PainfullyAware

U.S. Profits from Bailed-Out Banks

On Sep 01 09:34 AM whisperonthewind wrote:

> PainfullyAware, the government doesn't make money, it takes money.
> It doesn't earn money because it doesn't work.

Things Have Become "A Bit More Grey" than your definitive "Government Does Not Make Money".

Congress Abdicated its responsibility for "Coining Money" To A Private Entity - The Federal Reserve - which does "Make Money";. Not for the benefit of the citizen but for the benefit of the "Club".

I agree that Government only leaches and does not "Provide Value With Recourse Or Reciprocity For Failure" In Regard To "Money Creation".

However, Fiat Monetary Policy and Fractional Reserve Banking DOES Create Money. (even If It Is Fictitious and Not Tied To Any Finite Quantity.)

U.S. Profits from Bailed-Out Banks

Government "Made Money" from the "Magic Money Fountain" of the fiat money system and the implementation of the "Shell Game" by its select TARP Banks.

4 billion to date => 4.1667 billion per year => Only 336 Years to Go Until TARP PAYBACK => Only 2880 Years To Go Until Pay Back on The 12 Trillion.

Yes the rate could increase but it is doubtful that it would by "Honest Business".

If This Is "Making Money", Then The Government Sucks At It.

Why Are Banks Paying Back Loans They Can't Afford?

Agreed - The issue lies in the "Actual Default" of the underling assets and the "Insane Complexity" that Evolved from "Unaligned Interests" of Originators and Securitizers.

In Theory - None Of The Structures I Mentioned, nor the ones I did not, Are "Toxic". However, the current rate of Default and Bankruptcy coupled with the Complexity Issue makes ALL OF THEM Suspect.

In the end (maturity), not all will be worthless. It Is Roulette At This Point.

Based upon my exposure to distressed real estate I conclude that there was a greater amount of "Fraudulent Valuation" than not; further adding to the fire.

Cyanide as a chemical is not toxic, until one is "exposed".


On Jun 11 10:51 AM greedcanbgood wrote:

> Painfully aware - I concur that the difference between investment
> and commercial banks has become more blurred. That said, while most
> of the investment banks are now running under commercial charters
> it does not change (in the immediate term) their current business
> model and thus they remain starkly "different" from thier legacy
> commercial bank peers.
>
> I'm quite familiar with off balance sheet instruments and yet not
> ALL credit default swap contracts or any of the other instruments
> you cited are, by defintion, "toxic." The problem here is that "toxic
> assets" is the latest and greatest buzz word that exists without
> definition. I do agree with you however in that the more these instruments
> are "pyramided" with one another the more difficult it is to asses
> their realitive value - and risk. Yet, that alone does not make
> them "toxic". If you are as familiar with these as you seem to be,
> you would know that they also exist as simple transactions.

Certain Banks Are Still Broke

"Value As You See Fit" accounting is in effect and you believe the "Profit Statements"? Not the wisest action.

Unfortunately it is very difficult to gauge the exposure of banks to the "Off Balance Sheet Assets" - Because They Are Hidden By Being Off Balance Sheet. However - When Default Is "Re- mediated" one can no longer "Mark To Myth" and loss will have to be accounted for. The next logical conclusion for "Forestalling The Inevitable" that our Governments are currently pursuing would be to let the banks become Real Estate Holding Companies as well. Currently there are low limits on this action with stiff penalties. If this Mandate is removed then the banks can take the defaults and continue the shenanigans.

Based upon what I have been exposed to Wells Fargo is one of the "Best" of the "Worst". They did not get as crazy as some.

There Is More To Know Than Can Be Known.

You can come to any conclusion if you limit the data to only that which supports your paradigm.


On Jun 11 11:39 AM DannyBoy153 wrote:

> Any bank? Please clarify some more. C didn't make any money for
> it's common shareholders. And how about all the failed banks? In
> this environment of steep yield curve, how can a bank make money
> if it's not in business? It takes a lot more than a steep yield
> curve to make money.
>
> Mer added $3billion in the first quarter to BAC's bottom line and
> they'll add more earnings in the future.

Why Are Banks Paying Back Loans They Can't Afford?

greedcanbegood

I find it interesting that you say that there is a "Difference" between Investment and Commercial banks, yet the Repeal Of Sarbanes/Oxley Muted The Distinction. Things Have Become Much More Blurred.


