Corrente

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9AM horror (stuff you've got to do before the markets open)

Like rescue Citi.

Only $25 billion in cash, though.

Say, now that I own part of a bank, can I sell it and pay my plumber?

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BDBlue's picture
Submitted by BDBlue on

More or less. Read Yves:

Note key element of the deal is that the Federal government will guarantee $300 billion of Citi assets, a much bigger number than had been leaked earlier, with a rather convoluted loss-sharing arrangement, but the bottom line is that Citi is at risk for at most $40 billion. Citi also gets a $20 billion equity injection, on slightly more onerous terms than the initial TARP investments, but still more favorable than Warren Buffett's investment in Goldman. Oh, and it appears there will be NO management changes.

So we've guaranteed $260 billion in "assets", which aren't going to be worth anywhere near that amount and the guarantee means that Citi can repo those without worrying about losses (so it's basically the equivalent of a cash injection of that amount, see the analysis quoted in the ling) AND we've given them $20 billion.

As Yves says, it's impossible to justify the refusal to bailout GM at this point. It's just a matter of hitting GM management and the UAW. But those are terms that haven't applied to any of the financial sector even though we need to shrink the financial sector and don't need to shrink the industrial base.

But if you look at the terms of the bailouts, you'd think we needed to save the financial sector more than the car industry. Which whatever else I might say about the car industry, they build things that people need. The financial sector is nothing but a giant parasite at this point. But it's a non-union parasite and I suspect that's the important part.

Submitted by ohio on

A good bank, but just evil enough to get some of the TARP money?

Lambert has shit hitting the fan and needs a plumber, vastleft is going to need therapy for all the bugfuckery he's accused of, and we have to get FrenchDoc back and a nice fat bribe may do the trick.

Face it people: we need some dinero.

So where do we sign?

And I'll say that while the CEOs of these financial institutions may not be the nicest people in the world, i feel a little admiration for their chutzpah. They're earning every penny of those humongous bonuses---imagine asking for $28 billion and _getting it._

I ask for $28 billion everyday but no one has handed me big sacks of money. Not even Monopoly money. So my hat's off to the sheer audacity of demanding and getting all that cash.

Wouldn't it be cool if we had a politician with that same courage, thick skin, and brains to demand with the same urgency that we get universal healthcare, decent infrastructure, and great schools?

I would totally write him or her fan email.

Submitted by jawbone on

My reaction was that Bernhard over at Moon of AL.org was so right in saying the CDS's should have been declared null and void. Maybe not the CDS's which were based on tangible assets, but those which were the side bets--the incredibly complex derivatives of CDS's kind of thing.

If a fantastic thoroughbred is injured enough to stop its racing career but is well enough to live out its life, the owners still have a possibility of getting some compensation through stud fees. They own the horse, they paid for the training and stabling, jockeys,etc. They deserve to make what they can. They made a tangible investment.*

But bettors who made some weird bets at some point in the season on how many races the horse would win, or maybe would take two out of three of the Triple Crown--they deserve nothing. They were making gambles, pure and simple.

Not investments.

Now we seem to have the Feds (meaning taxpayers) covering some Big Banker Boyz' gambling habits. Bcz they're Too Big To Fail. Phooey.

Not right, not fair.

*Note: Prophylactic-- I realize some feel thoroughbred racing is not a good thing. This example is used only to highlight the absolute gamble the side betters on CDS's were engaged in. No opinion on horseracing.

Damon's picture
Submitted by Damon on

Hmmm, I know another company with hundreds-of-thousands of laborers looking for just that amount...

But, you know the old saying: Bankers are a boy's best friend. Wait, that's not old and that's not a saying.