September 20, 2008

Let me be succinct. America Inc. nearly failed this week. The US economy nearly fell into a Great Great Depression. We are at the precipice.

And we made it through the week, thanks to the desperate and illegal actions of Hank Paulson, Chris Cox, Ben Bernanke and George Bush.

The most desperate of times called for the most desperate of measures. Even if those measures were illegal. Like robbing a pharmacy to get life-saving drugs.

And now, we'll see a taxpayer-funded bailout of the banks and mortgage gamblers in the trillions, again to stave off a Great Great Depression. It may work.

Or it may not.

And all of this will be without an independent Congressional or criminal investigation. America has been taken over by corrupt interests, enabled by incompetent fools, powered by a subservient media, greased by realtors on commission, elected by ignorant voters.

I'll write more later on what just happened and what is to come. For now, what I want you to consider is that America Inc. nearly failed this week. Every job, every investment, every pension, every 401k, every dollar bill, every company, everything was on the line this week. Your financial and physical safety. Your family's financial future.

We were on the cliff's edge. Taken there by bonus-driven bankers and bribery-influenced politicians.

And we're still there folks. This isn't over. We're still there.

Congressional Leaders Stunned by Warnings

“When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

When Mr. Schumer described the meeting as “somber,” Mr. Dodd cut in. “Somber doesn’t begin to justify the words,” he said. “We have never heard language like this.”

“You have the credit lines in America, which are the lifeblood of the economy, frozen.” Mr. Schumer said. “That hasn’t happened before. It’s a brave new world. You are in uncharted territory, but the one thing you do know is you can’t leave them frozen or the economy will just head south at a rapid rate.”


Anonymous said...

Shock Forced Paulson's Hand
A Black Wednesday on Credit Markets; 'Heaven Help Us All'

When government officials surveyed the flailing American financial system this week, they didn't see only a collapsed investment bank or the surrender of a giant insurance firm. They saw the circulatory system of the U.S. economy -- credit markets -- starting to fail.

Huddled in his office Wednesday with top advisers, Treasury Secretary Henry Paulson watched his financial-data terminal with alarm as one market after another began go haywire. Investors were fleeing money-market mutual funds, long considered ultra-safe. The market froze for the short-term loans that banks rely on to fund their day-to-day business. Without such mechanisms, the economy would grind to a halt. Companies would be unable to fund their daily operations. Soon, consumers would panic.

For at least a month, Mr. Paulson and Treasury officials had discussed the option of jump-starting markets by having the government absorb the rotten assets -- mainly financial instruments tied to subprime mortgages -- at the heart of the crisis. The concept, dubbed Balance Sheet Relief, was seen at Treasury as a blunt instrument, something to be used in only the direst of circumstances.

One day later, Mr. Paulson and Federal Reserve Chairman Ben Bernanke sped to Congress to seek approval for the biggest government intervention in financial markets since the 1930s. In a private meeting with lawmakers, according to a person present, one asked what would happen if the bill failed.

"If it doesn't pass, then heaven help us all," responded Mr. Paulson, according to several people familiar with the matter.

Betty said...

Mr Market will not be denied, the die has been cast. All bets are off on supports, SPX to 750 and a break of 10000 confirms a move to 6000. No wonder the PPT out in force.

Bettex said...

Mr. Market will not be denied, the die has been cast. SPX headed to 750 a break under 10000 confirms DOW to 6000. All bets are off on supports in a bear. As for wallstreet let them burn, biggest bunch of crooks, some free market sytem. What a bitter irony that we turn socialist under the republicans.

Anonymous said...

Now wait,lets not confuse how to handle credit loses with how to
provide credit at a time when it's not flowing very good .

Don't ever confuse "old money" with "new money". Old Money is a loan that has already been tied up and made and has a term and is being paid by term payments . "New Money" is a loan that needs to be made to keep credit markets going .

Paulson wants to bail=out the old
money toxic waste loans . These loans would of been tied up for a long time anyway because they were long term loans . The fact that banks are getting big loss on the loans is the issue of who pays for the loss .

