http://thepeoplescube.com/red/viewtopic.php?t=2504

It seems that Wall Street genius and multi-millionaire, Treasury Secretary Henry Paulson, is admitting that the US Treasury will be following my and other people’s advice and not buying “troubled assets” and instead will be making loans to banks that need a temporary infusion of capital.

Bailout Bill vs. Rescue Economy American People (REAP) Law

Congratulations goes to Paulson for admitting he is human and makes mistakes.

Treasury Secretary Paulson’s news conference

11/12#3 Yoo Paulsen did you mislead Congress?

Pt 1 CNBC Panel Discusses Paulson’s Press Conf 11-12-08

Pt 2 – CNBC Panel Discussion Paulson Press Conf 11-12-08

Unfortunately by admitting that the United States was responsible for the creation of the subprime loan financial crisis, he is creating another problem.

This gives foreign governments such as the Peoples Republic of China, justification for asking for their money back. I suspect that this was one of the primary reason behind the bailout bill:

The Sovereign Wealth Fund Threat: Are Chinese Communists Behind Rush In Passing Bailout Bill?

URGENT* BAILOUT BILL SELLS US TO CHINA (UPDATED)

I believe the American people have been mislead, lied to and not told the real reason behind the urgency of getting the bailout bill pass last month.  The game plan all along was to be able to buy back the “troubled assets” held by foreign governments that are also major holders of US government securitites. The original plan did not make sense to hundreds of economists and financial advisors including me.

Nations, most likely China among serveral others told the US government to either make them whole or they would stop buying and holding US Treasury bills and notes.
 

The Federal government should not be bailing out any business or government entities such as states or cities and never foreign nations and their financial institutions.

In doing so they taking money from other people and businesses that earn income and create wealth and giving it to businesses and government entities that have mismanaged their affairs and are losing money and destroying wealth.

This can occur directly by taxes on businesses or individuals or indirectly by printing money or issueing government debt to finance the bailout.

The latter eventually results in inflation or a general rise in prices.

This depreciates the value of money.

If any auto company is in financial trouble and cannot raise any additional equity capital or loans from banks, it should either seek a buyer for some or all of its assets or file for bankruptcy.

If union members in the auto industry want their jobs they should agree to drastic cuts in both wages, benefits and retirement and pension plans.

Sooner or latter, General Motors, Chrysler, and may be even Ford, will have no alternative but to go into bankruptcy.

One of the first things that will have to happen is the companies will seek to void all union labor contracts and retirees will lose most if not all of their pensions. The price of mismanagement and greed by executives and the leaders of the UAW will finally be paid. The day of reckoning is fast approaching.

Do not expect any sympathy from the American people:

“…Sizable pluralities of Americans are opposed to taxpayer-backed bailouts of the Big Three automakers, with 73% now worried the U.S. government will run out of money with all the demands being made on the federal treasury in the current economic crisis.

Forty-one percent (41%) of adult Americans are Very worried the government will run out of money, according to a new Rasmussen Reports national telephone survey. Only six percent (6%) are not worried at all.

Women are slightly more worried than men, Republicans more than Democrats, whites more than blacks, and younger Americans more than older ones. …”

http://www.rasmussenreports.com/public_content/business/general_business/73_fear_u_s_will_run_out_of_money_if_more_are_bailed_out

The executives and union leaders would ran the auto industry only brought it upon themselves.

The federal government should never bailout any business no matter how big.

Businesses are free to succeed or fail.

Once the government starts bailing out businesses then other businesses in financial trouble just line up and ask for a bailout.

Government intervention in the economy with bailouts to those “too big to fail”, results in a misallocation of scarce resources including capital and labor to business that have mismanaged their business and away from companies that have been successful in creating wealth and jobs.

Those companies that are too big is the problem and bailouts are not the solution.

Troubled companies should try to downsize or fail.

Bailouts are using the law to plunder the American people’s assets.

