here's to the free market! Whoever said it last night, how a company like Lehman survived the Civil War, WWI, The Great Depression, WWII, the Cold War, etc. only to die under Dubya...
So if the Fed loans the money, and congress declines to approve, is this the mother of all pier loans? There's no way the Fed has a clear signal from congress this soon.
Does that mean the management of the place is going to be turned over to a bunch of SES & GS-15's? Is Don Rumsfeld still available for effing stuff up?
We need a serious claw-back clause...all moneys for the last N years distributed to senior managers in any form will be returned. No exceptions. Then we can think about "rescuing" their creation.
And if they are assetless, then recommend a couple different bridges they can move under.
WE THE PEOPLE and a few crooks too are at the mercy of the all/powerful OZ or the Federal Reserve central bank who were instrumental ironically in letting this financial derivatives demolitions meltdown the global eCON by being absent or AWOL...NO REGULATORY OVERSIGHT when the derivatives bombs were being planted...I THINK mISH IS RIGHT...FIRST THINGS FIRST...THE FED as controller of the monetary system and interest rates has to GO!
So is the Fed in the insurance business now? They're calling this a "bridge loan."
The Fed can make any loan against any collateral to anybody, using authority granted to them in the 1930s.
The devil here is in the details. What are the terms of the loan? What is the collateral?
I really do not see how they can help AIG with a loan secured by good collateral, unless the problem is a very short-term need for cash. And if it is secured by bad collateral, they are subjecting the central bank (read: currency) to real credit risk.
On CNBC they keep saying this great but it's wrong to wipe out the shareholders of a "viable" compay. If it's such a viable company then why is this such a problem. They need to stop sucking each other off on this one.
An inherent aspect of fascist economies was economic dirigisme, meaning an economy where the government exerts strong directive influence, and effectively controls production and allocation of resources.
In general, apart from the nationalizations of some industries, fascist economies were based on private property and private initiative, but these were contingent upon service to the state.
The least they could do is wipe out the stockholders. Completely. Teach 'em a lesson to invest in big monstrosities run by..dare I call them cr----...well I think I might tone that down to "reckless" people.., or should I keep that opinion to myself?
The crowd is chanting. they want it. give it to them!
USA!
AIG!
USA!
AIG!
FINISH THE DEAL!
YTL wants his second point. He's as hungry for that second point as conjure bag is for cheap thrills.
Why does the Fed tease me this way.
I know they want to do it
They know they want to do it
we all know they want to do it
(except for the extremely uninformed who have tried betting against YTL and his newly acquired feminine intuition)
In an extraordinary turn, the Federal Reserve agreed Tuesday night to take a nearly 80 percent stake in the troubled giant insurance company, the American International Group, in exchange for an $85 billion loan.
The Federal Reserve and Goldman Sachs and JPMorgan Chase had been trying to arrange a $75 billion loan for the company to stave off the financial crisis caused by complex debt securities and credit default swaps. The Federal Reserve stepped in after it became clear Tuesday afternoon that the banking consortium would not be able to complete the deal.
Without the help, A.I.G. was expected to be forced to file for bankruptcy protection.
The need for the loans became necessary after the major credit ratings agencies downgraded A.I.G. late Monday, a move that likely to have forced the company to turn over billions of dollars in collateral to its derivatives trading partners worsening its financial health.
Until this week, it would have been unthinkable for the Federal Reserve to bail out an insurance company, and A.I.G.s request for help from the Fed of just a few days ago was rebuffed.
But with the prospect of a giant bankruptcy looming one with unpredictable consequences for the world financial system the Fed abandoned precedent and agreed to let the money flow.
Warren Buffet will be more than happy to offer 20 cents on the dollar for all the subs put up for sale once the deal is complete. The good subs, that is.
Guess I wasn't seeing things when I dropped by the local coin merchant yesterday.
I think this crisis is not the end, and it will blow over.
We have a few years of calm to get it together before the next one, which will be much worse.
I can hardly wait to see when this stabilizes at the new levels.
One of the best things about this crisis is we have seared the bubble mentality into investors, every time something shoots up into the stratosphere it should be shorted, as it automatically is a bubble.
Until that last collapse, which will not be a bubble.
I'd go for a conservatorship. Wipe out common, claw back options and bonus fromtop execs and show them the door, a haircut for preferreds...the alternative is to be swamped with more bank failures thatn the FDIC can ever hope to resolve.
Is their no IB that can make a bridge loan? If not it's probably because AIG has no credit worthyness. I don't want to make this loan either! Who cares about warrants that are worthless!
This is just more moral hazard! AIG should have been selling assets months ago! They could also cut those freaking executive salaries which are way to freaking high!
Max writes:
The Fed is in the insurance business. Wow.
Max | Homepage | 09.16.08 - 7:31 pm | #
Somebody with almost as deep-a-pockets as Warren had to do it... who else but the Fed? Bill Gates? Hell then we'd have insurance that runs as well as Vista.
Until this week, it would have been unthinkable for the Federal Reserve to bail out an insurance company, and A.I.G.s request for help from the Fed of just a few days ago was rebuffed
c&c - I'm getting the stinking feeling this was nothing more that moving assets to different classes (as blue blood)
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
CapeColin writes:
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
CapeColin | Homepage | 09.16.08 - 7:39 pm | #
How do you think McCain will explain this? Of course he doesn't understand it at all, but he has to say something. Can he claim that his time in a Vietnamese prison equips him to fix it all? Maybe Palin has a nifty solution. Soccer Moms can fix almost anything and everything.
This morning I was trying to think up the craziest thing they could do. Something unbelievable.
I didn't come up with this. But I expected it even though my simple mind couldn't imagine it, and have been investing using a "truth stranger than fiction" strategery.
Give me some Yen and let's rally!
However, based on conversations on the street, with neighbors, and phone calls from relatives asking for advice, I'd say this is starting to make it into the mainstream awareness bubble. And people are WORRIED.
CapeColin writes:
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
As Donald Sutherland said to Kevin Costner in JFK: "You're a lot closer to the truth than you think."
Somebody with almost as deep-a-pockets as Warren had to do it
It's stunning how short-term the thinking has become. We're down to worrying about events within hours, not even days or weeks.
Sound, predictable policy cannot be created in such timeframes. Every decision appears arbitrary, and you'll exacerbate the problem whether you take action or not. Bailout AIG today, but what happens when the next crisis starts?
it to last in to next week.
Oil. Down down down.
Gold. who cares. if you think you need gold buy a
gun and loa
Wall Street crisis could put Fed rate cut in play- AP Big Risk:
Surging Debt Makes U.S. More Dependent on China, Russia, Gulf
States- Tech Ticker Dow Down 500: It Could Have Been Worse, but
'Crash' Risk Remains, Roubini
Time to tranche all of my unsecured subordinated debt and resell it to the Treasury clean up crew.
Oh wait, lookee here- I owe 30K to Cti, and 2k to Ba, and 24K to Crap1, and 10k to Chuse.
I guess I should just tell them I have decided to seek my bailout.
How about $42 boys?
Sounds about right to me;-}
Then I can restructure my secured debts-- ooohh lookie anothe Cit* for 500k- with a Chuse 65K heloc on top - now only good for a total of mebbie 410K-- can I haz a 3% rate too?
Got more! Howz bout my rental purchase in Jan 2007? Second wuz wid Fust Nattie Arizona which is now with Shiela B!! I gotz $100 for ya. Or I takz 2%.
Debt liquidation time- make me an offer and I might just send you some money!!!
it to last in to next week.
Oil. Down down down.
Gold. who cares. if you think you need gold buy a
gun and loa
Wall Street crisis could put Fed rate cut in play- AP Big Risk:
Surging Debt Makes U.S. More Dependent on China, Russia, Gulf
States- Tech Ticker Dow Down 500: It Could Have Been Worse, but
'Crash' Risk Remains, Roubini
LONDON, Sept 16 (Reuters) - The sense of crisis engulfing interbank money markets deepened on Tuesday as the cost of borrowing overnight dollars surged above 10 percent, indicating that money markets had frozen and counterparty trust broken down completely.
California Gov. Arnold Schwarzenegger says he will veto a state budget passed after a 78-day stalemate, setting up a historic showdown with the Legislature.
As the San Francisco Chronicle explains, the proposed budget sought to close a $17 billion deficit for the fiscal year that began July 1 without new taxes, a demand by Republicans. It did so by requiring all taxpayers to make earlier and larger tax payments to the state government.
Schwarzenegger, a Republican, made the announcement this afternoon. The veto will mark the first time in modern history that a California governor has rejected a veto a state spending plan. The Democrat-controlled Legislature has said it is prepared to override a veto.
Yesterday, about 12 hours before the last vote was taken at 2 a.m. today, the governor sent Assembly and Senate leaders a letter threatening the veto
"I have been very clear this entire year that I would be unable to sign a budget without meaningful budget reform," the governor wrote, stressing that spending cuts were needed.
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
\tTuition assistance, free in house management, free vocational training, free self defense courses, highly competitive compensation, bonuses and advancement opportunities?
\tCorporate sponsorship for employees to compete in regional and national athletic competitions?
\tForested jogging tracks, open air swimming areas, biking trails, an indoor cardio training center and a weight training center?
\tWeight management education, smoking cessation assistance and company provided basic family medical support?
\tCorporate sponsored employee car pooling, on campus wind power generation, bio-diesel vehicle design and development, bio-diesel power plant design and development and an ecological friendly 7,000 acre campus?
\tEmployee driven charitable community outreach programs, employee driven national and international humanitarian support programs?
\tAnd yes - Free lunch every day?
.
Too good to be true? Well there is a company that provides all this and much more - we are Blackwater Worldwide.
"80% share? Does that require share holder approval?"
Technically, maybe. But I didn't see the shareholders offering to buy the warrants... Shareholders are toast if those warrants exercise, but then they might come out ahead of where they would have been in a BK. If I has shares in AIG I would shut up and say "thank you, sir". An 80% haircut is better than a BK.
This loan will be senior to common and preferred. If the 'loan' is not paid back in full, the equity (common and preferred) is wiped out.
Of course, this is also functionally equivalent to a senior equity injection, which shows the how unlimited the Fed's powers really are. "Debt" and "equity" are just labels slapped on instruments. A good lawyer can write what is basically an "equity" investment with loan documents (like a participating subordinated loan or a thinly collateralized loan with warrants like what the Fed is doing) or write what is basically a "debt" investment with equity documents (a joint venture agreement where the money provider gets all its "equity" back plus a preferred return prior to any other distributions (and you could also include a guarantee)). Saying the Fed can "only" make collateralized loans is really meaningless. It can make any investment it wants and just slap a "loan" label on it.
"Does this mean I can cancel my car insurance since we have socailized auto insurance?"
Yes, but the paper work all has to be done in tripliket on an IBM selectric and mimeographed, sent snail mail to USAIG. You may get a response back in 5-6 years, asking you to correct a trivial error and resubmit.
The only problem the talking heads see is mark to market accounting. They think it is the accounting is the problem, and all the financial firms that are going under are actually solvent. This is drving me crazy.
Saying the Fed can "only" make collateralized loans is really meaningless. It can make any investment it wants and just slap a "loan" label on it.
Anonymous | 09.16.08 - 7:52 pm | #
I for one am looking forward to the next 8 years when Sarah Palin gets to tell me what business I can run, what clothes I can where, what doctor I can go to and whether my new girlfriend gets to take birth control or not (since McCain's only got 2 years left in him).
People who want more government involvement in their lives better watch what they ask for.
I emailed my senator this:
(I think it's cute, but I may end up going to Guantanamo Bay due to the last paragraph)
==
(I sent this to the MN Senator):
I know you will never read this message. I know I'll get the standard "thank you for your concern" letter back from you by email. But for some reason I just thought I'd write. I guess it's cathartic.
If you haven't noticed, we seem to be bailing out an awful lot of very rich people lately. Fannie and Freddie, AIG, Bear Stearns. This is costing us BILLIONS AND BILLIONS of dollars. Why don't we as a people have a say in this?
I find you to be an honest and responsible senator, but unfortunately financially illiterate. That's ok, we all have our strengths. But maybe you could try learning some of this stuff so that we have a say? Not from the Wall Streeters though... maybe from somebody at Carleton's or Macalester's department of economics.
Recently, AIG REFUSED an offer to be bought out by private parties, and then blackmailed the Federal Government into bailing it out. Interestingly, I note THAT THEY ARE NOT EVEN AN AMERICAN COMPANY since they conveniently relocated to the Caribbean to avoid taxation. Maybe you could use that as political capital?
How many more FOREIGN companies will we bail out to allow the rich CEOs to have golden parachutes? how many more times do we have to watch as billionaires are bailed out of their bad investments? Just wondering.
sorry for how poorly this is written. I really am at wit's end.
Oh: by the way: the next bailouts on the table are Washington Mutual and Wachovia Bank. we won't talk about Ford and GM and Chrysler or the airlines for now.
Lastly: could you at least steer some bailout money to Minnesota? why must all the bailouts go to California and New York?
lastly: al qaeda. Al Qaeda has nothing to do with this, but I'm sure al qaeda in a message pops some sort of anti-terror program that will make somebody actually read this email instead of just bouncing it back as an automated message. Might as well give them a chuckle at the plight of regular non-bailed out Americans.
It's not really our tax dollars.
We owe about 10 Trillion, right? (By the time you read this, it may be much higher.)
And we aren't paying it down at all yet. Hell, we're still running the tab.
So how long until our tax dollars dip 10T into the debt? Unless you make radzillions of dollars a year or plan on living to 300, your tax dollars are probably safe.
Of course, there is no intention of ever paying it off. They're going to run this up and burn it down. This is the end of America.
Bernanke and Pauson will do whatever it takes to hold this rickety financial system together until after the election. The it will be up to McCain and Mooselini to straighten things out...holy shit!
The US of A is a democracy. There are elections every two years. The majority of incumbents are re-elected, every single time. What is happening now is a direct consequence of people most assuredly having "a say in this".
Bread and circuses, we were warned a long long time ago.
The fact is, the free market doesn't work for life insurance. 100 people need to provide for their families, and they figure that probably 2 of them will die this year. They don't mind sharing the costs, but they need to know the payout is 100% certain.
It is absolutely absurd to assume that they have the resources to evaluate the long term financial health of even an established giant like AIG. Management has every incentive to overpay themselves and make risky bets because they are protected by bankruptcy law, and the problems are unlikely to surface except in a "once in a lifetime" credit crisis.
So the efficient solution is a not--for profit quasi-governmental agency to handle all life insurance, like social security, as distasteful as that sounds.
However, I am for letting AIG fail and starting up such an agency from scratch.
collateral for the loan? bill gross' old boxers. bunch of commies, i had more faith in you to do the right thing mr. paulson, but i was deluded to think bear was a one-off event cuz you were a dear caught in the headlights. sad sad sad.
thanks for the best laugh I've had all day. Superb...
thanks for the compliment. although I really did send it to my senator (no joke) so if none of you hear from me in the future I'll probably be detained.
Besides: the letter was my way of "giving back" after trouncing everybody with my predictions today. I just wanted to keep it real, ya know. gotta stay with my peeps.
I'm still confused, I thought when Bear got bailed that was supposed to prevent others from going other, they weren't lying to me again, where they?
Oh wait, that was F&F getting bailed that was supposed to prevent all this...I suppose AIG will be the one to prevent all this...Am I the only one that has figured out, NOTHING is going to prevent all this?
It's in my play book. So is building a super cape that makes me fly. Last test on the latter was slightly painful. But I think I actually caught some air.
By Conor Humphries in Moscow
September 17, 2008 12:13am
RUSSIA'S main stock market suspended trading today after plummeting more than 11 per cent, having lost more than half its value since May, as failing Wall Street banks caused panic on global markets.
The benchmark RTS index halted trade after a fall of 11.47 left it 54 per cent below its record close on May 19. The ruble-denominated Micex was also suspended for an hour after dropping 16.6 per cent.
"Panic has gripped the Russian stock market," read a headline on the Interfax news agency.
Those hardest hit on the RTS were energy companies, with state-controlled gas giant Gazprom falling 17.2 per cent and oil firm Rosneft losing 19.12 per cent.
"The turmoil on Wall Street and worries about fall in the oil price are keeping buyers away despite the cheap prices," said analyst Chris Weafer in a note from Moscow-based investment bank Uralsib.
"The only feeling is one of numbness, shock," he said. "The hope is that this is the final clear-out, that this week we will find a floor."
It wasn't Paulson (Treasury), it was Bernanke (Federal Reserve). From everything I've read, Paulson wanted them to take their medicine and deal with bankruptcy.
Thank goodness we still don't have the totalitarian nightmare of government health insurance.
That, my friends, would be socialism!
We have a government that can't even manage it's own finances or manage to turn anything remotely approaching a profit. I wonder what kind of disaster they'd make out of health care.
I suspect it would end up looking a whole lot like housing does today.
ZDNet having published a report stating that a group made up of, amongst others, the UN, the US government and the Chinese government, is drafting a series of technical standards to define methods of tracing the source of internet postings and curbing the ability of web users to remain anonymous.
Thanks Alan, I always thought you were a hottie, you should dump Andrea...
I love finding you guys BTW, I used to trade with a great bunch of people on an IPO board back in the boom times of the tech bubble...You all remind me of them. Heck, some of you might even be some of them...We had a dryflydrift on that board.
Spread the word -- instead of waiting for our next "stimulus" check, let's have every American skip their credit-card and mortgage payments in October & November.
Fed Readies A.I.G. Loan of $85 Billion for an 80% Stake
The Federal Reserve was close to a deal Tuesday night to take
a nearly 80 percent stake in the troubled giant insurance
company, the American International Group, in exchange for an
$85 billion loan, according to people briefed on the
negotiations.
An earlier news alert, overstating the progress of the talks,
incorrectly reported that a deal had been completed.
"Besides: the letter was my way of "giving back" after trouncing everybody with my predictions today. I just wanted to keep it real, ya know. gotta stay with my peeps.
I feel like a little humor is needed today."
Dear Babs and Diane,
Hi. Umm...do you think you could get off your friggin' asses and take a look at this AIG thing?
Can you imagine a 300 year old vagina? Still wanna live it out?
You're ignoring, too, the effects of shrinkage on your [i]own[/i] body. By age 300, what you've got left is little more than a pair of raisins and a grape.
Wondered today about whether there might be a "loan" a la Chrysler in 1980; but figured that it wouldn't happen since that took an act of Congress as I recollect.
This would be happening too fast for that. And the senior execs are patting themselves on their backs for their brinksmanship.
My only consolation is, can we the people fire these hacks?
Hell, I'll come back and run the damned thing at a GS level. Take it back to an insurance company and unwind it...quickly.
wally writes:
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
Why? People keep saying this over and over, about every single large company that gets close to the edge, but why is it true? Large insurance companies have collapsed before, without triggering major bank failures. Reliance, Kemper, hell all of Lloyd's was on the verge of a collapse and although it was understood that it was bad news I don't remember anybody suggesting it would destroy the world's financial system.
Mike:
of course you (and anybody else) can use my little letter. I'll need company in Guantanamo.
Dryfly:
I sent it off to Mr. Franken as well.
Comrade Misean:
Here's your tinfoil hat back. I can't use it any longer.
as per our agreement, here's the certified life/car/home insurance policy from AIG paid for with my WaMu check, so that your children can sleep well at night.
