Question for resident economists on Bailout/Debt...

A quick set of questions on the bailouts last year and what they covered.
First of all, is it true the receivers of bailout money did not have to account for what the money was used for? The 'no questions asked' characteristic about them?
Because I'm wondering why taxpayer money used for the bailouts didn't relieve taxpayers from debt they may have with any of the institutions that received bailout money.

If the government would have basically paid off a lot of people's student loans or other forms of debt, the financial institutions would still get their bailout, and the American people would have more money to spend which could combat the recession?

Or did we in reality simply buy 800 billion dollars of debt?

when thinking about what happened with the bailout...... dont' try to think LOGICAL i.e what would have been best for the "country"....that is NOT how things work here anymore (why would i say this?)

The people who are employed and dedicated to lobbying (and lawyers) for big industry ....in this case FINANCE.......have the most leverage with Washington ........(who then decides policy)....understand alot of Big finance capitalists do a "term" in washington..sometimes as REGulators (while still having industry intrests at heart) and then go back to the private financial sector when they are done!.....So you have two forces in the Eyes...Ears...Face of congress......high powered lobbyists and lawyers for financial company's (who also have $ to "spend" on favors) pushing washington's policy buttons........and on the other side you have CITIZENS...i.e people writing letters... Which one do you think is more effectively pushing the buttons..?

ok now take that obvious answer and apply it to nearly every industry in the economy and you will probably get a answer to alot of the injustice....you can then guess who's side the Main stream media (and the precious advertising dollars big industry corporations give to them) is on.....then you can take that answer and figure out why all the B.S perspectives are touted to obfuscate the real ripoff's going on ...i.e industry leaders simultaniously gettng favors from washington that over time accumulate into injustice..... Private central bank....rising unemployment...more debt......uninformed populace...........Economic Crisis ....then finally if were really stay docile for the next few years.....A totalitarian Gov't..........perhaps we should all recite this before bed....





[edit on 29-5-2009 by cpdaman]

reply to post by Psynarchist


$800 billion?

try $68 Trillion

www.abovetopsecret.com...

that's $546,668 per household

no one else want's to take a crack at this? was i a off on my answer?

and warren that 68 trillion was built up over many generations, no

The bailouts have been given in exchange either for assets in companies or for equity stakes in companies (such as Citibank and AIG). This exchange was the way in which the bailouts were packaged as 'good investments' using taxpayer money rather than just donations.

End result? The AIG money was funnelled throughto other companies like Goldman and Deutsche Bank and more was needed. So the AIG bailout was just a favour by investment banks for investment bankers. Taxpayers wont see a return on investment, it has gone to the investment banks. AIG is forced to try and sell of as many assets as possible to try and pay the money back but doesnt have enough assets to sell.

Citigroup is still likely to fall over as well.

So basically its a rort.

First of all, is it true the receivers of bailout money did not have to account for what the money was used for? The 'no questions asked' characteristic about them?
Because I'm wondering why taxpayer money used for the bailouts didn't relieve taxpayers from debt they may have with any of the institutions that received bailout money.

Yes, it's true there where no conditions on how the money was used, in fact the banks were encouraged NOT to use it to boost liquidity (the reason they claimed they had to give money to the banks) but to use it to take over other failing banks. That's why Paulson and Bush insisted on having a no accountability clause and immunity from prosecution.

Pay off taxpayer's debt..? You're kidding, right? The banks have all doubled their credit card rates and canceled credit lines. It's like a contest between the banks and the government to see who can shake the most money out of the citizens.

We're 18 months and as much as $12 Trillion into this thing and as far as I'm aware, NOTHING has been done to help the taxpayer. The stimulus package is a joke, a hundred thousand temporary jobs created when we're losing 650,000 real jobs every month. The "Help for Homeowners" is an even bigger joke with something like 52 mortgages being rewritten out of the MILLIONS facing foreclosure, and it now turns out that 50 of those loans are fraudulent.

Read some history. Every Empire ends with the looting of the treasury.

I think what it boils down to is they took our tax money gave it away ,and now not only will we have to pay it back,but at usery rates,usery was against the law last I remember,I guess unless your the Federal government,looks to me my childrens future was given away by people with an agenda

reply to post by Oldtimer2


No we don't have any protection from Usury anymore. Our elected representatives took care of that little inconvenience long ago.

The Depository Institutions Deregulation and Monetary Control Act, a United States federal financial statute law passed in 1980, gave the Federal Reserve greater control over non-member banks.

* It forced all banks to abide by the Fed's rules.
* It allowed banks to merge.
* It removed the power of the Federal Reserve Board of Governors under the Glass-Steagall Act and Regulation Q to set the interest rates of savings accounts.
* It raised the deposit insurance of US banks and credit unions from $40,000 to $100,000.
* It allowed credit unions and savings and loans to offer checkable deposits.
* Allowed institutions to charge any interest rates they chose.

Yeah, it does seem to be a huge swindle and money grabbing fest out there.
All the replies so far share the same sentiment that we've been and are being robbed,
I wonder if there are people out here who think the right decisions were chosen at the right time by people with integrity and who only acted with the citizens best interests in mind...

Probably more like the best interest rate for the people's debt.

reply to post by Psynarchist


Well I am one of those people.

I mean, im sure not everything was kosher but we did what needed to be done.

We need to keep the printing presses running right now, we are in a deflationary environment, no matter what anyone says right now.

