Did you know we are not giving away 700 billion dollars in this plan?

We are still paying a premium on the assets. We need to get a better deal. We should be getting equity in these companies kind of like AIG.

 

But can't AIG get their equity back as they pay off the loan? I don't mind the equity play at all, but the fact that we are just buying assets and then can sell them .....makes us getting equity of some form.

DD

 

They're borrowing at over 11% though. The loan is collateralized by 80% of AIG.

I think that deal was a steal for USA Hedge Fund LLC.

 

I agree, but we are not doing similar situations.

I would have no problem with the asset purchases being backed by equity or dillution but how do you do that, when you are purchasing assets from the banks?

Do you look at the percentages of their assets that you are purchasing and demand an equal percentage in equity back? What happens when you then sell those assets, does you equity stake go down?

Look, I like the chance for the American public to participate in the upside, it just has to make sense.

Warren Buffet thinks the plan will turn a profit...that is good enough for me....count me in on it.

DD

 

Well I would love for Warren Buffet to run the plan, or if not possible, download his consciousness into a robot that could.

 

I still don't think people will get it. They are so caught up in the words "bailout" and 700 billion.

 

They can get it....Obama could run an ad with Warren Buffet talking about it.

DD

 

Somebody needs to get the message out there. I idolize Buffet. I have been to a couple of his legendary annual shareholder meetings in Omaha, and have also met the man in Houston when they opened up a new Star Furniture location. I read his shareholder reports for fun all the time. There is amazing knowledge and information in his letter to shareholders. It's sad that he kind of overshadows Charlie though who I think is just as smart. But Charlie seems to be content with that.

 

What Buffet and Gross fail to include besides expected gains of 10-12% and cost of capital 3-4% is the absolute interest payment increase if we're changing out 700 billion in AAA Treasury bonds for illiquid crap.

If we have to increase our int rates, then the aggregate absolute increase in interest paid and opp cost should be factored into that and i'm sure it would skew that percentage.

I'm still for it, but this is a concern that no one seems to be talking about.

 

Yeah, NPR was talking about it yesterday, which is when I learned it wasn't a simple giveaway. I like the plan better now.

 

We might be just giving away $700 Billion with this plan. No one else wants to buy many of these securities at any price. That doesn't bode well for the promise of a return.

To be fair though, after we print up the money to do this, we'll just be exchanging worthless paper for worthless paper. I guess that's a fair deal.

 

He says he would, but only the government can so the government should make the best deal possible.

 

I could have told you Buffet favors the bailout he just invested in Goldman Sachs which will be bidding heavily to manage the assets.

Paulson is the former CEO of Goldman Sachs and Buffet will benefit from the bailout. Perfect timing for Buffet to buy into GS.

If the Federal Reserve hires GS to manage the assets Buffet gets no risk profits.
He's not filthy rich for nothing.

 

Do you have any idea what Buffet's investment philosophy is? Do you know why Goldman is still standing today? Buffet is generating $500 million a year from this deal, just on the dividend.

 

Like I said Buffet is rich on purpose.

He would be crazy not to be pumping the bailout.

 

He's not pumping the bailout to protect his investment in GS. He invested in GS because he got a killer deal, and was happy with the fundamentals of the company as well as the management.

Was he pumping the bailout in the future when he called these derivatives "financial weapons of mass destruction" years ago?

 

Financial institutions are "designated as financial agents of the Government." This is the New Deal to end all New Deals.

• Then there's this: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency." Translation: the Secretary can buy up whatever junk debt he wants to, burden the American people with it, and be subject to no one in the process.

There goes your country.

Even some so-called free-market economists are calling all this "sadly necessary." Sad, yes. Necessary? Don't make me laugh.

Our one-party system is complicit in yet another crime against the American people. The two major party candidates for president themselves initially indicated their strong support for bailouts of this kind - another example of the big choice we're supposedly presented with this November: yes or yes. Now, with a backlash brewing, they're not quite sure what their views are. A sad display, really.

Although the present bailout package is almost certainly not the end of the political atrocities we'll witness in connection with the crisis, time is short. Congress may vote as soon as tomorrow. With a Rasmussen poll finding support for the bailout at an anemic seven percent, some members of Congress are afraid to vote for it. Call them! Let them hear from you! Tell them you will never vote for anyone who supports this atrocity.

The issue boils down to this: do we care about freedom? Do we care about responsibility and accountability? Do we care that our government and media have been bought and paid for? Do we care that average Americans are about to be looted in order to subsidize the fattest of cats on Wall Street and in government? Do we care?

When the chips are down, will we stand up and fight, even if it means standing up against every stripe of fashionable opinion in politics and the media?

Times like these have a way of telling us what kind of a people we are, and what kind of country we shall be.

In liberty,

Ron Paul