Congressional Oversight Panel says the government overpaid

Kannon Fodder

No surprise here – “The Congressional Oversight Panel says the government overpaid”

Elizabeth Warren, the head of the oversight panel called the process “… an opaque process at best.”

(Warning! Incoming Sarcasm) Who could have seen this coming?

The Kannon did – read his October post:

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Kannoneer Returns Fire on Ford Motors

We recently posted an article that ruffled a few feathers and solicited a response from Scott Monty in Global Digital Communications for Ford Motor Company.

The following was in response to the Kannon Fodder post “Superbowl Advertising – GM, Chrysler and Ford are missing the point”

We here at the Kannon Team would like to thank you for responding to our post – Ford is doing the right thing by monitoring influential blogs – kudos to you!

Yes, we will concede the point that Ford has yet to take bailout money – but the point about transparency in advertising is still valid – now is not the time for the same old hyperbole. Really, does anyone really believe this is my “last chance to save?”

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Are we ready for Economic Darwinism?

Kannon Fodder:

“…what America is living through now is a drastic and high-speed wave of Darwinism that reaches every corner of the economy and financial system. We’re on failure overload – which is why this all feels so frightening and why markets remain in disarray.  … more failure that the economy must digest, when it’s already choking on the first huge lot of it in this recession.”

Tom Petruno points this out in an op-ed piece in the Baltimore Sun.

Superbowl Advertising – GM, Chrysler and Ford are missing the point

Kannon Fodder:

It’s been noted in virtually every newspaper and online resource that the American car companies are not advertising in the Super Bowl, for example, this article in the Baltimore Sun.

The argument is that it would appear tacky to spend $3 million for one thirty second ad when they just got a sweet handout from Uncle Sam.

The Kannon Fodder team thinks it is what you advertise that is tacky – not where you advertise it. Just the other night, one ot the team saw a Ford as that shouted “THIS IS YOUR LAST CHANCE TO BUY AT EMPLOYEE PRICES. PRICES WILL NEVER BE THIS LOW.”

Bull Crap. We don’t believe that, you don’t believe it, the dealers don’t believe it. No one does.

What we need now is some honesty – and some transparency. Step forward and be the first manufacturer to say:

“Please go to Consumer Reports or our own website to download the dealer invoice. You’ll see exactly the price our dealers are paying for these cars. We pledge to you that this is the lowest we can sell them for to still be able to pay back the money we borrowed from you, the tax payer.

We’ve instructed our dealers to charge you no more than $500 more than this price. If they try to play games, find a dealer who will treat you fairly.

We’re all in this together. “

That Ad would sell cars. If that ad was on the Super Bowl, and the manufacturers really followed through and stopped playing games, and the dealerships stopped doing business as usual, people might start trusting again.

Not running an ad in the most viewed event this year is just playing more games.

Yes, China’s Broken, So It Can’t Fix Us

Let’s connect the theme I was planning to write about this morning with the Kannon Fodder post below, which refers to the troubles the Chinese economy is going through:

from The Wall Street Journal
Jan. 28, 2009

The Federal Reserve, unable to lower rates further, said it is prepared to purchase long-term Treasurys in order to keep rates low. “The economy has weakened further,” the Federal Open Market Committee said, adding that conditions “are likely to warrant exceptionally low levels” on fed funds “for some time.”

The US Government is making Bernie Madoff look like a penny ante operator.

China’s been providing bailout funds for the United States, in the form of buying ever lower yielding T-Bills, for some time now. They control enough dollars that they can flush our currency down the devaluation toilet in one fell swoop if they choose to. But since our Wal-Mart dependence is still alive and well, they’ve held off precipitating a steeper devaluation of the currency they get paid in for their melamine tainted milk products and lead imbued children’s toys.

However, in as global an example as there is of the credit crunch/crisis, China and other foreign supporters of the US Dollar, and therefore the US economy, are cutting back on extending credit to us, in the form of cutting back on buying our government’s bills and bonds.

So our nifty solution is to print more dollars with which to buy our own debt. If you can’t get your head around this, it’s because there’s nothing there to get your head around. It may not quite be a Ponzi scheme, but it’s an attempt to stave off inevitable pain by attempting to prop up something (the US economy) with nothing but the Emperor’s new dollars.

We have somehow become both the con artist and the mark.

Postscript: Headline in this morning’s WSJ reads: “Chinese Premier Blames Recession on U.S. Actions”. Laying the groundwork, methinks, to a more severe reduction in supporting our credit habit. Chinese money was the blood flowing through our of house of cards economic system. A case of financial anemia is the prognosis. LK

Advice to the new FCC Chair

Kannon Fodder

The Minneapolis Star Tribune gives some advice to Julius Genachowski, our new FCC Chair and the man behind Obama’s masterful use of technology. It’s an insightful, forward thinking piece – The Kannon’s team can’t wait to hear what the big guy has to say about it.

Up ahead for the FCC – The troubled transition to Digital TV, Broadband access for all, cross ownership, and what to do about future “wardrobe malfunctions.”

Star Tribune

Kannon Returns Fire: Consensus Insanity, Mortgage Style

Reference is made to the Kannon Fodder directly below, in which Wells Fargo is initiating a new program to bring montly mortgage payments down to 38% of gross monthly income:

When my wife and I applied to various pre-K’s for our kids the schools insisted on elaborate applications complete with parental essays, interviews with the parents, and “interviews” with the kids. I called it consensus insanity; I thought it was nuts, but everyone was doing it, so we did it too.

The authority figures (the schools), made the rules, so the rules were deemed valid, well thought out (except by the incorrigible Kannon), and worth obeying.

And here we have an authority figure (Wells Fargo) telling us about their new program in which they’ll help homeowners get their monthly mortgage payments down to 38% of their monthly gross income. Then 38% must be a righteous figure, because Wells Fargo says so. Right? Wrong.

Consensus insanity is building.

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Kannon Fodder: Bailout Bonanza

Now you too can reduce your mortgage to 40% of you income – (if you have any income, that is…)

From the AP, via “Wells Fargo provides various modifications with the goal of reducing mortgage payments to about 38 percent of the size of a customer’s income.” Can’t wait to hear the rant….