I call it a stickup and stealing no matter how slick it is done.

Remember it was government intervention in the real estate mortage markets that is the root cause of the problem that resulted in the real estate bubble and current financial crisis.

More government intervention in the economy is only making the problem worse.

Government intervention in banning oil and gas exploration off the US coasts and ANWR impacted the supply of oil and eventually the price of gasoline went up.

The Federal government should stop trying to regulate the supply and demand of energy and deciding what type of vehicles the consumer should purchase.

The consumer should be sovereign as to the goods and services it wants to purchase.

Neither Congress nor the President should interfer with the American’s people freedom of choice.

Every time the federal government intervenes in the economy  the result is government failure resulting in economic recession if not depression.

Government intervention leads to more and more government intervention.

When will American elites learn that socialism is a failure and leads to more and more government coercion?

Just leave us alone and mind your own business.

Ban Bailouts and Stop Inflation Now!

Fox: Shep Smith on auto bailout: It’s not capitalism.

11-10-08 Ron Paul on Fox Business with Neil Cavuto discussing bailout

KILLBILL – TARP Same bailout plan with lipstick on it – Defazio

Newt with Greta on fixing the economy without a bailout

Lou Dobbs – Henry Paulson All Talk No Action!

The Bailout is for China?!?!

LOL

Bailout Blues

Government BAILOUT…

Let Economy fail…

Let Wall Street Burn…

CRISIS SUBPIME-THE LAST LAUGH- John Bird and John Fortune

Background Artilcles and Videos

Banks HOARDING TAXPAYER’s $$ NOT HELP HOMEOWNERS! Kashkari

First Look: Troubled Asset Relief Program (TARP)

Kudlow – TARP

“We’re Bailing Foreign Banks, Too, With Your $700 Billion”

“We’re Bailing Foreign Banks, Too, With Your $700 Billion”

Silly Money: Where did all the money go? (1 of 5)

Silly Money: Where did all the money go? (2 of 5)

Silly Money: Where did all the money go? (3 of 5)

Silly Money: Where did all the money go? (4 of 5)

Silly Money: Where did all the money go? (5 of 5)

Obama asks Bush to bail out Detroit now

Rick Moran
“…In their meeting yesterday, Barack Obama asked President Bush to allow the auto industry to tap into the $700 billion kitty passed by Congress to bail out the financial industry.

Hank Paulson Naked Emperor

By Michelle Malkin

“….Treasury Secretary Hank Paulson finally confirmed what lonely bailout opponents tried to tell the American public all along: The man doesn’t know what the hell he’s doing.

Paulson held a bazooka to taxpayers’ heads. He groveled on his knees in front of Democratic House Speaker Nancy Pelosi. He lured leaders from both political parties into linking arms in a panicked Chicken Little line dance for the beleaguered mortgage industry. Paulson demanded an unprecedented $700 billion troubled assets relief program for the good of the country. For the health of the housing market. For the survival of the economy. No time for deliberation. No time to review the failures of such interventionist approaches around the world. Now, now, now!

And now? The pulled-out-of-the-posterior “$700 billion” price tag has ballooned into the trillions. The “mortgage industry rescue” has expanded to banks, insurance companies, automakers, credit card companies, and possibly the entire national volume of consumer lending. Oh, and that vaunted “TARP” component, Paulson admitted this week, is nothing but a four-letter-word that rhymes with TRAP.

In September, Paulson offered his lofty pledge: “The ultimate taxpayer protection will be the stability this troubled asset relief program provides to our financial system, even as it will involve a significant investment of taxpayer dollars. I am convinced that this bold approach will cost American families far less than the alternative – a continuing series of financial institution failures and frozen credit markets unable to fund economic expansion.” Two months later, Paulson’s conviction melted faster than microwaved butter. “Our assessment at this time is that this is not the most effective way to use TARP funds,” he sheepishly told the nation Wednesday.

