What about letting them fail, and then going after their personal assets? I know, I know....not realistic.... DD
Criminal investigations and bail out are not mutually exclusive. (I heard FBI is already looking into AIG, Fredddie etc.)
I wouldn't mind doing what the Romans did. Prop the institutions up and liquidate the executives' estates....
We're going in circles now, so I'll stop after this - but this is totally wrong. The only way the net cost comes out to the total initial investment is if every single loan purchased defaults within one month after purchase. It's completely and totally inaccurate to refer to that as the actual cost of the bailout. All the political economists (Krugman et al) who keep mentioning the initial price tag as the total price tag are being deliberately misleading. All of the people who actually work in the field believe the cost will be dramatically lower, and many believe it will be profitable. Today, for example, Buffett - a hardcore Democrat - came out and said it should be profitable. I think these kinds of people are far more credible a source than a bunch of Congresspeople who's background is not even in economics, let alone this complex, convoluted mortgage industry.
No. If lobbyists get stuff like credit card loans and foreign banks added, then it goes up. Plus, nobody can give any real rational explanation as to why the administration's plan will work or even if it will work. This is money down a rathole with the Bush Administration in charge. Madness. It could be better spent for the larger long haul American economy elsewhere. Further, why would Paulie and Bernie be so upset about the limits on Exec compensation and try to justify that opposition by claiming that if it were part of the package some banks would not participate? Are you kidding me? This is a great crisis that has to be solved now and the only option is what the administration wants, yet things are not so dire that leaders of these institutions wanting a hand out are willing to go home if they don't get their way? The whole argument about exec compensation puts the lie to the immediate action crowd. Again, I'm not saying there aren't things that need to be done, but this plan is not it and nothing committing anywhere close to this amount of funds should be done by Friday. It does nothing to change the fundamental structure of our financial markets and nothing to change the culture of those running them. We're at a point where both need to be addressed. The same people (see above) who thought this run was sustainable and created all these goofy financial projects while lobbying like mad to curtail oversight. Right. Buffet's only a hard core Democrat compared to other billionaires. Here's what he said... But Paulie and Bernie are being intentionally vague about the prices they will pay... and if it's going to make a difference, it has to be more than what the stuff is worth now which completely changes the profit projections. If what Buffet says is true, why won't the banks now sell the crap at that rate? They won't because it'd crush them. They're holding the economy hostage over this and want the government to buy this stuff for more than it's worth... that's the whole point of the administration's plan. Buffet is being disingenuous here.... he knows if the plan goes through, the government will overpay which will increase his stake in Goldman Sachs. And is it any coincidence that he picked Goldman, last home of Paulie, to commit $5 billion? And that $5 billion from Buffet stops the bleeding this morning on the Dow, yet we need to commit $700,000,000,000 by Friday with no strings attached for the psychology of the market to right itself? Ugh. (I guess the Repubs were right, though unintentionally. There is a split within the Dem Party, though it has nothing to do with Presidential politics, but everything to do with economic values. Too bad the Repubs did such a good job destroying the Rockefeller wing because it's clear to me you and Sam would be much happier there.)
Here's what the act says... $700,000,000,000 outstanding at any one time? Not total, but outstanding at any one time. If everyone believes the total cost will be lower, why this kind of language?
I would be in favor of a $700 bail out plan, but I think Fox News had a little misprint there. Regardless, this is great. Nothing like seeing the second most reviled guy in the country come out so forcefully for this plan... it's just too bad they wouldn't let Cheney do it. This should kill the administration's plan with voters and send Obama over the top. Then we can get something sane in place.
Good lord. Do you understand simple math? The COST is NOT 700 billion dollars. The COST is 700 billion - x, where x is the value of the assets sold at maturity. It is hard to estimate because it is unknown how much these assets will be valued at maturity, but to assume that every one of these will default (resulting in a $700 billion cost) is unreasonable.
I understand math just fine. Do you understand the way the proposal is written and what Paulie and Bernie said yesterday? It is not unreasonable to assume that there will be losses on every one of these purchases. It's not unreasonable to think these people may come back and ask for more. It's not unreasonable to note that lobbyists are trying to game it for credit card debts and who knows what other kinds of stuff, not to mention foreign banks. Do you understand that they are trying to sell this to people on the basis that there may be a profit at some point down the road? There will be no profit for the American taxpayer... it doesn't take a math genius to figure that out. While we're here, please tell me how the $700,000,000,000 figure was arrived at and tell me also if you think that Paulie would only spend about $50,000,000,000 per month (as they mentioned yesterday) between now and Jan 20 or whether he would all of a sudden find that the crisis is such that he had to put all $700,000,000,000 on the table between now and then. If you think the former, you're the embodiment of the famous P.T. Barnum saying.
Except that Obama and McCain are going to be instrumental in the form of the deal. This will not be helpful to either candidate since both names are going to be all over this thing.
I fully expect a deal. I just really do not want the one the administration put forward. If Bush revulsion helps crater their version, that's nothing but good.
