Bail-out Bill Passes - Page 2 - Mercedes-Benz Forum

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post #11 of 18 (permalink) Old 10-03-2008, 02:09 PM Thread Starter
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Originally Posted by GermanStar View Post
Because we all knew the spineless little shits would sell out their country. It was all a matter of adding the proper earmarks (aka bribes).
McCain and Palin both supported this bill. The next time they say "Government isn't the solution, it's the problem", or quote Ronald Reagan, they should both be struck dead with a lightning bolt. So much for principles.

Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions. They understood that our power alone cannot protect us, nor does it entitle us to do as we please. Instead, they knew that our power grows through its prudent use; our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint.

-President Barack Obama, 1st Inaugural address
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post #12 of 18 (permalink) Old 10-03-2008, 02:14 PM
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What is also interesting is that all Obama and McCain have been saying, for the past several months, is how they are going to try to stop garbage like this. They both sure put up a good fight. Thank god that the few House members I respect voted against. There are still a couple people I can believe in. Unfortunately, that number seems to shrink every day.

I will do my part and get a second job to help out the fat cats.
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post #13 of 18 (permalink) Old 10-03-2008, 05:01 PM
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I wonder wich ......gate will be the headlines!

Let's see....Demogate?, Republicgate? Why would the govt. get into the business of owning a business unless someone or the fat cat's are getting fat. It's ridiculous to think that now Fannie Mae and Sallie Mae were bailed out but will the truth really be known now that the govt. really owns the books and the truth be told that numerous Obama, Fatcats ect were making money on others peoples money. Yet know one went to jail.

Here's a good one! Wachovia Bank!!!!! Citigroup wants to buy it. FDIC says yes. and gives them 2.1 billion dollars for it plus shares with govt. assistance. So now Well's Fargo says hey. We can do better, make money and have no govt. involvement. Citigroup is pissed. Asking for WellsFargo to remove it's interest. But tell me why should it? IF the government steps in and tells Wells Fargo to get lost then it shows you that somebody in the govt. is out to make money on the backs of the taxpayers! If you can't buy it legally then buy it illegally!

This is Scandalgate! Fat Cat Gate! The books in Fannie Mae, Sallie Mae should be opened up and just as those responsible for Enron went to jail. Those involved in these type of heinous acts of treason upon the back of American taxpayers under the guise of Govt. Bailout should go to jail. We need honesty. We need integrity. Start fresh. Fire the Fatcats with your vote! Seize their assests. Free America!!!!
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post #14 of 18 (permalink) Old 10-04-2008, 07:12 AM
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It gets messy when the gov't starts picking winners and losers, but it does increase gov't employment. Just wait until it starts deciding alternative fuels providers along with the infrastructure. See Pickens.

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post #15 of 18 (permalink) Old 10-04-2008, 07:24 AM
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Shocked and disgusted. Betrayed.
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post #16 of 18 (permalink) Old 10-04-2008, 07:53 AM
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From the IBD's opinion page, remember they are very right biased, but that doesn't mean they are incorrect, just that one should assume that bias when assessing the value and objectivity of the piece. I think they are too inclined to blame Carter/Clinton and to laud Reagan, but it would be encouraging if their forward look is correct:

Financial History: Those who don't know history are destined to repeat its serious mistakes. Today some have asked if we could have another 1929-like depression. No, it should not happen.

Those who don't know history are destined to repeat its serious mistakes. Today some have questioned whether we could have another 1929-style Depression. The answer is no — at least, it shouldn't happen.
Then we had over 25% unemployment; now it's 6% and could move somewhat higher, which is typical for economic corrections. Then, by 1934 about one-half of mortgages were in default, today it is only 6%. Nearly 94% of homeowners are still making their monthly payments.

America is far bigger today, more diversified, productive, innovative and resilient and the government's rescue package will help stabilize our banking credit system and economy for the benefit of all Americans. The price of oil and other commodities has topped, so interest rates can and should be lowered, helping all consumers.
Understanding history now is absolutely vital: How did we get where we are? What was the real cause, what were the true reasons behind our current subprime real estate loan mess — and not what politicians are now attempting to falsely claim? Finally, what are the most serious threats America will face in the next five years?
The reason we shouldn't have another 1929 is our Nasdaq composite (the stock index that includes America's modern-day entrepreneurial leaders) already had its 1929-like break in the three years from 2000 through 2002. Since then it put in a strong five-year recovery up to last November. That recovery was due to the broad-based, and highly successful, tax cuts pushed through by President Bush in 2001 and 2003. We are now in the midst of a normal cyclical market correction, with the economy having created 9 million jobs since the 2003 tax cuts.
The Nasdaq's price action since the 1990s, like clockwork, closely parallels, tracks, and eerily replicates the Dow Jones Industrials' wild speculative run-up to its 1929 bubble peak, the ensuing three-year, 88% collapse to the Depression lows in June 1932, followed by the recovery run-up to 1937 and the ensuing sharp correction. Based on historical data, today's market is likely to be a repeat of 1938 — not 1929.
To show what we mean, the accompanying chart overlays the Nasdaq index from the early 1990s to October 2008 with the Dow industrials chart from the early 1920s to the end of 1942.
Maybe you're surprised to see these two indexes seem so remarkably similar — both their up cycles and their down cycles. The reason for this is simple: while technology continually changes, human nature remains the same. The stock market is human nature on daily display, and history continually repeats itself.
Psychologically, the roaring 1920s were just like our "anything goes 1990s." America had just won World War I (the war to end all wars). It was the auto and airplane age, the radio was invented and speakeasies boomed.
Likewise, in the 1990s we had just won the Cold War when the 70-year-old Soviet Union disintegrated onto the ash heap of history as Ronald Reagan's successful policy of "we win, they lose" replaced containment and the nuclear doctrine of Mutual Assured Destruction — dubbed "MAD."
The "peace dividend" resulting from sharp cuts in defense spending helped Bill Clinton achieve a balanced budget. It was the new age of the Internet, biotech and high tech stocks. For nearly five years, prices on the Nasdaq soared. Indeed, to its peak the Nasdaq increased 2 1/2 times what the Dow Jones industrials did during its 1920s climax run.
But those astronomical Nasdaq price gains culminated in the Clinton stock market bubble, which burst in early 2000. Within the space of months, an estimated $8 trillion in U.S. stock market wealth was erased.
So how did we get where we are now? What was the real true cause of the current subprime real estate debacle that endangered not only our entire financial system, but put so many lower income people out of their homes and forced the government to an emergency rescue package?
Every American should know the truth about who engineered the rules for this extraordinary mess so that we all learn a valuable lesson. We need to be much smarter the next time around.
In 1977, President Carter and a Democrat Congress created the Community Reinvestment Act mandating that banks must meet the credit needs of everyone in the banks' community, including uncreditworthy borrowers. It was done for a good social purpose and had the greatest intentions — expanding home ownership. And, through the 1980s and into the 1990s at least, it seemed to work.
However in 1995, President Bill Clinton imposed more and stronger regulations and performance tests. These coerced banks into significantly increasing their loans to low-income borrowers in economically-troubled communities, or face possible fines and expansion restrictions.
These new rules encouraged banks to bundle their risky subprime loans together with prime loans and re-sell them in packages to other financial institutions, thereby freeing the original lenders from any further risk. Thanks to the new rules and oversight from the CRA, Fannie Mae and Freddie Mac got involved in a big way, buying literally trillions of dollars of the questionable loans from banks and feeding the dangerous cycle that had begun.
Eventually, it turned into a kind of pyramid scheme that overwhelmed some lending organizations when housing prices softened in late 2006 and 2007.
So what's the big lesson to be learned here by the public? That this financial crisis was the result of yet another Big Government program that had great intentions but created devastating unintended consequences that hurt millions of people.
It was not the fault of African American groups, which naturally want to help their people. Nor was it the fault of America's free enterprise system, or a lack of enough regulation. No, it was Big Government once again trying to run a private industry.
You can't take one dollar and loan it 50 times. Watch out when Big Government spenders tell you they can run our entire medical industry, give you far better care and save you lots of money.

When devils will the blackest sins put on, they do suggest, at first with heavenly shows - Othello
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post #17 of 18 (permalink) Old 10-04-2008, 10:52 PM
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Bailout bill loops in green tech, IRS snooping

Bailout type Cost to taxpayers (Source: Reuters)
Financial bailout package approved this week up to or more than $700 billion
Bear Stearns financing $29 billion
Fannie Mae and Freddie Mac nationalization $200 billion
AIG loan and nationalization $85 billion
Federal Housing Administration housing rescue bill $300 billion
Mortgage community grants $4 billion
JPMorgan Chase repayments $87 billion
Loans to banks via Fed's Term Auction Facility $200 billion+
Loans from Depression-era Exchange Stabilization Fund $50 billion
Purchases of mortgage securities by Fannie Mae and Freddie Mac $144 billion
POSSIBLE TOTAL $1.8 trillion+

Last week, the Bush administration proposed a three-page bill to bail out Wall Street to the tune of $700 billion. It died in the U.S. House of Representatives earlier this week.

On Friday, though, the House approved a far bigger, broader, and beefier version of the bill--which has ballooned to a remarkable 442 pages. The vote was 263 to 171, with the bulk of the opposition coming from Republicans. Because the Senate already approved the measure, it immediately went to President Bush, who signed it into law.

