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Treasury defends bailout bait-and-switch

Posted Nov 14 2008, 01:22 PM by Minyanville
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It's the classic bait and switch: Offer up a shiny, too-good-to-be-true trinket and hook the buyer - only to deliver a rusty old spoon.

The bailout sounded like it was just that: Too good to be true. $700 billion deftly injected into the financial industry to sop up toxic assets, an end to ad-hockery that would not only rescue the financial system from imminent collapse, but would also turn a hefty profit for taxpayers.

With almost half the bailout money spent, Ford, General Motors, and Chrysler teetering on the brink, only marginal improvement in credit markets, and an economy that's badly lost it's way, a rusty spoon isn't sounding all that bad.

Yesterday, in what can only be described as a rather unprecedented show of cowering to the American media machine, the Treasury Department defended itself ... from the Washington Post.

The Post ran a piece entitled "Bailout Lacks Oversight Despite Billions Pledged," detailing failures on the part of bureaucrats to keep tabs on their Frankenstein-ish bailout machine.

Oversight behind schedule, opaque initiatives and a program whose initial focus -- and what was sold to the American people -- has been all-but-scrapped: The Post tore Treasury a new one.

The Treasury, for its part, shot back.

Arguing that the Post's assertions omitted many key facts, Henry Paulson and company issued a press release dubbed "Setting the Record Straight" to try to quash the public's growing discontent with the bailout. They trumpeted disclosure of contracts and other pertinent information on their website, efforts to choose a new Special Inspector General for the TARP program, the immediate convening of the Financial Stability Oversight Board, and regular briefings to Congress.

That Treasury even responded at all is astounding. Their continued focus on an aggressive media campaign to sell what our friends at BTIG like to call "half-baked ideas" is evidence of just how little credibility regulators have left.

Surely, the officials dealing with a financial crisis they call the worst in our lifetime have better things to do.

Top Stocks blogging partner Todd Harrison is founder & CEO of Minyanville.com. This post was written by Minyanville Contributor Andrew Jeffery.

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Comments

 

Doesn't it make sense that since one of the major factors in the economic crisis is an emotional component (lack of confidence, optimism, whatever) to try to address publicity that increases emotional concerns that would interfere with any sort of intervention.  I think one of the more important things the official have to do is to try to address the emotional factors as well as the financial factors.

It's very apparent that Treasury has hoodwinked Congress and the American people into giving them free rein again, as before with the Bush/Cheney usage of terrorism to plead their case for no oversight and "...we need secrecy to accomplish our goals....." techniques.  How many times must we endure this endless parade of false and misleading information.........ie., yellow powder uranium, weapons of mass destruction, axis of evil, etc........before we wake up as a nation and stop this insane power grab by the Bush administration??  After all, folks, Obama can only do so much to unravel the perils of the past.

If we really want to save our auto industry, here's the solution BUST the UNION.

We need to onderstand .

Throwing good money after bad IS NOT HELPING ANYONE !

lets sto p and consider PLEASE

What is the real problum here

Realestate. OK it is over valued  The bank ,Mortgage company, Real estate brokers and most of all the Fed knows it.

So it is time to quit beating around the bush.

!. Devalue all realestate by 25%  all loans from Mortgage company's and banks need to be reduced by 25% across the board

2. rewrite every loan and set a benchmark intrest rate. say 5.25 %

3.  A 100,000.00 loan  would now be a 75,000.00 loan. the bank still has the property and is still making a profit

The home owner Can afford the the new payment and scheduale

AND

will have about $200.00 to  $400.00 to spend back into the economy or to put into savings.

Wouldnt this be better then forcloser and bank failure and bailouts.

I dont know if we could put the blame on anyone But there is plenty of blame for everyone.

This greed to save the banks , mortgage houses,and the big wigs in the stock market is a farce.we need to put our house THE UNITED STATES OF AMERICA First

It is the people who are holding up the economy By working and going to work everyday. NOT weather th DOW is up or down.So get over yourselfs and fix the damn thing.

The Bush administration has been bamboozling the American public since the day it took office.  Why would anyone think any differently with the financial crisis?  If you had asked me...I would have let all the banks burn..."Survival of the fittest" is the mantra of the free market system anyways...

In retrospect it's painfully clear that Paulson and the Bush Administration never intended to deviate one iota from their initial demand for a blank check. After bamboozling Congress into believing they actually had a say in matters, Paulson made an end run and gave the banks the money the way they wanted it from the begiinning; with zero accountability and free reign to use it any way they wanted. And to prevent Congress or the public from ever reversing these actions, Treasury invested in non-voting bank shares without disclosing which banks got the funds.

No carnival side show was ever more deceptive than the plan that the Treasury Department just executed. It is the greatest bank robbery in history - the banks have robbed their customers.

From my prospective, what we need most desperately is to bring back, MADE IN AMERICA.

Our wages have been destroyed to the point many people will now work for far less. A new energy system needs to be developed, and made in America, and used for Americans exclusively.  It is what we need to fulfill OUR NEEDS, and to hell with the rest of the world.

It was our technology that got the rest of the world started, now let them sink, or swim as the case may be.

I am on the verge of developing a new kind of electrical generator, and I have figured out a way to turn leaves, grass clippings, and farm waste into biogasoline, which is 100% renewable, and far cheaper than crude oil.

IT'S CALLED YANKIE KNOW-HOW. And all you clown deadends who think the answers all come from China are in for a rude awakening. YANKIE KNOW-HOW HAS BEEN HERE ALL THE TIME. You, the dumb little kids missed it completely, because you are so dumb to begin with.

The greatest inventions come from us, the little people.

They don't come from the rich. The rich = 0. The politicians = 0.

Stand up for once in your tiny little lives, and refuse to purchase anymore imports.

If it doesn't say, MADE IN AMERICA, don't buy it!  It's all crap to begin with, and it was the rich, and their politicians that started flooding us with crappy imports in the first place for their own greed.

We need to look to our own people first

Send me a check and I will buy  a new car,maybe CEO won't get his hands on  the money.They  need sales that would keep people working and hopefully make  a little profit.A bailout isn't the  fix. They need business, not  a handout.I will be waiting for my check to buy the new car with.

Now doesn't that make more sense.

instead of giving large corporation billions of dollars at a cost of close to a trillion to the tax payers, why not give each household a million dollars. all bills would be paid, money to buy items, pay off mortagages, credit cards, department store bills would be paid with money left over. wouldn't this bill to the tax payers of less then 250 million be worth the effort than to give these poorly managed companies more money to give out as bonuses to a hand full?

The Klaus Baumann Proposal

December 2008 State Sales Tax Holiday

As an economic stimulus – why not create a nationwide State Tax Holiday on all purchases of Homes, Cars and Boats?  We all know that Federal Government sponsored bailouts might not be as effective as they are planned to be.  But a sales tax holiday in December might be a very good incentive to kick-start an immediate economic up-turn and retain jobs.  

A state has a lot to gain because if there are no sales of Homes, Cars or Boats, there is no sales tax revenue anyway.  But if there are STATE TAX FREE sales of those major items, current job are retained and more expendable money is made available for purchasing other daily necessities.

Perhaps a better solution…

Klaus G.E. Baumann

St. Augustine, Florida

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