Schiff Hosts Economic Roundtable In Pasadena

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PASADENA, CA — Economic issues have become the top concern among voters who plan to turn out for the November presidential election.

Some of those issues were hashed out Wednesday evening as more than 200 people gathered at the Pasadena Senior Center for an economic roundtable. The roundtable touched on everything from the nation’s ailing housing and banking sectors to the need for developing renewable energy sources.

Hosted by Rep. Adam Schiff, D-Pasadena, the event featured John Bovenzi, interim CEO for IndyMac Federal Bank, and a host of other experts in housing, the stock market and energy.

During a question-and-answer period, some members of the audience expressed concern about uninsured funds they lost when IndyMac Bancorp collapsed last month amid mounting defaults on its Alt-A mortgage loans and a sudden rash of depositor withdrawals.

On July 11, the bank was taken over by the Federal Deposit Insurance Corp. and converted to IndyMac Federal Bank FSB.

Bovenzi, who is also the FDIC’s chief operating officer, said his agency wants to sell the bank and return it to private ownership, which could help recoup some of the money depositors lost.

"We want to market the institution as a whole, but we’re also looking at it in pieces to see where we can get the most value," Bovenzi said.

Individual IndyMac depositors with $100,000 or less are covered by FDIC insurance and other individuals and couples can be covered for much more, depending on how their deposits are structured. IndyMac Federal Bank has pledged to pay depositors 50 percent of the uninsured funds they have lost.

On Wednesday, FDIC Chairwoman Sheila C. Bair announced that IndyMac is launching a new program to help borrowers with mortgages that are seriously delinquent or in default.

Judy Dugan, research director for Consumer Watchdog, lauded the federal agency’s takeover of IndyMac.

"It’s good that the government stepped in when it did," she said at Wednesday’s roundtable. "I think fewer banks will go under because of the way IndyMac was handled."

In regard to energy, Schiff noted that only 3 percent of the world’s oil supply comes from the United States, yet the U.S. accounts for 25 percent of the global demand for crude.

"Those numbers are badly out of skew," he said. "The one way forward for this country is to develop renewable energy."

Lawrence Harris, a professor of finance and economy at USC’s Marshall School of Business, said current economic conditions have many worried, although the Federal Reserve is keeping things in check.

"The Federal Reserve is paying close attention to the economy and is acting very forcefully to protect us all," Harris said. "The future is not particularly bright right now. But on the plus side, energy problems do lead to a lot of innovation – innovation with windmills and mechanical technology and agricultural technology."

Mitch Scaff, who attended the roundtable, said Congress should be taking a more holistic approach to the nation’s economic problems.

"I’m not particularly hopeful that our economic policy will be guided by a well-thought-out plan," the 44-year-old Altadena resident said. "It’s more of a Band-Aid approach, like, ‘Let’s patch this up over here.’ There are a lot of people in a lot of pain economically."

The event was moderated by Frank Mottek, a business reporter for KNX 1070 Newsradio.

Other speakers included Alberto G. Alvarado, director of the Los Angeles district office of the U.S. Small Business Administration; Raphael Bostic, a professor with the USC Lusk Center for Real Estate; Marc Jones, rehab construction manager for Pasadena Neighborhood Housing Services; and Martha Lucey, CEO and executive director of ByDesign Financial Solutions.
Contact the author at [email protected] or (626) 962-8811, Ext. 2701

Consumer Watchdog
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