One Quarter Percent Rake Hike: Layoffs and No Dream Houses --7/1/2004-- Media Research Center

1. One Quarter Percent Rate Hike: Layoffs and No Dream Houses The Federal Reserve Board on Wednesday hiked its federal funds rate by a quarter point to 1.25 percent, returning it to where it stood in June of last year, and still at a historically low level. But while NBC’s Anne Thompson described the decision as “a vote of confidence in the recovery from the Federal Reserve,” the CBS Evening News stressed the negative. Anthony Mason declared: “The era of cheap money is over.” He ran through a dire forecast: “Your credit card interest rate will be rising. So will adjustable rate mortgages...” As video showed empty desks in an office, Mason bemoaned how rising mortgage rates have “put the brakes on the refinancing boom and left empty desks and mortgage brokers. Bank of America cut 500 mortgage processing jobs this month, and the industry has been laying off thousands.” The other networks were no where near as negative, but all managed to find victims of potentially higher interest rates. ABC’s Barbara Pinto, for instance, focused on a couple trying to build a house: “As rates rise, their dream home is shrinking.”

2. ABC’s Gibson Paints Surprise Handover as Sign of Failure Still trying to paint the handover in Iraq as a sign of failure. ABC’s Charlie Gibson lectured Paul Bremer, the former U.S. Administrator in Iraq, about how “I can imagine that when you arrived in Iraq for the first time, you envisioned someday a ceremony with bands playing and crowds cheering, and control returned to the Iraqis,” but “instead it happened in secret, in a small room so as to disrupt potential terrorists.” Gibson asked on Wednesday’s Good Morning America: “Is that a sad commentary on where we stand with security?”

3. FNC Reveals How Moore Distorted Scene with Bush at Golf Course The TV ads for Michael Moore’s “documentary” Fahrenheit 9/11 feature a mocking clip of President Bush on a golf course. Bush declares, “I call upon all nations to do everything they can to stop these terrorists killers,” and then Moore jumps to Bush adding, as he prepares to swing at a golf ball, “now watch this drive.” Tuesday night on FNC’s Special Report with Brit Hume, Brian Wilson noted how “the viewer is left with the misleading impression Mr. Bush is talking about al-Qaeda terrorists.” But Wilson disclosed that “a check of the raw tape reveals the President is talking about an attack against Israel, carried out by a Palestinian suicide bomber.” Last Friday, NBC’s Lisa Myers also ran through some of Moore’s other distortions.

4. Today Airs Katie Playing Badminton Over New Saddam Hussein Video The Today show’s parallel universe. Thursday morning at 8:30am EDT, ABC’s Good Morning America, CBS’s The Early Show, as well as MSNBC, CNN’s American Morning and FNC’s Fox & Friends, all aired the taped video just released out of Iraq showing Saddam Hussein in the courtroom, the first video of Hussein since the video of a scraggly Hussein in December just after he was found in a hole. But Today viewers instead saw Katie Couric playing badminton.

One Quarter Percent Rate Hike: Layoffs
and No Dream Houses

The Federal Reserve Board on Wednesday hiked its federal funds rate by a quarter point to 1.25 percent, returning it to where it stood in June of last year, and still at a historically low level -- it was at 6.5 percent in 2000. But while NBC’s Anne Thompson described the decision as “a vote of confidence in the recovery from the Federal Reserve,” the CBS Evening News stressed the negative. Anthony Mason declared: “The era of cheap money is over.” He ran through a dire forecast: “Your credit card interest rate will be rising. So will adjustable rate mortgages. And say goodbye to those zero percent auto loans.”

As video showed empty desks in an office, Mason bemoaned how rising mortgage rates have “put the brakes on the refinancing boom and left empty desks and mortgage brokers. Bank of America cut 500 mortgage processing jobs this month, and the industry has been laying off thousands.” Mason ominously concluded: “This era of low interest rates is beginning to appear in the rear view mirror. And economists say it could be decades before we encounter another one.”

(The “federal funds” rate, as the AP described it, is “the interest that banks charge each other on overnight loans” and “is the Fed's primary tool for influencing economic activity.”)

