Today's big news is that the automaker bailout failed to pass through the Senate last night. The Asian markets did not like that, they dropped 5% for the day. Europe is down around 4% as I write this and the futures for the US are pointing down better than 3% premarket. Whatever your feelings about the recent activities of our Federal Government, today or more correctly the vote last night will be a point in history that will be studied for years to come. Along with the changes in mortgage rules around the first of March 2007, because we probably have just had a life changing event occur. If an automaker like GM fails what will the ripple affects be? A place like Atlanta where the US manufactureers have already pulled out we won't feel the plant closures directly. But Atlanta has a great deal of auto related business and it will be affected.

More importantly, what will fill the jobs void that would be left is a GM or Chrysler ceased operations? I think some enterprises souls would pick up some of the pieces out of bankruptcy and put some of the skilled folks to work but not all of them.

It will be fun to see what this day brings

I'm usually the last person to start talking about other people's greed because I figure who am I to judge but man, the news of the last week makes it hard. First this attorney Drier allegedly does a $100 million fraud on some hedge funds. Then the Illinois Governor. And now today this Bernard Madoff guy. He has been on Wall Street for decades, former Chairman of NASDAQ, the guy is 70, raises some red flags because he decides to distribute bonuses early and tells some his senior staff its because he has a few hundred million left and he wants to give it away before he turns himself in. Huh? What'd you say? Then says his business is a multi billion dollar ponzi scheme. Well I guess that is not really a surprise. This is Wall Street after all!
These are weird times we are living in. Through all of this I think we will end up with people of better character and simpler lifestyles and it will be a good thing!

What Planet am I on? I chose that name because sometimes the news is just so unbelievable. Today is positively one of those days. The Democrat Governor of Illnois, Rod R. Blagojevich, was arrested this morning after weeks of investigation by the Feds over campaign fundraising and more significantly a "pay for play" scheme to fill the Senate seat vacated by President Elect Obama. The charges if true paint a pretty terrible picture of the Governor and his contempt for his office and the people of Illnois. Also interesting are some of the references quote in the unsealed documents to apparent discussions with the transition team about their preference for who should fill Obama's seat.

Then to top it all off there is a subpoena for records related to the Rezko land deal involving Obama's purchase of his house.

Will Obama pardeon the Gov? Rezko? Can Obama pardon himself?

Uh Oh! The U.S. Office of the Comptroller of the Currency head, John Dugan, said in prepared remarks that "Put simply, it shows that over half of mortgage modifications seemed not to be working after six months". Well gosh - who knew? When folks are massively underwater and their incomes are declining and the basics of life like food and fuel are rising-even with modifications people can't keep up with their mortgages. Sooner or later people are going to figure it out. Even in California and New York and other high priced places, the population only has so much money. In California the median income for a family of 4 is $75K. Same in New York. How is a family of 4 going to live on that and pay a $5K per month mortgage. They can't and are not. No amount of modification and change this!

Also mentioned in Mr. Dugans' prepared remarks was this "...the report will also show that the greatest delinquencies were in prime mortgages..." Ouch!

So Senator Dodd says there has to be a change in leadership at GM before a bailout because Wagoner and company have led GM right to where they are now. Whether you agree or disagree, one has to wonder how Dodd might feel if the same logic were applied by the American people to Congress, after all they've certainly contributed to a few problems here!