Oy again with the communism. This isn't a red 'overthrow' of private companies for some mythical mass benefit, it's corrupt, failed businesses begging the govt to take out their garbage.
And the lapdog gov't obliging. It's not some glorious revolution if someone points a gun at you and says 'take this ebola patient off my hands or I'll shoot him and you.'
What Bennie doesn't get is that eventually all three of you wind up dead.
Lets look on the bright side, once WAMU and the FDIC go down on Thursday, Bernanke and Pualson can take a weekend off for once...we all know they aren't paid enough to be working 7 days a week after all.
You know Congress can impeach members of the Cabinet. It's happened once before. William Belknap, secretary of war under president Ulysses S. Grant.
Belknap had profited from kickbacks by military contractors. The House began impeachment proceedings, documented the charges, and just before the articles were formally voted, on March 2, 1876, Belknap resigned.
crude oil futures going parabolic up 3% AH. euro/usd up to 1.42 (means dollar weakening. gold futures up 0.31%. energy stocks PBR, SU, XLE and GDX, EWZ all up AH.
Perhaps a blizzard of faxes might at least get somebody's attention. I dialed the phone number and got an automated phone system that said "Press 1 if you know the name of the person you wish to contact." I was reaaaally tempted to say "Bernanke" but chickened out.
OK, so AIG turned down private investors because they did not want to lose control of the company, but somehow they will take a loan from the Fed and... lose control of the company? Makes sense to me....
NEW YORK (MarketWatch) -- One of the first and largest money market funds has put a seven-day freeze on investor redemptions after the net asset value of its shares fell below $1, in a rare instance in the fund industry of what is called "breaking the buck." Primary Fund (RFIXX:
a $64 billion fund managed by money market fund inventor The Reserve, said late Tuesday that its $785 million holding of Lehman Brothers Holdings debt has been valued at zero.
http://www.marketwatch.com/news/story/money-market-fund-breaks-buck/story.aspx?guid={56A2CEE5-5A53-4A27-A4BA-585CFBE173A4}
"let's have every American skip their credit-card and mortgage payments in October & November."
I'm in. Who's with us? Um...hey...turn off those TV's!! We are in trouble here! If we all stick together, we have power! Think of your children...sigh. Maybe next time. Maybe your kids will answer the wake up call.
Back to my zen mantra "republicans are fiscal conservatives, republicans are fiscal conservatives, before heading the treasury Bernake was Bush's top economic advisory, there is no such thing as a fiscal conservative"
In the next couple weeks Americans will wake up to the fact their country is being taken from them.
I'm afraid that to complete this power takeover the PTB will have to create a distraction like a large war event to cower the uppity.
It seems that the multitude of studies of the effect of sleep deprivation on decision-making would be relevant to the Federal government right about now.
GS-13 clerks are now determining who can own a home.
GS-13 clerks are deciding what interest rates should be.
With AIG GS-13 clerks will determine whose life policy is paid, whose pension plan is supported and who can buy fire and auto coverage.
I like it - it's good to be a GS-13.
So much for the GOP bullshit about letting the economy pick winners and losers. How about all that "creative deatruction" free market b.s. Kudlow et al spout all the time. Tonight he was a mute and just LOVED the government. What a bunch of scumbags. Of course, they will spin it that they did it for the "little guy". What a farce this country has become.
I'm no expert but this looks like a leveraged buy-out, except that AIG's shareholders don't get bought out and are replaced by the Fed's shareholders. Who are? That's not rhetorical--I have no idea. Does each Fed Bank have its own shareholders.
Every now and then a business letter transcends the genre. Mr. Hank Greenberg writing to Mr. Bob Willumstad. (per CRs link)
Since you became Chairman of AIG, you and the Board have presided over the virtual destruction of shareholder value built up over 35 years. It is not my intention to try to point fingers or be critical.
wally writes:
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
We've been using that same excuse since 1998.
Apparently we're going to keep using it until the US government fails.
You can't bail anybody and everybody out; it will simply bankrupt the taxpayer.
Was it Einstein who said insanity is doing the same thing over and over again and expecting different results?
I have been through all this before in Soviet Russia. What you have here is looting of the country by the elite. Soon they wire their money to Switzerland and retire in countries with little known names.
All this talk of Armageddon is simply a way to force the Fed to give out money. There would be no Armageddon, of course. We were promised Armageddon after Lehman BK, and all we got was a giant nothingburger. Great Depression saw companies go BK left and right, and we still pulled through just fine. I think the social safety net is much more developed today than in 1929, so why do we keep screaming 'end of the world'? Only to make it easier to loot you, gentlemen.
So what is the future of AIG after this? Will the Fed just guide them through this tough time and then let them go, a kind of catch and release thing? Or will they essentially go into run-off? Surely this is a temporary thing, whatever it is?
Barclays will buy the U.S. investment bank and capital-markets businesses of Lehman. As many as 9,000 Lehman employees will find jobs with the U.K. bank.
For everyone worried about insolvency, debt, and higher taxes, the next fix is being worked on right now:
CHANGE THE ACCOUNTING RULES*
*Fine print: only applicable to large, highly-leveraged companies, hellbent on losing tons of money.
This isn't over. When they bailout the consumer (retailers, mortgage, credit cards), then we're at the bottom. We're just doing the business thing right now.
And that's only 30% of the economy. The "robust" consumer is everything.
Bailouts and accounting rule changes en route soon.
Lots of GS-13 to 15 positions. Lot of GS-11 which is pretty good for flyover land.
Except what agency? This is the lean part of the year for gov agencies. Budgets are pretty much gone. Oh, Special Allocation. Yet you can't get one of thoses in a week.
So basically AIG runs in place. No FDIC like team available for deployment.
They really made this up as they went along. There is no real plan here. After it is announced they are going to be clueless.
CapeColin writes:
In the next couple weeks Americans will wake up to the fact their country is being taken from them.
Unless they let us keep our houses, our Wii, our Comcast cable and the right to eat out at restaurants five times per week on our overmaxed credit cards.
"We have a government that can't even manage it's own finances or manage to turn anything remotely approaching a profit. I wonder what kind of disaster they'd make out of health care."
well consider who has been running the government for the past 30 years. conservatives who wish to drown our govt in a bathtub. right wingers who say govt can't solve our problems and then proceed to prove it.
didn't bill clinton say that during his admin. he didn't have full control of the government. that there was an entrenched interest in many parts of the govt that kneel to the invisible hand of the market and Reagan's ass?
i wonder how things would be if our govt wasn't controlled by these nutjobs. maybe the dems can pull off a recovery but we all know it is going to get worse before it gets better. seems to me canada is doing okay and they have a great healthcare program. if the free market types get their way, then govt healthcare would be a massive subsidy of the healthcare industry, not a national healthcare system like canada.
Re retiring to small countries with little known names. My fantasies of revenge hover around insolvent governments withdrawing military protection from satellite nations. Either these rich goons start funding their own armies, or they are subject to banditry and expropriation of their ill gotten gains. Could happen.
OK, in this week the Fed has loaned/spent or promised to:
50 billion for the expanded swap facility
70 billion repo supplement to hold the FF rate
87 billion to JPM to back up their bridge loans to Lehman
85 billion bridge loan to AIG
CSC: Unless you have a VERY active bedroom life you're already spending more time here anyway. So if the women don't appeal to you at 300, you can always just post here instead!
I love sex but there are many other things I'd happily live to 300 doing.
Definitely el-fired.
isn't nemo first?
Third?
Building a bridge paved with good intentions.
Fed negotiating roughly $85-$90 billion secured bridge loan for AIG, bailout plan "isn't a conservatorship"
That's a lot of dough rewarding failure.
here's to the free market! Whoever said it last night, how a company like Lehman survived the Civil War, WWI, The Great Depression, WWII, the Cold War, etc. only to die under Dubya...
To the end of an empire. The binge is over!
Yes. The US government is now a hedge fund. A hedge fund with unlimited taxing authority.
what took my bitches so long!
I'll repeat:
So if the Fed loans the money, and congress declines to approve, is this the mother of all pier loans? There's no way the Fed has a clear signal from congress this soon.
Bridge to Somewhere?
The Fed requires no approval from Congress.
This time they really have gone too far.
AIG just hired law firm to declare bankruptcy.
CR,
Its a good think you're retired!
.....
The Fed requires no approval from Congress.
So is the Fed in the insurance business now? They're calling this a "bridge loan."
Yahoo showing 1.2 BILLION shares traded today....is this a misprint?
gotta love that free market capitalism. Wonder if taxpayers will be footing the bill for year end bonuses too?
Chavez seen entering back door of whitehouse suspicions he has been retained as special advisor on economic policy.
Paulson has no stones to do what is right for the long term future of the economy. . The guy is completely worthless. Fliiipp floooop.
Does that mean the management of the place is going to be turned over to a bunch of SES & GS-15's? Is Don Rumsfeld still available for effing stuff up?
If this isn't criminal, it should be.
AIG just said they were "well capitalized" and " operating normally" - WTF??? Someone is lying!
Soft Landing.
Contained.
Any of these terms ring a bell
Yahoo showing 1.2 BILLION shares traded today....is this a misprint?
We need a serious claw-back clause...all moneys for the last N years distributed to senior managers in any form will be returned. No exceptions. Then we can think about "rescuing" their creation.
And if they are assetless, then recommend a couple different bridges they can move under.
atta boy George!
You are now officially the greatest Communist who ever lived
WE THE PEOPLE and a few crooks too are at the mercy of the all/powerful OZ or the Federal Reserve central bank who were instrumental ironically in letting this financial derivatives demolitions meltdown the global eCON by being absent or AWOL...NO REGULATORY OVERSIGHT when the derivatives bombs were being planted...I THINK mISH IS RIGHT...FIRST THINGS FIRST...THE FED as controller of the monetary system and interest rates has to GO!
