Federal Reserve officials in August 2007 saw the beginnings of the crisis in subprime mortgages and concluded that the U.S. economy would be able to withstand it, even as some Fed members warned that it could trigger a downturn, transcripts from their 2007 meetings show.
“Well-capitalized banks and opportunistic investors will come in and fill the gap, restoring credit flows to nonfinancial businesses and to the vast majority of households that can service their debts,” Donald Kohn, then vice chairman of the board, said in Aug. 2007 according to transcripts of the Federal Open Market Committee meetings released today in Washington.
The transcripts show the committee’s slow grasp of the enormity of contagion that was to spread throughout global markets as a result of billions of dollars in low-quality housing assets that had been securitized into bonds and sold to banks and investors worldwide. Several FOMC participants such as then-San Francisco Fed President Janet Yellen sounded alarms in the first half of 2007. Still, the FOMC focused on the economy’s performance and showed reluctance to alter policy until August.
“The odds are that the market will stabilize,” Bernanke told the committee in Aug. 2007, according to the transcripts from that year. “This restrictive effect could come in various magnitudes. It could be moderate, or it could be more severe, and we are just going to have to monitor how it adjusts over time.”
The transcripts mention the word “recession” four times in January, three times in June, once in August, and 27 times in December.
U.S. Secretary of State Hillary Rodham Clinton has sent a clear warning to Beijing, which lays claim to the Senkaku Islands in the East China Sea, saying Washington opposes any unilateral action that would weaken Japan’s control of the chain.
In a joint new conference Friday after meeting with Foreign Minister Fumio Kishida at the State Department, Clinton also said the United States has invited Prime Minister Shinzo Abe to visit Washington for talks with President Barack Obama in the third week of February.
The new Liberal Democratic Party administration had sought to arrange a bilateral summit with Obama in January but gave up on the idea, in part due to the president’s tight schedule because of inaugural events for his second term.
“Although the U.S. does not take a position on the ultimate sovereignty of the (Senkaku) islands, we acknowledge they are under the administration of Japan,” Clinton said, repeating Washington is obligated under the bilateral security treaty to defend the islet group if it comes under armed attack. “We oppose any unilateral actions that would seek to undermine Japanese administration (of the Senkakus).”
It is the first time Clinton has clearly stated Washington’s opposition to altering the status quo regarding the isles, whose sovereignty is contested by both China and Taiwan. Japan purchased three of the main islets in September, effectively nationalizing the chain and enraging China.
The strong message from Washington came as Chinese planes and vessels continue to violate Japan’s airspace and waters around the uninhabited islets.
More: Little Green Footballs
Michigan Supreme Court Justice Diane Hathaway, retiring Monday after accusations of fraudulent personal real estate dealings, now faces a federal bank fraud charge for allegedly transferring a home she owned in Florida to allow for the short sale of her home in Grosse Pointe Park.
A complaint filed in U.S. District Court in Detroit Friday alleges Hathaway fraudulently transferred the real estate to others before telling financial institution ING Direct she needed to sell her Grosse Pointe Park home by short sale because she couldn’t afford the house payments.
News item. Factual content.
Just a day out for the fun of it
WASHINGTON - US President Obama’s new gun control proposals drew broad Jewish communal support.
The uniformity of the Jewish response to the proposals unveiled Wednesday stood in contrast to Republican opposition to many of the suggested measures, including a ban on assault weapons and tighter background checks on gun purchasers.
Supportive statements came from the Jewish Council for Public Affairs, the umbrella for public policy groups, as well as Reform, Conservative and Orthodox umbrella groups.
Obama said he plans to issue 23 executive orders while his vice president, Joe Biden, attempts to shepherd parallel legislation through Congress in the wake of the massacre last month of 20 children and seven adults in Newtown, Connecticut.
A number of the proposals, including hiring security officials for schools, are not controversial. But most fall on the fault line of the gun control debate that has for decades exercised the American public.
“We recognize that this is a complex issue,” Rabbi Steve Gutow, the JCPA’s president, said in a statement. “The memory of Newtown is still fresh, and so is Aurora, Tucson, Fort Hood and other massacres that remind us that something must be done — and that there isn’t a single solution to preventing mass violence. We appreciate the administration’s understanding that there are multiple causes which must be addressed. It is crucial that passions not ebb nor our country return to complacency.”
In its statement, the Orthodox Union said that it understood from conversations with White House officials that the security officials hired for schools would be available to parochial establishments as well.
“The Orthodox Union has been informed by the White House that the funding proposal may be used to place the new officers in Jewish and other nonpublic schools to provide security, counseling, and safety education,” it said in a statement.
Accidental gunfire at three gun shows around the United States on Saturday left five injured, authorities said.
Three people were injured in Raleigh, North Carolina, at the Dixie Gun and Knife Show at the state fairgrounds, a quarterly event that usually draws thousands of people. State agriculture department spokesman Brian Long said a 12-gauge shotgun discharged as its owner unzipped its case for a law enforcement officer to check at a security entrance.
Two bystanders were hit by shotgun pellets and taken to a hospital. A retired deputy sheriff suffered a slight hand injury.
More: Little Green Footballs
After 3 major tornadoes tore through the community that I have lived in since 1967, I feel compelled to write this article on how my Faith was increased after surviving 3 major tornadoes. Pratt City is the oldest community in Birmingham, and Birmingham is one of the largest cities in Alabama. The April 27th 2011 tornadoes nearly wiped my community off the map this time!
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I would love to hear similiar stories from other tornado survivors or your comments after you read my article. Feel free to share my link.
The stuff writes itself.
As gun rights activists celebrated the turnout at gun shows for national Gun Appreciation Day Saturday, police responded to at least thee accidental shootings that left five people injured at shows across the country.
A digital chart used by the minesweeper USS Guardian to navigate Philippine waters misplaced the location of a reef by about eight nautical miles, and may have been a significant factor when the ship drove hard aground on the reef on Jan. 17.
As of Jan. 18, U.S. Navy ships have been directed to “operate with caution” when using similar electronic charts and compare the map data with paper charts, which are considered accurate.
The Guardian drove onto Tubbataha Reef in the Sulu Sea around 2:25 a.m. on Jan. 17 (some sources cite a date of Jan. 16, since that was the date in Washington, D.C. when the incident occurred). The reef is about 80 miles east-southeast of Palawan Island.
Despite critics that brand him as anti-business and anti-Wall Street, President Obama’s first term in the White House has been bullish for stocks.
The Standard & Poor’s 500-stock index has risen 85% since Obama was inaugurated on Jan. 20, 2009, says S&P Capital IQ. That stellar return tops first-term gains of Obama’s past four predecessors: George. W. Bush, Bill Clinton, George H.W. Bush and Ronald Reagan.
Using the Dow Jones industrial average, Obama ranks third in first-term stock performance of all presidents; Franklin D. Roosevelt is No. 1, says Bespoke Investment Group.