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Saving the Savings & Loans


( NOTE: 06/12/89 - Rcvd note of appreciation from Allan Ableman of BARRON'S. Only response ever.)
Ira Fine
Business Editor
ASBURY PARK PRESS
3601 Highway 66
Neptune, NJ 07754-1551

June 5,1989

Mr. Fine,

Enclosed please find a copy of a letter mailed April 12, 1989 to Senator Bradley regarding the S&L bailout problem. Copies of the letter were also sent to a number of area Congressmen at the same time.

While not offered as a panacea, I thought it a pretty good step in the right direction. Obviously from your column Senator Bradley doesn't think so. As a matter of fact, he didn't even deem it worth a reply, not even a form letter (you know the type - "I am always interested in your viewpoint and have taken the matter under study....etc."). No answer from any of the Congressmen's offices either. Is it possible that tax relief in any form is just so inherently abhorrent for any Democrat that he is struck dumb by even the mere suggestion? Did you ever get the feeling your electoral support was being taken for granted?

Enclosed also is a copy of the cover letter mailed to Congressman Pallone.

Thank you for your attention. Gösta H Lovgren
Congressman Pallone
808 Belmar Plaza
Belmar, NJ
May 23, 1989

Frank,

It was good to see you on Saturday at the commercial fisherman's picnic. You certainly seemed to be enjoying the food. I know they appreciated your coming.

Enclosed is a copy of the letter to Senator Bradley we spoke of. As you read it, don't get hung up on any specific numbers (i.e. $10,000, 50%, etc.). The important thing is the concept. Given the skittish sensitivity of the financial markets, even the mere announcement of such an amendment to the bailout bill will ease strains on the system. I recognize that as a freshman Congressman you have to tread softly, but perhaps this could help to establish your credibility. Even if eventually not politically viable, it shouldn't offend anyone in the meantime.

Other matters:

For what it's worth, as a constituent I am registering my disgust at the Speaker of the House - (Jim Wright) the emperor's wife and all that.

As a trader in the retail futures market I can without reservation assure you "front running" trades is prevalent and morally, if not legally, dishonest. It is certainly not the worst abuse in the stock market, but one that can be relatively easily brought under control.

Whenever you want advice on a fishery matter, feel free to call on me. You can be assured I will give as unbiased an evaluation as I can. I am no longer associated, other than friendship, with the industry and have no tangible interests. However I will say my knowledge and experience with both the industry and fishery management is as extensive as anyone's in or out of the government. At the very least you'll get a different perspective.

As ever, I wish you well.
Regards,
Gösta H. Lovgren
Senator Wm. Bradley
Senate Office Building
Washington, DC
April 12, 1989
Re: Savings and Loan crisis

Sir;

Given the current attention the Savings & Loan crisis is commanding in the Senate right now, I am moved to send along a suggestion that may be helpful.

It seems the most severe problem the viable thrifts are suffering right now is a hemorrhage of funds due to withdrawals by savers alarmed by all the recent negative publicity combined with a very low savings renewal rate. This is pushing otherwise healthy institutions into difficult straits and may well force many of them to become part of the so called bailout problem, compounding the eventual cost to the taxpayer.

I propose a RESTRICTED income tax exemption for interest earned in a Saving & Loan. The restrictions would be along the following lines: