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  • #1

    Let's bail out everybody!

    Two groups are looking for handouts from Uncle Sugar. One, a bizarre plea by a bond insurer to the congress to limit short sales on the stock market. Another, the banks (led by a Swiss-American banking conglomerate no less) asking for the government to take over bad subprime loans that they made.

    How about the congress and White House have some spine, and say no thanks to blackmail? I thought the gov't saying "stuff it" to the carmakers asking for handouts would have set the tone, but apparently not.

    First, the bond insurers. From Reuters...

    MBIA Inc plans on Thursday to urge lawmakers to curb the short-sellers beating down its stock, and to push rating agencies to revamp how they assess bond insurers.

    In written testimony for a subcommittee of the U.S. House Committee on Financial Services, MBIA said lawmakers should help restore confidence in the bond insurers, because their failure could have far-reaching effects on the U.S. and global economies. Reuters obtained a copy of the testimony, which is for a hearing on Thursday.
    reuters.com
    http://www.reuters.com/article/businessNews/idUSWEN393720080213


    Then the banks. From the WSJ...

    Worried Bankers Seek to Shift Risk to Uncle Sam
    By DAMIAN PALETTA
    February 14, 2008; Page A2

    WASHINGTON -- The banking industry, struggling to contain the fallout from the mortgage debacle, is urgently shopping proposals to Congress and the Bush administration that could shift some of the risk for troubled loans to the federal government.
    [Sheila Bair]

    One proposal, advanced by officials at Credit Suisse Group, would expand the scope of loans guaranteed by the Federal Housing Administration. The proposal would let the FHA guarantee mortgage refinancings by some delinquent borrowers.

    Credit Suisse officials have met with senior officials from the Department of Housing and Urban Development, which runs the FHA, and other policy makers to discuss the proposal.

    The risk: If delinquent borrowers default on their refinanced loans, the federal government would have to absorb the loss.
    wsj.com
    http://online.wsj.com/article/SB120294935869166831.html?mod=hps_us_whats_news
    Last edited by DanS; February 14, 2008, 12:55.
    I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891
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  • #2
    Re: Let's bail out everybody!

    Originally posted by DanS
    How about the congress and White House have some spine, and says no thanks to blackmail?
    Sure, and we can just pretend like we are trying to avoid recession with some stupid fake rebate checks.
    I drank beer. I like beer. I still like beer. ... Do you like beer Senator?
    - Justice Brett Kavanaugh

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    • #3
      The rebate checks won't work. If we have big banks failing because of this then the government will have to do something eventually and sooner is usually better then later.

      I just hope dunderhead Republicans remember that a lack of responsible regulations is what got us into this, just like in 1987, and maybe next time they won't be so knee jerk against needed regulations.
      Try http://wordforge.net/index.php for discussion and debate.

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      • #4


        Maybe the top executives at these banks and other financial companies should forgo bonuses this year. Maybe they should be accountable, instead of holding out their hands for welfare.

        -Arrian
        grog want tank...Grog Want Tank... GROG WANT TANK!

        The trick isn't to break some eggs to make an omelette, it's convincing the eggs to break themselves in order to aspire to omelettehood.

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        • #5
          These requests just make me spit nails. Mostly, they would be bailing out the overseas (Japanese, Swiss, etc.) banks who hold those subprime mortgage securities.

          F that!
          I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891

          Comment

          • #6
            Originally posted by DanS
            These requests just make me spit nails. Mostly, they would be bailing out the overseas (Japanese, Swiss, etc.) banks who hold those subprime mortgage securities.

            F that!
            From the article.

            "Borrowing costs for city governments and consumers could rise."
            I drank beer. I like beer. I still like beer. ... Do you like beer Senator?
            - Justice Brett Kavanaugh

            Comment

            • #7
              To be accurate, it's typically not the big guys that made the loans, they just bought the securitized packages. I would have little appetite for bailing them out either, though.
              "The French caused the war [Persian Gulf war, 1991]" - Ned
              "you people who bash Bush have no appreciation for one of the great presidents in our history." - Ned
              "I wish I had gay sex in the boy scouts" - Dissident

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              • #8
                Well, to be perfectly accurate, many of the big guys prepared the securitized packages for those who originated the loans, so their hands aren't clean. You're right that f.e. the Japanese banks appear to be only investors.

                It would be a bail out for all these folks.
                I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891

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                • #9
                  Oh, I wouldn't suggest for a second that their hands were clean. I'm not sure I'd put buying **** securities en masse even half a notch above making **** loans.
                  "The French caused the war [Persian Gulf war, 1991]" - Ned
                  "you people who bash Bush have no appreciation for one of the great presidents in our history." - Ned
                  "I wish I had gay sex in the boy scouts" - Dissident

                  Comment

                  • #10
                    What harm would be done to the economy if:
                    a) These banks were forced to stop lending nearly at all due to overly low cash-on-hand levels?
                    b) These banks went bankrupt?

                    If 'none' or 'relatively little' is the answer, then definitely no bail-out.

                    If 'lots', then something needs to happen to protect the 'little guys', no? I'd be fine with something that massively penalized these banks ...

                    Perhaps nationalizing any bank that is going to go under as a result
                    <Reverend> IRC is just multiplayer notepad.
                    I like your SNOOPY POSTER! - While you Wait quote.

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                    • #11
                      Originally posted by Oerdin
                      The rebate checks won't work. If we have big banks failing because of this then the government will have to do something eventually and sooner is usually better then later.

                      I just hope dunderhead Republicans remember that a lack of responsible regulations is what got us into this, just like in 1987, and maybe next time they won't be so knee jerk against needed regulations.

                      There is nothing that can be done to save this, and no one was going to shut it down. The housing boom fueled by this was one of the really bright spots of the economy in the last decade, and there is no way that anyone was going to stop it.

                      Comment

                      • #12
                        Everyone believes in the Free Enterprise system except for capitalists.

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                        • #13
                          I wud like to be bailed out plz. Can I has $20billion?

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                          • #14
                            Originally posted by Aeson
                            I wud like to be bailed out plz. Can I has $20billion?
                            I don't have that much, right now. Once I get my bail out money, I'll give you a cut.

                            Comment

                            • #15
                              Originally posted by Zkribbler


                              I don't have that much, right now. Once I get my bail out money, I'll give you a cut.
                              less QQ and more pew pew (I mean $$)

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