"Why do we have to have this separate program subsidizing BANKS to buy TOXIC assets?"

[omega minimo]

:thumbsdown: :evilfrown:

Reaganism is over. WAKE UP Americans!!!













http://www.pbs.org/newshour/bb/business/jan-june09/stressanalysis_05-07.html

JEFFREY BROWN: What about the question that, you know, we've talked about a lot here, the question of the so-called toxic assets? Does this help settle that question? Do we know more about the depth of that problem?

ROBERT GLAUBER: Well, we probably know more, but it certainly doesn't settle the problem. What this does is still leave those assets on the balance sheets of the banks. And as long as those assets are there, the banks can't fill their balance sheets up with loans to companies that can hire people, build things, lift the economy.

And that probably is the major defect of this. It leaves those toxic assets in place on the balance sheets of the banks and doesn't give them any real stimulus to move them out.

IT LEAVES THOSE TOXIC ASSETS IN PLACE ON THE BALANCE SHEETS OF THE BANKS AND DOESN'T GIVE THEM ANY REAL STIMULUS TO MOVE THEM OUT.

And that, I think, is really where people will debate this and ask, should there have been a plan that dealt with those toxic assets?

AND THAT, I THINK, IS REALLY WHERE PEOPLE WILL DEBATE THIS AND ASK, SHOULD THERE HAVE BEEN A PLAN THAT DEALT WITH THOSE TOXIC ASSETS?

JEFFREY BROWN: And, Dean Baker, you would say, "Yes"?

DEAN BAKER: Well, I mean, I think there's a real problem with the toxic assets. I mean, they're holding them on their books at prices that are well above their market value, and we do have the Geithner plan that, to my mind, is a serious subsidy.

It's basically this story where you have investors come in taking risk with the government money, which is certainly going to increase the price that the banks will get for those assets, and I'd be sort of inclined to say, well, if the banks are in such good shape, why do we have to have this separate program subsidizing them to buy these assets?

IT THE BANKS ARE IN SUCH GOOD SHAPE, WHY DO WE HAVE TO HAVE THIS SEPARATE PROGRAM SUBSIDIZING THEM TO BUY THESE ASSETS?

So I'm very troubled by, you know, how much money we're giving to the banks through the Public-Private Investment Plan and other routes. And, you know, if the banks are in great shape, why do we have to give them more money?

[w4rma]

1. The banks should have been allowed to fail. The interference is causing extra damage. (nt)

[DJ13]

2. Leaving toxic assets on the books is what caused Japan's 12 year bank crisis

This is why Obama should never have hired people too close to Wall Street to solve a crisis created BY Wall Street.

[omega minimo]

3. Aye

[dmosh42]

4. Since the banks don't need to tell us where.....

they used that 'TARP' money(troubled asset relief plan), I think they're buying into oil futures, thus driving up the gasoline prices. What a racket!

[omega minimo]

5. This most important story drops like a stone ....................

:bounce:

[Senator]

6. K&R

[DemReadingDU]

7. afternoon kick

[omega minimo]

8. much obliged. most important IMHO

:toast:

[DemReadingDU]

9. IF THE BANKS ARE IN SUCH GOOD SHAPE,

WHY DO WE HAVE TO HAVE THIS SEPARATE PROGRAM SUBSIDIZING THEM TO BUY THESE ASSETS?
---------------

Most banks are insolvent. Our taxmoney is being used to keep them afloat. Some people are beginning to wake up, but most people are still listening to the TV propaganda that recovery is just around the corner, and the stock market always comes back. Just look at that rally today!

Until the economy affects people directly, they won't pay attention.

[omega minimo]

10. "Until the economy affects people directly, they won't pay attention."

There it is. The bottom line. We've heard this for years, that "people don't care unless it affects them directly" and we've passed SO many markers that would have gotten their attention.....

So it's unavoidable that people never learn, repeat mistakes, don't think IT affects them until it's biting their nose off and will go right back to whatever mindless behavior they were at before, given the first opportunity.

AAaaaaaaaarrrrrrrrrgh.

When I heard this on the NewsHour, a bell went off. Someone SAID IT! This is it, folks, this is the key right here:

"IT LEAVES THOSE TOXIC ASSETS IN PLACE ON THE BALANCE SHEETS OF THE BANKS AND DOESN'T GIVE THEM ANY REAL STIMULUS TO MOVE THEM OUT.

"AND THAT, I THINK, IS REALLY WHERE PEOPLE WILL DEBATE THIS AND ASK, SHOULD THERE HAVE BEEN A PLAN THAT DEALT WITH THOSE TOXIC ASSETS?"




And all the Cassandras will not even bother saying "we told you so............"

Unfortunately, because that isn't going to change, nothing will change. And people won't care until it affects them and will be happy with the status quo.

What happened to "CHANGE"?

[DemReadingDU]

11. They don't want the toxic assets to be known...

They don't want people know how many trillions (quadrillions?) they grew the bubble, those trillions which are now worthless. Worthless not only in U.S., but worthless all over the world. They're hoping that by taking our taxmoney to keep the banks afloat, that they can keep these toxic assets hidden forever. We don't have enough taxmoney to do this, our debt is increasing exponentially, and eventually this bubble is going to burst. Rather than admitting their schemes and going to jail, the banksters would rather bring on a global depression. It's going to get ugly.

BTW, you should come visit us in the daily Stock Market Watch thread in the Latest Breaking News. Ozymandius posts a thread Mon thru Fri. Here's today's posting
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3867580


edit, Demeter posts a weekend thread in Editorials, usually with a theme (this weekend it's Dirty Harry!)
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x446996

[omega minimo]

12. BANKSTERS!!!!!!!!

Thanks for everything, DemReadingDU. :hi: