This was emailed to us by PWiggen in Power Point format.  I’ve taken the liberty of transcribing it and posting it here.

Update: Dennis Jantz has provided us with an update to his Power Point Presentation.  This is now Version 2.0.

– Doc

The History of a Financial Disaster


  • Fannie Mae is a GSE (Govt. Sponsored Entity) regulated by Congress.
  • Fannie Mae buys mortgages from other companies.
  • It is backed by the taxpayers for all losses, but keeps all profits!!!
  • President Clinton advocates changes to the Community Reinvestment Act from 1977.


  • Atty. General Janet Reno, accuses mortgage industry of “redlining.
  • HUD, under Andrew Cuomo, changes lending rules to encourage loans to the poor, for “Community development.”
  • Reno threatens banks and mortgage companies with investigations” if they don’t comply.


  • Banks begin making thousands of bad loans.  EX: 0 down, no documentation of income, for 120% (1998 – 2008).
  • Executives at Fannie receive huge bonuses if loan asset targets are met.
  • Franklin Raines and Jamie Gorelick from the Clinton Administration are appointed to run Fannie Mae.


  • Raines earns $100 million in bonuses
  • Gorelick earns $75 million in bonuses
  • In 2004, Enron collapses, congress investigates, Executives Jeff Skilling & Ken Lay go to jail for fraudulent bookkeeping.
  • Congress responds with the Sarbanes-Oxley Act, requiring heavy regulation of corporations


  • President Bush proposes a new oversight committee to clean up Fannie Mae, but Democrats derail the effort.

  • Rep. Melvin Watt, (D-NC) Committee on Financial Institutions & Consumer Credit stated, “I don’t see much other than weakening the bargaining power of poorer families to get affordable housing.”  CLICK HERE


  • Fannie Mae engages in massive fraudulent bookkeeping.
  • False numbers triggered executive bonuses every year.
  • Congress holds no hearings, no one goes to jail, or is punished.
  • WHY NOT?

1999 – 2005

  • Fannie Mae pays millions to 354 Representatives and Senators from both parties, especially on oversight committees.
  • Fannie Mae gives millions to Democratic causes, example: ACORN, now under investigation for widespread voter registration fraud.
  • Who got the most money?

Top Recipients:

  1. Sen. Christopher Dodd, (D-CT) Chairman of the Banking, Housing, & Urban Affairs Committee, 2006 and onward.
  2. Sen. Barack Obama, (D-IL) Federal Financial Management Committee

7.  Rep. Paul Kanjorski, (D-PA)  Chairman of the House Financial Services Sub-Committee on Capital Markets, Insurance, & GSE’s, 2006 and onward.

26.  Rep. Barney Frank, (D-MA) Chairman of the House Financial Services Committee, 2006 and onward.


President Bush, reviled & criticized by Democrats, tried no fewer than 17 times to reform Fannie/Freddie.  A bill cleared the Senate Banking Panel in 2005, but stalled due to implacable opposition from Democrats & a critical core of GOP abettors.  Rep. Barney Frank spearheaded the fight.” – Investors Business Daily

  • Franklin Raines & top execs are forced to resign from Fannie Mae.
  • Jim Johnson takes over ($1.9 Million)
  • They DO NOT go to jail…
  • There is no media “perp walk.”
  • They keep all of their bonuses.
  • They finally pay $31.4 million in civil fines.

The Federal Housing Enterprise Regulatory Reform Act is sponsored by:

  • #325 – Sen. John McCain, (R-AZ) Armed Services & Commerce, Science & Transportation

McCain said, “If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.”

  • NONE of the Top Recipients of Fannie money support the legislation
  • The Reform Act never even makes it out of committee
  • NONE of the politicians return ANY of the money, tainted by fraud.


  • John McCain’s campaign manager, Rick Davis had received income from Fannie Mae & Freddie Mac
    • He was a partner in a consulting firm which received $500,000 from Freddie Mac
    • $2 million as president of the Homeowners Alliance, a coalition formed & financed by Fannie & Freddie
    • New York Times, 9/23/08

  • Regulators at the Securities and Exchange Commission and the Office of Federal Housing Enterprise Oversight, announce a settlement with Fannie Mae that includes $400 million in penalties.   Washington Post
  • Fannie Mae engaged in “extensive financial fraud” over six years by doctoring earnings so executives could collect hundreds of millions of dollars in bonuses, federal officials said yesterday in a report that portrayed a company determined to play by its own rules.


  • Fannie Mae & Freddie Mac goes bankrupt and the Govt. takes them over.
  • Lehman Brothers goes bankrupt from making bad loans.
  • AIG gets $85 billion in loan guarantees.
  • Obama, Pelosi, & Reid try to blame “Eight years of financial mismanagement by the Bush Administration” for the crisis.
  • Barney Frank says, “The private sector got us into this mess, the govt. must get us out.”
  • The Bush Administration & Congress have passed legislation to buy up all the bad loans, at an initial cost to you of: $700 BILLION.

And the future… ?

  • Will any of those who committed fraud ever face justice, or pay a dime?
  • Will the taxpayers ever get their money back?
  • What was your Senators’ or Reps’ role, for better or worse?
  • Who will pay for even more government control of the economy?


