WASHINGTON — The Bush administration on Saturday formally proposed to Congress what could become the largest financial bailout in United States history, requesting virtually unfettered authority for the Treasury to buy up to $700 billion in mortgage-related assets from financial institutions based in the United States.
The proposal was stunning for its stark simplicity: less than three pages, it would raise the national debt ceiling to $11.3 trillion. And it would place no restrictions on the administration other than requiring semiannual reports to Congress, allowing the Treasury to buy and resell mortgage debt as it sees fit.
Staff members from the Treasury Department and the House Financial Services and Senate banking committees immediately began meeting on Capitol Hill, where negotiations were likely to be complicated but quick. Democratic Congressional leaders have pledged to help approve legislation by the end of this week...."This guy is going to leave behind a destroyed military, economy, environment, reputation, as well as a legacy of mass-murder in Iraq and Afghanistan.
Let's pray the drunkard doesn't do anymore damage on his way out, huh?
Just GO AWAY, George W. Bush!!!!
Also see: AmeriKan Socialism
Americans Pulling Money Out of Markets
"Rally, aftershocks end brutal week" by Ross Kerber, Globe Staff | September 20, 2008
Federal officials yesterday imposed emergency measures to stabilize the nation's financial sector, protect investors' savings, and revive lending in an economy convulsed by the credit crisis.
The measures had an instant salutary effect on stock markets, which roared back to erase nearly all the losses of an extraordinary week. The Dow Jones industrial average finished the day at 11,388.44, up 368.75, or 3.35 percent. The bellwether index is now just 33 points below its close of a week ago. Other US stock indexes recorded similar gains.
Early yesterday, the US Treasury said it would provide $50 billion in insurance coverage to guarantee the value of money market mutual funds, which were experiencing massive withdrawals by jittery investors. The Federal Reserve also said it would help finance the purchase of securities from those funds to help their managers raise cash to repay investors wanting their money back.
Where are they getting all these billions? Seriously; this country is broke right now, so where are they getting it? Just printing it? That's a bad idea!
Meanwhile, the Securities and Exchange Commission yesterday instituted a two-week ban in short sales of the shares of nearly 800 financial companies after industry executives complained short sales were exacerbating the precipitous drop in stock markets and worsening the credit crisis. A short sale is essentially a bet that a particular company's stock price will go down; investors borrow the shares and sell them, and then hope to buy them back at a lower price for a profit.
Those measures are part of a broader plan the Bush administration is drawing up with congressional leaders to rebuild the nation's battered financial system. The main thrust is a proposal to have the US government buy the troubled assets of banks and other firms, removing losses from their books so they can begin lending again.
And placing them on YOUR SHOULDERS, tapped-out AmeriKan taxpayers!
"These measures will require us to put a significant amount of taxpayer dollars on the line," President Bush acknowledged in Washington yesterday. But, he added, "the risk . . . of not acting would be far higher. Further stress on our financial markets would cause massive job losses, devastate retirement accounts, and further erode housing values, as well as dry up loans for new homes and cars and college tuitions. These are risks that America cannot afford to take."
Actually, the risk we can't afford is you being in charge for one more minute, you fucking drunk, drug-addled, miserable failure.
Financial specialists said the combination of measures is the most significant intervention in the economy by the US government since the New Deal reforms of the 1930s in response to the Great Depression. Treasury Secretary Henry Paulson said the scope of aid offered by the US government is enormous.
"We're talking hundreds of billions" of dollars, Paulson said at a news conference yesterday. "This needs to be big enough to make a real difference and get at the heart of the problem."
It's a DEPRESSION, people, even if the LYING and MINIMIZING MSM doesn't want to call it that!!!
The measures aimed at money market mutual funds are being warmly received by investment firms after investors, mostly corporations and other institutions, yanked $210 billion from them just this week, fleeing to the safety of bank accounts and securities such as US Treasury bills that paid interest rates of less than 1 percent. On Thursday, Putnam Investments abruptly closed its $12.3 billion Prime Money Market Fund after being overwhelmed by requests from investors for their money back.
Yeah, I'd be feeling pretty good, too, if someone rode to my rescue with HUNDREDS of BILLIONS of TAXPAYER DOLLARS!!!!
I am SO FUCKING FURIOUS at this government right now! Things were BAD ENOUGH with all the wars and tyranny, but NOW THIS!!! This was the FINAL FUCKING STRAW for these assholes!!!
WHERE ARE YOU, AmeriKa?!!!!! I am SO DISAPPOINTED in the PEOPLE!!
WHERE ARE YOU??????
The insurance coverage for money market mutual funds is different than the FDIC program that provides $100,000 coverage for traditional bank accounts. The new coverage would only apply to money market mutual funds that had to close because a surge in redemption requests threatened to saddle investors with losses, according to two people who have been briefed on the plan by government officials. The insurance would be used to repay investors for losses incurred by the fund.
You know, SOCIALISM for the WEALTHY!!!
In addition, the Federal Reserve Bank of Boston will facilitate a loan program intended to ease pressures on money market funds, according to a senior Fed staff member speaking on condition of anonymity because the discussions are ongoing. Under the program, banks would be able to borrow federal money to buy certain securities from money market funds. The funds would then use the proceeds of those sales to repay investors.
I'm so ill with the $$$$ they are tossing at this mess after WASTING TRILLIONS on WARS and BILLIONS on ISRAEL!!! Oh, and the HUNDREDS of BILLIONS the banks have already received.
This place got LOOTED, folks!! Bush and his gang (including Congress) have CLEANED THIS PLACE OUT -- and are no going to go bye-bye!!
