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mises
Joined: 05 Nov 2007
Location: retired
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 Posted: Fri Oct 03, 2008 10:06 am Post subject: We have been saved! |
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http://www.breitbart.com/article.php?id=D93J5NJO0&show_article=1
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WASHINGTON (AP) - With the economy on the brink and elections looming, Congress approved an unprecedented $700 billion government bailout of the battered financial industry on Friday and sent it to President Bush for his certain signature.
The final vote, 263-171 in the House, a comfortable margin that was 58 more votes than it garnered on Monday. The vote capped two weeks of tumult in Congress and on Wall Street, punctuated by daily warnings that the country confronted the gravest economic crisis since the Great Depression if lawmakers failed to act.
Bush was poised to make a statement on the historic vote.
"We all know that we are in the midst of a financial crisis," House Republican Leader John Boehner of Ohio, said shortly before casting his vote for government intervention in private capital markets that was unthinkable only a month ago.
"And we know that if we do nothing, this crisis is likely to worsen and to put us into an economic slump like most of us have never seen."
Speaker Nancy Pelosi, D-Calif., said the bill was needed to "Begin to shape the financial stability of our country and the economic security of our people."
Stocks were up on Wall Street, where there was a lot of anticipation of the vote but where investors also were buffeted by a bad report on the job market. The Labor Department said employers slashed 159,000 jobs in September, the largest cut in five years and further evidence of a sinking economy.
Even before the measure cleared Congress, the White House sought to dampen optimism of its immediate impact on the economy. "This legislation is to fix a problem in our financial markets," said spokesman Tony Fratto. "It's not sold as giving a boost to the economy, but rather preventing a crisis in our economy... If it works as we hope it will, credit will be able to begin flowing again."
The House vote marked a sharp change from Monday, when an earlier measure was sent down to defeat, largely at the hands of angry conservative Republicans.
Senate leaders quickly took custody of the measure, adding on $110 billion in tax and spending provisions designed to attract additional support, then grafting on legislation mandating broader mental health coverage in the insurance industry. The revised measure won Senate approval Wednesday night, 74-25, setting up a furious round of lobbying in the House as the administration, congressional leaders, the major party presidential candidates and outside groups joined forces behind the measure.
It worked�augmented by a sudden switch in public opinion that occurred after the stock market took its largest-ever one-day dive on Monday.
"No matter what we do or what we pass, there are still tough times out there. People are mad�I'm mad," said Republican Rep. J. Gresham Barrett of South Carolina, who opposed the measure the first time it came to a vote. Now, he said, "We have to act. We have to act now."
Rep. John Lewis, D-Ga., another convert, said, "I have decided that the cost of doing nothing is greater than the cost of doing something." |
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Kuros
Joined: 27 Apr 2004
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| Posted: Fri Oct 03, 2008 10:37 am Post subject: |
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| Too many elderly and soon-to-be elderly depend on their returns on the market for retirement. That's what this is about: their anxiety. |
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Ya-ta Boy
Joined: 16 Jan 2003
Location: Established in 1994
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| Posted: Fri Oct 03, 2008 1:30 pm Post subject: |
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Well, it passed. Good. It's only a week after Paulson said the economy could collapse, which brings his judgement into question. But anyway.
We now have one more thing to watch on Election night: How many, if any, candidates will be punished for voting for/against this bill. Only about 30 of the 435 House seats are competitive (which is a separate scandal all its own).
I was startled to hear Palin say gov't is not always the answer and it should get out of the way of markets (at least twice). McCain is calling for more regulation, from the clips I've seen. I'm curious to see if the Republicans drop the Reagan mantra or not. |
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mindmetoo
Joined: 02 Feb 2004
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| Posted: Fri Oct 03, 2008 2:28 pm Post subject: |
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There are "vulture fund" buyers who would have rescued some of this but as long as the investment firms and mortgage holders think they can get a better deal from public dollars there's no motivation for the private sector to work it out.
Vulture funds are not bad, either, despite the name. I think Buffet is largely a vulture fund guy. Korea Exchange Bank and Daewoo and lots of Korean assets were the target of "vulture" type buyouts but these funds saved them and grew them. |
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bacasper
Joined: 26 Mar 2007
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| Posted: Fri Oct 03, 2008 5:36 pm Post subject: |
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Has anyone actually read the bailout law? So it passed without providing for judicial oversight?