New Money loans have only been log-jammed to the extent that the normal credit markets have cracked down on giving easy money ,so people have to qualify . The fact that the Banks are more prudent in even giving short term loans is a byproduct of what banks do when credit is risky . To extend credit ,when credit is risky is not wise .

When recessions are operative ,lenders and creditors always pull back and don't take as much risk .

The fact that nobody wants to give easy money anymore is a good thing,not a bad thing ,in spite of Paulson wanting easy money .

The Feds had the ability to provide prudent loan money for mortgages through F&F if the mortgage market got to tight. In fact ,the Housing Bill provided for some of that and the takeover of F&F gave the gov. the power to use F&F to give loans or buy loans.

The fact that some Savings and loans and investment firms would of been bought out and some would of failed is a function of the market and of course there would of been winners and losers ,but FDIC would of paid the bank customers up to 100k .

American did not nearly fail this week,but corrupt Companies that have bad balance sheets nearly failed this week,as they should . Now because of these bail-outs ,the only losers are the taxpayers .
I have never seen any proof of
the system failing this week ,but I see a lot of proof that a number of Corrupt banks and Investment firms would of been bought out or would of failed this week .

Anonymous said...

Oh this is bunk, The Fed Chairman was providing short term loans for day to day function of the banks at a cheap price .

keith said...

I think all this has to show is that if you trust your government, you'll be no better off than those people at the Superdome

When voters elect morons, they get what they get

Anonymous said...

I have no proof ,especially when
the Feds were providing cash for banks for daily functions ,that every thing would of failed . Sure some
Corrupt banks and investment firms would of failed or been bought out ,but that is to be expected .Why should people invest in corrupt firms that put their money at risk anyway,or have bad balance sheets. . Paulson could not take the heat of the market correcting itself .

The truth is that all these corrupt firms have been just holding out for the big bail-out ,because they could of one by one done what it took to take their losses . I can't help it if they kept waiting for the big bail-out or for real estate to go up again

The corrupt firms forced Paulsons hand instead of Paulson forcing their hands . It doesn't help to have people like Crammer causing panic by saying that Great Depression II was certain unless Paulson and the Feds acted in the interest of the blackmailers .

I would like to know why it is acceptable for a Business news program to allow one their people who has a show(Crammer) to yell fire in a movie house when there wasn't one.

Anonymous said...

Keith ,why would you trust these leaked on purpose statements from Hank Paulson , the Fed Chairman, the Corrupt Congress and Senate ,and the whole gang .

For the last year and one half ,all you heard from these liars was that the economy was strong bah bah bah ,when they knew that the bad loans were causing problems .

Now the PR campaign is to say that everything is in dire straights and extra ordinary bail outs are needed as a emergency .

You see ,Paulson and the Feds are evoking the emergency power clauses,to pull off their bail-outs ,so its has to be perceived as a emergency . Otherwise corrupt companies going out of business are not typically considered a emergency that deserves public fund bail-outs .

Its really rotten what they are doing .

Michael said...

If you want someone to blame than read this:

Nick said...

Keith, quit your crying. Honestly, quit your crying. Now that the federal government owns many of the bad mortgages (like the one I hold in which for eleven straight months I haven't paid a dime). The next step is "a loan modification" in which a person who bought a house for 799K will see their mortgage balance go down to perhaps 250K!

Well you HP'ers had the choice of joining the party or not. You decided not to join the party. Thus you will end up paying for it.

Nick said...

I just want to tell my fellow Americans that if you are a honest person, then you are a SUCKER. If you believe in the rule of law, then you are a SUCKER. If you live below your means, then you are a SUCKER. If you believe in self-responsibility, then you are a SUCKER. If you are a HP'er, then you are a ???? (you guessed it, the S word).

mickeyc said...

I am thrilled that the unwind is being handled in an orderly fashion. It makes the profit opportunities that much better.
I am one of those evil short sellers but even I am distressed by huge drops. I want the system to work so I can get paid!
Please someone jump in who has no idea of capital markets and tell me why short selling is bad.

Anonymous said...

