dan19
09-12 01:52 PM
Isn't it done before LC filing?
We need to start recruitment process. For this it requires job advertisements for 5 weeks in a row, complete the recruitment process.
We need to start recruitment process. For this it requires job advertisements for 5 weeks in a row, complete the recruitment process.
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ashismaity
08-30 10:48 AM
I travelled outside USA before the expiry of VISA date while 7th yr H1b extension is going on based on my labor.
Here is the dates for clarity.
my visa date was upto Oct, 2005. Applied for H1b Extension in May, 2005. Travelled in June, 2005. came back in July 2005. Got approval for 7th yr. after a few days after my arival.
Here is the dates for clarity.
my visa date was upto Oct, 2005. Applied for H1b Extension in May, 2005. Travelled in June, 2005. came back in July 2005. Got approval for 7th yr. after a few days after my arival.
renupond
10-05 03:43 PM
Thanks for the giving link for reply. so I understand that she can work & start her own company to work as independent consultant.
Now I am curious to know..about move from H1 to EAD for her.
can she move from H1 to EAD immediately?
what are pros & cons by moving from h1 to EAD. As she already hv her SSN because of H1. do we need to inform about ead to SSN office? Also what kind of company she can have on EAD (corp,LLC)?
what is the procedure to hv own company? Steps to follow for Independent contracting? Taxes for independent contract earnings?
Also what if after a move she stopped independent contracting? two scenarios may be either join another company as employee or if she stopped working. in that case do we need to close the company?
Once she have her own company then she will work thru that company corp-to-corp or 1099??
Sorry...so many series of questions...but since this area is new.
appreciate your help.
Thanks in advance.
Now I am curious to know..about move from H1 to EAD for her.
can she move from H1 to EAD immediately?
what are pros & cons by moving from h1 to EAD. As she already hv her SSN because of H1. do we need to inform about ead to SSN office? Also what kind of company she can have on EAD (corp,LLC)?
what is the procedure to hv own company? Steps to follow for Independent contracting? Taxes for independent contract earnings?
Also what if after a move she stopped independent contracting? two scenarios may be either join another company as employee or if she stopped working. in that case do we need to close the company?
Once she have her own company then she will work thru that company corp-to-corp or 1099??
Sorry...so many series of questions...but since this area is new.
appreciate your help.
Thanks in advance.
2011 wedding invitation quotes.
greyhair
09-08 12:54 PM
Ban in private company out sourcing also is very much necessary for USA. These so called multinational companies are minting money and this is not benefitting any one except the higher executives and board of directors of those companies. and of course Politricians.
PS:- If I am in India I will never say that OS is necessary, India should grow on its own pace with her talent and brains. India should have their own economy and techonology and not OS money going around.
Great OH, baan Private OS also.
India is growing of its own, using the talent and brains partially to fulfill orders outsourced from across the world. What is wrong with that? Its a fair business practice. Back in 1980s and early 90s no one in rich countries were oppose to the idea of open business between all the countries. Back then everybody in rich countries thought that since they already have well placed institutions and larger companies, they will buy out all the local companies in smaller poor countries, creating more employment for people in rich countries. No one in the rich countries was oppose to the idea of open economies back then. Guess what. We have come a full circle now. Just because it is hurting a few million people in rich countries, all of a sudden OUTSOURCING is a curse word. Get over it people, cry as you may but outsourcing aren't stopping. Ohio is playing the election gimmicks. OH government is not outsourcing any work anyways. To the contrary, if OH was outsourcing, the State government would be more productive and without deficit.
One more thing. Outsourcing is the not reason why Indian economy is doing better than others. Because some work is outsourced to India does not simply mean outsourcing is the reason for better economy. This is a simple explanation but the wrong explanation. Indian economy is doing better because during a course of many decades, people and government have spent less than what they make/produce and more importantly, instead of throwing money on the wrong wars, they spent money on the right things. Is that so difficult to understand that we must credit outsourcing for the state of Indian economy.
PS:- If I am in India I will never say that OS is necessary, India should grow on its own pace with her talent and brains. India should have their own economy and techonology and not OS money going around.
