Bank Bailout Bill

[Dan.Linehan]

Not illegal at all.

• The bailout will cost $700 Billion and raise the U.S. debt ceiling to $11.3 Trillion, which is $81,884 per U.S. taxpayer.
  
  
• New Bailout Bill says all decisions "are NON-REVIEWABLE ... and MAY NOT BE REVIEWED BY ANY COURT OF LAW or any administrative agency."

Thanks Bush.

[JMan]

Originally Posted by Dan.Linehan

Not illegal at all.

Thanks Bush.

We'll see if the Dem congress will reject it. Or pass this proposal.

[Brutha]

We'll see if the Dem congress will reject it. Or pass this proposal.

That would be political suicide.

The only thing that they can do is to add things to the bill or take things away.

[Dan.Linehan]

Originally Posted by JMan

We'll see if the Dem congress will reject it. Or pass this proposal.

Just like Iraq war and Patriot act, congress will sign the treasury theft bill in a hurry and later claim they were misled.

[Dan.Linehan]

Options are:

1. Bush's Plan. (Unfortunately, we've seen how well his plans work in the past.)

2. Something Else.


No blank checks for crooks. Kill Bush's plan now, worry about Something Else later.


Talking Points Memo | Put on the Brakes

Finance industry lobbyists are already giving orders to Republican hill staffers not to allow any meaningful reforms or protections for taxpayers. So, just the money. No strings attached.

Robert Reich speaks on the bailout here.

Put yourself in the shoes of a member of Congress, including our two presidential candidates. The Treasury Secretary and Fed Chair have told you this is necessary to save the economy. If you don't agree, you risk a meltdown of the entire global financial system. Your own constituents' savings could go down with it. An election is six weeks away. Besides, in the last two days of trading, since rumors spread that the Treasury and the Fed were planning something of this sort, stock prices revived.

Now - quick -- what do you do? You have no choice but to say yes.

But you might also set some conditions on Wall Street.

The public doesn't like a blank check. They think this whole bailout idea is nuts. They see fat cats on Wall Street who have raked in zillions for years, now extorting in effect $2,000 to $5,000 from every American family to make up for their own nonfeasance, malfeasance, greed, and just plain stupidity. Wall Street's request for a blank check comes at the same time most of the public is worried about their jobs and declining wages, and having enough money to pay for gas and food and health insurance, meet their car payments and mortgage payments, and save for their retirement and childrens' college education. And so the public is asking: Why should Wall Street get bailed out by me when I'm getting screwed?

[Brutha]

No blank checks for crooks. Kill Bush's plan now, worry about Something Else later.

That's not politcally possible.
The democrates need to vote on some bill that faces the crisis at the moment. Rejecting Bushs bill and having no bill on their own is political suicide.

[OldTex]

This is the on-going story of big business wanting help, but to hell with the average person in our country. Bail out the banks, but screw the consumer.

The government needs it's population in debit, so they can be scared into keeping the jerks in power.

No plan put forth by the current administration is going to benefit anyone except big business. Period.

[escapee]

A more efficient bailout procedure is work in progress (humor)

"Hello! You've reached the United States Treasury's automated bailout hotline. Please listen carefully, because our options have recently changed. If you're too big to fail, press or say 'one.' If not, hang up and dial 1-800-FOR-FEMA.' "

Treasury's automated phone bailout hotline

[Dan.Linehan]

From Glenn Greenwald,

This Paulson bill can be stopped only with widespread opposition that cuts across the standard ideological/partisan lines, and it shouldn't be that hard to argue why handing over $700 billion to the very people who caused this disaster, while allowing them to walk away soaked with profits, is not a good idea, and that vesting unlimited power in the Bush administration to manage that is a particularly bad idea.

Full article here.

[Brutha]

After reading a bit I understand that it really could be possible to oppose the bill. Never underrate how much Americans hate their government

[Dan.Linehan]

Ron Paul on the bailout and financial bubble.

9/21/2008 Ron Paul on the Late Edition with Wolf Blitzer

[Dan.Linehan]

Notre Dame finance professor Richard Sheehan's analysis here.

[Dan.Linehan]

Great take on the bank bailout game here.

Very well put, and I couldn't agree more.


Assets not paper.

[schola]

It's not necessarily true that the taxpayer has to foot the bill for this. Because of the National Debt, there is no direct connection between tax revenue and gov't expenditures.