Congressional Record, 5/25/06

Herald Tribune, 4/18/08

Husock, Howard. “The Trillion-Dollar Bank Shakedown That Bodes Ill for Cities.” City Journal), Manhattan

Institute for Policy Research, 1/1/00.

New York Times, 9/13/03 & 9/23/08

Day, Kathleen. “Study Finds ‘Extensive’ Fraud at Fannie Mae” Washington Post

Jones, Terry.  “Crony Capitalism is Root Cause of Fannie & Freddie Troubles.” Investors Business Daily, 9/22/08.

Mayer, Lindsay R. “Fannie Mae & Freddie Mac Invest in Lawmakers.”, 9/17/08


Dennis Jantz, 2008

Explore posts in the same categories: Analysis, politics

57 Comments on “SHOT IN THE FANNIE MAE”

  1. Sad in Charlotte Says:

    I received the .pdf version at work… as of today, I’m currently employed by a large financial institution and have been for over 12 years.

    I have personally done a gross amount of research over the past several days (haven’t been able to sleep much) since the company I have given blood, sweat and tears to for my entire adult career has been driven to near destruction, now sold for pennies on the dollar (thanks to the set up of our elected officials from the 1970’s to current, and the slam dunk by a CEO and BOD who categorically refused to heed the warnings against merging with a west coast financial institution with questionable lending practices).

    It sickens me to know that legislators (who clearly know less about financial markets & the economy than I do) are making such enormously impactful decisions about the financial liquidity of our nation.

    I won’t know if I work for my former company, the purchasing company or will even have a job at all for several weeks to come… but what I do have is a voice (and a laptop). And I refuse to be a mindless sheep like so many who fail to do any fact-finding on their own and defer to people who purportedly know more than the rest of us.

    Everything you’ve posted here is stuff I’ve run across in one form or another… I’ll be forwarding your link and appreciate the that you’ve clearly done some homework. Maybe now, the sheep will clean the wax from their ears and the sleep from their eyes and wake the heck up.

    Kind regards,
    Sad in Charlotte

    P.S. I don’t give a damn if the author used pseudo name or not… the facts are the facts.

  2. Las Vegas Belle Says:

    Just to clear up one item, Dennis Jantz is, in fact, a real person and did in fact create the original PowerPoint presentation that has been screen captured above. He works as a part-time instructor, hired on an as needed basis, with the English Department at the University of Nevada, Las Vegas. I work with him there. Personally, I don’t think the question of whether or not he is “real” is terribly crucial to the rest of the debate on this topic, so I wanted to put it to rest.

    Las Vegas Belle

  3. memyselfandI Says:

    Do Republicans EVER assume responsibility for anything? All that is ever heard is”It is the other guys fault! We had no control over this mess.” Grow up, stop whinning and do something constructive, instead of wasting time BITCHING like a bundh of little girls!

  4. memyselfandI,

    Don’t ask me. I’m not Republican.

    But, I would say that the Democrats were DEFINITELY a MAJOR factor in all of this.

    Interesting how this economic meltdown all of sudden “materialized” just as McCain and Obama were tied in the polls….

    I mean, the Democrats kept telling everyone that all was well with Fannie Mae and Freddie Mac…

    In my world, there is no such thing as luck…

    This smells to high heaven like a political chess move…

    Wag the Dog, as it were…

    Salami, Komrade!

  5. az_conservative Says:

    Hi doctorbulldog,

    I just found your site while looking for more info about this ppt. I was thinking of posting it to youtube, but wanted to get the author’s consent. not that I believe youtube would leave it up for any length of time, but I’d feel better and it might change a mind or two. Anyway, great site!

    I agree with you that the Fannie/Freddie meltdown was no accident. It is an October surprise meant to influence the election by blaming Republicans for this mess. It also gave the Commie-crats an opportunity to socialize our housing system and get access to another giant taxpayer-funded cookie jar to fund their campaigns, line their pockets and promote further socialism. I just wish more of the Republicans had voted against this bailout–it will cause so much more damage in the end and anyone who voted for it will pay for it eventually. Taxpayers will pay a lot before that, though. I think they just consigned us to another Depression with this bill.

    Off topic, but it has occurred to me that these ultra-left loonies keep referring to conservatives as the “far-right.” Apparently, they’ve never seen political systems taught the was I was–in a number line of sorts. Center, right and left. The right side is conservative, leading into Fascism if I recall correctly. The left is liberal/populism, leading into Communism. Despotic totalitarianism exists on both ends of the spectrum. Have you ever seen it illustrated this way? If you have, I’d love to have a copy to show my daughter. It used to be in history books–that’s where I saw it when I was a kid.

    Based on that, the difference between conservatives and liberals: the vast majority of American conservatives don’t continue shifting to the right into fascism. It violates the Constitution we hold so dear. But liberals seem to continue shifting left until they are clamoring for Communism without even realizing it. Voting Obama, for example. They are supporting a candidate who is openly advocating Marxist philosophy.

    “Soviet despot Nikita Khrushchev observed that America’s transition from liberty to serfdom would have to be incremental: “We can’t expect the American people to jump from Capitalism to Communism, but we can assist their elected leaders in giving them small doses of Socialism, until they awaken one day to find that they have Communism.” ” (from Patriot Post, 08-40 Digest, 10-3-08)

    This election will tell us how many “serfs” we have in this country.

