Does Anyone feel like Bailing

[tw]

Originally Posted by TheMercenary

I still believe they pressured the hell out of BOA to do the deal. Now they are just covering their collective asses.

Which is what Lewis (of BOA) was saying in December when the losses (when the spread sheets were corrected to report reality) became obvious. Ken Lewis is no longer saying that now that Merrill Lynch is becoming profitable again.

All this criticism of Bernanke sound like chasing Clinton's penis. As soon as Clinton was out of office, Paula Jones sudden had to pay her own bills. When Clinton was out of office, Paula Jones suddenly discovered her car registration was not even paid for. She did not even know she must register her car because political extremists no longer needed her. This Bernanke nonsense is classic politics rather than addressing the real problems such as Enron accounting.

If they were being honest, most criticism would be at Paulsen and Paulsen’s boss who approved all this. But there is no political advantage to addressing the real issue. The most ignorant among us get inspired when we chase Clinton's penis or how a near entire economic meltdown was averted ASAP.

Never forget faces on those Congressmen when they came out of a meeting with Paulsen and Bernanke. Even deer caught in the headlights do not show that much fear. What they did back then was that desperate and necessary. Only a political agenda would have us forget that reality.

[tw]

Quoted from The Mercenary's WSJ quote:

To review, a critical ingredient in the meltdown was the Basel banking standards pushed by the Federal Reserve. Among other problems, Basel allowed Wall Street firms to claim that highly-rated mortgage-backed securities on their books were almost as good as cash as a capital standard.

How conveniently they rewrite history. But then the WSJ that reports the news is into facts. The WSJ that has opinions can forget those facts. They are two separate organizations.

Basel did not *allow* Wall Street firms to run up a 30:1 ratio. Basel I (that the George Jr administration impeded) required banks to maintain equity. Meanwhile, Wall Street got exemptions from the George Jr administration and created new financial instruments (Credit Default obligations, SIVs, etc) to bypass regulations and Basel I. For example, AIG wrote insurance policies so complicated as to make them exempt from insurance regulation. Today we know what those loopholes created.

Basel II was designed to close those loopholes. But again, George Jr's administration refused to let Basel II be implemented. That WSJ opinion also forgets to mention that part. But then the opinion is about promoting a political agenda - and therefore forgets all the facts.

As any MBA or stock broker will tell us, profits (not servicing America) is the only purpose of business. Basel II would have diminished profits by protecting banking stabity. MBAs and their political extremist supporters feared responsible policies - even delayed or subverts Basel I & II. The opinion even conveniently forgets to mention both Basels.

Basel I did not *permit* those economic threats. Those threats were created to get around Basel I and other regulations. Basel II, that would have addressed those new financial instruments, was simply subverted by the George Jr administration ... so that Wall Street banks could run up 30 to 1 debt to equity ratios.

[TheMercenary]

Funny Cartoon from the years of the past. Sound familiar?

[sugarpop]

Originally Posted by Griff

“Importantly, the decision to go forward with the merger rightly remained in the hands of Bank of America’s board and management, and they were obligated to make the choice they believed was in the best interests of the shareholders and company.”

He sounded guilty as hell. It was like something from Atlas Shrugged.

I agree they should not have been forced to go through with the deal, but according to Ken Lewis, the CEO of BoA, during the hearings about this issue, he said it was right decision, and that he wasn't forced to do it. In fact, in his opening statement, he said they had turned around and had brought in quite a bit of revenue from the deal.

[sugarpop]

Originally Posted by classicman

Quote:
“Much of what the Fed, the Treasury and other agencies did in these transactions remains shrouded in secrecy,” said Representative Edolphus Towns, Democrat of New York and chairman of the oversight committee, said in his opening statement. “It’s time to yank the shroud off the Fed and shine some light on these events.”

Unhappy about the huge bank bailouts that the Fed arranged with the Treasury Department during the Bush administration, many Republicans are even more displeased that Mr. Bernanke is now working hand-in-glove with the Obama administration.

other e-mail between Fed officials shows that Bank of America executives were pressuring the Fed and the Treasury up to the last minute on Dec. 30, when the deal was scheduled to close, to provide written promises that the government would provide billions in new capital and other protection.

Wow - interesting stuff.

Did you watch any of the hearings about this stuff? Apparently the reason WHY Paulson was pushing for the deal to go through is because of what happened after Lehman Bros was allowed to fail. Do you remember what happened after Lehman failed? They really thought if Merril failed as well, the economy would have gone off the deep end, like, for real. We would be in another great depression, like during the 30s. In fact, in a documentary I watched recently (I believe it was on Frontline), Paulson was shocked at how fast things spiralled out of control, because originally he had gotten all the biggest CEOs in a room together and told them to work it out, that they would get no government help. That all changed after what happened with Lehman Bros.


*edit* here is the link... http://www.pbs.org/wgbh/pages/frontl...eakingthebank/

[sugarpop]

Originally Posted by Aliantha

According to the OECD, Australia is in the best shape in the developed world financially, and they've put it down to the govt stimulus packages, along with fairly strict regulations on banking and investments.

My point is of course that it might be too soon to tell if the stimulus package put together by your govt will boost your economy due to its size.

