You know, the more I think of this, the more I wonder:
Is the hyperinflation the point of the bailout?
Think of it. Bush and the Neocons (as well as McSame and Palinsane) have an almost sociopathic (if not actually sociopathic) disdain for the middle and lower classes. I mean, they figured they could get people to ignore the bullshit the neocons let the big finanacials/oil/corps get away with by bribing them with a fucking month's rent.
So now, continuing on: Let's say I have ten dollars, and you have 100. There's 110 dollars between us.
Now, you're in financial trouble, so you get 900 dollars. However, I am "not" (or at least, not big enough to destroy the economy), so I don't get any money. There's now 1010 dollars between us, but now your old 100 dollars is worth what my ten dollars was.
I now have the equivilent of 1 dollar, and you now have the equivilent of 90.
After inflation kicks in, you're poorer, but 90 times wealthier than I am, instead of 10.
Kitty is thinking... if there was a better way to really bust open a gap between the rich and the poor, this would be the way to do it. I honestly think that this is a feature, not a bug.
This is what they fucking want. They've shown time and time again that they want the wealthy to stay wealthy, and everyone else can go fuck themselves.
If this comes to pass, I wonder how history will see it?
A brave attempt to save the world from destruction, or a power play designed to send the world back into the Gilded Age or the financial equivilent of the Dark Ages?
September 20, 2008 at 6:39 PM
Preznitman is starting the price tag at $700 billion dollars. President Bush said Saturday that the plan matches the scope of the problem."It is a big package because it's a big problem," he told reporters at a joint news conference with Alvaro Uribe, the president of Colombia."The risk of doing nothing far outweighs the risk of the package," Bush said.Treasury Secretary Henry Paulson, lawmakers and their aides are expected to work through the weekend in an effort to craft a bill swiftly. Democratic leaders on Capitol Hill said they expect the bill to go before a vote within days. Paulson, Federal Reserve Chairman Ben Bernanke and other officials have said in recent days that the lack of easy credit between banks and other financial institutions threatens to inflict serious damage on the economy if not addressed immediately.Remember, that's just the opening bid. And once again I remind you that every step the government has taken to fix this problem has been increasingly more expensive and has failed every single time.They are still treating this as a liquidity problem. Buy the toxic waste off the books and banks will magically be solvent again? No. Look, let's call this what it is: the plan to push this crisis off for another six months onto the next President's plate.The basic problem here is that the housing depression is still going. It will go well into 2010. Mortgages will lose money. Banks are still leveraged out the ass. This plan does nothing -- not a single thing mind you -- for homeowners facing foreclosure. Even worse, this bailout will lock up the foreclosure market. Nobody's going to buy a house if the value goes down. Millions of more Americans will go underwater on their mortgages.They will walk away, broken. Imagine what $700 billion could do for homeowners in underwater mortgages. But they won't see a dime. They will lose their homes. Homes nearby will lose their value. More people will get into trouble. Homeowners already are maxed out on debt. So that $700 billion won't be nearly enough to buy these toxic debts, because more debts will go bad, more homes will go into foreclosure, banks will lose money on foreclosed properties as real estate drops and they will become increasingly more insolvent.All this bailout will do is encourage massive consolidation. You'll see megabanks buy out everything they can get their hands on in order to take more assets and force the government to take toxic debt off the books through UberBailout, for these new hyperbanks will be Too Big To Fail. AIG has shown the financial sector the way.What assets they do have they will take increasingly larger risks with. And those risks will fail as mortgages and the economy fail.It's a death spiral, and we're trapped in it. This too will fail. $700 billion will turn into trillions and trillions, until hyper-inflation kicks in and we're all screwed. And how do I know it's going to fail? The same Wall Street people who got us into this mess are going to be in charge of managing the bailout.As part of the government bailout of the financial industry, the Treasury has floated a plan with industry executives that envisions the $700 billion in bad mortgage debts being bought by the government will be run by five to ten outside asset managers, CNBC has learned. These managers will each run portfolios of up to $50 billion each, according to a source familiar with the plan. The portfolios will be amassed through so-called "reverse auctions" where the seller bids the lowest price it will accept from the government for buying up the asset.Enjoy the ride.
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Close this window Jump to comment formYou know, the more I think of this, the more I wonder:
Is the hyperinflation the point of the bailout?
Think of it. Bush and the Neocons (as well as McSame and Palinsane) have an almost sociopathic (if not actually sociopathic) disdain for the middle and lower classes. I mean, they figured they could get people to ignore the bullshit the neocons let the big finanacials/oil/corps get away with by bribing them with a fucking month's rent.
So now, continuing on: Let's say I have ten dollars, and you have 100. There's 110 dollars between us.
Now, you're in financial trouble, so you get 900 dollars. However, I am "not" (or at least, not big enough to destroy the economy), so I don't get any money. There's now 1010 dollars between us, but now your old 100 dollars is worth what my ten dollars was.
I now have the equivilent of 1 dollar, and you now have the equivilent of 90.
After inflation kicks in, you're poorer, but 90 times wealthier than I am, instead of 10.
Kitty is thinking... if there was a better way to really bust open a gap between the rich and the poor, this would be the way to do it. I honestly think that this is a feature, not a bug.
This is what they fucking want. They've shown time and time again that they want the wealthy to stay wealthy, and everyone else can go fuck themselves.
If this comes to pass, I wonder how history will see it?
A brave attempt to save the world from destruction, or a power play designed to send the world back into the Gilded Age or the financial equivilent of the Dark Ages?
September 20, 2008 at 6:39 PM