Wonkette
So you know how the Fed “bailed out” AIG with $80+ billion and now everything is okay? Right, it’s not okay at all. The $80+ billion allows the failed insurance giant an “orderly liquidation” of its assets. AIG is done. That is just one of the reasons why the markets continue to collapse today — the Dow’s down 240 at the moment, or 2.16%, the NASDAQ’s down 3.2%, and the S&P 500 is down by 3%. Oh, and the last remaining American investment houses took huge hits, again. Morgan Stanley dropped by thirty-freakin’-seven percent, this morning, and Goldman Sachs fell more than 20%. But what’s the bad news?
- “The Federal Deposit Insurance Corp., whose insurance fund has slipped below the minimum target level set by Congress, could be forced to tap tax dollars through a Treasury Department loan if Washington Mutual Inc., the nation’s largest thrift, or another struggling rival fails, economists and industry analysts said Tuesday.” [AP/Yahoo]
- “The government doesn’t have the $85 billion needed to bailout insurance giant American International Group. The treasury department announced this morning it would auction new debt to raise funds for the Federal Reserve’s rescue plan for AIG.” [CBS News]
- “Russia halted stock trading for a second day, poured $44 billion into its three largest banks and relaxed restrictions on lenders to stem the worst financial crisis since the nation defaulted a decade ago.” [Bloomberg]
- “One of the original and largest money market funds has put a seven-day freeze on investor redemptions after the net asset value of its shares fell below $1, in a rare instance in the fund industry of what is called “breaking the buck.” [MarketWatch]
Ruh-roh.
Four more years!
All because assholes wanted houses they knew they couldn’t really afford and got banks to loan them money?! Jesus it’s mind boggling.
Time to learn Chinese? Not at all. We’re going to bring their country to its knees with our trillions in worthless t-bills. Communism finally defeated without firing a shot! George Bush is a GENIUS!
Thanks be to God that we got ourselves a cash printer when we did! Don’t know how I’d buy gas without her.
irisheyes: Also, possibly a little too much de-regualtion by the (R)’s, that allowed these greedy bastids to ruin the country, while sailing away on rafts of worthless money..
they said that it’d go good for me
rain diamonds and all that
I stood out in the downpour
gettin hit by broken glass
-Isaac Brock, Ugly Casanova, “Pacifico”
Only a hater would bring this up.
irisheyes: Sort of, but don’t forget the part about the greedy bastards that took those shitty loans and sold them as if they were gold, and the part about the stupid idiots that rated those packaged loans like they were a AAA investment, and the part… oh, fuck it… so many people to blame, and yet no one to actually throw stones at… I just want to stone somebody already!
irisheyes: No, that’s the tip of the iceberg. The problem is the “shadow” market that was hot potatoed around.
http://www.dailykos.com/storyonly/2008/9/15/124633/517/496/599528
“The value of the entire U.S. Treasuries market: $4.5 trillion.
The value of the entire mortgage market: $7 trillion.
The size of the U.S. stock market: $22 trillion.
The size of the credit default swap market last year: $45 trillion.”
Truculent: Or….the Chinese will roger us like a new cabin boy.
O.K., so things are looking dicey for everyone, not just fat cat wall streeters, if this financial freefall continues. But you have to admit, watching the what might possibly be the impending collapse of American capitalism - make that global capitalism - is kind of exhilarating.
You guys keep watch and let me know the next bloated amoral exploiter of workers and the environment that’s going to implode. I’m going to go gather some canned peaches and what not. Get a wheelbarrow in case I need to hit the road with my son.
The issue of economics is not something I’ve understood as well as I should, but I have Greenspan’s book and I don’t believe we’re headed into a recession. I believe the fundamentals of this economy are strong and will remain strong. The fact is that we have some tough times ahead, but we’ll get through this rough patch.
So elect me and the puck bunny presidents.
We all own this debt. We have become socialists! Good luck in getting health care though. We’re not THAT socialist.
Good thing I’m unemployed these days because it looks like a swell time to be looking for a job
Iggy Plop: “watching the what might possibly be the impending collapse of American capitalism - make that global capitalism - is kind of exhilarating.”
Of course, they continue to blame it on lib’rul marxist commies and people who think bad thoughts at the same time as they nationalize our banking industry.
