Why isn't the $700 billion bailout considered a loan?

[Eeezee]

If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

 

[SagaLore]

How can they pay back a loan if they're incapable of even lending loans.

 

[jman19]

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "reduced" price for the gov't.

 

[Eeezee]

If we're expecting these institutions to never be profitable again, then why are we bothering to bail them out?

The point of the bailout is to help these companies get back on their feet. Okay, why aren't we demanding some sort of payback down the line?

 

[Eeezee]

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "reduced" price for the gov't.

Yes, so why aren't we going to require that the companies repurchase these worthless assets at a slightly higher price after xx months/years at a slow rate?

Is that not a form of a loan? "Fine, I'll buy all of this shit from you, but you'd better buy it back later"

 

[jman19]

Originally posted by: Eeezee

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "reduced" price for the gov't.

Yes, so why aren't we going to require that the companies repurchase these worthless assets at a slightly higher price after xx months/years at a slow rate?

Is that not a form of a loan? "Fine, I'll buy all of this shit from you, but you'd better buy it back later"

Um, if they're still worthless at that time then the banks will just have this problem again in the future.

And if they go up in value, why would the gov't want to dump then and lose money on them?

 

[daniel49]

may not be a totally bad idea.
AIG bailout was a loan and the Govt will be collecting 12% interest on it.

 

[jman19]

Originally posted by: daniel49
may not be a totally bad idea.
AIG bailout was a loan and the Govt will be collecting 12% interest on it.

The AIG bailout was definitely a bit better I think - collecting a big fat interest rate is nice :thumbsup:

I think rather than start giving out loans right before these banks fail, the gov't is trying to stem the problem NOW - the only problem with that is that they are buying crap with tax payer money. Hopefully they are right, and that these assets will end up being a good investment at the price they're being purchased at.

 

[Eeezee]

Originally posted by: jman19

Originally posted by: Eeezee

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "reduced" price for the gov't.

Yes, so why aren't we going to require that the companies repurchase these worthless assets at a slightly higher price after xx months/years at a slow rate?

Is that not a form of a loan? "Fine, I'll buy all of this shit from you, but you'd better buy it back later"

Um, if they're still worthless at that time then the banks will just have this problem again in the future.

And if they go up in value, why would the gov't want to dump then and lose money on them?

No, basically the idea is to have the banks buy back these assets at a slow rate. The bailout will help them right now. When the banks are in better financial standing, they can buy back *some* of the assets, a little at a time. Eventually they'll own all of these worthless assets. I'm suggesting that the banks be required to pick up these assets as they become better equipped to deal with the losses.

If they go up in value (they probably won't) then the government can simply hold onto them. Otherwise, why don't we force these businesses to at least make a reasonable offer to purchase some of these assets every xx months?

What's wrong with wanting the banks to keep some responsibility? They shouldn't be given free handouts just because they're facing a rough financial situation. Let's just give them a nice loan to keep them out of collapse.

 

[jman19]

Originally posted by: Eeezee

Originally posted by: jman19

Originally posted by: Eeezee

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "reduced" price for the gov't.

Yes, so why aren't we going to require that the companies repurchase these worthless assets at a slightly higher price after xx months/years at a slow rate?

Is that not a form of a loan? "Fine, I'll buy all of this shit from you, but you'd better buy it back later"

Um, if they're still worthless at that time then the banks will just have this problem again in the future.

And if they go up in value, why would the gov't want to dump then and lose money on them?

No, basically the idea is to have the banks buy back these assets at a slow rate. The bailout will help them right now. When the banks are in better financial standing, they can buy back *some* of the assets, a little at a time. Eventually they'll own all of these worthless assets. I'm suggesting that the banks be required to pick up these assets as they become better equipped to deal with the losses.

If they go up in value (they probably won't) then the government can simply hold onto them. Otherwise, why don't we force these businesses to at least make a reasonable offer to purchase some of these assets every xx months?

What's wrong with wanting the banks to keep some responsibility? They shouldn't be given free handouts just because they're facing a rough financial situation. Let's just give them a nice loan to keep them out of collapse.

I think the gov't believes they need to restore confidence in the banking system to keep the economy from trending downwards. I suspect the markets wouldn't respond as positively to this news. Not sure how the market would take this, especially with the clearly evidenced panicking and short selling.

As for responsibility, the banks absolutely do need to be responsible, and I suspect it will come in the form of additional regulation and, possibly, reduced compensation rules.

 

[Budmantom]

ACORN doesn't take loans.....

