From Pelosi’s office:
Office of Speaker Nancy Pelosi — Sept. 28, 2008
REINVEST, REIMBURSE, REFORM
IMPROVING THE FINANCIAL RESCUE LEGISLATION
Significant bipartisan work has built consensus around dramatic improvements to the original Bush-Paulson plan to stabilize American financial markets — including cutting in half the Administration’s initial request for $700 billion and requiring Congressional review for any future commitment of taxpayers’ funds. If the government loses money, the financial industry will pay back the taxpayers.
3 Phases of a Financial Rescue with Strong Taxpayer Protections
* Reinvest in the troubled financial markets … to stabilize our economy and insulate Main Street from Wall Street
* Reimburse the taxpayer … through ownership of shares and appreciation in the value of purchased assets
* Reform business-as-usual on Wall Street … strong Congressional oversight and no golden parachutes
CRITICAL IMPROVEMENTS TO THE RESCUE PLAN
Democrats have insisted from day one on substantial changes to make the Bush-Paulson plan acceptable — protecting American taxpayers and Main Street — and these elements will be included in the legislation
Protection for taxpayers, ensuring THEY share IN ANY profits
* Cuts the payment of $700 billion in half and conditions future payments on Congressional review
* Gives taxpayers an ownership stake and profit-making opportunities with participating companies
* Puts taxpayers first in line to recover assets if participating company fails
* Guarantees taxpayers are repaid in full — if other protections have not actually produced a profit
* Allows the government to purchase troubled assets from pension plans, local governments, and small banks that serve low- and middle-income families
Limits on excessive compensation for CEOs and executives
New restrictions on CEO and executive compensation for participating companies:
* No multi-million dollar golden parachutes
* Limits CEO compensation that encourages unnecessary risk-taking
* Recovers bonuses paid based on promised gains that later turn out to be false or inaccurate
Strong independent oversight and transparency
Four separate independent oversight entities or processes to protect the taxpayer
* A strong oversight board appointed by bipartisan leaders of Congress
* A GAO presence at Treasury to oversee the program and conduct audits to ensure strong internal controls, and to prevent waste, fraud, and abuse
* An independent Inspector General to monitor the Treasury Secretary’s decisions
* Transparency — requiring posting of transactions online — to help jumpstart private sector demand
Meaningful judicial review of the Treasury Secretary’s actions
Help to prevent home foreclosures crippling the American economy
* The government can use its power as the owner of mortgages and mortgage backed securities to facilitate loan modifications (such as, reduced principal or interest rate, lengthened time to pay back the mortgage) to help reduce the 2 million projected foreclosures in the next year
* Extends provision (passed earlier in this Congress) to stop tax liability on mortgage foreclosures
* Helps save small businesses that need credit by aiding small community banks hurt by the mortgage crisis–allowing these banks to deduct losses from investments in Fannie Mae and Freddie Mac stocks
According to the WSJ, House Minority Whip Roy Blunt’s office is saying that the first injection will be $250 billion, available “immediately,” with another $100 billion “upon report to Congress,” and $350 billion “only upon Congressional action.”
Fucking douches. Oversight my balls into your mouth.
@1
They should just cancel this bailout
CNBC reporting that C is seeking fed backstop for its potential purchase of WB. If not WB goes to zero.
Who thinks the fed backstops C?
Can any of you whizz-kids explain why this bailout had to involve the purchase of toxic assets?
I get that a bailout is absolutely necessary, and quickly, but why not use Buffet’s investment in GS as a template?
Put up to 20% new capital in troubled banks in exchange for perpetual preferred shares paying 10% and callable at a 10% premium plus in-the-money perpetual warrants for an equal amount. If any bank out there needs to replace more than 20% of its capital just to survice it should be sold to another bank that can fall within the limits and take advantage of the stabilization plan.
Why is the taxpayer buying the assets and not the institution?
futures will be locked limit up. hurray. we are saved, saved, saved from ourselves. thank you Sec. Paulson and Dr. B heroes, heroes one and all.
I cant wait to buy stocks tomorrow!!!
The bull is back baby.
Ted spread will collapse, a2p2 sread will come in, John Mack and Blankefein to be lauded for “excellent” stewardship. Fortune mag already has the cover photo.
Good times are here again, putting on my spats and doing the fox trot- the Jazz Age lives on!!
futures will be locked limit up. hurray. we are saved, saved, saved from ourselves. thank you Sec. Paulson and Dr. B heroes, heroes one and all.
I cant wait to buy stocks tomorrow!!!
The bull is back baby.
Ted spread will collapse, a2p2 sread will come in, John Mack and Blankefein to be lauded for “excellent” stewardship. Fortune mag already has the cover photo.
Good times are here again, putting on my spats and doing the fox trot- the Jazz Age lives on!!
futures will be locked limit up. hurray. we are saved, saved, saved from ourselves. thank you Sec. Paulson and Dr. B heroes, heroes one and all.
