Bank stocks plunge on fresh insolvency fears

AP / Yahoo News ^ | Thursday January 15, 2009 | Stevenson Jacobs, AP Business Writer

[Notary Sojac]

The idea is to add liquidity

There is a lot more liquidity than there was five months ago. Whether there is any more solvency is what the world wants to know.

The only way to know that is for the banks to come clean and honestly value their balance sheets. Which I have been waiting for since long before Hank Paulson starred as Chicken Little.

[blam]

"I believe we are swiftly approaching the point where people are going stop caring about "fair" and start caring about their financial survival."

Financial survival? Wait till the food riots begin.

[CottonBall]

Bank of America, the bank of choice of people who bypass the immigration process and sneak into the US illegally, this could not happen to a more fitting bank.

I couldn't agree more. Our local branch has signs in spanish all over - and only a few in english. I'd love to see them have to close their doors.

[blam]

Treasury And Bank Of America Near Bailout Deal

WASHINGTON – Bank of America and the Treasury Department are near an agreement that will provide $15 billion to $20 billion in new government support to the banking giant, a source close to the discussions said Thursday. This source said that the injection of fresh capital will come from the government's $700 billion rescue fund and will be similar to assistance provided last November to Citigroup.

[snip]

[Neidermeyer]

QUESTION: Was BOA the bank that was handing out credit cards and banking accounts to people who could not prove they were legal cititzens and no credit history needed?
*****************************************************
Yeah ,, they seemed to have a contest going with WAMU to see how many illegals they could sign...

[expatpat]

That’s a good point, but a banking collapse would seriously damage our financial survival right now, whereas paying back the debt later is in the future.

[Neidermeyer]

What if they gave us the money back then?
**********************************************
Nothing to give back , gone ,,, POOF!! It was never physical currency ,, just some ones and zero’s in a database ,, and now those “dollars” have been all distributed and used up .. no more for you..

[expatpat]

It only takes a few million account holders to get to hundreds of millions, PLUS you get a major depression and the federal deficit balloons from that.

[gpk9]

"... but a banking collapse would seriously damage our financial survival right now ..."

How so? Exactly how would the bankruptcy of a few huge obese bloated overfed irresponsible banks seriously damage our financial survival?

[Neidermeyer]

The “velocity” of currency has slowed below 1.0 for M1 ,, this means that deficit spending or creation of debt of any kind including printing dollar notes has the opposite effect from what we were all taught where “stimulus” spending (however inefficiently) increases GDP/GNP numbers... There’s no real option but to reign in debt or stimulate the living sh*t out of the real economy ,,, ie. YOU and ME our labor and physical production ,,, the only way I see that working is to implement the FairTax and drastically curtail/rescind stupid gov’t regulations and such,,, RIGHT NOW...

This is why Bernanke is speaking about going back to the original intent of the bailout ,, paying off the toxic loans and cancelling the multiplier effects from them in the process... it’s really the only thing that’ll work (even just a little) other than tax relief which we all know will never be approved by the Rats including the big”O”...

Gold has pulled back a little because inflation isn’t in the cards ,,, wholesale inflation has been negative for a few months now and since gasoline/oil was UP last month you can’t put it all off on energy costs .. DEFLATION looks like a real danger in near future...

[gpk9]

" ... and have been responsible ..."

There is a difference between being responsible and being wise.

One can be responsible in faithfully paying their mortgage payment on time.

But what if said home was purchased at an overly-inflated price in an overly inflated market, with no or extremely low down payment, and said overly-inflated market has since collapsed, and said home is now worth far less than the balance on said mortgage?

[dalereed]

“a favorite of most conservatives”

More like a fear!

[gpk9]

"Bank of America and the Treasury Department are near an agreement that will provide $15 billion to $20 billion in new government taxpayer support to the banking giant ..."

There. I fixed it.

[dalereed]

“But what if said home was purchased at an overly-inflated price in an overly inflated market, with no or extremely low down payment, and said overly-inflated market has since collapsed, and said home is now worth far less than the balance on said mortgage? “

You still owe the amount of the contract and shouldn’t be relieved of the obligation to pay it in full.

I don’t believe that bankruptcy should be allowed for anyone under any circumstances.

[gpk9]

"I don’t believe that bankruptcy should be allowed for anyone under any circumstances."

My point and question have nothing to do with bankruptcy. My point is to illustrate the difference between responsiblity and wisdom. My question asks about the wisdom of the scenario set forth in the question.

[dalereed]

They not only made a bad decision that they should have to live with and pay in full but not making at least a 20% down payment they aren’t even home owners, they are squatters on real estate.

When I bought my first home, which I still own after 43 years, you had to put 20% down or you didn’t qualify for a loan.

[unkus]

>>Wait till the food riots begin.<<

I agree. How soon do you think it will happen?

[Ezekiel]

More news you can use.

Bank stocks plunge on fresh insolvency fears <<<

Bank of America shares fell as much as 28 percent -- dropping to their lowest level in 18 years --

And...

UPDATE: Bank Of America: 'Large Grp' Of Workers On NYC Plane

That's some bailout.

[justa-hairyape]

Great video. We should have been giving money to the banks that were doing good !. Very tragically funny stuff. Discovering that anti-capitalistic behavior only prevents recovery and that rewarding failure will never prevent failure. Who had been educating these people ? Must have been leading sheltered secured lives all funded by debt or trust funds. No cash capitalistic reality at all. Out here on the Streets of Reality we always knew that they were Throwing Good Money after Bad. And that don't get you anything but more bad. Oh well. Time for more popcorn and more shotguns shells.

[blam]

"But what if said home was purchased at an overly-inflated price in an overly inflated market, with no or extremely low down payment, and said overly-inflated market has since collapsed, and said home is now worth far less than the balance on said mortgage?"

How long have you know that you can't get something for nothing? I have no pity...assuming that's what you meant.