On the theory that this would be a way to convince previously skeptical Democrats to approve the measure, one large chunk of the bailout bill is devoted to renewable energy, energy-efficient appliances, and so on (the "Energy Improvement and Extension Act of 2008"). The authors lured Republicans with protections from the alternative minimum tax (via the "Tax Extenders and Alternative Minimum Tax Relief Act of 2008").

That includes, as the New York Post pointed out, millions in tax breaks and related pork for kids' wooden arrows, Puerto Rican rum producers, auto race tracks, and corporations operating in American Samoa. (The likely explanation for the latter: StarKist has a large tuna-canning operation in American Samoa. And StarKist's parent company happens to be located in the district of House Speaker Nancy Pelosi.)

The bill has become, in other words, something almost unrelated to the business of bailing out Wall Street. The Beltway term for this is a "Christmas tree bill," meaning everyone gets to hang their favorite spending projects on it--though by the time Congress gets it through, it more closely resembles a slop bucket.

"We will not Christmas-tree this bill," Sen. Chuck Schumer, a New York Democrat promised a few days ago. "The times are too urgent. Everyone has their own desires and needs. It's going to have to wait."

So much for that idea.

Here's a look a some of the green-tech measures:

• One-year extension for wind and refined coal energy tax credits. A production credit for electricity produced from renewable marine energy sources (meaning through wave power and river power, or by exploiting the differences in ocean temperature). Energy credits for "small wind properties," geothermal heat pump systems, and energy-efficient residential properties.

• New renewable-energy bonds. Up to $800 billion in energy bonds may be offered to the public, with a third from "public power providers," a third from governments, and the remainder from "cooperative electric companies."

• Tax credits for "cellulosic biofuels" and for "carbon dioxide sequestration." An extension of an alternative fuel credit. Tax credits for "new qualified plug-in electric-drive motor vehicles." Bicycle commuters get a nod, as do regulations aimed at "residential top-loading clothes washers."

IRS undercover operations: Privacy invasion?
The bailout bill also gives the Internal Revenue Service new authority to conduct undercover operations. It would immunize the IRS from a passel of federal laws, including permitting IRS agents to run businesses for an extended sting operation, to open their own personal bank accounts with U.S. tax dollars, and so on. (Think IRS agents posing as accountants or tax preparers and saying, "I'm not sure if that deduction is entirely legal, but it'll save you $1,000. Want to take it?") That section had expired as of January 1, 2008, and would now be renewed.

Starting with the so-called Anti-Drug Abuse Act in 1988, the IRS has possessed this authority temporarily, with occasional multiple-year lapses. A 1999 internal report said the IRS had 126 "trained undercover agents" working in field offices at the time. This is the first time that such undercover authority would be made permanent.

Sens. Max Baucus (D) and Chuck Grassley (R) have been pushing to make it permanent for a while, claiming (PDF) in April that: "Undercover operations are an integral part of IRS efforts to detect and prove noncompliance. The temporary status of this provision creates uncertainty, as the IRS plans its undercover efforts from year to year."

There's another section of the bailout bill worth noting. It lets the IRS give information from individual tax returns to any federal law enforcement agency investigating suspected "terrorist" activity, which can, in turn, share it with local and state police. Intelligence agencies such as the CIA and the National Security Agency can also receive that information.

The information that can be shared includes "a taxpayer's identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer's return was, is being, or will be examined or subject to other investigation or processing, or any other data received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return."

That provision had already existed in federal law and automatically expired on January 1, 2008.

What's a little odd is that there's been little to no discussion of the IRS sections of the bailout bill, even though they raise privacy concerns. Treasury Secretary Henry Paulson said this week: "I will continue to work with congressional leaders to find a way forward to pass a comprehensive plan to stabilize our financial system and protect the American people by limiting the prospects of further deterioration in our economy." He never mentioned the necessity of additional IRS undercover operations.

The bailout: Details, controversy, and loopholes
As my colleagues over at reported on Friday, the law authorizes the Treasury Department to create a so-called Troubled Assets Relief Program, or TARP, as well as a separate insurance fund.

The TARP program permits the Treasury to purchase mortgage-backed bonds or any other "troubled assets" from financial institutions. The idea is that because banks have become so hesitant to lend to each other, this law will help unstick the gears of the modern financial economy.

Some loopholes exist. It's possible for a bank to buy $100 billion of bad debt--perhaps in the form of subprime mortgages that are becoming quickly worthless-- declare bankruptcy, and sell it to the Treasury Department for $120 billion, or $200 billion. In other words, although the Treasury Department is supposed to look out for the best interests of taxpayers, there's no law forbidding such profits in the case of firms involved in bankruptcy, receivership, or mergers.

