The Bush Adm. is trying a rush job ... Hey, it worked with the Iraq War and the Patriot Act, so why not try again? Just sayin' ...

Anyone just catch Paulson on MTP? Brokaw asks about 'the fundamentals of the economy' and his response sounds like he is stumping for McCain (fundamentals = American people)

What a joke.

Pay for all $700 billion with a tax hike on the richest 1%, suddenly I have no problem with this monstrosity.

one other criterion of acceptability ought to be this: if the bailout plan is going to cost us money, forget about it. We should step into the financial dung heap only if, in the end, we make money out of the deal.

it is better to boost the banking system by increasing its capital than by reducing its loans

Give the junkie more junk.

tell banks to cancel all dividend payments

Won't that reduce legitimate capital, thus reducing banks' ability to lend money to make even good loans?

Whereas it's horribly complicated to value bad loans, banks have share prices you can look up in seconds, so government could inject capital into banks quickly and at a fair level.

Huh? If you can't value the loans, you can't value the banks' true value. Thus adding capital is merely letting the same people manage more money with the same rules.

Conclusion: They need to change the rules, before they add more money. And confidence will only be restored when accountability is factored into the equasion.

We should do what Japan did in the 1990s, which is effectively nationalize the banks. The Japanese wiped out the exisiting shareholders and then used public funds to renew their capital. The banks were then nationally owned. Eventually when their operations recovered, the shares were sold to the market for a profit. The taxpayers ended up getting their money back and some.

The current proposal is absurd. The public will pony up the money for nothing, not even assurance that the plan would work. The idea that these financial institutions will pay dividends is ridiculous, this absolutely should be forbidden.

Also, Bush and Cheney should resign to take responsibility for this mess. I know there are only four months left to their terms, but this should be done as a matter of principle. This happen during their watch, despite many warning signs.

But we all know that current Dem leadership is utterly spineless. They will cave in. Obama will support this piece of crap. McCain will take a populist stance and oppose it, resulting in a surge in the polls.

The Dems will once again be hurt by their unwillingness to fight for the people's interest, while the elitist GOP bamboozles the Ameerican people yet one more time.

The United States is trapped between a very big rock and a very hard place.

Ponder this concept: Osama bin Laden has won.

He envisioned the "US Colossus Mired with one foot stuck in Iraq and one foot stuck in Afghanistan". Bush blundered straight into the trap Osama had set, turning Osama into one of the most brilliant strategists in the history of the planet.

The US blew a trillion bucks (give or take a couple hundred billion) on a war against an imaginary threat. While not the sole cause of the financial collapse, burning a trillion or so in unfunded wars is certainly a major factor... and that sort of money would certainly 'come in handy' right now.

Methinks the 'Bush Presidential Library' may end up being a double-wide in a trailer park.

Something in this package should address the foreclosure problem. With a foreclosure, everyone loses, and still another toxic property is dumped onto the depressed real estate market.

Congress should address the problem directly by helping overstretched homeowners to make their payments and to stay in their homes. That will increase the value of Wall Street's bad paper, and help to firm up real estate prices.

It would be better for everyone concerned if the terms of many of these mortgages could be renegotiated - adjusting the principal to equal the value of the collateral, or adjusting the interest rate to market rates, or both.

The Administration and Wall Street are asking for, and expecting, a $700 billion bailout in the form of a purchase of their mistakes by taxpayers. We can solve the problems in the credit markets in a better way than that.

Are reasonable folks really surprised that this "deal" smells rotten?

Wealthcare.

Why do you think I've been calling it that? It's not about putting country first, it's about burdening taxpayers with a "bill" that is beyond comprehension.

Look at the behind-closed-door aspects of the past few days. The money changers and top level administrative folks want the new agency to be
up and running by 10/1/08. That's 10 days from now.

It's similar to the "mushroom cloud" scenario we were sold before the Iraq War. We have to do it now.

Hold on folks. We need a public debate about Wealthcare, since we'll all be paying for it.

Maybe Obama should start using the term until we can be clear just what the deal means.

Global financial meltdown. Our very way of life threatened. Wealthcare to the rescue. Sounds/smells like more of the same old same stench wafting up from canyons and corridors of power.
Posted by: Tom Nicholson on September 21, 2008 at 9:56 AM | PERMALINK

''We need this to be clean and to be quick,''
(Paulson)

Shock and Awe.

