Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
right, Bancorp managed to turn $6B into $18B within months, exceeding "all expectation".. Who are you trying to kid? I invest heavily in bank stocks and I know better.
Indeed they were. Bancorp is the 8th largest bank in the country with over 240 BILLION in assets. They were deemed so unstable just months ago that the SEC stopped any short selling of their stock in order to help not depress their already dier situation.
I'm asking why individuals who criticize banks for being allowed to grow so large that the taxpayers have to bail them out in the event they have trouble, have no issue when the government not only allows them to get bigger, but helps them in doing so? You dont see the contradiction here?
Of course there is a contradiction. I am not pro-bailout, but I don't cry over this deal since it works out for both parties and the tax-payer. You should now the Fed will always cover the big banks backs and help them get bigger and turn a bigger profit. Who do you think came up with the 'too big to fail' mantra? It was the Fed, Paulson and the banks, and they did in in order to get the bailout through. So, you invest in bank stocks. So do I. You must have known it was a given their stocks were going to skyrocket after the bailout. Look at their stocks now compared to a year ago. Did the bailouts work. Of course they worked. They worked for THEM.
Of course there is a contradiction. I am not pro-bailout, but I don't cry over this deal since it works out for both parties and the tax-payer. You should now the Fed will always cover the big banks backs and help them get bigger and turn a bigger profit. Who do you think came up with the 'too big to fail' mantra? It was the Fed, Paulson and the banks, and they did in in order to get the bailout through. So, you invest in bank stocks. So do I. You must have known it was a given their stocks were going to skyrocket after the bailout. Look at their stocks now compared to a year ago. Did the bailouts work. Of course they worked. They worked for THEM.
Actually the "too big to fail" babble comes from Congress, Barnie Frank just the other day talked about how he wants "too big to fail" to indeed "fail"...
If Congress is talking about destroying these companies while the FDIC helps build them up, then its only right to point out the pathetic waste of taxpayer money which will be the result.
The fact that you dont want to "cry" over the deal because it worked out I guess is the difference between you and I.. I of course want to point out the hypocracy in the left hand doing one thing while the other does another. Not recognizing the contradictions and the "psss, lets do this while saying that" is what got this country into the current problems..
The OP is likely using the term "jackpot" to indicate one big cluster**ck of bank failures, perhaps as to educate folks into realizing this is the effect of bailing out the big boys and endlessly inflating bubbles, as opposed to rooting for failure.
It's merely more of the ongoing cleanup made necessary by the eight years of economic excess and malfeasance that mercifully came to an end last January. And we are a long way from being done with that cleanup yet. The staggering dimensions of the failures of the previous administration still assure us of that.
The procedures by which failed banks are unwound meanwhile vary, but these are all pages taken from the same book. These nine banks were reviewed by state banking regulators, who then passed the situation on to FDIC which had already parsed the assets and losses into a market-based package that used loss-sharing to protect the private sector value of assets while also minimizing public sector losses. There is nothing unusual about the process. It simply tailors the overall package to create a clean fit into the books and operations of the receiving bank. The announcement of the deal was made late in the day so as to minimize disruptions in bank operations. Affected branches closed business Friday as the original banks, and they opened for business as usual as US Bank branches Saturday morning. There was no interuption in check processing, the operation of ATM's or debit/credit cards, or in loan servicing. The deal was in effect invisible everywhere except on paper.
Last edited by saganista; 10-31-2009 at 08:44 PM..
Actually the "too big to fail" babble comes from Congress, Barnie Frank just the other day talked about how he wants "too big to fail" to indeed "fail"...
If Congress is talking about destroying these companies while the FDIC helps build them up, then its only right to point out the pathetic waste of taxpayer money which will be the result.
The term was coined by Reagan's Treasury Dept when a big bank in Illinos was going under. The Govt announced it was too big to fail and went ahead and purchased a ton of that banks stocks (80%), fired the management and gave them billions of dollars. That was the birth of TBTF policy. And last year, it was not the Congress who initiated the bail-outs, it was the Fed and Paulson who talked Bush into it and then talked Congress into it. Paulson told Congress that there would be riots and martial law on the streets unless they passed it.
So, yes, now Obama admin wants to kill the TBTF policy, so it makes sense to ask why US Bankcorp is allowed to grow. It's a fair question. The truth is that Bankcorp was not that big. The nine banks had combined assets of 18 billion, to they can't have been that big. US Bankcorp assets were 266 billion, and you can compare that to the Wall Street big hitters (2007) like Goldman Sachs (1 trillion), Meryll Lynch (1 trillion), Citigroup (2.2 trillion), BofA (1.5 trillion) JPM (1.4 trillion) etc there were banks who were in the club of TBTF, and US Bankcorp was not a member in that club. They are #12 in the list. Big? Sure, but not TGTF.
That's what I mean. Bailing out big boys and leaving the small fries out to dry is like cutting off one of your testicles and then asking you to procreate.