JS,
I'm still waiting for my recovery in the second half of '08!!!!
LOL!!!!!
.......
Carlo, not a misprint.
Max --
So is the Fed in the insurance business now? They're calling this a "bridge loan."
The Fed can make any loan against any collateral to anybody, using authority granted to them in the 1930s.
The devil here is in the details. What are the terms of the loan? What is the collateral?
I really do not see how they can help AIG with a loan secured by good collateral, unless the problem is a very short-term need for cash. And if it is secured by bad collateral, they are subjecting the central bank (read: currency) to real credit risk.
We need details.
Wait BB and Hany P said this was all contained...then it was only $100 billion...then it will be over in months...then...
in capitalist russia, stock markets crash.
in soviet america, stock markets crash you.
cnbc reporting 90 bil bridge loan from fed, gets equity in aig. sounds like fannie freddie, but this isn't an implicity backed agency...why?
I know, was answering someone else & mistyped.
AIG just said they were "well capitalized" and " operating normally" - WTF??? Someone is lying!
crispy&cole
That was last week, ask Thain the meaning of well-capitalized.
Sources put the size of the loan at $85 billion to $90 billion, adding that it will be secured and include incentives for quick asset-sales by AIG.
Sounds like at least a partial liquidation to me. Why do we need the Fed for this, exactly?
Didn't they always say these "neo-cons" were "former" Communists?
Common, preferred and all other equtiy/debt better get wiped out or I am gonna be pissed!
i think it allows the subsidiaries, which are guaranteeing the debt, to sell themselves
On CNBC they keep saying this great but it's wrong to wipe out the shareholders of a "viable" compay. If it's such a viable company then why is this such a problem. They need to stop sucking each other off on this one.
I have found my raison detre:
'Carpe Diem,' Says Man Who Spent Previous Day Masturbating In Darkened Room | The Onion - America's Finest News Source
unfortunately, at my advanced age, I may have to limit myself to my current realities
An inherent aspect of fascist economies was economic dirigisme, meaning an economy where the government exerts strong directive influence, and effectively controls production and allocation of resources.
In general, apart from the nationalizations of some industries, fascist economies were based on private property and private initiative, but these were contingent upon service to the state.
Economics of Fascism
The least they could do is wipe out the stockholders. Completely. Teach 'em a lesson to invest in big monstrosities run by..dare I call them cr----...well I think I might tone that down to "reckless" people.., or should I keep that opinion to myself?
FINISH THE DEAL.
USA
AIG
USA
AIG
FINISH THE DEAL
The crowd is chanting. they want it. give it to them!
USA!
AIG!
USA!
AIG!
FINISH THE DEAL!
YTL wants his second point. He's as hungry for that second point as conjure bag is for cheap thrills.
Why does the Fed tease me this way.
I know they want to do it
They know they want to do it
we all know they want to do it
(except for the extremely uninformed who have tried betting against YTL and his newly acquired feminine intuition)
NY Times says:
Fed to Give A.I.G. $85 Billion Loan and Take 80% Stake
AIG stock is not reacting.
AIG down big AH...
and include incentives for quick asset-sales by AIG.
Yea thats the way to get a fair value for an asset, sell it quickly...
......
New dow component:
fanfredaigwamu - ticker "USA"
No dividends. Stock price 1 dollar
Shorting and options disallowed.
Bail Baby Bail?
Who gets the 20% that's left? How do they divy that up?
S&P futures like the news.
So the Federal Reserve is going to own 80% of AIG??
Mmmm... kay...
ow at 1.98 ah....timber.....
The Fed is in the insurance business. Wow.
FED IN AN $85 BILLION RESCUE OF AN INSURER NEAR FAILURE - NY Times
Too little, way too late. The deal isn't viable. It can't work. AIG will tank.
BBG TV confirms $85b
They had better hose the preferreds.
Zero!!! Nada!!! Nothing!!!
That 20% (dont know where its going either) really irks me at this point.
.....
In an extraordinary turn, the Federal Reserve agreed Tuesday night to take a nearly 80 percent stake in the troubled giant insurance company, the American International Group, in exchange for an $85 billion loan.
The Federal Reserve and Goldman Sachs and JPMorgan Chase had been trying to arrange a $75 billion loan for the company to stave off the financial crisis caused by complex debt securities and credit default swaps. The Federal Reserve stepped in after it became clear Tuesday afternoon that the banking consortium would not be able to complete the deal.
Without the help, A.I.G. was expected to be forced to file for bankruptcy protection.
The need for the loans became necessary after the major credit ratings agencies downgraded A.I.G. late Monday, a move that likely to have forced the company to turn over billions of dollars in collateral to its derivatives trading partners worsening its financial health.
Until this week, it would have been unthinkable for the Federal Reserve to bail out an insurance company, and A.I.G.s request for help from the Fed of just a few days ago was rebuffed.
But with the prospect of a giant bankruptcy looming one with unpredictable consequences for the world financial system the Fed abandoned precedent and agreed to let the money flow.
Warren Buffet will be more than happy to offer 20 cents on the dollar for all the subs put up for sale once the deal is complete. The good subs, that is.
Milkman writes:
Too little, way too late. The deal isn't viable. It can't work. AIG will tank.
.......
Of course it will tank. The shareholders dont own it any more, you and I do.
.....
Call me crazy, but doesn't there come a point where J6P looks at these bailouts and goes "WTF??? What are you dudes doing with my tax dollars?"
When do the sheeple realize they are being robbed blind?
Repost:
Thin market update:
JRun Servlet Error ArticleId=5313
Guess I wasn't seeing things when I dropped by the local coin merchant yesterday.
I think this crisis is not the end, and it will blow over.
We have a few years of calm to get it together before the next one, which will be much worse.
I can hardly wait to see when this stabilizes at the new levels.
One of the best things about this crisis is we have seared the bubble mentality into investors, every time something shoots up into the stratosphere it should be shorted, as it automatically is a bubble.
Until that last collapse, which will not be a bubble.
Someday this war's gonna end...
Aren't they overpaying just a tad?
/sarcasm
fanfredaigwamu - ticker "USA"
classic.
Is the deal signed?
CONSUMATE THE DEAL! YES YES!!!
You know... sometimes people just need to be given permission for whatever it is they're going to do.
Psst... Fed/Treasury: you can do it. it's ok. shhhh....
Another bridge-to-elections loan?
I'd go for a conservatorship. Wipe out common, claw back options and bonus fromtop execs and show them the door, a haircut for preferreds...the alternative is to be swamped with more bank failures thatn the FDIC can ever hope to resolve.
bill gross writes:
what took my bitches so long!
bill gross | 09.16.08 - 7:22 pm | #
LOL!!!
I was thinking the same thing - somewhere there is a bond guy smiling.
No 80% crap, either... 100% all the way.
Is their no IB that can make a bridge loan? If not it's probably because AIG has no credit worthyness. I don't want to make this loan either! Who cares about warrants that are worthless!
This is just more moral hazard! AIG should have been selling assets months ago! They could also cut those freaking executive salaries which are way to freaking high!
Palin knows a lot about bridges to nowhere. Maybe she should handle this.
There's no way the Fed has a clear signal from congress this soon.
Congress? Who's that?
J6P just made me whole!
Thanks dude
YES YES YES YES!!!!
IN YOUR FACE!
The final score
YTL: 2
people arguing with YTL: 0
funny... it's somewhat of a hollow victory. I can't quite figure out why.
Thanks dad!
kevin de bruxelles writes:
NY Times says:
Fed to Give A.I.G. $85 Billion Loan and Take 80% Stake
THAT MY folks would be nationalization! Ruskie style!
I hope this is NOT true.
Moral
Hazard
Owns
You
can someone more knowledgeable help me with this analogy, i'm trying to finish a crossword puzzle
BSC is to LEH as AIG is to ???
When do the sheeple realize they are being robbed blind?
Maybe when they get over their infatuation with Palin and mediocrity. Not in the near future, for sure. Why do you think they are sheeple?
funny... it's somewhat of a hollow victory. I can't quite figure out why.
I feel the same and I didnt even win anything...
Its been a depressing week
....
Fed to Give A.I.G. $85 Billion Loan and Take 80% Stake
This is an effing load of feces.
I'm mailing all my outstanding bills to Uncle Sam.
Hey YTL,
when you gonna take your markdown on those Lehman subs we tranched you in on monday morning- after all you were still doing deals;-P
Guest on Kudlow just said, "It's not fair for the government to force AIG into BK, just because they need a little bridge loan."
This world is not my home.
Bernanke blinked so Paulson didn't have to?
Max writes:
The Fed is in the insurance business. Wow.
Max | Homepage | 09.16.08 - 7:31 pm | #
Somebody with almost as deep-a-pockets as Warren had to do it... who else but the Fed? Bill Gates? Hell then we'd have insurance that runs as well as Vista.
Keeping Their Powder Dry: Draft Boards Hang On, Just in Case - WSJ.com
A reminder, the only thing that has ever fixed an economy like this in the past has been a war.
The tree of freemarket has to be fertilized at times with the blood of patriots. It's times like these they were talking about.
Until this week, it would have been unthinkable for the Federal Reserve to bail out an insurance company, and A.I.G.s request for help from the Fed of just a few days ago was rebuffed
c&c - I'm getting the stinking feeling this was nothing more that moving assets to different classes (as blue blood)
tinfoil hat off!!
who the f' does Paulson think he is spending my money this way. It's my f'ng money. I demand an investigation.
jim writes:
When do the sheeple realize they are being robbed blind?
God loves sheeple ...
That's why he made so many of them ...
It is hard to keep up with this post it is moving so fast. I own 80% of AIG. Right on. Can't wait to start getting my dividend checks.
Historians will make future children study Sept. 16, 2008, as a key date in the dissolution of the United States of America.
NEUTRON BOMB FED & TREASURY...
