THE ROYAL Bank of Scotland is to be one of the biggest beneficiaries of the planned $700 billion bail-out that comes courtesy of the American tax-payer if the US Congress gives the financial rescue package the go-ahead this weekend.
The bank's share of the bail-out will enable RBS to offload billions of dollars of questionable assets.
The bank's shares closed last Friday at 205p, a 71% fall from their pre-credit-crunch peak. However, analysts and investors predict that the shares will rebound sharply when markets open on Monday morning if the bail-out is approved over the weekend.
The Edinburgh-based bank will be able to write off a significant portion of its dodgy assets thanks to the bail-out, also known as into Tarp, the Troubled Asset Relief Programme as a result of the bank's significant presence in the US. Tarp was the brainchild of US treasury secretary Hank Paulson, who earlier this week got down on his knees and begged Nancy Pelosi, the Democratic House speaker, to rescue his plan to save Wall Street.
The Royal Bank, led by chief executive Sir Fred Goodwin, has had operations in the United States since 1988, when it bought the Rhode Island-based Citizens Bank. It has since bulked up its presence there with a string of acquisitions including those of Connecticut based Greenwich NatWest and Ohio-based Charter One. This entitles the Scottish bank to entrust billions of dollars of non-performing loans and sub-prime tainted assets to US taxpayers, according to Colin McLean, chief executive of Edinburgh-based SVM Asset Management.
He could not quantify the exact amount of dodgy assets that RBS can offload but said it could amount to "billions". In total, RBS has outstanding loans of $1.5 trillion.
#1
Banking is the most global of all financial sector businesses. A lot of the mortgage backed securities that are illiquid (now) are owned by foreign banks who believe the Fannie Mae/Freddie Mac fairy tale. Plus RBS put Jack Nicklaus on a 5# note - that's pretty damn red white and blue for me.
Posted by: Jack is Back! ||
09/29/2008 13:36 Comments ||
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#2
Is there a reason why the Bank of England can't bail them out?
Posted by: Steve White ||
09/29/2008 13:41 Comments ||
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#3
England needs to save all its money to pass out as welfare payments to its Fifth Columnists, Steve.
Posted by: Barbara Skolaut ||
09/29/2008 13:46 Comments ||
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#4
Not to mention the monthly payments when they finally outsource the Royal Navy.
The coup leader who seized power in Mauritania last month rejected Saturday an ultimatum set by the African Union to reinstate President Sidi Ould Sheikh Abdallahi by October 6. "The position of the African Union is neither constructive, nor positive. It does not serve the greater interests of the Mauritanian people," General Mohamed Ould Abdel Aziz told reporters in Nouakchott.
Earlier this week, the 53-member AU bloc gave Mauritania the October 6 deadline to "restore constitutional order" to the West African country.
A military junta removed Abdallahi, the country's first democratically-elected president, from power on August 6. The junta has since been under pressure from the A.U., the United Nations and the international community to reinstate him.
The deposed president has been under house arrest since the coup. His prime minister, Yahya Ould Ahmed Waghf, was re-arrested on August 22 and also placed under house arrest. A statement issued by the presidency of the state council September 1 said a 22-minister government had been formed with effect from the previous day.
A number of Western powers including the U.S. and France have refused to recognize the military government, denouncing it as "illegitimate."
This article starring:
Mohamed Ould Abdel Aziz
Posted by: Fred ||
09/29/2008 00:00 ||
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#2
Space stations have turned out to be nothing more than very expensive technical Antarctic research stations. There's been no demonstrated practical reason to sustain them beyond nationalistic chauvinism and academic curiosity. Until practical and useful returns can be found or developed, its a resource sink with missions that can be completed by either satellite or short duration orbital missions. Find that necessary function, then justify its existence.
#2
I'm not so quick to bust their chops. At least they are out there doing it. What has NASA done lately? How are those beans sprouts and fruit fly experiments paying off on the ISS?
Posted by: Yosemite Sam ||
09/29/2008 10:42 Comments ||
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#3
What do you mean? They are all Important Scientific steps to finding out the Origins of Our Universe. They say so for every mission.
They wouldn't be... inflating the importance of each girder to the ISS? Would they?
Posted by: Grenter, Protector of the Geats ||
09/29/2008 11:50 Comments ||
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#4
It is an impressive technical achievement. I was mocking the hyper-efficient ChiCom Official Party Spin Machine(tm). At least NASA only lies to itself (see the Challenger disaster and Feynman's "Nature cannot be fooled").
#5
How are those beans sprouts and fruit fly experiments paying off on the ISS?
Posted by: Yosemite Sam
YS: "Soylent Orange is fruit flies!!1!"
Posted by: Frank G ||
09/29/2008 21:46 Comments ||
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#6
ION CHINA > REDDIT - WHAT CHINA DESCRIBED [Pre-Olympics] AS A SEPARATIST ATTACK [Uighur Militants] MAY HAD BEEN SONETHING DIFFERENT [Paramilitary Police attack agz Same].
Also, TOPIX > SOUTH KOREA WANTS TO SET UP REFUGE CENTRES [Thailand, Mongolia, Russia] FOR NORTH KOREANS IN CASE OF POST-KIM COLLAPSE.
#7
ION TOPIX > RAND STUDY: CHINESE FIGHTERS CAN OUTGUN US F-22's OVER TAIWAN [72+ Chin:6 US F22 Numbers [12:1 Odds] + anti-US Area/Base Denial = Surviv US F22's cannot land after dogfight].
