Comments on: [WaPo Elitist Update & TV Must-Watch] Let’s Check Timmy’s “Toxic Assets” Plan

By: Krugman Pounds Away At Geithner’s Recycled Toxic Assets Plan : NO QUARTER

Krugman Pounds Away At Geithner’s Recycled Toxic Assets Plan : NO QUARTER — Wed, 25 Mar 2009 15:51:50 +0000

[...] Here’s Paul Krugman, on camera, on Geithner’s “toxic assets” plan, announced Monday: “This is something they can do without legislation. They found a way that they can in effect put the public on the hook for a TRILLION DOLLARS for this stuff without actually getting any approval.” It can be done through the FDIC and with TARP “residue.” (See our discussion of Krugman’s same-day column.) [...]

By: The Left Piles On Their Own “The One” : NO QUARTER

The Left Piles On Their Own “The One” : NO QUARTER — Tue, 24 Mar 2009 17:51:11 +0000

[...] And see my hot-potato piece on Monday, “[WaPo Elitist Update & TV Must-Watch] Let’s Check Timmy’s “Toxic Assets” Plan.” [...]

By: I'm a Linda too

I'm a Linda too — Tue, 24 Mar 2009 06:33:27 +0000

Another great post about the REALITY we have.

By: John Smith

John Smith — Tue, 24 Mar 2009 01:50:19 +0000

is the interview going to be online?

By: cynic

cynic — Mon, 23 Mar 2009 22:08:43 +0000

My understanding about AIG is that it’s essentially the same sort of problem a small bank might have, except with a different sort of toxic asset and on an enormously vaster scale. AIG has greatly over-extended itself by insuring questionable loans and financial transactions far in excess of its ability to make good on possible defaults. Nevertheless, so long as it isn’t systemically tested, that AIG insurance continues to prop up innumerable transactions that a large portion of the financial industry depends on. If the government kicks the props out from under AIG, the props collapse underneath all of those other financial institutions in a cataclysmic global chain reaction. We’d probably experience some financial equivalent of a nuclear winter while we waited in the darkness for the dust to slowly settle.

By: samb

samb — Mon, 23 Mar 2009 21:37:59 +0000

You have politicians who have taken money from AIG, but are now outraged about the bonuses that were given to the executives,You have citizens outraged at the bailout of the big three automakers but still drive SUV ‘s and my still buy one due to the the low prices and low gas prices,You have good citizen’s out raged about Obama’s stimulus spending, but were these the same people who may or may not have voted for him, They tell us save, but many have lost theIr jobs and have had cuts in pay, So then they tell us to spend and buy, but oh! a hour ago they told to save. WHATS RIGHT WHAT’S WRONG ?????

By: KmX

KmX — Mon, 23 Mar 2009 21:06:18 +0000

This is a modification of Hank Paulson pLan. In Paulson Plan if the bad assets are profitable the tax payers would benefit.

In Geitner Plan only the Investors make a profit and if there is a losss the government is left holding the bad assets.

If we are going to bail out banks, I would have prefered Paulson Plan where both tax payers and investors take a hit or a profit.

Geitner plan is bascially the govbernment subsidizing banks if the assets are worthless.

By: termo

termo — Mon, 23 Mar 2009 21:05:34 +0000

That’s the impression I got from that 60 Minutes interview and, frankly, so did Steve Kroft (asking him if he is “punch drunk”).

I get the impression from his gait that Obama bops around like “it doesn’t get better than this” stuff.

He takes every opportunity to show off his new lifestyle with his personal airforce, his body guards, and his house. Why else would Madam Obama be throwing all these taxpayer paid private concerts?

Geithner’s plan might work “if” the economy turns around, the credit market returns, and house prices start growing again. If that does not happen, the toxic assets will be the least of our problems.

By: Oisafraud

Oisafraud — Mon, 23 Mar 2009 21:05:05 +0000

***Obama is now the Toxic Assets in the economy***

By: SHV

SHV — Mon, 23 Mar 2009 21:03:11 +0000

“Surprise, surprise. That’s because our real “toxic assets” are Barack Obama, Rahm Emanuel, David Axelrod, and Timmy Geithner.”
********
Larry Summers is in the WH calling the shots to protect the investment that the bankers made in Obama. There is no way in hell that Hillary would be throwing more money down this rat hole. Big money had to knock her out in the primary, whatever it cost, and they did.

By: NoTrollZone

NoTrollZone — Mon, 23 Mar 2009 20:54:07 +0000

inflation has me aghast as well. Now not only can call the people who got fleeced in the stock market join the soup line, but all those people who were smart/lucky enough to get their money out or to always keep it in bank accounts— now these folks will watch the value of their money disappear.
Everybody’s gonna bite it, but the scum we allow to filtch it from under out noses.

By: cynic

cynic — Mon, 23 Mar 2009 20:44:06 +0000

The way I understand it, the toxic part of the asset isn't something we'd want to buy. The toxic asset isn't the house formerly worth $250K that now has a market value of $150K; the toxic asset is the difference between the $250K mortgage that the bank owns and the $150K that the house is now actually worth. If they sold the house for the $150K we might be happy to pay them, they'd be rid of the toxic mortgage but out the $100K difference. If a bank has 200 such mortgages, they've got a serious problem: assets that are toxic to the tune of $20 million. Nobody is going to loan them a nickel, and they have little money to loan out themselves. If the government just says To hell with them, they brought it on themselves, the bank folds, wiping out its innocent share holders. Then the government still has to come forward anyway, at the taxpayers' expense, to make good on all of the lost account money insured by FICA. They've got to, because failure to do so would create a nation-wide run on the banks, killing off sound and unsound banks alike.

By: meileen

meileen — Mon, 23 Mar 2009 20:40:00 +0000

You beat me to the punch on this one. I was just about to post a link here in comments. Can’t wait till John Q gets wind of this news.

By: Masha

Masha — Mon, 23 Mar 2009 20:35:50 +0000

Of course it’s Geithner’s plan! What does Obama know about economics? The guy is just an actor, he reads a script. Right now he’s sort of busy playing a goofy president on TV.

By: I'mFedUp

I'mFedUp — Mon, 23 Mar 2009 20:30:29 +0000

All that means is that Soros and those who own 0Zero, and America, have bought like crazy and manipulated the market like they did in the reverse, in September, when McCain was ahead in the race. This is all for show, and manipulation IMO. 0Zero is sinking in the public eye but fast, so they had to do something. It’s not going to stay this way and eventually 0Zero will put us in the depression he yaks about.