"On the Dishonest Sale of the Bailout Bill"

[r2d2]

http://www.nakedcapitalism.com/2008/09/on-dishonest-sale-of-bailout-bill.html

"One of the worst things about TARP is the way that Paulson has wrongfully and mendaciously conflated the last week’s money market panic with the need for TARP. They are two separate issues. As you probably know, the short term credit markets got close to seizing up last week. I understand why Paulson injected $105 billion to calm institutional money fund holders and then guaranteed money fund holdings (though the way he did the latter was hamfisted in my opinion).

However, if I understand the NYT article about Paulson’s briefings to Congress to sell TARP, and his other attempts to sell TARP on television, he seems to be saying that TARP will prevent a market Armegeddon. As far as I can see, we got close to Armageddon with the money market panic (which he touched off by letting LEH fail without making sure creditors got a reasonable shot at getting most of their money back). At any rate, money markets won’t seize up while money funds remained guaranteed by the Treasury, so we have time to work out a comprehensive solution and no need to jam through TARP or anything as reckless. We have time to get it right. He is using the money market problems to grab for power, and that seems to me to be both dishonest and under-reported."

 

[Ivanovich]

Ok, but a grab for power? He's out in 4 months, isn't he?

 

[Daal]

Quote from Ivanovich:

Ok, but a grab for power? He's out in 4 months, isn't he?

man, we are talking blogs here. if they dont dramatize nobody will read them. they are the tabloids of finance

 

[otcstockfund]

i saw something where the American Bankers association wasn't too pleased with the Fed's support of the money market funds. Their reasoning is, it pretty much is like an FDIC for mmf's. So why would an investor chose a CD over a mmf when mmf's implicitly now have the same default risk but no penalties for withdrawals.

 

[Hombre]

Quote from Ivanovich:

Ok, but a grab for power? He's out in 4 months, isn't he?

More like a power grub for his friends on Wall Street now and his rewards later when he will get a multimillion/year job from guess who .
All they want to do is to sell worst of their portfolios to the taxpayer for nice profit, give themself bonuses for doing great job and medal for saving economy.
Disgusting at best.

What needs to be done to extend line of credit for NEW LENDING ONLY .
Old bad loans portfolios and derivatives are messed up beyond repair, who made them must eat them. There is no other way .

 

[Daal]

Quote from otcstockfund:

i saw something where the American Bankers association wasn't too pleased with the Fed's support of the money market funds. Their reasoning is, it pretty much is like an FDIC for mmf's. So why would an investor chose a CD over a mmf when mmf's implicitly now have the same default risk but no penalties for withdrawals.

because its too late to change. you only qualified to the insurance if you had money as of last week

 

[r2d2]

Quote from Ivanovich:

Ok, but a grab for power? He's out in 4 months, isn't he?

One cannot speak for Jonathan, but imagine how the powers that be of the financial world would feel about this "gesture of goodwill."

 

[Ivanovich]

Quote from Hombre:

More like a power grub for his friends on Wall Street now and his rewards later when he will get a multimillion/year job from guess who .
All they want to do is to sell worst of their portfolios to the taxpayer for nice profit, give themself bonuses for doing great job and medal for saving economy.
Disgusting at best.

What needs to be done to extend line of credit for NEW LENDING ONLY .
Old bad loans portfolios and derivatives are messed up beyond repair, who made them must eat them. There is no other way .

Power grub [sic] for his friends on Wall Street? It's likely this will get passed with signifcant increases in oversight, perhaps even limitations on bonuses and payouts to CEOs. I don't think Wall Street will like any of that.

 

[Aaron Copland]

Quote from r2d2:

http://www.nakedcapitalism.com/2008/09/on-dishonest-sale-of-bailout-bill.html

"One of the worst things about TARP is the way that Paulson has wrongfully and mendaciously conflated the last week’s money market panic with the need for TARP. They are two separate issues. As you probably know, the short term credit markets got close to seizing up last week. I understand why Paulson injected $105 billion to calm institutional money fund holders and then guaranteed money fund holdings (though the way he did the latter was hamfisted in my opinion).

However, if I understand the NYT article about Paulson’s briefings to Congress to sell TARP, and his other attempts to sell TARP on television, he seems to be saying that TARP will prevent a market Armegeddon. As far as I can see, we got close to Armageddon with the money market panic (which he touched off by letting LEH fail without making sure creditors got a reasonable shot at getting most of their money back). At any rate, money markets won’t seize up while money funds remained guaranteed by the Treasury, so we have time to work out a comprehensive solution and no need to jam through TARP or anything as reckless. We have time to get it right. He is using the money market problems to grab for power, and that seems to me to be both dishonest and under-reported."

Know one trust's Paulson, and with good reason.

 

[sprstpd]

Quote from Daal:

because its too late to change. you only qualified to the insurance if you had money as of last week

Wink wink. Because if this crap were to ever happen again, we would NOT, I repeat NOT in a million years, make money market funds whole! We're warning you! Wink wink.