So we are not only the military police of the world, but now the financial police of the world. The Washington politicos have gone completely delusional.
Whatever, we are going to default anyway. This is all just nonsense. Do you really believe that we will pay it back in real goods and services? Unlikely.
Unbelievable. The cost will be unimaginable. We are all collectively subsidizing the foolishness that was evident to anyone with a clue back as early as 2004-2005.
Okay I'll be overly self-involved and repost this from the last thread, since it's more apropos to this one. Looking in the RE section of my local paper, an awful lot of the foreclosures were financed by Deutsche Bank and HSBC. And my bank, Citizens, is now owned by RBS (Scotland). So if Paulson & henchmen are going to take toxic loans, how can they not avoid buying up those financed by 'foreign' banks? How does one define foreign?
Not treating those institutions the way US institutions are treated would be WAY worse than, say, the Dow falling to 8300 (which would, I believe, present a buying oppty). Given the absolute importance of foreign credit to our economy, that would truly freeze up the credit markets.
Re: Byz_Ruin's point about who is fronting the money - genius, isn't it!
Ah you poor rubes. The financial powers don't actually expect this proposal to pass. And they don't care if our Congress stops it, as it should.
They ask for sweeping and unconscionable fiscal power, since they already have the same level of monetary power in the Federal Reserve.
Fannie and Freddie already have the power to buy all the very same toxic waste. And the Fed already had the power to monetize it, even before the July law.
Be outraged as I am, and call your Congresspeople, as I did. But don't entertain any illusions that defeating this proposal will make a difference.
I think we should start learning Chinese and how to become very good tour guides to show our wonderful partly underwater ruined cities to our future overlords.
Is this new setup really designed to help out foreign companies, or is it designed to bail out companies (like AIG, for example) who are ostensibly American but have offshored their incorporation status in order to avoid paying taxes?
Comrade Midwest Product writes:
Is this new setup really designed to help out foreign companies, or is it designed to bail out companies (like AIG, for example) who are ostensibly American but have offshored their incorporation status in order to avoid paying taxes?
The odd thing about the bailout plan is that while it has taken the heat off of the insolvent banks, it's now causing much more attention to be paid to our insolvent government. Is that really a step forward for "confidence"?
I'm not normally a conspiracy theorist, but does anyone else suspect that the Chinese are using the thriftiness of their people and the proflificacy of Americans as part of a long range plan to establish themselves as the world's only superpower?
Here's what I don't understand. The reason why the Great Depression was a horrific event was that there was virtually no social safety net in place when it occurred. But there is a safety net now!
We have no clue if this plan will work, but one thing's clear - if it doesn't, we're all out of options and out probably over $1 trillion.
Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?
Although the stock market had a frenzied historical rally based on this whole scheme; it might represent the last opportunity to get out before realization sets in to the full ramifications of such knee-jerk policy.
Real estate will keep falling, but inflation in the rest of the economy could skyrocket. Interest rates might end up going through the roof.
I believe it also opens up the buyout to whole mortgages and even real estate-related loans, like the ridiculous condo construction loans that Corus made all over Miami Beach.
Can you believe taxpayer money would buy up the stupidest loans that banks have ever made, in never-to-be-completed buildings, at pennies on the dollar?
Despite all the dutch auction hoopla, you know damn well that if Corus threatens to go under, their loans will be rescued before others. The lack of transparency Paulson has built into this is designed to cover up the fact that it really will be lender-based (without requiring sacrifices from lenders), not asset-based.
"Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?"
is there a chance that this bailout legislation will be challenged in congress? everyone, especially the stock mkt, is assuming that the bailout becomes law on monday...this could be a problem...im an avid reader of history and i am now convinced that we are in the midst of the most significant event in the history of western civilization. There are too many people on the planet. close to 7 bln...nature doesnt like it, one bit..nature throws at us hurricanes, tsunamis, earthquakes, war, disease; this credit crisis not only now joins he list and is soon to take #1 spot. fiat currency destruction is nature's number one aim right now..it is now inevitable.
By including foreign banks, this means that the price paid by RTC II for toxic waste will almost certainly not be above market. Otherwise, they would be using taxpayer money to recapitalize foreign banks, which would be political suicide. Since the terms will be the same for domestic and foreign banks, the clear implication is that no recapitalization for domestic banks is contemplated through RTC II toxic waste purchases. Of course, this does not mean that some other means will not be used to recapitalize US banks. But it means that they have still not figured out an accepatable means to do this.
If the government received about 80% of AIG equity in exchange for an $85 billion loan, is Paulson suggesting taxpayers receive nothing from bailed out banks, whose stocks would rise, to the benefit of shareholders and debt investors, including those who created the mess, who stand to reap profits from taxpayer monies?
Should banks pay shareholder dividends with taxpayer dollars?
If hedge funds and foreign firms are not eligible to participate, what prevents them from selling or exchanging near worthless securities to eligible US banks to offload on to US taxpayers?
Is legislation stating Decisions by the Secretary are non-reviewable
and may not be reviewed by any court of law or any administrative agency,
constitutional?
Does bailing out the Banks & Wall Street revitalize the housing market, simulate consumer spending or increase Government Revenue?
If the S&L bailout cost taxpayers $125 billion
and the original estimates were somewhere between $30-50 billion
how much could a financial institution bailout cost
if initial estimates are $700 billion to 1.2 trillion?
From ABC News: Treasury Secretary Henry Paulson said this morning that the White House will push for foreign firms to be included in the $700 billion financial industry bailout.
"We are talking very aggressively with other countries around the
world," Paulson said in an interview on ABC News' "This Week." "If a financial institution has business operations in the United States, hires people in the United States... they have the same impact on the American people as any other institution."
Another thing worth remembering is that there are no real estate assets involved. This is a taking on of the Federal government the obligations for bundled securities that have been sliced, diced, tranched and shuffled. There is no clear recourse to the underlying real assets these 'securities' represent. It's just more paper, more fiat currency if you will, spun from whole cloth by the shadow banking system.
No way this goes through. When does the house start voting?
This bill will pass with at least 80% in favor. The best we can hope for is clamoring for (a) the removal of language giving Paulson godlike powers to never have his decisions reviewed by the courts, and (b) the addition of serious punitive measures against firms who sell us crap loans, especially against the management.
I don't see how inflation can dig in to this mess. It's obvious they keep trying to goose it but there isn't anything for it to latch onto. Wages are not going up and folks are cautious about spending and banks aren't lending. Money is not circulating no matter how much they keep injecting into the system.
Hopefully someone else sees inflation and can point out the signs.
I am now convinced we are simply heading into a period of supercharged hyperinflation. Concentrate all the debts on the US balance sheet and then inflate them away.
The Chicomms smile an inscrutable smile having done what Cousin Nikita could not. They have successfully hanged the decadent west with a rope we sold them.
CR writes: U.S. taxpayers may bailout foreign financial institutions and even foreign governments.
Truth be told the correct wording is; "U.S. taxpayers may bailout foreign financial institutions especially foreign governments."
I've just tried summarizing the bailout plan (or at least, my understanding of it, which might be something else entirely) in simple terms. Can somebody who knows what they're talking about give it a look through to see if I've got the gist of it? I don't think I've left anything important out, other than the free ponies.
It's my first ever blog post, so go easy-ish. Thanks!
Imagine the carping in the US if this was happening in Europe. As it is everyone in the US seems to be too stunned to be able to do anything. So many issues and questions raised by this. Essentially its Financial Martial Law, Treasury can do what the hell they like and they set the rules as they go along so as not to hinder 'progress'
I am writing today to ask that you vote NO for any BAILOUTS of the financial industry.
Wall Street and large banks made fortunes during the housing bubble boom years and shared little of that benefit with the American taxpayer. Why should the taxpayer shoulder the burden of bad decisions by both the lenders and the homeowners now that the bubble has popped? I understand the need to prop up certain failing institutions for the short-term, but a wholesale bailout of bad decisions will lead to more of the same a few years from now.
When bailouts are necessary, they should only come at a steep price to the shareholders, the debt holders, the management teams, and the homeowners who participated in this massive ponzi scheme. Risk takers (lenders and borrowers) who nearly annihilated our financial system should not be rewarded.
It is patently unfair for the taxpayer to pony up a blank check for up to a $1,000,000,000,000 without reforming the system and ensuring fairness and accountability are properly implemented. Any bailouts should only be attached to massive reform legislation that prevents bubbles of this magnitude from occurring again.
In addition, the debt loads for this proposal will make borrowing costs for everyone much higher. We either take the short-term pain of dealing with the crisis in the free-markets or pay for it later in higher taxes, higher interest rates, and higher commodity prices (think oil/gasoline) under the state capitalism proposal currently on the table by Bush and Congress.
I will be watching your votes carefully on this historic legislation. If you endorse this irresponsible bailout, I will do everything in my power to have everyone I know, come into acquaintance with, or otherwise contact - to vote for the presidential candidate in the OTHER PARTY.
The Chicomms smile an inscrutable smile having done what Cousin Nikita could not. They have successfully hanged the decadent west with a rope we sold them.
The attachment to the limb in question is also a hangman's noose, and the limb is their neck.
"We are now BAILING OUT everybody? The ENTIRE financial system of the world, bailed out with US funds we don't have?! This is MAD! DELUSIONAL!"
Who do you mean by "we?" The "financial system of the world" is planing its bailout through its acolytes in the Bush Administration and elsewher in Washington. It's saving itself. The citizens of the U.S. are just the chumps who make it possible.
What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling.
It's a much more likely outcome than appeals to patriotism, logic, or fiscal prudence.
Paulson hopes to restore confidence in the US financial system, and bring back the foreign investment that comes with that.
What he's likely to find is that the rest of the world is more the willing to exchange their mortgage junk for T-bills, but unwilling to put new money in to restart what is now certainly viewed as a mortgage ponzi scheme. After all, they've been played for the fool on that one.
The worlds investors will need to see the US housing fall to its true floor. A floor not supported by government bailouts or pricing supports. Then, after years have passsed, foreign investment may even return to support real estate.
What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling.
Yeah - there's that, too. There was talk of an extra $100 billion stimulus package. Chris Dodd was even talking about tacking on credit card debt relief.
This will pass with more Dems voting for it than republicans--that way they campaign against themselves and make dems look like bushies. Dumb and dummer. naive vs. evil. wmd redux.
Executive Order 9066: Franklin D. Roosevelt delegated military authority to remove all people (used to target specifically Japanese Americans and German Americans) in a military zone. The authority delegated to General John L. DeWitt subsequently paved the way for all Japanese-Americans on the West Coast to be sent to internment camps for the duration of World War II. Thousands of German Americans and Italian Americans were also sent to internment camps under executive order.
Should anyone care, the "inscrutable" comment is mine.
Anyway the core of the problem is that the US is too rich relative to other nations and needs to be made poorer now that our ability to raise living standards around the globe is slowing. Sounds simplistic but everything for the last near 40 years has been about establishing social justice/equity. The global warming hoax, NAFTA, free trade, outsourcing, intellectual property theft, on and on all serve the end goal. Now we have a "financial crisis" of global proportions and who gets the bill?
This will pass with more Dems voting for it than republicans
The Dems may try to hold out because they are trying to attach more provisions for funding their constituents...Another reason this
may be issued in Executive Order form, IMO.
What's so hard about stipulating that any institution that uses this bailout must limit the total compensation, by any means, of any individual employee to no more than the salary of the President of the United States? This compensation limit would be applicable for 2008 through 2010.
This is not going to improve the housing (inventory) situation at all. The best this could do from a social standpoint is relieve people currently at risk of foreclosure. And those people won't be buying houses. This is just to bail out Wall Street (and apparently financial institutions worldwide), in hopes they do not pull the debt out from under our feet. So we can still have business loans, car loans, student loans, credit cards, etc. I think it shows how much of our "growth" is financed through debt. As for housing inventories, we'll pass that buck to the next administration.
There is no way in hell the Dems are not going to rubber stamp this beast. Do you really think they are going to delay it with potential poison pills after they said it was the end of the world if it didn't pass? And risk and adverse market reaction solely attributable to them on Monday? No way. They are only sensing they have a modicum of leverage here (no pun intended) because it is likely there are a few free market Republicans will oppose it, and that will make the Dems' position more important. Has anyone seen a democratic legislator come out and say they are flat-out against it? I am curious if you have, but I think this thing is as good as done.
Another thing - how much of the banks' earnings were based on their ability to generate these instruments? Most of it. Even if we buy this crap off them, they still might not have a sustainable business model. And then we really will be out our trillions in corporate welfare.
By, can I call you By? We're all friends here. Yes, we certainly shall see. Where's that guy with the popcorn? Hey, wait! Let's get loaded and gape in slack jawed wonder. We'll need that cannabis guy for that.
This is insane. Pushing all of the risk from the HB&B both domestic and foreign onto the government balance sheet is an outright act of treason, as it puts the entire country at risk of default.
Bond Girl - it stabilizes the markets for a few days so that Titans of Finance can move their money elsewhere. But you're right - this does nothing to help the problem of overpriced inventory.
And what about the argument that any institution that receives federal assistance should be subject to federal regulations that so many of our esteemed leaders have been touting lately? We can give foreign banks help, but we can't really regulate their core operations can we? We can control what they do over here, but not with an eye to keeping the entire buisiness stable. What dopes.
This is not a sub-prime crisis, nor a mortgage or housing crises. This is a debt crisis brought on by a fractional reserve banking system using fiat currency. A "floor in the housing market" will not solve the problem.
Another thing - how much of the banks' earnings were based on their ability to generate these instruments? Most of it. Even if we buy this crap off them, they still might not have a sustainable business model. And then we really will be out our trillions in corporate welfare.
The Mother of all Golden Parachutes. Golden Parachute for them, golden something else for the Taxpayers.
Yes, we certainly shall see. Where's that guy with the popcorn? Hey, wait! Let's get loaded and gape in slack jawed wonder. We'll need that cannabis guy for that.
I prefer Byz.
To be more articulate than glib, I think the mandarins are rallying to set up their awful racket and the sure thing may prove less sure than its masters believe.
The Harriet Meir(sp?) nomination comes to mind. I'm pretty sure this was supposed to be a same-day deal, that could be announced in time for Asian market open. It is seeming it is pretty clear it will not be that. I am very curious about the next 36 hours.
Alas, I have to go into my ByzDome and winnow the PEO PCOs from the non-PEO PCOs and will be away from all the fun. Luckily my cronies SMS me throughout the day with updates.
Oh, now Paulson is preaching the world to prepapre for massive bailouts and it's no more than a few decades since U.S. was preaching the world to let free markets clear themselves and not have governments intervening. What a clown and I'm sure everyone in the world has convenience on U.S., Fed Bernanke and Paulson that they are on top of things. How's that bottom in housing you've been calling many times coming alone, Mr. Paulson??
What? You thought you could keep on making the rest of the world work for peanuts while they financed your spending and stick them foreigners with defaults when all hell broke loose.
Wake up and smell the coffee! Default on your foregin debt and expect war. Americans are stuck between a rock and a hard place.
This administration has not been able to clean up New Orleans after 3 years of promises and who knows how many billions of dollars. Who in their right mind would give them $700b with no strings attached and trust them?
I would trust Putin over Paulson.At least he knows how communism is supposed to work.
Commissar 4822 writes:
This will pass with more Dems voting for it than republicans
Don't kid yourself - GOP is behind this 100% - they have the luxury of being in the minority so can throw hand grenades... if they were in the majority Hank & Ben & Shrub would be sitting on them BIG TIME.
