The Smashing Pumpkin’s "Rat in a Cage" lyrics seem to apply to us citizen’s, especially after the ‘bailout'(screw the words ‘rescue plan’) legislation was passed.
—interview with Robert Johnson, the former chief economist of the Senate Banking Committee. The interview makes the following statements:
"I do also want to underscore that I believe it was Secretary Paulson who
made the call to let Lehman Brothers go bankrupt, that led to the very, very violent restructuring of AIG with taxpayers’ money, which led to the crisis that led to this bailout bill."
which leads to this story:
Lehman Creditors Allege JP Morgan Role in Bank’s Failure
"Oh, this could get ugly. The Wall Street Journal reports that Lehman’s
unsecured creditors are calling on the bankruptcy court to examine why the
investment bank ran out of funds. The suit argues that JP Morgan abused
its role as clearing bank, retaining $17 billion of excess collateral which Lehman could have used to stave off its collapse."
More from the interview:"They can, what I would say, use the crisis anxiety of the market fragileness to, how would I say, accomplish their aims on behalf of money and do no service for the public. We have no mortgage relief in this bill whatsoever."
"on the Senate side, somebody snuck that in on page 61 of the bill."
"There was a provision, that made it more difficult to get mortgage relief than under existing law, put in that bill at that time."
The bill can be read here:
And "this is about a bipartisan money machine working against the
population. They’re daring you. They’re daring you to turn out in five weeks and, in essence, support challengers against incumbents, because the incumbents are the ones responsible for doing this bill."
"No one will know if this works for several years,” said Stuart Eizenstat, former deputy secretary of the Treasury and now a partner at Covington & Burling, a Washington-based law firm. “This is very much his plan; it will bear his name and his imprint for generations to come.”
"Banks won’t be allowed to sell assets to the Treasury for more than what
they paid, unless they purchased the assets from another bank already in
bankruptcy or conservatorship.
I wrote to the authors of the above article asking them to correct the story because of Section 101(e) and so far no response or correction.
""(e) PREVENTING UNJUST ENRICHMENT.—This subsection does not apply to troubled assets acquired IN A MERGER OR ACQUISTION, or a purchase
of assets from a financial institution in conservatorship or receivership, or that has initiated bankruptcy proceedings under title 11, United States Code."
So JPMorgan, BofA, Citi, Goldman, and Barclay’s and foreign banks CAN
sell assets to the Treasury for more than they paid for them.
An ex-Senator -A CONSERVATIVE- tells it like it is:
"Another smart thing you learn is how to low-ball the deficit by subtracting the trust funds. For example, the White House projected a FY 2008 deficit of $425 billion. The actual deficit is $1074 billion. The President and Congress constantly use Social Security surpluses to report a lower deficit. Section 13-301 of the Budget Act forbids this. But the President and Congress violate the law to appear fiscally responsible. Then they report Social Security is in trouble. Social Security reports a surplus of $2.4 trillion and is not in trouble."
To Big to Fail ? Think Bank of America and the bailout
MBIA Cries Fraud; Sues Countrywide
and then think of Section 101(e) of the bailout legislation.
"Rescue bill won’t curb Sacramento,CA foreclosures, experts say"
Know where the Dow and S&P 500 were EIGHT years ago? 11,388 and
Today after the bailout? Dow=10,324, S&P 500=1099
Add in inflation, dollar de-valuation and it’s worse than the numbers show.
What’s Responsible for the TED Spread’s Recent Behavior?
A history of Fannie and Freddie and the same ‘players’ who pushed the
And in the bill there are allowances for Paulson to hire anyone he wants -on a so called ‘interim basis’- to execute his ideas without Congressional hearings for those appointees and no penalties for such people if later on they are found to not have acted in the interests of ‘taxpayers’
"The "Bailout Plan" was passed. Will it work? The answer depends on what
your definition of "work" is."
"despite all my rage I am still just a rat in a cage"