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| McCain may be trying to deep six the Wall Street handout plan |
| 2008-09-26 |
| If this is true, I take back everything bad I said about his actions on this handout plan. U.S. Sen. John McCain, R-Ariz., may be throwing a monkey wrench into efforts to pass a $700 billion bank bailout, instead favoring alternative plans that looks to free up capital and credit markets via tax and regulatory relief while allowing financial institutions to temporarily skip dividend payments to shareholders. Republican and Democratic officials in Washington said McCain was offering alternatives Thursday to the $700 billion plan backed by the Bush administration, Federal Reserve chairman Ben Bernanke and U.S. Treasury Secretary Henry Paulson. That plan has the federal government acquiring bad mortgage assets from struggling banks with the goal of keeping them afloat and allowing more credit to flow. McCain appears to be siding with conservatives and House Republicans who question the bailout and its costs to taxpayers as well as government rescuing private lenders and perhaps taking ownership stakes in rescued banks. The alternative plan allocates less public money and relies more on tax breaks, lifting regulatory barriers and using less bailout-oriented mechanisms to free up capital and credit. It also seeks to create a privately funded mechanism to ensure mortgages and mortgage-backed securities. One Republican official said McCain is standing up for taxpayers as he, President Bush, congressional leaders and presidential foe Sen. Barack Obama try to hash out a deal. A deal was close to being finalized Thursday but House Republicans and McCain are looking to get alternatives considered. Bernanke and Paulson have warned that without action the flow of credit could totally freeze, more banks could fail and the rough economy sink into a recession. A Democratic official said Thursday McCain and U.S. House Minority Leader John Boehner are the major barriers to passage of the bailout. Public opinion polls show voters upset with the bailout plan and its relief to Wall Street bank and investment houses. Some economists and business groups support the bailout, echoing worries that if something is not done the economy and financial markets could collapse. Democrats had wanted to put stipulations on the Paulson bailout plan including limits on CEO pay. McCain's campaign and U.S. Senate office did not respond to requests for comment. |
| Posted by:Zhang Fei |
| #21 juar=just |
| Posted by: Almostout 2008-09-26 22:37 |
| #20 Holy crap! Did Obama juar say tha China was the enemy? Is anybody listening to the debate? |
| Posted by: Almostout 2008-09-26 22:36 |
| #19 I agree w/ZF. That's capitalism. |
| Posted by: Flitch the Imposter aka Broadhead6 2008-09-26 22:32 |
| #18 I'm no fan of the bailout, but NS has a good point. The Fed properly noted that the panic had gotten to the point of being potentially very harmful and also knew full well that the only thing that would settle things down would be a big enough move by the Fed to reassure everyone that the system isn't going to collapse. People weren't sure, so they - very rationally - attempting to prepare themselves for the possibility. However, ZF is also correct, bad banks (like Inymac - maybe the planets worst.), have to go. Remember: It's the failed banks that cost you the most. We back the deposits and get nothing back. What this move by the Fed has allowed, giving banks time to take an assessment of what lies ahead, is more important than the 700 billion. The consolidation in banking going on right now is what really is and will continue to be the true driver of the recovery and it will help make sure that our money goes to businesses that don't fail. Which means we get at least something for our money. Granted, what we get isn't worth nearly what we pay, but it's far better that we buy 'toxic paper' from a bank like JPM than paying out deposit insurance for MaMu. |
| Posted by: Mike N. 2008-09-26 21:38 |
| #17 Never interrupt your enemy when he is making a mistake. -- Napoleon Bonaparte |
| Posted by: DarthVader 2008-09-26 21:31 |
| #16 If the democrats feel they need cover, I am inclined to not give it to them. |
| Posted by: Ptah 2008-09-26 21:14 |
| #15 Exactly. Or they would have passed it without trying to get the trunks on board. |
| Posted by: Nimble Spemble 2008-09-26 19:24 |
