$1 trillion

[Max Fischer]

That's the problem with the bail-outs, it's out of Congress and the President's hands. How do you hold Bernanke and Paulson accountable? They can't be impeached and they can't be touched. This isn't a partisan issue, although it is indirectly since they haven't stopped the un-Constitutional power given to these institutions.

 

Last time I checked, Paulson worked at the will of GWB.

[Alaska Darin]

Maybe you should have a working knowledge of how things really work.

Maybe you should learn the definition of sarcasm.

[East Brady]

Last time I checked, Paulson worked at the will of GWB.

Not anymore, from the new bailout law:

 

Sec. 8. Review.

 

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

 

 

 

You can read it here; http://globaleconomicanalysis.blogspot.com/

[Steely Dan]

You do know that Bush is President, no? Has been for nearly eight years. What next, blame this on Clinton?

 

 

 

What branch of the government puts forth legislation, funds the executive branch...or not, engages in direct appropriations before, after, and outside of a passed budget, has review and approval power over any executive branch employee, decided to earmark taxpayer cash for this and that to aid in their re-election?

 

Any Administration - Clinton, Bush, you name it, spends years studying the wiring diagrams trying to figure out what the hell all these ensconced Federal government workers do. And unlike equivalents in the private sector, when members of this settled mass get caught breaking laws, the general result is a long period of hand-wringing about whether to gently slap their hands. They generally lose nothing, and stay on the job.

 

Bush advocated lowering taxation. Clinton admitted that his urging to raise taxes was wrong. A republican congress passed legislation for a line-item veto of these packed-full-of crap-and-pork legislative garbage historically coming out of Congress.

 

Clinton was highly pleased about that. But the Klan Wizard, the Prince of Pork, the Dem Sen. from WV - Robt. Byrd - saw to it that such was snuffed.

 

You - and others - ignorantly spew against Presidents - your vile should be directed towards those 535 little Napoleons. They have a Praetorian guard - 1,700 Capitol Police to protect them. A single Senator has something like 3000 sq. ft. of allotted office space. Forget the huff 'n puff about perks - there is a mechanism that deftly avoids their public protestations. They exempt themselves from myriad laws; they walk out of the Capitol building with prohibiting legislation they passed for others in government and show up in the afternoon as powerful lobbyists.

 

So blame the Republicans right?! The Dems have only had a one vote advantage and the Republicans make Democrat spending look frugal. Clinton had a budget surplus at the end of his administration what do we have at the end of Dubya's?

 

 

If only he could ignore the Constitution. Oh wait.

 

 

[Alaska Darin]

So blame the Republicans right?! The Dems have only had a one vote advantage and the Republicans make Democrat spending look frugal. Clinton had a budget surplus at the end of his administration what do we have at the end of Dubya's?

Could we please stop repeating this lie? At some point you goddamn parrots are going to realize that everything that is happening now is a CONTINUATION.

[Lurker]

Clinton had a budget surplus at the end of his administration what do we have at the end of Dubya's?

So, Clinton invented the capital gains tax? Cool! I knew Gore came up with the Internet, but I didn't realize that they were such a 1-2 punch...

[Dwight Drane]

Everyone do yourselves a favor and enjoy tomorrow's home game. Not to sure what the status of the SD game in a month will be.

[Fan in Chicago]

Another take on the current crisis. Consider that the author is a professor of finance at the University of Chicago. His point is that the oft-repeated statement that toxic debts are the root of the current financial crisisis wrong:

 

http://www.ft.com/cms/s/0/13a60574-862b-11...00779fd18c.html

 

In addition, I would add that the basic philosophical problem I have is that he government should not be in the real estate business. Whether or not taking control of this depressed assets will eventually be profitable is immaterial. I have too little faith in the bureaucracy that they will do a good job in disposing off these assets at the right time, keep the sales process efficient and then eventually use the NET gains (if any) in a more productive way that the capital that is being considered for investment right now. No matter how this current bailout is being 'sold' to the public, we cannot deny that the current series of bail-outs will create a moral hazard in the future. Also, pumping so much money into the market heightens the risk of inflation.