And the AmeriKan people are going to allow them to get away with it. I have never been more disappointed at you, Americans. Not even the staying in iraq compares to this.
Bush DESTROYED YOU and YOUR CHILDREN'S FUTURE!!!!
With $3.3 trillion in assets, money market mutual funds hold a significant portion of the country's savings. Harvard Business School professor Samuel Hayes said the plan to protect money market funds was as dramatic as the "bank holiday" President Franklin D. Roosevelt declared in 1933 to protect savings and loan institutions from ruinous runs on their deposits.
So it's Depression-like and Depression-era to the MS, but not a DEPRESSION!! You gotta love 'em; these are the same newspapers who have been saying all week that everything is cool. There is another article somewhere here that talks about EVERYTHING GETTING BACK to NORMAL, can you believe it?
That's why I no longer believe ANYTHING the lying, agenda-pushing, corporate, Zionist-controlled, AmeriKan MSM says anyore. I do not believe a word of their agena-pushing propaganda anymore. NOT ONE WORD!!!!
In Massachusetts, Treasurer Timothy Cahill said his office was contacted by executives from investment banking firm Morgan Stanley asking the state to refrain from lending its securities to short-sellers preying on the bank's stock. The state had previously stopped such lending. Morgan Stanley declined to comment.
Cahill also said this past week he received calls from other institutions, which he declined to identify, warning him to pull state investments out of banks such as Morgan Stanley. Cahill said he ignored the warnings because he suspected the callers were trying to take advantage of the turmoil engulfing those banks.
"I saw some things in the past week that I never thought I'd see," Cahill said.
Meanwhile, fund managers whose have shorted stocks said they weren't surprised by the actions in the face of political pressure.
"The idea that you can't short 800 names, that sends chills up my spine as a free-market capitalist," said Bob Jones, who runs a $100 million long-short equity fund at Robeco Boston Partners in Boston. "But I can see that it's not such a bad thing for everybody to step back and take a deep breath."
Oh, here is the "everything is back to normal" piece.
The sweeping government rescue plan aimed at shoring up the nation's financial system could cost taxpayers "hundreds of billions" of dollars or more, according to the Bush administration.
Administration officials and leaders of the House Financial Services Committee planned to work through the weekend to craft the details of the plan, which would buy troubled mortgage-related assets from financial institutions. It could become the biggest government intervention into the financial system since the Great Depression.
"We're talking hundreds of billions," Treasury Secretary Henry Paulson said at a press conference. "This needs to be big enough to make a real difference and get to the heart of the problem."
The Treasury is likely to run the program, which would involve auctions in which the government would buy the devalued mortgage-backed securities and other assets, said Financial Services Committee chairman Barney Frank, a Newton Democrat. The goal is to put in place a systemwide solution after a case-by-case approach, including the recent $85 billion takeover of insurance giant American International Group, failed to stabilize financial and credit markets.
Frank said yesterday Wall Street executives must give up pay and perks in return for the government rescue. He also promised new controls over hedge funds, short-sellers, and investment banks.
"If you want to participate in this, if you want your company to be the beneficiary of us buying up this paper, you have got to accept compensation guidelines that will remove this one-way street and provide an incentive structure that does not need too much risk-taking," Frank told C-SPAN.
The idea is to restore confidence. Financial firms had halted lending to one another out of fear their partners might have large holdings of mortgage-related assets like the ones that pulled down investment firms Bear Stearns Cos. and Lehman Brothers Holdings Inc., mortgage giants Fannie Mae and Freddie Mac, and AIG. By taking these assets, federal officials hope to get credit markets back to normal.
Details of the plan were still sketchy. Steven Adamske, spokesman for the Financial Services Committee, said the panel was still waiting for a draft proposal from the Bush administration, which it expected to receive by today. The scope of the administration's plan is still unclear, including whether it will limit the purchases to mortgages and mortgage-backed securities, or extend them to other, exotic financial instruments.
Adamske said committee Democrats will insist the plan include a mechanism to prevent financial executives from getting bonuses and other compensation for improved profits that might come after the government buys troubled assets from their firms. In addition, Democrats want the plan to include measures to help prevent foreclosures.
Treasury officials would not comment yesterday. Thursday night, Paulson said the plan needed to address both the inability of financial institutions to sell mortgage-backed securities and the underlying cause, the slumping housing market.
The combination of a frozen securities market and falling home prices threatened to bring down other financial institutions. Sliding home prices bring down the value of the securities, which, in turn, requires firms to raise more capital to cover losses. But as losses continue, investors don't want to risk more money.
Lehman Brothers, for example, was unable to raise enough capital and filed for bankruptcy. AIG had similar problems, and only an $85 billion loan from the Federal Reserve staved off bankruptcy. Merrill Lynch & Co. had to sell itself to Bank of America before it reached the brink.
The rescue plan aims to stop this spiral. The idea is for the federal government to buy the assets and hold them until markets return to normal, when it might be able to sell them and recover some of the money.
The Resolution Trust Corp., which cleaned up the savings and loan crisis of the 1980s, worked in a similar way. The agency sold off some assets, primarily real estate, over several years. The bailout ultimately cost taxpayers about $125 billion.
This one is going to be a LOT MORE!!!!
They are saying a TRILLION DOLLARS!!!!
Some lawmakers favor a different approach this time. Senator Charles Schumer, a New York Democrat, has proposed a model similar to the Reconstruction Finance Corp., which loaned money to struggling banks during the Depression. Schumer has proposed the government establish a similar loan program, take a stake in financial firms, and require them to allow modifications to mortgages to help families keep their homes.
Government take a stake in businesses?
I smell SOCIALISM for the RICH, don't you?