One in ten Australians believe some races are superior to others and Muslims are the most unpopular group in the country, the lead author of a new study said Sunday.
Professor Kevin Dunn from the University of Western Sydney said a 10-year study of 12,500 people found that Australians were generally tolerant, with more than 80 percent viewing cultural diversity as beneficial. But about 10 percent of the population was racial supremacists.
"Only about one in ten people across the various states would hold those views nowadays," Dunn told AFP. "It's better than in many other parts of the world, certainly in parts of western Europe where three in ten people would hold those views," he said. "But one in ten is a lot. It means one person in every lunch room, one person in every locker room, five or ten people on a train," Dunn added.
Dunn, a professor of human geography and urban studies, said Muslims were most often seen as the group that did not "fit in" to Australian life. "They stand out at the moment as the group that people would be most concerned about," Dunn said. "There's stronger levels of social distance or fear of Islam or concern about Islam than of any other group at the moment."
Dunn said indigenous Australians were the second strongest "out" group while there was evidence of an emerging antipathy towards black Africans after greater immigration from countries such as Sudan and Somalia.
Despite being the focus for international migration, New South Wales -- with a population of 6.5 million people and home to the country's largest city of Sydney -- was found to be the least tolerant state or territory. Dunn said while in some states as many as 90 percent of people saw cultural diversity as a good thing, this percentage was only in the mid-80s in New South Wales, possibly because Sydney accommodated higher numbers of migrants.
Asked how they would feel if a close relative was to marry a Muslim, 54 percent of people in New South Wales would be concerned, he said. And some 47 percent of people from the state indicated at least one group that didn't fit in Australia -- the highest percentage in the country. "It means that in New South Wales there is more of a narrow idea of what constitutes Australian," Dunn said.
The study's results come as migrants account for a record high proportion of Australia's population of 21 million people, with 430,000 migrants arriving Down Under in the 12 months to March.
Dunn's group, which is yet to fully analyze all the figures from the study, hopes to use the information to develop anti-racism guidelines. He said feeling about Muslims was strong across all of Australia, where Christianity is the most common faith, and that Muslims, who make up about 1.7 percent of the population, were the most unpopular group. "I don't think there's any doubt about that and that tells something about what needs to be done in terms of reconstructing images of some groups," Dunn said.
Anti-Muslim sentiment flared on Sydney's southern Cronulla Beach in December 2005 when mobs of whites attacked Lebanese Australians there in a bid to "reclaim the beach." The race riots, the country's worst of modern times, sparked a series of retaliatory attacks in which churches, shops and cars were attacked.
Posted by: Fred ||
09/29/2008 00:00 ||
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#1
Anti-Muslim sentiment flared on Sydney's southern Cronulla Beach in December 2005 when mobs of whites attacked Lebanese Australians there in a bid to "reclaim the beach."
Am I to assume that the "youths" who threatened the Australian girls with rape were the tolerant ones?
#4
When my nieces in Sydney started dating I made them both promise me they would never go out with Muslim boys. They just smiled and said, " Don't worry about it. We know."
#6
Asked how they would feel if a close relative was to marry a Muslim, 54 percent of people in New South Wales would be concerned
And that is how to do with race because? You can be color blind but ides determine behavior. Too many French girls found to their sorrow that the attractive Mulim man they had married treated them like sh.t, and once they got divorced, kidnapped their children and brought them to Algeria or Morocco because in his Muslim supremacist views, his children had to become Muslims even if at gunpoint.
And BTW, I don't see why you have to be ideas blind in matter of religion and not in matter of, say politics. Tell them one of those nice liberals if tehy would be so tolerant if their daughter were to marry a KKK man (that is one of is not a Democratic senator)? I for one, would be.
#7
The thing is some cultures are inferior to others and sometimes race can be closely tied with culture (especially in the super-PC era) so its easy to see how someone could mix the two concepts*.
It's even easier to see when the media only gives half the story and intelligent folks know they aren't getting it all but might not be able to accurate figure out what is missing from the picture.
* the example for this (beyond immigrants to the US who often succeed no matter what failures their home county was) is the Koreans. Same ethnic group in North and south but the North has developed a totalitarian Communist culture that has made them poorer than the lowliest dogs. It would be unfair to make up decisions on South Koreans based on there example.
#9
with more than 80 percent viewing cultural diversity as beneficial.
But about 10 percent of the population was racial supremacists.
One of those two groups need to be re-educated, to get back in touch with Reality and basic common sense, as experienced in any human population group, regardless of time and location up to a very recent time (and thus even only in the West), and which is even most probably engrained in our genes.
Russia is outraged that Poland and the Czech Republic request reciprocal inspections of defense installations.
Moscow is proposing a European summit to discuss a collective security system. It is also accusing Prague and Warsaw of 'lack of fundamental logic', as Czech Republic and Poland don't want Russian officers in the planned US missile defence bases in their territory.
According to Sergey Lavrov, the Russian Foreign Minister, speaking at the UN session Saturday, the 'existing architecture of security in Europe did not pass the strength test in recent events", that is, during the Georgian crisis. Mr Lavrov thus repeated the words of Russian president Dmitry Medvedev, who said the same following the Georgian war.
Mr Medvedev said then that in dialoguing with Moscow, its Western partners should take into account that Russia has its 'zone of privileged interests', including, his wording suggested, the former Soviet republics.
One of the key themes of the Moscow-proposed security summit would be the US missile defence installations in Europe.
