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On Fox, Subprime Crisis, er, "Housing Concerns," Confined to Florida

Reported by Melanie - July 24, 2007 -

The Dow Jones fell 226.47 points today (July 24, 2007), primarily on the news that Countrywide Financial, the nation's largest mortgage lender said, "overdue payments cut profits by $388 million." Countrywide's CEO, Angelo Mozilo, elaborated: "We are experiencing home price depreciation almost like never before, with the exception of the Great Depression." Alarming, wouldn't you say? Well, not on Fox. If you watched Fox's "premiere business news" program today, you'd think the problem was, well, confined to the Miami area. And, instead of it being an issue of poor lending practices, it's more one of idiots overbuilding and idiots overbuying.

Yes, Cavuto opened with a live shot of the closing numbers on the "big board," just like a real business news show, but the information he relayed didn't contain much in the way of substance. He said Countrywide "cut its profit outlook" and the market fears that "what is just subprime may in fact border on prime as well." But, he said, "we should point out" that the Dow is "still up about 10 to 11% this year and of course, over the last 52 weeks," it's "up 25%."

Meanwhile Cavuto kept reminding his audience that Fox was awaiting the start of a "presser" by the owner of the Atlanta Falcons about the Michael Vick dogfighting situation and he assured his audience that Fox would bring that to them live, when it happened.

Next up was Brenda Buttner, Fox's "Senior Business Correspondent," who talked about that "huge housing number today," though she never told her audience what that "huge housing number was. She said, "It's not so much what happened to Countrywide Financial...but it's the fact that those loans, those subprime loans...it looks like possibly those may be extending beyond the, just that small -- and it's a very, very small part of the overall lending market -- to a larger part of the market and that really spooks Wall Street."

That didn't tell us much now did it?

Buttner went on to gleefully report that the Vanguard 500 fund is up 9% year-to-date, "but for the last three years, it is up 15% on average, every year," so, "keep that in mind. 223 points doesn't mean as much as it did when we [the Dow] were at 10,000." So, "no cause for panic but there is some concern."

From there Cavuto went to the Vick presser and then on to Roy Blunt to talk about how Democrats have "insulted" George Bush so how can they "expect to work with him," Then it was on to a roundtable discussion about the possibility that oil will reach $100.00 a barrel. The gist of that discussion was that $l00.00 per barrel would be super because everyone would stop driving and oil would immediately drop back down to $50.00 per barrel.

Next came the segment about "housing concerns." The chyron at the bottom of the screen read, "Housing Concerns Spur Sell-off in Stock Market," but the discussion was only about the over-built Miami-area housing market. The discussion centered on builders who built too many condos, not about lenders doling out mortgages to every Tom, Dick, and Harry without knowing whether they had the ability to repay them. Guest Kendra Todd said, "there are other markets that are also overbuilt but the sky is not falling on them like it is in Miami." Gary Kaltbaum said in a place like Miami, "Who came in last? The crazy speculators that would pay any price for anything hoping to sell it at a higher price three days later."

Cavuto wrapped it up by saying that lending will be restricted so "even the good guys" will be hurt. The good guys being the well-off, not the irresponsible, freeloading scums who are causing this mess (in Foxland the lenders are out of the picture in terms of blame).

Comment: Obviously Fox is dancing around this issue, hoping it goes away before they have to say much more about it. Heaven forbid we have a financial crisis under Bush's leadership; for a year now Fox has been scratching its head wondering why Bush isn't getting credit for our booming economy. Just in case this explodes, Fox is quietly building the case, as in Cavuto's "Common Sense," linked to immediately above, that irresponsible scums of the Earth are taking out mortgages they can't afford and they're wrecking things for the "good guys." The implication is that it's the poor and Hispanics and other undesirables are to blame, not corporations or Bush's (lack of) oversight.