People here won't give it time, and they won't take into account how many people weren't laid off or fired because of the stimulus. All they do is quote how many jobs have not been created. When Obama said those things, it was before we knew how bad it was going to be.

And it's looking like we didn't do enough, like we might need another stimulus, which is what some economists were saying from the beginning, that it wasn't big enough. I just hope, if they do another one, it is all about jobs and infrastructure, and not about tax cuts.

We should be building highspeed rail systems, and hydrogen highways, and giving money to people who are building green cars and green energy companies, and giving money to people to solarize their homes or put in personal wind machines. THAT would create jobs, LOTS of them. Fuck the "cap and trade" legislation, just give the money to people who will create the alternatives, and it will work itself out. I think if people had a choice, most of them would choose to get their power from a green source.

[classicman]

Sounds like the D's learned very well from the R's how to peddle "fear" and get the public sheep to follow along.

[classicman]

Just keep on giving all that money away sugar.

[TheMercenary]

Originally Posted by classicman

Sounds like the D's learned very well from the R's how to peddle "fear" and get the public sheep to follow along.

WOW! you hit the nail on the head. Where are all the liberal sheepel? Baaaaaaaaaaaaaaaa.....

[sugarpop]

Funny. A republican from SC said on the news last night (in a conversation about Gov. Sanders) that they had to fight him on the stimulus. He (sanders) didn't want to take the money, but if they did take it, he wanted to use it to pay down the debt, NOT to SAVE the jobs of teachers and police, etc., which ultimately they used it to save many jobs of people who otherwise would have been laid off. And many other politicians have said the exact same thing. If they hadn't had access to that money, more jobs would have been lost.

See, I believe this is where we are at fault with regard to capitalism. We don't have a problem with the small percentage of people earning the majority of the money, even though good jobs are more scarce and pay significantly less than they used to. And we are always concerned about growth. We MUST grow the economy. How about creating a truly sustainable economy? It is unsustainable to keep allowing the top to grow astronomically while everything else stagnates, especially since the population is also growing, which is also unsustainable. It is more sustainable to have a more level playing field, where there are plenty of jobs that pay well enough so everyone can afford to live comfortably. (I did not say lavishly, I said comfortably.) It is better for everyone if NO ONE has all the concentrated wealth to the extent a small percentage do now.

[TheMercenary]

Originally Posted by sugarpop

It is unsustainable to keep allowing the top to grow astronomically while everything else stagnates, especially since the population is also growing, which is also unsustainable. It is more sustainable to have a more level playing field, where there are plenty of jobs that pay well enough so everyone can afford to live comfortably. (I did not say lavishly, I said comfortably.) It is better for everyone if NO ONE has all the concentrated wealth to the extent a small percentage do now.

[sugarpop]

So... what, are you actually agreeing with me?

[TheMercenary]

..

[TheMercenary]

Who says the Feds aren't in the business of taking over private industry?

WASHINGTON — The House approved a spending bill on Thursday that would impede efforts by General Motors and Chrysler to close thousands of their dealerships.

http://www.nytimes.com/2009/07/17/business/17autos.html

[classicman]

Watchdog: Gov't may have overpaid to bail out AIG

Officials handling the multibillion dollar bailout of insurance giant American International Group Inc. mismanaged an initial rescue attempt and may have overpaid other banks to wind down AIG's business relationships, a government watchdog says.
lationships, a government watchdog says.

The Federal Reserve Bank of New York — headed at the time by now-Treasury Secretary Timothy Geithner — paid AIG's business partners full face value for securities so they would cancel insurance contracts AIG had written in order to ease the firm's liquidity crunch. But at least one of those partner banks offered to canceled the contracts for less, according to a report Monday from Neil Barofsky, the Special Inspector General for the $700 billion financial bailout Congress approved last October.

That means officials may have spent billions more than necessary to cancel debt insurance contracts with banks including Goldman Sachs Group Inc. and others, the report says.

The New York Fed also weakened its bargaining position by refusing to threaten that AIG would go bankrupt after an initial $85 billion bailout proved too small to save the firm, the report says. Furthermore, negotiators led by Geithner told the banks that any concessions would be purely voluntary, the report says.

The result, the report says, was a weak negotiating strategy with little chance of success in obtaining concessions from the banks. It says the initial bailout "was done with almost no independent consideration of the terms of the transaction or the impact that those terms might have on the future of AIG."

As president of the New York Fed, Geithner signed off on many key decisions concerning AIG's bailouts — including the move to pay in full for securities held by other banks, the report says. Also involved were officials from Treasury and the Federal Reserve.

The report says Geithner denied that officials intended to give other banks a "backdoor bailout." Yet it says decisions Geithner approved — "indeed, the very design" of AIG's rescue — meant that billions of taxpayer dollars were "funneled inexorably and directly" to other banks.

It acknowledges that officials had good reasons to save AIG, and were appropriately reluctant to break contracts the company had with other companies. But it says those decisions "came with a cost — they led directly to a negotiating strategy that even ... Geithner acknowledged had little likelihood of success."

How easy is it to hide a few million bucks in a transaction this large. I wonder where all this money actually went.
Oh, and good job there Timmy. . . Not.