Meanwhile, the Russian foreign Ministry sharply criticised Prague and Warsaw yesterday for their position on Russian officers' proposed presence in the missile and radar bases the US wants to site in Poland and the Czech Republic. The statement was issued in response to a recent Associated Press report from Prague, according to which Czech Foreign Minister Tomas Pojar and Polish Deputy Foreign Minister Przemysław Grudziński said their countries could agree to Russian inspections at the bases only on a reciprocal basis.
In a special communiqué, the Russian Foreign Ministry expresses surprise that the Poles and Czechs talk to Russia through the press. The statement states categorically that Russian experts' presence at the missile defence bases 'cannot be subject to any negotiations' and that 'no conditions' can be made on the issue. It adds that Moscow wants permanent presence rather than just temporary inspections, which US Secretary of Defence Robert Gates offered Moscow a year ago.
Then the idea, because of the West, started changing and, as the Russian Foreign Ministry's statement reads, 'evolved into degenerate forms'. The most recent development in this evolution are, according to Moscow, Poland and Czech Republic's demands for their officers to be allowed to inspect Russian missile launch sites or military bases in the Kaliningrad enclave. Such demands, the statement says, reflect a 'lack of fundamental logic' and show that Poland and Czech Republic 'do not need' any dialogue with Russia.
#2
TOPIX > RUSSIA: US-DOMINATED UNIPOLAR WORLD IS TOTALLY UNACCEPTABLE; + MEDVEDEV: RUSSIAN NAVY WILL GET NEW SUBS WITH CRUISE MISSLES.
As argued or inferred times before, iff the RUSS = RUSS NAVY, + VLADVEDEV, wish to offset US GMD, one way is to employ VARIOUSLY ARMED ARSENAL/FIRE SHIPS [Mother Ships] among other in select areas off the US Coasts, AS PART OF BATTLESPACE TASK GROUPS-FORCES. These vessels could be armed wid TLCMS, MRV Ballistic Missles, Armed UVS, even Armed DIRIGIBLES.
RUSS ANNEXATION OF ITS ARCTIC CLAIMS > Russ can build both LAND MISSLE BASES + OFFSHORE MISSLE/ARSENAL STATIONS [Oil platform = WW2 SEA FORTS]. GOOD FOR SCARING THE CANUCKS = MACKENZIE BROTHERS, + INDUCING ALLEGED FINANCIALLY TRUBLED WASHINGTON DC TO SPEND $$$ IT DOESN'T HAVE???
The global financial crisis took a toll on Europe Sunday, with top officials scrambling to save Fortis bank and Britain reportedly planning to nationalize mortgage lender Bradford & Bingley. As US lawmakers hailed a breakthrough in talks on a $700 billion bailout, high-ranking European officials raced to hammer out a plan aimed at keeping Fortis from becoming another victim of the crisis.
Posted by: Fred ||
09/29/2008 00:00 ||
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Oh, dear! What happened to all that euro-gloating?
The Far Right has made a grand return in Austria, emerging from yesterday's elections as the second biggest parliamentary block, according to preliminary results.
Posted by: Fred ||
09/29/2008 00:00 ||
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#1
Jörg Haider, won 11 per cent of the vote with his new party, the Alliance for the Future of Austria.
Two funny (in a way) tidbits about mr. haider :
- he's a very close friend of saif islam, one of the sons of good old ka-daffy, who even offered him his pet panther I think, and who said a while back in a mag interview (couple years ago?) that jörg... had converted to islam, and that he, saif, had been his witness.
- haider is a big proponent of the entry of turkey into the UE IIRC.
#2
It would be amusing if it comes out that Obama is seriously "dirty". And ironic if it comes after the election, leaving us with President Joe Biden.
#6
It depends on what Fitzgerald wants. We know he's going after Gov. Blago.. We know he wants Daley but Daley has been in power so long that he knows enough to let only his top aides leave their fingerprints.
With Barack, we have the real estate deal, the hospital board vote fix, and money legislated for Rezko's slumlord housing developments.
The question is what will Rezko offer up. Obama's current status makes him a big fish. We need some leaks.
As though the media would circulate them. We'd get coverage of the smear campaign without identifying the specific allegations. Were did we see that before? [rhetorical question]
Now we know why he picked Biden. Who'd want a President Biden? That sort of likable accountant uncle who just drones on and on, but who'd you never really trust with the family finances. So they'll just treat it like they did Bill's perjury before a Federal Grand Jury. tsk-tsk.
Andy McCarthy is in top form today. He's zigging when everyone else is zagging.
Orwell must be having a good laugh today. Nancy Pelosi yesterday released a summary of the bailout. Under the heading of "Protection for Taxpayers ..." Madame Speaker includes this whopper (my italics): The scheme "[a]llows the government to purchase troubled assets from pension plans, local governments, and small banks that serve low- and middle-income families."
So in addition to rewarding irresponsible lenders and borrowers, we taxpayers are now to be "protected" by buying the toxic debt of states, cities and municipalities. It's one thing to throw a life-line to the credit industry; local governments, by contrast, have the ability to cut spending drastically or raise taxes if their inhabitants want government services. Elected politicians are then accountable for runaway spending and mismanagement. If Detroit or Chicago is sinking because of big-government policies, that's what the citizens of those cities asked for by voting for Democrats year in and year out. Why should the rest of us be on the hook for that?
