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Bank Of America Seeking $739bn Bailout - Real Financial Disaster

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International Herald and Tribune

By Edmund L. Andrews

Published: February 24, 2008

WASHINGTON: Over the past two decades, few industries have lobbied more ferociously or effectively than banks to get the government out of its business and to obtain freer rein for "financial innovation."

But as losses from bad mortgages and mortgage-backed securities climb past $200 billion, talk among banking executives about a major government rescue plan is suddenly coming into fashion.

A confidential proposal that Bank of America circulated earlier this month to members of Congress provides a stunning glimpse of how quickly the industry has reversed its laissez-faire disdain for second-guessing by the government, now that it is in trouble.

The proposal warns that as much as $739 billion in mortgages is at "moderate to high risk" of default over the next five years and that millions of families could lose their homes.

To prevent that, Bank of America suggested a new "Federal Homeowner Preservation Corporation" that would buy up billions of dollars in troubled mortgages at a deep discount, forgive debt above the current market value of the homes and use federal loan guarantees to refinance the borrowers at lower rates.

Well, well, well, looks like the cows have really come home to roost.

I would love to know the amount of mortgages deemed "moderate to high risk" in the UK and how the Government would make us all pay for the banks' mistakes.

Edited by Pacific State

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International Herald and Tribune

By Edmund L. Andrews

Published: February 24, 2008

Well, well, well, looks like the cows have really come home to roost.

I would love to know the amount of mortgages deemed "moderate to high risk" in the UK and how the Government would make us all pay for the banks' mistakes.

Wheelbarrows, getchor wheebarrows, fresh today! 2 for a million, lovely wheelbarrows, buy one before you need one to bring me the cash!

Jesus H christ. >.<

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International Herald and Tribune

By Edmund L. Andrews

Published: February 24, 2008

Well, well, well, looks like the cows have really come home to roost.

I would love to know the amount of mortgages deemed "moderate to high risk" in the UK and how the Government would make us all pay for the banks' mistakes.

And the UK Goverment will end up bailing out NR mortgage holders with tax payers money as well I reckon.

This whole situation is shaping up to be very inflationary and we all know how to protect ourselves against that :P

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Guest DissipatedYouthIsValuable

Well, hot dang, that there's some mighty big soundin' number trouble.

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So the American taxpayer is going to bail out the subprime wasters and keep them buying our exports. I could kiss their chubby butts. :lol:

Of course any suggestion that UK taxpayers bail out our own feckless must be firmly stamped on. ;)

And can I just say... $739bn... Jeeezus, that's a lot of money!!

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And the UK Goverment will end up bailing out NR mortgage holders with tax payers money as well I reckon.

This whole situation is shaping up to be very inflationary and we all know how to protect ourselves against that :P

buy buying houses, preferably with debt...

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:lol::rolleyes: pie in the sky- there is no way this can hapen. if the u.s government attempts this or any of the other options that amount to bringing the banks losses due to subprime onto the government balance sheet would send the interest rates on government debt (treasury gilts) to mars with the fed base rate not far behind. its a nice thought though, i wonder how many would want to pay of thier full mortgage if they can get it cut in half by defaulting?

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Wheelbarrows, getchor wheebarrows, fresh today! 2 for a million, lovely wheelbarrows, buy one before you need one to bring me the cash!

Wheelbarrows? I'm going long on pitchforks and torches.

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So the American taxpayer is going to bail out the subprime wasters and keep them buying our exports. I could kiss their chubby butts. :lol:

Of course any suggestion that UK taxpayers bail out our own feckless must be firmly stamped on. ;)

And can I just say... $739bn... Jeeezus, that's a lot of money!!

Well you need to times your $739bn by about 65 to come up with the $500tr being traded in derivatives and if that crumbles than it comes in at a massive $90,000 for every man, woman and child on the earth and since i don't think your average african can aford that amount of debt we are left to face the obvious meltdown.

sure they can let inflation rip but that will only buy time for now so during that time we have left before the big one hits start to think how you will survive without money and take all the precautions you can.

Do you know how many people suffured during the irish potato blite famine and thats one place that has good farming land and plenty of water

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Privatise the profits in the good times - socialise the losses in the bad - pure genius.

Heads they win - tails the taxpayer looses. :lol:

f@ck 'em let 'em burn.

They reset the rates on one of yours. You default and post the keys back on one of theirs. That's the Chicago way and that's how you get the banks. :lol:

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Well you need to times your $739bn by about 65 to come up with the $500tr being traded in derivatives and if that crumbles than it comes in at a massive $90,000 for every man, woman and child on the earth and since i don't think your average african can aford that amount of debt we are left to face the obvious meltdown.

sure they can let inflation rip but that will only buy time for now so during that time we have left before the big one hits start to think how you will survive without money and take all the precautions you can.

Do you know how many people suffured during the irish potato blite famine and thats one place that has good farming land and plenty of water

Look, I'm a bear, but I don't think every penny of those derivatives (often insurance) are going to be called in, and I honestly question where you got that figure from. The main derivative to watch right now are CDSs at $45 Trillion total, but noone thinks that every company insured is going to go bust in the next few years, so noone is valuing the total loss at that amount. 1,2 maybe even up to 5 Trillion at an uberbear max, but where the hell do you get $500 tr from?

Edited by agb41

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Will the US allow recapitalisation via the Sovereign Wealth Funds?

The chairman of Barclays was on TV a few days a go stating that SWF's had allowed banks to recapitise quickly. A "benefit" of globalisation. China Development Bank bought 3.1 per cent of Barclays for £1.6 billion of course.

:blink:

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  • 295 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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