    One more thing about totalitarian regimes: they must control information. That’s why one of Chavez’s first steps in imposing a dictatorship in Venezuela was to take over all the major media. No dictatorship can allow free speech. Isn’t it interesting that Tzar Obama has Truth Squads running around Missouri, censoring free speech? THAT, folks, is how a totalitarian despot does things. Silence dissent.

    You might find this article interesting. Scared the crap out of me:

    Warmest regards to my fellow conservatives and coldest contempt to the braindead serfs. Sorry for bouncing around off topic. Girls just can’t help themselves, dontcha know.

  6. CA CPA Says:

    I’m guilty. I benefitted from Freddie Mac & Fannie Mae.

    I refinanced my mortgage to a lower interest rate in 2006. One factor in lower mortgage interest rates during the housing bubble, along with low rates from the Fed, was the liquidity in the mortgage market provided by Freddie and Fannie.

    I know it’s selfish – but I’m glad I was able to lower my mortgage payments. It’s making a big difference for this American family every month.

    Thank God for Fannie Mae & Freddie Mac.

  7. az_conservative,

    I’m in Missouri. Yes, the Truth Squads are here and VERY Orwellian in their tactics.

    I haven’t seen a single John McCain ad in about a WEEK, but I see Obama ads EVERYDAY…

    Gee… I wonder why that is…

    RE – Graphic Representation:

    There is one more graph that I have seen that puts a third axis on the first graph and uses the Spectrum graph to fill in the 3rd axis data. It’s much more revealing. But, I’ll have to dig through my files and see if I can find it and upload it.

    Yes, Obama is a pathological narcissist with radical leftist and communist friends. That out to scare the crap out of EVERYONE!!!


  8. Tricia Says:

    The sub-prime debacle, the downturn of the markets, and the economic crisis has affected this nation immensely. If you take me for example, it caused a tremendous effect on my status in many respects, for instance it ruptured my business endeavor (investments in the equities and real estate markets, which was doing amazingly well prior to the onset of the sub-prime debacle last July – my portfolio was up 270%) and it is part of the reason why it has been painfully difficult to find a job since I started searching last October (despite the fact that I have over 10 years of experience and worked for one of the most successful Hedge Funds in the world and two of the most prominent Investment Banks) – I am presently stuck in a rut so deep it seems the end to my distress is no where in sight – not being able to afford to pay rent, by food or handle any of my monthly bills and the bare necessities much less going out to enjoy life a little is to put it simply HELL. For this reason and since I have a great deal of time and flexibility in my schedule since July 2007 I’ve been diligently researching and watching closely as this crisis unfolded – the facts/causes in my findings were very different from those implied in the “Shot in the Fannie Mae” .pps file.

    I wish I could provide a simplified summary which allows us to draw a conclusion as to “how we got here”, but this issue is somewhat complex, and there are number of factors involved, that slide show gives the impression that the answer to this economic crisis is simple “The Democrats did it” and agencies like Fannie Mae and Freddie Mac which contributed to Barak Obama’s campaign also in which Democratic cohorts were at the helm should take the brunt of the blame. Is there one primary group of players, party or industry to blame, no not entirely, but you can deduct – based on all of the facts – that one group should take most of the blame and it’s certainly Not Fannie, Freddie, or the Democrats.

    Although Fannie and Freddie played a part in all of this, they were NOT the only players or the biggest players, nor were they responsible for the bulk is this mess, the biggest players were the Investment Banks, Mortgage firms, as well as other firms like AIG, Thornburg… – btw, I found that a great many of the executives of those firms contributed to McCain and other Republicans’ campaigns. fyi their campaign contributions has been made public and I did a search on the past campaign contributions of the many CEOs of the big name investment banks that went under recently.

    What caused this was Greed, Irresponsibility, and Lack of government regulation of the industries/entities involved, and failed economic policies. Free market capitalism and deregulation has been the main component of Republicans’ ideology up until recently when it proved to be an irresponsible risky approach – all of a sudden now John McCain is huge supporter of regulation. John McCain and many other Republicans has pushed for deregulation since day one – again up until recently after that approach led to the collapse of the markets. When asked in an interview if he has a different view on free market capitalism and deregulation John McCain wouldn’t even admit it was the wrong approach instead he stated “No. I think the deregulation was probably helpful to the growth of our economy” ***Link to interview:

    I feel the article below provides a good synopsis of and sheds some light on “How we got here” and the 60 minutes piece on the economic crisis sheds even more light – ***60 Minutes Interview with various financial markets experts. A Must See: or you may read it:

    In addition to that, and on a separate note a 60 minutes piece also reveals how close America was to the capture of Osama Bin Landen not too long after 9/11 but the operation was terminated by higher ups in the Bush Administration – Must See: or if you opt to read

    Instead the Bush Administration opted to go to war – and incredibly pointless and costly war (approx. $550 billion dollars and more importantly 1000s of lives). US Federal Budget for Fiscal Year 2009:

    Total Outlays (Federal Funds): $2,650 billion, MILITARY: 54% and $1,449 billion, NON-MILITARY: 46% and $1,210 billion. U.S. military spending – Dept. of Defense plus nuclear weapons (in $billions) – is equal to the military spending of the next 15 countries combined.