Your angling for a better definition of "Toxic Asset" shows that you have not done much research on the subject. I would suggest these for help with your education:

Shadow Banking, Off Accounting Book Assets, Derivatives (Collateralized Debt Obligations - CDO, Comercial Morgage Backed Securities - CMBS, Mortgage Backed Securities - MBS, Interest Rate Derivatives, Credit Default Swaps - CDS), Financial Engineering.

There are others search terms, but this list will give you a head start on your research. The creation and transfer method is what has created the "Unassailable Complexity" and as a result their inability to be "Valued".

There Is More To Know Than Can Ever Be Known.

Good Luck


On Jun 10 02:13 PM greedcanbgood wrote:

> You are WAY off-base TBill. Investment banks are different than
> commercial banks. Do you have a 401(k) plan with your employer?
> I bet you've got some bank stocks in that portfolio. At the end
> of the day, the corporation exists for the benefit of its shareholders.

Certain Banks Are Still Broke

Perry B - To Assume Benevolence IS Foolish.

I fear that you are not paying attention to "Details or Actions". The same abhorrent actions still continue. What is happening now is no different than recent history in action, only it has been brought to greater light by calamity.

The Complexity Of Corruption IS Vast And Is Not Contained In Within Easily Labeled "Clubs".

I fear that you do not understand the long term implications of recent actions.

Are You Comfortable With The Fact That Congress, Nor B. Obama, Had Time To Read The Second Bailout Bill Before They Passed It Into Law? This is just one example of many that is Nefarious in recent history.

I do not care the affiliation of those who hold office or how long they have been there - I Do Care About The Policies They Enact.

Things Are Not Well And The Propaganda Is Disturbing.

Wall Street Breakfast: Must-Know News

I doubt the "Market" will go down with any gusto until the "Banks" finish their capital raise.

Shadow Banking, Dark Pools, and The Presidents Working Group On Financial Markets Still Exist. These entities have no interest in a negative market - at this time. Fill The Money Hole Is The Agenda. Once this objective is complete and solvency assured the populous will receive the news of "We Must Endure The Hard Times; But Hey We Are Saved.".

Tax Revenues Still Tanking, Unemployment Still Rising, Bankruptcy and Default Accelerating - Don't Look At The Man Behind The Curtain.

Safety Is A Function Of Awareness.

The Complexity Of Corruption Is Vast.

Telltale Signs That a Significant Correction Isn't Imminent

"Those of us who have matured past that phase just admit it when we are wrong instead of making up crazy fantasies." - thiazole


When do "Crazy Fantasies" become popular fact?

The Earth Was Flat At One Point In History and Death Camps Did Not Exist In World War Two Germany. Both of these canons of "Truth" were shown to be false => After Further Scrutiny.

Belief and Labels create a construct that does not allow for further evaluation when new data is presented.

conceptwizard gave a synopsis of Actual Entities earlier in the comment thread that have the Mandate And Mission To "Influence" The Beloved Market. Denial of their existence is to relegate their effects as "Magic". There is a much larger and complex interaction beyond the financial realm.

To Assume Benevolence Is Foolish.

The More You Know The Less Certain You Will Become.

October-November is going to be a bit crazy. The true state of Economic Meltdown will be hard to deny and the limit of "Free Money" from the Treasury will be reached. (No, money can not be "Printed" indefinitely; Eventually the math shows that the debt is not serviceable.)

We May Save The Banks But Destroy The Country.


On Jun 03 11:37 AM thiazole wrote:

> Childish is saying "it's a conspiracy" everytime you are wrong (reminds
> me of the children who would make up rules to games as they played
> in order to benefit them). Those of us who have matured past that
> phase just admit it when we are wrong instead of making up crazy
> fantasies.

Wall Street Breakfast: Must-Know News

Yes, In Bankruptcy Cramdown is a valid remedy. However, the policy as discussed has nothing to do with Bankruptcy.


On May 01 03:25 PM BerkeleyBob wrote:

> I fail to see how the notion of a mortgage "cramdown" is bad policy
> in an individual BK, but has been part of corporate BK proceedings
> for years. Contracts are "impaired" in either scenario, no? Might
> not a BK judge be a pricing mechanism for defaulted loans?

Wall Street Breakfast: Must-Know News

If you are correct, then the subjugation of America Is Complete and the ails of the populous matter not.