All the other networks were no where near as negative, but all managed to find victims of potentially higher interest rates.

ABC’s Barbara Pinto began her June 30 World News Tonight story: “Armed with the cheapest cash in nearly half a century, Americans have been spending on everything from homes to cars. Today, the Fed is tapping on the brakes, raising rates to slow the growing economy and curb inflation.”

But though she noted that “rates are still historically low,” she asserted that a quarter percent hike is a lot for a couple which owes tens of thousands on credit cards and so will pay hundreds more in interest each year. Over video of a couple looking over architectural drawings, a couple with a variable rate loan to build a house in Texas, Pinto concluded her story on a very downbeat note about how higher rates will mean they can’t afford as large a loan: “As rates rise, their dream home is shrinking.”

People building a home in the 1990s would dream of a rate as low as a point higher than today’s rates.

On the NBC Nightly News, Anne Thompson began on an upbeat theme: “Today, a vote of confidence in the recovery from the Federal Reserve. The quarter point hike taking the short term rate up from its 46 year low of one percent is the first step in what the Fed signaled will be a slow, steady climb to keep inflation in check and the economy growing.”

Thompson, however, soon found a dark side, highlighting the Taylors, a couple with a home equity loan and $25,000 in credit card debt. Thompson warned: “And mortgage rates, while not directly tied to what the Fed does, are already up nearly a percentage point since March, a worry for the Taylors who are in the market for a new house.”

If they have already borrowed for a home equity loan and have tallied up $25,000 in credit card debt, a slightly higher rate on a potential mortgage is the least of their problems.

“This is still an incredibly low interest rate,” CNN’s Kathleen Hays asserted on NewsNight of the 1.25 percent rate as she recalled how the federal funds rate was as high as 6.5 percent as recently as 2000.

But CNN followed up with a piece from Jonathan Freed about a supposed victim of higher mortgage rates: “It’s the home they wanted, it’s the home they bought, but now Michael Karnuth and his fiance aren’t convinced it’s a home they can afford....The couple’s been waiting to lock in their mortgage rate. Now, they say, they’re kicking themselves. They’re not alone...”

Now, a full rundown of the story which led the June 30 CBS Evening News. From Baghdad, Dan Rather began:
“Good evening. The new interim government here in Iraq today took custody of Saddam Hussein. No longer a prisoner of war, now a criminal defendant who will face trial for a long list of atrocities. We’ll have more about that in a moment. But first, important news back home. The Federal Reserve today raised interest rates for the first time in four years, a quarter of a point increase aimed at keeping inflation in check. CBS’s Anthony Mason reports on the rising cost of borrowed money.”

     Mason began, as taken down by the MRC’s Brad Wilmouth: “The era of cheap money is over. Your credit card interest rate will be rising. So will adjustable rate mortgages. And say goodbye to those zero percent auto loans. For the first time in four years, the Fed has raised interest rates by a quarter of a point.”
     Lyle Gramley, Schwab Washington Research Group: “Interest rates clearly are in an upward direction now and probably will continue to move up through the next year and a half or two years.”
     Mason: “Mortgage rates already have been rising. The 30-year fixed, which fell to 5.3 percent back in March, is now almost a full point higher, and many predict will pass 7 percent next year. That’s put the brakes on the refinancing boom and [video of empty desks] left empty desks and mortgage brokers. Bank of America cut 500 mortgage processing jobs this month, and the industry has been laying off thousands.”
     Doug Duncan, Mortgage Bankers Association chief economist: “We would expect to see another 50,000 to 60,000, perhaps a total of 80,000 job losses from the peak to the bottom.”
     Mason: “Higher interest rates will be good news for savers who’ll get higher returns on their money markets or CDs, but bad news for borrowers, and credit card debt and delinquency rates have been soaring.”
     Mark Zandi, Economy.com: “So when interest rates rise, their debt payments will rise. If their incomes aren’t rising as well, then that’s a lethal mixture. They’re going to end up with all kinds of credit problems and perhaps in bankruptcy court.”
     Mason: “Fed Chairman Alan Greenspan was forced to slash rates to the lowest levels in more than 40 years to fight the effects of recession, terrorism and war. Now, the so-called king of America’s monetary policy is trying to make sure the economy doesn’t shift into overdrive.”
     Gramley: “And not to push on the monetary brakes but to back off the monetary gas pedal.”
     Mason concluded: “Either way, this era of low interest rates is beginning to appear in the rear view mirror. And economists say it could be decades before we encounter another one. Anthony Mason, CBS News, New York.”

