huskerbob

U.S. Government's Plan for Banks - Ready, Fire, Aim

It's hard to imagine why anyone would expect anything different. Please name all of the projects (and there have been many) where the government spent billions with sound oversight, no corruption, no cost overruns, and effectively achieved their goal. Look at any spending project in the last, say, 20 years. To expect anything different is insane. Like any other big spending project under an ass or an elephant, there will be favoritism, corruption, misuse and misallocation of tax dollars, and all sorts of general asshattery.

Krugman vs. Sachs on PPIP Loopholes

If you think of this as a problem, you're missing the whole point of this plan. It's simply a fig leaf so the banks can foist their toxic or "legacy" debt onto the taxpayers. This has been the plan since the beginning of the bailout, only Geithner came up with a politically more palatable plan. Expect a lot of cheesy fake "outrage" from your appointed political representatives in Washington after the banks safely game the system. Maybe they can trot out AIG execs for another round of excoriation?

Exclusive: Big Banks' Recent Profitability Due to AIG Scam?

Was this all a scam from the start? Certainly GS and friends weren't dumb enough to think that AIG had enough assets to cover all the protection they were selling, or would be able to honor a fraction of it without going under. So where did they expect the money to come from?

Why Goldman Sachs Should Return Its TARP Money

I doubt that goldman sachs relationship with our government has been so stormy, as you say. With their former CEO running Treasury? Are you kidding?
They have their billions funneled through AIG, and will now get to play with money leveraged by tax dollars. I don't think they will "put pressure on other firms to get healthy fast", it will put pressure on them to hire more and better connected lobbyists. GS got better because it's hogging all the medicine.

Turning Toxic Assets into Gold

Whoops! You forgot to mention that Mike also owns a condo in Miami, 4 in Phoenix, and 12 in Las Vegas (stated income loans don't you know).
He stopped paying on 5 of them 4 years ago, but these mortgages can be resurrected for sale, along with any other non performing junk the banks can dig up.
It seems highly unlikely that the US government is the only entity to correctly see the value of these products. The whole point of this exercise is to overpay for the assets. Private investors will buy on their own for the right price, but why should the banks take a big loss? The only loser should be the middle class, so that's what we're gonna do.
I guess the value is such a slam dunk, we are going to make no recourse loans with the taxpayer's money!
These assets aren't toxic, just overpriced.
Why not just do the same thing for homeowners? Let the government use your tax dollars to help investors buy your neighbor's house at 2006 prices. It's just as stupid, and it will buy a lot of votes.

10 Reasons Why We Still Haven't Hit Bottom

Great article, many good points.
On point #2, the Fed can't fix liquidity on the lending side, they can only make money so cheap that they give it away to anyone with a pulse. Which is partially how we reached this point. Maybe the market will bottom when the government, not the investor, capitulates.

Why Citi's Failure Costs More than Saving It Does

I guess what you're saying is that citi doesn't have more than $2 trillion in assets. Typically a greater amount of assets would not entail more expense in making creditors whole. But apparently bank assets are actually a liability, otherwise a pile of "assets" exceeding the deposit base by three times would not be so cringeworthy.