Obama should save the banks, not the bankers »
Posted By jovial 8 months, 2 weeks ago in Business & FinanceTom Ferguson: Stimulus package is dangerously small; plan for toxic assets shovels money to bankers.
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jovial
Grew up In Brooklyn. Joined the Navy in 1976 stayed in 10 years. Aircraft Electronics tech. Worked for Major Govt. contractor then settled in California ...
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Endoscopy8 months, 2 weeks ago
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ROTFLMAO
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That is such garbage. The stimulus package is not a stimulus package. It is health care, social programs, etc. etc. etc. Only a small part of the bill is somewhat a stimulus package. That is the part going to repair and maintenance of infrastructure. NOTHING in the stimulus package was for financial institutions. That was TARP and the boondoggle bill that Obama signed with over 9000 pieces of pork.
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CHAM8 months, 2 weeks ago
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jovial Great Post. But the good doctor made a statement that I find incredulous. He said the stimulus action was not enough. My question is: What is enough?
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Who are these people who don't mention that $10.6 Trillion was allocated by Bush and another almost a Trillion by Obama. All this isn the last 15 months.
$11.6 Trillion is about $151,140 for each family in America, this debt added to the already staggering debt run up by Bush in the last eight years ( Short Term about an additional $150,000 ) . So your family, just like mine, is now in hock for about $300,000. That doesn't include the about $60 Trillion in long term liabilities that Bush added on during his eight years.
Adding that, each American family is now in hock for around a million Bucks.
How much more does the good Doctor think would be enough?-
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jovial8 months, 2 weeks ago
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I don't know, but it's substantially more than was asked for. Check out the other story I submitted by clicking "The dangerous structure of the American economy" at the top of this page. I found this view of the American economy from Japan interesting and I think you will too.
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alakazam8 months, 2 weeks ago
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Well..I think it is time to let the sharks swim or sink.
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Free enterprise does not come with a guarantee of bailout when you screw it up.
That's why it's called "FREE" enterprise.
I think they have taken quite enough money from the American people by fiat.
Let's do the right thing and refuse to give them any more.
Tough Love and all that sensible stuff you would use when dealing with any foolish child. -
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hyperbola8 months, 2 weeks ago
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Economists with much more credibility say much the same.
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Nobel Prize-Winning Economist Joseph Stiglitz: Obama Has Confused Saving the Banks with Saving the Bankers
We get reaction to President Obama’s speech from Nobel economics laureate and former World Bank chief economist, Joseph Stiglitz. Stiglitz says the Obama administration has failed to address the structural and regulatory flaws at the heart of the financial crisis that stand in the way of economic recovery. ...
...AMY GOODMAN: Should the banks be nationalized?
JOSEPH STIGLITZ: Many of the banks clearly should be put into, you might say, conservatorship. Americans don’t like to use the word “nationalization.” We do it all the time. We do it every week.
AMY GOODMAN: Explain.
JOSEPH STIGLITZ: Well, if banks don’t have enough capital so that they can meet the commitments they’ve made to the depositors, at the end of every week the FDIC looks at the balance sheet, and it says, “You don’t have enough capital. You’re not allowed to continue.” And then what they do is they either find some other bank to take it over and fill in the hole, or they take it into government control—it sounds terrible, to take it into government control—and then sell it.
And that’s what other countries have done when they faced this kind of problem—the countries that have done it well. One of the important lessons is this is the kind of thing can be done well, could be done badly. And the countries that have done badly have wound up paying to restructure the bank 20, 30, 40 percent, even 50 percent of GDP. We’re on our way to that kind of debacle. But that shows you how bad things can be, how costly it can be, if you don’t do it well. ...
http://www.democracynow.org/2009/2/25/stieglitz-
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hyperbola8 months, 2 weeks ago
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Geithner Plan Will Rob US Taxpayers: Stiglitz
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The U.S. government plan to rid banks of toxic assets will rob American taxpayers by exposing them to too much risk and is unlikely to work as long as the economy remains weak, Nobel Prize-winning economist Joseph Stiglitz said on Tuesday.