Hey, who died and put Emily “Never mind” Litella in charge of the economy? …”

Senators to Paulson: You lied, TARP died

By Michelle Malkin 

“…Three GOP Senators have sent Treasury Secretary Hank “Never mind” Paulson a “joint letter of concern.” I’ll have more on this abominable subject in my syndicated column tomorrow.

Joint Letter of Concern to Secretary Paulson After His Announcement to the Change Intent of the Troubled Asset Relief Program

November 13, 2008

Dear Secretary Paulson:

We are writing to express our deep concern over your announcement this morning that the Department of the Treasury will halt all plans to purchase trouble mortgage assets through the Troubled Asset Relief Program (TARP). We are concerned that the program has been fundamentally changed from its original intent and worry that continued changes may erode the structures of accountability put in to protect taxpayers.

When legislation authorizing the TARP was first proposed to members of Congress in mid-September, its primary component was a program to allow the Secretary of the Treasury to purchase “toxic” mortgage assets from financial institutions. The primary reason for this course of action, we were told, was to assist the market in discovering the price of these assets and to return liquidity to the financial markets.

At a hearing of the Senate Banking Committee on September 23, 2008, you made the following comments on the urgent necessity of a troubled asset purchase program:

We have proposed a program to remove troubled assets from the system. This troubled asset relief program has to be properly designed for immediate implementation and be sufficiently large to have maximum impact and restore market confidence. It must also protect the taxpayer to the maximum extent possible, and include provisions that ensure transparency and oversight while also ensuring the program can be implemented quickly and run effectively.

This troubled asset purchase program on its own is the single most effective thing we can do to help homeowners, the American people and stimulate our economy.

Although the legislation was passed on October 3, the program was never implemented and now has been officially abandoned in favor of alternative plans after little more than a month. Such a rapid reversal raises questions about the TARP’s original design as well as the propriety of future plans.

Congress never intended for the TARP to be a blank check that could be spent with unlimited discretion. To ensure proper boundaries are in place to protect the taxpayer, we hope and expect that congressional approval will be sought by the administration before further changes are made.

Sincerely,

U.S. Senator Tom Coburn, M.D., U.S. Senator Richard Burr, U.S. Senator David Vitter

Behold: An “auto czar”

By Michelle Malkin  

“The Master and Overlord Obama is ready to appoint an Auto Czar.

And the lame-duck George Bush is going along.

God save us from bipartisanship. …”

http://michellemalkin.com/2008/11/12/behold-an-auto-czar/ 

Bolshevik

“The Bolsheviks, originally also^[1] Bolshevists^[2] (Russian: Большевик, Большевист (singular) Russian pronunciation: [bəlʲʂɨˈvʲik], derived from bolshe, “more”) were a faction of the Marxist Russian Social Democratic Labour Party (RSDLP) which split apart from the Menshevik faction^[3] at the Second Party Congress in 1903 and ultimately became the Communist Party of the Soviet Union.^[4] The Bolsheviks seized power in Russia during the October Revolution phase of the Russian Revolution of 1917, and founded the Soviet Union.

Bolsheviks (or “the Majority”) were an organization of professional revolutionaries under a strict internal hierarchy governed by the principle of democratic centralism and quasi-military discipline, who considered themselves as a vanguard of the revolutionary proletariat. Their beliefs and practices were often referred to as Bolshevism.^[5] The party was founded by Vladimir Lenin, who also led it in the October Revolution. …”

http://en.wikipedia.org/wiki/Bolshevik

Bankruptcy in the United States

“…The United States Constitution (Article 1, Section 8, Clause 4) authorizes Congress to enact “uniform Laws on the subject of Bankruptcies throughout the United States.” Congress has exercised this authority several times since 1801, most recently by adopting the Bankruptcy Reform Act of 1978, codified in Title 11 of the United States Code, commonly referred to as the Bankruptcy Code. The Bankruptcy Code has been amended several times since 1978, most recently in 2005 through the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 or BAPCPA. Some law relevant to bankruptcy is found in other parts of the United States Code. For example, bankruptcy crimes are found in Title 18 of the United States Code (Crimes), tax implications of bankruptcy are found in Title 26 of the United States Code (Internal Revenue Code), and the creation and jurisdiction of bankruptcy courts are found in Title 28 of the United States Code (Judiciary and Judicial procedure).