[meazza]

Another take on the current crisis. Consider that the author is a professor of finance at the University of Chicago. His point is that the oft-repeated statement that toxic debts are the root of the current financial crisisis wrong:

 

http://www.ft.com/cms/s/0/13a60574-862b-11...00779fd18c.html

 

In addition, I would add that the basic philosophical problem I have is that he government should not be in the real estate business. Whether or not taking control of this depressed assets will eventually be profitable is immaterial. I have too little faith in the bureaucracy that they will do a good job in disposing off these assets at the right time, keep the sales process efficient and then eventually use the NET gains (if any) in a more productive way that the capital that is being considered for investment right now. No matter how this current bailout is being 'sold' to the public, we cannot deny that the current series of bail-outs will create a moral hazard in the future. Also, pumping so much money into the market heightens the risk of inflation.

 

The thing is, August 2007, this debt was considered liquid. At the end of the day, most of it still would be in a normal world... That's finance for you.

[Dwight Drane]

Not anymore, from the new bailout law:

 

Sec. 8. Review.

 

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

 

 

 

You can read it here; http://globaleconomicanalysis.blogspot.com/

 

Well.....it was fun while it lasted.

 

I like the little blurb about how the act is only binding for 2 years, except for the clauses that give Paulson absolute power to redefine the act using any and all means possible.

 

 

For those that haven't figured it out yet, and I don't expect everyone to grasp what is going on, especially now at this fast pace.....but Hank Paulson has just staged a Coup D'etat with help from "your" president and congress. This is nothing short of that. Do not be fooled by any mention of price limits, because the Fed can restock the treasury at any point and the treasury can buy "bad" paper at par from the banks, only to sell it back to them at gutted levels. This is a pure and simple takeover of public funds. The standard of living of the average American will never be the same, and there is a good chance that these actions will accelerate military conflict.

 

I know I have had detractors here on this subject, but for the love of all that is good....please go protect yourselves while you still can. At the very least, pretend that you are about to experience a hurricane or blizzard, and go get food/gas/extra cash to have in case the infrastructure comes crashing down. The severity which has been going on behind the scenes has now been made public, but what hasn't been made public is the most likely future course of actions involving our homeland security and the rest of the world.

 

For those that pray....PRAY. For those that don't, please try and be receptive to prayer as the next few months unfold. All the questions and misery that will pop up can not be solved by a government or a person, or some other galaxy.

 

Good luck again everyone. Stay alert.

[John Adams]

For those that haven't figured it out yet, and I don't expect everyone to grasp what is going on, especially now at this fast pace.....but Hank Paulson has just staged a Coup D'etat with help from "your" president and congress. This is nothing short of that. Do not be fooled by any mention of price limits, because the Fed can restock the treasury at any point and the treasury can buy "bad" paper at par from the banks, only to sell it back to them at gutted levels. This is a pure and simple takeover of public funds. The standard of living of the average American will never be the same, and there is a good chance that these actions will accelerate military conflict.

 

I know I have had detractors here on this subject, but for the love of all that is good....please go protect yourselves while you still can. At the very least, pretend that you are about to experience a hurricane or blizzard, and go get food/gas/extra cash to have in case the infrastructure comes crashing down. The severity which has been going on behind the scenes has now been made public, but what hasn't been made public is the most likely future course of actions involving our homeland security and the rest of the world.

 

For those that pray....PRAY. For those that don't, please try and be receptive to prayer as the next few months unfold. All the questions and misery that will pop up can not be solved by a government or a person, or some other galaxy.

 

Good luck again everyone. Stay alert.

 

Now we're not even going to make it to the SD game? Damn it I thought we had until 9/09.

 

Not that I'm thrilled about the bailout mind you, but your shtick doesn't get old chicken little. There was a poster here who used to write like you--without the religious bent though.

 

20 gallons of gas, some canned food, a water tank, and a wad of (valueless) cash won't save you from the apocalypse.

[DC Tom]

Everyone do yourselves a favor and enjoy tomorrow's home game. Not to sure what the status of the SD game in a month will be.

 

"And Lynch hits the hole...breaks a tackle...one man to beat...he's on his way! He's down to the 20!...the 10!...the 5!...HE'S BEEN TAKEN UP!"

[Dwight Drane]

"And Lynch hits the hole...breaks a tackle...one man to beat...he's on his way! He's down to the 20!...the 10!...the 5!...HE'S BEEN TAKEN UP!"

 

[Dwight Drane]

Now we're not even going to make it to the SD game? Damn it I thought we had until 9/09.

 

Not that I'm thrilled about the bailout mind you, but your shtick doesn't get old chicken little. There was a poster here who used to write like you--without the religious bent though.

 

20 gallons of gas, some canned food, a water tank, and a wad of (valueless) cash won't save you from the apocalypse.

 

No...."we'll" make it to the SD game. There is just a good chance that game won't be played as scheduled.