Killing the US financial system...and leaving all the people.
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
sm_landlord writes:
Fed to Give A.I.G. $85 Billion Loan and Take 80% Stake
sm_landlord | 09.16.08 - 7:37 pm | #
Thank god those private hedge funds didn't get their way - they'd have taken over control.
Comrades,
With a $1T balance sheet, what's with $90B. Is this short term to pay off CDS derivatives triggering. I wonder who the counter parties are?
GS/JPM/BoA?
I gotta change the batteries on The Super Colander Tin Foil Hat.
Nostrovia,
honestly, it's what, about a trillion the fed put us on the hook for? nice work aholes
"Communism" used promises of mass ownership to create a powerful elite kleptocracy.
"Capitalism" used promises of a free market to create a powerful elite kleptocracy.
I don't want any red herring served up with my justice, so let's just call this what it is: Treasonous thievery.
Any "ism," is just a distraction, not to mention a fairy tale.
Does this mean the kid from the commericals can sleep now?
"Buddy we are with AIG, er...USSR(A)"
Hell then we'd have insurance that runs as well as Vista.
LOL!
CapeColin writes:
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
CapeColin | Homepage | 09.16.08 - 7:39 pm | #
That is different from the last eight years how?
How do you think McCain will explain this? Of course he doesn't understand it at all, but he has to say something. Can he claim that his time in a Vietnamese prison equips him to fix it all? Maybe Palin has a nifty solution. Soccer Moms can fix almost anything and everything.
When do Moody's and S&P downgrade the US sovereign. I'm thinking 2 notches
This morning I was trying to think up the craziest thing they could do. Something unbelievable.
I didn't come up with this. But I expected it even though my simple mind couldn't imagine it, and have been investing using a "truth stranger than fiction" strategery.
Give me some Yen and let's rally!
However, based on conversations on the street, with neighbors, and phone calls from relatives asking for advice, I'd say this is starting to make it into the mainstream awareness bubble. And people are WORRIED.
CapeColin writes:
Is there a coup d'etat going on in America right now? It sure looks like the Federal Reserve and The House Of Morgan are taking control of everything. Laws are being thrown out the window. The next President will just be a figure head unable to move without asking the big boys first.
As Donald Sutherland said to Kevin Costner in JFK: "You're a lot closer to the truth than you think."
"the fundamentals of our econdomy are strong" lol, lol, lol
mccain...bye bye!
it appears we are all blinking at this point
Somebody with almost as deep-a-pockets as Warren had to do it
It's stunning how short-term the thinking has become. We're down to worrying about events within hours, not even days or weeks.
Sound, predictable policy cannot be created in such timeframes. Every decision appears arbitrary, and you'll exacerbate the problem whether you take action or not. Bailout AIG today, but what happens when the next crisis starts?
Is the Fed going to try to find a way to not wipe out shareholders?
Like a bridge over troubled AIG, why can't we be friends?
An $85 billion bailout and AIG stock drops 52% after closing?
What the hell is going on?
Cramer's Gone Nuts..got to be kidding
http://www.investorsbusinessdaily.com/news/story/story.aspx?guid=%7BE271338C%2DBA9D%2D4BF9%2D92D0%2DBA5A4A94269D%7D&siteid=rss
The Worst Financial Crisis In 100 Years?
it to last in to next week.
Oil. Down down down.
Gold. who cares. if you think you need gold buy a
gun and loa
Wall Street crisis could put Fed rate cut in play- AP Big Risk:
Surging Debt Makes U.S. More Dependent on China, Russia, Gulf
States- Tech Ticker Dow Down 500: It Could Have Been Worse, but
'Crash' Risk Remains, Roubini
Time to tranche all of my unsecured subordinated debt and resell it to the Treasury clean up crew.
Oh wait, lookee here- I owe 30K to Cti, and 2k to Ba, and 24K to Crap1, and 10k to Chuse.
I guess I should just tell them I have decided to seek my bailout.
How about $42 boys?
Sounds about right to me;-}
Then I can restructure my secured debts-- ooohh lookie anothe Cit* for 500k- with a Chuse 65K heloc on top - now only good for a total of mebbie 410K-- can I haz a 3% rate too?
Got more! Howz bout my rental purchase in Jan 2007? Second wuz wid Fust Nattie Arizona which is now with Shiela B!! I gotz $100 for ya. Or I takz 2%.
Debt liquidation time- make me an offer and I might just send you some money!!!
Somedaze this war's gonna end...
"Fed to Give A.I.G. $85 Billion Loan and Take 80% Stake
THAT MY folks would be nationalization! Ruskie style!"
C'mon. That would be: "Give us the keys, hands up!"
Max asks "but what happens when the next crisis starts?"
There is a huge one on deck right now (Whammmmmoooo!)
My real-time AH quotes show the stock hanging at $2.50; gotta react sometime.
Is there a coup d'etat going on in America right now?
fait accompli (more bad french)
Well, maybe the fed can self-finance a deal to Blackrock for $0.20 on the dollar in six months.
This is the bailout to nowhere....a Palin exclusive.
Mc Cain to win??
http://www.investors%2D4BF9%2D92D0%2DBA5A4A94269D%7D&siteid=rss
Dow 5,000?
it to last in to next week.
Oil. Down down down.
Gold. who cares. if you think you need gold buy a
gun and loa
Wall Street crisis could put Fed rate cut in play- AP Big Risk:
Surging Debt Makes U.S. More Dependent on China, Russia, Gulf
States- Tech Ticker Dow Down 500: It Could Have Been Worse, but
'Crash' Risk Remains, Roubini
Just flew past 800 visitors, up to 825 as of this post. Damn busy week!
Forbes.com File Not Found
LONDON, Sept 16 (Reuters) - The sense of crisis engulfing interbank money markets deepened on Tuesday as the cost of borrowing overnight dollars surged above 10 percent, indicating that money markets had frozen and counterparty trust broken down completely.
80% share? Does that require share holder approval?
There is a huge one on deck right now (Whammmmmoooo!)
Plantagenet
Not the Frisbee maker. Isn't anything sacred?
Socialism. But without the healthcare.
AIG just the butterfly in the coal mine?
Viking
Vikings learned Norman French. You're forgiven.
Ah-nold for President?
California Gov. Arnold Schwarzenegger says he will veto a state budget passed after a 78-day stalemate, setting up a historic showdown with the Legislature.
As the San Francisco Chronicle explains, the proposed budget sought to close a $17 billion deficit for the fiscal year that began July 1 without new taxes, a demand by Republicans. It did so by requiring all taxpayers to make earlier and larger tax payments to the state government.
Schwarzenegger, a Republican, made the announcement this afternoon. The veto will mark the first time in modern history that a California governor has rejected a veto a state spending plan. The Democrat-controlled Legislature has said it is prepared to override a veto.
Yesterday, about 12 hours before the last vote was taken at 2 a.m. today, the governor sent Assembly and Senate leaders a letter threatening the veto
"I have been very clear this entire year that I would be unable to sign a budget without meaningful budget reform," the governor wrote, stressing that spending cuts were needed.
Comrade dryfly,
"Hell then we'd have insurance that runs as well as Vista."
Now we get one that runs as well as the FED. Just sayin'.
Nostrovia
So whatever happened to the ten bank consortium?
Let the SH lawsuits begin as they get wiped out...
Time to cue Lefty's theme song (courtesy of David Alan Coe)
How Do You Spell Relief?
(I Get D-R-U-N-K)
Maybe George Bush will run AIG after the election. That would be just grand.
There is a huge one on deck right now
Nah that one was solved already, didn't you hear? JP/Chase will take care of things, and we'll be back to normal by Thursday.
Dow 14,000 by November!
Now the Big Bailouts only buy another 24 hours for the stock market.
Does this mean I can cancel my car insurance since we have socailized auto insurance?
AIG is laughing at us all.
Never outlive your money.
YouTube -
Short Shorty and Long John.
That is different from the last eight years how?
dryfly
its in our faces?
Article no longer linked on NY Times website... what does that mean?
Paulson asked for senators meeting at 5:00pm according to NYT and that means 'a lot of people' knew there would be a deal!
The Federal Reserve holds the cards and will fold the game sooner or later.
Max writes:
Dow 14,000 by November!
Pessimist!
I'm telling you. Time to max out your credit cards and not pay them back. You will be bailed out.
The Fed announced that Blackwater will now administer Fitch, S&P and Moody's as they are in receivership.
It's linked right here: FED IN AN $85 BILLION RESCUE OF AN INSURER NEAR FAILURE - NY Times
elvis, how do you think we got to this point?
Now we get one that runs as well as the FED. Just sayin'.
Nostrovia
Comrade Misean | Homepage | 09.16.08 - 7:46 pm | #
LOL - ya might not be an improvement.
Proud to be an American, because at least I know I'm free...
wow! rule of law and the toilet papering of the constitution.
fed bails out and nationalizes AIG.
ok, how many trillions of highly leveraged derivatives did we just get? when does the world realize the USA is insolvent?
much worse than our Vietnam oops and France calling our debt payment in glod, resulting in the Paris Accord.
infinitely worse. for my country. not for my investments in the long term.
kick the can to the next admin if you can. these monkeys are punch drunk from lack of sleep if they think this can last more than a week at best.
i expect rating agencies to still get real-ish this month. push on that string all day...
sorry, rant over!
Despicable. Just despicable.
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
Blackwater Employment Opportunities
Do You Know a Company that Provides...
\tTuition assistance, free in house management, free vocational training, free self defense courses, highly competitive compensation, bonuses and advancement opportunities?
\tCorporate sponsorship for employees to compete in regional and national athletic competitions?
\tForested jogging tracks, open air swimming areas, biking trails, an indoor cardio training center and a weight training center?
\tWeight management education, smoking cessation assistance and company provided basic family medical support?