GOP in House & Senate are irrelevant from a power perspective so why not flip everyone off?
Dems did the same thing for years when they were in The Wilderness..
If GOP really wanted to kibosh the thing - force cloture vote and deny the 60 votes... drag it out and talk it to death... longer this vampire stays awake the more likely the sun kills it.
If it passes quickly w/out cloture battle - even w/ votes against - its essentially 'unanimous'.
A lot of the voting in congress is for show & posturing... read between the lines.
For the next president, this will be akin to Van Buren and his one term. Didn't markets of that era seize up just as he was inaugurated to usher in the worst Depression up to that time in the nation's history? That Only difference now is that there are about 320 mln more people inhabiting our nation. It's not so much the numbers that are scary, but the coming social collapse that we should all be fearful of, especially the "haves" of the world.
This "Comrade" meme has got to go - no socialism here.
I don't find it such a bad thing. ;^)
It could be what American Voters and Taxpayers will soon need to call each other in this era of financial rule and ruin of the illustrious 'captains' of finance.
Read Fact Sheet. Not even limited to mortgage-related assets anymore: "Treasury will have authority to issue up to $700 billion of Treasury securities to finance the purchase of troubled assets. The purchases are intended to be residential and commercial mortgage-related assets, which may include mortgage-backed securities and whole loans. The Secretary will have the discretion, in consultation with the Chairman of the Federal Reserve, to purchase other assets, as deemed necessary to effectively stabilize financial markets."
If the Dems do not stop this bill they do not deserve to be in power. They are nothing more than a club that hands out the spoils of power to their members.
Let me see if I got this straight (please correct me if I'm wrong):
First point.
1. If only US based companies are bailed out, GS would buy toxic UBS crap and sell it to TARP for a fee.
2. If the company must have a big presence in US in order to be bailed out, the foreign company will transfer the crap to an US branch and sell it to TARP.
3. If we bail everybody, all the crap will be sold to TARP.
Thus, regardless of the policy TARP ends up buying all the crap. Some time ago the wise men said that using derivatives you spread the risk around the world. Well, not only that we spread it to the point where systemic risk took over, but now we bring all the risk/crap back and cover it with a TARP. Isn't this karma?
A second point: the program will buy crap, repackage it, sell the good stuff and keep the bad, then repeat the process. In the end it will have only bad stuff left and no money to buy more crap from banks. So $700bn is gone, and very likely it will not be enough - thus, the next congress will double the amount.
Third point: how far can we extend the TARP? I guess it is related to the percentage between buying price (from the banks) and selling price (after repackaging). Say that in the first step TARP pays $100 to buy crap, repackages it and sells the good part for $90 and keeps the bad part. Now, it has $90 to buy new crap from banks, etc. so the total crap bought through this process is going to be $1000. What do you think: are TARP managers are good enough to get 90% of the value back (either by buying low or selling high)? In that case, is $700bn x 10 = $7 trillion enough to buy all the crap there is out there?
*
"The Tragedy of the Commons is the title of an influential article written by Garrett Hardin, first published in the journal Science in 1968.[1] The article describes a dilemma in which multiple individuals acting independently in their own self-interest can ultimately destroy a shared resource even where it is clear that it is not in anyone's long term interest for this to happen."
"Central to Hardin's article is a metaphor of herders sharing a common parcel of land (the commons) on which they are all entitled to let their cows graze. In Hardin's view it is in each herders interest to put as many cows as possible onto the land even if the commons is damaged as a result. The herder receives all the benefits from the additional cows but the damage to the commons is shared by the entire group. If all herders make this individually rational decision, however, the commons is destroyed and all herders suffer."
"Paradoxically, Hardin's article has been interpreted as an argument both for the privatization of community assets and for increased government regulation." (Wikipedia)
IMO, the payments system will be toast long before Friday without another game of kick the can. Even a "global bailout" can-kicking might not take it that far. mp / Conjure bag seem to think it's already table-ready, I think it will stagger along til at least Wednesday. Maybe we are hopeless pessimists.
This is the end -- of something. Could be the financial system. Could be democracy. Could well be the middle class. Could be the U.S. as we know it (not the same as democracy, hah).
It's in the waning days of a regime that titanic and hopeless and irresponsibleschemes are mounted to regain past power and glory. Not like I've been around for 2,000 years, but I've read a book or two, as have most of you. All this is... amazingly familiar.
Sec. 8. Review. Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
If the Democrats had any hair, they would blame this disaster on the Wall Street rich guys and vote no. For all the wrong reasons, they would win and stave off this legislative disaster in the making. Paulson is selling the american taxpayer in to slavery to keep this rotting corpse of an economy on life support for another week or two. This is an outrage!
I'm sure this has shown up on one of these threads, but I'll repeat the renamed bill I found on Bigpicture, as it is entirely apropos and perhaps useful in explaining this mess to the sheeple: The No Banker Left Behind Act.
If they just let the banks fail, the Government could pick up the real estate for nothing, just as it did in the S&L collapse. That would cost the taxpayer much less money.
The one question I have is hyperinflation in the
cards or are the deflationists right ? I can see both
scenarios playing out but this bailout really tips me towards hyperinflation.
We are being told that without this investment bank bailout plan, that Main Street economy will collapse. However, we were once told that If we did not stop Saddam, he would destroy us with nuclear weapons. I'll never forget the mushroom cloud pictures during Bush's speech. I believe they will allow nothing to get in the way of their market takover plans. The last thing Paulson and the administration want is any serious examination. The American people will never know what hit them, and few will understand why this creation and conversion of tax payer debt into corporate banking wealth is being executed.
If the banks were to receive $.60 on the dollar for their mortgage backed securities, it would be a total gift. Remember, Merrill Lynch "sold" its mortgage backed securities for $.22 on the dollar. ML also carried the paper. In other words, they gave the appearence that they got financial asbestos off their balance sheet, but in actuality, they were unable to sell it. ML had $30.6 billion of CDOs that were already marked down to $11.1 billion. Yet, they "sold" this garbage to Lone Star for 6.7 billion. That left Merrill Lynch taking another $4.4 billion write-down and 'selling' those securities at 22% of the original face value. If it were a real sale, it probably would have gone for $.05 on the dollar, or, possibly, couldn't have been sold at all.
The National Australia Bank (NAB) took a 90% writedown on its 550 million (AUD) in holdings of US mortgage debt. What it did was to admit that it's AAA-rated securities were virtually worthless. So what are these mortgages that the Treasury wants to buy with first $700 billion chunk of US taxpayer money worth? They are worth nothing. This is a gift from the former CEO of Goldman Sachs to his cronies. The first $700 billion increment of mortgages bought by the taxpayers will constitute a direct payment to the very banks that destroyed the American economic system. These mortgage backed securities will be collateralized by the absolute worst toxic waste the banks have been stuck with. Once in posession of this money, the banking elites can continue to pay themselves huge bonuses, while continuing the leveraged looting that became legal the day Bill Clinton Signed Phil Gramm's bill (Gramm-Leach-Bliley Act), a bill that vitiated the Glass-Steagall Act.
Nobody writes:
Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?
Sent to the Houston Chronicle as a letter/op ed - who knows they may even print it:
Once again over the weekend, the duly elected representative government of the American people are being stampeded towards an abysmal policy in the guise of securing the financial system from an apocalyptic meltdown. A policy that is to be funded by the taxpaying public without oversight or recourse, to be administered by unelected bureaucrats who will appoint companies from the financial industry to implement the program.
All we need to do is write the biggest blank check in American history, have the Congress abrogate every constitutional responsibility of fiduciary oversight, and appoint the Secretary of the Treasury the 'finanziellfuhrer' and trust Washington to get it right. You know, the problem they told us was 'contained' to sub-prime mortgages.
The problems with this proposal are myriad, and we arrived at this situation over a generation of excessive credit use. Rather than get into the intricacies of securitization, dollar recycling by China and the Middle East to finance our twin deficits, strains in interbank lending implicit in the TED spread or skyrocketing commercial paper rates, let me share a metaphor with my fellow citizens.
Wall Street financial institutions have been having one heck of a party, with $1,000 bottles of wine and scotch flowing like water, $100 cigars being enjoyed by 'the masters of the universe' and only the finest caviar served to be savored by this select crew. Now the check is being prepared and the black tie crowd is slipping out the side door to leave it for the waitstaff, the US taxpayer.
This will be sold as averting the economic apocalypse, as costing less than the alternative and can even make money for the taxpayers - just put all your trust in the 'finanziellfuhrer' as he makes every bank in the US and around the world whole on your dime - it's for your own good!
The sad truth is that bitter economic medicine is coming, all this is about is who will pay the tab: the people who made the mess or the US taxpayer. Call your Senators and member of the Congress and tell them "Stop the madness!"
In 1980, Jimmy Carter asked Castro to allow Cubans, who wanted to leave Cuba, to leave and come to America. Castro did exactly what Carter wanted, and not only allowed, but sent 125,000 Cubans from Mariel Harbor to the US. This was called the Mariel Boatlift.
Who were these Cubans that "escaped" to America? Most were the dregs of Cuban society, because Castro emptied the jails and mental institutions and shipped them to the US, where Carter was waiting with open arms. A major crimewave in Florida was born.
Paulson is engineering his own Mariel Boatlift of sorts. When the major banks receive their shares of the first $700 billion, they will open the floodgates and saturate the American taxpayer with mortgage backed securities collateralized by the most undesirable real estate possible. There will be boarded up houses from Cleveland, Detroit, Gary Indiana, Johnstown, Ohio, and vacant tract homes from places like the Inland Empire desert to Weld County, Co. Then Paulson will ask the American taxpayer for billions more to manage these unsaleable "assets". So, not only will the banks get hundreds of billions of dollars, but they will be relieved of the financial and moral liabilities of having to manage these piles of so sticks, bricks and vinyl siding.
Paulson is TRYING to load this up with poison pills, so it will get rejected and the blame can be put on the democrats. And/or let the democrats load this up to the gills with additional costly provisions.
GS stands to GAIN if the other banks go under. Paulson doesn't want this proposal to pass anymore the we do.
My guess is he thought the $700B number would scare them off...but the called his bluff, so he needs to up the ante.
For those angry enough to act: contacting your member of congress is good -- contacting your state/local officials can be useful as well -(see search box in upper left to find all of your elected officials):
If you call their offices, all these officials have staff dedicated to taking complaints/solving problems -- if they get inundated with calls, they are going to do somethig -even if it is simply informing your officials that the public is outraged.
one of the BEST things you can do is contact your local media - TV station /radio/ and newspaper - and register complaints, and ask why they aren't knocking at elected officials' door and covering this more. They get enough complaints, it's a story.
Get a few folks together in your neighborhood, church group, whatever - even if it's just your family, and organize a protest, or pass out flyers in front of a bank (yes it's small potatoes, but press are much more likely to cover if there's some kind of visual/audio element they can whip up for their newspaper-website pages or the TV news.) The more visual, the better (can you rent pig costumes - or at least buy those pig noses at a Halloween store?).
Some national media numbers (I recommend phone calls at this point -ask for the newsroom / news assignment desk to try to get through)
what about this sentence "To qualify for the program, assets must have been originated or issued on or before September 17, 2008" How does this help banks when most of the toxic paper has already been issued before that date?
black swan wrote: "That left Merrill Lynch taking another $4.4 billion write-down and 'selling' those securities at 22% of the original face value. If it were a real sale, it probably would have gone for $.05 on the dollar, or, possibly, couldn't have been sold at all."
Review the facts and you'll rediscover that this is indeed what happened--five cents on the dollar. ML carried back the rest.
Rob Dawg writes:
Bond Girl writes:
Does anyone really expect that war will come from defaulting on our debt?
Raises hand. One word answer: Taiwan.
Don't buy it? Ask Georgia.
Rob Dawg | Homepage | 09.21.08 - 11:45 am | #
There is a saying in geo-politics... "Geography is more important than policy."
Look where Georgia & Taiwan are... they could have been taken any time they wanted (they being Russia & China). About as big a deal as us taking Chihuahua or Cuba - is it worth it? Is it necessary? What does it do for us?
I don't see our financial problems speeding up or slowing down this process when & if it ever happens.
If Taiwan becomes a PITA to China like Georgia was to Russia - China grabs or neutralizes it. Georgia is a non-problem for the Russians now... better than if they took it over. China can do the same thing almost anytime it wants - we will NOT go to nuclear war over it regardless of McPalin mouthing off.
There are a lot of ways to skin a cat. Chinese know this better than anyone.
Sec. 8. Review. Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
I'm not sure but I think " committed to agency discretion" means secret.
And after you send letters to your paper, call its newsroom assignment desk and ask for more stories / investigative pieces and polls of Americans to determine whether the taxpayers support this.
Well screw everybody....I'm off to my undiscovered island where I pay taxes to myself, sell food to myself and watch the sun go overhead.
grumpyoldvet | 09.21.08 - 11:00 am | #
if you founded such a place, i guarantee there are like-minded comrades to join you.
Interesting. At the end of the Clinton Administration there was this big concern about the budget surplus and a plan to slowly pay off the national debt (with calmer people suggesting maybe paying off the national debt wasn't such a good idea). At the end of the Bush Administration, we have, well this . . .
And yet the Republicans have successfully marketed themselves as the party of fiscal responsibility, prudent and conservative stewardship of the free market economy, etc.
I think the Reagan legacy is kaput. And I think the Republicans are going to need to rebrand themselves.
The Paulson proposal boils down to, trust me, I know what I'm doing. I'm not sure if that's a good idea, or not, and if not, what the alternatives are. Something tells me that the answer to that question depends on whether you take a short term or long term perspective.
As any first year law student can tell you, section 8, purporting to preclude judicial review, is complete bullshit.
This is a diversion, a red herring. They are pulling our strings so we'll focus on this ostensible blatant power grab.
They'll "negotiate", Democrats will bluster, it will get dropped in committee, and the Democrats will crow how they clipped Hank's wings and preserved judicial review.
And everyone will breathe a sigh of relief.
Even though his actions would have been judicially reviewable no matter what the statute says.
The really nefarious thing is the blank check for Hank. There are no limits on his exercise of discretion. THAT is the problem. Section 8 is not the problem. The courts can review, but there's nothing to review if there are no meaningful limits on his actions.
I worked as legislative staff for a state representative in Alaska many moons ago, we use to say that how someone said they were going to f@ck you in government was "Trust me."
"Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."
Translation: Bush not longer needs Congressional authorization to appropriate funds.
The first suggests the alternative rescue plan of having the govt buy stakes in companies as the way to recapitalize firms, and then have a share of future upside potential, and also, implicitly, a quid pro quo for transparency and regulation.
The second post is shorter and, I think, more important. There Krugman implicitly compares the handling of the current crisis to the handling of 9/11 and the Iraq war vote. This is more important because demanding checks, balances, judicial review, accountability, and transparency in the rescue plan allows the country to make changes in the future - in contrast, the Bush Admn used terror to demand total authority and secrecy, which could then be used to push back on any argument for change. That cannot be allowed again.
If you haven't contacted your Senators' offices and Representative's office to tell them where Paulson should shove his plan, then consider yourself complicit in it.
This doesn't matter how bad this plan is. The Neo-cons know that any opposition from the Dems. will be political sepuku so they come up with the most BS outlandish piece of crap imaginable. Knowing that it will pass and they (dems.) will be dealing with it for the next four years.
Brilliant strategy however we will all be paying for it no matter what your affiliations.