Ouch! That's still more than enough to ge the job done though you know (not making any point when I say that....just a biological fact).
The term was coined by Reagan's Treasury Dept when a big bank in Illinos was going under. The Govt announced it was too big to fail and went ahead and purchased a ton of that banks stocks (80%), fired the management and gave them billions of dollars. That was the birth of TBTF policy. And last year, it was not the Congress who initiated the bail-outs, it was the Fed and Paulson who talked Bush into it and then talked Congress into it. Paulson told Congress that there would be riots and martial law on the streets unless they passed it.
So, yes, now Obama admin wants to kill the TBTF policy, so it makes sense to ask why US Bankcorp is allowed to grow. It's a fair question. The truth is that Bankcorp was not that big. The nine banks had combined assets of 18 billion, to they can't have been that big. US Bankcorp assets were 266 billion, and you can compare that to the Wall Street big hitters (2007) like Goldman Sachs (1 trillion), Meryll Lynch (1 trillion), Citigroup (2.2 trillion), BofA (1.5 trillion) JPM (1.4 trillion) etc there were banks who were in the club of TBTF, and US Bankcorp was not a member in that club. They are #12 in the list. Big? Sure, but not TGTF.
Congress writes the bills and authorizes the spending. Dont even begin to give them a pass by blaming the Fed and Paulsen.
Bancorp (no K) is the 8th largest bank in the nation, they are indeed BIG..
And had this been any other larger bank that received tarp funds, I would indeed be asking the very same question.
Its kind of hypocritical for the left to be blaming Bush for allowing these banks to get so big, (even though it was Clinton who signed the bill), while at the same time making up excuses for not only allowing them to get bigger, but helping them. I dont care if its a 1% increase, or a 5% increase, if your unstable enough to have needed TARP anytime recently, then indeed you havent fixed your books fast enough to then be bailing out other banks.
Congress writes the bills and authorizes the spending. Dont even begin to give them a pass by blaming the Fed and Paulsen.
Bancorp (no K) is the 8th largest bank in the nation, they are indeed BIG...
I am not giving anyone a pass, I said the Fed, Paulson and Bush INITIATED the bailouts. That is a historical fact. If you want to deflect all the blame away from them, then that's your partisan game, not mine. If you remember the TARP bill was meant for one thing, and as soon as it had passed Paulson announced that "situation has changed" and he used the money for things it was never intended for (and voted for). So it is fair to say he lied to Congress to get them to vote for the money.
Bancorp is #12, and less than one eighth of the size of Citigroup, so they may be big, but not too big to fail.
I haven't blamed Bush for allowing them to get too big. Like I told you there were TBTF companies during Reagan era already, so we might as well blame him, or Carter before him. What's the point? You don't have to rush into Bush's defence when he is not being accused.
Hundreds of companies received TARP money, and only a fraction of them were too big to fail.
Its kind of hypocritical for the left to be blaming Bush for allowing these banks to get so big...
You act like size was somehow the problem. The B in TBTF comes into play only when the F does. Ordinarily, size would serve as a buffer, allowing profitable operations to carry those that might have run into trouble. To screw up something as big as the big banks requires a level of malfeasance so grand as to be capable of infecting absolutely anything and anybody. That is exactly where your blind and oblivious heroes took us.
Under the heretofore unimagineable circumstances that we presently still find ourselves in, there is not an existing and viable means for unwinding the operations of giant banks. The obvious solution is outright nationalization. Which was carefully considered. There are however serious problems in how to return any major nationalized bank to the private sector once its operations have been disentangled and set onto sustainable bases. In order to avoid those, we are engaged in the current process instead, one which is akin in some ways to trying to get a wad of bubble gum out of a little girl's hair. It should never have gotten there to begin with, but it has, and unwilling to just give her a buzzcut, we are having to sit and go through a great deal of work to fix things strand by strand. This is the price we pay for a simple dose of laissez-faire stupidity.
Mortgage-backed securities (MBS) are debt obligations that represent claims to the cash flows from pools of mortgage loans, most commonly on residential property. Mortgage loans are purchased from banks, mortgage companies, and other originators and then assembled into pools by a governmental, quasi-governmental, or private entity. The entity then issues securities that represent claims on the principal and interest payments made by borrowers on the loans in the pool, a process known as securitization.
Most MBSs are issued by the Government National Mortgage Association (Ginnie Mae), a U.S. government agency, or the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), U.S. government-sponsored enterprises. Ginnie Mae, backed by the full faith and credit of the U.S. government, guarantees that investors receive timely payments. Fannie Mae and Freddie Mac also provide certain guarantees and, while not backed by the full faith and credit of the U.S. government, have special authority to borrow from the U.S. Treasury. Some private institutions, such as brokerage firms, banks, and homebuilders, also securitize mortgages, known as "private-label" mortgage securities.
Article:
"Cal National lost 500 million On heavy investments in Fannie Mae and Freddie Mac preferred shares."
Thank You Congressman Frank!
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
