Watch this video of Costanza and picture him as Bernanke or Paulson or the President or any almost any other politician.
What would happen if we told the truth in this country? What would happen if we told the average American citizen the truth about what might happen during the “crisis”, “meltdown”, “financial Armageddon”, or whatever vague but scary term they feel comfortable using?
Your representatives are too afraid to tell you the truth. Is that why you voted for them? Is that their job - to protect you from the truth?
As I have remarked before - apparently the oath that goes something like “Do you swear to tell the truth, the whole truth and nothing but the truth?” does not need to apply to politicians or Secretary Paulson or Chairman Bernanke.
Two weeks ago (before we had this TARP proposal), I asked some of the media who read this blog, to do something…I wanted them to ask the powerful people to Describe A Meltdown. Here is the post:
Would someone in the “real” media please ask Bernanke or Paulson or Bush or Dodd or Frank or any other person in power these questions?
Sir/Madam: You keep saying we had no choice but to do this bailout to avoid a cataclysmic meltdown of the global financial system. Don’t just make a vague reference to a “meltdown”. In great detail, please explain exactly what you mean by this? What would happen exactly? What would be the series of events? Who would be involved? Who would get hurt? What would happen to the average person who is paying for these bailouts?
I am confident this kind of questioning will not be likely. And if it is, they won’t answer it because they might either scare the very markets they say they are protecting or it might show they have no fucking clue what the risks are or it might show that they know where the risks are but they don’t want to go on record and have to explain what they didn’t do in the past to prevent it or what they did in the past to create this mess or what they will not do to prevent another “meltdown.”
Instead, we just get these wonderful statements from the politicians telling us how they just protected us from “a crisis” that was just about to happen. Feel better?
We have two choices:
- Don’t ask questions. Accept vague answers. Accept it when they say “no comment”. Just trust them.
- Ask tough questions. Hold them accountable for telling the whole truth.
So far I have yet to hear too many people even bother to ask the question. Stephanopolous gave it a try but Paulson decided to avoid answering and just tried to tell us once again using vague but scary terms, like “grave” or “dire” etc. etc. Instead we just see more of the same and more of what the Congressional “leaders” said at the end of last week. Listening to the people briefed by Paulson and Bernanke, they said it was frightening and really really scary. Oh My! I guess they were told the truth. But they refuse to tell us word for word what they were told. They also refuse to ask Paulson or Bernanke to repeat word for word what was said behind those closed doors. You can’t handle the truth. Instead you are getting “protected” and you just have to take their word for it. Scarrrrrry, really really scarrrrrry! Just believe us!
Some politicians during the past two days have explained how their constituents are opposing this legislation because they don’t understand what doing it or not doing it will mean to them. EXACTLY!!!!! Until average Americans who don’t speak politish or acronymese or know what securitization is or what derivatives are or any of that stuff that smarties like Paulson and Bernanke and their politicians love to discuss….. well, until the truth is spoken they will not support this bailout. Saying that the economic statistics will be bad or that people will find it hard to buy a car is not very scarrrrrry to the average guy. Saying the economy will “weaken” or “suffer” is not personal enough - it does not hit home and it does not portray an immediate danger.
They want your money. $700 billion of it on the low end. Shouldn’t you be able to hear the truth? Apparently, you can’t handle the truth!
Well, whether you can handle it or not is your issue. Whether you believe what someone says might happen is also your issue. I’ve been telling my family and friends for months and increasingly over the past few weeks and days exactly what I think will happen. A long time ago (before Bear Stearns), I was laughed at quite a bit as being a touch crazy. Lately, the usual response is just a look of disbelief and a question like - “Do you really believe that?”
So here is a sample of what I think will happen. In the short term, I expect that the financial system will come to a halt and not just in the US. Our economy is based upon credit and credit payment systems. What does that mean to the guy in Iowa? What do you think will happen if you cannot use your credit card or your debit card or a check or gain access to your atm? What if you don’t have cash or a means of payment to buy food or pay for gas? What desperate things will people do? Think it through and find your own truth.
