Hear About The Phony Outrage Over Financial Rescue

All week we heard how unpopular the the "bailout" was. Members of Congress, mostly Republicans, claimed that they were getting calls at a rate of 10,000,000 to 1 against the plan. lol

Of course this encouraged opponents to use that as an example to show that Americans were overwhelmingly against the plan.

But polling from the Pew Research Center (and other sources) tell a different story. (click audio tab from NPR page).

House Bailout Vote

Yeah 207 (141 D, 66 R)
Nay 226 (94D, 132R)

Dow down 777.68 points
S.&P. 500 Index
Down 95 (-7%)

It's sort of amusing, watching folks scurry around, trying to 'convince' folks.

I don't know how I feel. On the one hand, I believe this is a hustle. On the other hand, some seriously bad ($*% is happening out there. Firms that have been around for a 100 years, collapsing like this, is like one burning building after another. Bottom line for me: I just don't trust these mofos.

The Democrats came through. Boehner was supposed to deliver 100 Republican votes, and he didn't.

If true, Obama is SO playing chess....BWA HA HA HA HA

(wouldn't even look him in the eye- P.A.B.)

This is from Talking Points Memo:

Humiliated

Jonathan Weisman has a fascinating, even riveting narrative of what went down in Washington on Thursday as John McCain made his play to commandeer the high-level negotiations over the bailout bill. And TPM Reader TW called my attention to a passage that may help to explain the smoldering hostility that made it impossible for McCain even to make eye contact with Barack Obama during last night's debate.

We pick up Weisman in that big meeting at the White House ...

Pelosi said Obama would speak for the Democrats. Though later he would pepper Paulson with questions, according to a Republican in the room, his initial point was brief: "We've got to get something done."

Bush turned to McCain, who joked, "The longer I am around here, the more I respect seniority." McCain then turned to Boehner and Senate Minority Leader Mitch McConnell (R-Ky.) to speak first.

Boehner was blunt. The plan Paulson laid out would not win the support of the vast majority of House Republicans. It had been improved on the edges, with an oversight board and caps on the compensation of participating executives. But it had to be changed at the core. He did not mention the insurance alternative, but Democrats did. Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, pressed Boehner hard, asking him if he really intended to scrap the deal and start again.

No, Boehner replied, he just wanted his members to have a voice. Obama then jumped in to turn the question on his rival: "What do you think of the [insurance] plan, John?" he asked repeatedly. McCain did not answer.

One Republican in the room said it was clear that the Democrats came into the meeting with a "game plan" aimed at forcing McCain to choose between the administration and House Republicans. "They had taken McCain's request for a meeting and trumped it," said this source.

Congressional aides from both parties were standing in the lobby of the West Wing, unaware of the discord inside the Cabinet room, when McCain emerged alone, shook the hands of the Marines at the door and left. The aides were baffled. The plan had been for a bipartisan appearance before the media, featuring McCain, Obama and at least a firm statement in favor of intervention. Now, one of the leading men was gone.

Assuming this is an accurate portrayal of events, it may help explain some of what happened last night.

--Josh Marshall

Now ladies and gentlemen, Senator Country Last's arrogance knows no bounds. He doublecrosses Obama and tries to grandstand, and just thought Obama was gonna sit down and take it. Why? Cause he's John McCain?

G-T-F-O-H

He's mad that Obama didn't go along with the humiliation that he and Shrub had cooked up.

Aweeeeee. Poor baby.

CNN: Obama Tried to Rescue Meeting, McCain Was Silent

From DailyKos:

CNN: Obama Tried to Rescue Meeting, McCain Was Silent
by EmperorHadrian
Thu Sep 25, 2008 at 08:38:41 PM PDT

Fourty years of republican misrule has brought us to this. Financial ruin at every level. But CNN reported on what happened inside the meeting at the White House today. Its failure seems to have caused the failure of this deal, and this meeting would not have occured if McCain hadn't demanded it. He took another huge gamble, and lost. After the cameras left, Boehner started ranting about the right wing "plan" (deregulation, capital gains tax cuts, and an insurance plan that Paulson said won't work). Bush was silent, and McCain said nothing. It seems as though Obama was the only one who tried to lead the meeting to some productive conclusion. CNN said that Obama first tried to reason with Boehner, and ask him to detail what his plan was. After he did this, Obama calmly asked Paulson if it would work, and Paulson said that it definately would not work (which was why house republicans didn't ask him about this at the meeting yesterday). Obama continued with his attempts to salvage the mess that McCain created and refused to correct, but was unable. Again we see how much we need Obama and his leadership, and how disastrous McCain would be.

EmperorHadrian's diary :: ::
Barney Frank just said that Lindsey Graham is now saying that the plan to allocate 20% of profits made to housing assistance for low income home owners is not acceptable, even though Senators Corker and Bennett said it was acceptable this morning. This goes further to the point that McCain is actively trying to kill this deal. You can't reason with a house full of ideologues any more than you can teach a dog calculus.

It is plainly obvious that McCain was principaly responisble for the failure of this bailout deal. And, for everyone here, this is a bailout of main street, not wall street. Without credit, main street cannot function. Plus taxpayers will probably make a profit, or at least lose very little money. Without it, we are possibily looking at Great Depression II, and the sequel is always worse than the original.

Update: The New York Times does mention this incident in a new article.

Instead he [McCain] found himself in the midst of a remarkable partisan showdown, lacking a clear public message for how to bring it to an end.

At the bipartisan White House meeting that Mr. McCain had called for a day earlier, he sat silently for more than 40 minutes, more observer than leader, and then offered only a vague sense of where he stood, said people in the meeting.