I cant wait to buy stocks tomorrow!!!
The bull is back baby.
Ted spread will collapse, a2p2 sread will come in, John Mack and Blankefein to be lauded for “excellent” stewardship. Fortune mag already has the cover photo.
Good times are here again, putting on my spats and doing the fox trot- the Jazz Age lives on!!
Well, there it is:
The definitive proof that the actual number of repeated posts is inversely proportional to the IQ of the poster.
at what point does carney get busted at clusterstock for putting this proposal up at 11:30 and timestamping it to 10:00?
Federal involvement and WB going to zero are not mutually exclusive. See WaMu, stay away from WB.
if I was Dickie Fuld I’d get myself a good lawyer, and start investigating countries without an extradition treaty… maybe Venezuela? Then Chavez can put him in a cage pulled by a donkey, and parade Fuld through the streets of Caracas…. the people can throw rotten plantains at the greasy capitalist… but Dickie, you can keep some money, and it’s better than 3-5 up in Ogdensburg, NY!!!!
@10
that’s another gasparino scoop. i didn’t see anything in his reporting about wb going to zero. face it, top bank execs have been meeting every weekend for the last few weekends. the question is whether c and wb execs are meeting face to face today and gaspar doesn’t make that clear.
@5-7 you are a retard.
What’s going to happen to WB? Is there a silent run on the bank going on? Will they need to be sold? I thought they were too big to fail and that their massive amounts of deposits would protect them.
WB article on CNBC: http://www.cnbc.com//id/26918308
@14
You’ve answered your own question
Q: “their massive amounts of deposits would protect them.”
A: “a silent run on the bank going on”
Bess, great job on the weekend report!
Honestly, this doesn’t fix anything. Anyone buying into this market will
be surprised by what will happen in the next several weeks. Wit short selling restrictions and the Fed taking shares as collateral, this market is mispriced. There are artificial price floors in place that do not adequately reflect what many of these firms are worth.
Unfortunately, it takes real work to figure out what anything is worth now.
Cantor Fitzgerald has a nice online gambling software, hopefully they will allow some betting on individual stocks.
http://www.cantorgaming.com/about.asp
This is insane.
@ 14 well if WM was sunk because people started agressively pulling their deposits out then it doesn’t take much to think the same thing is going on at WB.
Will they need to be sold? Pay attention they have been agressively looking for deal for the last 2 weeks. MS walked away because of the level of illiqiud assets on balance sheet.
If fed doesn’t step in no buyer – then watch for repeat of WM. Stock, preferred, debt goes to zero and deposit base is picked up by another entity.
Without a deal tonight they will be done by teusday.
Good damm those short sellers – things have really improved in their absence.
WaMu has established that the depositors at a bank can be protected without protecting any of the investors. Suffice to say, that makes betting on any “the government would never let these guys go down because of the deposits” salvation risky…for *any* garbage bank stock. The government can nuke you AND save the little old ladies.
On the plus side, you don’t need to worry about your accounts with any of these banks.
can we still short the dow, sYp and nasdaq? daddy needs new shoes..
Anybody find it amusing that the short sellers were probably the best protection that average investors had against some of these financial names.
Many investors (listening to bad advice) see financial names trading at all time lows and governemt salvation right around the corner. The also believe that the problem with the finanical names was the “short seller”.
Governement has really helped out average investors by banning the only real truth tellers in the whole system. I am sure the owners of $5 WM shares form September 18, 2008 are thankful that short sellers were banned.
@ 20. Yes.
But the shorting of these indices still lacks effeciency because (especially when it comes to S&P) because many names in index cannot be shorted.
See @17 for nice explanation.
@21,
In this kind of market, you buy upfront calls and farther back dated puts, and ride the waves… Its not a pure play market anymore… and if you don’t like your quote, just wait a few minutes, it will radically change value again soon.
Hedge your bets, its almost game time…
~SEG
5 – 7 is just happy that he is now going to get bailed out of his sub-prime shit hole.
This sucks… I don’t have a mortgage and now I get the bill for all these assholes who were “keeping up with the “Joneses” in homes that they couldn’t afford!
This attempt to put an artificial floor under home prices is not good and will prolong the problem.
I can only imagine that Hank is shaking his head right now.
Why does drudge have a headline up that no matter what “stocks will be cut by 1/3″?
read it here first :
Belgium’s & Luxeburg’s govs team up to nationalize Fortis, will inject € 7bn.
Fortis’ stake in ABN Amro will be taken over by ING.
http://www.lecho.be/actualite/entreprises_finance/Un_accord_Benelux_semble_conclut_pour_Fortis.8082721-584.art
read it here first :
http://www.lecho.be/
Belgium’s & Luxeburg’s govs team up to nationalize Fortis, will inject € 7bn.
Fortis’ stake in ABN Amro will be taken over by ING.
http://www.lecho.be/actualite/entreprises_finance/Un_accord_Benelux_semble_conclut_pour_Fortis.8082721-584.art