We had half of our wealth destroyed over the past year, we need to "magically" reflate what we lost

Yes, maybe the money went into the pockets of big money and banks, but you are starting to see that money flow into the market (look at the close on friday) now there are a few opinions on why that happened, but call it whatever you want to.. the market is telling you what is going to happen down the line 6-18 months from now..

I think we saw the best buying opportunities of our lifetime 2 months ago, it was hard to act on, but buying at the bottom always is

Originally posted by GreenBicMan
reply to post by Psynarchist

 

Well I am one of those people.

I mean, im sure not everything was kosher but we did what needed to be done.

We need to keep the printing presses running right now, we are in a deflationary environment, no matter what anyone says right now.

We had half of our wealth destroyed over the past year, we need to "magically" reflate what we lost

Yes, maybe the money went into the pockets of big money and banks, but you are starting to see that money flow into the market (look at the close on friday) now there are a few opinions on why that happened, but call it whatever you want to.. the market is telling you what is going to happen down the line 6-18 months from now..

I think we saw the best buying opportunities of our lifetime 2 months ago, it was hard to act on, but buying at the bottom always is

Seriously? Check this out, you cannot look at a large increase in the stock market buys at the end bell on a friday. The major companies that had "put calls" and "shorts" had to cover them before the weekend. With the news so uncertain at this moment, the last thing any investor wants is to get stuck covering their shorts at a large loss. One day does not show a good trend.

Believe me when I say that we have not seen the end of the stock market crash and rally cycle that we have been seeing the last 7 months. We have yet to see all of the "trickle down" economics of what has been happening the last several months. We are just now seeing Ford parts suppliers go bankrupt and have yet to hear much news about GM and Chrysler parts suppliers going bankrupt.

The true ramifications of this economic downfall have yet to be felt.

reply to post by LeaderOfProgress


They are all priced into the market already..

If you think otherwise, you are one step behind.

EDIT:

By the way, covering had nothing to do with what happened at the close friday lol

500 million dollars was put through the markets in the last 2 minutes.. you should read up on it at "MARKET THREAD"

[edit on 30-5-2009 by GreenBicMan]

Originally posted by GreenBicMan
I think we saw the best buying opportunities of our lifetime 2 months ago, it was hard to act on, but buying at the bottom always is

I agree and disagree, at the same time.

On one hand, I think that the market won't sink as low as it did (and frankly, if it sinks much lower than it did, then I think that pension obligations and insurance-sector annuities would bankrupt so much of our economy that it wouldn't matter).

On the other hand, I don't see any indication that our government is going to make a genuine effort at reinstating the regulations that have prevented this type of problem since the Great Depression. Without these regulations, "depressions" will become a fairly common thing again, just like they were before Glass-Steagall.

And this is moderately OT; but when you look at recent trends in bio-gerontology, I think that it's safe to say that we're going to live a LONG time (unless SkyNet becomes a reality).

reply to post by theWCH


hey wch - where you been?

And I am into what you are talking about as well with living longer..

I have heard some pretty cool stuff regarding this, not to get off topic of course

_________

And I agree.. the market was almost to the point of showing total mass destruction for our economy, and it wouldnt matter anyways,

Thats a very good point, and not too many people have brought this up

reply to post by GreenBicMan


I was distracted by a couple of side projects -- I'm more than a bit ADHD -- and I wound up neglecting ATS.

Specifically, I've been analyzing the data from this past NBA season -- but that's not very interesting for ATS purposes. I've also been taking a second glance at AI research (inspired by the recent Terminator movie, of course) and it cracks me up that people on the Survival Techniques board are worried about a zombie outbreak, but they're ignoring the fact that AI should be able to pass the Turing Test by 2029; and a Terminator-type scenario could actually become a valid concern, if we aren't careful. I suppose that's too far in the future.

Back on topic: mythatsabigprobe basically summed up what happened. But if it makes you feel any better, the failure to bail out the financial sector would have probably plunged us into total collapse. When people complain about the bailouts, they forget that -- at the bare minimum -- the bailouts allow us to keep the lights on a few months longer.

[edit on 31-5-2009 by theWCH]

reply to post by theWCH


Yeah, I totally think this whole market has affected people in all different ways and circumstances, some more than others of course...

And I asked you on the market thread, but u must have missed it, i was wondering how your nba stuff was going

There can be no rally that is sustainable above 10,000 for the next YEAR or perhaps 3 or 4.....

Green Bic Man is right that alot of 1'st and even 2'nd Q Poor earnings are priced in!.......but Guess what else is getting priced in .........A BIG TURN AROUND in EARNINGS by Q4.........

Remember the OLE IMF telling us that "downturn" caused by financial crisis LAST LONGER and especially when they are "worldwide financial crisis"

Well unemployment is not currently expected to Top out until 2'nd Q 2010

Commerical real estate is collapsing in value as we speak and in 2010 alot of company's will need to roll over their debt (from the financing they received in 2005)....this will be the catalyst for small and mid size banks to fail

After that in may of the 2'nd Q 2010.... Alt-A resets increase rapidly for a period until late 2011......

House prices continue to fall........stocks can only trade at HIGH values again when EARNINGS is there (not just earnings "not as bad as forecast").......the hope and pray MSM stategy combined with PPT may get market to near 10,000 but when 4'th Q earnings are not there .....BOOM back down we go.....We need a driver for earnings i.e income and consumption attitude............the consumer is deleveraging due to lower asset values and lack of availability of credit and lack of additional room and /or desire to go deeper in debt...........think this thru fella's

[edit on 31-5-2009 by cpdaman]