Posted by
Boaz on Sunday, September 21, 2008 5:17:39 PM
WTF!
American taxpayers to bailout Euro banks? I asked a question in a
previous post regarding the proposed bailout package Treasury Sec. Paulson was pushing for.
The question was: "How much of the bailout money is likely to wind up in bank accounts overseas?
Well, without giving a specific number to those of us who have to fund the check Sec Paulson and the CONgress is going to write, Paulson now admits that Euoropean banks will be included in the bailout.
Hello out there! I'm one of those Americans, and I assure you I can make the distinction btween an American institution and one based in.... say, Zurich, London, Bonn, Moscow or anywhere else which doens't belong to the US of A.
It's a no brainer to those who look at the large picture. Foreign nationals and institutions have used the largess of America through oil wealth and stock acquisitions to invest in America.
The Democrat controlled CONgress required lenders to make real estate loans to people who couldn't afford the loan or the house, and the market collapsed.
Those foreign nationals and institutions have now pumped in a small fraction of the cost of the oil wealth transfers back to the United States, and instead of allowing them to lose that investment RISK, Paulson is telling the CONgress to tell me to pay it back.
Bulls**t. The definition of investment risk includes the possibility of LOSING money.
When I risk my money, and lose it, nobody cries, nobody offers to pass a new spending appropriation to fix the booboo. I just lose it and then I go on.
-
"If a financial institution has business operations in the United States, hires people in the United States, if they are clogged with illiquid assets, they have the same impact on the American people as any other institution," Paulson said.
No, it's not the same impact. The company who is losing MONEY is a foreign company. But the illiquid assets are still here, no one came along at night and picked up the house and the dirt and took them back to Switzerland, Russia, China, Saudi Arabia, Kuwait or anywhere else.
That is the salient point the Washington Doofusites have missed, the assets whether liquid or illiquid are still here. There will be disruptions as there always are when the bright boys on Wall Street make a mistake and yield to CONgressional Democrats trying to perform their magical mystery social engineering projects.
The fix for the problem does not include a patch on a bad system. The fix requires allowing the booboo to heal from the inside out. The Wall Streeters who made the bad loans should and would be fired, the Democrats who foisted off the bad economic legislation would be fired and the country as a whole will cinch up it's belt and continue to do what we do best. WORK our way out of the problem on our own.
It can be done. No one in Washington is willing to do it, because it creates a RISK of them losing their position in the New American Aristocracy - CONgress.
And that to a politician is unthinkable, unless they get caught tapping shoes in an airport bathroom, or find themselves the recipient of large amounts of cash for influence peddling and then storing the cash in a home freezer or... name another political embarrassment.
Except that all of the above mentioned problems have not resulted in the dislodgement of a CONgrtesman. The Good Ole Boys Club (unisexual in this case) has seen to the burying of the problems long enough to lose the public eye in the willing accomplices - The "Old News Business" outlets such as CBS, NBC, ABC, CNN, New York Times and the rest ad nauseum.
The
legislative outline that went to Capitol Hill at 1:30 a.m. Saturday had said that an eligible financial institution had to have “its headquarters in the United States.” That would exclude foreign-based institutions with big U.S. operations, such as Barclays, Credit Suisse, Deutsche Bank, HSBC, Royal Bank of Scotland and UBS.
But a Treasury “Fact Sheet” released at 7:15 Saturday night sought to give the administration more flexibility, with an expanded definition that could include all of those banks: “Participating financial institutions must have significant operations in the U.S., unless the Secretary makes a determination, in consultation with the Chairman of the Federal Reserve, that broader eligibility is necessary to effectively stabilize financial markets.”
To say it another way,
Paulson Lied.
He threw out a red herring which was to protect American assets and then changed the rules enough to allow any bank be the beneficiary of American taxpayer money.
Is there anyone else out there who can say PRISON and forfeit you bank accounts now!
All of the lending institutions CEO's should be stripped of all they made in allowing this debacle to proceed over the past several years, including Bernanke who cashed out $500,000,000 in bank stocks to take the helm at the Federal Reserve.
And while we're at it, lets go back to that little pencil neck Greenspan and clean him out too. He's the one who was the willing accomplice of theDemocrat CONgress to do the dirty deed.