Great OH, baan Private OS also.
India is growing of its own, using the talent and brains partially to fulfill orders outsourced from across the world. What is wrong with that? Its a fair business practice. Back in 1980s and early 90s no one in rich countries were oppose to the idea of open business between all the countries. Back then everybody in rich countries thought that since they already have well placed institutions and larger companies, they will buy out all the local companies in smaller poor countries, creating more employment for people in rich countries. No one in the rich countries was oppose to the idea of open economies back then. Guess what. We have come a full circle now. Just because it is hurting a few million people in rich countries, all of a sudden OUTSOURCING is a curse word. Get over it people, cry as you may but outsourcing aren't stopping. Ohio is playing the election gimmicks. OH government is not outsourcing any work anyways. To the contrary, if OH was outsourcing, the State government would be more productive and without deficit.
One more thing. Outsourcing is the not reason why Indian economy is doing better than others. Because some work is outsourced to India does not simply mean outsourcing is the reason for better economy. This is a simple explanation but the wrong explanation. Indian economy is doing better because during a course of many decades, people and government have spent less than what they make/produce and more importantly, instead of throwing money on the wrong wars, they spent money on the right things. Is that so difficult to understand that we must credit outsourcing for the state of Indian economy.
more...
neelu
02-09 11:27 PM
Hi
My status has changed recently from H4 to H1. I haven't got my H1 visa stamped in passport. I need to travel to India due to family emergency.
1. Can I get an emergency appointment?
2. Would I have any problem related to transit visa if travelling via Amsterdam or Frankfurt?
3. How long does it take to recieve the passport after stamping?
Any help would be greatly appreciated.
Thanks,
TEKNMEK
1. You should be able to get an emergency appointment. Check out the following links:
http://chennai.usconsulate.gov/appointments2.html
https://www.vfs-usa.co.in/Home.aspx
2. My mother recently flew via Frankfurt. She did not require a transit VISA.
3. If you get VISA stamped in India, it usually is given to you the same evening (at least in Chennai).
Hope this helps. Wish you good Luck!
My status has changed recently from H4 to H1. I haven't got my H1 visa stamped in passport. I need to travel to India due to family emergency.
1. Can I get an emergency appointment?
2. Would I have any problem related to transit visa if travelling via Amsterdam or Frankfurt?
3. How long does it take to recieve the passport after stamping?
Any help would be greatly appreciated.
Thanks,
TEKNMEK
1. You should be able to get an emergency appointment. Check out the following links:
http://chennai.usconsulate.gov/appointments2.html
https://www.vfs-usa.co.in/Home.aspx
2. My mother recently flew via Frankfurt. She did not require a transit VISA.
3. If you get VISA stamped in India, it usually is given to you the same evening (at least in Chennai).
Hope this helps. Wish you good Luck!
spicy_guy
04-07 11:49 AM
Tech firms warn of impacts of tight visa quota - MarketWatch (http://www.marketwatch.com/story/tech-firms-warn-of-impacts-of-tight-visa-quota-2011-04-07?siteid=rss&rss=1)
more...
what_now
06-03 06:09 PM
to Phoenix lockbox 4/12. It was sent to CSC. I got my card approved 5/26. Got Card on 6/3.
My wife case though still pending at CSC.:confused:
My wife case though still pending at CSC.:confused:
2010 Example Wording Of Wedding
dipu76
06-01 06:16 PM
It is illegal.
It will be great if someone can send me any reference to confirm that it is illegal..
It will be great if someone can send me any reference to confirm that it is illegal..
more...
Ann Ruben
06-29 03:00 PM
Note that you cannot legally be required to reimburse certain immigration fees such as the $1500 or $750 ACWIA fee. Also,you cannot legally be required to reimburse USCIS filing fees and/or immigration related legal fees which, when subtracted from your salary, bring your salary below the required LCA wage.
