http://www.ritholtz.com/blog/2008/11/aig-the-looting-continues-banana-republic-watch/

Quote :

"But the worst is that not only was the initial AIG de facto bankruptcy a case of looting, the government has now decided to aid and abet AIG management in further looting. What pro-taxpayer purpose is there in the improvement of terms above? None. As we pointed out, there were only a couple of reasons for easing up on AIG, and they could have been provided for with minor changes that would not leave the taxpayer materially worse off. Instead, major concessions have been made to AIG, all to the detriment of the taxpayer. AIG management now has job security for five years (and AIG top brass is very well paid) and better odds of salvaging something for themselves when the five years are up thanks to the government giving them an unwarranted subsidy. When the TARP was announced, we called it “Mussolini-Style Corporatism in Action.” Sadly, it looks as if events are panning out as foretold."

Are Paulson and company willfully helping their friends, or are the folks running the show in Washington just stupid and are allowing themselves to get pulled into whatever direction these whiny bitches on Wall Street decide to pull them? Our money is being looted from us.

I'm gonna be firing off emails all morning with links to this blog post.

11/10/2008 7:25:45 AM

Just got done reading most of the article

Id have to say that the only explanation is Paulson and company are helping their friends. One thing is for sure . . . the everyday taxpayer is getting the shaft

11/10/2008 11:30:34 AM

Quote :

"Remember, AIG does NOT has any God-given right to existence. "

11/10/2008 12:22:55 PM

Not suprising. The bailout bill was essentially a blank check, signed with little thought, debate, or care by Congress and the President.

Well, that's not entirely true. They cared enough to add $150 billion in pork.

11/10/2008 5:00:39 PM

http://www.bloomberg.com/apps/news?pid=20601087&sid=aatlky_cH.tY&refer=worldwide

Supposedly 2 TRILLION dollars in emergency loans have been given out, and a significant portion of it is unaccounted for.

11/10/2008 6:44:35 PM

The 2 trillion is all accounted for, they just aren't releasing what sort of collateral has been posted against the loans.

11/10/2008 6:49:39 PM

Quote :

"Remember, AIG does NOT has any God-given right to existence."

When someone can outline the scenario underwhich AIG goes bankrupt and the rest of the world does not, then I think AIG will stop getting help.

11/10/2008 9:08:44 PM

^^ the point is that 2 trillion is an INSANE amount of money for the gov. to just blithely loan out.

That's almost 7000 for every man, woman, child, and illegal immigrant in the US, or about 13,000 for every tax payer in the US.

11/11/2008 12:20:09 AM

Complaining to our representatives 99 to 1 against the 700 billion bailout worked so well the first time.

11/11/2008 12:41:32 AM

i complained to my congressman, about his support of the first bailout. i forget exactly what i wrote, but it was along the lines of the folly of using taxpayer money to bail out irresponsible corporations who were blinded by short term profits

here is the response i got:

Quote :

