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Geithner Plan Will Rob US Taxpayers: Stiglitz - Economy * US * News * Story - CNBC.com (http://www.cnbc.com/id/29848741 - broken link)
Quote:
The U.S. government plan to rid banks of toxic assets will rob American taxpayers by exposing them to too much risk and is unlikely to work as long as the economy remains weak, Nobel Prize-winning economist Joseph Stiglitz said on Tuesday.
"The Geithner plan is very badly flawed," Stiglitz told Reuters in an interview during a Credit Suisse Asian Investment Conference in Hong Kong.
"Quite frankly, this amounts to robbery of the American people. I don't think it's going to work because I think there'll be a lot of anger about putting the losses so much on the shoulder of the American taxpayer."
What else is new. Obama's plans are full of high-way robbery.
Let the banks fail or any other entity that made bad investments/choices.
It comes as no surprise, since people who supported the idea of nationalization of these corporations were going to be disappointed with this plan. Wall Street was going to love it, and did.
Then there are some people who will be disappointed regardless of action or inaction. Right sanrene?
Why did wall street respond so favorably to this plan Monday?
Because the taxpayers are going to foot the bill for a giant shell game that benefits Wall Street. Geithner's plan can be gamed. Everyone knows it. Taxpayers should be outraged - they're the ones who will be stuck with the bill.
That didn't take long - sounds like BofA and Citi plan on selling toxic assets to each other at inflated prices in order to manipulate the mark-to-market pricing for the cherry-picked assets retained on their books. This seems to be such a good deal that they're now also stocking up on Alt-A and ARM mortgages to add to the mix. Sell the crap to each other for close to full face value with taxpayer backstopped no-recourse loans and boost the value of retained assets. It's a win-win for them. Who pays for the culled toxic assets? The taxpayers, because with a no-recourse loan BofA and Citi can just forfeit the toxic assets they bought from each other instead of repaying the taxpayer-funded loan. It Looks Like Citi And Bank Of America Are Already Gaming The System (C, BAC)
It almost seems like this was the plan all along, with the government's blessing - a way to ream the taxpayers for the toxic assets bailout without it looking so obvious.
Last edited by InformedConsent; 03-25-2009 at 06:06 PM..
That didn't take long - sounds like BofA and Citi plan on selling toxic assets to each other at inflated prices in order to manipulate the mark-to-market pricing for the cherry-picked assets retained on their books. This seems to be such a good deal that they're now also stocking up on Alt-A and ARM mortgages to add to the mix. Sell the crap to each other for close to full face value with taxpayer backstopped no-recourse loans and boost the value of retained assets. It's a win-win for them. Who pays for the culled toxic assets? The taxpayers, because with a no-recourse loan BofA and Citi can just forfeit the toxic assets they bought from each other instead of repaying the taxpayer-funded loan. It Looks Like Citi And Bank Of America Are Already Gaming The System (C, BAC)
It almost seems like this was the plan all along, with the government's blessing - a way to ream the taxpayers for the toxic assets bailout without it looking so obvious.
They wouldn't do that! They caaaarrrrre about us too much to stick us in the arse with this!
Where's some rich person or corporation I can blame for this, there's gotta be one left somewhere!
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