I would like to know why it is acceptable for a Business news program to allow one their people who has a show(Crammer) to yell fire in a movie house when there wasn't one.

And yet you will hear the morons on this site continue to single out Fox News and only Fox News:

Networks biased toward Republicans: Fox

Networks biased toward Democrats: CBS, NBC, ABC, MSNBC, CNN (Cramer's home), PBS, et al.

Any questions? Methinks HP has become just another extension of the MSM now.

Anonymous said...

Fake a emergency so you can evoke emergency powers is a age old trick .
Goldman Sachs and Morgan Stanley getting mad that they were being affected stock wise by the other financial sectors are not emergency grounds for trillions of dollars of
bail-outs and a suspension of the short selling .

WaMu being bought out by a stronger bank is not a emergency ,its how markets work.

Lehman going under (because it was the toxic waste of toxic waste places ) as far as investment firms went ,is a public good .

AIG had some good business ,but their one big gamble business of credit default swaps was taking them down . That Company wanted a loan ,but it had not been a function of the Feds or treasury to rescue Insurance Companies .Now I can't help it that AIG took a big risk and took insurance risk
on dumb loans to make a big bucks that they never thought they would have to pay off on . Well anyway,the fact that the Feds gave them a big loan to give them time to cover their bets by selling out assets etc, was done ,and I'm not going to quibble about it.

My point is that when the real market decides to punish companies for their bad decision or greedy decision ,it's not the government that has any business interfering with that process . The gov. giving bridge loans for a orderly BK ,or time to sell out assets ,might be acceptable ,but out right bail-outs ,no way .

Now you watch AIG will be crying for a new deal ,now that the broad-based bail-outs are on the table .
Oh by the way ,in April of 2005 there was a SEC investigation on AIG that they were cooking their books ,that they denied of course

Andrew Hac said...

Aaaaarrrrr, Aaaaahhhhh, Ooooohhhhh.

Americano, the land of the Great Snapper Turtle.

What can one say when watching the mouth-watering scene of the obese, the Burger-King belly, the Coke-Drinker diabetics, the divorced-three-times mother, the greedy, the immoral, the sell-your-mom-for-a-buck, Americano being toasted slowly as a roasted armadillo skewered from mouth to ass, all sizzling, fat popping, juices oozing with melted golden fat over a bed of white hot charcoal.

That is such a fate for the UNJUST...

Yes, it is the time to pay the Piper for that Wild-Wild-West Housing Bubble Party last night. Add in the maxed out CC debt, the home equity extract, the I-ain't-got-a-job-now moaning and lamenting, the spend-like-there-is-no-tomorrow mentality of the Americano, the oversize chicken barn SUV, the run-down-the-cow F250 pickup truck and the Americano is now having a handful of shits, pukes, and hangover biles to deal with. $200.00/barrel of oil in New Year 2009's... It is coming and it is coming right soon...

But worry not, my dear fat-ass buckteeth Americano, Dubya Shrub will lead you through the dark, ominous, pee-in-the-pant time. He has to, he has no choice, since the dim nitwit Americano voted for him 2 terms in a freaking-ass row. Yes, it is fittingly beautiful: "The head turkey leads the horde of wacka-doo-doo, BORKAFATTY, blind turkey down the gutter...".

Now, a little verse from the "Man With The White Beard" to cheer things up for the horde of Snapper Turtle, Porpoise, Armadillo, Raccoon, Opossum, Porcupine, Skunk, and "BORKAFATTY" AKA :::The Pig:::

Psalm 23:4

"Yea, though I walk through the valley of the shadow of the Housing Bubble,
I will fear no foreclosure:
for Dubya Shrub & Penis Shooter art with me:
thy bail-out and thy rebate-check, they comfort me."

Anonymous said...

So I've been thinking about the implications of that move from The Monkeys In Charge. And here are my thoughts:
-The "Plan" only affects American banks. So banks all over the world holding toxic papers aren't saved at all.
-As this plan adds to America's debt, only two outcomes: pay more interest on the debt, or drown it in inflation.
-The relief from the banks will allow them to lend money again to clueless americans, which will fuel a new bubble. Best case bubble would be real estate again, as it would help Treasury's situation with its newly acquired housing industry.