ABC’s Gibson Paints Surprise Handover
as Sign of Failure

Still trying to paint the handover in Iraq as a sign of failure. ABC’s Charlie Gibson lectured Paul Bremer, the former U.S. Administrator in Iraq, about how “I can imagine that when you arrived in Iraq for the first time, you envisioned someday a ceremony with bands playing and crowds cheering, and control returned to the Iraqis,” but “instead it happened in secret, in a small room so as to disrupt potential terrorists.” Gibson asked on Wednesday’s Good Morning America: “Is that a sad commentary on where we stand with security?”

Bremer appeared from the White House lawn for his June 30 session with Gibson. The MRC’s Jessica Anderson took down Gibson’s questions:

-- "Mr. Ambassador, I don't mean to put thoughts in your head, but I can imagine that when you arrived in Iraq for the first time, you envisioned someday a ceremony with bands playing and crowds cheering, and control returned to the Iraqis. Instead it happened in secret, in a small room so as to disrupt potential terrorists. Is that a sad commentary on where we stand with security?”
Bremer rejected the premise: “I didn’t envision departing the day I arrived. We in fact never planned a large ceremony. We always planned what happened, which was a ceremony very modest and dignified. The only difference was we moved it from Wednesday to Monday.”

-- “Everything now depends on security -- that is the hope for the future. What evidence, other than hope, do you have that they will be able to do better?”
Bremer: The new Prime Minister is a “man of great toughness” and he has an “able cabinet” and the U.S. has stepped up training of Iraqi security forces.

-- “We have seen twice, though, in ten years their army cut and run. We are now taking young men and training them in security. Do you believe they can stand up to what they face?”
Bremer: “I think they can...a lot have stood and fought.”

Gibson went on to ask Bremer to list his “best moment or “greatest success” (Constitution agreement in March), “greatest regret,” (security) and then to comment on the state of mind of Saddam Hussein.

FNC Reveals How Moore Distorted Scene
with Bush at Golf Course

The TV ads for Michael Moore’s “documentary” Fahrenheit 9/11 feature a mocking clip of President Bush on a golf course. Bush declares, “I call upon all nations to do everything they can to stop these terrorists killers,” and then Moore jumps to Bush adding, as he prepares to swing at a golf ball, “now watch this drive.” Tuesday night on FNC’s Special Report with Brit Hume, Brian Wilson noted how “the viewer is left with the misleading impression Mr. Bush is talking about al-Qaeda terrorists.” But Wilson disclosed that “a check of the raw tape reveals the President is talking about an attack against Israel, carried out by a Palestinian suicide bomber.”

Indeed, Wilson played another part of what Bush said in the remarks to reporters made on August 4, 2002: “For the sake of the Israelis who are under attack, we must stop the terror.”

MRC analyst Megan McCormack noticed Wilson’s correction of Moore in a piece in which Wilson outlined how Moore’s movie better matches the definition of “propaganda” than “documentary.”

“The American Heritage Dictionary,” Wilson relayed, “defines a documentary film as one that presents facts quote, 'objectively without editorializing or inserting fictional matter.’”

     After documenting Moore’s distortion of Bush’s golf course comments, Wilson moved on to how “in his film, Moore claims that special flights carrying Saudi nationals were allowed to fly within the U.S. at a time when commercial aircraft were grounded due to the 9/11 attacks. Not true. The Saudi flights did not occur until after commercial flight restrictions were lifted on September 14th. Newsweek’s top investigative reporter Michael Isikoff took Moore to task on that and other incorrect claims in a recent column, and says of the movie:”
     Michael Isikoff: “It’s one window into some of the facts, but it’s certainly not a complete window into all the facts.”
     Wilson: “Even some news organizations providing clips to Moore for the film argue Fahrenheit 9/11 is not balanced. Bill Wheatley, a Vice President of NBC News, told the LA Times quote, '...the work of filmmakers is much more likely to be pointed in a particular direction...filmmakers tend to avoid balance and pursue a point of view.’ So if the word documentary really doesn’t fit Michael Moore’s film, how about this description? 'Ideas, facts, or allegations spread deliberately to further one’s cause or to damage an opposing cause.’ That’s how the dictionary defines the word propaganda. In Washington, Brian Wilson, Fox News.”