If it passes verbatim by monday. Maybe it really IS time to divest out of Any dollar denominated assets.
What, if it passes it may buy time or if it passes it may recommend to you divestiture?
I have been recommending moving some or all of their investments out of the dollar to anyone who'd listen since Greenspan started the Festival of the Damned after 9/11.
"Paulsen and congressional Republicans, or the few that will actually vote for this (most will be unwilling to take responsibility for the consequences of their policies), have said that there can't be any "add ons," or addition provisions. Fuck that. I don't really want to trigger a world wide depression (that's not hyperbole, that's a distinct possibility), but I'm not voting for a blank check for $700 billion for those mother fuckers.
Nancy said she wanted to include the second "stimulus" package that the Bush Administration and congressional Republicans have blocked. I don't want to trade a $700 billion dollar giveaway to the most unsympathetic human beings on the planet for a few fucking bridges. I want reforms of the industry, and I want it to be as punitive as possible.
Henry Waxman has suggested corporate government reforms, including CEO compensation, as the price for this. Some members have publicly suggested allowing modification of mortgages in bankruptcy, and the House Judiciary Committee staff is also very interested in that. That's a real possibility.
We may strip out all the gives to industry in the predatory mortgage lending bill that the House passed last November, which hasn't budged in the Senate, and include that in the bill. There are other ideas on the table but they are going to be tough to work out before next week.
I also find myself drawn to provisions that would serve no useful purpose except to insult the industry, like requiring the CEOs, CFOs and the chair of the board of any entity that sells mortgage related securities to the Treasury Department to certify that they have completed an approved course in credit counseling. That is now required of consumers filing bankruptcy to make sure they feel properly humiliated for being head over heels in debt, although most lost control of their finances because of a serious illness in the family. That would just be petty and childish, and completely in character for me.
I'm open to other ideas, and I am looking for volunteers who want to hold the sons of bitches so I can beat the crap out of them."
Also would help if it's OK by energyecon if others can use the letter to send to elected officials - or if some of you can create good sample letters we can send and label them as such
(remember to send to state/local too -- they'll be stuck with bills when our tax money dries up and we need to foment outrage at that level)
And call, call, call - they can ignore an email or letter but it's harder to ignore a call
"What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling."
Another thing that may save us is that folks on the right are just as incensed as folks on the left. For different reasons. The conservatives see this as their big government worst nightmare and the liberals see this as their big business worst nightmare. Maybe they'll work together for once to save the country from this madness.
One question... why would they do this on the eve of the election, if they think they have a big chance of losing.
Either -
a) they are confident they will win
b) they think they can do a great deal of the bailout between now and January 22nd
c) they know the next Treasury secretary will have his hands tied to the bailout regardless
d) any favoritism under a democratic administration under this program will turn out to be the mother of all scandals and lead to republicans taking back control in 2012
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
and they will when the cost is the least. They won't even have to invade, just land an official jet and pronounce the fait accompli.
Volker the Viking | 09.21.08 - 11:59 am | #
You forget the other half of the equation - COST vs BENEFIT?
Why do it? Only when & if the Taiwanese make it an unavoidable issue - they haven't pushed it so no need. Their most recent gov'ts have gotten closer to the mainland & less confrontational. It will be an Anschluss between their gov't & PRC (people of Taiwan will have no real say)... it will only be war if the Taiwanese push it.
If the Taiwanese pull a 'Georgia'... vote in a proto-neocon puppet... only then will the PRC be forced to 'neutralize the threat'... lotta ways to do that too W/OUT firing a shot.
Do you realize how much investment there has been in the mainland from Taiwan? Threaten to nationalize it all & turn over to SOEs if the Taiwanese doesn't behave... it would blow a hole in their economy & tumble any militant confrontational gov't Taiwan votes in.
BTW - same thing will happen in Georgia - give it time. Lesson will be... if you want poverty and troops on your border then piss us off. Want to prosper and remain 'independent' then suck up to us... they'll get it.
Here's one problem. While we're dissecting each element of every event taking place in the various bailouts, the average person is aware that there is some "sub-prime crisis" that is going on in other parts of the country and is more interested with the point spread of this weekend's game. Not one person in 100 knows or cares. Read it and weep: Google Fight : Make a fight with googleFight index...=britney+spears
Now, Congressmen are trying to get another stimulus package out the door before the elections.
I feel like the turkey, the day before Thanksgiving. "Well, today looks a lot like yesterday, so everything must be fine. And tomorrow will be just like today. What's for dinner?"
"Debtpocalypse writes:
If you haven't contacted your Senators' offices and Representative's office to tell them where Paulson should shove his plan, then consider yourself complicit in it."
I called yesterday, hope they listen.
I plan to call again to different offices.
If so inclined, also relate the possibility that this might be lauched as an Executive Order, sidestepping the Legislative Branch.
Foreign banks of course means the foreign banks in the list of 17 banks he produced earlier this year:
BNP Paribas Securities Corp.
Bank of America Corporation
Barclays PLC
Citigroup Inc.
Credit Suisse Group
Daiwa Securities Group Inc.
Deutsche Bank Group AG
Allianz SE
Goldman, Sachs Group Inc
Royal Bank ADS RBS
HSBC Holdings PLC ADS
J. P. Morgan Chase & Co.
Lehman Brothers Holdings Inc.
Merrill Lynch & Co., Inc.
Mizuho Financial Group, Inc.
Morgan Stanley
UBS AG
Freddie Mac
Fannie Mae
Someone is taking over all the world's largest banks or putting them out of business. I wonder why?
"The result, pretty soon into the process, will be social breakdown and political upheaval. Every tatoo freak out there who has been prepping for his own starring role in some kind of comic book armageddon will finally get his chance to shine. Lots of people will get hurt and starve. Property will change hands in a disorderly way. And at the end of this process an American corn-pone Hitler may be waiting to set everything and everyone straight.
The markets open in about an hour. Good luck everyone."
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
Serf Nerdsky | 09.21.08 - 12:10 pm | #
We've only been begging for decent levees down here for 50 years. Maybe we should have renamed the city to the Bank of New Orleans so the gov't would take us seriously when we say we're "underwater"...
Perhaps this point has been made elsewhere, but keeping foreign investors placated seems to me what is driving this. Either we promise to buy this crap back from them or they put us under. It's that simple. So this little clarification surprises me not at all. And who can blame them -- this was allowed to happen. Tanta was the most eloquent Cassandra, but not the only one. Those in charge knew what she knew.
They've been very naughty.
I'm thinking to spread some holiday cheer
they get a visit from (Futurama's) Robot Santa this year.
For Immediate Release
Office of the Press Secretary
September 11, 2008
Executive Order: Executive Branch Responsibilities with Respect to Orders of Succession
By the authority vested in me as President by the Constitution and the laws of the United States of America, it is hereby ordered as follows:
Section 1. Policy. It is the policy of the Federal Government to ensure that each executive branch agency can perform its essential functions and remain an effectively functioning part of the Federal Government under all conditions. Accordingly, each agency shall take all appropriate actions to establish, maintain, and, as necessary, revise an order of succession, or to propose presidential action to establish or revise an order of succession...
Serf Nerdsky writes:
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
This appears to be a new transitista meme. The California High Speed Rail advocates are making similar claims. It isn't the capital costs, it is the ongoing massive subsidies to keep them running. If these new transit systems were to resemble the best of the current crop fares would have to quadruple to cover the current operating deficits.
I always thought that if we were going to invade Iraq the inevitable course would be World War, it set a very bad example. Our first reaction to any crisis or any amount of fear or uncertainty would be the exportation of our violence.
EVERYBODY is finance saw this coming, don't kid yourself. The CEOs saw it coming but thought they could time it. I used to work at a specific investment bank that is no longer independent, and its chief economist was publishing article after article at the time trying to prove his point that there was a real estate bubble - in late 2004 and 2005. And everyone said no bubble, just froth. And he was insistent. That year that particular bank was the largest global underwriter of mortgage backed securities.
Step 1. Congress needs to demand the immediate resignation of Bush/Cheney/Paulson/Bernanke for malfeasance on the grandest of scales.
Step 2. Require that all level 3 assets be marked to reality and published immediately.
Step 3. Nationalize all insolvent companies that are deemed to big to fail.
Step 4. Begin criminal investigations of the senior staff of every nationalized company.
Step 5. Regulate all financial institutions with enough rules to prevent this from happening until we forget what happened.
Short the dollar
short Treasuries
long commodities
join underground economy
cut up credit cards
pull money from bank and buy toilet paper
only keep necessary checking account to pay bills with minimum funding
Fuck'em
I'm just making an example, the local Minnesota Republicans go absolutely ape-shit about spending $500 million dollars on a light rail line, but don't think twice about spending $1 trillion for reasons that aren't particularly clear.
Now. come on folks, won't the Chinese be paying for all of this, really? Ultimately? Where does all our cash come from anyway? We're just the middle man.
does the american public really comprehend how much money was made on Wall Street over the course of the last 5-7 years off of these marked to fantasy financial products? J6P gets upset when they hear about the excesses of Enron, or a fired CEO getting a 42 million dollar golden parachute, but I dont think people really understand how much money was made by not just the CEOs, but the majority of people working on Wall Street over the past several years. Until people start seeing some figures on average salary in the firms we are about to bail out, this thing may get railroaded through.
We can only hope there's some shred of intelligence left in Congress to not pass this massive disaster, and that Bush tries to run the end-around with an executive order. At least that way, the Supreme Court could strike it down like the unconstitutional farce it would be, hopefully before every penny of ten future generations is gone.
Does anyone really expect that war will come from defaulting on our debt?
The Great Depression basically helped put Hitler in place and probably devolved into WW2.
Force hardship on other countries and expect retaliation of some form... I'm sure those Sovereign funds won't be cheering if they don't get their money back.
Nick writes:
We can only hope there's some shred of intelligence left in Congress to not pass this massive disaster, and that Bush tries to run the end-around with an executive order. At least that way, the Supreme Court could strike it down like the unconstitutional farce it would be, hopefully before every penny of ten future generations is gone.
Nick | Homepage | 09.21.08 - 12:23 pm | #
When this Supreme Court is your best hope. you are in terrible shape.
Well, "bailing out foreign banks" is not going to be a big selling point politically, I suspect--even though the distinction between a "foreign bank" and a big Wall Street-based financial institution is hard to make in practical terms. Our banks invest over there; theirs invest over here, etc. It's like trying to buy an American-made car.
The more I think about it, this whole plan seems to be the ultimate exercise in trickle-down economics. We pour billions into institutions controlled by the rich and powerful -- the top of the pyramid-- and I am supposed to believe that at the end of the day, the company I work for will be able to issue commercial paper and meet payroll, my bank will extend my HELOC and my credit card company will raise my limit. Whoopee.
Those of you who are writing Congressmen might want to just ask them one single question: "How much is this plan going to raise my taxes?"
Has anyone given the taxpayer an estimate of that? Let's hear it. Let us know what we are going to be asked to pay, and then we'll decide if we're willing to take these risks that Paulsen talks about.
This issue about bailing out foreign investors is a good segway into what the larger issue is . . . You should all read a special report the economist did in 2005 on world-wide real estate prices ( There is a copy of the report at The page cannot be found
The issue of overvalued real estate assets is a world wide phenomenon. And, anyone who has a clue as to how I-Banks work knows that they were marketing their garbage all over the world using world-wide assets. This is a huge, huge issue. The problem is global. The reason Paulson wants to refund foreign banks is he prays there can be coordinated efforts around the world as asset prices fall. This coordinated effort is a necessary (but not sufficient) condition to getting out of this mess. The probability of pulling this off is, in my opinion, just about zero percent.
I am a lifelong ***** resident and former broker on Wall Street. I understand the seriousness of our financial situation and the need for action.
Please do not act too hastily.
If former Goldman Sachs President, Henry Paulson, is asking for unprecedented action to stem this crisis to the tune of 700 Billion Taxpayer Dollars, then please make sure commensurate pain is felt by the stockholders and executives of these firms.
I don't necessarily want anyone sent to jail but the people who orchestrated this mess should at least forfeit their 2007-08 Salaries (above $1 million dollars if you like to avoid hurting the average hardworking employee).
Given my past experience, many of my voting friends have been relying on my interpretation of these events. I hope I am not forced to speak negatively about your actions in this ongoing crisis.
Thank you for your time and continued(?) service,
Sincerely
Thomas ******** tbapple@yahoo.com
Address and Phone # redacted
Those of you who are writing Congressmen might want to just ask them one single question: "How much is this plan going to raise my taxes?"
Has anyone given the taxpayer an estimate of that? Let's hear it. Let us know what we are going to be asked to pay, and then we'll decide if we're willing to take these risks that Paulsen talks about.
Oh ye of little faith. There is a distinct possibility that we taxpayers may actually profit from this. It may actually decrease our taxes. Ha.
comrade awgee writes:
This is not a sub-prime crisis, nor a mortgage or housing crises. This is a debt crisis brought on by a fractional reserve banking system using fiat currency. A "floor in the housing market" will not solve the problem.
I don't think what we will be buying for Christmas is going to be an issue. Christmas will be cancelled, along with the election at the rate things are going...
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
In other words, he didn't have this plan in the works before middle of last week. Otherwise, he would have known to include foreign banks in the first draft. No?
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
Any incumbent who votes for this should be dead come voting time. A challenger should be able to say that "this so-and-so fiddled around while watching Rome burn, and then voted to have your grandchildren pay for their own incompetence." But my guess is that it won't matter and the same feckless idiots (both political and financial) will still be in power a year from now.
"Sept. 21 (Bloomberg) -- U.S. Senator Charles Schumer said the administration's $700 billion financial rescue plan ``needs changes'' to add mortgage aid for struggling homeowners and oversight of the government's intervention"
p.s.
"we all bankers now..."
you go to bed thinking this is madness just to wake up and realize, you haven't seen insanity yet!
Hang it out in light of day & let's see what we got. If it stands up to scrutiny - do it, if not do something different... maybe nothing if we can't agree or the alternatives are worse [there is always the bankruptcy courts - didn't congress just 'reform' them?]...
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
I find it interesting they have repeatedly had to amend no-shorting orders to keep the market from imploding as a consequence of fiat policies. Not once but twice now. Very bad sign.
EVERYBODY is finance saw this coming, don't kid yourself. The CEOs saw it coming but thought they could time it. I used to work at a specific investment bank that is no longer independent, and its chief economist was publishing article after article at the time trying to prove his point that there was a real estate bubble - in late 2004 and 2005. And everyone said no bubble, just froth. And he was insistent. That year that particular bank was the largest global underwriter of mortgage backed securities.
Bond Girl | 09.21.08 - 12:16 pm | #
I was in a similar situation at an insurer, and was told there was no point in preparing for a breakdown of the financial system because if that happens we're screwed regardless.
Which wasn't an irrational response. But if even the industry whose raison d'etre is surviving catastrophe was on the "gotta keep dancing" meme, things were grim indeed.
No more borrowing
The Democrats should demand an end to the foolish wars in Iraq and Afghanistan.
And another 200 billion or so haircut to the Military Industrial complex aka the Defense Department.
And special tax rates on the wealthy to help pay for this fiasco.
rich writes:
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
He would be persona non grata at the Polo Club on the Caymans... can't have that can we?
rich writes:
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
In other words, he didn't have this plan in the works before middle of last week. Otherwise, he would have known to include foreign banks in the first draft. No?