So on these assumption, here's an attempt of a forecast:
-As countries around the world awake to point 1, their government issue similar moves, adding to their debt, or sell their I.O.U.s(mostly USD denominated assets) to bail out their financial institutions.
-At this point, the FED is already pumping up inflation as indicated in point 2. Problem: Other countries are also deperatly trying to sell their treasuries, adding to the newly issued paper.
-Here it all comes down to how much of this toxic loan mess went oversea, which nead bailout type operation, and we have absolutely no clue as to how much it amounts for, and how much leverage has been applied to it.

After that it's the Great Unknown, but mostly, countries already in debt end up in inflationary scenario, those with enough resources dry up their reserves but save their currency from doom. Expect wild moves on currency and treasury markets. Stock market doesn't mean anything anymore, if that ever was the case. It may go fine, but the patent case of panic expressed last week by Paulson and Bernie, and the history of America making the World pay for their failures, make me think it won't.

Anonymous said...

Communism and socialism failed and so did capitalism.... The only reason this economy is surviving is because we are borrowing from the future. "Eliminate Usery"

Anonymous said...

In response to the panic of credit lines frozen ,isn't that what the banks wanted to do to stop the borrowers from taking out more debt than was reasonable ?
Not only have some credit lines been frozen for these equity junkies ,but
in many cases their credit cards limits have been reduced . This is not a National emergency ,this is what is suppose to happen after to much debt has been taken out in the past .

I guess these Bozos have never seen a contracted credit market that is a good thing . I guess emergency to these bozos is anything less than easy money ,give anyone a loan and buy buy
buy ,to make the economy look good .

Why don't these clowns start working overtime to try to create jobs for the American people .But that would take some brains ,and these people can only be bribed .

Anonymous said...

Man, you americans are screwed big time... Just think on the tax rise to pay for these bailouts.

The dollar will be worthless pretty soon, something like turkish liras...

Oh and your congress people are pretty naive, getting scared with the big bad wolf stories and such (altough Paulson gives the creeps)...

les said...

Credit lines frozen? They must mean cheap credit lines are frozen.

If a bank fears that a prospective loan is risky, can't they simply raise the interest rate?

Can't corporations issue a bond at a higher rate of return in order to get funding?

Can't banks offer higher dividend rates to savings accounts to attract more depositers?

There is a lot of cash out there. A lot of money is resting in commodities, such as, gold. People are holding it because no one is offering them a justifiable return on their investment. Most savings accounts pay a dividend of 1-2%, which is almost insulting.

Anyways, I'm sure that the average congressmen are dumber than the average HP'er. It was probably an easy con for Paulson and Bernanke to pull.

area51 said...

Have to totally agree with Nick.
Now I think I'm just going to load up on debt, move it out of the US and then quit repayment. The govt. will mop up the mess. Taxpayers? They are illegals or other SUCKERS.


Even Greenspan said the ban on shortselling was "a terrible idea".

For once I gotta agree with him.

But don't fret, you can still short some stuff, and rest assured, now there is no cover support for the next down day so prepare for a -800 DOW day soon.


Also gotta agree with anon 10:26.
The frightened and terrified leaders listened to a scary campfire story and might just have guaranteed and long bout of economic malaise in the US.

Anonymous said...

Oooh, oooh, financial meltdown coming, folks!!! The end of the world is near!!! There's only one way to save us - quick, transfer a few trillion dollars from the taxpayer to big corporations and wealthy investors!!! Quick, quick, before anyone has a chance to think about it!!!


People got mortgages and businesses got loans years before Wall Street was involved. If the big banks, brokers, and investors go under, it will only be a blip in our nation's history. Life will go on, believe me.

You are just witnessing the greatest fraud and theft of all time. Bravo to the greedy leaches who pulled it off, and raspberries to the poor hardworking taypaying saps who didn't even see it coming. Suckers will always be suckers. Deal with it.

Paul E. Math said...

"the run-down-the-cow F250 pickup truck"

That's a good one. Thanks Andrew.

