Bailout is actually more than $700bn

[Aeson]

From the article I posted:

Bloomberg News has requested details of the Fed lending under the U.S. Freedom of Information Act and filed a federal lawsuit Nov. 7 seeking to force disclosure.

Bloomberg

[Kidlicious]

dp

[OneFootInTheGrave]

that will be fun fun fun... I have a feeling... unless they get away somehow with national security or some such "issue"

[Kidlicious]

I think they could make an executive order exempting this imformation for that reason, but then that would create some news about this, and I don't think they want that. Of course the only thing that can stop them is public outrage.

[KrazyHorse]

Originally posted by Aeson


First of all, you're still ducking the issue.

I'm not ducking any issue. I honestly still haven't decided if the idea of the Fed becoming a pricer of risk is a good one. I'm not arguing for or against it. I'm clarifying the issue and correcting several egregious misconceptions about the bailout.

Doesn't it concern you that >$1trn (in less than 2 months) has been appropriated/printed/whereverthehellitscomingfrom with no accountability as to what it's being used for?

Not my money (probably). Also, is this level of disclosure any different from that practiced in lending at fed funds rate.

We don't know to who these loans are being made (other than the portion for F&F), or what is being used as collateral. For all we know the Fed took you up on your offer to take that $700bn, and you gave them a poly+ membership as collateral. (Is this why you seem so happy about it? I had a rock I was willing to offer as collateral for $30bn last year... I'm not greedy... but no skipping in line!)

I'm not particularly happy about it. You have vastly miscalculated my position. And yes, the 700 billion is nice.

But as for "getting around asking Congress for more money"... that's circumventing the US Constitution

eh

I don't agree that the federal government should be doing this (in this manner). I'm all for letting failures fail, and if we have to, we can restructure them after bankruptcy and then sell them back onto the market (and/or replace them). Saving failures is promoting failure, or rather high risk of failure (with high returns)... not a good policy for our future.

I'm not sure that moral hazard arguments are as strong as you think they are in this case.

Congress can have oversight of how much is budgetted (as per the Constitution)

How much is budgeted for the FOMC?

With better policy makers running the show though, we could be better off with the assets, since we could require the good stuff

No, unless you're claiming that the federal gov't has better evaluaters than the market as a whole.

[Aeson]

Originally posted by KrazyHorse
Also, is this level of disclosure any different from that practiced in lending at fed funds rate.

I honestly couldn't say. But given the level of funding they're throwing out, someone should know what the hell they're doing don't you think?

I'm not particularly happy about it. You have vastly miscalculated my position. And yes, the 700 billion is nice.

ingrate

(can I has sum plz?)

I'm not sure that moral hazard arguments are as strong as you think they are in this case.

It's not all I'm relying on, as there very well may be problems with what is going on specifically, not just the concept of transparency itself. As for moral hazard, all I'm saying that even if hypothetically there's nothing fishy going on, it's a bad idea to let a trillian+ go without knowing what you're getting.

You can't honestly tell me that if it was a trillion+ of your money you'd allow it to be lent out without your knowledge of what was the collateral and who the debtor was? No sane person would. Why is asking similar sanity from my government a bad thing?

How much is budgeted for the FOMC?

Last year I think it was somewhere around $800bn, and they had most of that allocated (at times slightly more than that IIRC... usually they had ~$30bn in reserves). I haven't heard of a move which gives them the other $trn+... you'd think something like that would make news, but I guess we're more interested in Palin not knowing Africa is a continent...

No, unless you're claiming that the federal gov't has better evaluaters than the market as a whole.

It was a hypothetical. I clearly stated that we could not expect that level of competence.

There are people I would expect to beat the market as a whole. That's not to say they definitely would, but some do have track records that suggest they could. At the very least we should try to get as good of a deal from GS as Buffet got (for example). There's really no point to giving money away for less once the market has been set. Instead we're undercutting the market (against us), which no matter how good an evaluater you are (or aren't), is just stupid.

[KrazyHorse]

Why is asking similar sanity from my government a bad thing?

Because if Congress gets its hands on any part of the oversight they will **** it up. Right now the Fed and the Treasury are pulling an end run around congress. I'm not sure I trust them to do this properly, especially as they're making things up as they go. I do trust Congress to **** **** up massively.

