Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Giordano Bruno who wrote (192786)	3/23/2009 9:49:20 PM
From: geode00	Read Replies (1) \| Respond to of 306849

The US taxpayer paid 100 cents on the dollar, in the dead of night through AIG, to those who would have lost their shirts. Why in the blessed heck are we doing yet another rescue of the same people. On top of everything else, Summers is telling us that we are so stupid that we shouldn't even try to limit executive compensation because, heck, we are so much dumber and less important than the masters of the universe who got themselves and us into this ridiculous situation. I like how, on the same day as this story, one of the networks was talking about how the banks were playing destructo with the credit ratings of their customers. The banks are simply reducing credit lines in order to reduce their own risk profile which lowers a person's credit rating which subsequently increases their borrowing costs which benefits...THE BANKS. What? The example was a couple with a rating in the mid 800s, a perfectly good credit risk who lost 100 points on their rating because their bank decided to close out cards or reduce their limit. They didn't do anything wrong, they simply paid their bills on time. If they roll over credit they will, I am sure, see a sizeable increase in their borrowing costs simply because the bank made this unilateral action. What? This is TOO MUCH. The reaction of 'investors' like Blackrock are highly suspicious IMO. They smell free money and they came out in droves. Something is definitely wrong here.

To: Giordano Bruno who wrote (192786)	3/23/2009 10:14:55 PM
From: James Hutton	Read Replies (4) \| Respond to of 306849

"If I, as a "financial institution" can participate as a bidder in these auctions I can foist off my loss onto the taxpayer. Here is how I can rig the game so as to avoid an otherwise-inevitable loss: I become a "bidder" and "bid" on my own assets at 75 cents. I am providing 5 or 10% of the money. The rest is covered by Treasury, The Fed and the FDIC via guaranteed bond issuance. The loan, ex my contribution, is non-recourse. That is, I can lose 5 or 10% of the total portfolio purchased, but nothing more." I THOUGHT I heard Geithner say today that banks wouldn't be able to bid on their own loans, but even if true, there are probably lots of easy ways to get around that little inconvenience.