Anonymous said...

Focus on what is really happening. Read your history Books, read the bible.
Look back at George Sr. comments on New world order and many other leaders including Tony Blair.
This is interesting.
I have read articals in the last 10 years predicting what just happened. This is not about forclosures in America or CEO's bonus this is planned from day one.
I don't think we can do anything but pray.
Dr. Carroll Quigley, Bill Clinton’s mentor at Georgetown University wrote about the purpose of central banks in his book, Tragedy and Hope:

[T]he powers of financial capitalism had another far-reaching aim, nothing less than to Create a world system of financial control in private hands able to dominate the political system of each country and economy of the world has a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements.

Anonymous said...

Anybody want to hear the truth?

yoski said...

Who and how is going to pay for this?
-"Now because of these bail-outs ,the only losers are the taxpayers "
-"Just think on the tax rise to pay for these bailouts."
The income tax will probably go down in the next administration.
This bailout will be paid for by the printing press. There's really no other option. So the people footing the bill for this mess are owners of dollars. Before too long suckers around the world are going to catch on. The U$ will lose it reserve currency status and our currency won't be genrally accept for payment to finance our trade deficit. Think oil $200+ here and all that goes along with it. Many dollars from overseas will be flooding back home. We will get hit by inflation like this country has never seen in its history. Don't expect much pay raises either, at least not enough to keep up. The net result will be a decreased standard of living and a poorer nation. The rest of the world will be deeply suspicous of us. Fake reasons for the Iraq war, financial shenanigans of balance book keeping. Foreigners will quit funding our spending spree. You want oil? What do you have to offer? Airplanes, drugs, anything other than debased currency and toxic waste from Wall Street?
What should you do? I am buying bullion PM, stocks in consumer staples, industry, commodities and energy. Get out of the dollar while you can. If you're holding dollar you are going to pay for this bailout. As an additional hedge it might be wise to take on some fixed rate debt, like to buy a foreclosure for example. But remember, you have to be able to service that debt in difficult economic times ahead.

Anonymous said...

I just want to tell my fellow Americans that if you are a honest person, then you are a SUCKER. If you believe in the rule of law, then you are a SUCKER. If you live below your means, then you are a SUCKER. If you believe in self-responsibility, then you are a SUCKER. If you are a HP'er, then you are a ???? (you guessed it, the S word).


I can't tell if you are rubbing our noses in it or not, but I do agree with you. I have lived WAY beneath my means for years waiting for this blow over. In retrospect, I should have pulled a Casey Serin. Bought a place, and taken as much money out of it as I could get away with.

Hell, I am tempted to get a house now (with as little down as I can get away with), and not make one damn payment. Rent free, nice place for 18+ months and all the happens is ruined credit. Oooooh, I am sooo scared. This country is a joke.

The Housing Bubble Ate My Balls said...


6 Investment Banks down to 2...

By tomorrow Hank will have blown the Nation's Wad to create this bailout. It will cost $2 Trillion, the U.S. Tax Payer will never see a dime of "Profit". The Wall Street Old Boys and Fat Cats will get Bailed and their pockets lined....

The bad housing news is just getting started, we have 2-3 years of Alt-A, Option Arm, and Prime Foreclosures coming up. It's the 3rd inning and hank is already blowing the wad..

What will he do then??

We've gone from 6 banks that were "too big to fail" pretty much rolled into 2 banks.

Does that make them "4 times too big to fail?"

harry truman said...

Times are tough my friends.Lets rally together and support keith for all is hard work.He worked his ass off to bring quality reporting to you at no cost.We are some of the brightest people in america.We saw this train wreck coming 4 years ago.I am not rich.I haven't worked in 3 months.I spend my time educating myself on the problems we have.Thanks to keith for keeping a quality product here and making it fun.

Anonymous said...

The HAC is back!!!

Anonymous said...

First, I figured Schumer to be a swallower.

Next, 'we' here in America only made it 'through-the-week' because we ran out of days.

