The Bailout Bill Caused the Crash
Sounding very Naybob like and validating our Natterings for the last five years...
From Jon Markmans latest... It's A Great Time To Be Afraid
"If you really read the bill, and understand how it will be interpreted, it's the scariest thing you ever saw,"
said the trader, who asked me not to use his real name.
"These guys have no idea what they're unleashing."
check out Section 113 of the bailout bill, titled "Minimization of long-term costs and maximization of benefits for taxpayers."
This is the section that Congress haggled into the bill to ensure a payoff, via warrants, for citizens if mortgages purchased from banks are later sold for a profit.
Yet the "trader" says bank lobbyists snookered the government by sneaking in an exception under subsection 3a,
"Conditions on purchase authority for warrants and debt instruments."
The clause, titled "Exceptions -- De Minimis," states that any debt instruments worth less than $100 million won't trigger the payback provision.
banks will simply issue their debt in tranches of $99 million or less, and avoid allowing the government
-- and thus taxpayers -- to get a piece of the banks' profits. "It's a joke," he scoffed.
Other traders who scanned the bill came to the same conclusion, through their own prisms,
agreeing that the bill would provide only an illusion of action while failing to address the key problems facing the financial system:
Too many houses will remain on the market; they were bought with too much leverage that is vaporizing in spurts;
and those losses have left banks with too little capital from which they can lend.
Even worse, the traders pointed out, the government can make money on the loans only if it pays so little for them that they can be sold at a much higher price.
And yet if the government doesn't pay enough, then the banks won't receive enough to make a difference in their balance sheets.
So here's how the taxpayers will be cheated, they said:
Banks will take advantage of the suspension of mark-to-market accounting by stating that loans originally held at "par," or the equivalent of the purchase price,
and now valued by the market at 20 cents on the dollar, will really be worth 85 cents if held until the loan matures.
The banks will then sell the loans to the government at a fake discount of 75 cents on the dollar.
"The lobbyists made sure this bill was rammed through so that these rip-offs couldn't be fixed in committee," said another trader.
"Everyone on the Street knows it solves nothing." This is why there's a bear market in trust, even among the elite.
The Nattering One muses... We have nattered many a time... let nature take its course, NO ONE and NOTHING can STOP this TRAINWRECK...
And ANY attempt to do so will only prolong and worsen the situation.
So the pack of lying whores on the hill thought they could fool the professionals?
What a pompous pack of prostitutes, catering to their greedy banking pimps. All truly mental midgets that are absolutely worthless wastes of skin.
These elitist idiots can't even save themselves, much less the country they have run into the ground. I wouldn't hire any of them, to wash my car.
From Jon Markmans latest... It's A Great Time To Be Afraid
"If you really read the bill, and understand how it will be interpreted, it's the scariest thing you ever saw,"
said the trader, who asked me not to use his real name.
"These guys have no idea what they're unleashing."
check out Section 113 of the bailout bill, titled "Minimization of long-term costs and maximization of benefits for taxpayers."
This is the section that Congress haggled into the bill to ensure a payoff, via warrants, for citizens if mortgages purchased from banks are later sold for a profit.
Yet the "trader" says bank lobbyists snookered the government by sneaking in an exception under subsection 3a,
"Conditions on purchase authority for warrants and debt instruments."
The clause, titled "Exceptions -- De Minimis," states that any debt instruments worth less than $100 million won't trigger the payback provision.
banks will simply issue their debt in tranches of $99 million or less, and avoid allowing the government
-- and thus taxpayers -- to get a piece of the banks' profits. "It's a joke," he scoffed.
Other traders who scanned the bill came to the same conclusion, through their own prisms,
agreeing that the bill would provide only an illusion of action while failing to address the key problems facing the financial system:
Too many houses will remain on the market; they were bought with too much leverage that is vaporizing in spurts;
and those losses have left banks with too little capital from which they can lend.
Even worse, the traders pointed out, the government can make money on the loans only if it pays so little for them that they can be sold at a much higher price.
And yet if the government doesn't pay enough, then the banks won't receive enough to make a difference in their balance sheets.
So here's how the taxpayers will be cheated, they said:
Banks will take advantage of the suspension of mark-to-market accounting by stating that loans originally held at "par," or the equivalent of the purchase price,
and now valued by the market at 20 cents on the dollar, will really be worth 85 cents if held until the loan matures.
The banks will then sell the loans to the government at a fake discount of 75 cents on the dollar.
"The lobbyists made sure this bill was rammed through so that these rip-offs couldn't be fixed in committee," said another trader.
"Everyone on the Street knows it solves nothing." This is why there's a bear market in trust, even among the elite.
The Nattering One muses... We have nattered many a time... let nature take its course, NO ONE and NOTHING can STOP this TRAINWRECK...
And ANY attempt to do so will only prolong and worsen the situation.
So the pack of lying whores on the hill thought they could fool the professionals?
What a pompous pack of prostitutes, catering to their greedy banking pimps. All truly mental midgets that are absolutely worthless wastes of skin.
These elitist idiots can't even save themselves, much less the country they have run into the ground. I wouldn't hire any of them, to wash my car.
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