An Argument Against The Bailout – By: Cody Willard

It doesn’t take much to get Cody Willard riled up about the $700 billion Wall Street bailout package recently defeated by the U.S. House of Representatives.

“We’ve had 200 years of private ownership of profits and losses, and somewhere, we came up with the idea that we could never have a down year,” Willard said. “Not every year will be an up year.”

Willard, a Ruidoso native who co-hosts the show “Happy Hour” on the Fox Business Network in New York, was in town Monday and Tuesday, working on a feature on his hometown.

The assignment will give him a chance to show off the village he called home until his high school graduation in 1991, but he’s made a name for himself in the concrete canyons of New York City, both as a financial analyst for Fox and as the founder of an investment management company.

As such, when Willard speaks about the state of the national economy – and the government’s attempt to bail out some major investment firms – his word stands to carry some weight.

“If the Depression taught us anything, it’s that government socialism only exacerbates the problem,” Willard said. “This would be the greatest redistribution of wealth upward in the country’s history. There’s nothing beneficial to anyone but the big firms on Wall Street.”

Unsurprisingly, Willard isn’t in favor of the proposal, which was voted down by lawmakers in Washing-ton on Monday, but is likely to be re-introduced soon with significant changes.

“I don’t think we’ll be able to stop it this time,” Willard said. “It will be tough to beat, but then I thought the first bill wouldn’t be defeated, either.”

Willard has written several articles on the proposed bill on the http://www.foxbusiness.com Web site, and has reported about 99 percent of all comments are in agreement with him against the bailout package.

His most recent post was written while in Ruidoso, in which he reported a majority of the locals are against the bill as well.

“I don’t know a single person here who is for the bailout,” Willard writes. “A well-off elderly couple even laughed today when I asked if they thought they’d have trouble getting a loan from the local bank if Wall Street isn’t bailed out.

“I said, ‘what’s funny?’ They said their local bank hasn’t overextended itself and has prepared itself for the just-started local real estate downturn and that they’ve got capital to put down if they wanted to.”

That comment illustrates what Willard believes about the national economy – that it runs not on the backs of major investment firms in New York, but on the hard work and ingenuity of small businesses and small investors throughout the country.

“The small businesses that are the lifeblood of small communities like this are also the life blood of the country,” Willard said. “Taxing them to bail out big banks and investment firms can’t help anybody.”

http://www.ruidosonews.com/news/ci_10603025

You Want Free Market Solutions? You Got ‘Em!

You Want Free Market Solutions? You Got ‘Em!

By Cody Willard

So what’s the alternative to extorting a trillion dollars from middle America for the sole direct benefit of rich bankers and NYC?

1. Suspend FASB 157 which earlier this year, because it requires ibanks to value their mortgage junk that’s being puked at 6 cents on the dollar at places like Merrill Lynch, contributed to the virtuous cycles now turned vicious.

2. Bring back the uptick rule. Shortselling a company is fine and dandy…but pounding down on a stock in an illiquid market by relentless shorting into whatever bids are out there has been a big factor in how quickly Lehman and others failed.

3. Let the billions of brilliant people on this planet take advantage of the concepts of private ownership and the ability to profit therein as this vicious cycle creates huge opportunities for everybody. That’s really the single biggest issue I’ve got with all these fear-mongering socialists who seem to see this economy and the people in it as a static blip on a chart. Take Bill Gross at PIMCO (please take him — I’m talking to you, Communist China, he’ll fit right in with you guys now that he’s a huge advocate of central allocation of capital and all with this bailout bill) has about a trillion dollars under management. He wrote in an editorial that he thought the government would make a ton of money if they’d give the insolvent banks 60 cents on the dollar for that stuff that’s trading at 6 cents on the dollar right now. If he truly thinks that, then I’m pretty sure he could figure out a way to sell enough Treasuries and government bonds back to the government and raise enough capital from private investors that he could make that 60 cents on the dollar bet himself. Privately, without extorting capital from middle America.

4. Moreover, how about we let the little geniuses out there create small businesses that can take advantage of the opportunities now being created in the financial industry instead of expecting the guys with absolutely wild conflicts of interest who are in utter panic mode (Paulson, Bernanke, Bush, Pelosi, Hilary et al) to be productive at fixing the system.

I mean, after speaking for about half an hour offline with true-freedom lover and former Treasury Secretary, Paul O’Neil, discussing this stuff the other day, I heard several of the former-freedom-loving rich white dudes you see on TV who have taken to begging you for your tax dollars actually start to discuss some ways they could privately profit off this Wall Street Crisis of 2008.

I personally am thinking about starting a website called “MyUnderWaterMortgage.com” where people can privately pool their underwater mortgages — perhaps by vintage or location or state or something if there’s enough critical mass — and then those underwater mortgages could be packaged and sold to private investors who then pay off the banks who will simply be thrilled to get some cash that’s not 6 cents on the dollar for this mortgages. And I’m just one cowboy who came up with that one idea in just one night. Hey you fear mongering commies who keep telling us that if you don’t have complete control of the industry that we’re going into a Great Depression: LEAVE US ALONE. LEAVE THE SYSTEM ALONE. LET US GET BACK TO WORK!

PS. Here’s an article from my local newspaper with more of my take on this stuff.

http://cody.blogs.foxbusiness.com/2008/10/01/you-want-free-market-solutions-you-got-em/

You can watch Cody at 5:00 PM (est) on Fox Business Channel’s “Happy Hour”.

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