You might decide it is worth it to support this TARP bailout. You might not believe something like chaos and anarchy is possible because of a “financial crisis” so you might decide to continue opposing it. If you were told the truth about what might happen from your leaders, you would be able to make a decision.
Regardless of the decisions you make or the decisions that Congress makes, there is a deeper truth. You have to determine whether a government bailout will entirely remove the risks to the average person or whether it will just postpone the inevitable. Is that worth $700 billion+ to you?
This article has 27 comments:
That's what I assume Paulson wants us to think.
If this is actually true nobody knows. It's one of those things where observing the experiment changes the outcome. Have you heard that economists have predicted 13 out of last 3 recessions? It's kind of like that.
On the flip side, had Greenspan not been asleep (and drooling) at the switch, he'd have raised rates a lot sooner and pushed for increasing regs on the mortgage industry long before this thing bubbled up into the current situation. Too many people saw this coming, yet Greenspan kept saying the housing market was overheated only in certain regions and not on a nationwide basis. Problem is, the real estate in those overheated regions were of enough value to take the system down.
Language from Section 8
Treasury Financial Bail-out Proposal
This smells of the Patriot act, the war in Iraq and all of the other things our nation has been hustled into since Bush took Office. Big bills making sweeping changes, no one accountable, fear the main reason for passing it fast without debate or, in some cases even time to read the damn thing. This deal has been hanging out there for years and all of a sudden "its a crises". I say give the GAO time to look at it and report on it.
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In addition to the procedure prescribed by the constitution, laws of the Reich may also be enacted by the government of the Reich.
Laws enacted by the government of the Reich may deviate from the constitution as long as they do not affect the institutions of the Reichstag and the Reichsrat.
Laws enacted by the Reich government shall be issued by the Chancellor and announced in the Reich Gazette. They shall take effect on the day following the announcement, unless they prescribe a different date. Articles 68 to 77 of the Constitution do not apply to laws enacted by the Reich government.
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Paulson is a dangerous narcissist, Bernanke his enabler. Have no fear of the economy, as Main Street always recovers. But be very afraid of Herr Paulson.
And Fanny and Freddy were already under the auspices of the federal government. They did such a good job overseeing them that they are in the situation now.
Do free markets sound feasible? I am sorry for the thousands of people who bought homes beyond their means and now will lose what they thought they were creating. But you get nothing for free.
My conclusion, let the markets find their own way. If it means recession we should emerge stronger -- if it is anything less than that then so much the better.
Do not believe the liars and self-serving folks up in Washington. If they were so smart they would have prevented this from ever happening. We need to control our own destiny for a change.
Stick to principles you believe in! Problem is, YOU and I allowed THIS gov. to create Fannie and Freddie.... They removed risk in these loans by guarantee thereby giving the banks the green light to make easy money!
I'm SO frustrated... here we go:
1. Fed/greenspan cuts rates to spark artificial demand of housing
2. Gov. fannie/freddie guarantee loans.. REMOVES RISK
3. Banks got nothing to lose! Gov. on hook... loan it!
4. Congress wants poor and minorities in houses...loosen restrictions
5. Loans guaranteed so get creative 7yr ARMS
6. introduction of 'newly' financeable people in market
7. supply flat... price skyrockets
8. all is good for 5-6 years...
9. all idiots buying too much house does so...
10 You are reading this post
Certainly, Mike's right. We've been blustered and threatened, lied to and kept in the dark. I'm starting to think that the Black Hats threatened committeemen behind closed doors. Support TARP or else.
"Listening to the people briefed by Paulson and Bernanke, they said it was frightening and really really scary... But they refuse to tell us word for word what they were told."
See what I mean? They have dossiers with x-rated photos, witnesses, and phone tap transcripts. Remember what happened to Spitzer.
The banks don't have any more than 10% of what they need to cover everyone's balance due. It would put them ALL under water and then the bailout plan would be a back burner item.