Basically, the agreement struck over the weekend with key participation from many of the guiltiest politicos provides no mechanism for valuing the debt that Americans are being asked to assume; places few meaningful limits on the public/private recklessness we will be forced to underwrite; would go into effect right before an election which, if Obama wins, would turn management of the bailout over to a new, big-government administration; and protects not the taxpayers but the defaulters to whom Democrats compelled the banks to extend credit beginning in the nineties (lighting the fuse for today's big bang), while responsible borrowers are denied what would otherwise be available credit and a more honest housing market.
#1
If Detroit or Chicago is sinking because of big-government policies, that's what the citizens of those cities asked for by voting for Democrats year in and year out. Why should the rest of us be on the hook for that?
Add Atlanta, Philly, Houston, Dallas. Rural banks in fly-over are generally strong due to the fact they did NOT invest in the Federally sanctioned give-away programs.
#4
The public is not amused that the pockets of the many are being picked for the few -- especially since the few include mostly the rich and the uncreditworthy. And by "uncreditworthy" I mean both the stupid (Golden West, Wachovia, etc.) and the poor who can't make their payments. It doesn't help that the bail out designers are some of the same idiot politicians who precipitated this and/or failed to address it three years ago. Perhaps the bail out is going to have to be smaller, a bit more phased, and a bit more supervised.
#7
This socialistic bailout bill failed. It could not fail without the votes many Democrats going against their party and "real" conservative Republicans. It is also a rebuke of a bill that would create a Treasury Czar--which is very anti-democracy.
The Congressmen and women must have heard the sound of their constituents throwing them out. Now if the real culprits such as Dodd and Frank, etc. could be prosecuted for malfeasance and impersonating a Congressman we would do well.
The bill failed in the House 228-205. Yes, the stock market was falling already. Per AP: Ample no votes came from both the Democratic and Republican sides of the aisle. It will be interesting when names can be attached to those numbers. Tomorrow is the Jewish New Year, so if they don't put something to a vote before about 5pm today, there won't be another vote until tomorrow at 10 pm or so, more probably Wednesday.
#11
How could Pelosi bring it to a vote without knowing it would fail? Why not wait a day or two and let the Dow drift down to scare people and give more time to craft a bill enough could support? What a dolt!
#12
Now if there is a depression -- or even merely another couple of bank failures -- the honourable Representative Pelosi can blame the Republicans, no matter how untrue.
#13
I don't think so. There were enough donk votes to put it through if she wanted to crack the whip.
She needs to worry about holding her majority. Remember, every rep is up for re-election in 5 weeks and 205 of them voted to do something the majority of the people thinks is very stupid. They have to defend that vote starting now.
Even if the market had collapsed in the manner of 1987 - 20+% in one day, followed by another 10% the next - we need to remember that it ultimately recovered. Without us having to ban short-selling. Or mount a $700b handout plan. Paulson and Bernanke thought they could pull the wool over our eyes. As it turns out, we - liberals and conservatives alike - understood fully the nature of this handout, and made this known to our representatives in Congress, who quailed in fear.
#15
NS, I think we've pretty well established that Pelosi is a fundamentally incompetent parliamentary manager. I thought that was why they brought in her arch-enemy, Hoyer, as her second - to provide someone who could organize a caucus.
Apparently I gave the pair of them too much credit. Wow, what a mess. Don't bet on the market not dying just yet.
Posted by: Mitch H. ||
09/29/2008 14:47 Comments ||
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#16
This is unfortunate. We could have used some aggressive deficit spending.
Posted by: Mike N. ||
09/29/2008 14:49 Comments ||
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#17
Are there names attached yet? Anyone got an official link site to the house that can go through right now? I keep getting redirected to a stupid ask.com spider. I beginning to loathe ask.com.
#20
Tell us your killing CRA (Community Reinvestment Act) and we will support your stupid bill.
OregonGuy, I agree 100%, but why stop there?
Throw in GSE's and mark-market rules and you have the foundation for a much more efficient capital market.
Boehner speaking (saw on MSNBC). Pelosi apparently gave such a vile, hate-spewing attack of Bush and the Republicans on the House floor, blaming the current financial problems on "Eight years of this administration and its allies in Congress" that, according to one report, the heads of some Repubs who heard it 'exploded' and they 'went berserk.' The attack was so ugly that several dozen Dems bolted, too. That smarmy, bug-eyed old Stalinist ("Riches for me; misery for you") just couldn't keep her bile bottled-up long enough for the vote. All bets are off now.
The whole point of mark to market rules is to make the company's solvency transparent on a regular basis. Which is then used as an excuse for levering up (i.e. borrowing more money). Banks that don't hold mortgages as securities don't mark to market. But then again, they also don't lever up 30 to 1.
#30
Not Keynesian. I think the government should always deficit spend.
Posted by: Mike N. ||
09/29/2008 15:32 Comments ||
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#31
Pelosi is spinning this on blaming the R's.
(95) Dems voted against it -
(12) Reps were going to vote Yea, but her
five minute speech before the vote must have ticked them off and they voted Nae.
Only 60% Dems voted for the bill.
Posted by: Tom- Pa ||
09/29/2008 15:43 Comments ||
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#32
Pelosi's speech was 16 minutes -- I just watched it over at MSNBC (sorry, the only place I found it)
They woman was over the brink... Hands waving, hands punching -- hateful speech... she wasn't selling the bail-out package -- she kept repeating the 700 ---- HUNDRED-----BILLION.... and of course, who wants to say, I voted for 700 Billion.
Oh, and thanked Barney Franks for his leadership, knowledge, prudence and judgement!
