What is nationalization?

CNN Money.com ^ | February 20, 2009 | Colin Barr, senior writer

[Oldeconomybuyer]

NEW YORK (Fortune) -- What does it mean to nationalize a bank, anyway?

That question has weighed on the minds of investors in the two weeks since the Obama administration's comprehensive financial industry stability plan fell flat.

And they came to a head Friday. Nationalization fears helped drag down shares of Citigroup (C, Fortune 500) and Bank of America (BAC, Fortune 500) as much as 36% at one point Friday. BofA recovered most of its losses to finish Friday down just 3.6%. But Cit's stock closed Friday with a 22% loss.

The term nationalization has been used to cover a range of very different outcomes. Most obviously, it refers to the outright takeover of troubled firms, such as when the Treasury Department put mortgage giants Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500) into conservatorship.

But it has also been used by some people to cover sizable investments that give government officials considerable say in a firm's activities -- such as the loan guarantees extended in recent months to Citi and BofA. [snip]

[Oldeconomybuyer]

It's what you get when you elect an inexperienced community organizer marxist from Chicago.

[jwalsh07]

Ina a word, Marxism.

[Candor7]

[The Great RJ]

To put it succinctly imagine the bank where you keep you money being run by bureaucrats like the post office.

[Argus]

It’s when Barney Frank gets to tell you what to do.

[Forgiven_Sinner]

It’s when a government takes over a private firm. That may be ownership or control; it does not matter, since both amount to the government taking property away from the shareholders.

[drypowder]

It’s what the fed gov will have to do to the entire US debt when it realizes we poor citizen suckers can’t afford to pay it. Maybe they’ll take a few US politicians instead.

[Red6]

And even here the MSM is still apologetic, soft spoken and nice in their presentation of what's going on.

Obama can do no wrong.

[Tarpon]

It simply means the government brings the newly printed fiat money in the back door, and tells everyone standing at the front door everything is fine.

This week I learned a new word “sextillion”. 89 sextillion is the inflation rate in Zimbabwe, that's 89 million million percent.

[Snoopers-868th]

http://globaleconomicanalysis.blogspot.com/2009/02/nationalization-revisited.html

The above link is to a site that believes certain questions should be answered before the nationalization of banks. Pretty informative article.

[Post Toasties]

What an idiot Greenspan is. He has come out in favor in bank nationalization, and just the thought of it’s already killing the economy.

[Post Toasties]

What an idiot Greenspan is. He has come out in favor of bank nationalization, and just the thought of it’s already killing the economy.

[spectre]

Hopefully, the panic that occured today was a dress rehearsal for what would happen if the Banks Nationalized.

Obama best shut up aboutit!

[OrangeHoof]

Just curious. If Citibank goes under, what happens to my credit card account with them? Do I get my balance forgiven? I mean, if Citi no longer exists then I don’t owe them anything, right?

[SnuffaBolshevik]

Citibank also has the contract for Federal Government travel charge cards.

How convenient.

[therut]

They have my mortgage. Maybe I will get a FREE house!!!! No durnit the governemt will own my house. To HECK with that!!!!!!!!!!!!