    If you’re interested here are links to more details on the costs of this war:


    In regards to Sarbanes Oxley aka SOX: It was drafted by Paul Sarbanes (former Democratic Senator of MD), and Michael Oxley (a Republican Representative of OH) was the second main architect. It was enacted in 2002 in response to a number of major corporate and accounting scandals including those affecting Enron (current Vice President Dick Cheney was involved with at some point), Tyco International, Adelphia, Peregrine Systems and WorldCom. These scandals, which cost investors billions of dollars when the share prices of the affected companies collapsed, shook public confidence in the nation’s securities markets.

    SOX established new or enhanced standards for all U.S. public company boards, management, and public accounting firms. It established a new quasi-public agency, the Public Company Accounting Oversight Board, or PCAOB, which is charged with overseeing, regulating, inspecting, and disciplining accounting firms in their roles as auditors of public companies. The Act also covers issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure.

    Prior to SOX, auditing firms, the primary financial “watchdogs” for investors, were self-regulated. They also performed significant non-audit or consulting work for the companies they audited. Many of these consulting agreements were far more lucrative than the auditing engagement. This presented at least the appearance of a conflict of interest. For example, challenging the company’s accounting approach might damage a client relationship, conceivably placing a significant consulting arrangement at risk, damaging the auditing firm’s bottom line.

    Critics of SOX, such as congressman Ron Paul (Republican) contended that SOX was an unnecessary and costly government intrusion into corporate management…


    How We Got Here: It’s Housing, Stupid

    by Chris Isidore

    Thursday, September 18, 2008

    The Wall Street crisis has been caused by plunging housing prices. So despite the billions of dollars being thrown at the problem, experts say more trouble lies ahead.

    The nation’s financial system is in the midst of a massive shakeup and many on Wall Street and in Washington are pointing fingers and looking for someone to blame.

    But in the end, it all comes back to one issue – housing. Earlier this decade, it was much easier to get a mortgage. Home prices soared about 85% from 1996 through 2006 in inflation-adjusted dollars, creating a bubble.

    Then the bubble popped. And the fallout isn’t over yet, experts say.

    In the past two weeks, the government took over Fannie Mae and Freddie Mac, Lehman Brothers filed for bankruptcy and Merrill Lynch sold itself to Bank of America.

    If all that weren’t enough, the Federal Reserve announced late Tuesday night that it was loaning $85 billion to insurer American International Group.

    None of this would have happened if the housing market had not imploded, leaving all these firms with staggering losses from their investments tied to mortgages.

    “These institutions, which weathered all kinds of calamities before, including depressions, are being knocked out,” said Lakshman Achuthan, the managing director of the Economic Cycle Research Institute. “It’s a testament to the significance of the problem we have here.”

    Thus, experts agree that there are likely to be future shocks to the financial system until the housing market finally hits bottom.

    Even Treasury Secretary Henry Paulson, the administration’s point man in the many rescue discussions of the past month, admits this.

    “The housing correction poses the biggest risk to our economy,” Paulson said the day he announced the Fannie and Freddie seizure. “Our economy and our markets will not recover until the bulk of this housing correction is behind us.”

    The Problem of Falling Home Prices
    But because of the depth of the housing problems, it may take a long time before real estate prices head higher again. Here’s why. Home prices, while sharply off from the 2006 peaks, are still high in comparison to long-term gains in income, rents or overall prices, suggesting that they still have a way to fall, according to experts. The reason housing is wreaking havoc even on insurers like AIG and big investment banks, who do not make mortgage loans, is that during the boom, trillions of dollars of mortgages were packaged together into securities that promised to pay investors with the proceeds of those loan payments.

    Those securities paid better rates than other types of assets during the boom years. So many investors from around the globe poured as much money as they could into those securities.

    Faced with this demand, lenders starting making more loans to riskier borrowers, including people who might not be able to afford their mortgage payments in the future and even many with no proof of income.

    When prices were rising, this wasn’t a problem. The risk of loan foreclosure or default was limited because many homeowners were able to sell their house for more than they owed and make a profit. But once prices topped out and began falling, loan defaults and foreclosures started shooting higher as homeowners found it more difficult to sell their house. This created problems not just for subprime borrowers but even for those with good credit and income.

    When foreclosures rose, the value of the various types of securities tied to mortgages started to fall, causing huge losses up and down Wall Street. It also made banks less eager to extend credit because of the risks involved.

    A Downward Spiral
    This credit crunch in of itself slowed the economy, leading to job losses and more defaults, feeding a downward spiral that has been difficult to stop.

    “A really bad situation—a home price bubble bursting—was made significantly worse when the recession began,” said Achuthan. “Now we have to let this thing play out.”

    Some experts even argue that the steps being taken to rescue firms like AIG could make a recovery in housing and the broader economy more difficult, as financial firms and investors become more reluctant to lend money.

    “We are certainly taking credit and squeezing it tighter and tighter,” said Kevin Giddis, managing director of investment bank Morgan Keegan. “Housing needs buyers. Buyers need credit.”

    Achuthan said that even though rates for mortgages and other types of loans have fallen in the last two weeks, those loans are becoming more difficult for many consumers and businesses to get because banks are severely tightening their lending standards.