On the bright side: if McPain is elected, it’ll accelerate our demise. Economic collapse followed by mushroom cloud. It’ll be over before we know it.
Tawmn: Yeah, just in the “tell you what to do” and thought reform ways, not in a benefitting the people and society sort of vein.
I knew I should have paid attention in Econ in high school. Every single one of these posts makes me convinced I should hide my money in my mattress and stick on a tin-foil hat, but I’m not sure why.
I’m not sure how it would help to learn Chinese, because they’re in deep doo doo right now as well. The Shanghai stock market is down something like 60% this year.
It’s kind of fun watching the whole Republican corporate-state fraud start to unravel just before the elections.
irisheyes: Everybody wants a house they can’t afford. It’s the American way. You can’t blame people for wanting a better life.
You can, on the other hand, blame the Republican party for deliberately gutting the U.S. treasury.
And still, no one ANYWHERE is talking about the Keating Five scandal.
Where’s that money tree my parents always claimed not to have? I needs me one o’ those. And a pony.
Yeah, all these goddamned crooked bailouts have magically made ALL Americans stakeholders in the markets! Looking good, Billy Ray! Feeling well, Louis!
tunamelt: Skip the hat — you don’t want anybody coming after your tinfoil supply.
I maintain that this only matters for people who own things that don’t fit in a backpack and have savings above three digits. That puts me in the clear!
The treasury department announced this morning it would auction new debt to raise funds for the Federal Reserve’s rescue plan for AIG.
You know the economy’s in deep doodoo when the people who print the money don’t have it.
Thank God I still have my day job: http://graphics8.nytimes.com/images/2007/08/29/us/29lede_squeegee_span.jpg
illnoise: I do! I wrote about it last night. I mean, I wrote about how it was all John McCain’s fault. Which is sort of vaguely true.
I knew there was a reason I rent and have no savings.
Ken Layne: Wizard, on the Trading Places reference.
gurukalehuru: You can’t gut the US treasury, they can literally print their own money.
Also, T-bill yields are now at levels last seen after Pearl Harbor. Logically, this means that happening to our country right now is worse than Hitler.
Since Republican prosperity isn’t ‘Trickeling down’ to the masses I think its ironic the same masses can ‘trickel up’ the lack of prosperity to their corporate overlords.
Can’t we all name some large public building after Ronald Reagan and feel all better again?
Harvey Birdman: Oh! you’ve met my ex as well?
bigfatresume: You’re just saying that to make us forget our troubles. But I apppreciate it.
irisheyes: If ONLY it were that simple. The housing collapse was only the fuse…the bomb is the unregulated derivitive markets that allowed capital firms to speculate (that’s gamble to you and me) on market perceptions and news waves with cash that was leveraged to the hilt (that’s borrowed - 30 to 1 in many cases) resulting in a very very large pyramid scheme that is now coming crashing down.
See, Wharton and the other MBA factories have been churning out MBAs with Finance concentrations who were wicked with a pivot table but not to clued-in to how to actually build a business that provided a service or manufactured something while providing jobs with good wages. Rather the learned how to build a shell that could attract capital investments or how to take an existing company and ship the expensive parts overseas (read your job) and make it look, at least on paper, that they were more profitable, thereby boosting short-term profits, which they had convinced all, including Bubba Whitetrash, was the true measure of success.
Oops.
Not only did the neo-cons change the markets to allow for unfettered gambling, they changed the metrics of measurement to hide the true health of the very markets they were destroying.
Clever…like snake-oil salesman is clever.
Iggy Plop: ah, yes, hit the road … that movie is sure to raise everybody’s spirits …
Do you think there’s a possibilty we could go back to trading animal pelts with the Indians? There’s a lot of roadkill in my area, and I’m just thinking that maybe I should get my ass out of this worthless office and start saving for the future.
So, we have about six weeks for the markets to totally implode (I mean really crash) and multiple huge banks to fail. Then, as the bread lines start (stockpile your flour, people!) and violence spreads, it will be perfect timing for an “emergency executive order” to maintain peace, suspend th writ of habeas corpus, and delay the elections for two years.
I for one welcome our newly hoboed overlords.
Truculent: Ha…if only. If the Chinese dumped their holdings for a penny on the dollar they would suffer…we would collapse. The chinese would just send everyone back to the fields and would shoot whomever complained and ignore those who starved until they stabilized. We can’t do that cause Bubba has guns.
