In an interview, Stiglitz said about the Obama-Geithner plan to aid Big Banks that it offered "perverse incentives." Hhmmm, "perverse." Ya think?
The U.S. government is basically using the taxpayer to guarantee against downside risk on the value of these assets, while giving the upside, or potential profits, to private investors, he said.
"Quite frankly, this amounts to robbery of the American people. I don't think it's going to work because I think there'll be a lot of anger about putting the losses so much on the shoulder of the American taxpayer." (My emphasis)
Not mincing words. Not often asked to appear on MCM interviews*. Go figure. Read below the fold...
I just posted best wishes to everyone who is going to Montgomery this morning for the Alabama Prepaid Affordable College Tuition board meeting. I am grateful for the assistance and support we have received from the community here as we've struggled to deal with the many issues surrounding this fiasco.
Many opinions have been offered on it. I agree with those who have argued:
PACT participants are contract holders, and the only acceptable outcome is for those contracts to be honored.
I hope someone will be able to get a first-hand account, photos, or videos from the meeting. I will post an update here as soon as I have one. Read below the fold...
I've only watched the first 15 or 20 minutes, so I don't have much to say beyond finally, somebody has admitted out loud that the Health Reform phrasing, instead of health care reform, is deliberate. I swear, if I hear We don't have health care in this country, we have sick care one more time, I'm going to barf. Read below the fold...
No greater sin, if all you care about is who wears what jersey. Nancy Kruh of the Dallas Morning News on "Why I'm not taking a bath in the market":
The only economic expert I follow religiously is New York Times columnist Paul Krugman, and he is the sole reason I did something back in March 2008 that millions of people now wish they had done. I yanked every last penny I had invested out of the stock market.Read below the fold...
That didnt' take long (by Eric Boehlert at County Fair, Media Matters for America)
The unhinged Right, egged on by hate bloggers and AM talkers, let their true feelings out at an anti-Obama rally in Orlando.
Remember when we couldn’t nominate Hillary because she’d be attacked by the right, but Obama wouldn't be? I remain, as always, the bad guy for reminding the bots how wrong they were—about almost everything.—Caro
Isn't one of the main problems right now the fact that banks aren't lending? Isn't lending to businesses the grease that will make the financial wheels turn again? I thought so. Well, these folks aren't ready to help out. Hmm.
At a time when small business owners desperately need loans and credit lines to help them weather the recession, some of the industry's most active lenders have bolted shut the doors to their vaults.Read below the fold...
Booman, bien sur. Hamsher can take care of her arguments and herself, so I'll focus on this delicious morsel:
There is a limited universe of people with both the experience and the capital to buy up and manage the toxic assets. The more money people made off creating this misery, the more likely they are to be flush enough with cash to take risks on fixing it.Read below the fold...
Tell me again how a government that gives ANYBODY trillions of dollars with no transparency and no accountability is legitimate?
Again last week more than 600,000 Americans lost their jobs. One professor on leave from UC Berkeley was not among them, and at the very least that's a dirty shame, despite this fawning tribute from Esquire.
Is this a war? How can the president respond? Can he use the Army? Will he need congressional approval? Is this a war?Read below the fold...
“It’s like pornography,” one student says. “You know it when you see it.”
Lambert, If you read the fine print written everywhere across the media and the intertoobz:
Sun, 03/22/2009 - 5:00pm — lambert>
So tell me again how much we're bailing them out for? What they left on the table, too? Confusing!
in 2 short paragraphs. A relatively long post for Atrios. And I'll explain why this is true below. Wheeeeeeeeeeeeee!
What's The Goal?
Others have made this point in various ways, but if the goal is to bail out the banksters and keep the existing too big to fail financial order in place with the same cast of characters in charge, then all of this sounds like a cunning plan.
If the goal was really to get banks lending again they'd be funneling large sums of money to healthy (mostly smaller) financial institutions who actually made sensible choices over the last few years.
Meanwhile a fire sale is going on:
Lenders have become so overwhelmed by the foreclosure crisis that they are starting to unload properties in bulk to investor groups at steep discounts.
Investors then flip the properties for a profit without necessarily improving the home.
For example, a unit of Citigroup, the troubled financial giant, sold a foreclosure in Temecula to an Arizona investment firm for $139,000 when comparable homes in the area were selling for $240,000 to $260,000.
The firm listed the home for $249,000, received multiple offers and the property has entered escrow, said Amber Schlieder, the real estate agent who handled the listing.
Citigroup left a 100 grand on the table. This looks like a great way to abuse the taxpayer even more.
I want to know who they are all selling in bulk to.
So it may come as a surprise that a dozen former top Countrywide executives now stand to make millions from the home mortgage mess.
Stanford L. Kurland, Countrywide's former president, and his team have been buying up delinquent home mortgages that the government took over from other failed banks, sometimes for pennies on the dollar. They get a piece of what they can collect.
"It has been very successful - very strong," John Lawrence, the company's head of loan servicing, told Mr. Kurland one recent morning in a glass-walled boardroom here at PennyMac's spacious headquarters, opened last year in the same Los Angeles suburb where Countrywide once flourished.
The Treasury has shown a willingness to recklessly toss all of our futures away to keep these "Too Big Failures" operating in their self-entitled comfort zone.
What incentive do the banks have to sell these properties for as much as they can when they can sell them in bulk at a loss to their buddies' companies (or even their own companies) so they can turn a profit on them and doing this knowing the failure bankers can ship off all of the bills for the losses to us? Think about it.
If Geithner were handing these trillions to the smaller more responsible bankers some of us little people would be able to buy these cheap houses... But this way the elite get to keep all of the assets in their greedy hands and have us pay for their gambling addiction failures too. And then they will turn a profit on selling us these properties AGAIN. Read below the fold...