Now, its' the weekend, where the DC crooks rape US in the smoky backroom and the idiot voters are transfixed by irrelevancies such as beach volleyball, cheese doodles and cars going around in circles.

America is Dead, the corpse is rotting and the vultures are picking the bones clean.

Fuck America. Nobody cares.

America is Dead said...

America or Americans will never be taken seriously about anything that matters ever again, by anyone, anywhere.

Just a filthy stinking corrupt nation of pimps and petty hustlers all screwing each other.

America is DEAD thanks to:


EL Presidente Jorge Bushco and his trusted underling Shotgun Dick Cheneyburton


Regina said...

excuse me but hasn't this been predicted for over a year, and just like someone who ignores body warnings about an inpedending problem (blood coming from places it shouldn't) didn't everybody just ignore the signs and wanted life to continue on as usual, still buying hr2's, going on the bay boating, still soccer moms, when the gas goes down 5 cent a gallon run out and start driving again, loading up on shopping left and right. No one believes this stuff and never will, this is the land of streets paved in gold, the land of good and plenty where foreigners come in at 4'11 and 100 pounds and grow to 6'2 250 pounds in a generation. This is the land where I should always have better than my neighbor and flaunt it, where I am entitled to a six figure salary because I earned it and then complain others didn't try as hard as they did (never mind that they had privledges others neither had or knew of) where people are rude to each other, pass judgement on each other and know nothing about the people they are passing judgement on, where people are seperatist and it is allowed because of political correctness, where other countries can come in and take over parts of cities and make them just like home because they miss home but don't want to go back there and then never intergrate into American society. What did people really expect where the people in charge are moved by greed and hatred of their fellow man and want to stick it to em, and if they can't afford those house payment kick their asses into the street, now they are unemployeed facing that same threat to. Selfish, self centered, unsympathetic, mean and brutal are the american people. Did it change when we opened the doors for all the people of the world to come in and be the way they are in their countries here. American rules do not apply, drive down the freeway and you'll see screw the driving laws I want what I want now even if I wreck into you and distroy my car. If they feel that way about their own lives I can't imagine how they feel about yours.
Did anyone expect when they were wracking up cash on the market what a cost it was going to take on the American people or were they happy and bragging about shorting stocks and making a bundle and can get to go on exotic vacations while people in Haiti and Africa (who have always had problems)and some middle eastern countries were begging food. What did you expect, did YOU think it was going to go on forever. Just like the housing crash and people thought that was going to go on forever. No nations succeeds if the lower class can not fight their way to middle class. As in your past post you or someone mentioned that the rich were finding ways to horde the money and keep the poor poor. Well what did you people (republicans) think the ride to the top was endless and you laugh about the printing presses going for 24 hours a day who caused all this greedy people who think they deserved six figure salaries because they are entitled. The warnings were ignored because people wanted to keep making money until the very last dime because they needed to be rich because that was the last frontier and now people are complaining about loosing a BUNDLE you can not loose what you gambled to make, every one wondered what was the last bubble would be and as I see it it was/is the stock market and it has blown up in spectacular fashion. Don't blame the politicians, don't blame the media, don't blame the mexicans, don't blame the housing market blame yourselves for unmitigated greed and your hopes that farm workers could afford those 500,000 houses picking strawberries, blame yourselves for wanting to live away from those people, everyone want to own their own business, everyone wants a diverse portfolio, everyone want to brag about how much they spent on their house, how much money flows through their fingers, how expensive toys are, ipods, iphones, new computers (yearly), designer clothes, square footage, lear jets, 100,000 kitchens, 25,000bathrooms, 50 inch plasma tvs, designer dogs, exotic vacations, million dollar weddings (divorice soon after), overpriced expensive two seater cars or high profile cars, the lists are endless what did you expect when that greed is only to buy to flaunt wealth. I don't hate the wealthy but I hate that my next door neighbor who is no better than me thinks that they are because they make 20,000 more and thinks they are a step up. What did you think was going to happen when the people working at McDonalds are paying for your lifestyle, that business model was going to work forever. It appears everyone is getting exactly what they deserve for their greed I guess including me.

Anonymous said...