    And if housing prices do fall further, that will only cause more losses in the financial sector and perhaps more failures of banks, insurers and securities firms.

    “I would hesitate to say the worst is behind us,” Achuthan said.

    So even with perhaps hundreds of billions of tax dollars going to AIG, Fannie and Freddie, one expert said the only real solution to the housing problem is for the correction in housing to finish running its course.

    “We want home prices to return to normal,” said Barry Ritholtz, CEO of Fusion IQ and author of the upcoming book “Bailout Nation.” “Until that happens, you can throw as much money at the market as you want at the situation….and it ain’t going to make any difference,” Ritholtz said.

    Copyrighted, CNNMoney. All Rights Reserved.


    These are links to other interesting/insightful articles and facts pertaining to the state of the economy past and present and the economic crisis:

    • 1999 U.S. budget surplus to be larger than expected $76 Billion:

    • 2000 President Clinton announces another record budget surplus of $236 Billion due to fiscal discipline:

    • 2000 The lowest unemployment rate in 30 years 4%. In 1992, when Bill Clinton was elected President, the American economy was barely creating jobs, wages were stagnant, and the unemployment rate was 7.5 percent. His bold, three-part economic strategy focused on three objectives: fiscal discipline, investing in education, health care, science and technology, and opening foreign markets:

    • 2000 Clinton, GOP air differences on tax cuts:

    • 2001 Bush Tax Cuts Widen US Income Gap:

    • 2008 Estimates say fed budget deficit nearing $407B:

    • 2008 Unemployment rate highest since 2003 6.1%:

    • 2008 Obama: McCain’s deregulation too risky for economy:

    • Deficit graph during the various administrations 1963 – present:

    • Unemployment rate chart 1991 – present:

    • The income gap widens during Reagan years:

  9. AnonA Says:

    CA CPA,

    I’m very glad that worked out for you; I’d be a terrible “fellow American” if I weren’t. However, as someone processing foreclosure documents for [a certain loan servicing company that is now a subsidiary of a large bank], I’d be deceiving myself and others if I didn’t say that Fannie and Freddie have done more harm than good in the past decade. We’re seeing flood after flood of families losing their homes. And I only process the loans for one state. Again, I’m very glad you’ve actually benefited (the whole point of F&F to begin with), but I don’t want us to forget those others who are being left behind by the the man in the big office.

  10. steves Says:

    Warmest regards to my fellow conservatives

    Bush conservatives or McCain conservatives?

  11. Reagan & Palin Conservatives!


  12. Alan Says:

    AIG got $85 BILLION, not MILLION. As for the conservative finger pointing; you obviously lost your ass in this market. It’s no one’s fault but your own you greedy bastards. POP!

  13. Bill G Says:

    You idiots. There are multiple grammatical errors in this document, as well as an amount of bias that would never become part of a professor’s teaching presentation. It is a fraud.

  14. Bill G Says:

    McCain only started on the bandwagon for campaign reform after he was admonished for meetings and contributions from Charles Keating and the previous real estate debacle. Or don’t you remember back that far?

  15. Bill G.

    Don’t give me that Keating Five crud. McCain had NOTHING to do with it.

    You and the Main Stream Media obviously have been sucking on Obama’s hookah for far too long.

    Don’t believe me? Here let me help you, because you obviously don’t remember back that far. Here’s what Robert Bennett (a DEMOCRAT lawyer who was tasked by the Senate Ethics Committee with investigating McCain during the scandal) had to say about McCain:

    “You know, I’m in a pretty unique position to talk about John McCain. First, I should tell your listeners, you know, I’m a registered Democrat, so I’m not on his side of a lot of issues. But I investigated John McCain for a year and a half, at least, when I was special counsel to the Senate Ethics Committee in the Keating Five, which, by the way, this New York Times article goes back to and discusses, goes back years and years.

    And if there is one thing I am absolutely confident of, it is John McCain is an honest and honest man. I recommended to the Senate Ethics Committee that he be cut out of the case, that there was no evidence against him, and I think for the New York Times to dig this up just shows that Senator McCain’s public statement about this is correct. It’s a smear job. I’m sorry. ”

    And, I uploaded the video JUST FOR YOU!


    BTW – I bet you didn’t even know that John McCain got in a fight with one of the other guys when he found out what was going on behind his back…

    The McCain and Glenn, were PROVEN innocent. But, the same can not be said for the three Democrats – Senator DeConcini, Senator Cranston and Senator Riegle…

    Now, go away and blow your hookah smoke somewhere else, because WE KNOW THE TRUTH. We lived through it.

    Salami, Komrade!

  16. az_conservative Says:

    I’m with doc on Reagan and Palin, definitely, but I’m a US Constitution and founding principles conservative. But that is splitting hairs. Neither McCain nor Bush are really conservative, are they? Lesser of the evils when faced with a loony liberal, but that doesn’t mean I agree with either one on many issues.

    Graphical representation: Thank you, doc! The first link is nice, although I’m not sure the second is accurate. It has good points, but is limited by presenting only two extremes. The first provides more gray area, which is where reality and pragmatism lies. The author, though liberal, presents a thoughtful analysis, as well. Very interesting read.

