The actions are “not what we ever wanted to do”, Mr Paulson conceded, “but today, there is a lack of confidence in our financial system ”“ a lack of confidence that must be conquered because it poses an enormous threat to our economy.”
In recent weeks, governments around the world have had to respond to the financial crisis with extraordinary measures and dizzying speed. The financial system came close to calamity in the days after the Bush administration, arguing that markets should be allowed to work difficulties through without government help, let the investment bank Lehman Brothers fail last month. Before a week was out, however, the US government had to take over the world’s largest insurance giant, AIG, and promise to guarantee all the money in the $3 trillion money market industry. Last month, it became the country’s largest mortgage lender when it took over the tottering mortgage finance giants Fannie Mae and Freddie Mac in a rescue bid that could cost taxpayers $200bn.
Almost without any thought, the actions usher in a new and unpredictable era in American capitalism.
“It wasn’t just the right move, it was the only move,” Ken Rogoff, Harvard University economist, said of yesterday’s cash injection. “Thank goodness they didn’t dally for another week to finally figure it out.”
I had thought that the plan was to require the banks receiving this 250 billion to start lending again, but when it was put in force there was no requirement, only the statement that they hope it will encourage these banks to lend. There’s another 250 billion down the drain. It’s Christmas every day on Wall Street. Fight back. Vote against your Representatives (House and Senate) next month if they voted for the 700 billion bailout plan that’s making this theft of public monies and power grab possible.
Well humiliate me! Shower me with billions of dollars! No really I know some may laugh at me and that some may even deride me, but I CAN HANDLE IT!
Now hand over the money. Are you sure it comes with no strings? I surely thought that the government would want some controls, but hey if you want to shovel a few billion dollars into my pockets I’m cool with that.
RSB
Seriously…how much would it cost for us just to pay off every single mortgage out there? Why run the money through all the hooks of the middlemen? Let’s just pay off every mortgage and be done with it. That way, at least the tax payers are getting a real benefit from their own money rather than just this socialism for the rich.
I am furious!