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
rich | 09.21.08 - 12:37 pm | #
This an astute observation. They are clearly making this up as they along. This will end badly.
In 1989 it took 8 months for the DDR (East Germany) to disintegrate, implode, become a debris field.
Escariot | 09.21.08 - 12:34 pm | #
I spent a summer there in 1991 and the people still didn't know what had hit them. It took them longer than 8 months to catch on to the "lie, cheat and steal" global economy.
One thing I'll never forget is going to a bank with a local amateur jewelry-maker. I had asked him where he got his gold stock and couldn't believe his explanation, so I made him take me. Sure enough, at his local bank there were BAGS AND BAGS of 1930's St Gaudins $20 pieces. All the rare dates (which explains why they were the rare dates, I suppose). The bank sold them at spot but wouldn't let me choose the coins I got.
If I have to pay for this recapitalization, I want it to pay off. When SWFs and so forth injected capital, they did so on advantageous terms--Treasury, for example, is supposed to get 11 percent from AIG. As I recall, the people who pumped money into Citi got 8 percent or something like that.
So if me and my J6P buddies have to pay, just add a new deduction to the old pay stub. And give me my share of senior preferred shares in the First New International Bank.
We are all idiots. We know this isn't capitalism or democracy, yet we think the way to fight is to write a letter--or threaten not to vote for someone. Shit, find a ship and dump some tea.
With people like paulson, bernanke, wall street critters, congress critters and greedy "homeowners".. do you really require an anti-christ.. I mean, I could not have done a better job
Excellent move: include the foreign institutions. Of course they are right to do that when following the mad logic of this bailout.
But doing so will raise even more red flags and may be the undoing of the plan.
Gretchen as the perfect counter indicator was asking today who is benefitting from the AIG bailout and got UBS and other European banks on her radar benefitting from the gurantees on the morgages being honored. No, she is not righ. She just spotted a current bagholder - money was made on the receiving and middleman side. But her suspicion will be widely shared.
For tens of thousands of IB employees who received several annual bonuses of 100K on up into the millions and then lost their jobs, as well as the millions who did not benefit, the corrupt path of credit expansion has reinforced the meaning of cutting hay while the sun shines.
"We are all idiots. We know this isn't capitalism or democracy, yet we think the way to fight is to write a letter--or threaten not to vote for someone. Shit, find a ship and dump some tea."
Well, if I wasn't hopping mad before I sure am now.
Let's take some words out of John McCain's mouth, out of context, and cast them in a more appropriate light. We need to "eliminate this burden on hardworking middle-class Americans." NOT the financial crisis, but the staggering load that is going to be placed on those very middle-class Americans in the form of future taxes and loss of a free market, with all the attendant societal "disruption" that implies.
This is a bailout of the financial elite, now including foreign individuals and entities, at the expense of Joe and Jill ... who have suffered enough. Wall Street needs to feel some serious pain at the executive comp and stockholders equity level for this to even stand a chance of flying in a free America.
The serial abrogation of fiscal and civic responsibility by the financial elite is the root of this problem, starting with Greenspan and trickling all over the place. It's now time for the financial elite to pay the price of their irresponsible binge.
Wall Street got drunk all right. Bush nailed that one. Now it's time for the hangover, and taxpayers are not the ones to suffer that ... or if they do, the pain needs be shared, in large portion, by the financial elite.
The provision that this bailout may not be reviewed by future Congresses or by the Courts moves us further in the direction of financial tyranny. I will vote against ANY incumbent, regardless of political affiliation, who supports this lipstick-less pig, and I urge my fellow citizens to do the same.
This plan needs serious revision NOW. Treasury better get their butts in gear coming up with something that is palatable to voters and taxpayers. Otherwise, kiss the U.S.A. goodbye. We will devolve into a kleptocracy, and will have as much legitimacy as the various puppet regimes around the world that Bush so regularly disposesses of the notion that they have any legitimate international standing. We will go begging when it is time to fund the doubling of next year's projected budget deficit - spending will be slashed everywhere but in the areas of defense and rescue of the financial elite. EVERYTHING ELSE will be under the gun, and society will suddenly find itself under very, very severe stress.
Treasury has not thought this rescue of the financial community through, that much is clear. I'm with Krugman on this one ... "no deal!"
Well, if they didn't do this, Goldman Sachs would just buy the garbage from UBS and re-sell it to the Treasury, pocketing a fee...
第一
damn you Nemo!
Hey, I'm starting to really like this plan.
We are all bailed out!
The bourse is open for business comrades.
One bank to rule them all;
One bank to bind them...
Paulson screams the sky is falling. Congress gets steamrolled in an election year to write an 700 1000 million dollar blank check?
It's absolutely insane. There has to be a better way/
US taxpayer bail out the world!
So we are not only the military police of the world, but now the financial police of the world. The Washington politicos have gone completely delusional.
If you start with insane premises, you will arrive at insane conclusions, even if your reasoning is sound.
Whatever, we are going to default anyway. This is all just nonsense. Do you really believe that we will pay it back in real goods and services? Unlikely.
Nemo has automated aid Imelda.
So I just want some clarity here. if we are bailing out everyone, who is fronting the money?
All the companies would have been immediately transfering assets to their US affiliates anyway.
How much of this crap is on UBS and DB's balance sheets?
Whatever keeps the Republicans in power.
Unbelievable. The cost will be unimaginable. We are all collectively subsidizing the foolishness that was evident to anyone with a clue back as early as 2004-2005.
Okay I'll be overly self-involved and repost this from the last thread, since it's more apropos to this one. Looking in the RE section of my local paper, an awful lot of the foreclosures were financed by Deutsche Bank and HSBC. And my bank, Citizens, is now owned by RBS (Scotland). So if Paulson & henchmen are going to take toxic loans, how can they not avoid buying up those financed by 'foreign' banks? How does one define foreign?
Not treating those institutions the way US institutions are treated would be WAY worse than, say, the Dow falling to 8300 (which would, I believe, present a buying oppty). Given the absolute importance of foreign credit to our economy, that would truly freeze up the credit markets.
Re: Byz_Ruin's point about who is fronting the money - genius, isn't it!
I guess we now know what ??? means.
Does McCain realize he is, at best, the fall guy for when this all implodes?
If Obama wins then this implodes... well, it will be 50 years before another black man gets a chance.
OK, OK, I will stop jumping in first for at least the rest of today. Because (a) I am a nice guy; and (b) I will not have Internet access.
Ah you poor rubes. The financial powers don't actually expect this proposal to pass. And they don't care if our Congress stops it, as it should.
They ask for sweeping and unconscionable fiscal power, since they already have the same level of monetary power in the Federal Reserve.
Fannie and Freddie already have the power to buy all the very same toxic waste. And the Fed already had the power to monetize it, even before the July law.
Be outraged as I am, and call your Congresspeople, as I did. But don't entertain any illusions that defeating this proposal will make a difference.
Well screw everybody....I'm off to my undiscovered island where I pay taxes to myself, sell food to myself and watch the sun go overhead.
Is it wrong to pray for the dollar to get crushed?
That's okay Nemo, we all need someone to rail against! Enjoy your Sunday.
Time to for people to hit the streets at protest before we hit the skids .
as the world gets fed a delicious PB&J sandwich. i knew you guys would share!
PB&J = Paulson Benanke & J6P
I think we should start learning Chinese and how to become very good tour guides to show our wonderful partly underwater ruined cities to our future overlords.
Capitalism with bagholder characteristics.
128 million dollars a word.
Doubling the national debt in two weeks at the tail end of the administration.
Has anyone thought about what the Chinese administration might be planning?
I want you guys to lay off UBS. They have a branch in the Canton of Zug.
Is this new setup really designed to help out foreign companies, or is it designed to bail out companies (like AIG, for example) who are ostensibly American but have offshored their incorporation status in order to avoid paying taxes?
So who -- Obama or McCain -- is our next "Hoover?"
Can we say Haluburton ?
Comrade Midwest Product writes:
Is this new setup really designed to help out foreign companies, or is it designed to bail out companies (like AIG, for example) who are ostensibly American but have offshored their incorporation status in order to avoid paying taxes?
Good point, midwest.
AIG is Bermuda domiciled.
Just vote no. This is the worst idea from any administration, ever.
A market collapse would be better than this plan.
Foreigners
Also
Ream
Taxpayers
The odd thing about the bailout plan is that while it has taken the heat off of the insolvent banks, it's now causing much more attention to be paid to our insolvent government. Is that really a step forward for "confidence"?
Paulson on Meet the Press now.
Could this be the WORST BILL EVER considered for passage?
How could anything be worse than this.? Anything "Iraq" is better than this piece of sh*t.
And where the F are the democrats to challenge Bush? Feckless chicken sh*t lemmings.
The Republicans are just as bad.
How this doesn't end up on the docket in the Supreme Court tomorrow morning is amazing.
Call your representatives and senators. Fax, e-mail, call. Let them know this is crazy and they are gone on Nov 4 if they vote for it.
I'm not normally a conspiracy theorist, but does anyone else suspect that the Chinese are using the thriftiness of their people and the proflificacy of Americans as part of a long range plan to establish themselves as the world's only superpower?
Sta
I just puked.
MiTurn writes:
So who -- Obama or McCain -- is our next "Hoover?"
And, playing the role of boob Warren G. Harding, our own, Chimp W. Bush?
Evolving metaphor: awesome party, $1,000 bottles of wine and scotch, $100 cigars - when the tab comes due, skip and leave it for the waitstaff.
Hi fellow waitstaff!
No way this goes through. When does the house start voting?
We're all AIG now-- Man U is still wearing their shirts!
Nemo=CR? or Nemo=Tanta?
That, especially the latter, might explain many things
Here's what I don't understand. The reason why the Great Depression was a horrific event was that there was virtually no social safety net in place when it occurred. But there is a safety net now!
We have no clue if this plan will work, but one thing's clear - if it doesn't, we're all out of options and out probably over $1 trillion.
Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?
This doesn't make any sense at all.
JimK writes:
So we are not only the military police of the world, but now the financial police of the world.
Really, could someone articulate the difference?
Although the stock market had a frenzied historical rally based on this whole scheme; it might represent the last opportunity to get out before realization sets in to the full ramifications of such knee-jerk policy.
Real estate will keep falling, but inflation in the rest of the economy could skyrocket. Interest rates might end up going through the roof.
I don't think there is a free lunch out of this.
Paulson drinkin' ur milkshake.
CR,
I believe it also opens up the buyout to whole mortgages and even real estate-related loans, like the ridiculous condo construction loans that Corus made all over Miami Beach.
Can you believe taxpayer money would buy up the stupidest loans that banks have ever made, in never-to-be-completed buildings, at pennies on the dollar?
Despite all the dutch auction hoopla, you know damn well that if Corus threatens to go under, their loans will be rescued before others. The lack of transparency Paulson has built into this is designed to cover up the fact that it really will be lender-based (without requiring sacrifices from lenders), not asset-based.
This doesn't make any sense at all.
Nobody
Au contraire, mon frere.
This all makes perfect sense.
"Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?"
Because the criminals run the prison.
Volker The Viking:
Really, could someone articulate the difference?
Honesty of policy apparatus and duration of commitment.
is there a chance that this bailout legislation will be challenged in congress? everyone, especially the stock mkt, is assuming that the bailout becomes law on monday...this could be a problem...im an avid reader of history and i am now convinced that we are in the midst of the most significant event in the history of western civilization. There are too many people on the planet. close to 7 bln...nature doesnt like it, one bit..nature throws at us hurricanes, tsunamis, earthquakes, war, disease; this credit crisis not only now joins he list and is soon to take #1 spot. fiat currency destruction is nature's number one aim right now..it is now inevitable.
how can we trust a Goldman player and give him extra-constitutinal power?
Fire him as the situation deteriorated under his watch..
By including foreign banks, this means that the price paid by RTC II for toxic waste will almost certainly not be above market. Otherwise, they would be using taxpayer money to recapitalize foreign banks, which would be political suicide. Since the terms will be the same for domestic and foreign banks, the clear implication is that no recapitalization for domestic banks is contemplated through RTC II toxic waste purchases. Of course, this does not mean that some other means will not be used to recapitalize US banks. But it means that they have still not figured out an accepatable means to do this.
Questions
If the government received about 80% of AIG equity in exchange for an $85 billion loan, is Paulson suggesting taxpayers receive nothing from bailed out banks, whose stocks would rise, to the benefit of shareholders and debt investors, including those who created the mess, who stand to reap profits from taxpayer monies?
Should banks pay shareholder dividends with taxpayer dollars?
If hedge funds and foreign firms are not eligible to participate, what prevents them from selling or exchanging near worthless securities to eligible US banks to offload on to US taxpayers?
Is legislation stating Decisions by the Secretary are non-reviewable
and may not be reviewed by any court of law or any administrative agency,
constitutional?
Does bailing out the Banks & Wall Street revitalize the housing market, simulate consumer spending or increase Government Revenue?
If the S&L bailout cost taxpayers $125 billion
and the original estimates were somewhere between $30-50 billion
how much could a financial institution bailout cost
if initial estimates are $700 billion to 1.2 trillion?
Should the USAs debt rating be AAA?
I wonder if this charity will help improve our global image?
So we are not only the military police of the world, but now the financial police of the world.
Really, could someone articulate the difference?
The American tax payer paid for the military, against his will, but in the financial case he may end up in a Chinese debtors' prison.
From ABC News: Treasury Secretary Henry Paulson said this morning that the White House will push for foreign firms to be included in the $700 billion financial industry bailout.
"We are talking very aggressively with other countries around the
world," Paulson said in an interview on ABC News' "This Week." "If a financial institution has business operations in the United States, hires people in the United States... they have the same impact on the American people as any other institution."
Tell that to the Germans.
Another thing worth remembering is that there are no real estate assets involved. This is a taking on of the Federal government the obligations for bundled securities that have been sliced, diced, tranched and shuffled. There is no clear recourse to the underlying real assets these 'securities' represent. It's just more paper, more fiat currency if you will, spun from whole cloth by the shadow banking system.
No way this goes through. When does the house start voting?
This bill will pass with at least 80% in favor. The best we can hope for is clamoring for (a) the removal of language giving Paulson godlike powers to never have his decisions reviewed by the courts, and (b) the addition of serious punitive measures against firms who sell us crap loans, especially against the management.
This would complicate a default on Ts, if we borrowed the money to help foreign govs too.
I predict if the Dems refuse to pass on this, it will be issued as an Executive Order by the President.
we are the cancer patient--everytime we see the doctor, the treatment and the prognosis is worse.
I don't see how inflation can dig in to this mess. It's obvious they keep trying to goose it but there isn't anything for it to latch onto. Wages are not going up and folks are cautious about spending and banks aren't lending. Money is not circulating no matter how much they keep injecting into the system.
Hopefully someone else sees inflation and can point out the signs.
Going down the fed's crazy path of credit expansion the last 10 years has led to a location where every next move is insane.
Wherever you go, there you are.
Has anybody seen Russia lately. They are now buddy buddy with Hugo and Cuba again.
If they decide to put nukes back in place 90 miles from our shores, what the F can we do? Nothing!!!!
We are too fragile now to even contemplate paying for another military action.
Besides, China will dump our treasuries and screw us. The world now has us by the nuts!!!
Congratulations, you born and bred dopes!
Probe, don't diss Harding. Lol.
Ok, say this stabilizes the real estate market and everyone is happy.
Folks who want to get from under their house (i.e., don't want to get stuck holding the bag again) all of a sudden put their homes on the market.