    I am reading the Declaration of Independence, and it’s striking how many of these “injuries and usurpations” our current government is guilty of (Bush as well). Maybe we are coming full circle. Jefferson warned us of many of the pitfalls we’ve fallen into. I wonder, was he a prophet, or did he just possess an extraordinary understanding of human nature?

    The concern that most preoccupies my political thinking: I think we have a liberal camp running straight off the cliff into communism. Given who and what Obama is, I think he will lead us into another civil war. Even if McCain wins, it may be unavoidable, because the conflicts created by the polarization we have in America today must eventually be resolved through bloodshed. It is the natural course of extreme ideological conflict throughout history.

    Karl Marx said: “We can’t expect the American people to jump from Capitalism to Communism, but we can assist their elected leaders in giving them small doses of Socialism, until they awaken one day to find that they have Communism.”

    We have certainly been fed small doses of Communism, beginning with FDR’s New Deal shoving a gluttonous dose down our throats. Seems every time they manage to savage our economy, it is a calculated disaster enabling the force-feeding of another giant helping. I think we are closer to Communism today than the Constitution, and I suspect the founding principles to be shredded under Obama will be what remains of the Bill of Rights. We cannot allow that to happen, lest we awaken to find ourselves in a true dictatorship and helpless to fight back. I also suspect there are tens of millions of Americans who know this to be true, and will fight it to the death, hence my prediction of the coming Civil War II.

    Alan & Tricia… Never try to reason with a liberal. It makes you look foolish and only frustrates the liberal.

    Doctorbulldog: I look forward to seeing the other graphic, thank you.

    Best to all!

  17. az_conservative Says:

    I see that Paulson has picked another Goldman Sachs exec, Neel Kashkari, to head the new Office of Financial Stability. Gosh, think there will be any cronyism going on?

    We are so screwed.

  18. nedwilliams Says:

    Thanks for cleaning this up and re-posting it–but please correct the misspelling of the name”Gorelick”

    And claims that John McCain has “a reputation of being against regulation” are stupid–heard of McCain Feingold? I hate to remind the GOP base about that regulation on free speech, but it is ignorant to flatly assert that McCain opposes regulation.

    And please insert a link to this youtube video to enhance the Melvin Watt assertion.

  19. nedwilliams,

    Thanks for reminding me about the Gorelick spelling error. I noticed that when I was fact-checking, but forgot to fix it.


  20. n7tek Says:

    Would someone post the URLs to the news articles (or the articles themselves) that were used as sources in the Powerpoint presentation and on this website? I have some Liberal friends that won’t believe this unless they can read the original sources.

    Thanks in advance!

  21. breezeatdawn Says:

    I haven’t read through every comment on here so I’m not sure if anyone else addressed this – how about checking all the facts of the PPT (like Bulldog I agreee it probably doesn’t matter if Prof Jantz is real or not). What is real is that every one of us has access to the Library of Congress, to all of the bills and their status. I realize it is time consuming (Lord knows) but if you really wanted to you could skip the media altogether and go straight to the sources (Congressional transcripts and testimonies!).
    Anyway, I got the e-mail PPT and sent this reply back. I know it’s a little wordy but I think I’ve made my point.

    While Democrats were certainly involved in the Frannie Mae – FAIL, Republicans were apparantly also part of the Fannie Mae debacle. Robert Zoellick, current head of the World Bank was part of Fannie Mae for 2 separate terms totalling 7 years (among
    others). It seems to me that they all (D & R alike) just want in on a cut
    of the money, or maybe they all just want a cush job that comes from being
    appointed by a buddy in government. (

    Pres. Bush may have created an oversight committee but he also certainly
    promoted an “ownership” society, including homeownership.
    “The President’s vision of an “ownership society” has been a central theme
    of his Administration. Ownership – and homeownership in particular – is the
    key to financial independence, the accumulation of wealth, and stronger,
    healthier communities.” – Secretary Alphonso Jackson, US Dept HUD before the
    US Senate Committee on Banking, Housing and Urban Affairs, 4/21/05

    By the way, the Committe on Oversight and Government Reform also said this
    about Bush in December, 2007:
    “The evidence before the Committee leads to one inescapable conclusion: the
    Bush Administration has engaged in a systematic effort to manipulate climate
    change science and mislead policymakers and the public about the dangers of
    global warming.”

    The PowerPoint has some things just plain wrong, at least from what I can tell. His source should be, he has #325 by McCain and the Federal Economic Reform, etc. bill – not sure what that is for. The bill# is S. 190 and McCain was not THE sponsor of the bill, he was a co-sponsor.
    The bill did not make it out of committee

    And it fails to mention that a similar, new bill was introduced in 2007. It
    has the same sponsor, and out of the 3 co-sponsors the other 2 are the same
    (Elizabeth Dole and John Sununu) John McCain is not a sponsor or co-sponsor
    of this new bill at all. However, all of the sponsors are Republicans.
    As far as I can tell the only thing either bill does is set up a new
    corporation, and create a Director and Deputy Director and a Board to
    oversee things, giving the Director lots of responsibility.
    Sen. Obama did sponsor this somewhat related bill:|/bss/d110query.html|
    to stop mortgage transactions that promote fraud.