 

There is going to be a "Banking Holiday" at some point soon. There is going to be a major war in the Middle East at some point soon. There is a good chance that war will drag in Russia, China, etc. and turn into a world war. There is a good chance we will suffer a hit to the homeland soon. There is a chance that the November elections don't happen.

 

This bailout isn't $1 trillion. It is either not going to work, or it will have to be for amounts that will make the dollar worthless. I don't know which way we go. I know this for a fact as the pretty numbers and colors on my computer the past year have told me what a fraud the system has become.

 

It's so close now that I won't waste my breath. I love how people mock others because those others don't match the reality that person wants to see. Reality isn't in a textbook. Reality is now.

[East Brady]

No...."we'll" make it to the SD game. There is just a good chance that game won't be played as scheduled.

 

There is going to be a "Banking Holiday" at some point soon. There is going to be a major war in the Middle East at some point soon. There is a good chance that war will drag in Russia, China, etc. and turn into a world war. There is a good chance we will suffer a hit to the homeland soon. There is a chance that the November elections don't happen.

 

This bailout isn't $1 trillion. It is either not going to work, or it will have to be for amounts that will make the dollar worthless. I don't know which way we go. I know this for a fact as the pretty numbers and colors on my computer the past year have told me what a fraud the system has become.

 

It's so close now that I won't waste my breath. I love how people mock others because those others don't match the reality that person wants to see. Reality isn't in a textbook. Reality is now.

DD we have alot of folks around here that just don't seem to get it, yet the evidence is now raining from the sky.

They will continue to mock and laugh at people until they are clubbed over the head and knocked out cold.

 

American FASCISM is knocking at the door!!!

 

 

http://market-ticker.denninger.net/2008/04...sions-just.html

watch karls video and read his post, he has in fact been correct for along time, he is no dummy.

 

http://globaleconomicanalysis.blogspot.com/

again Mish has been warning about all this for 3 years, he is in fact correct.

 

To the rest of you DOLTS out there, pull your head from your ass and wake the hell up.

 

Keep posting DD, we need your perspective although I do not agree with all of it, it is one more voice from NY.....

THANKS!!

 

My small Silver stash gives me GREAT comfort for the days ahead!!!!

[YellowLinesandArmadillos]

Well.....it was fun while it lasted.

 

I like the little blurb about how the act is only binding for 2 years, except for the clauses that give Paulson absolute power to redefine the act using any and all means possible.

 

 

For those that haven't figured it out yet, and I don't expect everyone to grasp what is going on, especially now at this fast pace.....but Hank Paulson has just staged a Coup D'etat with help from "your" president and congress. This is nothing short of that. Do not be fooled by any mention of price limits, because the Fed can restock the treasury at any point and the treasury can buy "bad" paper at par from the banks, only to sell it back to them at gutted levels. This is a pure and simple takeover of public funds. The standard of living of the average American will never be the same, and there is a good chance that these actions will accelerate military conflict.

 

I know I have had detractors here on this subject, but for the love of all that is good....please go protect yourselves while you still can. At the very least, pretend that you are about to experience a hurricane or blizzard, and go get food/gas/extra cash to have in case the infrastructure comes crashing down. The severity which has been going on behind the scenes has now been made public, but what hasn't been made public is the most likely future course of actions involving our homeland security and the rest of the world.

 

For those that pray....PRAY. For those that don't, please try and be receptive to prayer as the next few months unfold. All the questions and misery that will pop up can not be solved by a government or a person, or some other galaxy.

 

Good luck again everyone. Stay alert.

 

Now, Now, nice internet craziness. This is not true. Maybe Paulson has proposed this, but I doubt it has administration approval, it is not law yet and I seriously doubt Congress will approve. Remember your separation of powers. Congress writes tihe laws, this is just a proposal and I am not sure where it comes from, but even if it gets sent to Capitol Hill in a draft, it will (if legitimate, I doubt) be used as a reference doc and that about it. It is not a piece of legislation, let alone a law.

 

Please, the WH nor the Congress would never give up that kind of power... the previous post doesn't pass the smell test.

[Dwight Drane]

Now, Now, nice internet craziness. This is not true. Maybe Paulson has proposed this, but I doubt it has administration approval, it is not law yet and I seriously doubt Congress will approve. Remember your separation of powers. Congress writes tihe laws, this is just a proposal and I am not sure where it comes from, but even if it gets sent to Capitol Hill in a draft, it will (if legitimate, I doubt) be used as a reference doc and that about it. It is not a piece of legislation, let alone a law.