The Treasury Department is authorized to "guarantee" home mortgages, essentially becoming a kind of co-signer, to reduce the number of foreclosures. If the home owner stops paying his or her mortgage, taxpayers would be on the hook. The Treasury Department can also eliminate a "reasonable" amount of a home owner's mortgage debt, under section 109 of the new law, which would likely delay the process of house prices falling.

In response to grassroots pressure from Americans upset about Wall Street executives cashing in, Section 111 is titled "Executive Compensation and Corporate Governance."

It does not include, however, any statutory dollar limit on how high executive salaries of TARP bailout recipients can be. Instead, it lets Treasury Secretary Henry Paulson, the former CEO of Goldman Sachs, come up with "appropriate standards." In addition, only the top five executives will have their golden parachutes limited; all the rest will remain untouched, even if their second-tier salaries and bonuses happen to be in the millions or tens of millions of dollars.

Bear Stearns CEO James Cayne made $61.3 million from selling his shares a day after the JP Morgan bailout. Daniel Mudd, CEO of Fannie Mae, was replaced last month; he made $11.6 million in 2007. Richard Syron was chairman and CEO of Freddie Mac from 2003 until last month. He made $19.8 million last year. Martin Sullivan was ousted as president and CEO of AIG this summer, and was paid a $47 million severance package.

While salaries of failed executives will have no statutory limit, TARP-participating companies will lose a tax deduction if they pay their top executives more than $500,000 a year. The $500,000 limit only kicks in if the company offloads over $300 million in assets through TARP.

Section 115 of the law says that the administration can, after notifying Congress and waiting 15 days, purchase and hold $700 billion of assets "at any one time." (It can buy and hold $350 billion without waiting.)

This, too, is a potential loophole. It permits the Treasury Department to buy up, say, $700 billion in 2008, sell those assets off gradually over the next year at a (probable) loss, and repeat the same process in 2009. Losses to taxpayers, in other words, could exceed $700 billion. Although the Treasury Department is instructed to try to avoid losses, the text of the law does not forbid that scenario.

If the TARP ends up costing taxpayers money, the president may ask Congress to consider enacting a law to recoup "from the financial industry an amount equal to the shortfall," presumably through higher taxes. But Congress is under no obligation to do anything; a mechanism to cover the shortfall does not exist in this law.

Even though FDIC coverage will be boosted from $100,000 to $250,000 per account through December 2009, premiums to banks may not take "into account" the higher account coverage. In other words, premiums can't increase for that reason.


• This may be just the beginning of bailouts. California Gov. Arnold Schwarzenegger said Thursday that the state may need a $7 billion loan from the U.S. Treasury, according to a report in the Los Angeles Times. That's because the state has spent more than it takes in through tax revenue, with an annual budget deficit of $14 billion or more, even though its individual income tax rate is arguably the highest in the nation.

• CBS News' John Bentley reports from Arizona that Republican presidential candidate John McCain is taking some credit for the bailout's passage: "I'm glad I suspended my campaign and went back to Washington to bring, and help bring, House Republicans to the table," he said on Friday. Democratic presidential candidate Barack Obama described the law as "absolutely necessary to prevent an economic catastrophe."

• Rep. Ron Paul of Texas, who correctly predicted in 2003 that taxpayers would be "forced to bail out investors," said in a speech on the House floor that the legislation would "only further harm the economy" and was actually worse than the previous version. In a CNN interview, the former Republican presidential candidate said his colleagues are refusing to deal with the underlying problems and spending more tax dollars even though "this country's bankrupt."

• The Dow Jones Industrial Average (-22 percent year-to-date) and the Nasdaq composite index (-27 percent) closed on Friday down 1.5 percent, despite the bailout. Gold ended at $834.80 an ounce, slightly up for the day and the year. Crude oil futures ended at $93.88 a barrel, slightly down for the day.

• U.S. jobs fell by 159,000, a decline of 760,000 this year. Technology firms have also contemplated hiring freezes and some, including Hewlett-Packard and Dell, have already laid off employees, as my colleague Ina Fried reports in a separate article.

Bailout bill loops in green tech, IRS snooping | Politics and Law - CNET News
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post #18 of 18 (permalink) Old 10-05-2008, 09:52 AM
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Just AS WE Thought!!!!Citicorp bribes a judges get's a injunction against Wells Fargo

Well our government inlcuding our judicial system is out to bankrupt America! Citicorp has temporarily won an injunction against WellsFargo temporarily to stop them in their buy out plan! I told you so and I'm sure you all saw it coming! The judge was bribed because the people in D.C. won't make the money or have the shares they could've had without Citicorp buying Wachovia.....

God Help US!
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