Actually, the United States mortgage market was working just fine until the Bush tax cuts. Suddenly, there was a flood of capital into financial markets, seeking safe haven, as the stock market was in free fall. T Bills were not the most attractive investment, since the Fed had dropped interest rates so low. What other investment had a better rate of return, and historically had been rock solid? Mortgage bonds. Suddenly, capital floods the mortgage market, and there is more demand for bonds than there is supply. Due to the repackaging of mortgages into securities, mortgage lenders were insulated from the consequences of making bad loans. There was suddenly a lot of money to be made (and therefore a lot of pressure to do so) by mortgage lenders ignoring their fiduciary duty and issuing loans they knew could not be paid back. This exacerbated the problem caused by derivatives trading, heralded by the failure of Long Term Capital Management in 1998. But nice try blaming it on the black people. Dick.
I think banks suck money out of the system through things like front-running the market. I think the stock market is largely a casino for the mega rich.
Yes, when a corporation makes a stock offering, they are raising money that will hopefully create jobs. Once that initial money is raised, however, the stock market's function as a job creating vehicle is greatly reduced. If a company's stock price goes up 10%, the value of their holding may be valued more, and they may be able to borrow more on margin, but this is negligible compared to the amount of money raised during an IPO. Moreover, that increase in value will ONLY create jobs through capital expenditure. Banks also make money loaning money to businesses, who then in turn use that money in potential job creation. However, businesses only make large capital investments like this when there is unmet demand that they see can be exploited. When there is unexploited demand in the marketplace, money comes out of the woodwork to capture that market segment. I promise you there is no business in the US that is lacking for investment funds to satisfy demonstrable unmet demand. In short, in our current economic climate, there is no unmet demand. No amount of capital investment can create demand; capital investment creates supply. This is why economists refer to your views as supply side economics, trickle down, or my preferred term, fucking voodoo. The solution to our economic woes are to increase demand. That means putting money in the hands of people who will spend it, not people who will invest it. For further information, I suggest picking up any high school level economics book. Supply and demand should be well covered.
The Republicans have a vested interest in the economy remaining poor. If the economy improves, Obama will be re-elected. This is almost a certainty, given his favorability numbers. Conversely, if the economy remains poor, Obama stands a good chance of losing.
The people who decide elections in this country are "swing" voters, or LIVs (low information voters). These voters tend to decide who they want to vote for based on their gut feeling, and then find reasons to justify this decision. This is why incumbent presidents almost always win in a good economy, and lose far more often in a bad one. Even if the Obama jobs proposal would completely turn the economy around, and give us all ponies, the Republicans won't let it pass. So, Obama has rolled out this package, knowing Republicans will vote against it, and then will campaign throughout this election cycle on their obstructionism. His only chance is to get those LIVs to think twice at the voting booth - to firmly implant in their minds that Republicans care more about millionaires than them. This jobs bill is not about jobs - it is about exposing Republicans for the obstructionists they (currently) are, in the most public way possible.
Or, to put it another way, we all pay payroll taxes. When I call you out on your lies, don't change the subject.