\tCorporate sponsored employee car pooling, on campus wind power generation, bio-diesel vehicle design and development, bio-diesel power plant design and development and an ecological friendly 7,000 acre campus?
\tEmployee driven charitable community outreach programs, employee driven national and international humanitarian support programs?
\tAnd yes - Free lunch every day?
.
Too good to be true? Well there is a company that provides all this and much more - we are Blackwater Worldwide.
"80% share? Does that require share holder approval?"
Technically, maybe. But I didn't see the shareholders offering to buy the warrants... Shareholders are toast if those warrants exercise, but then they might come out ahead of where they would have been in a BK. If I has shares in AIG I would shut up and say "thank you, sir". An 80% haircut is better than a BK.
Maybe we can follow the Fed's coup d'etat with another coup d'etat by the People.
This loan will be senior to common and preferred. If the 'loan' is not paid back in full, the equity (common and preferred) is wiped out.
Of course, this is also functionally equivalent to a senior equity injection, which shows the how unlimited the Fed's powers really are. "Debt" and "equity" are just labels slapped on instruments. A good lawyer can write what is basically an "equity" investment with loan documents (like a participating subordinated loan or a thinly collateralized loan with warrants like what the Fed is doing) or write what is basically a "debt" investment with equity documents (a joint venture agreement where the money provider gets all its "equity" back plus a preferred return prior to any other distributions (and you could also include a guarantee)). Saying the Fed can "only" make collateralized loans is really meaningless. It can make any investment it wants and just slap a "loan" label on it.
I keep tellin' ya, I'm coming back in a big big way!
"So whatever happened to the ten bank consortium?"
For starters, they now get to stay in business - if they can. AIG would have taken them out either of two ways - by the loan or by BK.
Ross: Ich sprechen Deutsch besser.
Comrade crispy,
"Does this mean I can cancel my car insurance since we have socailized auto insurance?"
Yes, but the paper work all has to be done in tripliket on an IBM selectric and mimeographed, sent snail mail to USAIG. You may get a response back in 5-6 years, asking you to correct a trivial error and resubmit.
Nostrovia,
"Maybe we can follow the Fed's coup d'etat with another coup d'etat by the People."
not easy when the people's most prize possessions are a bicycle and a rice bowl
uhhh...what happened to the desire for stable market's?
Just put "remit to Paulson" on all your 1040s!
Nostrovia
Comrade Misean
gesundheit
The only problem the talking heads see is mark to market accounting. They think it is the accounting is the problem, and all the financial firms that are going under are actually solvent. This is drving me crazy.
Dollar rallying, just broke 1.40 to the Euro.
Paul has Fannie and Freddie. Ben has BS and AIG. Don't let that fool you! Paul is way, way ahead!
Saying the Fed can "only" make collateralized loans is really meaningless. It can make any investment it wants and just slap a "loan" label on it.
Anonymous | 09.16.08 - 7:52 pm | #
Sums it up perfectly
So who backstops the government? Oh yeah--our warm (or cold) bodies, the difference may be moot.
old fker says don't worry about the FED's balance sheet, it's an unlimited balance sheet.
Start the presses.
jesus!
okay what
the
fuck
now i'm really beginning to think whether lehman was let go cuz they were a bunch of obama supporters.
That is different from the last eight years how?
I for one am looking forward to the next 8 years when Sarah Palin gets to tell me what business I can run, what clothes I can where, what doctor I can go to and whether my new girlfriend gets to take birth control or not (since McCain's only got 2 years left in him).
People who want more government involvement in their lives better watch what they ask for.
They just might get it.
I emailed my senator this:
(I think it's cute, but I may end up going to Guantanamo Bay due to the last paragraph)
==
(I sent this to the MN Senator):
I know you will never read this message. I know I'll get the standard "thank you for your concern" letter back from you by email. But for some reason I just thought I'd write. I guess it's cathartic.
If you haven't noticed, we seem to be bailing out an awful lot of very rich people lately. Fannie and Freddie, AIG, Bear Stearns. This is costing us BILLIONS AND BILLIONS of dollars. Why don't we as a people have a say in this?
I find you to be an honest and responsible senator, but unfortunately financially illiterate. That's ok, we all have our strengths. But maybe you could try learning some of this stuff so that we have a say? Not from the Wall Streeters though... maybe from somebody at Carleton's or Macalester's department of economics.
Recently, AIG REFUSED an offer to be bought out by private parties, and then blackmailed the Federal Government into bailing it out. Interestingly, I note THAT THEY ARE NOT EVEN AN AMERICAN COMPANY since they conveniently relocated to the Caribbean to avoid taxation. Maybe you could use that as political capital?
How many more FOREIGN companies will we bail out to allow the rich CEOs to have golden parachutes? how many more times do we have to watch as billionaires are bailed out of their bad investments? Just wondering.
sorry for how poorly this is written. I really am at wit's end.
Oh: by the way: the next bailouts on the table are Washington Mutual and Wachovia Bank. we won't talk about Ford and GM and Chrysler or the airlines for now.
Lastly: could you at least steer some bailout money to Minnesota? why must all the bailouts go to California and New York?
lastly: al qaeda. Al Qaeda has nothing to do with this, but I'm sure al qaeda in a message pops some sort of anti-terror program that will make somebody actually read this email instead of just bouncing it back as an automated message. Might as well give them a chuckle at the plight of regular non-bailed out Americans.
what's next? Why punish people who didn't create this mess...
You might be onto something jd...but...but.. they wouldn't do that, would they?
Schwarzenegger, a Republican?
LOL
Anonymous @ 7:52 --
Saying the Fed can "only" make collateralized loans is really meaningless. It can make any investment it wants and just slap a "loan" label on it.
Good analysis.
Pick a moniker; hang around...
The bigger the mess, the bigger the opportunity for political control.
It's not really our tax dollars.
We owe about 10 Trillion, right? (By the time you read this, it may be much higher.)
And we aren't paying it down at all yet. Hell, we're still running the tab.
So how long until our tax dollars dip 10T into the debt? Unless you make radzillions of dollars a year or plan on living to 300, your tax dollars are probably safe.
Of course, there is no intention of ever paying it off. They're going to run this up and burn it down. This is the end of America.
Comrade Mike,
"old fker says don't worry about the FED's balance sheet, it's an unlimited balance sheet."
Right up until no one will accept dollars and they start dumping treasuries. Then, game over.
Nostrovia,
Bernanke and Pauson will do whatever it takes to hold this rickety financial system together until after the election. The it will be up to McCain and Mooselini to straighten things out...holy shit!
Why don't we as a people have a say in this?
The US of A is a democracy. There are elections every two years. The majority of incumbents are re-elected, every single time. What is happening now is a direct consequence of people most assuredly having "a say in this".
Bread and circuses, we were warned a long long time ago.
The fact is, the free market doesn't work for life insurance. 100 people need to provide for their families, and they figure that probably 2 of them will die this year. They don't mind sharing the costs, but they need to know the payout is 100% certain.
It is absolutely absurd to assume that they have the resources to evaluate the long term financial health of even an established giant like AIG. Management has every incentive to overpay themselves and make risky bets because they are protected by bankruptcy law, and the problems are unlikely to surface except in a "once in a lifetime" credit crisis.
So the efficient solution is a not--for profit quasi-governmental agency to handle all life insurance, like social security, as distasteful as that sounds.
However, I am for letting AIG fail and starting up such an agency from scratch.
YTL,
thanks for the best laugh I've had all day. Superb...
Thank goodness we still don't have the totalitarian nightmare of government health insurance.
That, my friends, would be socialism!
good thing we didn't have to bail out Lehman
$138 Billion Post-Bankruptcy JP Morgan Advance to Lehman; At Least $87 B Repaid by Fed « naked capitalism
comrade currently smoking cannabis,
we can borrow our way out of debt, it's the only option and is working great!
collateral for the loan? bill gross' old boxers. bunch of commies, i had more faith in you to do the right thing mr. paulson, but i was deluded to think bear was a one-off event cuz you were a dear caught in the headlights. sad sad sad.
J6pk won't care about this because they are watching andy griffin or some other crap on tv.
Damn ruined my dinner
Starting on Wednesday if you speak out against the government you could have your insurance canceled.
I ask you, is this any way to run an Empire? The American century? Full Spectrum Dominance? My ass.
AIG saw the bailout possibility and executed perfectly. These guys are smart. They sure schooled Bernake, Paulson, and Harry Reid.
Ultimately, mediocre businesses rely on customers. It's the truly well-run businesses like AIG that take the business plan to the next level.
Massive bonuses for the AIG executives, you guys sure earned it! I hope WaMu and Wachovia are taking notes.
Gonzo General Hank Paulson has declared a war on financial sensibility according to Reuters.
Yearning To Learn writes:
I emailed my senator this:
(I think it's cute, but I may end up going to Guantanamo Bay due to the last paragraph)
==
(I sent this to the MN Senator):
Which one or both?
Also - send it to Al F... maybe it will end up as a skit on SNL.
thanks for the best laugh I've had all day. Superb...
thanks for the compliment. although I really did send it to my senator (no joke) so if none of you hear from me in the future I'll probably be detained.
Besides: the letter was my way of "giving back" after trouncing everybody with my predictions today. I just wanted to keep it real, ya know. gotta stay with my peeps.
I feel like a little humor is needed today.
I'm still confused, I thought when Bear got bailed that was supposed to prevent others from going other, they weren't lying to me again, where they?
Oh wait, that was F&F getting bailed that was supposed to prevent all this...I suppose AIG will be the one to prevent all this...Am I the only one that has figured out, NOTHING is going to prevent all this?
CNBC reporting govie loan to AIG for 85% stake. The only way to stop this is a regime change.
It's no wonder that in some countries they storm the Bastille.
Comrade CSC,
"or plan on living to 300"
It's in my play book. So is building a super cape that makes me fly. Last test on the latter was slightly painful. But I think I actually caught some air.