On the plus side, the market meltdown has given this headhunter working in midtown Manhattan LOTS of time to peruse Wonkette. It doesn’t take that much time to answer the phone and say “sure, send your resume” since I won’t actually read it because there are NO JOBS.
I have for years wondered how long we could maintain the “bigger, faster, more” society. When we were house hunting (in a minivan, not from a helicopter) I remember asking my husband, after looking at another Cape Cod for 300K- how can this may people afford all these huge houses? Turns out- they can’t. Now I’ve got my fair share of debt, so I understand financing what you’ll eventually pay for. I guess I’m looking for somebody to blame.
I really want Obama to go all Rambo on this issue- he started yesterday with the “current crisis is the result of a failed financial policy” line, and I really want him to nail McCain/Bush and make it stick all the way to Nov. 4th.
Tawmn: Even better, McCain’s health care plan would require you to pay taxes on your employer’s contribution. Truly charming.
I for one am looking forward to feasting on MBAs and CFAs for sustenance. Their meat’s soft and well marbled.
illnoise: It’s insanity. With all of the cable stations and their infinite airtime to fill you’d think they could do a little “remember the S&L scandal under the last Bush?” segment here or there… John Glenn is still alive to talk about what he remembers from the time… craziness… It’s all newspeak, and if it’s five minutes old it’s on the History Channel.
So does anyone in the LA-area want to go freegan dumpster diving behind Whole Foods and Trader Joe’s?
Ken Layne: It’s true enough for blogging, at least!
bigfatresume: Ha ha ha…jokes on us. They have been taking all of those excess profits that were skimmed off the top of companies by executives and gambled away at their casinos and have been buying up their old lands…for Cash. God does not make new dirt. Yeah, we will be trading pelts…to clothe ourselves while they drive buy in the hummer they got for some dishes.
Got some nice apples over here! Seriously.
On the bright side, it’s brought us this:
http://farm4.static.flickr.com/3162/2864507526_419eff408a_o.jpg
bigfatresume: Sometimes I think that would be for the best - there’s no saving us now, just take what you have and run while you can.
tunamelt: I call the Valley dumpsters! Back off bitches, there’s some mighty fine dining in them thar Whole Foods dumpsters.
yourwildhorses:
LOL
all because we sold our souls to shoddy overseas markets?
all because we spend more than we bring in?
all because we give money to orphans with aids?
all because some yahoo threw several trillion dollars into a burning oil well?
I don’t have any investments, just tons of student loans. That said, I’m somewhat content to sit back and watch the financial industry implode. Burns motherfucker burn. Sadly, the Government has pushed for deregulation in recent years, the fat cats ran wild, and now they’re using MY goddamn tax money to save these fuckers. Or they’re spending money rebuilding Iraq. Fill the goddamn potholes on my street! Get me some goddamn public transportation and health care. They say the bail out is for my own good and that somehow AIG burning to a crisp would hurt me. I don’t fully understand how because I don’t have life insurance, I don’t have investments, no portfolio, I don’t need anymore loans, nor will I probably (ever) be able to buy a house in California. That said, the only silver lining I see is that maybe, finally, something will click with the GODDAMN MORANS IN THIS COUNTRY and we can get some SERIOUS REGULATION and Barry in the White House. If not, I’ll watch the country implode from a beach in Argentina. So long motherfuckers.
In these tough times only somebody with the experience and resolve of John McCain can save us.
McCain/Palin ‘08! (HaHa, just kidding. He’ll get elected and then we’ll all die.)
bigfatresume: Yeah, on a slightly different subject (don’t want to think about my 401K anymore) does anyone besides moi get the jeebus skeered out of them thinking about SP with the codes after Walnuts has a heart attack on, oh, January 22. 2009? What with her being a believer in the rapture and all? Cuz it kinda skeers me a little more than this money meltdown. Of course, without unlimited credit and unlimited Manolo’s, is life really worth living?
AfghanVet:
FYI, Amount of securities in derivatives?
45.5 TRILLION US AMERICA DOLLARS!
THIS IS NOT A TYPO!
45.5 TRILLION! Even 5 1/2 years in a POW camp can’t make up for that fucking number.
Bigger than all other debt/securities combined.
nuckingfutz: Save the arugula for Barry. He’ll need his strength when he takes office.