The time for diplomacy is over. Operation Iraqi Liberation.

We gotta go forward with this plan now. Wealthcare
Posted by: Tom Nicholson on September 21, 2008 at 10:15 AM | PERMALINK

So how're we doing in the Worst President Ever contest?
Are we there yet?

The critical thing is not to give direct subsidies without getting anything in return. With the S&Ls our government owned them as did the Japanese. The government will own AIG if the shareholders don't find a new source of funding.

Sadly, the executives who raided these companies and treated them as their own little piggy-bank often have scuttled with the money. Any bank that receives any bailout should be required to recapture all performance bonuses from the past five years because the executive defrauded the bank by taking on more risk than was contemplated in the performance bonus.

The thing I notice from Paulson's MtP interview is that he keeps saying "it's better than the alternative." What alternative? He seems to imply that we either do what he wants/proposes or we do nothing. I agree that doing something is better than doing nothing in this case, but clearly there are several possible "something"s we could do. This particular "something" is scary to me.

I can't help but compare this to the movie "Dumb and Dumber" with the Fed Chief and Treasury Sec playing the main roles.

After a desperate cross country trek where they repeatedly squandered what little money they had, they discovered a briefcase filled with cash. They spent the money quickly and replaced it with IOUs.

The money was a ransom, given up at gunpoint.

Somehow I'm not buying that things are as bad as they sound. The main issue appears to be the time mismatch between money flows and Chapter 11 bankruptcy.

But the bailout sounds guaranteed to put the spending in the hands of Dumb and Dumber, where they decide who gets how much. And the most will go to the worst offenders, at least in proportion to the company value.

For companies on the verge of failure, it seems like the government should step on and make them a deal they can't refuse, not the other way around.

A fourth idea.

Future bailouts (it's probably too late for this one) should be married to anti-trust legislation. When corporations are "too big to fail" doesn't it make sense that those in charge of a company that WOULD fail without our help should be made small enough to stop being a threat to our economy?

The likes of Bear Sterns, Fannie Mae, Freddie Mac and the dozens of others that will follow, no doubt, should be forced to break into multiple smaller companies that will not be indispensable should they choose risky paths likely to lead once again to their self destruction. If this is not an acceptable state of affairs for the corporation receiving assistance, then the economic distress clearly is not sufficient enough to merit taxpayer sacrifice.

The more things change...

"The Money Power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy. It denounces, as public enemies, all who question its methods or throw light upon its crimes." ~ Abraham Lincoln

Call your Senators and Congresspersons.

This is nothing but history repeating itself.

Hoover offered FDR the chance to run the country before he was inaugurated if only he would not do the NEW DEAL. FDR said NO.

NO DEALS! Don't prop up failed banks, protect the American people!

Bailout no - Buyout yes.

The United States Government is capitalizing on a comprehensional failure of the human mind – the inability to fully grasp the magnitude of large numbers. Upon hearing numbers beyond a few thousand our brains interpret it as, “Wow, that’s a big number!” with no tangible image to relay exactly how big. So, let’s start with a One Dollar Bill. We can understand $1.00, right?

According to the United States treasury, a One Dollar Bill has a thickness of 0.0043 inches. One thousand One Dollar Bills would be one thousand times thicker -- 4.3 inches.

One million is one thousand thousands, so the thickness of $1,000,000 is 4300 inches. Converting to feet and this becomes 358.3 feet, an American football field.

One billion -- $1,000,000,000 is one thousand times thicker still or 358,333.3 feet. This is 67.866 miles, the driving distance from New York City to Milford CT.

One Trillion is one thousand billions – one trillion One Dollar Bills stacked one on top of another is 67,866 miles. This would circumnavigate the globe 2.73 times.

The proposed 700 Billion Dollar bailout alone would be a stack of One Dollar Bills stretching 47,506.2 miles, or 1.90 times around the globe.

A stack of One Dollar Bills totaling the current national debt cap of 10.6 trillion dollars would go around the equator 28.93 times. The proposed cap of 11.3 trillion dollars would go around 30.85 times.

Is creating a debt that is the equivalent of a stack of One Dollar Bills rounding planet 31 times a responsible act?