Added benefit is that having the cash would allow you to continue buying stuff without worrying about whether your bank is 'safe' or not.
Just a thought.
Got Cash?
Now we're supposed to "just trust" them with $700 billion? And do keep in mind that Bernanke was the one who stated that we were not in a real estate bubble.
Why should we trust these guys?
Again like the Author said, there is No Guarantee. It is the Best Plan they have so far. They better put pen to paper make agreements and get on with it before we end up w/a Massive Run on the Banks & which pt as the Author says...They will simply have to shut the System down.
Let me see ya buy an Air Conditioning Compressor w/Chickens...
Main St will be fine? This CRAP is in ALL the PENSION FUNDS, Mutual Funds, Insurance, Bank Reserves, your 401K.
This problem is like pouring cream in coffee. When you 1st pour it in you can see where it is. I think this is how it started out 15-20yrs ago. Then as time went on they stirred the coffee & it ended up mixing w/everything in the cup. Add more & more cream, you eventually end up w/a cup of Cream which is Coffee Flavored. Coffee being Real Cash-Cream being paper that represented value on some transaction, which has been easy to trade between Financial Institutions. We hit the wall when some of the cream went bad-Now, it's spoiled the cup! Thats my easy explaination, I hope the Government comes up w/a much better one.
For the REALLY paranoid:
You'll have to get the cash first (for this you'll have to call ahead, wait a few days and then they'll treat you like a criminal that you are, you think it's your money you are taking? NO, it's Paulson's money, apparently :)
but then you'll have to spend this money before it becomes worthless. buy gold before they forbid you from holding it.
It will be nearly impossible for most to do this right. You'll leave paper trail and may be later found guilty of trying to escape your responsibility as a citizen to surrender any and all savings you might have to help GS.
WAIT A MINUTE
The Leveraged Debt Industry Just Died, and the Feds want you and I to revive it?
I doubt anyone can revive it. I believe the death of the 'industry' has been decreed, and nothing can be done.
Folks, this has been fun. Now can we please all go back to producing real goods and services and saving and investing our earned (not borrowed) income.
nice synopsis.
The government should act as a caretaker to continue to receive current mortgage payments to be paid into an escrow account, which will be added to the value of the house. Houses should be put up at auction, like any estate sale. People in the homes should get first option on refinancing their home at reasonable market rates against the original value of the mortgage or the auctioned value, whichever one is LOWER.
when investment banks go bankrupt, the requirement for the function will still be there, and investment money will flow into the vacuum and replace the old banks with new organizations that will be fully seized with the business risk associated with the sector. money will flow into the defunct sector much like settlers leaped at the opportunity of the Oklahoma land rush. Buffet would leap at the opportunity to occupy that business sector especially if jump started by the inevitable government money.
the last people on earth to be entrusted with public money to bailout Goldman Sachs are former CEOs of Goldman Sachs and the elected representatives who have been bought and paid for by investment bank campaign controbutions. they have already proven decisively that they are not trustworthy stewards of public money and trust. dont throw good money after bad.
who in their right mind would risk loaning money at current rates of interest. it's nuts. but the problem is the lender can't charge what the consumer can't pay.
i also believe that credit markets will not shut down. but the cost of credit will go up regardless of what the fed wants to do or trys to impose. credit will not be available to a wide swath of the population at any price...they're the walking dead financially speaking.
the implication on government are also profound. they will pay much higher interest and our budget will be consumed by it.
hard times are here my friends. we've come to rely on cheap and plentiful credit to drive our economy and those days are over. and there is absolutely nothing bush, paulson and bernake can do about it.
e.g . " The war in Iraq was a dire mistake justified by lies"
"Oh - do you want Sadam back - yes or no, yes or no?! "
Er no er but......................
