Large Scale Central

Congratulations--you now own 80% of a failing insurance company

General Discussion
#1

Am I the only one who finds events on Wall Street really worrying?

AIG was the world’s largest insurance company, and as I understand it, it spent a lot of its time insuring financial risk–that is, put really simply if you wanted to buy some risky stocks, AIG would offer you an insurance policy against the stocks decline. It’s going belly up. no one wants to buy it, so we, the taxpayers have loaned it $85 billion and assumed majority control

It’s an unprecedented step–the Federal reserve is supposed to stabilize the banking industry, not bailout the insurance industry. Now we are assuming a socialist-like control of the world’s biggest insurance company

So much for deregulation and the free market

What it tells me is that things are much much worse than we know. The people in charge–Bernacke and the Bush Admin–are all strong free marketeers and deregulaltors, raised on the Reagan mantra of “less regulation, less regulation, less govt. interference.” Now they are rushing in–four times in the last 6 months–to prop up failing companies

I’m going to start hiding my money under the mattress

#2

I find it amazing, the Repubs got their long sought after 'deregulation" of the mortgage, banking and investment industries, now they’re paying for it, literally, with our money. Absolutly amazing how blind some politians are, you take away regulation, look the other way when these companies start acting more like pirates and snake-oil salesmen then businesses, then get all surprised when they screw the pooch and start cyring for a bailout, so much for their Neo-con economic polices, they’ve proven in the long run to have fostered only a robber-baron get rich at any cost mindset in the business world, interesting how every time we have a Bush in office, the economy ends up a complete shambles in the toilet.

#3

Yes and the Washington Post reports these facts:
http://www.washingtonpost.com/wp-dyn/content/article/2008/09/16/AR2008091603732.html

"A decade ago, Sen. John McCain embraced legislation to broadly deregulate the banking and insurance industries, helping to sweep aside a thicket of rules established over decades in favor of a less restricted financial marketplace that proponents said would result in greater economic growth.

Now, as the Bush administration scrambles to prevent the collapse of the American International Group (AIG), the nation’s largest insurance company, and stabilize a tumultuous Wall Street, the Republican presidential nominee is scrambling to recast himself as a champion of regulation to end “reckless conduct, corruption and unbridled greed” on Wall Street"

But as we know, reality has a liberal bias and can be safely ignored–until it can’t

#4
mike said:
Now we are assuming a socialist-like control of the world's biggest insurance company
I thought that socialist like control of industry would make you happy. Ar you sure that you are not a closet conservative?
#5

LOL!

#6

Got under your skin, again, huh? :lol:

#7

I’m actually happy to have more regulation of the banking/finance industry. I don’t think I’m happy to assume the bad risks of someone who made/makes huge amounts of money, and thereby protect him from the consequences of his actions

#8

So, you think we should have more regulation of the railroad industry, too? You agree with Maxine Waters, D-CA, that the Democrat Party will be taking over the oil companies?

What about Fannie Mae and Freddie Mac, who were run into the ground by Clinton cronies?

#9
Steve Featherkile said:
Ar you sure that you are not a closet conservative?
It only takes 20 years for a liberal to become a conservative without changing a single idea. - Robert Anton Wilson

A liberal is a conservative who’s been arrested. A conservative is a liberal who’s been mugged.

  • unknown

If you’re not a liberal when you’re 20, you have no heart; if you’re not a conservative when you’re 30, you have no mind. - Falsely attributed to Sir Winston Churchill, but actually a paraphrase of Francois Guisot.

#10

:lol:

And another one! A Conservative is a former Liberal who has two daughters. :smiley:

#11
Steve Featherkile said:
So, you think we should have more regulation of the railroad industry, too? You agree with Maxine Waters, D-CA, that the Democrat Party will be taking over the oil companies?

What about Fannie Mae and Freddie Mac, who were run into the ground by Clinton cronies?


Don’t know, haven’t looked into railroad regulation since it was part of the Populist Party platform in 1892

I don’t know what the “Democrat” Party is.

I would point out that neither oil companies or railroads are part of the financial industries–e.g. banks, and brokerage houses and mutual funds and hedge funds and private equity firms

I think there should have been more regulation of Fannie and Freddie, absolutely, and will happily fault the Clinton Administration if that’s where blame lies, although, as is often pointed out, that was 8 frickin years ago! IMHO, Clinton was far too enthusiastic about deregulation

#12

Deregulation is one thing I must admit I agree with you on Mike, at least when it comes to crucial services. Deregulation is a friend only to the relative few able to reap its benefits at the expense of the majority of us. I saw personally a stable, well run trucking industry changed into a chaotic and unreliable mess with deregulation. Carriers were regulated in the first place for this very reason. A few carriers were able to adapt such as UPS without major hurt to their workers or service but most went under to be replaced by rather questionable operators almost beyond any real control to protect either workers or customers.