My point is simply that if we're going to allow the Fed to price risk then they need to be given carte blanche to do it.

I'm still not sure it's a good idea, overall. But leaving Congress in the dark for now is the only way to get it done at all properly (if that's even possible).

[Kidlicious]

Originally posted by KrazyHorse
I honestly still haven't decided if the idea of the Fed becoming a pricer of risk is a good one.

Hell no they aren't a good pricer of risk. That's how we got into this mess. They couldn't see the risks involved.

[Aeson]

Originally posted by KrazyHorse
Because if Congress gets its hands on any part of the oversight they will **** it up.

It's better than allowing thieves (or potential thieves if you like) to do whatever they want with the Treasury. (Even if it's in the Fed, the US Gov is still liable for any losses. Not to mention that we're all affected by their policy in various ways.)

Right now the Fed and the Treasury are pulling an end run around congress. I'm not sure I trust them to do this properly, especially as they're making things up as they go. I do trust Congress to **** **** up massively.

I don't trust Bernanke and Paulson anymore than Congress. Paulson's track record on F&F over the summer is all that's needed to show he's incompetent (or worse).

At least Bloomberg has some common sense. Let the information be known so the press, special interests, and the market can keep them in line if they try (or are doing already) anything shady(...er than usual).

I fail to see why you have a problem with this. Congress are chumps and have already shown they'll just follow along blindly... if they have oversight, it gives citizens (or rather powerful enough special interests) recourse though. Right now the only special interests with a say in the matter are the ****wads who created the mess. (Be they still at their financial institutions, or like Paulson and some of the Fed, serving in government.)

My point is simply that if we're going to allow the Fed to price risk then they need to be given carte blanche to do it.

I doubt you mean "carte blanche" in a literal sense.

[Kidlicious]

Boomberg tried to contact Obama, and he didn't get back to them as yet.

This looks just dirty as hell to me. I don't see how anyone can trust anyone involved including the banks, fed, treasury, Congress, Bush or Obama who recieved $25m in campaign contributions from the financial sector.

[Kidlicious]

The fed's argument is that the loans are made through the Fed New York which doesn't fall under the FOIA.

[notyoueither]

Originally posted by KrazyHorse


What happens when that politician economist has apparently forgotten all of his economic training (GST cut and refusing to countenance a carbon emission tax instead of cutting income taxes)?

So now regressive taxes (GST) are good economics according to the commies of the world?

He was against a regional wealth transfer tax under the guise of a carbon tax. I'm not sure what makes such a tax the the only good emission reduction plan.

[notyoueither]

Originally posted by Velociryx


Well yes...obviously this is a valid reason to just nix the tax altogether and not talk about where we make up the shortfall.

Face it NGR, the argument doesn't hold.

-=Vel=-

EDIT: Doesn't the WAY in which this extra little tidbit was introduced provide some sort of clue? I think yes, but again, this is just IMO.

What if cutting taxes on mergers saved bailout dollars?

The initial reaction strikes as a lot of knee-jerkedness to me.

[KrazyHorse]

Originally posted by notyoueither


So now regressive taxes (GST) are good economics according to the commies of the world?

a) I'm not a commie, nor have I ever been one. I'm not a socialist any more either, if you'd like to know.



b) I don't have a problem with redistributing the tax as a lump-sum payment per capita. Would take the sting out of regressiveness. GST is a better tax than income tax is, expecially as currently implemented.

He was against a regional wealth transfer tax under the guise of a carbon tax. I'm not sure what makes such a tax the the only good emission reduction plan.

NYE, there is good reason to believe that carbon emissions contain an externality (global warming) which is currently priced at 0. The efficient solution is to internalize this externality by use of a Pigovian tax. If you want to alleviate supposed regionality then you should suggest decreasing transfer payments in coordination with introducing carbon tax. Most reasonable economists who have weighed in on the issue believe that such a tax is the optimal policy solution to global warming.

[Kidlicious]

NYE,

No. They aren't saving any money. They're just pouring it on as fast as they possibly can. This is ****ing unbelievable.