[MeanWestTexan]

Cantor proving why he is so good an asset in the house. One of these idiots who understands economics

While I wanted Cantor as VP, this idea may just completely save our collective asses.

[DManA]

The BIG problem is Larry, WE won’t be paid back, ACORN and other left wing fronts get the profits.

[HuntsvilleTxVeteran]

The crooks that made money by looting now want more
money from the government to cover their looting!

[Mojave]

Any loan package bought by the Treasury will be 100 percent taxpayer owned.

What does that bovine scat mean?

[Greg67]

Great send me the stock! and the dividends from payments!!

[Centurion2000]

bump ... looks like a set of good ideas here.

[JLS]

I really worry that Cantor is unintentionally turning this bailout into a socialist plan. Buying assets is just that the US government buys the paper assets. It is not the government socialization of a market, but rather the government stepping in an buy in a market.

Now it seems Cantor want to turn this into a government insurance plan like FDIC. The government buy assets is a one time thing. A government back insurance of financial paper is an on going government program. We will have socialized some of the risk in the financial markets.

[BGHater]

‘I think it’s a good package that would be great news for stock and bond markets that are now ailing badly.’

Larry, no matter how you call it it’s still socialism. Go cheerlead somewhere else and stop with the Orwellian doublespeak.

[crazyshrink]

Hog manure!!! If these bankpapers, etc. were as likely to be paid back (w/ a profit-Ha ha), why in Hades are the holders in trouble?

A better idea.......give anyone, any business, company etc., a big cut in their taxes (capital gains tax, corp. tax, income tax, etc.) for taking on this “bad paper”. Then the gov’t and those the politicians won’t have their sticky socialist/communist fingers in the pie.
JMHO

[MeanWestTexan]

A Cantor ping to show that our faith was well-founded.

[NativeNewYorker]

First, taxpayers get the cash flow generated by the assets. (Something like a 10 percent interest rate.)

I work in the markets. Ain't nothing yielding a secure 10% that needs to be bought by the taxpayers. That's just f'ing silly.

[FreeReign]

In other words, suppose the Treasury buys a bond package at 20 cents on the dollar.

If the current value of the bond package is 20 cents, then they are NOT buying at 20 cents on the dollar.

[Greg67]

And Hey at 20c per $1 send Paulson-Cantor to sleep I buy directly from the market.

[count-your-change]

“I don’t think a lot of folks understand this win-win scenario. Let me repeat: The taxpayers own the bonds the Treasury buys; the taxpayers own the cash flows generated by the bonds; the taxpayers own the profits when the bonds are sold; and the taxpayers benefit when the profits and cash flows are used to pay-down government debt.

Actually, for taxpayers, it’s a win-win-win-win.”

Oh really? Will I see my win-win-winnings? No. All this stuff I now own, will see it? No. If I own a piece of these bonds, etc., can I sell my share? No. Do I have possession or control? No.

So pray, how do I own anything? Nonsense and double nonsense.

[Arec Barrwin]

Yes, the Paulson/Cantor plan is the way to go. Listening to Senators opine on the bailout is like a lawyer walking into a hospital and providing advice to a surgeon.

[palmer]

Let’s walk through this hypothetical for a moment. Through a market-driven auction, the Treasury will purchase some dollar amount — say $100 billion — of loans that banks will sell. The Treasury will then buy those loans at the prices that fill the auction, starting with the lowest prices and working up. Now, the Treasury will hold those bonds either to maturity or for a sale in the open market if rising prices in the market make that sale attractive. In other words, suppose the Treasury buys a bond package at 20 cents on the dollar.

I love how he smoothly switches from "bonds" to loans. The plan will buy neither, the exact language is "mortgage-related securities" defined circularly. That means they will buy worthless securities such as credit default swaps. They will buy far more than 700B, it will take trillions in purchases to put a small dent in the supply. A lot more will have to written off by institutions holding them. The government will burn all the ones it buys, won't sell anything.

[Straight Vermonter]

These are such a great investment vehicle everyone is rushing out to buy them, right?

[SoConPubbie]

While I wanted Cantor as VP, this idea may just completely save our collective asses.

The only solution that will work is a market-based solution without the government buying anything or "socializing" any part of the market.

A credible plan has already been given by the Republican Study Group and has been posted here many, many times.

Paulson's plan is a no go and Kudlow is smoking crack with his statement of "Let me repeat: The taxpayers own the bonds the Treasury buys; the taxpayers own the cash flows generated by the bonds; the taxpayers own the profits when the bonds are sold; and the taxpayers benefit when the profits and cash flows are used to pay-down government debt.".

The taxpayers, or the OWNERS of this government, will not see one red-cent from Paulson's scheme.

[Waco]

Also require that certain products be manufactured in this country, or a certain percent of them, create a lot of jobs overnight.

[arthurus]

The plan that will have the fewest bad effects and that will not create “necessities” for further government intervention is the plan to kick this thing right out of the Congress and let the market do what the market will do. There will surely be a short sharp recession and after a couple of quarters or a year of it, a solid recovery. Any sort of “bailout” and intervention will prolong the ill effects and prevent a healthy recovery for years and then the recovery that occurs will be a paper recovery; the numbers will be based on inflation and government spending and household prosperity will continue to decline. I fear we are looking at the long desired-by-Democrats final transition to socialism. FDR made the first big step economically. LBJ added a huge social component. Now maybe Bush and this Congress will put it over the line.

[fire and forget]

I wish to God posters who don’t know what they’re talking about on this issue would withhold their say until they’re up to speed or else defer to those who are. We have a confidence crisis which is wracking our financial system. Nobody likes being in this situation, least of all the banks (looters?), but aside from a wholesale cratering of the economy, the alternative is to lower reserve requirements and in effect massively increase the money supply.