Now its "This plan is not the right plan , there are alternatives that need full discussion, and its scrapping the constitution"
" Oh? do you want financial armageddon - yes or no- quickly now"
The following Vietnam War Fighter Pilot JARGON key is provided in order to expedite discussions and reduce confusion with John McCain concerning TARP
Agent Orange: A toxic equity tranche
Body Count: Number of bankers fired
E&E: Escape and evasion tactics: Often applied by Wall Street CEOs and politicians
Hootch: What investors smoke before they visit Bear Stearns and Lehman
Gook: What you will find in Lehman and AIG's financial footnotes
Level 3 Asset: Covert assets
Cumshaw: OTC trading
Crispy Critters: Exploding Hedge Funds
Water torture: Forced to read ISDA standard terms
DC: Dick Cheney then, Dick Cheney now
Deuce and a half: 250 Trillion dollars
C Rations: Stale sandwiches from Kaplans deli.
AWOL: Chairman Cox during the runup of the great meltdown.
Delta neutral: A Wall Street hedging strategy not to be confused with Mekong Delta.
Oversight: What Congress must do: Excuse us for the oversight.
AAA: Anti Aircraft Artillery/ also Rating Agency Jargon
AVRN: Already Very Rough Numbers
Go juice: Prune juice
Chop Shop: Workout firm
M&A: Mission Accomplished!
HUD: Heads up display (Housing and Urban Development, where the subprime mess started)
Ho Chi Minh Trail: AMTRACK
HMONG: A friendly Vietnamese tribe (on Wall Street: Honor "Hmong" thieves)
Golden Parachute: Every pilot and CEO must have one
Tailhook: The contingent liability payable under a CDS
SAM: Securitised asset markdowns
Million Dollar Wound: A wound not warranting bailout money
Bandits: Short sellers
Jesus Bolt: The nut that holds everything together (Hank Paulson)
Gigahertz and Nanoseconds ~ Highly technical, detailed, and hard to understand ("It's getting down to gigahertz and nanoseconds.")
Lost the Bubble ~ Got confused or forgot what was happening. Alan Greenspan lost the bubble.
Loud Handle ~ Lever or grip that fires ejection seat. Often used by Wall Street CEOs.
LTCM: An early Wall Street ICBM
Peter Pilot ("PP"): Affectionate name for inexperienced pilot newbie or Vice Presidential running mate.
PSY-OPs: Whitehouse tactics
R&R: What Congress takes every 3 business days and what George Bush does for a living.
POW: Prisoner of War: Wall Street-Person of Wealth
ReTARP: He who will explain the next Wall Street Bailout
Re-Education Camp: Where investment bankers go to learn about the real business world
Selling short: What the US government does to its Armed Forces
Smoking Hole ~ A bottomless write off.
Spiderhole: Where W emerges once in a blue moon
TOP Gun: A derivative salesman
Tunneling: What hedge fund managers do to opaque financial reports
Tunnel Rat: SEC short hunter
Up on the Governor ~ When someone is about to have a tantrum (term comes from the device that keeps the engine from overspeeding).
Up to Speed, or Up to Snuff ~ To understand or to know what's going on.
Swiftboating: There you go again ;-)
Unknown Unknowns: The OTC derivatives market
FWMD: Financial Weapons of Mass Destruction
Zero Dark 30: Operations between 12AM and sunrise (Going to the printers)
Brought to you by: WilliamBanzai7
Sub-section 8 of the proposed bailout is the scariest language I have ever seen. READ IT CAREFULLY! What it specifies is that the Treas. Sec. will be held above and beyond the reach of the Constitution itself!
HUH?
Suspend the provisions of the judicial system & the US Constitution for one man? This is ABSURD, and should be considered cause for treason charges. NO SUCH AUTHORITY should EVER be granted in this country, for any reason. We have not/do not/will not recognize the powers of a "king!" That is our history, our responsibility and our legacy!
Appalling, scary, illegal, absurd, disgraceful! THOSE are the key words of the bail-out "message," and should be resisted!
Folks, this is dangerous wording!
have you checked out NRA memberships... wow... and check out your local gun dealer - Gun Sales are way up there like going through the roof...
Gee, and all because of some international terrorists,
and they aren't Arabs. google Barry Jennings video