Nostrovia,
Starting on Wednesday if you speak out against the government you could have your insurance canceled.
We have freedom of speech in this country and you have the constitutional right to say whatever you want...
Just don't expect to be here after the next round of purges if you do.
ice one YTL. Fck can I copy and send it to our NC senators?
Thank you...
Depressed here.
? who fails next ?
How soon before the Fed balance sheet is raised beyond 1 trillion?
o kristina, you are not alone. we've been talking about this for years.
good old math and ponzi vendor based financing.
Worse in Russia:
By Conor Humphries in Moscow
September 17, 2008 12:13am
RUSSIA'S main stock market suspended trading today after plummeting more than 11 per cent, having lost more than half its value since May, as failing Wall Street banks caused panic on global markets.
The benchmark RTS index halted trade after a fall of 11.47 left it 54 per cent below its record close on May 19. The ruble-denominated Micex was also suspended for an hour after dropping 16.6 per cent.
"Panic has gripped the Russian stock market," read a headline on the Interfax news agency.
Those hardest hit on the RTS were energy companies, with state-controlled gas giant Gazprom falling 17.2 per cent and oil firm Rosneft losing 19.12 per cent.
"The turmoil on Wall Street and worries about fall in the oil price are keeping buyers away despite the cheap prices," said analyst Chris Weafer in a note from Moscow-based investment bank Uralsib.
"The only feeling is one of numbness, shock," he said. "The hope is that this is the final clear-out, that this week we will find a floor."
dry:
I sent it to both (klobuchar and coleman)
sending it to Al Franken isn't a bad idea.
maybe I'll get 15 minutes of fame before my detention!
Paulson and Bernake don't want to be the ones presiding over the big crash. A slow death, treasury funded, will work just fine.
It wasn't Paulson (Treasury), it was Bernanke (Federal Reserve). From everything I've read, Paulson wanted them to take their medicine and deal with bankruptcy.
Thank goodness we still don't have the totalitarian nightmare of government health insurance.
That, my friends, would be socialism!
We have a government that can't even manage it's own finances or manage to turn anything remotely approaching a profit. I wonder what kind of disaster they'd make out of health care.
I suspect it would end up looking a whole lot like housing does today.
This is nothing short of a coup. This is maddness, insanity. Absolutely bedlam.
Words cannot describe. Sleazy crooks running the show here. Won't be surprised if GW Bush becomes CEO and Chairman of the Board of the new AIG.
ytl, the 49th parallel isn't that far north. however, as of tomorrow, we don't take greenbacks. bring something a little more useful.
Comrade Misean
Treasuries already down big ...
U.N. agency eyes curbs on Internet anonymity
SEM Blog - ZDNet claims the UN is looking into curbing internet anonymity.
5th September 2008 4:37 pm
ZDNet having published a report stating that a group made up of, amongst others, the UN, the US government and the Chinese government, is drafting a series of technical standards to define methods of tracing the source of internet postings and curbing the ability of web users to remain anonymous.
*** Chinese government *** - no thanks!
Thanks Alan, I always thought you were a hottie, you should dump Andrea...
I love finding you guys BTW, I used to trade with a great bunch of people on an IPO board back in the boom times of the tech bubble...You all remind me of them. Heck, some of you might even be some of them...We had a dryflydrift on that board.
I would never want to live to 300 unless I could bag young chicks. (No older than 80) Can you imagine a 300 year old vagina? Still wanna live it out?
There might be a market for the capes on Wall St. though. Sell them to potential jumpers with a money back guarantee.
"Don't worry, man...these bad boys are AAA rated for safety."
Wayne Angel - "The Fed balance sheet has no upper bounds"
Is it improper to ask, "Who didn't Lehman Brothers blow?"
Spread the word -- instead of waiting for our next "stimulus" check, let's have every American skip their credit-card and mortgage payments in October & November.
YTL & Sb
stop you're both right
anyone know which line on this year's 1040 will be devoted to AIG and BSC related misc tax?
thanks
Look what NYT just sent:
Breaking News Alert
The New York Times
Tuesday, September 16, 2008 -- 8:00 PM ET
Fed Readies A.I.G. Loan of $85 Billion for an 80% Stake
The Federal Reserve was close to a deal Tuesday night to take
a nearly 80 percent stake in the troubled giant insurance
company, the American International Group, in exchange for an
$85 billion loan, according to people briefed on the
negotiations.
An earlier news alert, overstating the progress of the talks,
incorrectly reported that a deal had been completed.
Can you imagine a 300 year old vagina?
Certainly if I had one, it wouldn't be welcoming any old prick.
Comrade YTL,
"Besides: the letter was my way of "giving back" after trouncing everybody with my predictions today. I just wanted to keep it real, ya know. gotta stay with my peeps.
I feel like a little humor is needed today."
Dear Babs and Diane,
Hi. Umm...do you think you could get off your friggin' asses and take a look at this AIG thing?
Anymore typing would be a waste.
Nostrovia,
Is it improper to ask, "Who didn't Lehman Brothers blow?"
Miss Manners might disapprove, but the obvious answer to your question is Benny and Hanky.
Is this legal?????
Fannie/Freddie were government-sponsored, but AIG? Can the government just wipe out shareholders without any consent from shareholders?
Does anyone in the MSM crowing about this stick-save have the least bit of concern about the Constitutionality of this maneuver?
The Constitution went out of favor with the Patriot Act.
Can't take anymore crap now
I'm just going to watch Nova now.
Comarade Mike out!
A poorer Mike after tonight I must admit!
Can you imagine a 300 year old vagina? Still wanna live it out?
You're ignoring, too, the effects of shrinkage on your [i]own[/i] body. By age 300, what you've got left is little more than a pair of raisins and a grape.
ben = voldemort?
he might have that 300 year old prick you need lisa
Can you imagine a 300 year old vagina?
Yes I can.
http://www.judiciaryreport.com/images/nancy-pelosi-5-30-08.jpg
"An earlier news alert, overstating the progress of the talks,
incorrectly reported that a deal had been completed."
NYT helps out with trial balloon?
I think it's an early out for Asia...
Nobody writes:
Yes I can.
Dude...you just gave me ED. Not cool.
"Nobody writes:
Can you imagine a 300 year old vagina?
Yes I can."
There is a desert tortoise joke in there somewhere.
From WSJ:
"Customers outside the U.S. accounted for 79% of AIG's insurance premiums last year, with Japan and Taiwan among its largest markets."
Suckers!!!
lisa: marry me
I actually feel nauseous.
Wondered today about whether there might be a "loan" a la Chrysler in 1980; but figured that it wouldn't happen since that took an act of Congress as I recollect.
This would be happening too fast for that. And the senior execs are patting themselves on their backs for their brinksmanship.
My only consolation is, can we the people fire these hacks?
Hell, I'll come back and run the damned thing at a GS level. Take it back to an insurance company and unwind it...quickly.
And then figure out how to replace the Fed.
Yep, we're officially fascist.
Is it improper to ask, "Who didn't Lehman Brothers blow?"
It wouldn't have anything to do with campaign contributions this cycle, would it?
Oops, forgot I'm just a lurker here.
Comrade CSC,
"There might be a market for the capes on Wall St. though. Sell them to potential jumpers with a money back guarantee.
"Don't worry, man...these bad boys are AAA rated for safety.""
ROFL.
Nostrovia,
wally writes:
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
Why? People keep saying this over and over, about every single large company that gets close to the edge, but why is it true? Large insurance companies have collapsed before, without triggering major bank failures. Reliance, Kemper, hell all of Lloyd's was on the verge of a collapse and although it was understood that it was bad news I don't remember anybody suggesting it would destroy the world's financial system.
Mike:
of course you (and anybody else) can use my little letter. I'll need company in Guantanamo.
Dryfly:
I sent it off to Mr. Franken as well.
Comrade Misean:
Here's your tinfoil hat back. I can't use it any longer.
as per our agreement, here's the certified life/car/home insurance policy from AIG paid for with my WaMu check, so that your children can sleep well at night.
Oy again with the communism. This isn't a red 'overthrow' of private companies for some mythical mass benefit, it's corrupt, failed businesses begging the govt to take out their garbage.
And the lapdog gov't obliging. It's not some glorious revolution if someone points a gun at you and says 'take this ebola patient off my hands or I'll shoot him and you.'
What Bennie doesn't get is that eventually all three of you wind up dead.
There is a talk of AIG conservatorship.
Lets look on the bright side, once WAMU and the FDIC go down on Thursday, Bernanke and Pualson can take a weekend off for once...we all know they aren't paid enough to be working 7 days a week after all.
Here's the contact info for NY Fed:
33 Liberty St.
New York, NY 10045
Phone: 212-720-5000
Fax: 212-720-7459
homedad43 writes:
I actually feel nauseous.
Puking helps. It really does.
Elvis: You have a very good memory. You should smoke more marijuana.
Last?
On a somewhat serious note:
Ok, so the Govt will have some sort of stake in AIG. what next?
will there still be enough money for WaMu and Wachovia? Or does this mean we need to get a little more creative and merge them with someone else ASAP?
Is there a man alive who knows what the rules are when the govt owns a multinational insurance giant?
You know Congress can impeach members of the Cabinet. It's happened once before. William Belknap, secretary of war under president Ulysses S. Grant.
Belknap had profited from kickbacks by military contractors. The House began impeachment proceedings, documented the charges, and just before the articles were formally voted, on March 2, 1876, Belknap resigned.
Here's the contact info for NY Fed:
I work on Water Street. If I wasn't working sixty hours a week to keep my job I'd protest.
But the guys in front of the Fed pack some pretty mean firepower if I remember correctly.
crude oil futures going parabolic up 3% AH. euro/usd up to 1.42 (means dollar weakening. gold futures up 0.31%. energy stocks PBR, SU, XLE and GDX, EWZ all up AH.
