Rolling US Economy Into The Shitbin Thread

Here's more about that emergency meeting a couple of weeks back:

Mr. Paulson and Mr. Bernanke trooped up to Capitol Hill for a somber session with Congressional leaders. “That meeting was one of the most astounding experiences I’ve had in my 34 years in politics,” Senator Schumer recalled.

As the members of Congress and their aides listened, the two laid out their plan. They would begin offering federal insurance to money market funds immediately, in order to stop the run on money funds.

In addition, the S.E.C. would institute a ban on short-selling of financial stocks. Although Treasury officials concede that the move was mostly symbolic — investors can still buy put options that have the same effect as shorting stocks — they did it mainly “to scare the hell out of everybody,” as one official put it.

After Mr. Bernanke made his remark about the possibility that there might not be an economy on Monday without this plan, you could hear a pin drop.

“I gulped,” Mr. Schumer said.

Congressional leaders were nearly unanimous in saying that it needed to be done for the good of the country. Representative John A. Boehner of Ohio — the Republican House leader who a week later would lead the revolt against the plan — said it was time to put politics aside and move quickly, according to several participants. (An aide to Mr. Boehner denied that he voiced support for the plan, only that he made a plea for cooperation.)

Hearing that Mr. Bernanke and Mr. Paulson wanted legislation passed in a matter of days, the Senate majority leader, Harry Reid, expressed astonishment. “This is the United States Senate,” he said. “We can’t do it in that time frame.” His Republican counterpart, Senator Mitch McConnell, replied, “This time we can.”

Well, kinda.

lol polls:

#
78% of Americans want a bailout but most want significant changes ...
Nearly eight out of 10 Americans 78% say Congress should approve an historic bailout of the nation's financial markets, but most want lawmakers to ...
www.usatoday.com/money/economy/2008-09-25-poll-results_N.htm - 49k - Cached - Similar pages

L.A. Times/Bloomberg poll: Only 31% favor bailout | L.A. Land ...
Sep 23, 2008 ... The rapidly changing landscape of the Los Angeles real estate market.
latimesblogs.latimes.com/laland/2008/09/la-timesbloombe.html - 105k - Cached - Similar pages

LewRockwell.com Blog: Just 7% Favor Fed Bailout for Financial Firms
Just 7% Favor Fed Bailout for Financial Firms. Posted by James Ostrowski at September 22, 2008 07:57 AM. Just 7% Favor Fed Bailout for Financial Firms ...
www.lewrockwell.com/blog/lewrw/archives/022992.html - 6k - Cached - Similar pages

enjoying krugman's schadenfreude over this: http://powerlineblog.com/archives/011291.php

more on raising the FDIC limit

http://www.nytimes.com/2008/10/01/business/01ideas.html?scp=1&sq=small%20banks&st=cse

Wachovia bank has frozen the accounts of nearly 1,000 colleges, leaving institutions unable to access billions of dollars they depend on for salaries, campus construction, and debt payments.

i am, how you say, close to someone whose paycheck is dependent on one of these places. it's no joke. things are getting worked out, but there were some freak-out moments earlier in the week. like, imagine someone comes up to you and says, "um...all your money? yeah, someone just stuck it in a safe with a big lock on it, and only they know the combination. oh, did you need to buy groceries next week? well, we'll see if we can work something out."

(and in above scenario, imagine "all your money" is tens of millions of dollars, and "groceries" is hundreds of people's paychecks.)

Ed and Kondratieff are way off base here - are you guys paying any attention to what's going on in terms of interbank and municipal credit?

And what I am saying is cut the banks out of this, use the $700bn as a line of credit to enterprises, states, counties, municipalities. Unblock the economy not the banking system. The banking system can follow later when we have time to put in proper regulation possibly including flogging for the CEO's of over leveraged firms. We can let the turmoil continue in the banking sector and concentrate on priming the rest of the economy. Hell, a lot of that money will start trickling back into banks, hows that for some trickle down economics.

Barney Fruitcake Frank

wow, funny

I know you guys all read Big Picture anyway, but Ritholz has posted the best systematic rebuttal of the wingnut theories blaming the credit crisis on CRA or the GSE's that I've yet seen:

Making the rounds amongst a certain subset of wingnuts on CNBC, at IBD and other selfconfoozled folks has been the meme that the entire housing and credit crisis traces to the the Community Reinvestment Act (CRA) of 1977. An alternative zombie myth is the credit crisis is due to Fannie Mae and Freddie Mac. A 1999 article from the New York Times about the GSE's role in subprime mortgages has been circulating as if its the rosetta stone of the credit crisis.

