Putting increasing pressure on the House “no” voters to fall in line, the Senate voted (74-25) overwhelmingly in favor of a $700 bil government purchase of bad debt from Wall Street … with lots of extra caveats.
I’m not going to to into the caveats now. Let’s just say that the 3 page draft has morphed into over 100 400 pages, with new government department for oversight of the Sec’y of Treasury’s decisions (but only via “consultation and recommendations…), and sundry other details (increasing FDIC insurance limits).
The basics remain the same. The government will buy bad assets at whatever the Sec’y of Treasury deems appropriate, hold them until whenever he deems appropriate, then sell them at what he deems appropriate. Who that is? Today, it’s Henry Paulson. After January or thereafter? Serves at will of the POTUS with Congressional approval.
Gee… I feel so much better. NOT! But at least I do know what new job I want….
And it was ironic that, while the Senate vote was going on, the stock market results were on the ticker tape news across the bottom. Goldman Sachs up over 40% from last month’s dive. Gee… that’s the Warren Buffett buyout/rescue. The one where he used a model of preferred stocks that might serve as a better foundation model than we have to choose from today. Certainly it would be at less cost and risk to the taxpayers.
But these options were tossed aside by the elected ones… never to be entertained. Forget the oversight and little extra perks added “to protect Main Street”. The US government has only one fix in mind – and that’s going into the business of buying real estate for the taxpayer…
…and considering they are suspending the “mark to market” authority, and doing one of their famous “studies”, we can safely assume they aren’t even buying in at a wise price.
Why Congress has been so bull headed and refused to entertain other avenues… i.e. preferred stocks, and formations of HOLCs to deal with consumer mortgages, RTCs and RFCs… just drives me crazy. I can only assume that the majority of our elected officials in both chambers is comfortable with a Marxist rule in our future.
This is beyond Obama’s nuanced “socialism”… the kind you have to really look at his history and his words to recognize. This is bold, outright, flat out Marxism, IMHO. And according to both our media, and our elected representatives, we the people are too stupid to know what’s good for us.
Today, talking head after talking head kept saying the public was against this plan because we “don’t understand”. If their condescending ‘tudes weren’t enough, I pretty much went ballastic when I heard Obama make a subtle statement that tells us, the taxpayer, just how “dumb” we are…. but nicely, of course.
He did so in a way meant to go over our heads so we won’t notice he’s insulted us to the max. Using the quote from the blogs at ABC news that Congress should do “what’s best”.. here’s the possible POTUS – the same one so many believe is leading in the polls – barely masking his disdain for “Main Street” in his usual flowery style.
“To the Democrats and Republicans who have opposed this plan, I say this– step up to the plate do what’s right for the country even if it’s not popular, because the time to act is now.”
Does the impact of this statement hit anyone like it does me? We of “Main Street”, as they like to call us collectively, do *not* like this gambling of our tax dollar. And instead of exploring other feasible routes, they tell us it’s their way… or the highway of doom.
And to boot, we have some pompous Senator telling his peers that even tho the idea is unpopular… with *us*, the citizens… we’re too stupid to know that this is what’s “right” for the country. Therefore Congress should step up to the plate, and ignore us, the voters.
I don’t know about you all… but both candidates for POTUS have shown me their irreponsibility tonight with their votes. And quite frankly, I think all of us… both sides of the aisle… had better keep our eyes peeled on our futures. Personal opinion? If the House GOP and DNC caves, this is the beginning of the end of the US as we have known it.
Open for discussion from here… I could use all the “optimism” you can muster…
UPDATE: To show you how “bipartisan” this NO NO NO and did you hear me when I said NOOOOOO! attitude is? Even George Soros says dumb move….
All I can say is it’s a weird day in life that I find myself in agreement with Soros….
Investor George Soros said on Wednesday the the U.S. Treasury’s original $700 billion bailout plan would have done little to address the credit crisis, suggesting instead the government take a direct stake in financial firms.
Global credit markets are in their worst slump in generations as bank lending grinds to a halt on persistent fears about the extent of financial institutions’ exposure to the downtrodden mortgage sector.
Soros said the U.S. Treasury, rather than using federal dollars to buy up toxic mortgage bonds, would be better off making a direct equity investment in the banks. This in turn would spur reluctant private investors to step in again.
“The fact that the plan was rejected in Congress provides an opportunity to amend it to make it more effective,” Soros told Reuters in an interview. “The way to do it is to focus on recapitalizing the banks by injecting equity and actually encouraging existing shareholders to provide that equity.”
Soros said under such conditions, he himself would take an interest in buying up financial shares. This approach worked during Scandinavia’s own banking crisis in the early 1990s, Soros noted, and could work again in the American case.
A government role in the equity of banks is part of the Democrats’ counterproposal to Treasury Secretary Henry Paulson’s original draft legislation, which was shot down in the House of Representatives earlier this week. The Senate would vote on a new bill later on Wednesday. Like most other observers, Soros said the urgency of doing something could not be overstated.
continue reading at link above
Vietnam era Navy wife, indy/conservative, and an official California escapee now residing as a red speck in the sea of Oregon blue.