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vasa
07-16 11:50 PM
yes, everyone at hill knows that we pay taxes/abide by the law and still gets screwed because we dont have any representations!...
why is NumberUSA and other groups on CNN/FOX and other channels and our story is just passing comment..
we need to confront these people with fact check; like there is a thread for Lou Dobbs fact check.
why is NumberUSA and other groups on CNN/FOX and other channels and our story is just passing comment..
we need to confront these people with fact check; like there is a thread for Lou Dobbs fact check.
more...
sammyb
03-28 04:35 PM
Do they entertain such request - any positive (or negative) experience ... appreciate ... will be in India during May and planning to go for stamping ... mine is a 2006 job change/extension case and was wondering if the I129 made it to the PIMS or not :confused:...
I got this from different website(not sure if I can quote here).
Before going /planning for a perticular consualte, you can email the consulate with a i797 copy asking them to check if it exists in their system. If it doesn't then they will request concerned athorities to make it available in system so that you won't get stuck with PIMS delay. So far I have heard mexico/canada consualte responding to emails positively.
I will be mailing(canada consulate) them soon. Will keep you updated if i hear anything from them. if it works..its indeed a good options for us.:D
I got this from different website(not sure if I can quote here).
Before going /planning for a perticular consualte, you can email the consulate with a i797 copy asking them to check if it exists in their system. If it doesn't then they will request concerned athorities to make it available in system so that you won't get stuck with PIMS delay. So far I have heard mexico/canada consualte responding to emails positively.
I will be mailing(canada consulate) them soon. Will keep you updated if i hear anything from them. if it works..its indeed a good options for us.:D
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jonty_11
07-26 02:44 PM
check teh 'Stuck in FBI namecheck' thread on this forum..
more...
house The Wedding Invitation
spgtopper
05-09 04:08 PM
Hi dudu,
If you attend the local event on May 15th, you will be able to get a ton of local contacts that will be very useful in forming a group etc.
We are hoping that at the May 15th event, several local (DC metro area) IV members will meet and get to know each other as well - that should be a good start to form a strong local group.
S.
If you attend the local event on May 15th, you will be able to get a ton of local contacts that will be very useful in forming a group etc.
We are hoping that at the May 15th event, several local (DC metro area) IV members will meet and get to know each other as well - that should be a good start to form a strong local group.
S.
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kisana
04-11 07:55 AM
I have couple of questions
1. There is question "Have you ever applied for Online Authorization form USCIS". My answer to that is yes. But in the "Date of application" what should I write. It should be the date on which EAD was issues from EAD card, or date which apparead in receipt notice.
2. Also there is question "Please provide information concerning your eligibility status:", what should I provide in that text box.
Please suggest.
1. There is question "Have you ever applied for Online Authorization form USCIS". My answer to that is yes. But in the "Date of application" what should I write. It should be the date on which EAD was issues from EAD card, or date which apparead in receipt notice.
2. Also there is question "Please provide information concerning your eligibility status:", what should I provide in that text box.
Please suggest.
more...
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qasleuth
01-08 12:52 AM
Thank you qasleuth ..... ..... ..... ..... frack you
Just read your post and you will see the same dastardly mistakes that I supposedly made.
The difference is: I did not pre-suppose my English is perfect.
Supposedly means 'hypothetical'. You did not 'supposedly' make them, you actually did. Sentences do start with capital letters and you need commas when appropriate.
Please dont take this as a personal one off attack. I have read quite a few of your posts. Here is a good reference URL for your perusal.
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2000/01/18/MN73840.DTL
Just read your post and you will see the same dastardly mistakes that I supposedly made.
The difference is: I did not pre-suppose my English is perfect.
Supposedly means 'hypothetical'. You did not 'supposedly' make them, you actually did. Sentences do start with capital letters and you need commas when appropriate.
Please dont take this as a personal one off attack. I have read quite a few of your posts. Here is a good reference URL for your perusal.
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2000/01/18/MN73840.DTL
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xela
06-08 12:45 PM
Anyone heard anything yet?
Supposedly they take a max of 11 weeks but it worries me that I do not even see any LUDs.
I guess it is a waiting game just like everything else with them.
Supposedly they take a max of 11 weeks but it worries me that I do not even see any LUDs.