The Federal Government can essentially pay for this in 2 ways.

1) Raise taxes. (which they won't do)
2) Printing more money.

Printing more money inflates the money supply. Inflation is known as the hidden tax. It's a tax on anyone who is holding US Dollars. I think that is the most likely route that the government will take. This means that everyone who is holding dollars, including foreign governments who have billions in dollar reserves, will pay the cost through diminished value of their money.

[Dan.Linehan]

Why assume the government needs to pay for it at all? These are private businesses.

[jimbos123456]

Firms like guild investments think it is actually going to cost 5-20 trillion when it's all over. I think in this case they should actually use the patriot act against CEOS. They basically did commit high treason and threaten national security. Use the patriot act and send them all to cuba hahahaha instead of innocent people that didn't do anything.

[Dan.Linehan]

I was just going to say - $700B doesn't add up at all. It's just a down payment. A precedent.

Hell, the "We just wanted to choose a really large number," quote basically says it all. There has been zero research into the real numbers, even at this late date.

[Brutha]

There has been zero research into the real numbers, even at this late date.

You can't research the real numbers because the system is broken any more than you can research the amount it will rain the day 30 days from now.
The system doesn't have the information about real numbers of the financial crisis.

You probably should make every financial transaction that investment banks do public on a daily basis via the internet.

[schola]

Originally Posted by Brutha

You can't research the real numbers because the system is broken any more than you can research the amount it will rain the day 30 days from now.
The system doesn't have the information about real numbers of the financial crisis.

This is true. The issue is further complicated because of the derivatives mess. Derivatives derive their value from other financial instruments. The mortgage crisis is nowhere near played out yet, so who knows what the derivatives that are based on those faulty mortgages are worth.

[Dan.Linehan]

Right. Derivatives are exactly why the idea that the government may make a profit off this investment is a total joke.

When the gov bought depreciated assets during the great depression, those assets were real assets. Houses and buildings. Now the assets being purchased are derivatives, auction bonds, CDOs. Not hard assets. Esoteric valuation. There is no real way they can directly gain value.

[Dan.Linehan]

@ Schola,

Get this - the new bailout agreement says that banks no longer need to keep any reserve. At all. None.

[Dan.Linehan]

The extent to which banks can create money through fractional reserve banking is limited by the reserve requirement.

Money creation - Wikipedia, the free encyclopedia

A zero reserve requirement implies an undefined money multiplier. Banks can essentially create as much money as they want.

[Dan.Linehan]

Martial Law declared in Congress? Eh?

[Dan.Linehan]

Back to the bill:

• Mark-to-Model (Mark-to-Myth) continues.
  
  
• Oversight by Bernanke and Cox.
  
  
• Only the top 3 employees of an assisted corporation will have their compensations capped.
  
  
• Suspension of mark-to-market accounting.

[Stephen]

Bail out or melt down.

Melt down unveils the greed and stupidity of neo-liberal capitalism.

Bail out unveils the greed and stupidity of neo-liberal capitalism.

The 'free-market' - Oh Pawwlleeaaassseeeeeeeeeeeeeeeeee.

Behind the spin and hype you will find a landscape of the abused and the abusers.

[JimOfferman]

Originally Posted by Dan.Linehan

Get this - the new bailout agreement says that banks no longer need to keep any reserve. At all. None.

Brilliant! What could possibly go wrong with that?

See you all at the US going-out-of-business sale! Maybe my government can be convinced to buy back New York...

[WanderingOak]

Originally Posted by JimOfferman

Brilliant! What could possibly go wrong with that?

See you all at the US going-out-of-business sale! Maybe my government can be convinced to buy back New York...

You can have New Amsterdam back. Those of us upstate can take care of ourselves, thank you very much.

[schola]

Originally Posted by Dan.Linehan

@ Schola,

Get this - the new bailout agreement says that banks no longer need to keep any reserve. At all. None.

Wow. Got link?

[Poster]

Originally Posted by Dan.Linehan

@ Schola,

Get this - the new bailout agreement says that banks no longer need to keep any reserve. At all. None.

Do you have a link or reference to that, Dan?

[JimOfferman]

Originally Posted by WanderingOak

You can have New Amsterdam back. Those of us upstate can take care of ourselves, thank you very much.

LOL!

I'd rather have you guys make sure that we don't have to buy it back, though... I don't think the US going bankrupt would be very beneficial for any of us.