YouTube -
Don't worry...be happy (slightly modified)
Comrades,
"Can you imagine a 300 year old vagina?"
YouTube -
Galdriel was thousands old. I'd tap that.
BTW I have trouble seperating fantasy from reality. The current market actions are truly making it nigh onto impossible.
Nostrovia,
Perhaps a blizzard of faxes might at least get somebody's attention. I dialed the phone number and got an automated phone system that said "Press 1 if you know the name of the person you wish to contact." I was reaaaally tempted to say "Bernanke" but chickened out.
Some more breaking stories from the NY Times:
"US Flag changed to red field with 50 white stars"
"Wall Street to be now known as "The People's Street" starting at noon tomorrow"
"The Fed to take command of troops in Afghanistan due to systemic risk of failure to US foreign policy"
OK, so AIG turned down private investors because they did not want to lose control of the company, but somehow they will take a loan from the Fed and... lose control of the company? Makes sense to me....
Is this a problem?
NEW YORK (MarketWatch) -- One of the first and largest money market funds has put a seven-day freeze on investor redemptions after the net asset value of its shares fell below $1, in a rare instance in the fund industry of what is called "breaking the buck." Primary Fund (RFIXX:
a $64 billion fund managed by money market fund inventor The Reserve, said late Tuesday that its $785 million holding of Lehman Brothers Holdings debt has been valued at zero.
http://www.marketwatch.com/news/story/money-market-fund-breaks-buck/story.aspx?guid={56A2CEE5-5A53-4A27-A4BA-585CFBE173A4}
Lisa, that was funny.
Har har, get the crowbar!
"let's have every American skip their credit-card and mortgage payments in October & November."
I'm in. Who's with us? Um...hey...turn off those TV's!! We are in trouble here! If we all stick together, we have power! Think of your children...sigh. Maybe next time. Maybe your kids will answer the wake up call.
Back to my zen mantra "republicans are fiscal conservatives, republicans are fiscal conservatives, before heading the treasury Bernake was Bush's top economic advisory, there is no such thing as a fiscal conservative"
In the next couple weeks Americans will wake up to the fact their country is being taken from them.
I'm afraid that to complete this power takeover the PTB will have to create a distraction like a large war event to cower the uppity.
"according to a source briefed on the matter."
More prancing Whores. We need more whores.
Ben Bernanke: "Guess what, AIG is getting a Plum Card!!"
Can you imagine a 300 year old vagina?
Certainly if I had one, it wouldn't be welcoming any old prick.
lisa
You go girl;)
It seems that the multitude of studies of the effect of sleep deprivation on decision-making would be relevant to the Federal government right about now.
Is this a problem?
No, because it's too big to fail.
they will take a loan from the Fed and... lose control of the company?
but keep their salaries. My blood is boiling, I'm off to Lefty's for some medicine.
"Certainly if I had one, it wouldn't be welcoming any old prick."
And that's why the Good Lord gave you a mouth.
Thank goodness we still don't have the totalitarian nightmare of government health insurance.
That, my friends, would be socialism!
Sufferin' Succotash
Yeah, hate for J6P to get anything out of their government.
GS-13 clerks are now determining who can own a home.
GS-13 clerks are deciding what interest rates should be.
With AIG GS-13 clerks will determine whose life policy is paid, whose pension plan is supported and who can buy fire and auto coverage.
I like it - it's good to be a GS-13.
So much for the GOP bullshit about letting the economy pick winners and losers. How about all that "creative deatruction" free market b.s. Kudlow et al spout all the time. Tonight he was a mute and just LOVED the government. What a bunch of scumbags. Of course, they will spin it that they did it for the "little guy". What a farce this country has become.
I apologize. That was over the top. I make myself sick sometimes.
Comrade YTL,
It's all good.
Nostrovia,
I'm no expert but this looks like a leveraged buy-out, except that AIG's shareholders don't get bought out and are replaced by the Fed's shareholders. Who are? That's not rhetorical--I have no idea. Does each Fed Bank have its own shareholders.
Welcome to the ownership society. We own it all now.
Some doofus on CNN just said that AIG is "Too Bit to Fail" because they are listed on both the S&P 500 AND the DOW 30.
Does that mean 1 down, 29 to go?
And after all this, Paulson STILL wants to loosen mortgage underwriting standards?
Wait until a) we can't do any more bailouts or b) we have some kind of asymmetric event that can't be bailed out.
Then it's ball game. Thanks for playing.
Every now and then a business letter transcends the genre. Mr. Hank Greenberg writing to Mr. Bob Willumstad. (per CRs link)
Since you became Chairman of AIG, you and the Board have presided over the virtual destruction of shareholder value built up over 35 years. It is not my intention to try to point fingers or be critical.
What then, are your intentions SIR?
wally writes:
Before you criticize a conservatorship, add up what it would cost the US to have them fail... we are already on the hook because of FDIC and there would be a stream of major bank failures immediately folowing an AIG BK.
We've been using that same excuse since 1998.
Apparently we're going to keep using it until the US government fails.
You can't bail anybody and everybody out; it will simply bankrupt the taxpayer.
Was it Einstein who said insanity is doing the same thing over and over again and expecting different results?
IPO the Fed ... we can still get some money out of this ...
ew thread is up
Welcome to the ownership society. We own it all now.
We own Wall Street's excrement.
They own our wealth.
ew thread up
Elvis:
Y'know, I just deleted a heart felt and serious response to your comment about puking, but screw it.
I'm just going to do it and clean it up with a greenback.
Market wise, today's price/volume action was bearish, given that we broke yesterday's low with - not only higher volume - but all time record volume.
I say short any bounce. SPX still set for 1080
I have been through all this before in Soviet Russia. What you have here is looting of the country by the elite. Soon they wire their money to Switzerland and retire in countries with little known names.
All this talk of Armageddon is simply a way to force the Fed to give out money. There would be no Armageddon, of course. We were promised Armageddon after Lehman BK, and all we got was a giant nothingburger. Great Depression saw companies go BK left and right, and we still pulled through just fine. I think the social safety net is much more developed today than in 1929, so why do we keep screaming 'end of the world'? Only to make it easier to loot you, gentlemen.
I'm just going to do it and clean it up with a greenback.
homedad43
The new paper towel.
So what is the future of AIG after this? Will the Fed just guide them through this tough time and then let them go, a kind of catch and release thing? Or will they essentially go into run-off? Surely this is a temporary thing, whatever it is?
WSJ front page:
Barclays will buy the U.S. investment bank and capital-markets businesses of Lehman. As many as 9,000 Lehman employees will find jobs with the U.K. bank.
"Wait until a) we can't do any more bailouts or b) we have some kind of asymmetric event that can't be bailed out.
Then it's ball game. Thanks for playing."
Nonsense, as long as the Fed has paper and green ink every thing is going to be ok!
For everyone worried about insolvency, debt, and higher taxes, the next fix is being worked on right now:
CHANGE THE ACCOUNTING RULES*
*Fine print: only applicable to large, highly-leveraged companies, hellbent on losing tons of money.
This isn't over. When they bailout the consumer (retailers, mortgage, credit cards), then we're at the bottom. We're just doing the business thing right now.
And that's only 30% of the economy. The "robust" consumer is everything.
Bailouts and accounting rule changes en route soon.
I thought the "Federal Reserve" was not part of our federal government, but a group of banks holding shares.
So on the bright side:
Lots of GS-13 to 15 positions. Lot of GS-11 which is pretty good for flyover land.
Except what agency? This is the lean part of the year for gov agencies. Budgets are pretty much gone. Oh, Special Allocation. Yet you can't get one of thoses in a week.
So basically AIG runs in place. No FDIC like team available for deployment.
They really made this up as they went along. There is no real plan here. After it is announced they are going to be clueless.
CapeColin writes:
In the next couple weeks Americans will wake up to the fact their country is being taken from them.
Unless they let us keep our houses, our Wii, our Comcast cable and the right to eat out at restaurants five times per week on our overmaxed credit cards.
They WILL let us keep doing that, right??
Komrade isn't right. Need something mehr facist.
ac:
"We have a government that can't even manage it's own finances or manage to turn anything remotely approaching a profit. I wonder what kind of disaster they'd make out of health care."
well consider who has been running the government for the past 30 years. conservatives who wish to drown our govt in a bathtub. right wingers who say govt can't solve our problems and then proceed to prove it.
didn't bill clinton say that during his admin. he didn't have full control of the government. that there was an entrenched interest in many parts of the govt that kneel to the invisible hand of the market and Reagan's ass?
i wonder how things would be if our govt wasn't controlled by these nutjobs. maybe the dems can pull off a recovery but we all know it is going to get worse before it gets better. seems to me canada is doing okay and they have a great healthcare program. if the free market types get their way, then govt healthcare would be a massive subsidy of the healthcare industry, not a national healthcare system like canada.
Re retiring to small countries with little known names. My fantasies of revenge hover around insolvent governments withdrawing military protection from satellite nations. Either these rich goons start funding their own armies, or they are subject to banditry and expropriation of their ill gotten gains. Could happen.
OK, in this week the Fed has loaned/spent or promised to:
50 billion for the expanded swap facility
70 billion repo supplement to hold the FF rate
87 billion to JPM to back up their bridge loans to Lehman
85 billion bridge loan to AIG
In addition to what they'd already committed.
262 billion in 3 days. What's left?
"262 billion in 3 days. What's left?"
By my back of the envelope calculations, nothing.
COME TO JEEEEZ-US!
Conjure proclaims, "Let the meltdown games begin!"
COME TO JEEEEZ-US!
CSC: Unless you have a VERY active bedroom life you're already spending more time here anyway. So if the women don't appeal to you at 300, you can always just post here instead!
I love sex but there are many other things I'd happily live to 300 doing.