Paulson/Bush/Obama & the rest of government lied about the bailout. Now they are not buying troubled as assets?
How do you feel about this? They needed the money right away to buy these assets so the legislation was rushed through, and supported by democrats like Obama & Pelosi. Now the money is going straight into the pockets of the bankers.
Nov. 12 (Bloomberg) -- U.S. Treasury Secretary Henry Paulson plans to use the second half of the $700 billion financial rescue program to help relieve pressures on consumer credit, scrapping an effort to buy devalued mortgage assets.
right now, all I can say is people should join activism groups.
I am pledging to http://breakthebailout.com/
It may not be the right one for you, but you need to do something
From the article:
Paulson has committed all but $60 billion of the initial $350 billion allocated by Congress to take equity stakes in banks and in insurer American International Group Inc. Lawmakers, who could reject Treasury requests for the remaining $350 billion, are pushing for aid to automakers including General Motors Corp. Paulson is resisting.
At the least we should be calling our congress people again and telling them no more bailout!
And really, this is because the Government is making good on Credit Default Swaps, not mortgages that are bad.
CDS are legalized gambling. They are sold as insurance, but you do not have to own any part of what you are betting on. It is unregulated and there are 25 trillion dollars of CDS that noone even knows who owns.
Tax payers should not be responsible for this mess
A CDS is a credit derivative or agreement between two counterparties in which one makes periodic payments to the other and gets a promise of a payoff if a third party defaults. The first party gets credit protection, a kind of insurance, and is called the "buyer". The second party gives credit protection and is called the "seller". The third party, the one that might go bankrupt or default, is known as the "reference entity". CDSs became staggeringly popular as credit risks exploded during the past seven years in the United States. Banks argued that with CDS they could spread risk around the globe.
Credit default swaps resemble an insurance policy as they can be used by debt owners to hedge, or insure against, a default on a debt. However, because there is no requirement to actually hold any asset or suffer a loss, credit default swaps can also be used for speculative purposes.
PIX-Ed, I gave you a thumbs down because the auto industry has little to do with this question. GM needs to cut brands, & Daimler raped Chrysler. email me if you want to talk about that or ask a question on it, but its a different issue.
nonwo08, I agree with you on this. (but of course mccain wouldnt have been any different too)
& the auto industry is just another distraction (they could solve that issue with less than 1/10 of what the banks are getting. its a red herring)
savings4...you get a thumbs down because the subprime loans are not the issue. they are a small factor. Only 3.5% of loans are in default. The total market is 12 trillion. We could have paid for all the bad loans with under 500 billion. If that was the problem, it could have been solved a long time ago.
- 1 decade agoFavorite Answer
As you prob know it was about more than the money it was about the secret powers it gave the treasury ...
no over sight and no way to investigate were or how much the money was given..
pretty much legalised bank robbery .
2.4 trillion missing on 9-10-01 then 9-11 happened ...
now we shall see what the obama camp have planned for his inaugural disaster to distract us and further strip our rights and restrict guns ...
- 4 years ago
Things got to big and we don't have enough money to buy out troubled loans. The auto company is not a bank, so putting money there would not have wide spread effect. Improving credit and lowering fuel prices by drilling will help the market, which is what they need. Pooring money into a business without a future because no one can buy cars would be more than fruitless, it would be very stupid. Pelosi is an idiot and short sighted. If she gets the Unions bailed out (because they are a big reason US automakers are not competitive or profitable) she will be an idiots hero, and get the idiot vote she lives on. She would win, the idiots and the rest of us would all lose. The simple path, while that is all democrats can grasp, isn't usually the best method to achieve results. Case in point, to raise revenues democrats raise taxes ... unfortunately that always results in less revenues because it slows the economy as risk increases and possible upside decreases, causing people with money to not put it to work in the economy. Higher Taxation = Less Revenue. Lower Taxation = more revenue. At least every single time it's been done, and JFK knew this, he lowered taxes, and increased Revenues ... as did Regan, as did GWB ... who despite 911, Katrina, and Wars brought in more revenues than the Clinton Administration did (and no, they never had a surplus, only a projected surplus, and a lie to go with it. The economy was tanking as the tech bubble burst before Clinton left office, and we had the Clinton recession that the Press never talks about). I am a Realtor, the whole housing correction means I get about NO income, but even though that is true I know we need to allow the market to truly correct or we will have more trouble long term. Long term thinking is the answer, to everything but getting the idiot vote which usually goes to democrats because they prostitute themselves and betray the country ... at least those with the brains to know what they are doing do, which is many of them ... traitors.