While bankruptcy cases are always filed in United States Bankruptcy Court (units of the United States District Courts) and federal law governs procedure in bankruptcy cases, state laws are often applied when determining property rights. For example, law governing the validity of liens or rules protecting certain property from creditors (known as exemptions), derive from state law. State law therefore plays a major role in many bankruptcy cases and it is often unwise to generalize some bankruptcy issues across state lines. …”

“…Largest Bankruptcy

The largest bankruptcy in U.S. history occurred on September 15, 2008, when Lehman Brothers Holdings Inc. filed for Chapter 11 protection with more than $639,000,000,000 in assets^[40], greater the next 15 largest bankruptcies put together.

The next 15 largest corporate bankruptcies are as follows^[41]:

http://en.wikipedia.org/wiki/Bankruptcy_in_the_United_States

Troubled Assets Relief Program

The authority of the United States Department of the Treasury to establish and manage a Troubled Assets Relief Program (TARP) managed by a newly created Office of Financial Stability became law October 3, 2008, the result of an initial proposal that ultimately was passed by Congress as H.R. 1424, enacting the Emergency Economic Stabilization Act of 2008 and several other acts.^[1][2] The law which created the fund authorized the Treasury to draw up to $250 billion for immediate use, then requires the President to certify that an additional $100 billion in funds are needed; a final $350 billion are subject to Congressional approval.^[3] As of November 12, 2008, $290 billion of the first $350 billion allotment funding TARP has been allocated: $250 billion for bank equity infusions, and $40 billion for an equity infusion into insurer American International Group.^{[4] …”}

^{http://en.wikipedia.org/wiki/United_States_Emergency_Economic_Stabilization_fund}

Consumer sovereignty

In unrestricted markets, those with income or wealth are able to use their purchasing power to motivate producers as what to produce (and how much). Customers do not necessarily have to buy and, if dissatisfied, can take their business elsewhere, while the profit-seeking sellers find that they can make the greatest profit by trying to provide the best possible products for the price (or the lowest possible price for a given product). In the language of cliché, “he who pays the piper calls the tune.”

To most neoclassical economists, complete consumer sovereignty is an ideal rather than a reality because of the existence — or even the ubiquity — of market failure. Some economists of the Chicago school and the Austrian school see consumer sovereignty as a reality in a free market economy without interference from government or other non-market institutions, or anti-market institutions such as monopolies or cartels. That is, alleged market failures are seen as being a result of non-market forces.

 http://en.wikipedia.org/wiki/Consumer_sovereignty

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Ban Bailouts–Stop Inflation Now (SIN)–Stop Socialism of Losses!

The Sovereign Wealth Fund Threat: Are Chinese Communists Behind Rush In Passing Bailout Bill?

Defeat the Cram Down Bullshit Bailout Bill: Emergency Economic Stabilization Act of 2008

Bailout Bill vs. Rescue Economy American People (REAP) Law

The American People Want A Full Meal Buffett Deal–Not A Bailout!

Stop The Bailout: The American Elites’ Bum Rush of The American People–No Sale!

Obama Bombs Bailout Meeting–Whitehouse Still Standing–McCain Saved By House Republicans

Obama–ACORN–CRA–Congress–Democratic Party–Fannie Mae–Freddie Mac–Bailout–Socialism– Just Say No!

ACORN–Association of Community Organizations for Reform Now–Obama’s Red Shirts 

Thomas Sowell and Conflict of Visions–Videos

Unconstrained Obama vs. Constrained McCain: A Conflict of Visions