I guess it is a waiting game just like everything else with them.
more...
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kumar1
10-06 01:15 PM
USCIS has always been unpredictable. Stupid USCIS approved Mohammed Atta's VISA extension after he shoved the whole airplane in World Trade Tower. So all of us know, what USCIS is capable of doing. I would go to an extent that you can even remain unemployed after 180 days of I-485. You do not even have the burden to be employed all the time.
Once again....I am talking about what law says.
USCIS is recently rejecting strait forward EAD/AC21 cases...and u think if they RFE all ur paystubs and see a period of McDonald's employment...they will not deny the 485....
U will be lucky if they dont!!!!
With a weak economy ...and layoffs..bias against would be immigrants is going to be even more pronounced...Hard times are ahead...
Once again....I am talking about what law says.
USCIS is recently rejecting strait forward EAD/AC21 cases...and u think if they RFE all ur paystubs and see a period of McDonald's employment...they will not deny the 485....
U will be lucky if they dont!!!!
With a weak economy ...and layoffs..bias against would be immigrants is going to be even more pronounced...Hard times are ahead...
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pamposh
10-26 08:34 AM
Do not believe on online status. Couple of my frds got their EAD and still online status is " Case Received and Pending". Looks like they are not updating the status on regular basis.
I am one of those as well. My online status shows the regular "case received on so n so" message. I got my EAD about 10 days ago n so is with my spouse.
I am one of those as well. My online status shows the regular "case received on so n so" message. I got my EAD about 10 days ago n so is with my spouse.
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a_yaja
01-06 04:39 PM
My wife is on H4 and is exploring the posibility of converting to a H1. She recently went for her first interview and the people over there told her that there is a new rule for H4 to H1B conversion. According to them, she needs to go to India and get her H1B stamped before she can start working. Is this true? As far as I know, all one needs is an approved I-797 (for I-129 petition) indicating that the approval is for change of status to H1B (meaning that the approval notice has a I-94).
Please let me know if there is any merit in the above statement?
Please let me know if there is any merit in the above statement?
waitforgc1
05-07 11:39 AM
Me and my wife also have LUD on 04/23/2009. And my priority date is Nov 2004
I think based on the information on other threads its usually normal nothing
can be derived of that LUD.
I think based on the information on other threads its usually normal nothing
can be derived of that LUD.
alkg
08-13 08:41 PM
see the paragraph in bold letters.................
Greenspan Sees Bottom
In Housing, Criticizes Bailout
August 14, 2008
WASHINGTON -- Alan Greenspan usually surrounds his opinions with caveats and convoluted clauses. But ask his view of the government's response to problems confronting mortgage giants Fannie Mae and Freddie Mac, and he offers one word: "Bad."
In a conversation this week, the former Federal Reserve chairman also said he expects that U.S. house prices, a key factor in the outlook for the economy and financial markets, will begin to stabilize in the first half of next year.
"Home prices in the U.S. are likely to start to stabilize or touch bottom sometime in the first half of 2009," he said in an interview. Tracing a jagged curve with his finger on a tabletop to underscore the difficulty in pinpointing the precise trough, he cautioned that even at a bottom, "prices could continue to drift lower through 2009 and beyond."
A long-time student of housing markets, Mr. Greenspan now works out of a well-windowed, oval-shaped office that is evidence of his fascination with the housing market. His desk, couch, coffee table and conference table are strewn with print-outs of spreadsheets and multicolored charts of housing starts, foreclosures and population trends siphoned from government and trade association sources.
An end to the decline in house prices, he explained, matters not only to American homeowners but is "a necessary condition for an end to the current global financial crisis" he said.
"Stable home prices will clarify the level of equity in homes, the ultimate collateral support for much of the financial world's mortgage-backed securities. We won't really know the market value of the asset side of the banking system's balance sheet -- and hence banks' capital -- until then."
At 82 years old, Mr. Greenspan remains sharp and his fascination with the workings of the economy undiminished. But his star no longer shines as brightly as it did when he retired from the Fed in January 2006.