I KNEW a Chinese linguistics degree would come in handy! Y’all can work for me once the takeover occurs.
I was sort of looking forward to Lehman Brothers
being auctioned off on eBay.
Since that seems to be the policy/wave of the future.
Aveeno!
Let’s just hit the reset button. Cancel all debts and start over. Keep the house you’re living in. Renters and the homeless get fucked. It’s the American Way.
irisheyes: I was a receptionist in a real estate office during the housing bubble, and I can tell you that the vast majority of people, if asked how anyone could afford houses that expensive, would answer something like, “I didn’t think I could either, but the mortgage broker explained it to me!” Basically, I think the bottom line is that most people don’t understand financing, and they trusted that the people they were paying to help them - mortgage brokers, and banks - wouldn’t agree to give them a bad loan because it was their job, or it would hurt the bank’s bottom line. The problem with this is that mortgage brokers get a commission based on the loans they approved, and banks get money *now* if they just approve it too. Neither group thought anything like longterm, and it’s coming back to bite us all in the ass. And all this misleading and professional misconduct is practically nothing compared to all the leveraged trading others explained above.
Could it have really been that bad during the depression if they could afford to hand out FREE coffee and donuts? I mean, if this world market collapse means FREE donuts, I’m all for it.
AnnieGetYourFun:
Nei hao, Gwai Lao.
…I dont know about you guys, but I have already made a list of all the retailers that I’m going to loot once society begins to fall apart.
1) Al’s Porn Emporium
2) ABC Liquor
3) Red Neck Ammmo and Arms
4) 7 Eleven(you can never have enough beef jerky during the apocalypse)
nuckingfutz: The one on 3rd or the one in WeHo is closer to me, so don’t worry.
I’ve got a grand idea: Let’s privatize Social Security!
Gopherit v2.0: The Scene: Beijing, later this week
“Hi, Treasury Department? yeah. This is China calling. So listen, we’re in kind of deep with you folks on these treasury bonds…”
Treasury: “Yeah, so what about ‘em?”
“Not being critical here but it seems that perhaps you guys are not doing a A+ job managing your economy and all. So we’re thinking we would like to cash in some of those bonds a little early.”
Treasury: “Nah, we don’t think so. We’re a little short this week”
“Why not? They’re backed with the full faith and credit of the United States government, right?”
Treasury: “Uh, sure. Keep that thought. Full faith and credit.”
“OK, so we want to redeem some of these things. Some, ummm, unexpected expenses have come up.”
Treasury: “I already told you. Not now. Each according to his abilities and each according to his needs, right? We need you to back the fuck off. Are you able to understand that? Or do we just default on those motherfuckers and drag your godless, Mao suit-wearing, garlic-based economy back into the freaking middle ages? Shit, most of you people are still digging in the damn mud anyway. You won’t miss it.”
“You’re willing to destroy the world’s largest emerging economy?”
Treasury: “This is the Bush administration, asshole. We’re the deciders. And we’ve decided to bankrupt your socialist ass. Now, if you want to talk about some very nice banks and insurance companies that just came on the lot today, we can do business. Cash only. No checks”
What a sorry bunch of whiners you all are.
AnnieGetYourFun: Chinese linguistics is the only pleasant thought I’ve had all day!
irisheyes: But that would stick Obama with the mess. I say that the best solution is Show Trials. http://www.tristarmedia.com/bestofrussia/images/stalin-poster2.jpg
Bring back the Cheka and round up the usual suspects.
And I thought war was supposed to fix a feeble economy. Jeeez, we can’t do anything right anymore. Hey, can anybody spare a dime?
NoWireHangers: I’m with you…the only investments we have are my wife’s 401k…I want to see some blood…
CorkPopper: Ha, jesus, that is depressing. For them, I mean!
The Fed puts together a loan for AIG, which is has as much liquidity as Death Valley. The government gets 79.9% of the equity in AIG. So they trade 85 BILLION for a majority stake in a company that might be worth ten percent of that. And that company will now be owned/controlled/managed/overseen by the same people who allowed this farce to happen in the first place.
What could possibly go wrong with that?
I think George Bush and Henry Paulson should run every company in the world.
