"Paulsen called all the banks to Washington as a cover to give money to Citibank...they were forced

[Skidmore]

to take money."

Exchange between Barnicle and Cramer just now on MSNBC.

Did anyone else hear that and did I hear it correctly?

Now, if this is true, those banks were called there weeks ago and this Citibank thing is a fraud of the highest order--a sop to *'s Saudi cronies. A crime is being committed in broad daylight. Meanwhile, a clip is shown of ole Chuck Schumer hyperventilating that Citibank needs to be saved.

[Why Syzygy]

1. It is such a con game.

People are going to believe this... Give more money to the Rich. :sarcasm:
See what a great job they do with our money? They just need MORE of it!

I'm sickened by it, but I think they will continue to fail taking this route.

[Skidmore]

2. If this is true, we are in free fall.

[HereSince1628]

4. Quick empty the treasury!

Bush wants to do it before the Dems can put together a package that could win the class war.

These bailouts are like the Russians burning the fields as Napolean advanced.

Nothing will be left to work with by January.

[tama]

5. Err

There's nothing in the treasury but big pile of IOUs, has been so for decades.

[Why Syzygy]

16. Perfect analogy. nt

[tekisui]

3. The strangest thing to me is that citigroup

was trying to buy Wachovia just a couple of months ago. What a ruse.

[Gman]

6. Are these bailouts self-destruction boobie traps set for Obama

to doom his administration no matter what? The economy will crash and they want Obama to take the blame 2 and 4 years from now?

[Skidmore]

7. I've begun to think so, particularly since we suddenly have James Baker

coming out and asking for Obama to do something jointly with *. I think this demand will start being amplified by the lazy media, who really are hyperventilating over Citibank's dire condition and not once informing the public that they will be bailing out Saudi princes. If Obama gets sucked into this bank bail out, you can be guaranteed that he will be blamed for the blackhole that * and Paulsen have opened up.

[Gman]

11. It's interesting that these bailouts started when it was very clear Obama would win

back early last month. My other theory is that it's a last run on the treasury while they still had a chance.

[SammyWinstonJack]

12. It would seem so.

[bdamomma]

14. of course they are setting up Obama

but then again, the * regime wanted to do this.

[zeemike]

8. Charges of criminality are for the little people n/t

[Tutonic]

9. Citigroup has been broke for the past two months. If Barnacle and

Cramer has claiming that it is all a ruse, they need to be more specific. Paulson did meet with the banks on their demand that he conceal how much money they were pleading to obtain. They didn't want Joe Consumer to know that while they were screwing him on a credit card that they were begging the Feds for 30 billion. Now the curtain is getting pulled back to reveal that they are all insolvent. When Wamu fell it was evident Citi would fall. Now start the countdown for Bank of Crooks--America. Then we all hit a hard surface. Those that survive can start to rebuild.

[Bonhomme Richard]

10. My God! The jobs on Wall Street that might be lost.

But SCREW the auto workers, the machine shops, the fabricators, and every other job shop that happens to be tied to Detroit.

[HamdenRice]

13. This was semi-reported in the Times right after the bailout

IIRC, the Times said that Paulson forced other banks to take bailout money so that the investing public wouldn't know which bank was in trouble.

The concern was that if he had called in only the bank that was in trouble, there would have been a run on deposits and short selling of its shares.

The cat's out of the bag now (ie which one was in trouble).

[DemReadingDU]

15. It was on 60 minutes a few weeks ago, link

10/19/08 Under New Ownership: Bank Of America
CEO Of The Nation's Largest Bank Talks About The Treasury Department's Plans For Buying Into Financial Firms

Banks are supposed to lend money, and when they stop - as they have in recent months - the workings of our entire economy are threatened. Credit became so frozen, the government had to step in this past week and take an ownership stake in the country’s biggest banks.

On Monday Treasury Secretary Henry Paulson summoned the CEOs of the nine largest banks to Washington - and gave them a massive amount of money so they would start lending again.

The largest of the banks is Bank of America (B of A) - now partly owned by the United States of America.

The head of Bank of America, Ken Lewis, says that when he and the others met at the Treasury Department, it became clear that Secretary Paulson's "offer" was an ultimatum - no negotiations.

"In other words, take it or leave it?" correspondent Lesley Stahl asked.

"Right. Right, right."

"It’s said that he told the bankers and you, "This is your patriotic duty," Stahl said.

"I don’t remember if he used the word, but there was an element to that," Lewis said, "that this was the right thing for the American financial system, and therefore it was the right thing for America."

"Did you feel that? Was that a persuasive line of argument?"

"Absolutely," Lewis said. "I deeply believe that. I think he was right on."

"Now explain, why was it so important to the government that everybody agreed, that the nine largest banks are ALL in this?" Stahl asked.

"If you have a bank in that group that really, really needed the capital, you don’t want to expose that bank," Lewis said.

"In other words, stigmatize it."

"Right, exactly."

"So everybody knows that they’re not as good as somebody else."

"Exactly."

"Most of you were just stunned by the amount of money that the government put on the table," Stahl said.

"Yeah," Lewis replied. "At least I was. And I think most everybody else was."

The total was $125 billion of taxpayers' money. Bank of America, Lewis says, didn’t need the money … but got $25 billion anyway.

"Do you have any choice in this?" Stahl asked. "In other words, can you take the money and not lend?"

"We wouldn’t want to do it that way, because you can make more money lending," Lewis said, "and so the intent will be to use it to grow loans and to make more net income."

But under the Treasury's plan, there’s no requirement that a bank use the money to lend. It could use it to acquire weaker competitors - or put it in Treasury bills.

more...
http://www.cbsnews.com/stories/2008/10/19/60minutes/main4531244.shtml