| #14 What Nimble Spemble said. But the Democrat don't fear enough yet, either, or they'd have skipped the posturing and got immediately down to the serious work of hammering out a bill that could pass both Houses of Congress with enough Republican votes to give the Democrats the cover they seem to feel they need. |
| Posted by: trailing wife 2008-09-26 19:16 |
| #13 Some of these banks have investments that are worth saving, however they are attached to a lot of dead weight. Bankruptcy is capitalisms creative process for seperating the too. Conserve what works! Change what doesn't should be the core of conservatism. This bailout is the LEAST conservative thing I have ever heard. |
| Posted by: Bright Pebbles 2008-09-26 19:01 |
| #12 Agree the $700B idea is a bad one. But the fear is real and good. |
| Posted by: Nimble Spemble 2008-09-26 18:08 |
| #11 Capitalism without failure is like religion without sin. Some banks need to fail and some businesses need to be crushed to powder, before we can have a firm foundation upon which to rebuild the economy. We have over-capacity in finance and in manufacturing. That capacity came about because of excessive credit availability. Some of that marginal capacity needs to be taken out; the alternative is an even bigger bubble - this time one that will take decades to recover from. We need to end this madness today; stand athwart history and yell "Stop!" with the incessant government tinkering, this time at huge taxpayer expense. You know, it's funny - when Bernanke talked about dropping helicopter-loads of cash, he never mentioned that we would be dropping them on the wealthy denizens of Wall Street. |
| Posted by: Zhang Fei 2008-09-26 18:07 |
| #10 Yes NS, I respect you and generally agree. However, critical decision making (of the 700B USD variety) should always find it's foundation in knowledge, accurate knowledge. Not 'fear' instilled by the beltway crowd. |
| Posted by: Besoeker 2008-09-26 17:55 |
| #9 Fear is not unacceptable, it's desirable when there's somethin to be afraid of. And it'sa one of only two things that moves markets. The other is greed. We've had enough of that for a while. |
| Posted by: Nimble Spemble 2008-09-26 17:47 |
| #8 "FEAR" or stupidity. Both are unacceptable. You decide. |
| Posted by: Besoeker 2008-09-26 17:44 |
| #7 No. They are seriously afraid. The banking system came dangerously close to seizing up last Wednesday when LIBOR doubled. That was because banks did not want to lend to other banks overnight because they feared not being repaid the next morning. If you aren't afraid, you don't have any idea what is going on and how close we are to SEAFU, Situation Extraordinary. And that is a large part of the problem, not enough people have enough fear. The problem is that one group that really does not yet have the fear is the average banker. Only the guys in the head shed who aren't supposed to talk about how close the system came to seizing are properly afeared. That's why Paulson is on one knee to Pelosi. It sure ain't the Botox. Unitl the fear is so wide spread and palpable that people don't snark about fear cards will this problem be solved. And it is going to take a whole lotta pain to generate that much fear. |
| Posted by: Nimble Spemble 2008-09-26 17:37 |
| #6 Wamu Should have been done on a friday after hours. It's blatant political action to move it to in the week. |
| Posted by: Bright Pebbles 2008-09-26 17:34 |
| #5 #4 Does anyone get the feeling Bernanke and Paulson are playing the fear card? Posted by Beldar Snolurt9889 Followed closely by the...job after card. |
| Posted by: Besoeker 2008-09-26 17:34 |
| #4 Does anyone get the feeling Bernanke and Paulson are playing the fear card? |
| Posted by: Beldar Snolurt9889 2008-09-26 17:28 |
| #3 Dems in majority along with POTUS can pass this with or without the Republican minority. This is a win/win turkey shoot for McCain and the Republican party. Paloosi, The One (former ACORN Lawyer), Reid, and Big ACORN are leading the turkey flock. |
| Posted by: Besoeker 2008-09-26 17:18 |
| #2 Hopefully. It does fit with his history of trying to keep government spending down. In CCAGWÂ’s 2007 Congressional Ratings McCain scored a 100%. Pretty damn good. Seems more and more like this "deal" for a bailout is nothing more than a payout with the taxpayers getting screwed. |
| Posted by: DarthVader 2008-09-26 16:42 |
| #1 well, i guess one can hope |
| Posted by: Abu do you love 2008-09-26 15:36 |