#33
Problem -- now folks are saying she will bring back the bill, with all the hands-out ACRON, etc... and ram it through, on a majority rule by Dems ---
From Kudlow: As this scenario goes, the House Democrats need 218 votes, and they have to pick up a number of black and Hispanic House members who jumped ship because the Wall Street provisions, in their view, were too benign. So things like the bankruptcy judges setting mortgage terms and rates, the ACORN slush-fund spending, the union proxy for corporate boards, stricter limits on executive compensation, and much larger equity ownership of selling banks through warrants will all find itself back in the new bill. Of course, this scenario will lose more Republican votes. But insiders tell me President Bush will take Secretary Paulsons advice and sign that kind of legislation.
#34
Right, which means 40% of the Dems voted against the bill! How is it possible that Pelosi did not know that she didn't have 40% of her own party onboard here?
It's simply not possible - Pelosi planned this one so she could blame the whole thing on the Republicans. Her level of hate is so extreme she's willing to dump the whole country into depression, socialize the economy, nationalize the banking system, and take the first steps towards Obamessiah's and the Speaker's socialist dictatorship.
#35
I seems that the SEC mark-to-mark accounting has resulted in companies being overvalued and consequently enabled these firms to borrow more money, i.e. leveraged their funds up.
It also seems like this rule is also undervaluing some companies and driving them into bankruptcy and a firesale. They can't attract investors because they are shaky about in investing in something on the way down and out. They either get sucked up by some other firm for nothing like what they are really worth or go out of business. Should make for some good investments if they don't go out of business. This rule doesn't seem to do anything right. If an investor buys today, you don't know what the heck you are getting for your money.
#36
Sherry, That assumes Pelosi can turn the 95 donks who voted against the measure to vote for a new pork laden version. I suspect these 95 voted against it because they know how much their constituents are against it and they don't want to have to justify a vote for it for the next five weeks of campaigning. These are conservative districts the donks took in 2006 by acting middle of the road to conservative. Getting them to change their votes isn't going to get any easier, especially if the way it is done is pork. I'm not sure San Fran Nan gets another vote, espcially as the market did not tank. Down 700 isn't great, but it's not tanking.
#37
Her level of hate is so extreme she's willing to dump the whole country into depression
I think we need to get a grip here. The failure of this handout bill isn't going to dump the country into depression. Bush is letting Paulson and Bernanke talk him into a hysterical frenzy. This is a new and different kind of financial panic that is similar to every other previous financial panic in one way - when those other panics occurred, they were new and different, too*.
* If they weren't new and different, the ingredients for those panics wouldn't have materialized. If there's one things humans do well, it's learn from history. This is why we're no longer subsisting on raw berries and roots and dressed mainly in animal skins like our ancestors. So why do we have financial panics? The difficulty with learning from financial history is that every panic is qualitatively different from the last. But they do have one other thing in common - none of them required $700b in taxpayer-funded handouts, and none of them led to the collapse of the republic.
#38
Her level of hate is so extreme she's willing to dump the whole country into depression
Just to be clear on the historical context, we have had financial panics every few decades since the founding of the republic. Like other financial panics, this panic is merely another instance of the unwinding of an asset bubble.
Good observation. But there are still a bunch of blue dog donks and dems with tight races that will not be swayed by the left-wing add ons. What also got the gall was the Senate playing scaredy cat and waiting until Wednesday to see how the chips fell in the House. Chicken shits all of them.
Posted by: Jack is Back! ||
09/29/2008 16:17 Comments ||
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#40
Bush is letting Paulson and Bernanke talk him into a hysterical frenzy.
"W" needs to FIRE these two clowns today. Oil is GOING DOWN! Which means economic CORRECTION! It means the wealth transfer to foreigners is slowing! Let the market and the economy fix itself. Keep the government OUT OF IT!
#41
Those of you crowing that the bailout failed . . . what likely happens next is that Pelosi and company come back with a more left-wing version--the slush fund for ACORN, bankruptcy judges givenb the power to rewrite mortgage contracts, more government intrusion in the financial system--and it passes on a party line vote. You think the bill that failed was socialism? Wait'll you see this one!
If it gets through, the MSM then eagerly picks up on the meme that Bush got us into this mess and only the Dems are getting us out. Obama wins the election, has two Dem houses of congress to work with . . . well, do I need to keep going?
Posted by: Mike ||
09/29/2008 16:25 Comments ||
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#42
The market tanked (only)777 because the other World markets are closed(??). GWB wanted this passed today because tomorrow is the end of the quarter/month and tied to the Hedgefunds. I think the numbers might be worse tomorrow??
Posted by: Tom- Pa ||
09/29/2008 16:25 Comments ||
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#43
hello!
zhang fei taught that whore a lesson by cutting off his dick.
That doesn't make any sense
So the theory is that she turns around, re-injects the ACORN and other pork into it and all the Dems pass it without the Republican votes???
Were back where we were last week, when it wouldnt get passed because the Dems didnt want to take ownership of the bill.
So, the Dems will take ownership of a pork-laden bill that may or may not help "Save America"?
#45
Respectfully disagree Mike. When Paloosi and Franks get wrangled and nervous, we should all celebrate. Watch the price of crude oil. The stock market did not die today, it may well be stabilizing. Look at the bank ratings, Bank Implodeo-Meter, Bank Rate, etc. Bad banks (big city loaners) are tanking, as they should. Rural fly-over banks remain STRONG! The American people have spoken. They don't want any part of a bail out.
