Surprisingly, This Time It Isn't Sen. Schumer's Fault

I know that it is currently in fashion to speculate on whether Charles Schumer caused the recent run on Indymac Bank. Now, I'm no fan of Sen. Schumer's politics, but I've always liked his style, so I'm going to defend him on this one.

In fact, you just need to look at the numbers to know that Indymac was a disaster just waiting to happen. Look at its Texas ratio. What's a Texas ratio? The Texas ratio is a formula worked out by economists at the Royal Bank of Canada during the series of Texas bank failures during the 1980s. It is calculated by dividing a bank's non-performing loans, including those 90 days delinquent, by the company's tangible equity capital plus money set aside for future loan losses. The RBC economists noted that banks almost inevitably fail when this ratio reaches 1:1, or 100% or greater.

What was Indymac's Texas ratio? 140%. A disaster jut waiting to happen. Remember the failure of ANB Financial National Association back in May? ANB had a Texas ratio of 344%!

Now, a recent study by Research Associates of America lists 10 banks with a Texas ratio over 100% in the US:

Colorado Federal Savings Bank	Greenwood Village	CO	244.8
Eastern Savings Bank, FSB	Hunt Valley	MD	222.7
Integrity Bank	Alpharetta	GA	191.6
Ameribank, Inc.	Welch	WV	153.7
First Priority Bank	Bradenton	FL	122.6
First Security National Bank	Norcross	GA	112.1
Magnet Bank	Salt Lake City	UT	110.4
Security Pacific Bank	Los Angeles	CA	102.8
First National Bank of Brookfield	Brookfield	IL	102.1
The State Bank of Lebo	Lebo	KS	100.6

Now, that's not a guarantee those banks will fail,but I for one would think long and hard before investing or depositing in any of those banks. The bigger US banks are better, but still uncomfortably high in their Texas ratios, in my opinion. Wachovia, for example, is at 78%, according to that impeccable source YahooAnswers.

Contrast that with the well-regulated Canadian banks (Canada has the best banking system in the world): Bank of Montreal has a Texas ratio of 11%; Bank of Nova Scotia 10%; Royal Bank of Canada 8%; Canadian Imperial 8%; National Bank 5%; and Toronto-Dominion Bank 3%. Now, I actually think that the Canadian banks could stand to be a little more risky with their Texas ratios, especially now that their gargantuan record profits are starting to slip, but I actually have full confidence in the Canadian banking system to come out on top, so I'll trust management on this one.

I thought that Carly Fiorina did a great job this morning on Meet the Press. Claire McCaskill looked like such a slimy, partisan (and ill-informed) politician by comparison.

I hope we see a lot more of Fiorina in this campaign.

Draft Fiorina for VP, anybody?

Man's Best Friend (Except...)

As a general rule, I find Mark Steyn a little over-the-top in his predictions of the imminent extirpation of Western civilization by Muslim hordes.

But then one comes across this article about an anti-puppy assault by British Muslims and it makes you think.

Pickens to the Rescue!

Next only to perhaps H. Ross Perot, T. Boone Pickens has recently become my favorite eccentric Texan billionaire.

If he does half as much good as Perot, the country will owe him a debt of gratitude.

Gramm Refuses to Apologize - I'm Conflicted

I'm conflicted as to how to respond to Phil Gramm's refusing to back away from his remarks on the US being a nation of whiners.

My initial reaction is: "You go girl." People are really whiny. The Iraq War is far less popular than the Vietnam War ever was, which makes no sense to me. The economy hasn't even officially entered recession and you've got Mort Zuckerman - hardly a liberal - saying this is an economic downturn to rival the Great Depression. It's perplexing, and thank you Phil Gramm for trying to bring the country back to reality.

On the other hand, he seems to have forgotten that there is a campaign going on. McCain needs to "feel people's pain", because those whiners out there in the country get to vote. It was bad politics on Gramm's part, very bad politics. I guess maybe you can make a case that by having McCain denounce Gramm - whom he had hitherto touted as one of the people he listened to about economic matters - makes McCain look good for "getting it". But ultimately I think this was net negative for the McCain campaign.

Tax Lady

One more thing:

I don't know if you saw this woman who went on this hilarious anti-tax rant at McCain's town hall meeting in Denver yesterday, but she was really funny As my case in chief that Scarborough is more fun than any of the other political talking heads, I enter as evidence the fact that he used this hilarious clip as his lead-in during his interview with McCain. I haven't seen that clip anywhere else, but it was really funny, and you can see Scarborough playing it for McCain here.

Ahhh, refreshing

I'm having the first really productive day of studying for the Bar that I've had in a week (I know, I know, I shouldn't be jinxing the day by posting about it), and I give a lot of the credit to the fact that I woke up early (which I very rarely do) and got to catch Morning Joe this morning.

I miss Joe Scarborough in prime time. There was a time when I really felt that MSNBC had the best news talk show back-to-back on TV with Chris Matthews followed by Joe Scarborough. One was a Democrat, one was a Republican, but you really got the sense from both of them that they were really enjoying themselves, and they had these effusive personalities that made debating the issues of the day really entertaining. Now that Scarborough has been exiled to the morning and Chris Matthews has turned into a cranky old man, not to mention more and more of a partisan hack, there's not really anybody left in prime time that I really enjoy watching.

