Greenwald's thoughts on the plan

Glennzilla speaks

What is more intrinsically corrupt than allowing people to engage in high-reward/no-risk capitalism -- where they reap tens of millions of dollars and more every year while their reckless gambles are paying off only to then have the Government shift their losses to the citizenry at large once their schemes collapse? We've retroactively created a win-only system where the wealthiest corporations and their shareholders are free to gamble for as long as they win and then force others who have no upside to pay for their losses. Watching Wall St. erupt with an orgy of celebration on Friday after it became clear the Government (i.e., you) would pay for their disaster was literally nauseating, as the very people who wreaked this havoc are now being rewarded.

The Plan

Via Ian Welsh at Firedoglake I have snagged the text of the "Paulson Plan" and included it here. Read it and I have a few thoughts that are interspersed as bold.

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY TO PURCHASE MORTGAGE-RELATED ASSETS

Section 1. Short Title.

This Act may be cited as ____________________.

Sec. 2. Purchases of Mortgage-Related Assets.

(a) Authority to Purchase.--The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States. Note that nothing here says anything about the properties upon which the assets are based have to be in the USA.

(b) Necessary Actions.--The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:

(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;

(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts; These will all be no-bid contracts going to Hank Paulson's buddies on Wall Street... that ones that fucked it up in the first place

(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them; see my comment on point 2

(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and

(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.

Sec. 3. Considerations.

In exercising the authorities granted in this Act, the Secretary shall take into consideration means for--

(1) providing stability or preventing disruption to the financial markets or banking system; and

(2) protecting the taxpayer.

Sec. 4. Reports to Congress.

Within three months of the first exercise of the authority granted in section 2(a), and semiannually thereafter, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate with respect to the authorities exercised under this Act and the considerations required by section 3.

Sec. 5. Rights; Management; Sale of Mortgage-Related Assets.

(a) Exercise of Rights.--The Secretary may, at any time, exercise any rights received in connection with mortgage-related assets purchased under this Act.

(b) Management of Mortgage-Related Assets.--The Secretary shall have authority to manage mortgage-related assets purchased under this Act, including revenues and portfolio risks therefrom.

(c) Sale of Mortgage-Related Assets.--The Secretary may, at any time, upon terms and conditions and at prices determined by the Secretary, sell, or enter into securities loans, repurchase transactions or other financial transactions in regard to, any mortgage-related asset purchased under this Act.

(d) Application of Sunset to Mortgage-Related Assets.--The authority of the Secretary to hold any mortgage-related asset purchased under this Act before the termination date in section 9, or to purchase or fund the purchase of a mortgage-related asset under a commitment entered into before the termination date in section 9, is not subject to the provisions of section 9.

Sec. 6. Maximum Amount of Authorized Purchases.

The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time

Sec. 7. Funding.

For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.

Sec. 8. Review.

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. Blatantly unconstitutional

Sec. 9. Termination of Authority.

The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall terminate two years from the date of enactment of this Act.

Sec. 10. Increase in Statutory Limit on the Public Debt.

Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.

Sec. 11. Credit Reform.

The costs of purchases of mortgage-related assets made under section 2(a) of this Act shall be determined as provided under the Federal Credit Reform Act of 1990, as applicable.

Sec. 12. Definitions.

For purposes of this section, the following definitions shall apply:

(1) Mortgage-Related Assets.--The term “mortgage-related assets” means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008. Nothing here stops a US company from buying up instruments held by foreign entities, as long as the original paper was issued before September 17, and then flipping it into the shitpile. This is a free for all. Note also that they slipped commercial mortgages in there too. So much for this being about sub-prime

(2) Secretary.--The term “Secretary” means the Secretary of the Treasury.

(3) United States.--The term “United States” means the States, territories, and possessions of the United States and the District of Columbia.

I am so pissed off about this whole thing that I can barely speak ... I think I need a guinness or 3 to take the edge off before I smack someone.

There are lots of good thoughts about this mess over at firedoglake, eschaton, calculated risk, krugman's place at the NYT,Angry Bear, digby's place and Naked Capitalism. Go read them all ... then come back and tell me that I am just panicking for nothing please.