Last Friday night, June 25, the NBC Nightly News ran a fact check on Moore’s movie, the MRC’s Brad Wilmouth observed, and found it wanting. NBC’s Lisa Myers didn’t note how the golf course comments were suggested to be about al-Qaeda when they were really about Palestinian terrorists, but she did call it a “cheap shot.”

     She began her story with a clip of an ad for the movie: “A true story that will make your temperature rise."
     Myers asked: "But how true is it? The film's sometimes embarrassing video of Bush administration officials is authentic [clip of Ashcroft singing], though some argue certain shots amount to cheap shots."
     George W. Bush from movie, on golf course: "I call upon all nations to do everything they can to stop these terrorist killers. Thank you. Now, watch this drive."
     Myers: "The powerful story of Lyla Lipscomb, whose son was killed in Iraq, is also undeniable. But on other key points, critics say this so-called documentary is either wrong or deliberately misleading. The war in Iraq: To drive home the point that the children of the powerful aren't dying in Iraq, Moore ambushes politicians on Capitol Hill."
     Moore in movie: "Congressman, I'm Michael Moore. How are you doing?"
     Rep. Mark Kennedy (R-MN): "Good evening."
     Moore: "Good, good. I'm trying to get members of Congress to get their kids to enlist in the Army and go over to Iraq."
     Myers: "But Moore left out what Congressman Mark Kennedy went on to say."
     Kennedy, in interview with NBC: "My nephew had just gotten called up into service and was told he's heading to Afghanistan. He didn't like that answer, so he didn't include it."
     Myers: "Bush and the Saudis: The film traces ties between the Bush family and the bin Laden and Saudi royal families, then suggests the Bushes, quote, 'might be thinking about what's best for the Saudis instead of what's best for you.'"
     Roger Cressey, terrorism expert: "The Bush family's relationship with the bin Ladens and the Saudis had nothing to do with our decisions on the war on terrorism. To say so is simply unfair."
     Myers: "Finally, Saudi flights after 9/11: The film suggests that plane loads of Saudis, including the bin Laden family, were allowed to leave the U.S. after 9/11 without proper vetting. However, the 9/11 Commission says, 'Nobody was allowed to depart who the FBI wanted to interview.' One character in this film suggests that President Bush is even worse than Osama bin Laden, one of the excesses and distortions that may undermine the credibility of Michael Moore's message. Lisa Myers, NBC News, Washington."

But liberals and much of the media still love it.

Today Airs Katie Playing Badminton Over
New Saddam Hussein Video

The Today show’s parallel universe. Thursday morning at 8:30am EDT, ABC’s Good Morning America, CBS’s The Early Show, as well as MSNBC, CNN’s American Morning and FNC’s Fox & Friends, all aired the taped video just released out of Iraq showing Saddam Hussein in the courtroom, the first video of Hussein since the video of a scraggly Hussein in December just after he was found in a hole. But Today viewers instead saw Katie Couric playing badminton.

At 8:30am EDT, Today previewed an upcoming segment with two U.S. Olympic team badminton players by having Katie Couric whack the shuttlecock back and forth with them a few times over an outdoor net. Following the weather and an ad break, while every other network was showing Hussein, Today ran a taped interview by Jill Rappaport with Robert Redford. Following another ad break, Katie, Matt Lauer and Al Roker, all wearing sports outfits, took on the two Olympic team players in a game that lasted a few minutes -- and in which the real players let the Today team look good.

Today watchers didn’t get to see the new Hussein video until the 9am news update.

# Ralph Nader is scheduled to be the guest tonight, Thursday, on Comedy Central’s Daily Show with Jon Stewart.

-- Brent Baker

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