And is it true that it is for $700 billion at a time, meaning multiples of $700 billion?!?!?
Bailout - Devil is in the details
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10-3-08 | I find it interesting that among all the talk today about the bailouts that most people think we have no choice in the matter. That without the government stepping in all would be lost and America would go down the tubes. But how many of us have actually read the actual verbiage of the bailout act. I got the following email from the Ron Paul organization highlighting a few points that should be of interest to all Americans.
The bill states that: �The Treasury Secretary is authorized to purchase up to $700 billion in mortgage-related assets at any one time.� Most of us have been told that this is the total amount of the bailout, but as you can see it is the amount available �at any one time,� meaning they can do it again and again without any further legislation or consent of the governed.
The act also designates financial institutes as �financial agents of the Government.� In effect nationalizing the banking system whereas prior to this event banks were only a �chartered� government entity, meaning they could be regulated. Now if you are an agent of the government, how easy is it going to be for the government to look at all the books of the bank and have access to every bank account for every person in the banking system? With one foul swoop they have entered every banking account in the country to know exactly what you and I are doing with our money.
And to make sure no one can question anything they do in this regard the bill states: �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.� Now they have set themselves outside of the ability of anyone, inside or out of the government, to question what they have done. There actions cannot be questioned in court or by any �administrative agency.� How would you like to have that kind of power.
I find it quite interesting that the very problem that was caused by government involvement in the financial market is now looked upon as the answer to resolve that problem. By increasing government involvement and regulation, which caused the problem in the first place, and then place themselves in a position of immunity by not allowing their decisions to be reviewed, even by the courts.
The government created the mechanism whereby people who normally would not qualify for a mortgage were given a mortgage. They knew that these loans were risky and in many cases knew outright that they would end up in default but the banks were forced to comply. How were they forced? Banks are rated by the Fed. to determine how much money the bank may have to loan and thus determines how much money the bank can make. If you comply with their monetary schemes then you get access to more money. More money to loan by the bank means more profit potential, and what the heck the government is guaranteeing the loan.
All the while the housing boom is happening and house prices are going up and Freddie and Fanny are underwriting more and more bad loans. The housing prices keep going up due to the gluttony of buyers, unqualified buyers, and the ratio of good to bad loans hits the breaking point and it all comes crashing down.
The house prices fall, people now are upside-down on their mortgage and they won�t be able to sell because they owe more than it is really worth. You see the increase in property values was propped up by the government with all the bad paper that they forced on the market. Now they offer to �bail out� the market to allow the bubble to continue and the opportunity to create even more debt by the American people. The exact same reason that got us in trouble to begin with.
And we haven�t even tackled the question of which Article 1, section 8, enumerated power gives them the authority to do this in the first place. Hint, it doesn�t exist � this was totally unconstitutional.
Welcome to the new age of fascism! |
In addition to his argument regarding constitutionality, is any law constitutional which claims to be above judicial review? |
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Beeyee
Joined: 29 May 2007
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| Posted: Fri Oct 03, 2008 5:38 pm Post subject: |
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Please tell me this thread title is sarcastic.
The house just signed the death certificate for the dollar. |
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Ya-ta Boy
Joined: 16 Jan 2003
Location: Established in 1994
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| Posted: Fri Oct 03, 2008 5:44 pm Post subject: |
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| Most of us have been told that this is the total amount of the bailout |
This is not true. They've made it clear all along that this is just the first 'installment' and that there are more bank collapses to come. If someone does get that, they have not been reading/listening for the last two weeks.
(I stopped reading at that point. If there are other errors, let someone else find them.) |
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Axiom
Joined: 18 Jan 2008
Location: Brisbane, Australia
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| Posted: Fri Oct 03, 2008 7:54 pm Post subject: |
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| Beeyee wrote: |
Please tell me this thread title is sarcastic.
The house just signed the death certificate for the dollar. |
Is this such a bad thing. Seems like it will be necessary to allow American industry to compete with China and India. |
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Beeyee
Joined: 29 May 2007
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| Posted: Fri Oct 03, 2008 9:02 pm Post subject: |
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This whole sorry mess is classic 'Problem-Reaction-Solution'.
People actually believe that they are being saved by the very people who perpetuated this downfall. The ignorance of the average American is both worrying and astounding. |
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