" From: Congressman Jim McDermott <ima_wa07iq@mail.house.gov> Date: Thu, Nov 6, 2008 at 1:05 PM Subject: Responding to your message To: joe_schmoe Joe Schmoe xxx xxx xxx Seattle, Washington Dear Joe: Thank you for contacting me to express your views regarding HR 1424, the Emergency Economic Stabilization Act of 2008. I understand your concerns, share many of your frustrations, and appreciate this opportunity to review the measure with you and to explain my votes on it. As you know, adverse and very serious events in the economy's financial sector produced a perilous situation for Washingtonians and all Americans. I was convinced that something significant needed to be done to restore liquidity to the credit markets upon which American businesses and consumers rely. After weighing many considerations, however, I voted against the final version of HR 1424 because: -- The legislation failed to address the fundamental factors that led to the financial crisis; -- It provided no help to struggling American households that are impacted by the crisis, and -- I had little faith in the Administration's plan and its ability to implement the legislation wisely. Proposal Ignores Causes of the Crisis Certainly, the events that led to this crisis will be studied for some time to come, but it is immediately and abundantly clear that lack of transparency, inadequate (and, in some cases, non-existent) regulation, and negligently lax oversight of banking and lending practices have been major causal factors. Our regulatory regime must be redrawn and revitalized to accommodate the new, global economy; today's market increasingly involves complex financial instruments that are not regulated, standardized, or well-understood even by those who trade in them. Systemic deficiencies in the housing industry triggered the current financial crisis, starkly illustrating the inadequacies of our regulations and the reckless practices of many Wall Street traders. The housing market collapse mirrors falling family income, which has declined steadily over the course of the Bush Administration. Many families sought to meet their housing needs with subprime mortgages they could not sustain as their wages fell or stagnated. As mortgage securitization became more and more widespread, the weaknesses inherent in the practice became increasingly problematic. Under a securitization scheme, instead of a bank originating a home mortgage and retaining the debt (and collecting a stream of payments over the life of the mortgage), the bank prepares the mortgage and then sells it to an institution that, in turn, sell bonds to investors that reflect the value of the mortgage. Once a mortgage is securitized, it can be bought and sold without federal regulation. When it became clear that far too many households had accepted mortgages they could not afford, holders of the mortgage-backed securities (MBS) had no mechanism for revaluing the bonds to accurately reflect the value of their underlying assets, which were rapidly diminishing as over-extended homeowners defaulted on their mortgages and foreclosures spiked. The nation's largest financial institutions, which recorded hundreds of billions of dollars worth of MBS as assets on their balance sheets, were forced to acknowledge the sharply declining value of these securities and, consequently, their own fiscal instability. Quickly, this problem cascaded down to much of the rest of the financial services sector as banks and other institutions became unwilling to lend money to each other at reasonable rates of interest. The credit markets froze, which would soon spell disaster throughout the economy because it relies on the ability of businesses large and small to borrow money easily to meet payrolls, maintain inventories, explore new markets, and expand capacity. This crisis stemmed from falling wages, declining home values, and subprime lending in the housing market, but it exposed extremely risky trading practices throughout the financial sector that endangered the entire economy. The legislation considered and passed by the House did not address any of the fundamental causes of the credit crisis. Instead, it simply offered a short-term fix, or "bailout", to the very individuals and institutions whose practices provoked much of the crisis. Main Street Left Behind While this bailout legislation was under consideration, the White House and Congressional Republicans refused to support an economic stimulus package that had already passed the House of Representatives. This proposal was intended to provide immediate relief to those facing severe hardship as a result of the floundering economy. It included a measure I sponsored to extend Unemployment Insurance benefits to those exhausting their compensation; it provided assistance to budget-strapped states to meet the critical needs of the vulnerable; and it provided new funding to repair and upgrade our nation's infrastructure, creating well-paying jobs and improving modes of commerce. The Bush Administration threatened to veto this stimulus proposal and Senate Republicans blocked it. Their hands were out for Wall Street, but they were turning a cold shoulder to average households struggling to survive economic calamity. Before the Senate considered the bailout legislation, the House considered an earlier version. I voted in favor of it so that the Senate would receive a bill from the House that I hoped could ultimately be improved by the Senate, and eventually by a House-Senate conference, to include elements of the stimulus package. When the Senate considered HR 1424 and failed to include any of the stimulus provisions in the measure, I led an effort to attach the stimulus package to HR 1424 after the Senate sent its version to the House. This effort failed, which made it impossible for me to support the stand-alone bailout measure. The Bush-Paulson Plan The primary thrust of HR 1424 reflects the Bush Administration's proposal to authorize the federal government's purchase - from major banks and financial institutions - of financial instruments that reflect the value of outstanding mortgages (mortgage-backed securities). The growing uncertainty about the value of these assets described above created a situation in which financial institutions were becoming increasingly reluctant to lend to each other as they typically do in the course of normal market activity. The Bush Administration planned to address the crisis by exchanging cash or Treasury Bonds for these deteriorating assets, thereby replenishing the balance sheets of the financial firms holding them. Many leading economists expressed skepticism that this approach was wise or effective, and this apprehension ultimately formed part of the basis of my objection to the legislation. I am especially disappointed that the legislation does not provide more assistance to individuals unable to meet the obligations of their mortgages and to those losing rental housing because their landlords cannot satisfy outstanding mortgages. I believe that a more deliberative process, devoid of "the sky is falling" rhetoric from the White House and some in the Congress, would have enabled the Congress to craft a more thoughtful and constructive legislative response to an unprecedented economic emergency. HR 1424 provided a gigantic blank check to an Administration that lost the trust of the American people long ago. When President Bush asked for and signed HR 1424 into law, he said, and Congress believed, that he planned to use the authority the legislation provided to spend up to $750 billion primarily to purchase mortgage-backed securities. But just 11 days after the bill became law, he announced that his Administration would reverse its course and instead use the authority the legislation provides to finance a partial nationalization of America's largest banks and perhaps smaller banks, too. Going Forward Fortunately, after Congress adopted and sent HR 1424 to the President, House Speaker Nancy Pelosi announced that she would call the Congress back into a special, post-election session, so that we will be able to consider a robust stimulus package that responds to continually worsening economic conditions. On October 20, Federal Reserve Chairman Ben Bernanke announced his support for the stimulus measure before the House Committee on the Budget. Despite its failings, HR 1424 contains numerous mechanisms - hard fought for by Democrats - whereby Congress and the American people can view and conduct oversight of the Administration's actions and expenditures. These are important monitoring tools, and I will closely review them as the program authorized by this legislation is implemented. Further, additional efforts are underway to pursue meaningful regulatory reform of the banking and financial sector, and I anticipate significant legislation early in the next session of Congress. I look forward to helping to shape this initiative, and hope you will provide me your thoughts and concerns as this process unfolds. Again, thank you for contacting me about this critical issue. I look forward to hearing from you in the future. Sincerely, Jim McDermott Member of Congress "

no point in bothering to complain about bailouts with this guy. FTR, i didnt vote for him. I wrote in Mickey Mouse. net effect would be the same.




[Edited on November 11, 2008 at 1:49 PM. Reason : ]

11/11/2008 1:41:36 PM

Another good reason to write your rep

Henry Paulson making it up as he goes along

http://www.cnn.com/2008/POLITICS/11/12/campbell.brown.bailout/index.html



Im suprised this thread didn't take off but I guess:

Quote :

"Complaining to our representatives 99 to 1 against the 700 billion bailout worked so well the first time. "

11/13/2008 7:42:11 AM

It's incredible that something like this wasn't set up earlier, but better late than never, i suppose.

The Congressional Oversight Panel is starting to issue reports about TARP/bailouts
http://cop.senate.gov/
http://change.gov/newsroom/entry/700_billion_of_your_money/

and it sounds like they got a good person overseeing it. She's on the video above, and also was on Fresh Air last week
http://www.npr.org/templates/story/story.php?storyId=98123372

12/15/2008 10:04:20 PM

The oversight board was established with the TARP, and this is simply the first time they've had to report to Congress. They made it pretty damn clear that the oversight board was part of the package.

12/15/2008 10:18:59 PM

well, whoever was in charge of actually convening that committee was slack, b/c according to Warren, they just got offices a couple weeks ago. Their first meeting was just 2 weeks before the Fresh Air interview on Dec. 11

[Edited on December 15, 2008 at 10:43 PM. Reason : .]

12/15/2008 10:41:49 PM