Mr. Greenspan has been criticized for contributing to today's woes by keeping interest rates too low too long and by regulating too lightly. He has been aggressively defending his record -- in interviews, in op-ed pieces and in a new chapter in his recent book, included in the paperback version to be published next month. Mr. Greenspan attributes the rise in house prices to a historically unusual period in which world markets pushed interest rates down and even sophisticated investors misjudged the risks they were taking.
His views remain widely watched, however. Mr. Greenspan's housing forecast rests on two pillars of data. One is the supply of vacant, single-family homes for sale, both newly completed homes and existing homes owned by investors and lenders. He sees that "excess supply" -- roughly 800,000 units above normal -- diminishing soon. The other is a comparison of the current price of houses -- he prefers the quarterly S&P Case Shiller National Home Price Index because it includes both urban and rural areas -- with the government's estimate of what it costs to rent a single-family house. As other economists do, Mr. Greenspan essentially seeks to gauge when it is rational to own a house and when it is rational to sell the house, invest the money elsewhere and rent an identical house next door.
"It's the imbalance of supply and demand which causes prices to go down, but it's ultimately the valuation process of the use of the commodity...which tells you where the bottom is," Mr. Greenspan said, recalling his days trading copper a half century ago. "For example, the grain markets can have a huge excess of corn or wheat, but the price never goes to zero. It'll stabilize at some level of prices where people are willing to hold the excess inventory. We have little history, but the same thing is surely true in housing as well. We will get to the point where there will be willing holders of vacant single-family dwellings, and that will no longer act to depress the price level."
The collapse in home prices, of course, is a major threat to the stability of Fannie and Freddie. At the Fed, Mr. Greenspan warned for years that the two mortgage giants' business model threatened the nation's financial stability. He acknowledges that a government backstop for the shareholder-owned, government-sponsored enterprises, or GSEs, was unavoidable. Not only are they crucial to the ailing mortgage market now, but the Fed-financed takeover of investment bank Bear Stearns Cos. also made government backing of Fannie and Freddie debt "inevitable," he said. "There's no credible argument for bailing out Bear Stearns and not the GSEs."
His quarrel is with the approach the Bush administration sold to Congress. "They should have wiped out the shareholders, nationalized the institutions with legislation that they are to be reconstituted -- with necessary taxpayer support to make them financially viable -- as five or 10 individual privately held units," which the government would eventually auction off to private investors, he said.
Instead, Congress granted Treasury Secretary Henry Paulson temporary authority to use an unlimited amount of taxpayer money to lend to or invest in the companies. In response to the Greenspan critique, Mr. Paulson's spokeswoman, Michele Davis, said, "This legislation accomplished two important goals -- providing confidence in the immediate term as these institutions play a critical role in weathering the housing correction, and putting in place a new regulator with all the authorities necessary to address systemic risk posed by the GSEs."
But a similar critique has been raised by several other prominent observers. "If they are too big to fail, make them smaller," former Nixon Treasury Secretary George Shultz said. Some say the Paulson approach, even if the government never spends a nickel, entrenches current management and offers shareholders the upside if the government's reassurance allows the companies to weather the current storm. The Treasury hasn't said what conditions it would impose if it offers Fannie and Freddie taxpayer money.
Fear that financial markets would react poorly if the U.S. government nationalized the companies and assumed their approximately $5 trillion debt is unfounded, Mr. Greenspan said. "The law that stipulates that GSEs are not backed by the full faith and credit of the U.S. government is disbelieved. The market believes the government guarantee is there. Foreigners believe the guarantee is there. The only fiscal change is for someone to change the bookkeeping."
In the past, to be sure, Mr. Greenspan's crystal ball has been cloudy. He didn't foresee the sharp national decline in home prices. Recently released transcripts of Fed meetings do record him warning in November 2002: "It's hard to escape the conclusion that at some point our extraordinary housing boom...cannot continue indefinitely into the future."
