The 700 Billion Dollar Question By loteck in MLP Tue Sep 23, 2008 at 07:30:43 AM EST Tags: (all tags)
	Those who spend their weekends doing things other than watching the news woke up Monday morning to a proposed 700 billion dollar bailout of the broader US financial system. The response to the most devastating financial crisis in modern history is surely a complex web of legal and technical intricacy, tied together with thick ropes of incomprehensible financial jargon and heavy-laden with the legislative double-speak inherent to all bills, right? Nope. It's only 2 pages long, and written in near-layman's terms. You would read it, if you were paying attention. If you had read it, here's a section that might have struck you: "Section 8: Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

The blog Naked Capitalism has a rather long-winded analysis of the broadstroke implications of accepting the current bailout. A couple of talking points copypasta'd below for those with the attention spans of a retarded cat (thanks to all of you for being a big part of why we are here). "Anyway, I wanted to let you know that, behind closed doors, Paulson describes the plan differently. He explicitly says that it will buy assets at above market prices (although he still claims that they are undervalued) because the holders won't sell at market prices. Anna Eshoo pressed him on how the government can compel the holders to sell, and he basically dodged the question. I think that's because he didn't want to admit that the government would just keep offering more and more." "So unlike the Resolution Trust Corporation, which took on dodgy assets which had fallen into the FDIC's lap due to the failure of thrifts, and the Home Owners' Loan Corporation, which was established in 1934 after the housing market had bottomed, this program is going to swing into action with the clear but not honestly disclosed intent of buying assets at above market prices when future markets and the analysts with the best track records on forecasting this decline (you can add Robert Shiller, CR at Calculated Risk, and Nouriel Roubini to the list) believe it has considerably further to fall." So here's a question, what would you do if you were given $700 billion and exemption from legislative or judicial oversight, and had every active politician and every major corporation within arms reach?

Poll

With $700b, I would: Whirl Peas 12% 2 chix 44% Socialize healthcare 25% Take over the country and cement it as a shadow monarchy 22% Leave 20% Burn it and take the world down with me 24% Buy guns/gold/god 24% WIPO 6% Votes: 158 Results | Other Polls

Related Links

Nope. Naked Capitalism Also by loteck