I’d pay to get all those people on the same show again for even 5 minutes.
The chief executives of the nine largest banks in the United States trooped into a gilded conference room at the Treasury Department at 3 p.m. Monday. To their astonishment, they were each handed a one-page document that said they agreed to sell shares to the government, then Treasury Secretary Henry Paulson Jr. said they must sign it before they left.
The chairman of JPMorgan Chase, Jamie Dimon, was receptive, saying he thought the deal looked pretty good once he ran the numbers through his head. The chairman of Wells Fargo, Richard Kovacevich, protested strongly that, unlike his New York rivals, his bank was not in trouble because of investments in exotic mortgages, and did not need a bailout, according to people briefed on the meeting.
But by 6:30, all nine chief executives had signed — setting in motion the largest government intervention in the American banking system since the Depression and retreating from the rescue plan Paulson had fought so hard to get through Congress only two weeks earlier.
Sounds a lot like what Herbert Hoover did at the beginning of the Great Depression. We all know, or should after reading the above link, how well that went.
Reid may not know what to do… but Paul does. Too bad no one listens.
http://thecaucus.blogs.nytimes.com/…
Senator John McCain, who was criticized by Democrats Monday for saying that the fundamentals of the economy were strong on a day that the bankruptcy of Lehman Brothers and the sale of Merrill Lynch sent stocks plunging, went out of his way Tuesday to make it clear that he understood that Wall Street was in “crisis.’’
At a rally here, Mr. McCain vowed to take aim at what he called the “unbridled corruption and greed that caused the crisis on Wall Street.’’
Mr. McCain – who has said for moths that he believes that the fundamentals of the economy are strong – has used the word “crisis” a lot on the last day to describe the financial situation. He did so in a series of television interviews Tuesday morning, where he called for the creation of a commission to study the problem, along the lines of the commission that investigated the Sept. 11 attacks.
“We need a 9/11 commission, and we need a commission to figure out what went wrong and how to fix it,’’ he said. “And I know we can do it and how to do it.”
OH OH!!! May I recommend some individuals to head up the commission? Ron Paul, Lew Rockwell, Hans-Hermann Hoppe, Robert Murphy, Joseph Salerno, Walter Block… just about anyone from the Austrian School.
“They have broken the social contract between capitalism and the worker.” It’s entertaining that this “conservative” is railing against the so called free market. Of course he’s no fiscal conservative and the US, as is much of the world, has a corporatist system. A system with a centrally controlled money supply which creates these monster corporations. He is either an idiot or a lier. Neither quality should be desired in an executive. The same can be of Obama.
Merrill Lynch to Be Bought By BofA for $29 a Share
Merrill Lynch, the world’s largest broker, agreed to be acquired by Bank of America for $29 a share, or $43.5 billion, after being pressured into a deal by federal regulators.
Merrill agreed to the BofA sale, which represents a huge premium to its closing price on Friday of $17 a share, after talking to several other potential acquirers, including Morgan Stanley.
Morgan turned down a possible acquisition because it couldn’t examine Merrill’s books in 48 hours, a person close to the matter said.
Merrill plans to make an internal announcement to employees sometime between 8 and 9 am Monday morning.
Merrill came under pressure to find a merger partner came after its liquidity began “evaporating” Friday and the firm became worried about a sharp decline in share price on Monday, according to people inside the firm.
Merrill is expecting huge job losses with the merger. The brokerage division will stay intact, but there will be large-scale reductions in workforce. CEO John Thain is also expected to leave.
Lehman Brothers Plans to File for Bankruptcy Shortly
CNBC has confirmed press reports that Lehman Brothers is likely to file for bankruptcy protection as soon as Sunday evening.
Among details to be worked out: the accounting treatment for certain derivatives and repurchase positions, an area not currently covered by bankruptcy laws; and the orderly netting out of a variety of securities positions to which Lehman Brothers is contractually obligated.
Federal authorities are expected to be involved in the orderly disposition of Lehman assets if such a filing occurs. Sources knowledgeable about the weekend deliberations tell CNBC that without some government participation in the process, a bankruptcy filing by Lehman Brothers would cause major disruptions in the financial system.
Officials at the Federal Reserve and U.S. Treasury are taking steps to mitigate risk to the system and assure the orderly functioning of the markets tomorrow.
AIG, Facing Liquidity Crunch, Reaches Out to Regulator
Insurer American International Group, working to stave off rating downgrades and shore up the capital of its holding company, has made an unprecedented approach to the Federal Reserve seeking short-term financing, media reports said.
Chief Executive Robert Willumstad has reached out to the Fed late on Sunday, according to the Wall Street Journal.
The Fed normally oversees monetary policy and supervision of banks, AIG was seeking the funds as a temporary measure and planned to repay the Fed with the proceeds from asset sales.
AIG officials did not immediately respond to requests for comment.
The company, until recently the world’s biggest insurer by market capitalization, has been attempting to hammer out an emergency strategic plan after its shares fell nearly 50 percent last week on fears it faced a liquidity crisis.
And now we are hearing of another interest rate cut. As if this situation wasn’t scary enough.
Who’s taking bets on the Amero showing up sooner rather than later?
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