#46
McCain or Bush or any other prominent Republican could have tied this bail out around the Democrat's necks like an anchor and thrown them overboard. Plenty of prominent Democrats played a major part in precipitating this mess and in not cleaning it up three years ago. Instead the Republicans were mum. Pelosi and Franks and Obama et al could have kept their mouths shut and gotten a pass, but they didn't. Big mistake. The longer this goes on, the more people are going to find out who started this mess. And that is good.
#48
I seems that the SEC mark-to-mark accounting has resulted in companies being overvalued and consequently enabled these firms to borrow more money, i.e. leveraged their funds up.
It also seems like this rule is also undervaluing some companies and driving them into bankruptcy and a firesale. They can't attract investors because they are shaky about in investing in something on the way down and out. They either get sucked up by some other firm for nothing like what they are really worth or go out of business. Should make for some good investments if they don't go out of business. This rule doesn't seem to do anything right. If an investor buys today, you don't know what the heck you are getting for your money.
Actually this rule is fine. The whole point of the mark-to-market rule is to allow companies to lever up, via making bondholders (who lend them money) comfortable with the value of the assets on the companies' books.
What has happened is that the assets on those books - in many cases, mortgage-backed securities and other bonds or bond-like instruments guaranteed by bond insurance companies like Ambac, AIG, et al - have started having problems with coupon and principal repayments. These companies have started marking to fantasy in order to avoid financial collapse. Short sellers have driven the stocks of these companies down after pointing out that the so-called AAA-rated (i.e. highly-rated) assets on their books are really junk assets that may only be worth ten cents per dollar of face value. Bondholders (i.e. the creditors) in these financial institutions are taking note of the fact that short-sellers don't think everything is on the up-and-up. They are taking a closer look at the marked-to-fantasy portfolios and don't like what they see. Bond ratings companies like Moody's, Fitch and Standard and Poor's are starting to fess up that they had no idea what they were doing in providing AAA ratings to the assets on these financial institutions' books. The ratings companies are starting to change their ratings on those assets from AAA to junk in one leap. This is spooking the bondholders of those financial companies, and anyone who might be in line to buy those bonds. The upshot? These financial companies are having serious problems borrowing money for anything less than interest rates in the teens, which would put them out of business. And they're not able to raise significant sums of money via stock sales, because the market correctly values shares in those companies as worth nothing.
The moral of this isn't that mark-to-market is bad. In fact, without mark-to-market, bondholders at these financial institutions would probably get nothing back in a liquidation, as financial institutions continued losing money while reporting that they were making money. (The current situation is that they are getting something less than $1 back for every dollar of face value, but that's still better than nothing).
It's that financial institutions should know what they're buying before they buy them, and not merely rely on the crutch of the ratings agencies. Because of their huge leverage compared to non-finance companies, financial institutions need especially strong internal controls to make sure that the revenue generators are actually generating profitable revenues, rather than accounting entries that will have to be reversed in the future because of actual economic losses.
There's a whole laundry list of items (that I'm too tired to think up and enumerate) that companies need to do in order to avoid getting themselves into these fixes. The major problems with Paulson's handout program is that (a) it primes the surviving financial institutions to think that Joe Taxpayer will always come to the rescue and (b) it transfers cash from innocent taxpayers to the financial institutions that incautiously made these losing bets. Companies need to be careful with their investors' money. A financial panic is the market's way of teaching financial companies prudence. There is nothing fundamentally wrong with the market. The fact is that markets go up AND down.
#49
The Congress has a lower approval rating than George Bush - by 11 points in the latest polling. It ain't getting higher because of this mess.
There's more than four weeks left in the election season, and yes, there's early voting, too.
If the Dems want to play political games by allowing this vote to be defeated so that they can lard up the "rescue" bill with ultra-lib pork, then they'll have run on their record. I such a bill is presented in the House, not a single Republican should vote for it. Let the Dems win on a party-line vote. Nancy and Steny WILL have to whip and win that one at any cost.
Take a deep breath. The sky is not falling, gas prices are.
#51
The longer this goes on, the more people are going to find out who started this mess. And that is good.
Amen and AMEN! And, the longer it goes on...tomorrow and the next, the more the American people are going to see market CORRECTION... without government (taxpayer) intevention! This thing is bigger than the United States, it is global. The OIL component is the key.
"APPRECIATE*AMERICA! The enemy from within is TWICE as dangerous as the one from without. REPORT ALL Un-American activities to your superior officer or director of the Federal Bureau of Investigation. DO YOUR SHARE"
The bailout failed because of pure political cowardice. I used the Rothenberg Political Report to find the House incumbents who are in tough races (i.e. ones they could lose). There were 44 House members listed 20 Democrats and 24 Republicans. Of those 44, only eight voted for the bill.
#53
It drives me nuts that Dems like Frank and Dodd are not being run out of town on a rail covered in tar and feathers. I was listening to the 2004 hearings with the head of the group responsible for oversight of fannie/ freddie. It was all dem cover. Maxine Water (spit) was lauding Frank Raines, and saying everything was on track with new desktop loans and 100% loans. They should all go to jail.
Rich Lowry had dictated the party line at the National Review on this handout. The fact is that no porked up handout bill could pass over Bush's veto. As he did with the amnesty bill, though, Bush will support this misbegotten handout bill over conservative resistance. But that's good - Democrats in conservative districts are going to have serious problems. A smaller Democratic majority in Congress combined with an Obama presidency might actually be superior to having a bigger Democratic majority and McCain as president.