It's hilarious listening to Schumer (D-WallStreet) pontificating on this fiasco. He's just a bought and paid for Wall Street slimeball. All the money he gets from Goldman Sachs and the other crooks and he still hasn't got a clue. That's how Wall Street likes its sock puppets: corrupt and stupid.

future expat said...

These ignorant/criminal representatives of the people are beyond worthless. I would suggest sending each and every one of them a link to Housing Panic archive from November 2005, except that they wouldn't look at or understand it if they did.
Kieth and the HPers have been discussing the occurences of this week for the last 3 years.
But the ignorant/criminals in government have been blindsided?
Hell, Wall Street saw this a year and a half ago when the first cracks appeared. Nobody cared, the market set new highs for 6 more months.
America is dead.
I pledge allegiance to the Bankers.
Of the amazingly ignorant bunch of zombies.
And to the banana republic for which we slave.
One corporate reich.
Full of evangelicals.
Hopelessly divided.
With riches for few, and McDonalds drive thru.

Anonymous said...

Andrew Hac is the new Will Rogers.

As much as I love Andrew he is missing 2 important items in his rant:

1. The lazy, fat, stupid Americano Turtle hates the Gays and their so called "gay marriage"

2. The same Trailer Park Trash Turtles LOVE them The Rapture and Sarah Palin! Just saying her name gives me the Holy Ghost and sends me into Talking in Tounges


Lost Cause said...

They only managed to postpone the day of reconing. That is another thing about markets -- they ALWAYS seek balance. The Ministry of Propaganda wants us to think that the market response was positive, but it was really shorts covering. If they keep it up, Wall Street will become as silent as a Southern California open house.

thomas jefferson said...

I've never seen such crap in my entire life. If you BELIEVE Schumer and Dodd didn't have any idea what was coming, I've got a bridge to sell you. Admitting foreknowledge would make them culpable. Look for more public pearl clutching from the democrats...
Naive dopes.

Reality said...

Keith, can't believe you fell for the fear-mongering. What a "total collapse" of the existing financial system would have meant:

1. Savers with less than $100k in each account ($250k for IRA accounts) have no need to run on the bank, as existing FDIC rules would have covered the sub-$100k accounts.

2. Savers with more than $100k in each account would have to either diversify into multiple insitutions so each is below $100k, or shop for better places to park their money: such as insitutions managed with less exposure to the toxic wasge, and/or insitutions that pay higher interest rate to compensate for the risk. Imagine that, paying savers higher interest rate! and managed their firms with discipline!

3. Banks that are insolvent due to the toxic loan exposure will be bankrupt. Homeowners who owe money to those banks will simply stop paying their mortgage, and still get to live in their houses, until the banks are auctioned off. Those who buy the banks for 10 cents on the dollar at auction will be able to offer home mortgage debtors 80% reduction on outstanding mortgage debt, and still be able to make a 100% profit. With the huge reduction in mortgage debt, the housing market will be liquid again, at much much lower price point, where it would make sense to buy again instead of renting, and make sense again to buy for renting out to others. Imagine that! Affordable housing at last! And people will actually have disposable income after mortgage payment reduction!

4. Businesses that need short term loan for operations will be hooked up with jumbo savers who need a place to park money by new banking institutions that have zero exposure to the toxic waste. In fact, the new banks can even go to the auction market above to buy failed banks and bad loans for cents on the dollar. . . a new age of prosperity then can begin. Imagine that!

5. The golden parachutes for former executives who ran their companies to the ground will be voided because all the formerly big banks will be bankrupt and have all the obligations to their ex-executives wiped off. Imagine that!

6. The suddenly poor former executives will sing in law suits filed to get their money. We will get to hear a lot of details on Washington corruption between the banking industry and the politicians!

That last point was the really really scary part for those at the meeting in Pelosi's office as Paulson laid out what-if's . . . it was Armegedon indeed, for the political establishment! Now you know the reason behind the bipartisan effort.

Anonymous said...

"People are beginning to doubt our system"
-George W. Bush

"...An expansion of jobless benefits was one possibility.

