Bush To Announce - What?, page 1
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Topic started on 14-10-2008 @ 06:40 AM by Relentless
Bush to announce new details of bank rescue plan

WASHINGTON - The Bush administration will spend $250 billion this year to purchase stock in banks and take a number of other bold steps in an effort to combat a global credit crisis that is threatening to push the country into a deep recession, industry and government officials say.

President Bush was scheduled to announce the new initiatives early Tuesday after executives of the country's biggest banks were summoned to a remarkable meeting at the Treasury Department on Monday. Treasury Secretary Henry Paulson basically told the bank CEOs that they had to accept the government stock purchases for the good of the U.S. economy.


I'm too disgusted for words.

There are so many issues in this article and we still have to wait to hear the whole story today. All I see are red flags.

The Bailout Bill is what? 2 weeks old and the rules have changed. (Well, actually it's clear now that there were no rules.) Did any of you see/think they could use it this way? Check out the part about the FDIC Insurance limit in certain circumstances.




reply posted on 14-10-2008 @ 06:54 AM by Karlhungis
reply to post by 44soulslayer



Can you explain how the tax payers will see money from transactions like these? I have heard that mentioned a time or two during this bailout fiasco, but I haven't heard exactly how the taxpayer will see any of it? I mean, realistically they could just throw whatever profits that they see into the bottomless pit we like to call the national debt, couldn't they?


reply posted on 14-10-2008 @ 06:59 AM by 44soulslayer
reply to post by Karlhungis



Essentially the plan is deviously simple. To halt falling market prices, the governments buy any and all stock that is being sold. This drives up demand artificially, and takes the stock price along with it. Normally this sort of cartel buying would be considered illegal, but since its the governments doing it...

The net result is that governments will have significant shareholder stakes at a preferential dividend rate in private institutions. This means that where Goldman Sachs may have been paying out cumulative dividends of 10 billion last year, the government will get a slice of that pie.

Also, government ownership means that they have a vested interest in the banks so they will not allow banks to fail. This is the implicit guarantee that allows investors to know that they can stick a few thousand into a stock, since the government has a few million in that same stock and will hence not allow it to collapse.

So in 5 years time, not only will the dividend paid at a preferential rate to the governments have almost paid off the debt, the stock will also have gained in value. This should be good news for the taxpayer.


reply posted on 14-10-2008 @ 07:10 AM by Karlhungis
reply to post by 44soulslayer



So essentially, the only benefit that the tax payer (not in the market) is going to see is that their banks won't fail? When the government claims that "the tax payer could actually make a profit off of these assets" that doesn't really mean anything?

And yes, it does seem funny that they are launching full scale investigations into market manipulation at the same time they are implementing a plan for massive market manipulation.

I think I liked it better when the government felt like they had to hide this type of thing from the public. It seems strange to have them flaunting it now.


reply posted on 14-10-2008 @ 07:51 AM by Karlhungis
reply to post by ghostlandseller



Futures are up +313 right now. Have we slipped into some parallel dimension? Not only does the market always tank after Bush speaks, I was sure that yesterdays rally would be immediately followed by another large drop.

I am still betting it ends up in the red by closing bell.
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