Publicly, he was more reassuring. "While local economies may experience significant speculative price imbalances, a national severe price distortion seems most unlikely in the United States, given its size and diversity," he said in October 2004. Eight months later, he said if home prices did decline, that "likely would not have substantial macroeconomic implications." And in a speech in October 2006, nine months after leaving the Fed, he told an audience that, though housing prices were likely to be lower than the year before, "I think the worst of this may well be over." Housing prices, by his preferred gauge, have fallen nearly 19% since then. He says he was referring not to prices but to the downward drag on economic growth from weakening housing construction.
Mr. Greenspan urges the government to avoid tax or other policies that increase the construction of new homes because that would delay the much-desired day when home prices find a bottom.
He did offer one suggestion: "The most effective initiative, though politically difficult, would be a major expansion in quotas for skilled immigrants," he said. The only sustainable way to increase demand for vacant houses is to spur the formation of new households. Admitting more skilled immigrants, who tend to earn enough to buy homes, would accomplish that while paying other dividends to the U.S. economy.
He estimates the number of new households in the U.S. currently is increasing at an annual rate of about 800,000, of whom about one third are immigrants. "Perhaps 150,000 of those are loosely classified as skilled," he said. "A double or tripling of this number would markedly accelerate the absorption of unsold housing inventory for sale -- and hence help stabilize prices."
http://online.wsj.com/article/SB121865515167837815.html?mod=hpp_us_whats_news
Greenspan Sees Bottom
In Housing, Criticizes Bailout
August 14, 2008
WASHINGTON -- Alan Greenspan usually surrounds his opinions with caveats and convoluted clauses. But ask his view of the government's response to problems confronting mortgage giants Fannie Mae and Freddie Mac, and he offers one word: "Bad."
In a conversation this week, the former Federal Reserve chairman also said he expects that U.S. house prices, a key factor in the outlook for the economy and financial markets, will begin to stabilize in the first half of next year.
"Home prices in the U.S. are likely to start to stabilize or touch bottom sometime in the first half of 2009," he said in an interview. Tracing a jagged curve with his finger on a tabletop to underscore the difficulty in pinpointing the precise trough, he cautioned that even at a bottom, "prices could continue to drift lower through 2009 and beyond."
A long-time student of housing markets, Mr. Greenspan now works out of a well-windowed, oval-shaped office that is evidence of his fascination with the housing market. His desk, couch, coffee table and conference table are strewn with print-outs of spreadsheets and multicolored charts of housing starts, foreclosures and population trends siphoned from government and trade association sources.
An end to the decline in house prices, he explained, matters not only to American homeowners but is "a necessary condition for an end to the current global financial crisis" he said.
"Stable home prices will clarify the level of equity in homes, the ultimate collateral support for much of the financial world's mortgage-backed securities. We won't really know the market value of the asset side of the banking system's balance sheet -- and hence banks' capital -- until then."
At 82 years old, Mr. Greenspan remains sharp and his fascination with the workings of the economy undiminished. But his star no longer shines as brightly as it did when he retired from the Fed in January 2006.
Mr. Greenspan has been criticized for contributing to today's woes by keeping interest rates too low too long and by regulating too lightly. He has been aggressively defending his record -- in interviews, in op-ed pieces and in a new chapter in his recent book, included in the paperback version to be published next month. Mr. Greenspan attributes the rise in house prices to a historically unusual period in which world markets pushed interest rates down and even sophisticated investors misjudged the risks they were taking.
His views remain widely watched, however. Mr. Greenspan's housing forecast rests on two pillars of data. One is the supply of vacant, single-family homes for sale, both newly completed homes and existing homes owned by investors and lenders. He sees that "excess supply" -- roughly 800,000 units above normal -- diminishing soon. The other is a comparison of the current price of houses -- he prefers the quarterly S&P Case Shiller National Home Price Index because it includes both urban and rural areas -- with the government's estimate of what it costs to rent a single-family house. As other economists do, Mr. Greenspan essentially seeks to gauge when it is rational to own a house and when it is rational to sell the house, invest the money elsewhere and rent an identical house next door.