On May 01 02:44 PM Cetin Hakimoglu wrote:

> The crisis is 'fixed' By printing 2 trillion dollars the banking
> system has been saved, and confidence is returning. The only direction
> for the foreseeable future for the stock market is up. If you're
> waiting for more shoes to drop you will be very disappointed. No
> more shoe dropping.

Wall Street Breakfast: Must-Know News

"Cuomo pension probe widens. New York Attorney General Andrew Cuomo is expanding his probe of pension-fund kickbacks, saying the probe has exposed "a national network of actors" whose schemes are ongoing, and has charged a money manager with making illegal payments to a political consultant in exchange for investment business. The charge is at least the fifth since Cuomo's investigation began."



I Hope Others Rally To Protect Andrew Cuomo - It is a "Dangerous Game" when chasing those with the means to "Pay" to stay in power. This is one of the better developments in that it is at least an attempt to Prosecute Wrong Doing. Complexity Favors The Sinister. The Complexity Of Corruption Is Vast. K-Street in DC may finally Be Exposed for its Nefarious Practices.



"Cramdowns get voted down." - Thank Goodness That Contract Law Dodged A Bullet. When Contracts Become "Negotiable In Retrospect At The Whim Of Judges" The "Free Market" Will Cease To Function With Any Vitality.


"Stress test results delayed." - This is buying more time to "Massage The Numbers". By the time these "Results" are released we may have reached, or passed, the values used for "Worst Case" in these tests. Lets hope that no one else "Commits Suicide" while arguing with regulators about what "Stats" to release. I guess that most of the "Original Captains" are in place still, so maybe there will be less dissension.



I Think It Is Great That We Are Not Going Over The Cliff - AS FAST.

Live While You Live.

Credit Card Issuers Coping with Record Delinquencies

The Credit Card Delinquency Records Will Be SMASHED In Coming Months - Unless, Of Course, Government "Strong Arms" This Segment As Well By Changing The Rules.

The Worst Is Yet To Come.

Popular New Year's Resolution: 'Stop Paying My Credit Card Bills'

Credit Card Default is the final indicator of consumer stress.

Everyone of moderate status uses their credit cards as the "Slush Fund" to cover unexpected expenses. After job loss this becomes the primary source of income and "Kiting" payments begins in the upward spiral of debt until the realization of "End Of The Rope" is reached. The so called "Robbing of Peter to pay Paul".

This metric will reach record status before this is all over.

TARP: Bailout or Money Pit?

TARP was a scam from the get go.

The Structure as written:
Congress "Gives" the money to treasury. The Treasury then writes the rules (with the help of the Fed Board). The Treasury and The Fed Board are the oversight (of the rules they wrote). Congress gets reports, but no say so or reprisal for policy revision.

There are too many other flaws to mention without a dissertation length comment.

Now Congress is upset about how things are progressing.

To The Fools In Congress - READ THE BILLS BEFORE YOU PASS THEM - IT IS YOUR JOB !!! STOP GIVING AWAY YOUR RESPONSIBILITY !!!

Bad Mortgages Are Only the Beginning

Hey Jason C,

Excellent Intelligent Discourse !!!

Not really into the drama of the movies.

Some things that you did not address that I think you may want to.

Adjustable rate mortgages have begun to reset at tidal wave proportions starting in March of 2008 and will continue to do so well into the first part of 2011. The implications are vast for this stat alone.

We still have an Opaque, Unregulated, Shadow Banking System, with more book value than all the wold's GDP combined, filled with Complex Financial Engineering that no one seems to be able to value. As an example of the possible destruction consider the Lehman's CDS auction just sold 400 million for 8 cents on the dollar. This is a Huge destruction of FUNNY MONEY. Carried onto the regulated books requires margin calls to maintain capital ratios. The Dominoes Continue To Fall. This is the underlying cause of the angst to lend. This is the "Tar Baby" that no one wants to address.

Until these two fundamental issues are dealt with there is no safe haven. What has been set in motion will not be short.

The response will be much of the same of what we have seen - Throw Money At It. If it all goes to replace the destruction - then balance is achieved and we are sold into slavery. If not then inflation and we are sold into slavery.

After the election the true nature of this catastrophe will be brought to light. When power is ceded there will no longer be a need to keep things hidden.

This is no movie; this is real life.

There are greater moves than just the Financials happening that few are aware of. Those in power are preparing for civil unrest and the world militaries are positioning themselves for instability.

One thing is for sure - The World Will Be A Different Place In The Coming Years.

To Assume Benevolence Is Foolish.