I'm sorry ... I must be reading this incorrectly:
US Weighing Plan to Set Up Facility to Hold Bad Debts
Treasury Secretary Henry Paulson is working on a plan that would set up a government facility to take on bad debts from financial institutions, preventing a worsening of the global credit crisis, Wall Street sources have told CNBC.
The facility would be similar to the Resolution Trust Corporation, which was set up in the late 1980s to take on all the failed thrift assets during the savings and loan crisis, these sources said.
Paulson is said to be shopping the proposal to lawmakers in Congress, a congressional aide told Reuters.
Such a move, according to its advocates, would allow banks to shovel bad debt off their balance sheets and send them back to business as usual.
I must have slept through the sudden metamorphosis of right-wing capitalism, when independence, self-reliance, dog-eat-dog and "only the strong survive" became optional.
In unrelated news, people on welfare are disgusting leeches on society. Or something to that effect.
5 comments:
Don't forget about the 85 billion USD for AIG's bailout. This sum would go an awful long way to providing health insurance for the 47 million Americans who are without any coverage.
Maybe it's time to bring back Debtors Prison -- but only if you owe more than a billion dollars.
A large proportion of these bad debts and mortgages are underwritten by China.
The USA, with its deficit-defying budget, will continue to need China to lend money to keep its wars of choice going for the next few years. China will be far less willing to do so if these large insurance companies default on the loans that China has underwritten.
There's a good reason the government is keeping these companies solvent; otherwise, it might soon be insolvent itself. Funny, isn't it, how powerless you become when you owe a lot of money to someone bigger and smarter than you.
I must have slept through the sudden metamorphosis of right-wing capitalism, when independence, self-reliance, dog-eat-dog and "only the strong survive" became optional.
A general observation from the last few days: major pundits have simply gone from not noticing any downside to deregulation in the last few decades to remarking that state intervention is back.
This is how it works. This is how is always works.
state intervention is back
For some reason, it all reminds me of this
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