Raise Taxes or Raise Revenue

I've said it before but it bears repeating again:

The idea on the left that the Bush tax cuts have been horrendous and need to be reversed simply isn't borne out by the facts. Yes , there was some decrease in government revenues in Bush's first term, but the last four years have seen the most rapid increase in tax revenues in the entire postwar period. That's because tax cuts fuel economic growth, which in turn raises revenue.

Even if we accept Obama's mischaracterizations of his own tax plan and say that he only wants to raise taxes on the rich, that tax raise would have the effect of slowing growth, and would therefore result in a leveling off of the steep rate at which government revenues have been growing. That's just bad policy.

Kerry Blows Hard

John Kerry: McCain is even more of a flip-flopper than me.

Well, I guess Kerry is the expert in the category. And yet for some reason I find his claim somewhat less than credible.

BTW - Chris Matthews last night reported that Obama is considering Kerry for VP. Now, I'm sure there is no chance in hell that that is actually the case - but seriously, how awesome would that be if Kerry were on the ticket?

Iraqi Yellowcake to Canada

Given my previous post, I guess it's for the best that the remnants of Saddam's nuclear program - which the left assures us never existed ("move along, nothing to see here") - arrived in Canada today and will provide nuclear power to the good people of Ontario.

Go Canada

Returning to my Canada as model conservative country point:

The Telegraph today ran a story in which it argued that of all the world leaders meeting at the G8 Summit in Japan, only Canada's Stephen Harper really has a popular and successful record in office.

Let's look at Harper's accomplishments: he's cut
taxes, reduced the deficit, had Canada for first time in recent memory really step up to the plate on the world front (notably in Afghanistan), has resisted left-wing pressure on the Kyoto Treaty, and has generally been a competent manager following years of Liberal corruption.

Thus, with the US preparing to lurch to the left with the Obamessiah, this might finally be Canada's chance to finally become a proper, grown-up country, fully assuming its position on the world stage.

Democratic Congress Stinks It Up

Who would have thunk that we'd see the day when three times as many people have confidence in the US Supreme Court as have confidence in Congress? Or when people are four times more confident in organized religion than in Congress? Oh and did I mention that the police and the military are even more popular than that?

Oh well, I'm sure once there's a Democratic president, all of their problems will
be magically solved...

Neutering Faith

It's nice that Obama came around to Bush's view on Faith Based Initiatives. However, it should be noted that this looks much more like a cynical ploy on Obama's part once you realize that he's totally toeing the liberal line on one of the most controversial aspects of the Initiative: whether religious charities that take funds from the government should be allowed to limit their staffing to members of their own religion. Obama's position: force churches to hire anyone. You take the government money, you also have to hire the Wiccan, the Satanist, and Christopher Hitchens. This is a position which unfairly forces religious charities to water down their religious nature and thus becomes a way to stealthily impose a liberal agenda on religious organizations. Shame. Let faith-based organizations be faith-based organizations.

At Last

Well, it's nice to see that somebody finally put out an effective ad.

Seriously, though, memo to Steve Schmidt: it's time to get this show on the road. No more trips to Canada or Colombia, just start campaigning.

Give McCain Credit

This week, George Stephanopoulos, on This Week with George Stephanopoulos, pointed out that last week was the first week since the start of the Iraq War that the Pentagon released no names of dead soldiers from Iraq. That's a sign of how much violence is down in Iraq. What great news for Independence Day weekend.

It's really starting to look like a corner has been turned in Iraq and that George Bush's legacy might actually be creating a functioning democracy in Iraq. Unless, of course, the Democrats get elected and end up messing things up.

The Left's Hypocrisy on Bush

If George W. Bush is really, as many liberals seem to believe, "the worst president ever", why is Barack Obama so eager to embrace Bush's policies?

Ways I Waste Time

Well, I'm obviously not where I should be right now - which is taking my BAR/BRI Multistate practice exam. Dang it, why is law so boring?

Anyhow, if you want to learn something about Iranian history (and who doesn't), I've posted the workmanlike notes that I compiled from Wikipedia onto my own Wiki. Learn away.

Tired, Corrupt Old Liberal Paradigm

Classic old liberal paradigm: 1) identify social problem; 2) piously click your tongue at anyone who won't support spending money on fixing problem so identified; 3) let your friends skim a little off the top because, heck, we're doing good work; and 4) when the policy fails, blame the government for not spending enough money on it.

Luckily, Obama is prepared to shift this old liberal paradigm - just look at his record. On the other hand, better not to look at his record if you want to keep thinking that.

All Things to All People? Or Nothing to Nobody?

So, the same week Obama is attempting to appeal to religious voters by touting his new-found support for "Faith-Based Initiatives," he is also shoring up support in the gay community by reiterating his opposition to the military's "Don't Ask, Don't Tell" policy.

Given Obama's blatant pandering and flip-flops, one wonders whether either of the relevant groups will be fooled by these efforts.