These memes have become a rallying cry -- cognitive dissonance writ large -- of those folks who have been pushing for greater and greater deregulation, and are now attempting to disown the results of their handiwork.

I feel compelled to set the record straight about this pseudo-intellectual detritus...

http://bigpicture.typepad.com/comments/2008/10/misunderstandin.html

silent run on Wachovia

San Francisco-based Wells, a major West Coast retail bank, was the front runner but decided to pass because officials were worried about a piece of Wachovia's commercial loan portfolio, one of the sources said.

So not pretending that Wells Fargo is faultless or going to escape this, but when I read decisions like this I have a little more confidence in them in general.

http://www.kottke.org/plus/misc/images/here-be-dragons.jpg

Arrr

two fox news anchors are absolutely destroying some GOP senator they're interviewing about the bailout

tag team match two on one

Which senator?

Genuis lessons.

"A major insurance company -- one with a name that everyone knows that's on the verge of going bankrupt. That's what this is all about," Reid said prior to the Senate's approval of the $700 billion bailout bill.

And then, predictably, to avoid, I guess, accusations of being a retard:

"Senator Reid is not personally aware of any particular company being on the verge of bankruptcy. He has no special knowledge about [a bankruptcy] nor has he talked to any insurance company officials," said Jim Manley, spokesman for Sen. Reid, in an email to CNNMoney.com."

"fruitcake" reminds me of
http://tbn0.google.com/images?q=tbn:n1RDGehUbfxY5M:http://bp3.blogger.com/_1SBqFueoJQo/R4QIeuWDrDI/AAAAAAAAAMo/G3LeOsanCPA/s320/Stanley%2BRoper.jpg
Does anybody srsly say "fruitcake" anymore?

joe six-pack

Presumably there is something similar (to the Bradford & Bingley nationalization) there for HBOS should it become impossible for Lloyds TSB to proceed with its rescue. And equally they must be alert to some of the difficulties faced in other parts of the financial system which it would be unhelpful to name publicly.

http://www.thisislondon.co.uk/standard-business/article-23562887-details/Piece+by+piece+is+best+for+now/article.do

http://biz.yahoo.com/ap/081003/wells_fargo_wachovia.html

Huh. Well, okay then!

http://online.wsj.com/article/SB122303190029501925.html

Great. The bank in charge of my mortgage just bought the bank with my checking and savings accounts.

haha me too!!!

But Citigroup may challenge the deal on legal grounds, and is considering increasing its bid for Wachovia.

Weird.

not really

joe six-pack

jill wine-cooler?

lol looks like oreillys portfolios not doing too good

Why do people go on O'Reilly?

"You blame everybody else!"

HA!

i feel like there should be a catch phrase like "you are an overly loud barely human piece of shit" everyone who goes on his show responds with when he starts yelling at them

lol wow @ o'reilly/frank

lol looks like oreillys portfolios not doing too good

where have i heard that before?

when is someone gonna go on O'Reilly and just start aping him when he does his little bullshit dance?

someone who isn't a comedian, thx

can someone loan California $7 billion? k thx bye

Arnie's got some Terminator money still.

http://www.shof.net/drupal/files/pictures/execs/larryellison-hd.jpg

Bailout passes House 263 to 171.

Breaking News 1:27 PM ET: House Approves Bailout on Second Try

dudes dems and reps are going to come back from roshashana w/ten more votes each and pass a nearly identical bill

― \\\\\\\\YES//////// (ice crӕm), Tuesday, September 30, 2008 1:17 PM (3 days ago) Bookmark Suggest Ban Permalink

I'd love to know what the add-ons are.

Fuck that noise. The basic 'bailout' portion of the bill is unchanged. All that happened is it got loaded down with bribery. But bribes don't make it a better bill, just like putting $500 sunglasses on Dick Cheney doesn't make him a movie star.

Congress is going to get a jolt come November.

I'd love to know what the add-ons are.

Cocaine and strippers, from the look of things. Repubs hold US AND A over barrel for pork, details at 11:00.

maybe someone posted this already but you can see the whole bill here
http://banking.senate.gov/public/index.cfm?Fuseaction=Articles.Detail&Article_id=76b1aea4-39b8-404f-b3cd-f8b6c46e3b14&Month=10&Year=2008

its worth mentioning that the add ons arent what got the billed passed - the gop wanted to pass this thing the whole time - they were just trying to trick the dems into doing it themselves so as to run against it

otm

they had ads already bought on the day on the first vote attacking the dems for passing it, ffs