    In did, in fact, I looked at a summary of every bill, senate resolution and
    amendment that has been sponsored by either Senator (Obama-130, McCain-38)
    in the current session (since beginning of 2007)
    McCain has a lot of bills supporting Armed Forces, the commander in Iraq,
    Native American activities, wildlife areas in Arizona, and campaign reform.
    McCain has several bills trying to create more transparency around lobbying
    Obama has a lot of bills in support of sustainable energy, schools,
    diversity, and Armed Forces (once they return from duty). Also bills
    against nuclear terrorism and Iran. Obama has several bills trying to
    create more transparency around contractors for hire by the government, and
    government spending.
    This is a simplification, but you get the gist of it.

    These are just those that the Senators have sponsored. I did not look at
    everything they co-sponsored as well. Nor did I look at their votes. I
    encourage everyone to look for themselves ( and not
    just take what the media says, or every forwarded e-mail says at face value.

    From looking at both Senator’s bills my impression is that both men have at
    least tried to do some good things. They have their priorities (McCain –
    armed forces, Arizona, native americans in Arizona; Obama – the environment,
    schools/education). I just don’t see where either one is the devil the
    others’ campaigns make them out to be. I imagine that they both are guys
    who are doing the best they can with what they’ve got (I hope). Doesn’t
    really matter though, everyone seems to have made up their mind based upon
    their own criteria and filters. That includes each campaign and the media
    that report it. Truth be damned.

    I don’t think either one is the perfect candidate, but then again no one is.
    Frankly, the main thing I don’t like about McCain is that I’m concerned
    about his health and I think Sarah Palin is an idiot. Yes I said that. (I
    think we both agree that some random hockey mom – Governor of Alaska or
    trophy wife from Minnetonka, MN – is not who we want running the country). She
    may relate to Joe Sixpack but that doesn’t mean I want him running the
    country either.
    I’ve seen a few sources that site McCain’s IQ at 133. I’ve read estimates
    of Obama as slightly higher. I can’t find anything on Palin, wish I could.
    My IQ is over 150, maybe I should be president.

    I just hope that everyone can focus on the positive, asking “what do I want
    out of this government?” instead of, “what has the media and the political
    party scared me into?” Think for yourselves, people. It is a free country
    after all (at least for now).

  22. Dennis Jantz Says:

    I have received many great suggestions for improvement in the presentation; it is now more accurate, authoritative, and includes more direct sources. I would like to send it to you to replace the old version, put I don’t see an e-mail address or a link. Could the webmaster e-mail me directly?

    For the record, I am an Adjunct Instructor at my university, not a full professor. My Masters is in Educational Administration, so please don’t call me Doctor! The views expressed in the presentation are solely mine, as a private citizen, and in no way intended to represent any posiiton of the university or its staff.

    My goal has been to provide accurate information, to as many people as possible, and provoke debate on an important national issue. Thank you for helping me succeed.


    Dennis Jantz

  23. Jim Carter Says:

    Someone emailed this Power point to me and I found this website while doing a Google search. Now that Professor Jantz has made his presence known, perhaps it would be enlightening to see another presentation on the Enron scandal. Who benefited from Enron’s largess, the roll of Enron in the fake California energy shortage that led to Grey Davis’ recall.

    I tried to skim over the comments that I did not actually read. I don’t recall if anyone pointed out to Mr. Jantz that Enron went bankrupt in 2001, not 2004. Ken Lay never went to prison, having died 3 months before sentencing at the age of 64. There are some conspiracy theories (tongue in cheek) that speculate with all his money he could fake his death Anyway, Ken Lay was a friend to both Bushes, was considered for Sec of Treasury under W, and was part of Cheney’s secret energy advisory board.

    Jeffery Skilling lived to be sentenced to a country club prison.

    Checking some of Mr. Jantz’ figures at www, there is a list of campaign contributions from Fannie Mae and Freddie Mac for 1989-2008.

    Of the top 10 recipients of Fannie Mae money, 5 are Democrats. Democrats have positions 1-3, Republicans have 4-6. Obama got $126,349, McCain got $21,550. Barney Franks is #26 with $42,350 with 12 Republicans in front of him. Companies usually donate more to winners. Democrats are getting record donations lately but when they were out of power, it was the Republicans who got lots of money.
    I don’t think the books are closed on the Fannie Mae execs. They will get their public flogging and hopefully some time in jail.

  24. Mike Bee Says:

    Fundamentally the real problem wasn’t only a lack of regulation for subprime loans but the shadow market of credit default swaps. Put simply, credit default swaps are unregulated “insurance” contracts between large investment houses that allow the insurer to ignore any capital requirements to cover the condition where the “default” occurs. Okay, maybe “put simply” is an overstatement. What happened was a large number of very big firms realized they could make an amazing amount of money selling these CDS “insurance” contracts. Many of the very same firms would buy these same CDS derivatives to hedge risky investments. When they hedge on a large and risky investment, it becomes “risk free” — unless the seller of the CDS can’t end up paying. Warren Buffet in early 2003 [] called derivatives, like CDSs, “financial weapons of mass destruction.”

