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Fox Biz is reporting that the House Financial Services Committee is set to take up legislation this week that would establish a federal backstop for all Municipal bonds and muni insurance. This would, of course, represent another massive expansion of the government's guarantees and turn all states into Fannie and Freddy.
* Create a liquidity facility through the Federal Reserve to purchase municipal bonds, much like what the Federal Reserve does with mortgage-backed and federal government bonds.
* Form a temporary federal government program to reinsure municipal bond insurers. Almost all municipalities buy bond insurance because it boosts their credit ratings. The cost of the insurance is usually lower than the higher interest payments that come with a lower credit rating. If the insurer runs into financial trouble, then the credit ratings on the municipal bonds drop because there is doubt about the insurance. Government backing would eliminate that concern.
* Provide additional regulation for financial advisors to municipalities. Many, including former Securities and Exchange Commission Chairman Arthur Levitt, have been calling for stronger oversight of the municipal bond market in the wake of pay-to-play bond scandals, in which banks and advisers have made gifts or political contributions, and received financing jobs along with the fees for those jobs.
reply to Iamonlyhuman
How many times recently has the federal government threatened to turn off $$ if states didn't comply with their wishes?
This is bad. The federal government should not have their fingers in this pie!
reply to marg6043
I can not wait to see the states that will deny this new bill to hit their door steps.
Those states are the ones that will make it to my favorite list.
Because remember this will work as long as states are compliant.
Originally posted by Maxmars
Barney Frank and his crew are employees of the Fed. This is the same process by which they destroy sovereignty world-wide.
Of course, in America, the states presented an obstacle. So now our so-called ''elected representatives' will vote on this.... whom do you think they will 'represent'? You? Me? or the Fed?
I hope we still have real live governors in this country who care about their states. I'm sure there are a few, but I doubt the Senators and Congresspersons can be counted on anything other than instant and immediate compliance with the "party" line - i.e. they vote as their party leaders tell them to vote. What the people WANT is an irrelevancy.
They already know what they are going to do. The rest is just showbiz.
Originally posted by Iamonlyhuman
I hope my state, SC, will oppose this. I know the governor will, he's the one who is still taking political flack over not taking all of the stimulus money because it would not be good for the state. We've also passed a states' rights resolution. Hopefully, this streak of statehood will hold... for us at least.
[edit on 13/5/2009 by Iamonlyhuman]
Originally posted by xstealth
Originally posted by Iamonlyhuman
I hope my state, SC, will oppose this. I know the governor will, he's the one who is still taking political flack over not taking all of the stimulus money because it would not be good for the state. We've also passed a states' rights resolution. Hopefully, this streak of statehood will hold... for us at least.
[edit on 13/5/2009 by Iamonlyhuman]
Your governor is the same one who attended Builderberg last year. Everything he has done recently has been a publicity stunt. I think you'll be seeing him run for president the next Election.
Hes not on your side.