Geithner Plan: Terrible for Taxpayers

Tim Geithner’s recent plan is just another in a series of ridiculous and infuriating bailouts for Wall Street. I am not surprised, because Geithner is nothing more than a Wall Street lackey, working for the interests of the bankers and not the American people. Ceny Uygur from The Young Turks, does a great job at explaining the latest plan and why it is horrible for American taxpayers.

At least some elements of the left are willing to criticize and call out the Obama administration, rather than toeing party lines and placing blind faith in whatever the Democrats want to do. People are slowly starting to awaken and understand just how bad they are being screwed. The assets are “toxic,” whether you relabel them “legacy” or something else. I’ve said this before and I will say it again, LET THEM FAIL. Apologies for the caps, but it disgusts me that our government is allowing the losses from bad bets and toxic assets to be placed at the heels of the taxpayers and future generations. When the bankers’ bets made them billions of dollars, it was fine. When the irresponsible bets came home to roost and created huge losses, they want to stick the taxpayer. It is wholesale theft and only increases the chances and proximity of hyperinflation. Stay long precious metals and other commodities.

Comments

[Lassi:]

Short strategies with commodities took a hit when plan was announced, but I can agree with Jason that long strategies may pay if FED keeps on printing the money to finish their plans and to create confidence.

Mar 25 07:48 AM

[wg:]

Ah, but you have to remember that most Americans are NOT taxpayers.

Mar 25 09:01 AM

[reluctantQuant:]

Got rant?

Easy for a goldbug to scream "let them fail." You think AIG is a freakshow? Go ahead and crash a money center bank - ever worked in one? For starters, try simultaneously shutting down lockbox and cash transfer for 40,000 small & mid-sized businesses. Ever actually seen what happens to the instituitonal payment systems when a firm seizes up? Saw it with Drexel, almost perfect repeat with Bear and Lehman. Yep, let's do a big bank, hard and fast. I'm sure it will be good for the country.

This is like saying your 15 year-old child just called from Rikers Island at 3:00 am, and you decided to leave them there to teach them a lesson. Great strategy.

Hopefully that long gold position is settled physical delivery.

--rq

Mar 25 09:46 AM

[carolinacoast:]

Don't you think that if the answer was as simple as "Let Them Fail", someone with much bigger clout would have taken it to the Hill? What are you thinking? You, and people in that Limbaugh driven 2D world, think that the picture is always so much simpler than what it really is. Your article must be for the sake of antagonizing the avg SA blogger.

"Apologies for the caps, but it disgusts me that our government is allowing the losses from bad bets and toxic assets to be placed at the heels of the taxpayers " and it disgusts me that as Americans we're still fooled by those we put so much faith in. "Eight years of looking the other way", good job.

Mar 25 10:07 AM

[Mad Hedge F...:]

No one seems to care anymore. I’m sorry I’m late getting my comments out today, but I had to get my application in to manage the Treasury’s latest $1 trillion bailout program. They’re due April 10, and I wanted to get mine in ahead of Black Rock’s and PIMCO's. I only have to show $10 billion in assets under management and the ability to raise $500 million. For this, the FDIC will effectively lend me interest free long term loans to buy all of the toxic assets I want at deep discount prices with 6:1 leverage. I’m sorry, but I can’t resist those “heads I win tails, you lose” trades the Feds are offering, hence the rush. This certainly takes nationalization of the banks off of the table, and makes those buyers of Bank of America (BAC) two weeks ago at $2.50 look pretty smart. The government has now shot its wad, and there is really nothing else they can do now but sit back and pray until the $3 trillion in stimulus/bailout/reliq... they have committed to starts to work.

Mar 25 01:55 PM

[henarl:]

No thinking person wants to see the banks (or even AIG) disintegrate into a Chapter 7 type of bankruptcy. However, a Chapter 11 type of bankruptcy where they continue to do business but with different management than that which got them into this mess, and with different rules and regulations to control the over leveraging, derivatives, no-doc loans, securitization, etc. might be a good idea. Unfortunately, self regulation has proven disastrous so maybe the government or the courts are needed. We need the banks but we don't need them to operate like casinos.

Mar 25 05:10 PM