Inventory sky rockets. Builders get back to building.
Then what?
Unless there is a final bill to permanently loosen lending standards to the 2003-2007 criteria, there is no way they sell these houses.
I guess that's bailout number 40 or 50.
Japan style economy is right on. It seems unavoidable.
MrM --
Please do not insult CR and Tanta like that. I wrote a Perl script. It's only like 40 lines...
Have a good day, everybody; I am off to travel. Try not to burst any blood vessels.
Just keep sending the oil and the plasmas to us. Thank you.
And keep in mind that we are still working our way through the resets of recent year groups. The real acceleration of this situation is yet to come.
"US taxpayer bail out the world!"
I am now convinced we are simply heading into a period of supercharged hyperinflation. Concentrate all the debts on the US balance sheet and then inflate them away.
.
Ralph Nader for President is looking pretty fucking good right now...
.
Finanziellfuhrer
They'll be back sometime during 2009 to increase the total allowance to $1,000,000,000,000, up from $700,000,000,000.
Damn, dis more fun dan a rat killin'.
The Chicomms smile an inscrutable smile having done what Cousin Nikita could not. They have successfully hanged the decadent west with a rope we sold them.
CR writes: U.S. taxpayers may bailout foreign financial institutions and even foreign governments.
Truth be told the correct wording is; "U.S. taxpayers may bailout foreign financial institutions especially foreign governments."
I've just tried summarizing the bailout plan (or at least, my understanding of it, which might be something else entirely) in simple terms. Can somebody who knows what they're talking about give it a look through to see if I've got the gist of it? I don't think I've left anything important out, other than the free ponies.
It's my first ever blog post, so go easy-ish. Thanks!
We are now BAILING OUT everybody? The ENTIRE financial system of the world, bailed out with US funds we don't have?! This is MAD! DELUSIONAL!
The GIG is UP. GAME OVER. REBOOT!
Imagine the carping in the US if this was happening in Europe. As it is everyone in the US seems to be too stunned to be able to do anything. So many issues and questions raised by this. Essentially its Financial Martial Law, Treasury can do what the hell they like and they set the rules as they go along so as not to hinder 'progress'
CONTACT YOUR CONGRESS PEOPLE ASAP!
====================================
I am writing today to ask that you vote NO for any BAILOUTS of the financial industry.
Wall Street and large banks made fortunes during the housing bubble boom years and shared little of that benefit with the American taxpayer. Why should the taxpayer shoulder the burden of bad decisions by both the lenders and the homeowners now that the bubble has popped? I understand the need to prop up certain failing institutions for the short-term, but a wholesale bailout of bad decisions will lead to more of the same a few years from now.
When bailouts are necessary, they should only come at a steep price to the shareholders, the debt holders, the management teams, and the homeowners who participated in this massive ponzi scheme. Risk takers (lenders and borrowers) who nearly annihilated our financial system should not be rewarded.
It is patently unfair for the taxpayer to pony up a blank check for up to a $1,000,000,000,000 without reforming the system and ensuring fairness and accountability are properly implemented. Any bailouts should only be attached to massive reform legislation that prevents bubbles of this magnitude from occurring again.
In addition, the debt loads for this proposal will make borrowing costs for everyone much higher. We either take the short-term pain of dealing with the crisis in the free-markets or pay for it later in higher taxes, higher interest rates, and higher commodity prices (think oil/gasoline) under the state capitalism proposal currently on the table by Bush and Congress.
I will be watching your votes carefully on this historic legislation. If you endorse this irresponsible bailout, I will do everything in my power to have everyone I know, come into acquaintance with, or otherwise contact - to vote for the presidential candidate in the OTHER PARTY.
The Chicomms smile an inscrutable smile having done what Cousin Nikita could not. They have successfully hanged the decadent west with a rope we sold them.
The attachment to the limb in question is also a hangman's noose, and the limb is their neck.
The downside of having the worlds reserve currency. It was pretty easy living for awhile.
With apologies to Winston Churchill:
Never have so few F____ed so many for so little.
.
This bill will never pass now that it's out on Drudge that we'll be buying these assets off foreign firms.
ice typing, friardaddy.
"We are now BAILING OUT everybody? The ENTIRE financial system of the world, bailed out with US funds we don't have?! This is MAD! DELUSIONAL!"
Who do you mean by "we?" The "financial system of the world" is planing its bailout through its acolytes in the Bush Administration and elsewher in Washington. It's saving itself. The citizens of the U.S. are just the chumps who make it possible.
Evil doers. Freedom. Strategery.
The Bush Legacy....he just turned America into a giant Hooverville
This bill will never pass now that it's out on Drudge that we'll be buying these assets off foreign firms.
Executive Order time, then.
"Stroke of the pen, law of the land"
Nobody writes:
This bill will never pass now that it's out on Drudge that we'll be buying these assets off foreign firms.
I'd be willing to bet a great deal of my recently devalued currency that it will, and very much intact.
What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling.
It's a much more likely outcome than appeals to patriotism, logic, or fiscal prudence.
That's if we are lucky.
This bill will be passed in an all but intact form, exactly as FRE/FNM bailout was
Paulson hopes to restore confidence in the US financial system, and bring back the foreign investment that comes with that.
What he's likely to find is that the rest of the world is more the willing to exchange their mortgage junk for T-bills, but unwilling to put new money in to restart what is now certainly viewed as a mortgage ponzi scheme. After all, they've been played for the fool on that one.
The worlds investors will need to see the US housing fall to its true floor. A floor not supported by government bailouts or pricing supports. Then, after years have passsed, foreign investment may even return to support real estate.
They will Christmas tree the thing
Thank you Lawyerliz! I did not know that slang term for that sort of bureaucratic process.
What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling.
Yeah - there's that, too. There was talk of an extra $100 billion stimulus package. Chris Dodd was even talking about tacking on credit card debt relief.
It's not going to pass.
This will pass with more Dems voting for it than republicans--that way they campaign against themselves and make dems look like bushies. Dumb and dummer. naive vs. evil. wmd redux.
*** Blast from the Past ***
*** The Executive Order Hit Parade ***
Executive Order 9066: Franklin D. Roosevelt delegated military authority to remove all people (used to target specifically Japanese Americans and German Americans) in a military zone. The authority delegated to General John L. DeWitt subsequently paved the way for all Japanese-Americans on the West Coast to be sent to internment camps for the duration of World War II. Thousands of German Americans and Italian Americans were also sent to internment camps under executive order.
This will pass easily sans the normal intelligent commentary from the Bunning's and Boehner's in the room.
The sheeple don't get it. AND they REALLY want their homes value to back up. Their housing atm card hasn't been used in a while.
Should anyone care, the "inscrutable" comment is mine.
Anyway the core of the problem is that the US is too rich relative to other nations and needs to be made poorer now that our ability to raise living standards around the globe is slowing. Sounds simplistic but everything for the last near 40 years has been about establishing social justice/equity. The global warming hoax, NAFTA, free trade, outsourcing, intellectual property theft, on and on all serve the end goal. Now we have a "financial crisis" of global proportions and who gets the bill?
Executive Order time, then.
Yeah, there's always that possibility.
Lawyer liz -
This is one of those times when the inefficiency of the US government (deliberately built in, thank you James Madison) may work for us.
Or not.
Volker:
I'd be willing to bet a great deal of my recently devalued currency that it will, and very much intact.
We shall see.
This will pass with more Dems voting for it than republicans
The Dems may try to hold out because they are trying to attach more provisions for funding their constituents...Another reason this
may be issued in Executive Order form, IMO.
Larceny has been elevated to an artform. Deep, dark political art, a new form of drama if you will. Art defeats life.
U.S. Senate: Senators Home
Write to your congressmen. And spread it around to all your friends. Make them at least think twice.
Congratulations, you born and bred dopes!
Anonymous | 09.21.08 - 11:17 am | #
home schooling's results.
What's so hard about stipulating that any institution that uses this bailout must limit the total compensation, by any means, of any individual employee to no more than the salary of the President of the United States? This compensation limit would be applicable for 2008 through 2010.
Since we're gonna borrow the money from 'the world' to fund this thing I suppose it is only fair to let them in on the bailout...
"We are the world, we are the children..."
This is not going to improve the housing (inventory) situation at all. The best this could do from a social standpoint is relieve people currently at risk of foreclosure. And those people won't be buying houses. This is just to bail out Wall Street (and apparently financial institutions worldwide), in hopes they do not pull the debt out from under our feet. So we can still have business loans, car loans, student loans, credit cards, etc. I think it shows how much of our "growth" is financed through debt. As for housing inventories, we'll pass that buck to the next administration.
There is no way in hell the Dems are not going to rubber stamp this beast. Do you really think they are going to delay it with potential poison pills after they said it was the end of the world if it didn't pass? And risk and adverse market reaction solely attributable to them on Monday? No way. They are only sensing they have a modicum of leverage here (no pun intended) because it is likely there are a few free market Republicans will oppose it, and that will make the Dems' position more important. Has anyone seen a democratic legislator come out and say they are flat-out against it? I am curious if you have, but I think this thing is as good as done.
Another thing - how much of the banks' earnings were based on their ability to generate these instruments? Most of it. Even if we buy this crap off them, they still might not have a sustainable business model. And then we really will be out our trillions in corporate welfare.
See?! The velocity is such that even before the ink is dry it grows!
I am almost afraid that by tomorrow morning Paulson will say "never mind...it's too late"
Byzantine_Ruins writes:
Volker:
We shall see.
By, can I call you By? We're all friends here. Yes, we certainly shall see. Where's that guy with the popcorn? Hey, wait! Let's get loaded and gape in slack jawed wonder. We'll need that cannabis guy for that.
Escariot writes:
See?! The velocity is such that even before the ink is dry it grows!
And go back and review the short sale 'ban'. They have already made provisions for the exclusion from the ban for 'certain market makers'.
Hoo boy.
Where's my lunch?!
This is insane. Pushing all of the risk from the HB&B both domestic and foreign onto the government balance sheet is an outright act of treason, as it puts the entire country at risk of default.
Escariot writes:
See?! The velocity is such that even before the ink is dry it grows!
I am almost afraid that by tomorrow morning Paulson will say "never mind...it's too late"
Escariot | 09.21.08 - 11:33 am | #
Scope creep...
I think Haliburton is moving their headquarters out of the country; surely that the only reason needed.
Bond Girl - it stabilizes the markets for a few days so that Titans of Finance can move their money elsewhere. But you're right - this does nothing to help the problem of overpriced inventory.
I am almost afraid that by tomorrow morning Paulson will say "never mind...it's too late"
Escariot | 09.21.08 - 11:33 am | #
How sad is it that THAT's exactly what I'm praying for? That's our only hope now. Asian + Euro markets tonight may be the canary.
And what about the argument that any institution that receives federal assistance should be subject to federal regulations that so many of our esteemed leaders have been touting lately? We can give foreign banks help, but we can't really regulate their core operations can we? We can control what they do over here, but not with an eye to keeping the entire buisiness stable. What dopes.
Escariot is right.
energyecon writes:
Finanziellfuhrer
What is Paulson's new Title? - a Great one!
This "Comrade" meme has got to go - no socialism here. What did people call each other in Nazi Germany and Benito's Italy?
This is not a sub-prime crisis, nor a mortgage or housing crises. This is a debt crisis brought on by a fractional reserve banking system using fiat currency. A "floor in the housing market" will not solve the problem.
Another thing - how much of the banks' earnings were based on their ability to generate these instruments? Most of it. Even if we buy this crap off them, they still might not have a sustainable business model. And then we really will be out our trillions in corporate welfare.
The Mother of all Golden Parachutes. Golden Parachute for them, golden something else for the Taxpayers.
Look at this -
Paulson urges 'clean and quick' OK - Sep. 21, 2008
All i can say is that the CDS problem is more prevalent than it seems.
Waitaminit.
If the idea is to grease the skids of the economy, then --
Why doesn't the gubmint just PAY OFF everyone's mortgage?
A one time capitalist Jubilee.
then
-- everyone would own a house free and clear and feel rich and want to borrow against it.
-- the banks would have all the money free and clear and want to lend it.
-- problem solved.
What am I missing here?
Yes, we certainly shall see. Where's that guy with the popcorn? Hey, wait! Let's get loaded and gape in slack jawed wonder. We'll need that cannabis guy for that.
I prefer Byz.
To be more articulate than glib, I think the mandarins are rallying to set up their awful racket and the sure thing may prove less sure than its masters believe.
The Harriet Meir(sp?) nomination comes to mind. I'm pretty sure this was supposed to be a same-day deal, that could be announced in time for Asian market open. It is seeming it is pretty clear it will not be that. I am very curious about the next 36 hours.
Alas, I have to go into my ByzDome and winnow the PEO PCOs from the non-PEO PCOs and will be away from all the fun. Luckily my cronies SMS me throughout the day with updates.
Oh, now Paulson is preaching the world to prepapre for massive bailouts and it's no more than a few decades since U.S. was preaching the world to let free markets clear themselves and not have governments intervening. What a clown and I'm sure everyone in the world has convenience on U.S., Fed Bernanke and Paulson that they are on top of things. How's that bottom in housing you've been calling many times coming alone, Mr. Paulson??
What? You thought you could keep on making the rest of the world work for peanuts while they financed your spending and stick them foreigners with defaults when all hell broke loose.
Wake up and smell the coffee! Default on your foregin debt and expect war. Americans are stuck between a rock and a hard place.
This administration has not been able to clean up New Orleans after 3 years of promises and who knows how many billions of dollars. Who in their right mind would give them $700b with no strings attached and trust them?
I would trust Putin over Paulson.At least he knows how communism is supposed to work.
Commissar 4822 writes:
This will pass with more Dems voting for it than republicans
Don't kid yourself - GOP is behind this 100% - they have the luxury of being in the minority so can throw hand grenades... if they were in the majority Hank & Ben & Shrub would be sitting on them BIG TIME.
GOP in House & Senate are irrelevant from a power perspective so why not flip everyone off?
Dems did the same thing for years when they were in The Wilderness..
If GOP really wanted to kibosh the thing - force cloture vote and deny the 60 votes... drag it out and talk it to death... longer this vampire stays awake the more likely the sun kills it.
If it passes quickly w/out cloture battle - even w/ votes against - its essentially 'unanimous'.
A lot of the voting in congress is for show & posturing... read between the lines.
For the next president, this will be akin to Van Buren and his one term. Didn't markets of that era seize up just as he was inaugurated to usher in the worst Depression up to that time in the nation's history? That Only difference now is that there are about 320 mln more people inhabiting our nation. It's not so much the numbers that are scary, but the coming social collapse that we should all be fearful of, especially the "haves" of the world.
Does anyone really expect that war will come from defaulting on our debt?
This "Comrade" meme has got to go - no socialism here.
I don't find it such a bad thing. ;^)
It could be what American Voters and Taxpayers will soon need to call each other in this era of financial rule and ruin of the illustrious 'captains' of finance.
Interestly, not one poster here likes this proposal--must be a lot of smart CR fans.
Read Fact Sheet. Not even limited to mortgage-related assets anymore: "Treasury will have authority to issue up to $700 billion of Treasury securities to finance the purchase of troubled assets. The purchases are intended to be residential and commercial mortgage-related assets, which may include mortgage-backed securities and whole loans. The Secretary will have the discretion, in consultation with the Chairman of the Federal Reserve, to purchase other assets, as deemed necessary to effectively stabilize financial markets."
