Posted under Economics & Ron Paul
H/T: LR.
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This continues to be a bailout for bankers… The greedy speculators ought to be allowed to fail while the more prudent financial institutions ought to replace them.
Bernanke in his report:
Recognizing the critical importance of the provision of credit to businesses and households from financial institutions, the Congress passed the Emergency Economic Stabilization Act last fall. Under the authority granted by this act, the Treasury purchased preferred shares in a broad range of depository institutions to shore up their capital bases. During this period, the Federal Deposit Insurance Corporation (FDIC) introduced its Temporary Liquidity Guarantee Program, which expanded its guarantees of bank liabilities to include selected senior unsecured obligations and all non-interest-bearing transactions deposits. The Treasury–in concert with the Federal Reserve and the FDIC–provided packages of loans and guarantees to ensure the continued stability of Citigroup and Bank of America, two of the world’s largest banks. Over this period, governments in many foreign countries also announced plans to stabilize their financial institutions, including through large-scale capital injections, expansions of deposit insurance, and guarantees of some forms of bank debt.
In light of ongoing concerns over the health of financial institutions, the Secretary of the Treasury recently announced a plan for further actions. This plan includes four principal elements: First, a new capital assistance program will be established to ensure that banks have adequate buffers of high-quality capital, based on the results of comprehensive stress tests to be conducted by the financial regulators, including the Federal Reserve. Second is a public-private investment fund in which private capital will be leveraged with public funds to purchase legacy assets from financial institutions. Third, the Federal Reserve, using capital provided by the Treasury, plans to expand the size and scope of the TALF to include securities backed by commercial real estate loans and potentially other types of asset-backed securities as well. Fourth, the plan includes a range of measures to help prevent unnecessary foreclosures. Together, over time these initiatives should further stabilize our financial institutions and markets, improving confidence and helping to restore the flow of credit needed to promote economic recovery.
Paul nailed it when he said in his remarks: “credit is not capital”. This is a case of bankers looting America while tossing a few bribes here and there.
And if the banks were left with unsellable houses, the housing market would drop and the poor would then be able to buy or rent a house more easily. The ultimate loser in such a scenario? The bankers.
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I sincerely believe … that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.
Thomas Jefferson
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How bad will the coming hyperinflation be?
roho on 26 Feb 2009 at 1:18 am #
Your right Weaver………………This is a show. These Banking Oligarths are no different that the oligarths that escaped Russia when it collapsed.(And Putin still has warrants for them.)….They are still hanging out, milking the cow dry, before she falls over dead.
Let the Banks fail, as well as the “Detroit Car Industry” and let’s get on with this depression! FDR stalled it as well, making it last longer, and requiring a World War to bring us out of it.
Life sucks, but we are the generation that has to go through it. Redistribution of wealth is the goal inorder to make sure that the poor, disinfranchised, minority, get’s a headstart(A Jessie Jackson concept)………..But, it will fail and States Rights will surface in the chaos of “Leviathan’s” failures!
Once it crashes…….I would not want to have a recognizable political face?
Weaver on 26 Feb 2009 at 3:26 am #
Roho, you’ve got the right attitude!
Peter Schiff on Obama’s Speech
roho on 26 Feb 2009 at 2:58 pm #
Peter Schiff is correct in his assesment. Certain Americans have simply lost their way regarding what they consider to be a “right”?
I saw these destructive policies in action in the ninties, when after a home closing, we would look them in the eye and say, “You realize that you really don’t deserve a home, and if you let this home foreclose you will never get another one?”(Fannie May, Freddy Mac, etc.)………….As we would watch them get in their car and drive away, we often commented that it would foreclose in less than 10 months with the usual excuses.
And I believe that NOTHING happens by accident or ignorance in the realm of “Empire”!………It is all planned in advance to crash the economy, allowing the instant organization of the North American Union and implementation of the Amero. One big game of “Monopoly” with a tiny percentage of the players knowing when the rules will change?