 

[Firebot]

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

 

[Vic]

Originally posted by: Budmantom
ACORN doesn't take loans.....

It never ceases to amaze me how utterly ignorant and brainwashed you are regarding all the issues.

 

[smack Down]

Because then palson wouldn't be able to give 700 billion dollars to his buddies on wallstreet.

If it doesn't screw the tax payer then it doesn't help him enough.

 

[jman19]

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

Do you know why I put quotes around that? I'm guessing not by your smartass and lame reply.

The gov't is selling this to the people as keeping the economy healthy and an investment for the future.

 

[Firebot]

Originally posted by: jman19

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

Do you know why I put quotes around that? I'm guessing not by your smartass and lame reply.

The gov't is selling this to the people as keeping the economy healthy and an investment for the future.

It wasn't a smartass response. People on here actually seriously believe that this will somehow benefit taxpayers and there's going to be a fire sale. Quotation marks aren't known as "sarcasm" marks (heck I just showed a way they can be used), you may want to be clearer on what you actually want to say.

 

[jman19]

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

Do you know why I put quotes around that? I'm guessing not by your smartass and lame reply.

The gov't is selling this to the people as keeping the economy healthy and an investment for the future.

It wasn't a smartass response. People on here actually seriously believe that this will somehow benefit taxpayers and there's going to be a fire sale. Quotation marks aren't known as "sarcasm" marks (heck I just showed a way they can be used), you may want to be clearer on what you actually want to say.

For a while this was being sold as buying the assets on the cheap, which is why I used those quotes - however, as most ppl know, those assets probably aren't even priced correctly anyway.

 

[LegendKiller]

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

Do you know why I put quotes around that? I'm guessing not by your smartass and lame reply.

The gov't is selling this to the people as keeping the economy healthy and an investment for the future.

It wasn't a smartass response. People on here actually seriously believe that this will somehow benefit taxpayers and there's going to be a fire sale. Quotation marks aren't known as "sarcasm" marks (heck I just showed a way they can be used), you may want to be clearer on what you actually want to say.

They will not sell them at par, they will most likely sell at discount.


This shouldn't be a loan, we are already doing that. This is structured fine.

 

[smack Down]

Originally posted by: LegendKiller

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

Do you know why I put quotes around that? I'm guessing not by your smartass and lame reply.

The gov't is selling this to the people as keeping the economy healthy and an investment for the future.

It wasn't a smartass response. People on here actually seriously believe that this will somehow benefit taxpayers and there's going to be a fire sale. Quotation marks aren't known as "sarcasm" marks (heck I just showed a way they can be used), you may want to be clearer on what you actually want to say.

They will not sell them at par, they will most likely sell at discount.


This shouldn't be a loan, we are already doing that. This is structured fine.

Fine for who? Yes the structured fine if the goal is to screw the tax payers. Hey look that is your goal.

 

[tcsenter]

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest. Why are we giving these companies money and never expected it back?

Because whenever it has been a loan, its still (inaccurately) called a bail-out by the media and otherwise uninformed masses. e.g. the government "bail-out" of Chrysler was in fact a loan which was paid back in full plus an estimated $300 million in interest, but nevertheless ubiquitously referred to as a 'bail-out'.

If you don't understand the difference, the media is certainly never going to point it out for you. That's something you'll need to educate yourself about and draw your own conclusions.

 

[Viditor]

Originally posted by: Firebot

Originally posted by: jman19

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest.

Why are we giving these companies money and never expected it back?

Because it's not a loan, it's asset disposition for the companies at a "premium" price for the gov't.

Fixed. This isn't a fire sale, the treasury chairman has explicitly said they will pay a premium, even as much as a hold to maturity premium, to ensure that the banks aren't losing money, and to keep housing markets artificially inflated.

That has been modified...you are speaking of the original plan, not the currently popular one.

 

[Eeezee]

Originally posted by: tcsenter

Originally posted by: Eeezee
If we're going to bail out these companies, why don't we ask them to pay that money back? Shit, charge them interest. Why are we giving these companies money and never expected it back?

Because whenever it has been a loan, its still (inaccurately) called a bail-out by the media and otherwise uninformed masses. e.g. the government "bail-out" of Chrysler was in fact a loan which was paid back in full plus an estimated $300 million in interest, but nevertheless ubiquitously referred to as a 'bail-out'.

If you don't understand the difference, the media is certainly never going to point it out for you. That's something you'll need to educate yourself about and draw your own conclusions.

I'm not suggesting that it's a loan now - it's not

I'm suggesting that we turn it into one!