "long term interest." Give me a break, guys, we live in the ADD Dynasty. No executive or director with any sort of authority over these things gives a shit about any term of time past the point at which their options vest. Most of them aren't thinking much more than a fiscal year or quarter ahead. That is the problem with the market and the economy at large. It can be sooo profitable to milk some short-term legislative loophole, short term investor sentiment, short-term arbitrage possibility, that it becomes quaint to even say the words "long term." And by the way, now we should probably talk about something els.
MEGAN: Oh, right, everyone hates when we geek out on economics, except when they don't.
MOE: Oh god, but to this end, Clear Channel is collapsing. Clear Channel, the representation of how then ruthless pursuit of short term shareholder value under the guise of long term strategy rendered the American music industry completely banal in a tiny space of time...
Richard Mellon Scaife. Why is this story at the top of Memeorandum?
MEGAN: Wow, he looks like a creepy dude. How befitting.
MOE: Side note: Libby Copeland of the Wash Post was less enamored of Meghan McCain than GQ. That said, she seemed much cagier and less charming in this story, and maybe that's because she was.
MEGAN: Maybe she killed his cats.
Er, I meant Hillary, not Meghan. Yeah, Libby's piece was much less puffy than the GQ one, much more focused on her use of the word "like" and her fashion sense. Not like I do that alot or anything, and I would never focus on someone's sartorial choices, like, ever.
MOE: And there is Obama adviser McPeak McSpeaking again, this time pissing off the Jews. (Last time it was the Clintons.) Fun!
Is it another slow day? Because I was thinking last night before I went to bed it wasn't going to be as bad a day as yesterday.
OH, shit, I know what I wanted to talk about!
MEGAN: Hey, I have to say, I take exception to the line in that McPeak article that conflates his love of the booze and his hate of the Jews. I love booze and don't hate Jews.
I also don't blame them for the failings of American foreign policy.
MOE: The Tonya Harding option. Gore as Oksana!
MEGAN: Stop blaming the alcohol! Alcohol doesn't make people anti-Semites, it just makes them stupid enough to talk about it.
OMG, you just make me think of Al Gore in a little white skating costume!
Excuse me while I go rinse the taste of bile from my mouth.
MOE: Apparently the new T-shirt is "No drama, vote Obama."
But is the drama actually helping the Democratic Party?