I KNEW I should have dumped my mutual funds and invested in….oh, all that only gets me an ounce of gold? sheeyit. There goes that “nest-egg.” Better idea: pay off my grad school loans.
30 billion to bail out homeowners! Hillary are you out of your mind?
85 billion to bail out AIG? Let me get my wallet.
Gopherit v2.0: oh that’s ……. interesting. we’re doomed.
Truculent: Newell and I had a similar conversation this morning. It ended with, “It’s okay, Mr. Bernake, you can pay us in Aircraft Carriers. And nukes.”
JadedDIssonance: I let them repo my education, and I haven’t missed it.
Ken Layne: Personally, I’ll take a bunch of those Predator drones with the missiles. Then I’ll finally have a workable solution for those people who drive too slow in the left lane.
ManchuCandidate: Shhhh…here is the most damning secret that will NEVER be covered or written about…
…with that much money in play and the ability to speculate at a Capital Gains rate of about 16% one can…shhh…manipulate market news AND the markets themselves to play the waves that are being ARTIFICIALLY produced.
Notice how the market fluctuates up and down while trending upward…or downward? Well, with enough money even small spikes and valleys can produce huge short term gains when one speculates on inside info and shaped information spewed on business channels by players that are in on the game. A tip here, a backing there, a well placed “worry” repeated by others…and the market moves somewhat predictably just long enough to get huge money in and out before the market stabilizes. With a half a trillion in (and most of that leveraged), even a .5 percent market gain can mean HUGE cash gains.
Think I am being conspiritorial? The advent of computer trading had to be completely regulated on the world market when it was discovered that countries could manipulate the world market via large transactions done instantly via computer. No such regulation exisits within our markets AND what regulation does exists is not and has not been enforced by the cronies (fox) appointed by BushCo to watch the markets (hen house).
See, Bubba don’t care because Bubba never saw that kind of money and never will…but Rove and Buchannan saw that they could never get this stuff passed without the help of God and his followers. So, now we have people who will watch Rome burn as they make sure gays can’t have butt sex and women can’t terminate a pregnancy.
Silence nation of whiners!
Ken Layne: We may repay them in nuclear bombs delivered by aircraft carriers. Somebody found some WMDs hidden among the T-shirt factories. `
AfghanVet:
I knew a couple of guys who wrote SW to manage that shit. Math gurus with PhDs and could solve 5th order differential equations while taking a piss.
I’d like to subscribe to your newsletter. Unfortunately, I don’t have the money to but I do have some goats (my neighbors really) and a slightly used Honda Civic to trade for it.
Well, there’s a new weapon in The Arsel of Freedom: shitty financial paper. Create some junk financial product like bingo-backed securities and sell them to the North Korean pension fund.
Gopherit v2.0: Flashman! Is that you?
Ken Layne: Matt Yglesias was making snarky references to the government owning the “commanding heights” so maybe we were moving to the “New Economic Policy”. I suspect we will find people who have become giddy from success and … i dunno … shoot them.
AngryBlakGuy:
I don’t think I’ve ever mentioned it before, but I find you very attractive. Can I come and live with you?
I say we buy back all of our debt from the Chinese by…giving them Alaska.
m_supercomputer:
Neither group thought anything like longterm, and it’s coming back to bite us all in the ass.
Not so! Housing prices always go up in the long term! Forever! That’s why subprime loans were often called “neutron bomb loans.”
AfghanVet:
Can you throw in Florida, Texas and Alabama, too?
AngryBlakGuy: I’d watch it. The guys at Redneck Ammo ‘n Arms have wet dreams of people attempting to rob/loot the place.
“Russia halted stock trading for a second day, poured $44 billion into its three largest banks and relaxed restrictions on lenders to stem the worst financial crisis since the nation defaulted a decade ago.”
What, Palin couldn’t see this coming from her perch in Alaska??? What fuckin good is it to have a Veep that can see Russia if she can’t see what is happening there…..
AfghanVet: But ANWR is our key to energy independence! Drill, baby, drill!
Wait, what?
if i were a small business guy, i’d really be pissed having to work 24/7 and taking 100% risk and now having my republican party bail the big boys out. i would vote for obama just for spite.
actually it’s chuck schumer’s fault and if all the welfare moms did not sell their stock everthing would be ok.