Before asian markets open?
Sure about that? I thought it was friday.
Herr Paulsson sure moves fast if this happens.
Does anyone really expect that war will come from defaulting on our debt?
not war, but servitude the likes of which we've not seen in say, 150 years?
Bond Girl writes:
Does anyone really expect that war will come from defaulting on our debt?
I do.
Three things drive everything in this world--money, sex and violence (not necessarily in that order).
On the bright side, the general public is about to learn a new phrase used by the younger generation: EPIC FAIL.
Bond Girl writes:
Does anyone really expect that war will come from defaulting on our debt?
Raises hand. One word answer: Taiwan.
Don't buy it? Ask Georgia.
If the Dems do not stop this bill they do not deserve to be in power. They are nothing more than a club that hands out the spoils of power to their members.
Let me see if I got this straight (please correct me if I'm wrong):
First point.
1. If only US based companies are bailed out, GS would buy toxic UBS crap and sell it to TARP for a fee.
2. If the company must have a big presence in US in order to be bailed out, the foreign company will transfer the crap to an US branch and sell it to TARP.
3. If we bail everybody, all the crap will be sold to TARP.
Thus, regardless of the policy TARP ends up buying all the crap. Some time ago the wise men said that using derivatives you spread the risk around the world. Well, not only that we spread it to the point where systemic risk took over, but now we bring all the risk/crap back and cover it with a TARP. Isn't this karma?
A second point: the program will buy crap, repackage it, sell the good stuff and keep the bad, then repeat the process. In the end it will have only bad stuff left and no money to buy more crap from banks. So $700bn is gone, and very likely it will not be enough - thus, the next congress will double the amount.
Third point: how far can we extend the TARP? I guess it is related to the percentage between buying price (from the banks) and selling price (after repackaging). Say that in the first step TARP pays $100 to buy crap, repackages it and sells the good part for $90 and keeps the bad part. Now, it has $90 to buy new crap from banks, etc. so the total crap bought through this process is going to be $1000. What do you think: are TARP managers are good enough to get 90% of the value back (either by buying low or selling high)? In that case, is $700bn x 10 = $7 trillion enough to buy all the crap there is out there?
Read Fact Sheet. Not even limited to mortgage-related assets anymore:
Really good point there - this is insane!! It would not be written that way if they were not anticipating something - wonder what it is?
Bond Girl writes:
Does anyone really expect that war will come from defaulting on our debt?
Bond Girl | 09.21.08 - 11:43 am | #
No.
Austerity & forced US 'balanced budget' - 'yes' but war - 'no'...
War might come from other stupid actions but not 'default'...
Credit card relief? LOL My aunt Joan paid $200 for a Beanie Baby. Will she be made whole?
*
"The Tragedy of the Commons is the title of an influential article written by Garrett Hardin, first published in the journal Science in 1968.[1] The article describes a dilemma in which multiple individuals acting independently in their own self-interest can ultimately destroy a shared resource even where it is clear that it is not in anyone's long term interest for this to happen."
"Central to Hardin's article is a metaphor of herders sharing a common parcel of land (the commons) on which they are all entitled to let their cows graze. In Hardin's view it is in each herders interest to put as many cows as possible onto the land even if the commons is damaged as a result. The herder receives all the benefits from the additional cows but the damage to the commons is shared by the entire group. If all herders make this individually rational decision, however, the commons is destroyed and all herders suffer."
"Paradoxically, Hardin's article has been interpreted as an argument both for the privatization of community assets and for increased government regulation." (Wikipedia)
Hardin for President.
.....................
BB:
Sure about that? I thought it was friday.
IMO, the payments system will be toast long before Friday without another game of kick the can. Even a "global bailout" can-kicking might not take it that far. mp / Conjure bag seem to think it's already table-ready, I think it will stagger along til at least Wednesday. Maybe we are hopeless pessimists.
This is the end -- of something. Could be the financial system. Could be democracy. Could well be the middle class. Could be the U.S. as we know it (not the same as democracy, hah).
It's in the waning days of a regime that titanic and hopeless and irresponsibleschemes are mounted to regain past power and glory. Not like I've been around for 2,000 years, but I've read a book or two, as have most of you. All this is... amazingly familiar.
Bailout bill establishes a dictatorship
Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
If the Democrats had any hair, they would blame this disaster on the Wall Street rich guys and vote no. For all the wrong reasons, they would win and stave off this legislative disaster in the making. Paulson is selling the american taxpayer in to slavery to keep this rotting corpse of an economy on life support for another week or two. This is an outrage!
dryfly:
War might come from other stupid actions but not 'default'...
Agreed. In fact if anyone is following geopolitics, things seem to be heating up.
More shock doctrine to follow.
Thundering Herd
I'm sure this has shown up on one of these threads, but I'll repeat the renamed bill I found on Bigpicture, as it is entirely apropos and perhaps useful in explaining this mess to the sheeple: The No Banker Left Behind Act.
"If the Democrats had any hair, they would blame this disaster on the Wall Street rich guys and vote no. "
But then Chuck Schumer would have no friends left.
If they just let the banks fail, the Government could pick up the real estate for nothing, just as it did in the S&L collapse. That would cost the taxpayer much less money.
This may be our Dunkirk
Get as many off the beach as we can
then hunker down next week
Is it wrong to pray for the dollar to get crushed?
Yes ... for now. Let me shed my USD at a decent rate and then you can pray for whatever you want.
The one question I have is hyperinflation in the
cards or are the deflationists right ? I can see both
scenarios playing out but this bailout really tips me towards hyperinflation.
We are being told that without this investment bank bailout plan, that Main Street economy will collapse. However, we were once told that If we did not stop Saddam, he would destroy us with nuclear weapons. I'll never forget the mushroom cloud pictures during Bush's speech. I believe they will allow nothing to get in the way of their market takover plans. The last thing Paulson and the administration want is any serious examination. The American people will never know what hit them, and few will understand why this creation and conversion of tax payer debt into corporate banking wealth is being executed.
If the banks were to receive $.60 on the dollar for their mortgage backed securities, it would be a total gift. Remember, Merrill Lynch "sold" its mortgage backed securities for $.22 on the dollar. ML also carried the paper. In other words, they gave the appearence that they got financial asbestos off their balance sheet, but in actuality, they were unable to sell it. ML had $30.6 billion of CDOs that were already marked down to $11.1 billion. Yet, they "sold" this garbage to Lone Star for 6.7 billion. That left Merrill Lynch taking another $4.4 billion write-down and 'selling' those securities at 22% of the original face value. If it were a real sale, it probably would have gone for $.05 on the dollar, or, possibly, couldn't have been sold at all.
The National Australia Bank (NAB) took a 90% writedown on its 550 million (AUD) in holdings of US mortgage debt. What it did was to admit that it's AAA-rated securities were virtually worthless. So what are these mortgages that the Treasury wants to buy with first $700 billion chunk of US taxpayer money worth? They are worth nothing. This is a gift from the former CEO of Goldman Sachs to his cronies. The first $700 billion increment of mortgages bought by the taxpayers will constitute a direct payment to the very banks that destroyed the American economic system. These mortgage backed securities will be collateralized by the absolute worst toxic waste the banks have been stuck with. Once in posession of this money, the banking elites can continue to pay themselves huge bonuses, while continuing the leveraged looting that became legal the day Bill Clinton Signed Phil Gramm's bill (Gramm-Leach-Bliley Act), a bill that vitiated the Glass-Steagall Act.
Trotsky writes an insightful post.
I remember watching (from a great distance) the Red Brigade and the show trials followed by the exiling and internment of the leaders and operatives.
I mused then, 'whata perfect example of the futility of central state planning'.
They (the Red Brigade) had a reference document.
Could CR possibly create on round which we might all rally?
Nobody writes:
Why don't we allow the market correction to play out, temporarily expand the social safety net, and use the remaining resources to clean up after the failed institutions?
Woo hoo! More welfare for all! Vote Obama!
Sent to the Houston Chronicle as a letter/op ed - who knows they may even print it:
Once again over the weekend, the duly elected representative government of the American people are being stampeded towards an abysmal policy in the guise of securing the financial system from an apocalyptic meltdown. A policy that is to be funded by the taxpaying public without oversight or recourse, to be administered by unelected bureaucrats who will appoint companies from the financial industry to implement the program.
All we need to do is write the biggest blank check in American history, have the Congress abrogate every constitutional responsibility of fiduciary oversight, and appoint the Secretary of the Treasury the 'finanziellfuhrer' and trust Washington to get it right. You know, the problem they told us was 'contained' to sub-prime mortgages.
The problems with this proposal are myriad, and we arrived at this situation over a generation of excessive credit use. Rather than get into the intricacies of securitization, dollar recycling by China and the Middle East to finance our twin deficits, strains in interbank lending implicit in the TED spread or skyrocketing commercial paper rates, let me share a metaphor with my fellow citizens.
Wall Street financial institutions have been having one heck of a party, with $1,000 bottles of wine and scotch flowing like water, $100 cigars being enjoyed by 'the masters of the universe' and only the finest caviar served to be savored by this select crew. Now the check is being prepared and the black tie crowd is slipping out the side door to leave it for the waitstaff, the US taxpayer.
This will be sold as averting the economic apocalypse, as costing less than the alternative and can even make money for the taxpayers - just put all your trust in the 'finanziellfuhrer' as he makes every bank in the US and around the world whole on your dime - it's for your own good!
The sad truth is that bitter economic medicine is coming, all this is about is who will pay the tab: the people who made the mess or the US taxpayer. Call your Senators and member of the Congress and tell them "Stop the madness!"
In 1980, Jimmy Carter asked Castro to allow Cubans, who wanted to leave Cuba, to leave and come to America. Castro did exactly what Carter wanted, and not only allowed, but sent 125,000 Cubans from Mariel Harbor to the US. This was called the Mariel Boatlift.
Who were these Cubans that "escaped" to America? Most were the dregs of Cuban society, because Castro emptied the jails and mental institutions and shipped them to the US, where Carter was waiting with open arms. A major crimewave in Florida was born.
Paulson is engineering his own Mariel Boatlift of sorts. When the major banks receive their shares of the first $700 billion, they will open the floodgates and saturate the American taxpayer with mortgage backed securities collateralized by the most undesirable real estate possible. There will be boarded up houses from Cleveland, Detroit, Gary Indiana, Johnstown, Ohio, and vacant tract homes from places like the Inland Empire desert to Weld County, Co. Then Paulson will ask the American taxpayer for billions more to manage these unsaleable "assets". So, not only will the banks get hundreds of billions of dollars, but they will be relieved of the financial and moral liabilities of having to manage these piles of so sticks, bricks and vinyl siding.
I think we are missing something here.
Paulson is TRYING to load this up with poison pills, so it will get rejected and the blame can be put on the democrats. And/or let the democrats load this up to the gills with additional costly provisions.
GS stands to GAIN if the other banks go under. Paulson doesn't want this proposal to pass anymore the we do.
My guess is he thought the $700B number would scare them off...but the called his bluff, so he needs to up the ante.
For those angry enough to act: contacting your member of congress is good -- contacting your state/local officials can be useful as well -(see search box in upper left to find all of your elected officials):
Congress.org - Get informed, get involved
If you call their offices, all these officials have staff dedicated to taking complaints/solving problems -- if they get inundated with calls, they are going to do somethig -even if it is simply informing your officials that the public is outraged.
one of the BEST things you can do is contact your local media - TV station /radio/ and newspaper - and register complaints, and ask why they aren't knocking at elected officials' door and covering this more. They get enough complaints, it's a story.
Get a few folks together in your neighborhood, church group, whatever - even if it's just your family, and organize a protest, or pass out flyers in front of a bank (yes it's small potatoes, but press are much more likely to cover if there's some kind of visual/audio element they can whip up for their newspaper-website pages or the TV news.) The more visual, the better (can you rent pig costumes - or at least buy those pig noses at a Halloween store?).
Some national media numbers (I recommend phone calls at this point -ask for the newsroom / news assignment desk to try to get through)
FAIR's Media Contact List
Hey guys,
what about this sentence "To qualify for the program, assets must have been originated or issued on or before September 17, 2008" How does this help banks when most of the toxic paper has already been issued before that date?
black swan wrote: "That left Merrill Lynch taking another $4.4 billion write-down and 'selling' those securities at 22% of the original face value. If it were a real sale, it probably would have gone for $.05 on the dollar, or, possibly, couldn't have been sold at all."
Review the facts and you'll rediscover that this is indeed what happened--five cents on the dollar. ML carried back the rest.
You probably just disremembered.
Rob Dawg writes:
Bond Girl writes:
Does anyone really expect that war will come from defaulting on our debt?
Raises hand. One word answer: Taiwan.
Don't buy it? Ask Georgia.
Rob Dawg | Homepage | 09.21.08 - 11:45 am | #
There is a saying in geo-politics... "Geography is more important than policy."
Look where Georgia & Taiwan are... they could have been taken any time they wanted (they being Russia & China). About as big a deal as us taking Chihuahua or Cuba - is it worth it? Is it necessary? What does it do for us?
I don't see our financial problems speeding up or slowing down this process when & if it ever happens.
If Taiwan becomes a PITA to China like Georgia was to Russia - China grabs or neutralizes it. Georgia is a non-problem for the Russians now... better than if they took it over. China can do the same thing almost anytime it wants - we will NOT go to nuclear war over it regardless of McPalin mouthing off.
There are a lot of ways to skin a cat. Chinese know this better than anyone.
Sec. 8. Review. Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
I'm not sure but I think " committed to agency discretion" means secret.
And after you send letters to your paper, call its newsroom assignment desk and ask for more stories / investigative pieces and polls of Americans to determine whether the taxpayers support this.
want proof that that the bush administration and banksters are criminals?
easy
If (if) this is really about subprime and alt-A and even prime defaults...then why not just have the fed gov buy the properties...
rather than the toxic securities
at least that way the taxpayer would own something has has some material value even if it is just 50 cents on the dollar.
the toxic securities they propose to buy instead are intrinsically worthless.
not only is the tapayer getting effed over...but the tax that ultimately will pay for this mess
is not a progressive nor a flat tax..
it is a regressive tax...its called inflation
the min wage class and the middle class are screwed.
Byzantine_Ruins:
If it passes verbatim by monday.
Maybe it really IS time to divest out of Any dollar denominated assets.
Bond girl writes:
The Mother of all Golden Parachutes. A Golden Parachute for them, a Golden something else for the rest of us.
Aha! Now I get it! This is what they really meant by Trickle Down Economics!
Well screw everybody....I'm off to my undiscovered island where I pay taxes to myself, sell food to myself and watch the sun go overhead.
grumpyoldvet | 09.21.08 - 11:00 am | #
if you founded such a place, i guarantee there are like-minded comrades to join you.
Comrade Ron Paul on CNN live.
dryfly wrote: "China can do the same thing almost anytime it wants"
and they will when the cost is the least. They won't even have to invade, just land an official jet and pronounce the fait accompli.
Got Gold?
Interesting. At the end of the Clinton Administration there was this big concern about the budget surplus and a plan to slowly pay off the national debt (with calmer people suggesting maybe paying off the national debt wasn't such a good idea). At the end of the Bush Administration, we have, well this . . .
And yet the Republicans have successfully marketed themselves as the party of fiscal responsibility, prudent and conservative stewardship of the free market economy, etc.
I think the Reagan legacy is kaput. And I think the Republicans are going to need to rebrand themselves.
