What do you all think about taking equity form the companies being bailed out? Or have them mark down the junk securities, and take loans from the treasury if they become illiquid or threatened? (ideas from Peter Defazio http://www.youtube.com/watch?v=ANGsBNMY1_c )

Can someone explain why Paulson requires all laws are waived, that there is no oversight, no conflict of interest rules, no court review? I don’t see any legitimate reasons for that. Maybe he’d claim that other people are not capable of seeing the right path so he has to force this through to save the economy.

Martin, I see how the bail-out could benefit the taxpayers, but how would Paulson fail at favouring the rich? Are you suggesting a win-win scenario?

Surely we all agree that there need to be consequences to this. How are these changes going to be incentivised or enforced? For example, Martin, in your other post you said “traders should have built their hedge funds and not gamble with the whole investment bank.” Do you think this and other changes will come by without the state taking equity assurance or extending loans to these banks?

PS. Defazio claims that with the Paulson plan, the taxpayers will, at best, break even.

Thank you,
Javier

…they are failing at everything they tried to do including favoring the rich.

LOL

I am not saying that the Bush administration, who has consistently favored the priviledge is now trying to change. I am saying that they are failing at everything they tried to do including favoring the rich. Indeed many rich are quite worse off thanks to their mistakes. And now with this massive nationalization that is about to take place the Bush administration is reluctantly becoming extremely interventionist.

On May 30 2008, Richard W. Fisher, head of the Federal Reserve Bank of Dallas, spoke in front of the Commonwealth Club of California. In his speech at the club, Fisher remarked that the unfunded liabilities from Medicare and Social Security adds up to $99.2 trillion.

Please see http://intelstrike.com/?p=263,

As for CDSs, they were created by Wall Street almost ten years ago. They now total some $60-65 trillion and in aggregate are some multiple, and growing, greater than the combined net worth of the world. This is all over the net, you can easily do a Google search. Example:. http://seekingalpha.com/article/96332-activity-in-cds-market-works-in-the-fed-s-best-interest?source=feed

As for the propsoed measures by Mr. Paulson, it gives him complete control of all financial institutions in the US, with no accountability.

“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.”

We can only hope that sanity will prevail in and Congress will rein in the Treasury Secretary.

Please read below the text of the proposed measure along with comments, as well as a video that explains it (I have nothing to do with this person).

http://market-ticker.denninger.net/

This has nothing to do with the poor ot giving back to the citizens, this has all to do with saving rich people. It is a sad history-changing day. By the way, the FED is a private, not public, entity.

William I don´t agree with your figures but I agree with your thinking that Paulson, Bush, do not want to transfer wealth from the rich to the poor. What I am saying is that unwillingly they are presiding over the biggest nationalization in US history. What is going on here will redefine the role of government. A party that was elected promoting small government is now making government´s role huge.

We are beyond the point of no return. These $700B won’t make a dent on the $65T of credit default swaps or on the $99T of unfunded liabilites of the US government.

BTW, these people you defend (Paulson et al) own many billions of dollars of stock of GS/MS/C/WB/etc. Do not for a minute think they are trying to give to the poor.

“And I want to thank you, Mr. Secretary, for working over the weekend. You’ve shown the country and the world that the United States is on top of the situation. Secondly, you’ve reaffirmed the fact that our financial institutions are strong and that our capital markets are functioning efficiently and effectively.” – George Bush 3/17/2008″