    AIG specifically was not both selling and buying CDSs like many firms, but only selling. They are an insurance company and had a small 400 person office (they have a international workforce of more than 100,000) working on CDSs. That small office brought down the company because they made huge amounts of money selling CDS insurance policies with no where near the amount of capital to cover the condition that they needed to cover another group defaulting. And because there was no market or regulation for these contracts, there were no capital requirements ensuring that they could actually cover them. They were using actuarial tables similar to personal injury tables; these tables calculated each contract as independent of all other contracts. This meant that in the unlikely event of having to payout on a CDS, it was not any more likely they would have to payout on others. As Jon Stewart would say, “funny thing,” turns out that they are all connected.”

    So the CDS market is completely unregulated. There is no oversight, no exchange, and so no one actually knows what the total of CDSs are — the estimate is around 60 trillion dollars. This means that if everyone defaulted, these companies would owe $60 trillion. And 700 billion is 1.1% of that. The good news is not everyone will default.

    The lack of regulation leads to mortgage-backed securities which allow subprime loans too be bundled together and hedged with CDSs. If I’m a lender at a traditional bank and instead of selling a loan that my bank will have on the books for 30 years, I’m selling a loan that we will resell risk-free in a few weeks — I don’t have to worry about doing my homework. And that lack of regulation for all of this allowed interest-only and ARMs to be given to subprime borrowers with the justification that the ever-increasing housing market (read Irrational Exuberance, 2nd edition which correctly predicts the housing bubble) will allow these borrowers to “grow” into their mortgages.

    Now mix these new mortgage-backed securities with the fragile international market that the credit default swaps lead to in backing them. And add to that agencies rating the risk of mortgage-backed securities who are paid by the investment banks packaging and selling them. And add the irrational assumption that house prices will go up double digits each year (only health insurance costs do that).

    So when the real estate bubble bursts, it hurts. But it really hurts mortgage-backed securities that are supposed to be fairly risk-free. And the companies that have insured many of those securities via CDSs now owe money. Because they don’t have the liquid capital (ie cash flow) to pay on these defaults, they must sell assets. When everyone sells assets to pay this off, they start losing their value. This loss of value triggers more default conditions to be triggered and selling from the many companies that don’t have the capital that a well-regulated market would have required. Back to AIG. AIG was a seller of CDSs. Their traditional insurance pool didn’t come close to cover what they had gotten themselves into. A well-regulated market would have required that they had enough capital reserves to cover all these CDSs just like the banking industry after the Great Depression were required to keep certain amounts of cash on hand.

    There’s the problem. There’s the temporary and there’s the longterm solution. The temporary solution is capital to the banks, injections of liquidity, etc. The longterm solution is oversight, regulation, and willingness to admit that the answer is not breaking government but fixing it. Fully free markets will lead to huge corporate mergers, ownership of the political process, corporate demand for as few regulations as possible, no attention to externalities, and a search for short-term profits that trump any societal risk. Well-regulated markets means breaking up large companies so they can be competitive. It means oversight and setting rules of how markets, contracts, and business operates.

    And what led to this problem has been a governing doctrine that espouses getting government out of the way, deregulation, completely free markets are best. This has been the Republicans governing philosophy and only in the last month have I heard any changes to this. The document blaming Democrats and Barack Obama and praising John McCain for trying to save things is a distortion of the facts. Some fact checking:
    1) Fannie Mae was created by FDR and semi-privatized by Lyndon Johnson in 1968 –
    2) Top 4 Fannie Mae recipients is incorrect. FEC has much more accurate data on contributions from people of influence in an organization. McCain has gotten 10 times more donations than Obama. OpenSecrets is comparing all employees at Fannie and Freddy, 11,700 people. It isn’t surprising during a presidential election that Obama is winning this. The FEC list has people that work at Fannie and Freddy — but also lobbyists that work for them.
    3) Raines is not an advisor, he was once asked four years ago about the market. And this is the only connection between Obama and Raines that is being reported on. “The profile reported that Raines, who retired from Fannie Mae four years ago, had “taken calls from Barack Obama’s presidential campaign seeking his advice on mortgage and housing policy matters.””
    4) If the discussion on the company a candidate keeps: McCain’s confidant and adviser Charlie Black, whose firm worked for Freddie Mac for several years ending in 2005
    5) Fannie Mae was found keeping fraudulent books in early 2005. Republicans were in control of the senate and house until Jan 2007. Wall street malfeasance should be criminalized. Fraud inside Fannie Mae should not be tolerated.
    6) And the reform that McCain supported — Federal Housing Enterprise Regulatory Reform Act of 2005 was introduced on Jan 26, 2005. Where it died in a Republican-controlled committee of the Republican-controlled Senate. A further note, McCain signed on to the bill after it was already dead in committee.
    7) On 31 July 2007, after the Democrats obtained control of the Congress in the November 2006 election, House Speaker Nancy Pelosi introduced HR 3221, a “bill to provide needed housing reform and for other purposes.” Among other things, the bill granted the newly formed Federal Housing Finance Agency “supervisory and regulatory authority over Fannie Mae, Freddie Mac, and the federal home loan banks (enterprises)” (per CRS analysis). Pelosi’s bill became Public Law 110-140 on 19 December 2007.
    8) An additional note: “Senator John McCain’s campaign manager was paid more than $30,000 a month for five years as president of an advocacy group set up by the mortgage giants Fannie Mae and Freddie Mac to defend them against stricter regulations, current and former officials say.”

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