WSJ reports today that the US government will be buying portions of nine top banks as part of the Bailout package:
To kick off Tuesday's expected announcement, the government is set to buy preferred equity stakes in Goldman Sachs Group Inc., Morgan Stanley, J.P. Morgan Chase & Co., Bank of America Corp. -- including the soon-to-be acquired Merrill Lynch -- Citigroup Inc., Wells Fargo & Co., Bank of New York Mellon and State Street Corp., according to people familiar with the matter.Some of the big banks were unhappy about the government taking equity
stakes, but acquiesced under pressure from Treasury Secretary Henry
Paulson in a meeting Monday. During the financial crisis, the
government has steadily increased its involvement in financial markets,
culminating with a move that rivals the breadth of the government's
response to the Great Depression. It intertwines the banking sector
with the federal government for years to come and gives taxpayers a
direct stake in the future of American finance, including any possible
losses. Remind your Representative this is what he/she voted for (if so), as there is surely more to come. Then get out there and work for the ones who had the backbone to vote against nationalization of the banks. Categories: Finance, Federal Legislation, Socialism, Economy Tags:
Posted by Don Rasmussen on 10/13/08 Last updated 10/14/08
If you have been busily watching your portfolio disappear, you may not have noticed that the same thing was happening to a little island nation in the north Atlantic. Iceland is, quite literally, broke.
The currency has no value. It has become impossible for the government, which has already nationalized the banks, to control the money because no one will take it including the international companies that the island relies on for their lifeline. The effects on ordinary islanders is terrible and getting worst. Can you imagine facing these conditions here?
On the bright side, it is now cheaper to fly from New York to Reykjavik and stay at the Hilton then it is to spend the weekend in New York.
Posted by Don Rasmussen on 10/13/08 Last updated 10/13/08
Kenric Ward is out with a great piece on Scripps News that takes a critical look at the roles of the duopoly and the media in keeping any democracy from breaking out.
Democrat, GOP stranglehold stifles third party candidates
By KENRIC WARD, Scripps Howard News Service
Be honest. What have you learned from the first two presidential debates? Do you expect to be any more enlightened by Wednesday night's third and final showdown between Barack Obama and John McCain?
If you're like my friends and associates outside the newsroom, you're setting the bar pretty low. If these "debates" have proven anything, they confirm our two-party choice is dumb and dumber (you pick).
Posted by Don Rasmussen on 10/13/08 Last updated 10/13/08
The Treasury bailout will only exacerbate red ink and inflation. By Ron Paul
One of the burning questions regarding the recently passed bailout, and the one that almost no one has bothered to answer, is how the government intends to pay for it. Governments have three main methods by which they can raise funds: taxation, printing new money, and debt. As our $10 trillion national debt shows, the federal government has always enjoyed raising money by issuing new debt. Money is gained upfront, while the cost of repaying that debt is pushed onto future generations.
Posted by Don Rasmussen on 10/13/08 Last updated 10/13/08
McClatchy is reporting on a GOP talking point memo in which delegates were advised, when asked by media about indicted Alaska Senator Ted Stevens, to say, "As long as he does not receive jail time, he is legally capable of serving."
So the new ethical standard for Republican office holders is "anything short of a conviction is o.k. with us." It's not too hard to understand why the party has lost its legislative and electoral majorities.
After the wreckage of this election cycle is fully known, the GOP is going to have a lot of soul searching to do.
Clearly running as the ethically-ambiguous, Democrat-Lite party is a failing strategy. "Me too" is not a political platform whether talking about entitlements or bailouts, as the Republican Party is about to learn.
Only when Republicans begin acting like Republicans will they again see electoral success. Standing firm on issues like spending, taxes, and personal liberty is key to what should be the next reasonable, achievable goal for the GOP -- retaking the House in 2010. Running ethical, principled candidates will help.
Posted by Don Rasmussen on 10/13/08 Last updated 10/13/08
Yup, humanity is doomed.
Paul Krugman, a professor at Princeton University and an Op-Ed columnist for The New York Times, was awarded the Nobel Memorial Prize in Economic Science on Monday.
Krugman received the award for his work on international trade and economic geography. In particular, the prize committee lauded his work on for "having shown the effects of economies of scale on trade patterns and on the location of economic activity."
Posted by Don Rasmussen on 10/12/08 Last updated 10/12/08
Early trading starts soon. Given the moves by various governments and extra-governmental institutions this weekend, do you anticipate that Friday's slide represented the bottom or are we in for another rough week as the meltdown continues?
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