Asked about the chances of adding such items, Bush sidestepped the question, saying only that now was not the time for political posturing..."

JUST LIKE December 15, 2000, when Phil Gramm slid through the Commodity Futures Modernization Act...

...the legislation contained a provision—lobbied for by Enron, a generous contributor to Gramm—that exempted energy trading from regulatory oversight, allowing Enron to run rampant...

...the Enron loophole was small potatoes compared to the devastation that unregulated swaps would unleash...

...Wall Street's biggest players (which, thanks to Gramm's earlier banking deregulation efforts, now incorporated everything from your checking account to your pension fund) ran a secret casino..."

Anonymous said...

but if the credit markets froze up would not my dollar that was deposited in the bank and until recently was required to,and that let the banks print up 10,20, or 30 times more debt dollars indistinquishable from my dollar, to compete at the buying and bidding processesses of any good sold like housings, with my one dollar that might break even from its loss of purchace power causing the prices of those houses to fall and fall as no one would lend in order to lose 90 percent of their purchace power by giving loans to borrowers to bid prices higher again or more, so now taxpayers will? what of the loss of their dollars purchace power?

Anonymous said...

This is a scam, they were chirping on CNBC for days "Is your money safe"
They want this to happen so they can shove through bailouts, who knows where that money REALLY goes. Watch TV and see the propaganda at play.

They are saying "we had no other choice."


shill bastardz said...

“We have never heard language like this.”

Probably went something like this:

Paulson: "The boyz at Goldman sez we gotta do this."

Bernanke: (nods)

Schumer: (nods)

Dodd: (nods)

Dodd: "Tell 'em it's a slam dunk."

Paulson: (nods)

Bernanke: (nods)

Dodd: "Meeting adjourned."

Dodd: "Hey, what's for lunch?"

WTF1920 said...

You know, earlier this week I jokingly told my boss, "Pretty soon you're going to have to pay me in ammunition and bread." He gave a nervous laugh...I think he knows what coming around the corner. Not to many people are in denial anymore-we're past that. People finally realize how fucked we are.

Refuse to buy overpriced said...

I'm skeptical of the alleged "Great Depression 2" threat.

I think Paulson is just the world's greatest poker player, and he bluffed the United States out of $700 billion.

Anonymous said...

Govtmint tried to save the country during the great depression, it didnt work then, it wont work now.

Anonymous said...

People, we have not avoided a catrastrophy, the stock market will still crash next month. Haulting short naked selling isnt going to change the fact that the market will continue to drop, as it was in the beginning of the stock market crash in October 1929.

Back then the stocks wipsawed up and down a month or two before it crashed and kept dropping. Markets dont behave this way unless lots of people are exiting and buying at the same time.

Get your crash helmet ready.

Anonymous said...

Area 51 said:"But don't fret, you can still short some stuff, and rest assured, now there is no cover support for the next down day so prepare for a -800 DOW day soon."

Agree, October is just around the corner. Going to be worse than anyone imagines.

Anonymous said...

Lost Cause said:"The Ministry of Propaganda wants us to think that the market response was positive, but it was really shorts covering. If they keep it up, Wall Street will become as silent as a Southern California open house."

Agree. Have too look through all the smoke and mirrors to know that Fridays Fed action caused the shorts to cover their positon which gives the allusion the governments trick worked.

Dont be fooled.

Anonymous said...

Your darn right that Hank Paulson is a poker player .Further ,Paulson was involved with the Banking investment
Division of Goldman before he became the Treasury Sec. Do you realize that Paulson might of made money
on CDO's. I'm not saying I have any proof of this ,but how can a Co-Chairman of a Banking Investment Division of a Big Wall Street Investment Firm ,who made billions ,not of been into Mortgage Back securities in order to make that kind of money ?

I'm just saying that Hank Paulson is not exactly bias and he is the wrong man for being a public servant for the benefit of the people .

Anonymous said...

wtf1920, that nervous laugh from your boss is because you're a loon. Bread and ammo, nice. Prepare to be included in the next layoff.

Anonymous said...

No worries! Nothing this administration has done has worked. This won't either.