Jeb Bush and the Subprime Mortgage Crisis

The Huckster and the Wreckage


It was a classic run on the bank. Until his recent resignation under fire, Coleman Stipanovich, a Bush loyalist, headed the Florida State Board of Administration, responsible for investing billions of dollars of state funds. Stipanovich’s brother, “Mac”, is a former chief of staff in the governor’s office, Jeb Bush campaign manager, and now partner in the law firm, Fowler White, Boggs-the Tallahassee lobbying whip of the Growth Machine (he is also board member of US Sugar).

Jeb Bush left Tallahassee for Miami in January 2007, having served two terms as governor. He incorporated Jeb Bush & Co., and in June was hired as a consultant with Lehman Brothers, the Wall Street investment banking firm.

In July and August, Stipanovich approved the purchase of $842 million in securitized mortgage bonds from Lehman.

Today the value of those bonds is practically zero, vanished in the debt crisis that is tipping the national economy into a recession.

So far, the media is buying the state spin: that Florida’s municipalities made their own decisions to invest with the state government investment pool. Senate President Ken Pruitt, another Bush loyalist, huffily defended the state investment pool with Indian River county officials, “No one put a gun to your head.”

But that is only half of the story, as any investor knows: the other half is that the state was fiduciary and obligated to invest those funds within tolerable risk parameters.

Any fiduciary that bothered with due diligence could see in the overdevelopment of Florida that the bubble in housing markets would pop, and that financial instruments that created the bubble would vanish into the ether.

The mortgage derivatives were only as good as their ratings, and their ratings and insurance were administered through incestuous relationships with originators on Wall Street, like Lehman.

The suburban housing bubble was a function-not of market demand-but of insider politics and campaign contributions that persuaded everyone involved to “mis-price risk” (risk to families, risk to wetlands, risk to government infrastructure budgets) leading to the theft of quality of life, the environment, and an equitable future.


Mitt’s campaign money comes from outsourcing jobs, saddling companies with debt they can’t repay and laying off thousands of workers?

Mitt Romney – Troubles Ahead Because of Troubles Behind – Part 1One of the problems that lies ahead of Romney is what lies behind that fortune. He hasn’t run a “corner store” or a company that manufactures things or sells things or even provided a service. He ran Bain Capital, a leveraged buyout firm. Think the movie Wall Street and Gordon Gecko.This from a New York Times Article.

“Mitt ran a private equity firm, not a cement company,” said Eric A. Kriss, a former Bain Capital partner. “He was not a businessman in the sense of running a company,” Mr. Kriss said, adding, “He was a great presenter, a great spokesman and a great salesman.”

Mr. Romney learned the perils of campaigning on his business career in his first run for office, when accusations that Bain Capital had fired union workers at an Indiana company it controlled derailed his effort to unseat Senator Edward M. Kennedy, a Democrat, in 1994. “Basically, he cut our throats,” a laid-off worker said in a commercial attacking Mr. Romney.

Bain and its co-investors extracted special payments of over $100 million from each company, enabling Bain to make a healthy profit even before re-selling the businesses — a practice known as “getting back your bait.” Lenders say Bain is one of the firms that has taken the most in such payments, which companies usually make by taking on additional debt.

So when Mitt Romney campaigns on money borrowed from his personal fortune, let’s rememeber and remind others where that money came from. It came from outsourcing jobs, saddling companies with debt they could never repay and laying off thousands of workers.

Evangelical Outpost did the homework on Romney…. and says NO.


Listed below are just some of the reasons why I think [ Romney ] is an unacceptable choice to be President. The list is lengthy but not exhaustive.

I’m certain the tanking of the economy wasn’t intentional. Why would someone manipulate financial markets?

Hmmm, Foreclosures soared 75% in 2007 – the year the elections begin. 75%. Would that create a economic downturn just in time for – hmmm, lets see…..who is the Economic Guy ??? McCain? Huck? Fred? Obama? Clintoness? What if it gets really really worse? Then, we stop talking about EVERYTHING else. And look how very fast we are bailing people out. Wow, Country Wide lucked out with that buyout by Bank of A. I doubt that was planned in advance. They aren’t that evil. Why do I smell sulfer?  Maybe someone is cooking something.
Posted: 02:52 PM ET
LONDON (CNN) — European leaders have agreed that there is a pressing need for more transparency and a better early warning system for the global economy, Prime Minister Gordon Brown told reporters Tuesday after meeting with the leaders of France, Italy and the European Community.


January 29th, 2008
Posted: 05:03 AM ET
(CNN) — The number of foreclosures soared in 2007, with 405,000
households losing their home, according to a report released Tuesday.

Bush Tax Rebates buys exactly 10 months of time.

Ooooops, the plan ignores the poorest of Americans. The ones who don’t make enough to pay taxes.

Oh well. They’ll figure something out. You can buy Ramen on sale at the Kroger – 10 for a dollar.

See, there’s a silver lining for everyone.


So many smart men. So many smart ideas.

Wait- what? Bush wants tax rebate now- but my tax refund may be delayed?

Fed chairman has spoken. Eveybody at attention please. Who’s getting the new and immediate tax rebate? And why would they be offering an immediate tax rebate when they just finished saying our tax refunds would be delayed? Are they going to finance the rich’s tax rebate with the middle class tax delay? And define delay.