#59
you know, it seems to me that there's a hole in our constitutional balance of powers that needs addressing...oversight of Congress. The evil deeds of the executive branch are grist for congressional hearings but what venue keeps the legislative branch in line? Federal/Supreme courts rule on the constiutionality of laws but not Congress's actual behavior. Perhaps a standing independent counsel (consul?, tribune?) appointed by the Supreme Court with powers to investigate Congressional activity with Supreme court approved recommendations going to Justice Dept for any criminal charges that need to be laid.
Start with the history and genesis of the meltdown. Include as appetizers the the quid pro quos that Stevens, Young and Murtha have been getting for ear marks. Willy "the Fridge" Jefferson, next. OK, so maybe we'll need a few extra tribunes to start.........
#62
I'm against the bailout. Yes, lots of people are going to be hurt by not doing it. That has to be counterbalanced against the tremendous number who will be hurt by the debasing of the U.S. currency. It sucks that we're here, but we are. Now we have to deal with the way things are, not how we wish they were. No bailout, pay the piper for the excesses, and keep the currency sound.
#64
How will this play out? The dems, and in particular Pelosi, will be seen as the cause. John McCain will, in a day or so, come up with an alternative bill that will pass.
He will be seen as the candidate that solved this mess, and will win the election as a result.
And historians will scratch their heads in the future, wondering if George Bush had planned it all, to ensure a Republican returned to the White House.
And the left will say "Nah. Bush is stupid.... isn't he?"
#66
If you print additional money to replace money that's been destroyed, is it really more money?
Posted by: Minister of funny walks ||
09/29/2008 18:32 Comments ||
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#67
A smaller Democratic majority in Congress combined with an Obama presidency might actually be superior to having a bigger Democratic majority and McCain as president.
That is, until Iranian nukes start wiping out american cities.
#68
That is, until Iranian nukes start wiping out american cities.
The bozos on the other side talk a good game. But the fact is that the Ayatollah Khomeini ended a war with Iraq that Iran did not start because he was afraid of mere defeat, never mind nuclear incineration (which is what we would deliver upon them if they actually tried to nuke American cities). These people are using a facade of religious faith to amass power by fooling the credulous into supporting them. Uncle Sam went into Iraq on the mere suspicion that they were connected with 9/11 in some way. They *know* that we will kill them dead if they mess around with nukes on American soil.
Note that they have had decades to conduct terrorist attacks against Americans on US soil. Timothy McVeigh showed it just isn't such a big deal to organize a terrorist attack that kills hundreds of people. But since we shot down their passenger airliner in the Persian Gulf in the 80's, Iranian proxies have conducted a single attack - on Dhahran in Saudi Arabia against an American military target. Iran's leaders have geopolitical ambitions, rather than religious ones - watch what they do, not what they say.
#69
Should this economic "crisis" push the price of oil downward significantly, then perhaps we will see the Iranians pulls some shenanigans that give the impression they are less than stable. Think of a tanker hitting a mine or some Iranian speedboats making more threatening moves at a US Navy vessel.
#71
Doesn't low oil prices hurt the Russian economy, too?? If ME goes unstable, disrupt production/ world deliveries raise them again?? Didn't Chavez just visit Russia??
Posted by: Tom- Pa ||
09/29/2008 19:38 Comments ||
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#72
at loudobbs.com
Do you believe today's Congressional vote against the Wall Street bailout is a victory for the American people and a rejection of the attempted extortion by corporate and political elites?
Yes 75% 5177
No 25% 1689
#73
These guys can milk self-generated crises all they want. The fact is that when the oil price hit the unsustainable level of $38 in 1981, the world economy came to a shuddering halt. That price level in today's dollars is about $65. Even without the financial crisis we face, oil was set for a crash. When you factor in the financial crisis, I think the Iranians are due for some lean years ahead, exacerbated by the artificial crises they generated to push up oil prices.
#74
Zhang Fei, Don't get me wrong. I think the bailout bill is a terrible idea. My surprise and disgust is that Pelosi and company didn't know that 40% of their membership wasn't going to vote with them so it's all the Republicans fault.
They're going to come back with something that will be far, far worse IMO.
I just can't believe they didn't take a poll of their own membership and knew what was going to happen beforehand so they could blame it all on the Republicans.
#76
FOTSGreg---Pelosi and Co did not do their homework. They suffered from hubris, big time. She, in her isolated position, assumed that the Dem rank and file would line up like good little ants. What she did not count on was the absolute outrage of the district constituents, emailing and ringing the phones off the hook of their representatives. She has lost a lot of value in her holdings, esp with AIG, and that contributed to the wigging out at the end for 16 minutes. As the Russians say, tough schitskis.
Posted by: Alaska Paul ||
09/29/2008 20:17 Comments ||
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#77
Like her pension won't be enough to live on...
#79
Alaska Paul, Pelosi and Co did not do their homework
Or maybe they did. They may well come back with the old larded-up version next time. Today's vote may have merely been a political maneuver. The liberal bill would not have passed today - but Thursday it probably would, and Bush would have to sign it.
#80
The whole point of mark to market rules is to make the company's solvency
Agree Zhang Fei... up to a point, but it can clog up the system , due to different business cycles.
I see Newt has come out with a plan for ridding the market of this accounting rule.
This video on youtube pretty much sums up the Democrats part in the mess - including Barney Frank, Chris Dodd (receiver of the most contributions from Freddie and Frannie Mac), and Barak Obama (who sued citybank to _FORCE_ them to make subprime mortgages). As well as Bush'es and McCain's attempts to regulate it (blocked by Barney Frank and Chris Dodd).