The Paulson proposal boils down to, trust me, I know what I'm doing. I'm not sure if that's a good idea, or not, and if not, what the alternatives are. Something tells me that the answer to that question depends on whether you take a short term or long term perspective.
How much is a trillion dollars? If you spent $1000 per minute, it would take roughly 2000 years to spend a trillion.
we will inherit the wind
Cut the straps on the golden parachutes and let those mofo's freefall along with the rest of us.
-GSD
As any first year law student can tell you, section 8, purporting to preclude judicial review, is complete bullshit.
This is a diversion, a red herring. They are pulling our strings so we'll focus on this ostensible blatant power grab.
They'll "negotiate", Democrats will bluster, it will get dropped in committee, and the Democrats will crow how they clipped Hank's wings and preserved judicial review.
And everyone will breathe a sigh of relief.
Even though his actions would have been judicially reviewable no matter what the statute says.
The really nefarious thing is the blank check for Hank. There are no limits on his exercise of discretion. THAT is the problem. Section 8 is not the problem. The courts can review, but there's nothing to review if there are no meaningful limits on his actions.
trickle down economics...?
is that like being trickled o
Anonymous writes:
Got Gold?
And those who do will hear: Gimme it. from the PTB
I worked as legislative staff for a state representative in Alaska many moons ago, we use to say that how someone said they were going to f@ck you in government was "Trust me."
"Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."
Translation: Bush not longer needs Congressional authorization to appropriate funds.
Two excellent posts by Paul Krugman:
Thinking the bailout through - Paul Krugman Blog - NYTimes.com
Authorization for the use of financial force - Paul Krugman Blog - NYTimes.com
The first suggests the alternative rescue plan of having the govt buy stakes in companies as the way to recapitalize firms, and then have a share of future upside potential, and also, implicitly, a quid pro quo for transparency and regulation.
The second post is shorter and, I think, more important. There Krugman implicitly compares the handling of the current crisis to the handling of 9/11 and the Iraq war vote. This is more important because demanding checks, balances, judicial review, accountability, and transparency in the rescue plan allows the country to make changes in the future - in contrast, the Bush Admn used terror to demand total authority and secrecy, which could then be used to push back on any argument for change. That cannot be allowed again.
"They (the Red Brigade) had a reference document."
I guess watch for a new provision at 11:59 PM tonight providing for internment of dissenters...
If you haven't contacted your Senators' offices and Representative's office to tell them where Paulson should shove his plan, then consider yourself complicit in it.
I'm afraid the only way to make money is to short the dollar...
This doesn't matter how bad this plan is. The Neo-cons know that any opposition from the Dems. will be political sepuku so they come up with the most BS outlandish piece of crap imaginable. Knowing that it will pass and they (dems.) will be dealing with it for the next four years.
Brilliant strategy however we will all be paying for it no matter what your affiliations.
Ciao
MS
If it passes verbatim by monday. Maybe it really IS time to divest out of Any dollar denominated assets.
What, if it passes it may buy time or if it passes it may recommend to you divestiture?
I have been recommending moving some or all of their investments out of the dollar to anyone who'd listen since Greenspan started the Festival of the Damned after 9/11.
Open Left:: Yes, There Are Deeply Angry Democratic Members of Congress
"Paulsen and congressional Republicans, or the few that will actually vote for this (most will be unwilling to take responsibility for the consequences of their policies), have said that there can't be any "add ons," or addition provisions. Fuck that. I don't really want to trigger a world wide depression (that's not hyperbole, that's a distinct possibility), but I'm not voting for a blank check for $700 billion for those mother fuckers.
Nancy said she wanted to include the second "stimulus" package that the Bush Administration and congressional Republicans have blocked. I don't want to trade a $700 billion dollar giveaway to the most unsympathetic human beings on the planet for a few fucking bridges. I want reforms of the industry, and I want it to be as punitive as possible.
Henry Waxman has suggested corporate government reforms, including CEO compensation, as the price for this. Some members have publicly suggested allowing modification of mortgages in bankruptcy, and the House Judiciary Committee staff is also very interested in that. That's a real possibility.
We may strip out all the gives to industry in the predatory mortgage lending bill that the House passed last November, which hasn't budged in the Senate, and include that in the bill. There are other ideas on the table but they are going to be tough to work out before next week.
I also find myself drawn to provisions that would serve no useful purpose except to insult the industry, like requiring the CEOs, CFOs and the chair of the board of any entity that sells mortgage related securities to the Treasury Department to certify that they have completed an approved course in credit counseling. That is now required of consumers filing bankruptcy to make sure they feel properly humiliated for being head over heels in debt, although most lost control of their finances because of a serious illness in the family. That would just be petty and childish, and completely in character for me.
I'm open to other ideas, and I am looking for volunteers who want to hold the sons of bitches so I can beat the crap out of them."
I vote for Citizen.
I need to go sit in my tub and contemplate becoming Marat.
Revolutionary times call for revolutionary finance!!
Bah, give another bailout, and maybe the system will stabilize for another five minutes.
Someday this war's gonna end...
"Translation: Bush not longer needs Congressional authorization to appropriate funds."
There you go ... why even deal with Congress at all ... just give them fair warning with this, greatest of all trial balloons.
Brian writes:
How much is a trillion dollars? If you spent $1000 per minute, it would take roughly 2000 years to spend a trillion.
US debt is already 9.6T.
Safe currency ideas? Are there going to be any harbors in the wake of this disaster?
So, I was correct yesterday. We'll be bailing out German banks too. (as well as anyone else who wants to get in line)
Great.
Also would help if it's OK by energyecon if others can use the letter to send to elected officials - or if some of you can create good sample letters we can send and label them as such
(remember to send to state/local too -- they'll be stuck with bills when our tax money dries up and we need to foment outrage at that level)
And call, call, call - they can ignore an email or letter but it's harder to ignore a call
*
The bodies of the dead corporations lie in the gutters but wall street refuses to bury them.
Franz Pick and others saw this all coming.
*
So the country dies the day they knock down Yankee Stadium--kinda poetic--the end of an era.
"What may save us is the Dem's proposal to bail out homeowners. They will Christmas tree the thing, as they usually do and if we are really lucky, this will deteriorate into the usual partisan wrangling."
Another thing that may save us is that folks on the right are just as incensed as folks on the left. For different reasons. The conservatives see this as their big government worst nightmare and the liberals see this as their big business worst nightmare. Maybe they'll work together for once to save the country from this madness.
One question... why would they do this on the eve of the election, if they think they have a big chance of losing.
Either -
a) they are confident they will win
b) they think they can do a great deal of the bailout between now and January 22nd
c) they know the next Treasury secretary will have his hands tied to the bailout regardless
d) any favoritism under a democratic administration under this program will turn out to be the mother of all scandals and lead to republicans taking back control in 2012
Byzantine_Ruins writes:
Greenspan started the Festival of the Damned after 9/11.
Aptly put.
The Horror show continues.
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
and they will when the cost is the least. They won't even have to invade, just land an official jet and pronounce the fait accompli.
Volker the Viking | 09.21.08 - 11:59 am | #
You forget the other half of the equation - COST vs BENEFIT?
Why do it? Only when & if the Taiwanese make it an unavoidable issue - they haven't pushed it so no need. Their most recent gov'ts have gotten closer to the mainland & less confrontational. It will be an Anschluss between their gov't & PRC (people of Taiwan will have no real say)... it will only be war if the Taiwanese push it.
If the Taiwanese pull a 'Georgia'... vote in a proto-neocon puppet... only then will the PRC be forced to 'neutralize the threat'... lotta ways to do that too W/OUT firing a shot.
Do you realize how much investment there has been in the mainland from Taiwan? Threaten to nationalize it all & turn over to SOEs if the Taiwanese doesn't behave... it would blow a hole in their economy & tumble any militant confrontational gov't Taiwan votes in.
BTW - same thing will happen in Georgia - give it time. Lesson will be... if you want poverty and troops on your border then piss us off. Want to prosper and remain 'independent' then suck up to us... they'll get it.
Brian writes:
How much is a trillion dollars? If you spent $1000 per minute, it would take roughly 2000 years to spend a trillion.
US debt is already 9.6T.
BB | 09.21.08 - 12:04 pm | #
So, that's what, 20,000 years?
There's gotta be a creationist joke there somewhere....
capital flight anyone?
Commissar 4822 writes:
"They (the Red Brigade) had a reference document."
I guess watch for a new provision at 11:59 PM tonight providing for internment of dissenters...
Those provisions are already in place, as are the facilities n. But then, you knew that already.ecessary to transport intern them
Maybe they'll work together for once to save the country from this madness.
Hahahahahahahaha!
From the prior thread:
Here's one problem. While we're dissecting each element of every event taking place in the various bailouts, the average person is aware that there is some "sub-prime crisis" that is going on in other parts of the country and is more interested with the point spread of this weekend's game. Not one person in 100 knows or cares. Read it and weep:
Google Fight : Make a fight with googleFight index...=britney+spears
Now, Congressmen are trying to get another stimulus package out the door before the elections.
I feel like the turkey, the day before Thanksgiving. "Well, today looks a lot like yesterday, so everything must be fine. And tomorrow will be just like today. What's for dinner?"
pathetic
"Debtpocalypse writes:
If you haven't contacted your Senators' offices and Representative's office to tell them where Paulson should shove his plan, then consider yourself complicit in it."
I called yesterday, hope they listen.
I plan to call again to different offices.
If so inclined, also relate the possibility that this might be lauched as an Executive Order, sidestepping the Legislative Branch.
That might get their attention.
Then again...
Foreign banks of course means the foreign banks in the list of 17 banks he produced earlier this year:
BNP Paribas Securities Corp.
Bank of America Corporation
Barclays PLC
Citigroup Inc.
Credit Suisse Group
Daiwa Securities Group Inc.
Deutsche Bank Group AG
Allianz SE
Goldman, Sachs Group Inc
Royal Bank ADS RBS
HSBC Holdings PLC ADS
J. P. Morgan Chase & Co.
Lehman Brothers Holdings Inc.
Merrill Lynch & Co., Inc.
Mizuho Financial Group, Inc.
Morgan Stanley
UBS AG
Freddie Mac
Fannie Mae
Someone is taking over all the world's largest banks or putting them out of business. I wonder why?
"The result, pretty soon into the process, will be social breakdown and political upheaval. Every tatoo freak out there who has been prepping for his own starring role in some kind of comic book armageddon will finally get his chance to shine. Lots of people will get hurt and starve. Property will change hands in a disorderly way. And at the end of this process an American corn-pone Hitler may be waiting to set everything and everyone straight.
The markets open in about an hour. Good luck everyone."
A Kunster quote 7/14/08. Lets hope he's wrong.
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
Serf Nerdsky | 09.21.08 - 12:10 pm | #
We've only been begging for decent levees down here for 50 years. Maybe we should have renamed the city to the Bank of New Orleans so the gov't would take us seriously when we say we're "underwater"...
Thinking US Treasury might default??
Look at TBT and PST.
Note: I'm long TBT and turned a quick two-day profit on PST
Of course the SEC may outlaw shorting US treasuries soon enough
Perhaps this point has been made elsewhere, but keeping foreign investors placated seems to me what is driving this. Either we promise to buy this crap back from them or they put us under. It's that simple. So this little clarification surprises me not at all. And who can blame them -- this was allowed to happen. Tanta was the most eloquent Cassandra, but not the only one. Those in charge knew what she knew.
They've been very naughty.
I'm thinking to spread some holiday cheer
they get a visit from (Futurama's) Robot Santa this year.
For Immediate Release
Office of the Press Secretary
September 11, 2008
Executive Order: Executive Branch Responsibilities with Respect to Orders of Succession
By the authority vested in me as President by the Constitution and the laws of the United States of America, it is hereby ordered as follows:
Section 1. Policy. It is the policy of the Federal Government to ensure that each executive branch agency can perform its essential functions and remain an effectively functioning part of the Federal Government under all conditions. Accordingly, each agency shall take all appropriate actions to establish, maintain, and, as necessary, revise an order of succession, or to propose presidential action to establish or revise an order of succession...
Glasnost!
The unwinding of a system....let's try to keep this orderly, shall we?
Serf Nerdsky writes:
$1 trillion could build 20 $500 million dollar rail lines in each of the largest 100 metro areas of the U.S. Think of the construction jobs and redevelopment jobs and lessen the godforsaken dependence on foreign oil.
This appears to be a new transitista meme. The California High Speed Rail advocates are making similar claims. It isn't the capital costs, it is the ongoing massive subsidies to keep them running. If these new transit systems were to resemble the best of the current crop fares would have to quadruple to cover the current operating deficits.
Unfortunately, my house rep is Tancredo. Just hit his wbsite and there is no method available to send him an email !!!!
I always thought that if we were going to invade Iraq the inevitable course would be World War, it set a very bad example. Our first reaction to any crisis or any amount of fear or uncertainty would be the exportation of our violence.
EVERYBODY is finance saw this coming, don't kid yourself. The CEOs saw it coming but thought they could time it. I used to work at a specific investment bank that is no longer independent, and its chief economist was publishing article after article at the time trying to prove his point that there was a real estate bubble - in late 2004 and 2005. And everyone said no bubble, just froth. And he was insistent. That year that particular bank was the largest global underwriter of mortgage backed securities.
A Kunster quote 7/14/08. Lets hope he's wrong.
I will be happy to be the tattoo freak who mounts his head on the hood of my 74 Cadillac powered by rendered human fat.
Underneath I will write "COULD HAVE DEFEATED BRIGAND CHIH IF HE WAS INCLUSIONIST". What a dipshit. Good ideas wasted on an elitist mindset.
My 5 step plan fo fix the mess.
Step 1. Congress needs to demand the immediate resignation of Bush/Cheney/Paulson/Bernanke for malfeasance on the grandest of scales.
Step 2. Require that all level 3 assets be marked to reality and published immediately.
Step 3. Nationalize all insolvent companies that are deemed to big to fail.
Step 4. Begin criminal investigations of the senior staff of every nationalized company.
Step 5. Regulate all financial institutions with enough rules to prevent this from happening until we forget what happened.
Short the dollar
short Treasuries
long commodities
join underground economy
cut up credit cards
pull money from bank and buy toilet paper
only keep necessary checking account to pay bills with minimum funding
Fuck'em
WE NEED TO DROWN WASHINGTON DC IN CALLS LETTERS AND EMAILSS111111
...as new information about the proposed legislation was made known
i have called 2 senator's and one congressman's office 3 times each in two days
also written two emails to each demanding that the banksters NOT be bailed out.
I'm just making an example, the local Minnesota Republicans go absolutely ape-shit about spending $500 million dollars on a light rail line, but don't think twice about spending $1 trillion for reasons that aren't particularly clear.
Thoughts -- PUTs on TLT or long TBT ?
Shock Doctrine being applied to politicians in a bipartisan way.
The Master of puppets are pulling the strings.
Now. come on folks, won't the Chinese be paying for all of this, really? Ultimately? Where does all our cash come from anyway? We're just the middle man.
btw...anyone know the TED spread currently? Friday night it was 2.3 if memory serves....
"bearly writes:
Thoughts -- PUTs on TLT or long TBT ?"
Long GS... and short everything else
got both - prolly not enough - what rule change next?
does the american public really comprehend how much money was made on Wall Street over the course of the last 5-7 years off of these marked to fantasy financial products? J6P gets upset when they hear about the excesses of Enron, or a fired CEO getting a 42 million dollar golden parachute, but I dont think people really understand how much money was made by not just the CEOs, but the majority of people working on Wall Street over the past several years. Until people start seeing some figures on average salary in the firms we are about to bail out, this thing may get railroaded through.