- 1 decade ago
I said it when the number 700 billion was thrown out that it wasn't 700 billion. More like 2 trillion because the government always you hear me always tells us a lower number and say the undervalued the number. Of course I was vilified for it but here we are. It is just the way it is. They say they going to lower taxes without decreasing spending is harmful to the infrastructure so is this.
Is it all the bankers fault?....well not really. But they offer a easy scapegoat because they are bad and screwed up. They inflated values of there assets, al ot of the financial sector pushed thesesub-primee mortgages to people who couldn't afford a mortgage and Fannie and Freddie under the guidance of Bush underwrote mortgages that had no sound principals and would easily default all in the name of increasing home ownership.
But we are to blame. Ask yourself a couple of simple questions. How much Consumer Debt do you have (credit cards, car loans). How much are you upside down in your house? Did you really need tore-fiancee I mean does that kitchen sparkle now? Interest only homes loans make sense for what reason? Why would you agree to the ARM if your payment could jump 500 from one month to the next just because of the flexible interest rates?
Yes in a lot of ways we created this monster. They sold us the dream of the bailout helping us. WHEN ALL YOU HAD TO DO WAS TAKE A STEP BACK AND SEE THAT THIS WAS GOING TO BUSINESSES AND WOULD NOT AFFECT MAIN STREET AT ALL. THIS IS THE REASON I LOVE EVERY POLITICIAN THAT VOTED AGAINST THIS.
Last note the original Bailout was $850 Billion. They had to add those "sweetners" so the republicans could support it.Source(s): Just matter of fact at this point....
- Anonymous1 decade ago
This is a crisis in flux. Many things will change during the course of this problem. Now we can add the automakers to the beggars list.
Treasury Secretary Henry Paulson said Wednesday the auto sector was "critical," but that the financial industry rescue was not designed for car companies.
White House press secretary Dana Perino said the administration is not responsible for the automakers' woes but understands the importance of the industry. Officials are reluctant to make any proposals for new aid, suggesting the companies hold much of the responsibility for their own survival.
The companies have made business decisions "over the years that have led to this situation, but we have gone as far as we can with the authority Congress has given in order to help industries," Perino said.
As unaccustomed as I am to agreeing with George W. Bush, I have to strongly side with him on this point.
If any help is coming I would require that the automakers:
-Drastically cut back on expenses; i.e. drop production on their losing models.
-Slash exec pay/perks (I seem to remember that Lee Iacocca took a token salary of $1 until Chrysler improved.)
-Rewrite the UAW contract.
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- Anonymous1 decade ago
The reason they are struggling to buy the troubled assets is because they don't know which ones are poisonous. The bad debts have been wrapped up and then passed on as good debt. It is like pass the parcel. Nobody wants to be the one who opens the last layer to realize just how bad the "bad" debts are.
That is why some people in the financial sector should be in jail. It is nothing short of fraud and deception.
- Anonymous1 decade ago
We will see in a few months
- Anonymous1 decade ago
You trusted a politician with your money?
lol... people fall for it every time. Every, freaking, time.
- Sunday's BestLv 51 decade ago
The bible states not to put your faith in man. It leads to dissappointment.
- BarbwiredLv 71 decade ago
I don't want them bailing out deadbeats.
- Anonymous1 decade ago
does any of this scam surprise you ?