It must be remembered however that while Republicans in general have supported deregulation that so too did most Democrats at the time. It couldn’t have passed without Democratic support just as NAFTA which was signed into law and promoted by Clinton.

I do favor as little regulation as possible but privatization of crucial services such as transportation, utilities, health care and financial institutions without oversight is folly. No for profit corporation ever made has put the interests of the people first ahead of profit and executive bonuses beyond paying lip service to them. There is nothing evil about profit itself however as long as it doesn’t damage the country and its people by being excessive when applied to neccessities.

The trend regretably has been towards ever more deregulation in all aspects of our society. We are reaping the harvest now of relaxing oversights too much. I hope I’m not sounding like one of you “lefties” :wink: but facts are facts. Regulation requiring reasonable and legal actions by companies is not the same as “taking over” free enterprise. After all as individuals we have rules to live by and we lack the multi layered protection of management that large corporations have. There is no reason for a corporation to be any less answerable to selfish, shady conduct than the rest of us.

#13
mike omalley said:
I'm actually happy to have more regulation of the banking/finance industry. I don't think I'm happy to assume the bad risks of someone who made/makes huge amounts of money, and thereby protect him from the consequences of his actions
I'm NOT in favor of more regulation in the banking / finance industry. I am also NOT in favor of using taxpayer monies to bail these greedy thieves out.

I don’t think most people realize it, but the U.S. government has essentially doubled the national debt over the last two weeks. This runup makes the cost of the war in Iraq look like pretty small potatoes. These bailouts of institutions and people who do nothing but push around paper ‘investments’, using other people’s money, are costing all of us real money: Ours. Why are we on the hook for this?

Bloomberg Press said:
The U.S. Treasury pledged an $85 billion loan for AIG just 10 days after committing as much as $200 billion to prevent a collapse of mortgage companies Fannie Mae and Freddie Mac. The U.S. budget deficit will grow next year to $438 billion, the Congressional Budget Office said Sept. 9
Then there are these conflicting reports:
Bloomberg Press said:
"The latest bailout comes at the expense of the U.S. taxpayer," Tim Brunne, a Munich-based credit strategist at UniCredit SpA, wrote in a research note today. "It cannot be expected that AIG will survive in its present form."
With this morning's newspaper reporting:
Santa Rosa Press Democrat Business Section said:
Analysts say most of AIG's businesses are, on their own in fine shape. But what is happening on Wall Street is at the root of AIG's troubles. The steep decline of mortage-backed securities has weighed heavily on the firm's balance sheet-just as it has on other fallen Wall Street firms
Our so-called financial regulators (Poulson and Bernanke come to mind) are using my money to bailout their buddies on Wall Street who's companies are ". . . in fine shape." Looks like the foxes are guarding the henhouse and enjoying a good chicken dinner!

Happy RRing,

Jerry

#14

Ya know, when Enron folded, we (the Feds) sent the Blackguards to jail. Ken Lay only avoided serving time by dying first.

How come there has been no call for the heads of the CEOs and CFOs of Fannie and Freddie by the MSM? Could it be that they are fellow libs? Hmmmmmm?

I’m not in favor of bailing these companies out. The market will correct itself. Neither am I in favor of allowing corporations free reign. Nor am I in favor of over regulation. After the gummint stopped putting it’s nose in the railroad’s business every whichway, the railroads finally were able to compete in the free marketplace. The downside is that now, there are only four Class I railroads, the upside is that there are a gazillion shortlines and regionals, so I guess we win, anyway.

#15

No, it’s that they didn’t commit any fraud–as far as I know. They’re guilty of bad management. Lay was guilty of fraud.

If the heads of Fannie and Freddie are guilty of crime, I doubt that being “liberal” will help them. Last time I checked the Attorney General was a Republican, appointed by Bush. But if they are guilty of fraud, I’d be delighted to see them prosecuted

#16

There must be at least a dozen attributions for this one, or something similar:

Anyone who is not a socialist at 16 has no heart,
but anyone who still is at 32 has no mind.
- Woodrow Wilson

#17

Old guys love that quote, with its fatuous tone of self-satisfaction

#18

Follow the money and you will always find the trail of greed and corruption. Yes, it is a worry, but I have no faith that it will ever change.

#19

Ric.

Sad to say the only way it will ever change is total collapse of the system.
Don’t think that cannot happen.
It surely can as long the foxes are in charge of the hen house.

#20
TonyWalsham said:
Ric.

Sad to say the only way it will ever change is total collapse of the system.
Don’t think that cannot happen.
It surely can as long the foxes are in charge of the hen house.


Tis true.