Of Bailouts and Asset Monetization

You Are Astute!!! (0.00 / 0)

Paulson, I have heard, is "worth" about $500,000,000.00 himself.   I wonder if there isn't some conflict of interest here.

From his POV a bailout could keep his assets at a higher valuation long enough for him to cash out and buy into gold or other hard commodities after he leaves office in a few months (if his trustees haven't already done so).

Virtually all of the cumualative incentives incentives here are perverse.

The nation is being coerced into swallowing this poison pill....and when the shit hits the fan; I assure you the Republicans will pin all the blame on the majority of Democrats without whom this boondoggle could never have passed.

We are going to eventually have a deep recession, the longer we try to put it off...the deeper it will be....and the longer we put it off the more time it gives the richest of the rich to get out of these "instruments" on the taxpayer's dime....so that they can came in when the shit hits the fan and then buy up the world on the cheap.

The term "bailout" was/is 100% appropriate....it's funny to hear that the establishment is now lamenting the fact that they actually told a shred of truth by mistake.

This extended quote from the old NY Magazine article that Hopeful links to is very telling...

Colleagues were stunned by how completely he'd left his old life behind, down to his emerging liberal political beliefs. "Don't forget," says one Goldman partner, "this is a guy who was a free-market economist."

Soon after Lautenberg's announcement, an interesting friendship blossomed. Corzine reached out to the crafty, powerful then-Senator Robert Torricelli, the dark prince of New Jersey politics who was investigated for ethics violations and eventually forced out of public life. When the Senate ethics committee cited him for accepting pricey gifts (but not for more serious charges), he chose not to run for reelection.

The foundation for the friendship was laid when Corzine was still at Goldman and Torricelli was a rising New Jersey congressman in search of Wall Street campaign funds.

Contrary to the tale that has been told over and over about Torricelli and several others' cooking up the idea of a Corzine candidacy and then pursuing him, it was Corzine who pursued them. "I actually got a call saying Jon Corzine was annoyed with me for not suggesting him," says Torricelli, who was chairman of the Democratic Senate Campaign Committee in 2000. "And the truth is, until then, the thought never crossed my mind."

But Torricelli quickly became Corzine's Virgil, an indispensable guide to the world Corzine wanted to enter. He advised him on whom to hire, whom to meet with, and where to spend his money. Corzine threw himself into politics with the same indefatigable work ethic he'd had as a bond trader. "We told him he'd have to meet with 100 or 200 key people around the state," says Torricelli. "County chairs, labor leaders, party activists. And he'd have to attend every major dinner in New Jersey. Well, he saw 500 people. He did it for weeks."

Torricelli says he has, over the years, seen lots of businessmen who wanted to run for office. "But they almost never have the stomach for it," he says. "They're not prepared to invest the time and the effort. I was skeptical about Jon as well. He was a farm boy from Illinois who'd climbed to the top of Goldman Sachs. I did not imagine him going to the diners and beer halls and union headquarters and bonding with the folks who make up the heart and soul of the Democratic Party."

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by: Nick Lento @ Wed Oct 01, 2008 at 20:47:01 PM UTC

All these CEO politicians (0.00 / 0)

We speak derisively of our "CEO president" who's almost out the door, and we've got a CEO governor with a struggle on his hands to stay in 2009. Meanwhile, the CEO mayor next door (Michael Bloomberg) thinks only a CEO (or specifically him) is able to lead in tough economic times. I'm not sure I agree with his theory.

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by: Jeff Gardner @ Wed Oct 01, 2008 at 21:04:27 PM UTC

Senator Bernie Sanders Is Now Speaking.... (0.00 / 0)

...on the floor of the Senate on C-Span....

He proposes an amendment to the bailout bill that would raise taxes on individuals earnig over 500k and families earning over 1 mil by 10%.  (From 35 t0 45) that would raise 300Billion over the next 5 years and would have zero impact on 99.7% of all taxpayers!

This amount just might cover the whole bailout if they're telling us the truth that we'll get back a good part of the money when the toxic assets are eventually sold.

Of course, Sander's amendment has no chance of passage.

We need a hundred Bernie Sanders in the Senate; when that day comes America will have none of the problems we bow have....we'll have others, no doubt; but there will be no poor people and no uneducated people and far far far fewer sick people and lives will be longer and richer.

The cumulative effects of an economy and a culture motivated by alternating fear and greed can only be a general misery and angst.

The plan they're voting on now is even worse than the one on Monday; look forward to another S&L type collapse down the road now that the insured limits are up to 250K.

At best, this "bailout" gets us through the next six months before another economic "crisis" strikes "out of the blue".

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by: Nick Lento @ Thu Oct 02, 2008 at 01:01:06 AM UTC