We can only hope there's some shred of intelligence left in Congress to not pass this massive disaster, and that Bush tries to run the end-around with an executive order. At least that way, the Supreme Court could strike it down like the unconstitutional farce it would be, hopefully before every penny of ten future generations is gone.
Does anyone really expect that war will come from defaulting on our debt?
The Great Depression basically helped put Hitler in place and probably devolved into WW2.
Force hardship on other countries and expect retaliation of some form... I'm sure those Sovereign funds won't be cheering if they don't get their money back.
Not getting through. The Treasury will pay for this by issuing bonds to the Chinese who will fork over the cash needed.
Nick writes:
We can only hope there's some shred of intelligence left in Congress to not pass this massive disaster, and that Bush tries to run the end-around with an executive order. At least that way, the Supreme Court could strike it down like the unconstitutional farce it would be, hopefully before every penny of ten future generations is gone.
Nick | Homepage | 09.21.08 - 12:23 pm | #
When this Supreme Court is your best hope. you are in terrible shape.
Paulson's new title (he was being introduced as such by Brokaw on Meet the Press today is...wait for it...
THE MAN IN CHARGE
I kid you not
What we need is for a credible vocal opponent to emerge with a good alternative to this plan.
Escariot writes:
btw...anyone know the TED spread currently? Friday night it was 2.3 if memory serves....
Bloomberg.com:
Personal Finance
Is Paulson the One we've been waiting for?
Well, "bailing out foreign banks" is not going to be a big selling point politically, I suspect--even though the distinction between a "foreign bank" and a big Wall Street-based financial institution is hard to make in practical terms. Our banks invest over there; theirs invest over here, etc. It's like trying to buy an American-made car.
The more I think about it, this whole plan seems to be the ultimate exercise in trickle-down economics. We pour billions into institutions controlled by the rich and powerful -- the top of the pyramid-- and I am supposed to believe that at the end of the day, the company I work for will be able to issue commercial paper and meet payroll, my bank will extend my HELOC and my credit card company will raise my limit. Whoopee.
Those of you who are writing Congressmen might want to just ask them one single question: "How much is this plan going to raise my taxes?"
Has anyone given the taxpayer an estimate of that? Let's hear it. Let us know what we are going to be asked to pay, and then we'll decide if we're willing to take these risks that Paulsen talks about.
thanks BB (not at my office)
Anonymous wrote
short the dollar
short the....
etc etc and i agree
---DO YOU REALLY WANT TO F the system???
dont buy Nothin imported for Christmas ...
1/3rd of all retail yearly sales is around the holdays
most of the stuff on the shelves is from china etc..
fight back
This issue about bailing out foreign investors is a good segway into what the larger issue is . . . You should all read a special report the economist did in 2005 on world-wide real estate prices ( There is a copy of the report at The page cannot be found
The issue of overvalued real estate assets is a world wide phenomenon. And, anyone who has a clue as to how I-Banks work knows that they were marketing their garbage all over the world using world-wide assets. This is a huge, huge issue. The problem is global. The reason Paulson wants to refund foreign banks is he prays there can be coordinated efforts around the world as asset prices fall. This coordinated effort is a necessary (but not sufficient) condition to getting out of this mess. The probability of pulling this off is, in my opinion, just about zero percent.
There are a lot of ways to skin a cat. Chinese know this better than anyone
Yup. They could take over Canada for its resources... Wonder how much US would like that?
And people think I am bad... sheesh. When you sell your soul to me I keep my end of the bargain.. unlike your congress critters
There are no foreign banks. All big banks are global.
Dear Congressman King,
I am a lifelong ***** resident and former broker on Wall Street. I understand the seriousness of our financial situation and the need for action.
Please do not act too hastily.
If former Goldman Sachs President, Henry Paulson, is asking for unprecedented action to stem this crisis to the tune of 700 Billion Taxpayer Dollars, then please make sure commensurate pain is felt by the stockholders and executives of these firms.
I don't necessarily want anyone sent to jail but the people who orchestrated this mess should at least forfeit their 2007-08 Salaries (above $1 million dollars if you like to avoid hurting the average hardworking employee).
Given my past experience, many of my voting friends have been relying on my interpretation of these events. I hope I am not forced to speak negatively about your actions in this ongoing crisis.
Thank you for your time and continued(?) service,
Sincerely
Thomas ********
tbapple@yahoo.com
Address and Phone # redacted
Those of you who are writing Congressmen might want to just ask them one single question: "How much is this plan going to raise my taxes?"
Has anyone given the taxpayer an estimate of that? Let's hear it. Let us know what we are going to be asked to pay, and then we'll decide if we're willing to take these risks that Paulsen talks about.
Oh ye of little faith. There is a distinct possibility that we taxpayers may actually profit from this. It may actually decrease our taxes. Ha.
I just emailed both my senators and my congressman.
I also forwarded the contact info to everyone I could think of.
I am just beside myself how they are going to just hand our tax dollars over to the corporations.
Oh is the alternative so bad? Dammit I want to SEE IT!!!
Would you trust a contract with me or with an wall street critter.. I have more credibility..
at least i am not asking for the souls of your next few generations..
In 1989 it took 8 months for the DDR (East Germany) to disintegrate, implode, become a debris field.
What is the number of the most posts ever? 737 now on the thread below.
And he quits jan20.
a billionaire
This just gets worse and worse. CALL your congress creatures and tell them HELL NO!!!!!!
dont buy Nothin imported for Christmas ...
That's right. Give the kids fruits, nuts...or lumps of coal, as conditions require. All American-made.
I've thought up an improved name for TARP ...
The Splurge
comrade awgee writes:
This is not a sub-prime crisis, nor a mortgage or housing crises. This is a debt crisis brought on by a fractional reserve banking system using fiat currency. A "floor in the housing market" will not solve the problem.
YES!! YES!! YES!! YES!! YES!! YES!!
I don't think what we will be buying for Christmas is going to be an issue. Christmas will be cancelled, along with the election at the rate things are going...
lawyerliz are you txchick57?
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
In other words, he didn't have this plan in the works before middle of last week. Otherwise, he would have known to include foreign banks in the first draft. No?
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
You don't necessarily need to increase taxes. Hyper-inflation could do a fine job of diluting liabilites
Any incumbent who votes for this should be dead come voting time. A challenger should be able to say that "this so-and-so fiddled around while watching Rome burn, and then voted to have your grandchildren pay for their own incompetence." But my guess is that it won't matter and the same feckless idiots (both political and financial) will still be in power a year from now.
"Sept. 21 (Bloomberg) -- U.S. Senator Charles Schumer said the administration's $700 billion financial rescue plan ``needs changes'' to add mortgage aid for struggling homeowners and oversight of the government's intervention"
p.s.
"we all bankers now..."
you go to bed thinking this is madness just to wake up and realize, you haven't seen insanity yet!
Citizen John Stark writes:
dont buy Nothin imported for Christmas ...
That's right. Give the kids fruits, nuts...or lumps of coal, as conditions require. All American-made.
Citizen John Stark | 09.21.08 - 12:35 pm | #
oh come on let the kids have some lead painted toys and some melamine in their milk, its Christmas!
"lawyerliz are you txchick57?"
I doubt it...she doesn't talk about how much she made going long countrywide...bahahahaha
Please do not act too hastily.
Best comment I've read yet - from anyone.
Hang it out in light of day & let's see what we got. If it stands up to scrutiny - do it, if not do something different... maybe nothing if we can't agree or the alternatives are worse [there is always the bankruptcy courts - didn't congress just 'reform' them?]...
Rich:
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
I find it interesting they have repeatedly had to amend no-shorting orders to keep the market from imploding as a consequence of fiat policies. Not once but twice now. Very bad sign.
Pitchforks.
EVERYBODY is finance saw this coming, don't kid yourself. The CEOs saw it coming but thought they could time it. I used to work at a specific investment bank that is no longer independent, and its chief economist was publishing article after article at the time trying to prove his point that there was a real estate bubble - in late 2004 and 2005. And everyone said no bubble, just froth. And he was insistent. That year that particular bank was the largest global underwriter of mortgage backed securities.
Bond Girl | 09.21.08 - 12:16 pm | #
I was in a similar situation at an insurer, and was told there was no point in preparing for a breakdown of the financial system because if that happens we're screwed regardless.
Which wasn't an irrational response. But if even the industry whose raison d'etre is surviving catastrophe was on the "gotta keep dancing" meme, things were grim indeed.
Organize
To stop the Bush-Paulson Shock therapy
No more borrowing
The Democrats should demand an end to the foolish wars in Iraq and Afghanistan.
And another 200 billion or so haircut to the Military Industrial complex aka the Defense Department.
And special tax rates on the wealthy to help pay for this fiasco.
Put this program on paygo and let them scream
Somebody in congress should pull a Jimmy Stewart and talk for 5 days straight about the US Debt, maybe Bunning should buy some no doz.
Citizen john stark
Are you so bereft of ideas that you can't find Christmas gifts for you children, domestically made, beside coal and nuts?
Satan.
Nope. Don't use any handle other than lawyerliz.
By the way, maybe we should use your best slogan.
Non serviam. (servium?)
We will not serve.
We will not serve.
(Tell us, is Paulson the AntiChrist?
If so, maybe we can get Palin convinced and go after him.)
rich writes:
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
He would be persona non grata at the Polo Club on the Caymans... can't have that can we?
satan writes:
lawyerliz are you txchick57?
Not a chance. The Dawg knows these things.
rich writes:
The fact that Paulson didn't include foreign banks in his original draft but did include them in the fact sheet shows that he's gotten a few threatening foreign calls.
In other words, he didn't have this plan in the works before middle of last week. Otherwise, he would have known to include foreign banks in the first draft. No?
Making it up as he goes. Trying to grab as much authority as he can, as fast as he can.
rich | 09.21.08 - 12:37 pm | #
This an astute observation. They are clearly making this up as they along. This will end badly.
In 1989 it took 8 months for the DDR (East Germany) to disintegrate, implode, become a debris field.
Escariot | 09.21.08 - 12:34 pm | #
I spent a summer there in 1991 and the people still didn't know what had hit them. It took them longer than 8 months to catch on to the "lie, cheat and steal" global economy.
One thing I'll never forget is going to a bank with a local amateur jewelry-maker. I had asked him where he got his gold stock and couldn't believe his explanation, so I made him take me. Sure enough, at his local bank there were BAGS AND BAGS of 1930's St Gaudins $20 pieces. All the rare dates (which explains why they were the rare dates, I suppose). The bank sold them at spot but wouldn't let me choose the coins I got.
might as well let china dump their stuff also,,that is better that just giving their money back.
If I have to pay for this recapitalization, I want it to pay off. When SWFs and so forth injected capital, they did so on advantageous terms--Treasury, for example, is supposed to get 11 percent from AIG. As I recall, the people who pumped money into Citi got 8 percent or something like that.
So if me and my J6P buddies have to pay, just add a new deduction to the old pay stub. And give me my share of senior preferred shares in the First New International Bank.
We are all idiots. We know this isn't capitalism or democracy, yet we think the way to fight is to write a letter--or threaten not to vote for someone. Shit, find a ship and dump some tea.
With people like paulson, bernanke, wall street critters, congress critters and greedy "homeowners".. do you really require an anti-christ.. I mean, I could not have done a better job
Excellent move: include the foreign institutions. Of course they are right to do that when following the mad logic of this bailout.
But doing so will raise even more red flags and may be the undoing of the plan.
Gretchen as the perfect counter indicator was asking today who is benefitting from the AIG bailout and got UBS and other European banks on her radar benefitting from the gurantees on the morgages being honored. No, she is not righ. She just spotted a current bagholder - money was made on the receiving and middleman side. But her suspicion will be widely shared.
@ sickened:
For tens of thousands of IB employees who received several annual bonuses of 100K on up into the millions and then lost their jobs, as well as the millions who did not benefit, the corrupt path of credit expansion has reinforced the meaning of cutting hay while the sun shines.
Lawyerliz,
Now that will get some bowels in an uproar but I sure like the sentiment!
Been on the phone with family in four states, beating on them to write and call...win, lose or draw the plan is to go down swinging.
Aux armes
Citoyens
QiLai
Buyuan zuo nuli de ren min
Stop being slaves
"We are all idiots. We know this isn't capitalism or democracy, yet we think the way to fight is to write a letter--or threaten not to vote for someone. Shit, find a ship and dump some tea."
Amen.
[energyecon writes:
got both - prolly not enough - what rule change next?]
What strike on expiry on TLT. I don't have any but going for post election.
Thomas Jefferson wrote:
"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. It is it's natural manure."
I wonder how he would feel about the TARP bill?
really, people, the best response is just to drop out.
make as little income as you possibly can.
that's the only thing that will stop them - the reality of federal revenue in FRNs permanently dropping under 2 trillion.
Excellent take from Denninger:
The Mother Of All Frauds - The Market Ticker
I'm just amazed that the democrats are not questioning the price or the terms, but rather trying to decorate it like a christmas tree.
This is not a good sign, at all.
Is there nobody with a spine?
Please, Volkner, come up with something better. Please?
Well, if I wasn't hopping mad before I sure am now.
Let's take some words out of John McCain's mouth, out of context, and cast them in a more appropriate light. We need to "eliminate this burden on hardworking middle-class Americans." NOT the financial crisis, but the staggering load that is going to be placed on those very middle-class Americans in the form of future taxes and loss of a free market, with all the attendant societal "disruption" that implies.
This is a bailout of the financial elite, now including foreign individuals and entities, at the expense of Joe and Jill ... who have suffered enough. Wall Street needs to feel some serious pain at the executive comp and stockholders equity level for this to even stand a chance of flying in a free America.
The serial abrogation of fiscal and civic responsibility by the financial elite is the root of this problem, starting with Greenspan and trickling all over the place. It's now time for the financial elite to pay the price of their irresponsible binge.
Wall Street got drunk all right. Bush nailed that one. Now it's time for the hangover, and taxpayers are not the ones to suffer that ... or if they do, the pain needs be shared, in large portion, by the financial elite.
The provision that this bailout may not be reviewed by future Congresses or by the Courts moves us further in the direction of financial tyranny. I will vote against ANY incumbent, regardless of political affiliation, who supports this lipstick-less pig, and I urge my fellow citizens to do the same.
This plan needs serious revision NOW. Treasury better get their butts in gear coming up with something that is palatable to voters and taxpayers. Otherwise, kiss the U.S.A. goodbye. We will devolve into a kleptocracy, and will have as much legitimacy as the various puppet regimes around the world that Bush so regularly disposesses of the notion that they have any legitimate international standing. We will go begging when it is time to fund the doubling of next year's projected budget deficit - spending will be slashed everywhere but in the areas of defense and rescue of the financial elite. EVERYTHING ELSE will be under the gun, and society will suddenly find itself under very, very severe stress.
Treasury has not thought this rescue of the financial community through, that much is clear. I'm with Krugman on this one ... "no deal!"
Yup. They could take over Canada for its resources... Wonder how much US would like that?
D. | 09.21.08 - 12:29 pm | #
LOL - think again. [see my reference above to 'Geography more important than policy']
Canada need not ever 'fear' the Chinese... look at the map:
Siberia is to China what Canada is to the US.
Well, my co. has did away with their hiring bonus,,,and their starting package is now 33% lower than it was....oh-my,,,,