Bush Bailout Speech

[al_bundy]

Lehman was very low on the CDS list, unlike AIG which wrote hundreds of billions of $$$ worth of CDS's. don't forget that after Lehman went belly up a lot of MM's lost value and this caused a stampede out of MM's. only reason things calmed down is the government stepped in again

 

[TromboneAl]

pins-triped suits

Brat, you'll be hearing from the folks in the grammar thread pretty soon.

 

[REWahoo]

Brat, you'll be hearing from the folks in the grammar thread pretty soon.

I'm pretty sure that just happened...

 

[bright eyed]

how are you going to manage all this and make sure people actually pay the mortgage? remember that most of these people refi'd themselves to riches and luxury.

much easier to press a computer key and buy up a bunch of bonds. the infrastructure is already in place for this and no new government employees have to be hired to do nothing but write checks

If you ref'd your mortgage and purchased a big screen, nice cars and other toys, we could have the government agree to refi your mortgage but you have to give us your stuff. Sarah Palin can put them on ebay! and the taxpayers will recover some of the money from the bail out and have a huge reservoir of cheap luxury items to purchase with the stimulus check they will issue in the next year or so...

 

[Zoocat]

China was loaded to the gills with Fannie/Freddie MBS. They were leaning on Paulson.

Ha

YES! I have had a gut feeling that there was a subtext to this whole thing and that some international lender is really pissed and let Paulson know what would happen if we didn't make good on our bad paper.

Unfortunately there's no way to prove it. That's why all Paulson, Bernanke and congresspeople are so lame in their explanations of what will happen if this bailout doesn't happen. There's no way they can say to the American taxpayer, the Chinese will stop lending us money and then we are screwed! The truth is too embassassing. Also, the Chinese would be really pissed if Paulson blamed it on them.

And, of course, GW obviously knows this and that's why he looked like a deer in the headlights (or a zombie!) as he read his speech last night.

 

[jIMOh]

My understanding from the speech is the 700 billion will be used to buy the illiquid securities. These are the securities that Bear Stearns cannot sell and many other financial companies (Vanguard, Fidelity, T Rowe Price et al) probably hold some of these too.

My further understanding is that 700 billion is being used because this is the value of the loans (at the times the loans were made). They are worth much less than 700 billion now. As the mortgage are repaid, the treasury is going to keep the payments to repay the 700 billion.

That is what I got out of the speech. Can someone tell me if this is too simplistic?

 

[d]

Hoo-boy. If this one avoids the Soap Box, it may be a miracle...

as herein evidenced, miracles do happen!

 

[bright eyed]

Jon Stewart's staff is always hard at work!

YouTube - Bush Economic Meltdown Speech

 

[Brat]

My "pins-triped suits "

Brat, you'll be hearing from the folks in the grammar thread pretty soon.

Sorry for the typo.

I just got a cast off my right arm after hand surgery for a bad break (a tale I have withheld as others have greater problems). I am re-learning how to move my fingers and turn my wrist as the nerves want to construct a cast of it's own under my dermis.