Obama On The Paulson Plan

I haven't seen an unequivocal statement from the Obama camp on this yet. Let this post be a plea for sanity and a strong stand not only against this piece of shit plan but in favour of one drafted by someone that has a fucking clue and isnt just trying to get all of his wall street buddies rich

700 Billion Dollar Shitpile

What Dr. Black said

Any member of Congress who looks at the plan to give Hank unchecked power to transfer $700 billion from the Treasury to his friends' companies and has any reaction other than "You've got to be fucking kidding me" does not deserve to hold office

Call your member of congress, write them, fax them, email them, put up billboards, chase them down the street and threaten to have them arrested for blowing goats ...

Just dont let them vote in favour of this horrible plan.

Please!!

Krugman Has A Thought

Paul Krugman, over at NYT, has the best take that I have seen yet on this demented attempt at fixing big shitpile (with apologies to Atrios).

And there’s no quid pro quo here — nothing that gives taxpayers a stake in the upside, nothing that ensures that the money is used to stabilize the system rather than reward the undeserving.

This plan pretty much defines moral hazard while at the same not not even having the desired effect of stabilizing the system. There are still going to be companies that are going to go down the shitter and we are going to end up in the same place as before except for the fact that a trillion or so dollars will have been sucked out of our pockets and put into the pockets of the people that fucked it up in the first place.

If the Dems in Congress go along with this piece of shit they have effectively sold out any hope of substantive health care reform, or much of anything else that requires money, for a generation.

I am just fucking appalled

McCain, Healthcare and the Financial Industry

Via DDay at Digby's place, Josh Marshall at TPM, kos at his place and last, but not least Krugman at the NYT comes this brilliant statement from John McCain that should make any sane person decide that he really isn't competent to be President.

Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.

Now, I know that this was written before the events of the last couple weeks but anyone with a fucking clue has known that the financial system has been on the verge of melting down for some time now.

I can't wait to see how they walk this one back.

John McCain ... Not Ready To Lead

Carly Fucks Up By Telling The Truth

On CNN via Huffington Post comes this bit of comedy gold.

Asked by a St. Louis radio station whether she thought Republican vice presidential nominee Sarah Palin could run a company like Hewlett-Packard, Fiorina responded: "No, I don't.

“But that's not what she's running for. Running a corporation is a different set of things."

Asked about that remark on MSNBC, she made the same unprompted assessment of the GOP presidential nominee. "I don't think John McCain could run a major corporation."

--SNIP--

"Carly will now disappear," this source said. "Senator McCain was furious." Asked to define "disappear," this source said, adding that she would be off TV for a while – but remain at the Republican National Committee and keep her role as head of the party’s joint fundraising committee with the McCain campaign.

Fiorina was booked for several TV interviews over the next few days, including one on CNN. Those interviews have been canceled.

Of course this is the same Carly Fiorina that cratered HP's share price and got her ass fired. And of course this means that she would end up as Secretary of Commerce in a McCain administration.

McCain for Prime Minister

It occurred to me while reading a post over at Angry Bear that perhaps John McCain has just become confused as to which election he is running in.

Canada is having an election as well and since he thinks that Crocs and the Blackberry are the kinds of things that make this country great, maybe he is talking about Canada.

As a Canadian living in the US I am not sure that I would wish him on my native country but I sure as hell know that I am not very interested in having someone as out of touch with reality as he seems to be running my adopted one.

Fuck No!

via Naked Capitalism and Calculated Risk comes news of this proposed nationalization of AIG. And let's call it what it is ... when the govt buys 80% of something .. it is a state owned company ... Welcome to the Union of American Socialist States.

By the way, I am not averse to socialism .. i just would like my healthcare first before we bail out every greedy fuck that raped the financial markets over the last few years.

But no .. I am not bitter at all

WTF

From fivethirtyeight.com
How the flying fuck does this make sense in a world where people can actually tie their fucking shoes without assistance.

John McCain is old, cranky, stupid and out of touch.
Sarah Palin is completely unqualified, loves pork, a lying twit and completely fucking clueless about anything outside the border of alaska.

If the election was held today they would win ...

I fear for this country.

Sarah Palin - Just Plain Evil

This ain't hunting folks

John McCain - Pedophile Enabler?

Just thinking out loud