...

Still, by nightfall, the day provided the younger and less experienced Mr. Obama an opportunity to, in effect, shift roles with Mr. McCain. For a moment, at least, it was Mr. Obama presenting himself as the old hand at consensus building, and as the real face of bipartisan politics.

Update 2: Remember this Kossacks, what do all great presidents have in common? Think Lincoln or FDR. They all came into office during a time of extreme crisis. Good times don't make great presidents. Bad times make great presidents, or in McCain's case, absolute disasters.

Obama being Presidential. I'm not surprised.

McCain is a joke, a fraud, and a Punk @#%$+~^@%!

AIG to Get Government Bailout

From The International Herald Tribune:

Fed to give AIG $85 billion loan and take 80% stake
By Michael J. De La Merced and Eric Dash
Published: September 17, 2008

In an extraordinary turn, the Federal Reserve agreed Tuesday night to take a nearly 80 percent stake in the troubled giant insurance company, the American International Group, in exchange for an $85 billion loan.

The Federal Reserve and Goldman Sachs and JPMorgan Chase had been trying to arrange a $75 billion loan for the company to stave off the financial crisis caused by complex debt securities and credit default swaps. The Federal Reserve stepped in after it became clear Tuesday afternoon that the banking consortium would not be able to complete the deal.

Without the help, AIG was expected to be forced to file for bankruptcy protection.

The need for the loans became necessary after the major credit ratings agencies downgraded AIG late Monday, a move that likely to have forced the company to turn over billions of dollars in collateral to its derivatives trading partners worsening its financial health.

Until this week, it would have been unthinkable for the Federal Reserve to bail out an insurance company, and AIG's request for help from the Fed of just a few days ago was rebuffed.

Rest of article at link above.


Riddle me this, MOA readers..

Why isn't this called WELFARE?

Government to take over Freddie Mac and Fannie Mae

Hat tip: DailyKos

This is SUCH a big deal.

Here is the NYTimes story:

U.S. Rescue Seen at Hand for 2 Mortgage Giants
By STEPHEN LABATON and ANDREW ROSS SORKIN
Published: September 5, 2008

WASHINGTON — Senior officials from the Bush administration and the Federal Reserve on Friday informed top executives of Fannie Mae and Freddie Mac, the mortgage finance giants, that the government was preparing to seize the two companies and place them in a conservatorship, officials and company executives briefed on the discussions said.

The plan, effectively a government bailout, was outlined in separate meetings that the chief executives were summoned to attend on Friday at the office of the companies’ new regulator. The executives were told that, under the plan, they and their boards would be replaced, shareholders would be virtually wiped out, but the companies would be able to continue functioning with the government generally standing behind their debt, people briefed on the discussions said.

It is not possible to calculate the cost of any government bailout, but the huge potential liabilities of the companies could cost taxpayers tens of billions of dollars and make any rescue among the largest in the nation’s history.

The drastic effort follows the bailout this year of Bear Stearns, the investment bank, as government officials continue to grapple with how to stem the credit crisis and housing crisis that have hobbled the economy. With Bear Stearns, the government provided guarantees and the bulk of its assets were transferred to JPMorgan Chase, leaving shareholders with a nominal amount.

Under a conservatorship, the remaining common and preferred shares of Fannie and Freddie would be worth little, and any losses on mortgages they own or guarantee could be paid by taxpayers. A conservatorship would operate much like a pre-packaged bankruptcy, similar to what smaller companies use to clean up their books and then emerge with stronger balance sheets.

The executives were told that the government had been planning to announce the decision as early as Sunday, before the Asian markets reopen, the officials said.

For months, administration officials have grappled with the steady erosion of the books of the two mortgage finance giants. A fierce behind the scenes debate among policy makers has considered whether to seize the companies or let them work out their problems.

But the declining housing and financial markets have apparently now forced the administration’s hand. With foreign governments growing increasingly skittish about holding billions of dollars in securities issued by the companies, no sign that their losses will abate any time soon, and the inability of the companies to raise new capital, the administration apparently decided it would be better to act now rather than closer to the presidential election in two months.

Just five weeks ago, President Bush signed a law to give the administration the authority to inject billions of dollars into the companies through investments or loans. In proposing the legislation, Treasury Secretary Henry M. Paulson Jr. said that he had no plan to provide loans or investments, and that merely giving the government the authority to backstop the companies would provide a strong shot of confidence to the markets. But the thin capital reserves that have kept the two companies afloat have continued to erode as the housing market has steadily declined and the number of foreclosures has soared.

As their problems have deepened — and the marketplace has come to expect some sort of government rescue — both companies have found it difficult to raise new capital to absorb future losses. In recent weeks, Mr. Paulson has been reaching out to foreign governments that hold billions of dollars of Fannie and Freddie securities to reassure them that the United States stands behind the companies.

In issuing their quarterly financial statements last month, the two companies reported huge losses and predicted that home prices would fall more than previously projected.

The debt securities the companies issue to finance their operations are widely owned by mutual funds, pension funds, foreign governments and big companies.

Officials said the participants at the meetings included Mr. Paulson, Ben S. Bernanke, the chairman of the Fed, and James Lockhart, the head of both the old and new agency that regulates the companies. The companies were represented by Daniel H. Mudd, the chief executive of Fannie Mae, and Richard F. Syron, chief executive of Freddie Mac. Also participating was H. Rodgin Cohen, the chairman of the law firm, Sullivan & Cromwell, who was representing Fannie.

Rest of story at link above.

The enormity of this cannot be overstated.