FYI

[lapfog_1]

From Time, Inc.

By voting down the proposed $700 billion financial bailout package — and causing a spectacular stock market rout — a majority of members in the House of Representatives made a clear statement that they didn't want to put taxpayers on the hook for the failures of financial institutions.

But there's a catch: taxpayers are already on the hook for the failures of financial institutions, and it's possible that the bill will actually be larger without bailout legislation than with it. That's because the regulators who mind the financial industry — the Federal Reserve, Treasury and FDIC — will keep doing what they've been doing: stepping in to prevent the chaotic failure of banks and other large financial institutions. This means continuing to put hundreds of billions of taxpayer dollars at risk, but in a way that adheres to no clear plan of action and doesn't require members of Congress to explicitly approve their actions.

whole article : http://www.time.com/time/nation/article/0,8599,1845609,00.html?cnn=yes

[Tallison]

1. Good post

I don't know what short of a crash course in macroeconomics will impress on folks the devastation that credit liquidity crises unleash on the average guy.

[lapfog_1]

6. There isn't one.

And, of course, you have this dire warning coming from a bunch of fundamentally flawed and discredited Bushco idiots.

But I hate to think of so many DUers agreeing with Darryl Issa and disagreeing with Barack Obama.

Cause and effect will be widely separated as well. It will be 6 months before unemployment hits 7 percent or more.

[Tallison]

10. "But I hate to think of so many DUers agreeing with Darryl Issa

and disagreeing with Barack Obama." Exactly.

That's what's so convoluted about some of the postings here.

Guess I need to take a break from the combat and spend some time with the choir.

[TxBlue]

2. Taking advantage of avg. citzen's ignorance, they loot

What about the 640 billion the fed infused today??????

[RainDog]

3. fyi

http://search.japantimes.co.jp/cgi-bin/eo20080929a1.html

George Soros doesn't think the bail out as it stands is a worthwhile use of taxpayer funds.

Paulson had gotten a blank check from Congress once before. That was to deal with Fannie Mae and Freddie Mac. His solution landed the housing market in the worst of all worlds: Their managements knew that if the blank checks were filled out they would lose their jobs, so they retrenched and made mortgages more expensive and less available. Within a few weeks the market forced Paulson's hand and he had to take them over.

Paulson's proposal to purchase distressed mortgage-related securities poses a classic problem of asymmetric information. The securities are hard to value but the sellers know more about them than the buyer: In any auction process the Treasury would end up with the dregs. The proposal is also rife with latent conflict-of-interest issues. Unless the Treasury overpays for the securities, the scheme would not bring relief. But if the scheme is used to bail out insolvent banks, what will the taxpayers get in return?

More and more this whole situation reminds me of the Iraq invasion b.s. George Soros has to publish in Japan because the corporate media is in bed with Bush, etc. And Jessica Lynch was a hero because she fought off Iraqi doctors.

If Bush and Wall Street and Paulson want credit availability, then they need to be willing to accept terms that do not include a blank check or input from Paulson, really, since he's shown he's a complete fuckup.

[lapfog_1]

8. you have George Soros... I have Warren Buffet.

you have Darryl Issa and company, I have Barack Obama.

I think I'll go with Warren and Barack.

[RainDog]

9. Barack Obama doesn't agree with you

you must not have read the article - or understand that the bail out that was rejected today does not meet the following conditions noted by Obama in the article - which you must not have read...

Democratic presidential candidate Barack Obama outlined four conditions that ought to be imposed: an upside for the taxpayers as well as a downside; a bipartisan board to oversee the process; help for homeowners as well as the holders of the mortgages; and some limits on the compensation of those who benefit from taxpayers' money.

These are the right principles. They could be applied more effectively by capitalizing the institutions that are burdened by distressed securities directly rather than by relieving them of the distressed securities.

Or maybe you are trying to employ the straw man argument that those who do not support today's b.s. oppose any solution. this, again, reminds me of the pre-Iraq bullshit about mushroom clouds if the U.N. was allowed to continue its work in Iraq.

[wtmusic]

4. Ech. There is never a clear plan of action

and most members of Congress don't have a clue anyway.

At least, ostensibly, it will be used when needed - not before.

[Skink]

5. What ever is being done would happen anyway.

Not writing oversite legislation into a package lke this is against our interest. rework the legislation with everything the Dems want and pass it on party lines.

[lapfog_1]

7. If we could but wait 4 months.

But we don't have that kind of time.

And, no, it wouldn't happen anyway.