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Regarding posts 12, 13, and 14, please see McCulloch v. Maryland (1819.) Justice Marshall wrote, "It is not enough to say, that it does not appear that a bank was not in the contemplation of the framers of the constitution. It was not their intention, in these cases, to enumerate particulars. The true view of the subject is, that if it be a fit instrument to an authorized purpose, it may be used, not being specially prohibited."
''Let the end be legitimate,'' he wrote, ''let it be within the scope of the Constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consistent with the letter and spirit of the Constitution, are constitutional.''
The notion that the Congress doesn't have the authority to make a commercial transaction (a loan in exchange for assets) to a bank is absurd on its face.
the problem with your whole argument is that it wasnt the US Government buying the assets, it was the Federal Reserve, and the FRB limits debt to government securities
Meanwhile all of us investors and taxpayers get screwed over. I can see why you are so freaking happy that the government bailed out the financial institutions that crashed the economy.
If you let big financial institutions go bankrupt, as a moral gesture, you will bring on a depression that would take a decade to repair -- bringing on much harsher upheaval on investors and taxpayers than one can imagine.
History says that financial players will overreach even if they don’t expect a bailout. It’s really hard to envision a financial system in which we can blithely let major institutions fail knowing the dire consequences.
Do I think the bailouts were handled correctly? No. I would have taken over the banks and run them until they were stable until resold. Instead of begging the banks to lend with government money, the government run bank would make loans. Of course, instead of executives getting huge bonuses, they would be fired.
Good post. What's funny is when people who don't have a penny to their name and are absolutely clueless about how the economy works pretend that they have money invested in something. They don't mention how stocks responded positively to the bailouts that happened.
If you let big financial institutions go bankrupt, as a moral gesture, you will bring on a depression that would take a decade to repair -- bringing on much harsher upheaval on investors and taxpayers than one can imagine.
History says that financial players will overreach even if they don’t expect a bailout. It’s really hard to envision a financial system in which we can blithely let major institutions fail knowing the dire consequences.
Not exactly. The big financial institutions were never in danger of going backrupt because they held so many securities that were backed by the federal government/Fannie/Freddie.
Saving the financial institutions, saved the US Government..
Quote:
Originally Posted by MTAtech
Do I think the bailouts were handled correctly? No. I would have taken over the banks and run them until they were stable until resold. Instead of begging the banks to lend with government money, the government run bank would make loans. Of course, instead of executives getting huge bonuses, they would be fired.
There were lots of banks that were taken over and stablized to be resold. No surprise though to see you once again high 5ng government ownership and control of privately owned assets..
Tell me, how exactly would you have taken over ownership, and not been forced to guarantee the assets that you backed, i.e. being the government? And when you, i.e. the government, couldnt back the trillions of dollars worth of assets that you guaranteed, who exactly do you think should have taken ownership of the government until it could have been resold?
First, the government didn't "nationalize" Citibank. It did nationalize Freddy and Fannie.
Second, it wasn't government policies that caused the collapse. It was more like relaxing laws and regulations that existed for 80 years that caused the collapse. In other words, there weren't government forces in place to prevent the greedy banksters from killing the economy for their own benefit.
Third, there is nothing wrong with the government (our government) making a profit. If they took a lose, the same people would be 8itching about the lose.
So, in other words, it was government policy which allowed the bankers to sink the financial sector. Gotcha.
Not exactly. The big financial institutions were never in danger of going backrupt because they held so many securities that were backed by the federal government/Fannie/Freddie.
Saving the financial institutions, saved the US Government..
Citigroup, the nation's third-largest bank by assets, was on the verge of being closed by regulators the week of Nov. 24, 2008 as depositors rapidly withdrew money and the bank's counterparties declined to provide it credit, according to a government report released Thursday.
So, in other words, it was government policy which allowed the bankers to sink the financial sector. Gotcha.
No, it was deregulation that didn't stop the financial sharks from performing mischief.
Your argument, blaming the government for the crisis because of lack of regulations, is equivalent to blaming the police for causing murders because they didn't catch a serial murder sooner.
Well, I guess it was a good idea after all. It kept the banking system from collapsing and then the government earns a profit.
Really? A good idea after all
sheesh. How short sited
We would of profit more if we would of let the forest burn down, and thousans of new smaller trees grown up where these deadly giants used to grow. Now we got banks that are soo big and no smarter than they were when they ruined the economy
Congrats USA, you have set us up to repeat the failures over and over again
thanks a lot.
profiting from this is a stupid hallmark to show success
Citi, just like the other publicly traded corps, like JPM and GS have govt as largest shareholder so yes they get to enjoy their profits. I doubt you can find a single publicly traded corp of which the govt isn't controlling shareholder. Just because the govt profits doesn't mean you do however.
Been like this for awhile.
Breakdownofthe $26Trillionthe Federal Reserve Handed Out ...
quote:
Page 131 – The total lending for the Fed’s “broad-based emergency programs” was $16,115,000,000,000. That’s right, more than $16 trillion. The four largest recipients, Citigroup, Morgan Stanley, Merrill Lynch and Bank of America, received more than a trillion dollars each.
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