"The Geithner plan is very badly flawed," Stiglitz told Reuters in an interview during a Credit Suisse Asian Investment Conference in Hong Kong.
U.S. Treasury Secretary Timothy Geithner's plan to wipe up to US$1 trillion in bad debt off banks' balance sheets, unveiled on Monday, offered "perverse incentives", Stiglitz said.
The U.S. government is basically using the taxpayer to guarantee against downside risk on the value of these assets, while giving the upside, or potential profits, to private investors, he said.
"Quite frankly, this amounts to robbery of the American people. I don't think it's going to work because I think there'll be a lot of anger about putting the losses so much on the shoulder of the American taxpayer." ....
http://www.cnbc.com/id/29848741 -
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simonsez8 months, 2 weeks ago
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I've said before, companies too big to fail are too big.
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BAC and C need to be downsized to a level that will make them competitive. The stockholders have been virtually wiped out anyway. Put them into receivership, protect the deposits and dis-member them and sell off the pieces.
We broke up Standard Oil of NJ and ATT. -
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CHAM8 months, 2 weeks ago
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We broke up Standard Oil of NJ for collaborating with the Nazi's in WWII, specifically I.G. Farben.
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But simonsez, you are correct. A failure to stop a Corporation from becoming so big "It's too Big to Fail" is a failure to protect the "little people" , in other words, the non-Elite, from the Elite.
As Hyper says, our erstwhile Government has indeed put the risk on the taxpayer and the profit to the private investors.
When the poor have to guarantee the rich their continuance as rich, we have a government turned upside down.
And Endo. This is a serious threat to the future of this country and its people. We need serious help. Can you and your friends find it in yourselves to address the real problem? I for one would really appreciate it. And you might could do something positive.-
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Endoscopy8 months, 2 weeks ago
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Such ignorance. The reason that Conservatives are upset with Obama is that he is trying to fix a recession by doing what has always been the worst thing to do.
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What people like you ignore is history. The European President has said that the path that Obama is charting is a path to "hell". The reason he says that is because some of the European nations tried that solution and had their version of "hell". That path is spend a ton of money and raise taxes. That is the Obama plan. Japan tried it through the 90's and is now just coming out of the problems. FDR had a the Depression lasting over 10 years and Carter created stagflation lasting into the third year of Reagan.
In 1888 there was a depression and it was over quickly, There was a recession in 1921 that was over quickly. Clintons last year started a recession that lasted into the first Bush year. The big characteristic of these depressions and recessions is that the most the government did was lower taxes. They spent nothing.
"When the poor have to guarantee the rich their continuance as rich, we have a government turned upside down."
This statement goes to the heart of liberal hate the rich concept. Go to the constitution and show me where ANYBODY is supposed to have any financial help. This country was set up with the concept that everybody should have equal chance to do what they want to do to earn money. They can do great or fall flat on their face. Nowhere in the constitution or the writings of the founders is there a concept that people have to be guaranteed anything but the chance to succeed or fail. In fact reading the biographies of many rich men you will find that they fell on their faces many times before making it big. They used it as a learning experience to finally succeed.
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DarkWizard8 months, 2 weeks ago
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Like I said 6 months or so ago...there's no bailout plan for the bailout plan. The government is moving too slow to stop the bleeding and therefore helping to perpetuate this downward spiral.
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President Obama has some good logic to what he's trying to accomplish, but too many spineless democrats coupled with the obstructionist republicans will kill the effectiveness of his plan.
The other part of this problem is in the thinking of the "economic team." They are too steeped in dogma and can't see the forest for the trees.
In 3-4 months the government will be forced to nationalize the biggest banks as selling off toxic assets, handing out more bailout money, and other mechanisms and schemes will be found lacking in making these banks solvent. -
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