S.Luggo: Hah, like people are gonna have cars in 2 weeks…
AfghanVet: Never fear. We are still part Dubya’s Ownership Society. We have nothing to fear but ownership itself.
http://www.whitehouse.gov/news/releases/2004/08/20040809-9.html
http://en.wikipedia.org/wiki/Ownership_society
ManchuCandidate: And Louisiana. Please.
AfghanVet: I don’t think we can do that since
we can’t see China from here.
i’m not real good at this… so, should i be racking up the credit card debt and having fun before the world ends?
Ni hao bitches.
NoWireHangers for president!
Deepthroat: Are you new?
njdon: win!
Wait, did we just witness another black tuesday?
God this week went fast. It seems like Tuesday
was just yesterday doesn’t it?
WadISay: Wouldn’t that be a great Secret Service name for Dubya?
I can probably house another slave or two. Granted, if more than that show up, you’ll have to fight each other for the position or live in a box.
…Okay, you’ll be living in a box regardless, but at least it’ll be indoors.
Naked bunny…does this mean you still have, like, a house?
AnnieGetYourFun: Wo men shi hen fuck le.
No one has mentioned the truly dreadful nightmare scenario — we may have to listen to smug self-satisfied Paultards explain at length why St Paul of Obgyn’s economic plan is the only (final?) solution.
Truculent: Secretary of Treasury, and Communicating Complex Issues to Retards please? The position is available and your resume is pretty snappy!
NoWireHangers: “I’ll watch the country implode from a beach in Argentina.” Have you checked the inflation rate in Argentina recently? Since the IMF (or the American Enterprise Institute as it is known) encouraged private banks to deal in credit-backed instruments, 12 to 16%. Urban poverty 21%. [But that was as of a year ago.] Now mooseburgers cost two bars of guano and your first born child.
Better to move to the Seychelles. There the currency is green palm fronds. Learn to climb.
Country First.
The soup kitchen in that photograph was in Chicago, and Al Capone owned it.
Just think about that for a second. Do you think walnuts! would own a soup kitchen?
So right after GW invades the Whitehouse, ‘Foreclosure Phil’ Gramm and his partner ‘Hairy fist” Lugar shove the ‘Modernization Act’ up the Federal Budgets ass so far no one can see it.
Enron, Modernization Act co-writers, then romp madly - raping the dogs and stealing the wimmin’s in a drunken frenzy till they get busted.
Then the Modernization (de-regulation) Act lurks silently within the bowels of legislation, awaiting the next jolly crew of intrepid pirates to leap on it, salivating with joy and quivering with wholesome all-American greed.
Democrat Dana Perino just sent me a money order for 16 billion dollars! And all I had to do was pledge my firstborn to the McExxon wars on Siberia and Venezuela. This is sooooo cool! (What’s more, Ms. Perino didn’t even ask whether I had tied my tubes or not; given the murderous abortion agenda of Barry Osama, there’s no way I would bring a child into this sad, bankrupt world.)
Besides I have a garage full of tainted baby formula, bought cheap in Chinatown last year.
Dear Senator Obama,
If you don’t mention the KEATING FIVE in every stump speech and ad from now till November…well, truth be told, I’ll love you anyway. But you’ll force me to make the ads. And they’ll be mean to McNasty and his beloved Lipstick Pig. Stop me before I smite them with all my arugula strength!
Sincerely,
BobLoblawLawBlog
HA HA HA AH HA HA HA HA HA!!!!!
Market rebounds to where it was at the beginning of the week! So much for the end of the world this week! (Again!)
Eat your words all you Chicken Little’s!
Daveandemmy:
So you drunk yet?
Fuel Injected: that cash printer is a hell of a good idea, thanks for the tip, I can’t wait to get mine!
gurukalehuru:
It’s been their goal to gut the treasury for years, how else are they going
to stop the entitlements (social security, medicare, school lunch, etc….).
Can’t make it stop because it’s too popular, but if there’s no money…..
“You can, on the other hand, blame the Republican party for deliberately gutting the U.S. treasury.”
AfghanVet: Win, sadly fucking true, but definite Win.
shoeho: I used to have the same worries about Bush,
then realized that he was just a drunk using Jebus as a cover. Also,
Cheney was a stabilizer, what with his need for the world to continue
so he could pull his cash out of all his Haliburton hidden stocks.