Wednesday, September 24, 2008

Lots of zero(e)s

Too Little, Too Late to End Debt Crisis

The bailouts...expected to cost over $1 trillion, are too small to rescue most institutions at risk, let alone address multiple problems with U.S. interest-bearing debts outstanding of $51 trillion and derivatives held by U.S. banks of $180 trillion.

Posted by gardeniadotnet @ 11:07 PM (713 views)
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3 thoughts on “Lots of zero(e)s

  • Interesting times.

    The following comment is highlighted above the Market Watch (Wall Street Journal) lead article…

    We are in a War. It is clearly Main Street against Wall Street. Everyone is taking sides. You must continue to email and fax and call your Senators and Congressman. We go into a Depression either way. But if Wall Street wins, we come out of this naked, crawling on our hands and knees. If Main Street wins, at least we come out with our dignity, standing tall to fight another day like Americans . . . not slaves to Wall Street pigs.

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  • From the FT:

    A draft bill, presented by Senator Chris Dodd, includes a provision insisting that banks insure the Treasury against any losses they might incur on these toxic assets. The bill would protect taxpayers – and give banks an incentive not to knowingly mis-sell the assets.

    The Democrats’ insurance plan, however, turns Mr Paulson’s plan for a “bad bank” and bail-out into an old-fashioned liquidity scheme. Whereas the Paulson plan aims to end the uncertainty caused to the banks by their holdings of these hard-to-price toxic assets, the Democrats would replace the assets with a risky obligation to insure the Treasury against subsequent losses.

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  • gardeniadotnet says:

    I CANNOT STRESS THIS ENOUGH:

    The bail-out states that Hank Paulson can have 700 billion dollars outstanding AT ANY ONE TIME. Once he sells the assets to his buddies on the cheap, leaving the loss to the taxpayers, he can refill the coffers. The legislation allows King Henry to spend UNLIMITED AMOUNTS OF MONEY!!!!!

    As a member of Congress said today, this Bill will make Hank Paulson (unelected, ex-Goldman Sachs), the most powerful man in the world.

    Text of the Proposed Legislation:
    Sec. 6. Maximum Amount of Authorized Purchases.

    The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time
    http://www.nytimes.com/2008/09/21/business/21draftcnd.html

    From MarketWatch

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