Fred, have Ethel ready with your pills before you watch it. Spread it far and wide.
Citigroup has agreed to buy Wachovia bank in a deal backstopped by taxpayers and brokered by the Federal Deposit Insurance Corporation to avoid another major corporate failure in the midst of the ongoing financial crisis.
Citigroup will pay the Charlotte-based Wachovia about $2.16 billion, or $1 per share, for its banking operations. Wachovia will retain its wealth management and brokerage operations.
(Xinhua) -- U.S. Senate on Saturday approved to lift a quarter-century ban on offshore oil and gas drilling. President George W. Bush is expected to sign the measure.
Senators approved a 630 billion dollars spending bill by the 78-12 vote. House of Representatives on Wednesday approved the same bill which dropped the offshore drilling bans.
In the past 27 years, Congress has passed drilling bans on the Atlantic and Pacific coasts each year because of environmental concerns and pressure from some coastal states worried that drilling might hurt the tourism industry.
However, President George W. Bush has repeatedly urged Congress to lift legislative restrictions on offshore oil drilling to help address rising fuel costs.
Bush lifted an executive ban on offshore oil drilling in July. There are two prohibitions on offshore drilling, one imposed by Congress and another by executive order signed by former President George H. W. Bush in 1990.
Posted by: Fred ||
09/29/2008 00:00 ||
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#1
Are there other obstacles?
Posted by: Richard of Oregon ||
09/29/2008 7:18 Comments ||
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I don't think it applies in this case - unless this measure explicitly opens off-shore drilling then state law would be in force in the absence of Federal law.
OTOH I can imagine states having their eyes on the tax revenue possibilities.
#7
There's a 12-mile territorial limit and then there's a 200-mile maritime limit (which I understand is mainly for security and inspection interests). After that it's international waters.
The limits get sticky in places like Cuba and Key West, for example, and the US's failure to enforce its own maritime limits is one of the reasons why China is drilling in what could, technically, be called US waters under Cuban auspices.
I don't think the states have any authority outside of 12-miles, however, but the limit has previously extended out to the maritime areas due to Congressional and Presidential edict. The lifting of the ban probably means it's open season on drilling 12 miles or more away from a coastline.
#8
While the oil industry has done a lot to clean up their operations over the last thirty years all it will take is one significant spill that washes ashore to get the ban put back in place. Lets hope nobody gets sloppy.
#9
Cheader: Santa Barbara, among other sites, have natural oil seeps, sending oil globs to the beaches now....
Posted by: Frank G ||
09/29/2008 21:52 Comments ||
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#10
In Santa Barbara, the Chumash natives used to caulk they boats with the oily stuff they found. They talked about it in a display at the Santa Barbara Museum of Natural History.
Posted by: Alaska Paul ||
09/29/2008 22:00 Comments ||
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The United States congressional leaders on Sunday said they had reached the broad outline of a deal to put in place a $700 billion financial system bailout but were awaiting details on paper before declaring it final. "We've made great progress," House of Representatives Speaker Nancy Pelosi told reporters after a night of marathon talks. "We have to get it committed to paper so we can formally agree."
Leading lawmakers had huddled with U.S. Treasury Secretary Henry Paulson through the night on Saturday to nail down an agreement to create a massive government fund to buy up distressed debt from financial institutions staggered by failed mortgages.
Fear-wracked financial markets had lent the talks urgency and lawmakers were striving to reach a deal by Sunday before Asian markets open. It was unclear when the House and Senate might vote on the legislation or whether any last-minute hitches might arise. Lawmakers, however, have been hoping to vote within days. "We think we should have an announcement sometime (Sunday) but you know we're committing it to paper tonight and our people will work all night long," Senate Democratic leader Harry Reid said.
Posted by: Fred ||
09/29/2008 00:00 ||
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#1
Whatever your position on the 'bailout', the events these past two week pretty much kills any practical approach to 'privatization' of even a part of Social Security. In the end the government has failed to demonstrate the restraint in bailing out bad decisions. Allowing people to take part of SS and placing it into the market only will result in the government being panicked into insuring results with even more intervention into the market. So the demographic time bomb will remain ticking for another decade or so awaiting its own crisis that will dwarf this one.
#3
It may be a done deal unless some of the donks get fiscally conservative and move away from taking this country into socialism all of a sudden.
There don't seem to be other plans entertained or if they were, they were dismissed for political power and potential votes. However,I do hear a large number of people, both donks and trunks calling into CSPAN and mad as hell.
I saw an interesting letter and plan posted at Rep. Virginia Foxx website that was put forth by the CEO of BB & T, John Allison. I don't think we have had an adequate transparency on the bailout or debate. There ought to be criminal investigations and going on at the same time.
#7
It's interesting that Speaker of the House Pelosi and Treasury Secretary Paulson keep trying to stampede those who reject the plan. They've repeatedly announced a done deal when it was still in the the early stages of discussion... the first time before the House Republicans had even been briefed on the situation, let alone the details of the proposed bill.
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
(Xinhua) -- U.S. Senate on Saturday approved to lift a quarter-century ban on offshore oil and gas drilling. President George W. Bush is expected to sign the measure. 
The United States congressional leaders on Sunday said they had reached the broad outline of a deal to put in place a $700 billion financial system bailout but were awaiting details on paper before declaring it final. "We've made great progress," House of Representatives Speaker Nancy Pelosi told reporters after a night of marathon talks. "We have to get it committed to paper so we can formally agree." 