"It's the imbalance of supply and demand which causes prices to go down, but it's ultimately the valuation process of the use of the commodity...which tells you where the bottom is," Mr. Greenspan said, recalling his days trading copper a half century ago. "For example, the grain markets can have a huge excess of corn or wheat, but the price never goes to zero. It'll stabilize at some level of prices where people are willing to hold the excess inventory. We have little history, but the same thing is surely true in housing as well. We will get to the point where there will be willing holders of vacant single-family dwellings, and that will no longer act to depress the price level."
The collapse in home prices, of course, is a major threat to the stability of Fannie and Freddie. At the Fed, Mr. Greenspan warned for years that the two mortgage giants' business model threatened the nation's financial stability. He acknowledges that a government backstop for the shareholder-owned, government-sponsored enterprises, or GSEs, was unavoidable. Not only are they crucial to the ailing mortgage market now, but the Fed-financed takeover of investment bank Bear Stearns Cos. also made government backing of Fannie and Freddie debt "inevitable," he said. "There's no credible argument for bailing out Bear Stearns and not the GSEs."
His quarrel is with the approach the Bush administration sold to Congress. "They should have wiped out the shareholders, nationalized the institutions with legislation that they are to be reconstituted -- with necessary taxpayer support to make them financially viable -- as five or 10 individual privately held units," which the government would eventually auction off to private investors, he said.
Instead, Congress granted Treasury Secretary Henry Paulson temporary authority to use an unlimited amount of taxpayer money to lend to or invest in the companies. In response to the Greenspan critique, Mr. Paulson's spokeswoman, Michele Davis, said, "This legislation accomplished two important goals -- providing confidence in the immediate term as these institutions play a critical role in weathering the housing correction, and putting in place a new regulator with all the authorities necessary to address systemic risk posed by the GSEs."
But a similar critique has been raised by several other prominent observers. "If they are too big to fail, make them smaller," former Nixon Treasury Secretary George Shultz said. Some say the Paulson approach, even if the government never spends a nickel, entrenches current management and offers shareholders the upside if the government's reassurance allows the companies to weather the current storm. The Treasury hasn't said what conditions it would impose if it offers Fannie and Freddie taxpayer money.
Fear that financial markets would react poorly if the U.S. government nationalized the companies and assumed their approximately $5 trillion debt is unfounded, Mr. Greenspan said. "The law that stipulates that GSEs are not backed by the full faith and credit of the U.S. government is disbelieved. The market believes the government guarantee is there. Foreigners believe the guarantee is there. The only fiscal change is for someone to change the bookkeeping."
In the past, to be sure, Mr. Greenspan's crystal ball has been cloudy. He didn't foresee the sharp national decline in home prices. Recently released transcripts of Fed meetings do record him warning in November 2002: "It's hard to escape the conclusion that at some point our extraordinary housing boom...cannot continue indefinitely into the future."
Publicly, he was more reassuring. "While local economies may experience significant speculative price imbalances, a national severe price distortion seems most unlikely in the United States, given its size and diversity," he said in October 2004. Eight months later, he said if home prices did decline, that "likely would not have substantial macroeconomic implications." And in a speech in October 2006, nine months after leaving the Fed, he told an audience that, though housing prices were likely to be lower than the year before, "I think the worst of this may well be over." Housing prices, by his preferred gauge, have fallen nearly 19% since then. He says he was referring not to prices but to the downward drag on economic growth from weakening housing construction.
Mr. Greenspan urges the government to avoid tax or other policies that increase the construction of new homes because that would delay the much-desired day when home prices find a bottom.
He did offer one suggestion: "The most effective initiative, though politically difficult, would be a major expansion in quotas for skilled immigrants," he said. The only sustainable way to increase demand for vacant houses is to spur the formation of new households. Admitting more skilled immigrants, who tend to earn enough to buy homes, would accomplish that while paying other dividends to the U.S. economy.
He estimates the number of new households in the U.S. currently is increasing at an annual rate of about 800,000, of whom about one third are immigrants. "Perhaps 150,000 of those are loosely classified as skilled," he said. "A double or tripling of this number would markedly accelerate the absorption of unsold housing inventory for sale -- and hence help stabilize prices."
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