 

Please, the WH nor the Congress would never give up that kind of power... the previous post doesn't pass the smell test.

 

It is a 3 minute read. This is the bill as of Saturday morning. It has now been "ENHANCED" to add ANY type of debt, including credit card debt, car loans, student loans, etc. Like casino credit, they are limited to clean it out $700 billion at a time, but with the Fed and swaps, they can reload on an unlimited basis. Why do you think Paulson has been on every TV screen saying "We need to do this as fast as possible or else the system will collapse." ????

 

The Draft:

 

Draft Text of Bill:

 

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY

 

TO PURCHASE MORTGAGE-RELATED ASSETS

 

Section 1. Short Title.

 

This Act may be cited as ____________________. <—- Name of the Act

 

 

Sec. 2. Purchases of Mortgage-Related Assets.

 

(a) Authority to Purchase.–The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States.

 

(b) Necessary Actions.–The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:

 

(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;

 

(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;

 

(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;

 

(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and

 

(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.

 

Sec. 3. Considerations.

 

In exercising the authorities granted in this Act, the Secretary shall take into consideration means for–

 

(1) providing stability or preventing disruption to the financial markets or banking system; and

 

(2) protecting the taxpayer.

 

Sec. 4. Reports to Congress.

 

Within three months of the first exercise of the authority granted in section 2(a), and semiannually thereafter, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate with respect to the authorities exercised under this Act and the considerations required by section 3.

 

Sec. 5. Rights; Management; Sale of Mortgage-Related Assets.

 

(a) Exercise of Rights.–The Secretary may, at any time, exercise any rights received in connection with mortgage-related assets purchased under this Act.

 

(b) Management of Mortgage-Related Assets.–The Secretary shall have authority to manage mortgage-related assets purchased under this Act, including revenues and portfolio risks therefrom.

 

© Sale of Mortgage-Related Assets.–The Secretary may, at any time, upon terms and conditions and at prices determined by the Secretary, sell, or enter into securities loans, repurchase transactions or other financial transactions in regard to, any mortgage-related asset purchased under this Act.

 

(d) Application of Sunset to Mortgage-Related Assets.–The authority of the Secretary to hold any mortgage-related asset purchased under this Act before the termination date in section 9, or to purchase or fund the purchase of a mortgage-related asset under a commitment entered into before the termination date in section 9, is not subject to the provisions of section 9.

 

Sec. 6. Maximum Amount of Authorized Purchases.

 

The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time

 

Sec. 7. Funding.

 

For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.

 

Sec. 8. Review.

 

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

 

Sec. 9. Termination of Authority.

 

The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall terminate two years from the date of enactment of this Act.

 

Sec. 10. Increase in Statutory Limit on the Public Debt.

 

Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.

 

Sec. 11. Credit Reform.

 

The costs of purchases of mortgage-related assets made under section 2(a) of this Act shall be determined as provided under the Federal Credit Reform Act of 1990, as applicable.

 

Sec. 12. Definitions.

 

For purposes of this section, the following definitions shall apply:

 

(1) Mortgage-Related Assets.–The term “mortgage-related assets” means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008.

 

(2) Secretary.–The term “Secretary” means the Secretary of the Treasury.

 

(3) United States.–The term “United States” means the States, territories, and possessions of the United States and the District of Columbia.

[bills_fan]

The thing is, August 2007, this debt was considered liquid. At the end of the day, most of it still would be in a normal world... That's finance for you.

 

 

But for the magic that is mark-to-market accounting, this mess would have been mitigated. Mark-to-market accounting was the match that lit the powder keg of bad mortgages.

[bills_fan]

It is a 3 minute read. This is the bill as of Saturday morning. It has now been "ENHANCED" to add ANY type of debt, including credit card debt, car loans, student loans, etc. Like casino credit, they are limited to clean it out $700 billion at a time, but with the Fed and swaps, they can reload on an unlimited basis. Why do you think Paulson has been on every TV screen saying "We need to do this as fast as possible or else the system will collapse." ????

 

 

I read that draft on Saturday. It has been changed since Saturday. Many details are still being worked out. Folks like Dodd are not helping.

[GG]

But for the magic that is mark-to-market accounting, this mess would have been mitigated. Mark-to-market accounting was the match that lit the powder keg of bad mortgages.

 

I wouldn't say it was the match. Just another stick on the kindling. Good to see GS & MS finally kill the investment banking anachronism. Step one to recovery is admitting to a problem.