Best analysis of PPIP I've read yet

[alchemize]

Public-Private Investment Program for Dummies: How does the new Treasury Plan Impact Housing and the Market? Poorly Planned Investment Program (PPIP).

Cliffs:
- This is a handout to big banks/investors. You have to be a big bank/investor to even participate
- The loans are non-recourse (lose your money? No problem, write it off and we'll dish it on the taxpayers).
- 90+% of the funding comes from the taxpayer in the form of new debt.

 

[StageLeft]

I figured it was a handout for big banks which is why I was so eager to put in a few bucks into Citigroup. I figure if they're going to fleece the country again I might as well try and be a part of the upswing.

 

[zephyrprime]

God this is disgusting. Geithner just keeps putting more lipstick on a pig until it becomes passable legislation. The plan is basically the same (overpay for toxic assets) but it needs to get convoluted enough to confuse congress so that they will not balk at the fact that it's a huge giveaway to the very people the created this mess.

 

[alchemize]

Bump, I know this isn't as exciting as OTC Plan B, but should be required reading

 

[alchemize]

Economist Joseph Stiglitz: "Robbery of the American People"

 

[Craig234]

Quite frankly, this amounts to robbery of the American people.
Joseph Stiglitz

I'm concerned about that.

I don't have the expertise to sort through the financial policy, but I do understand the political clout of the financial industry, and have long predicted this sort of effort. While I'm far more confident of the American people being represented by Obama and Democrats in Congress, I'm still not that confident of their resisting that industry.

There are certain members I'm confident resist them - and I look to them for comments on the plans - but whether they can get a majority (and Obama) on the right side... One of those leaders I trust is Sen. Bernie Sanders. Here is his commentary back in September on what to do.

Recently, Sanders is blocking an Obama appintee who has a terrible background in Goldman Sachs (who I've criticized for years) and the CDS deregulation:

U.S. Senator Bernie Sanders said he is blocking a Senate vote on the nomination of Gary Gensler to be chairman of the Commodity Futures Trading Commission because of Gensler?s past support for deregulation.Sanders, a Vermont independent, said today in an e-mailed statement that Gensler had worked to deregulate electronic energy trading and exempt from regulation credit default swaps, which Sanders blamed for the downfall of American International Group Inc.

?At this moment in our history, we need an independent leader who will help create a new culture in the financial marketplace and move us away from the greed, recklessness and illegal behavior which has caused so much harm to our economy,? Sanders said.

 

[alchemize]

Here we go, let the raping of the taxpayer commence:

It Looks Like Citi And Bank Of America Are Already Gaming The System

 

[cubeless]

pretty funny article... buy up more 'toxic' assets so you have more to sell at the inflated price the the new plan will afford... brilliant...

so, if, as stated in a jon markham article over on msn, the auctions of this stuff don't go like gangbusters it means the whole mess is going to collapse... and that it seems that blackrock will be the ones deciding what the prices paid are going to be 'because they have the best mathmatical model'...

so my question would be why not just add blackrock's model to the 'stress test' and then (most likely) start shutting the banks all down?

 

[Lemon law]

What I fail to see here is any real evidence that the new Geithner plan is any different than the Hank the Crank Paulson panic plan. At the time of Hank the Crank, there were many excuses about no one really knew the depths of the problem, what the toxic assets really worth, and here we are now six months later, and no one seems to know anything more. But its seems to me, its the natural tendency of investors to try to game the system, we should all realize those jerks do not create value, so its (1) Absurd to think we should compensate them for be a net drain on the system. (2) And its an absolute no brainer as we gain better knowledge, that any entity like Citi and Bank of America who tried to game the system should be rewarded with a end results no profits for the wages of their sins. At best, break even is justice. Something that Geithner has the power to make sure happens and Geithner can gain brownie points by later donning the bully pulpit, naming names, and explaining why he made sure they did not profit.

But the real mystery to me is finding out what can be bailed out and what should be thrown away as a bridge too far. IMHO, the mortgages are merely paper losses at present, they can be bailed out, but the credit default swap contract casino bets should all be declared as null and void. If nothing else, there is not enough money in the universe to bail them out all those pie in the sky bets, contracts between a fool and a fool, and its a fools game for any government to try to bail credit default swaps out.

 

[cubeless]

ewwww... i pretty much agree with lemmy...

what's scary is that timmy yesterday wouldn't even touch the idea that cds's should be treated as insurance, and handled as such (i can't get a life insurance policy on lemmy and then hope he kicks, i have to be a 'counterparty with interest') instead of how it's a big casino now... they only want at most to have a central clearing house which will be easily played by the bad guys...

and the whining that folks in other countries will get all teh business if we have some rules on american companies is bullshit... if no american registered company does evil then they will be well positioned to fling moral doo doo at folks doing evil stuff... and maybe it won't be our financial system that starts the collapse next time...