Worst-case scenario is approaching rapidly (crisis growing at Warp 9)

Times of London ^ | 10/06/08 | David Wighton

[TigerLikesRooster]

October 6, 2008

Worst-case scenario is approaching rapidly

David Wighton, Business and City Editor

The credit crisis, which has been building slowly for the past year, is now moving so fast that governments around the world are finding it impossible to keep pace.

On Saturday Angela Merkel, the German leader, criticised last week’s decision by the Irish to guarantee all deposits in their leading banks without consulting other European countries. The Irish Government said that the move was forced on it by the threat of a run on one of its banks. Only a day later Ms Merkel was forced to take almost the same action in almost the same circumstances.

In the longer term, this clearly raises questions about the hopes for (or fears of) European financial integration. In the short term, it presents serious challenges for other European governments.

A week ago the British Government was hoping that it had coped with its immediate banking headache after the bailout of Bradford & Bingley. With the proposed rescue takeover of HBOS by Lloyds TSB, this stabilised the two big British banks that looked most vulnerable.

Then came the shock move by the Irish Government to guarantee not only individual savings but also the large deposits held by companies. Downing Street was furious because British banks feared they would see a flight of money towards Irish banks.

Downing Street decided merely to accelerate the planned increase in the ceiling on guaranteed deposits from £35,000 to £50,000, although the decision remains under review.

[GOPJ]

I'm stating to think online lending groups (private citizens pooling their risk to lend) might work better than banks. Kind of like going back to what banks used to be... It would give "depositors" more interest back - and it gives those wanting to borrow better rates.

The banking industry's been so dreadful due to idiot liberals mucking with it... it might be time.

[LomanBill]

[And it wouldn't be by listening to the populist luddites and their finance hating crap.]

 

Ah, but a Republic is a system of government, characterized by the rule of Law.

 

We Ideological Luddite Republi-proles simply want the law to be enforced; rather than our (alleged) law-makers rewarding criminal activity.

 

Is that "hating finance"? No. We don't hate finance - we just don't like criminals who hijack our financial systems for criminal use; criminal use such as falsifying FICO scores.

 

Me thinks thou dost protest too much, comrade Jason.  Are you SURE you've never worked in/for the financial industry?

[Ilya Mourometz]

I agree that the warrants requirement is stupid. A lot of people were calling for it, but that’s the most “socialist” part of the whole plan, which I didn’t feel was otherwise. The whole thing is starting to look like a disaster; I still have mixed feelings about the bailout/buyout, but the execution so far is non-existent. By the time they do anything, it will either be too late or the markets will prove that it wouldn’t have mattered anyway.

[JasonC]

You are high and you are in denial. The modern world requires modern finance or standards of living fall by half. You are simply going to have to pay for the services of capital. Dragged to it kicking and screaming, I don't care.

[JasonC]

See, commies only have the ad hominem slander. I work in software, commie. I just have that chivalrous conservative bone in my head that hates with burning hellfire passion the wretched ingratitude of the left and all its acolytes, and will not stand still and watch decent men be dumped on and kicked while they are down, by the likes of you.

[JasonC]

The staffers pencilling it in were thinking of the whole things as AIG writ large. They thought it was clever, that they learned something reading the business page articles on the AIG liquidation. They never understood the original intent of the Paulson plan at all. The biggest howler in the entire bill, though, was that beautiful line that says, if the company goes bankrupt anyway after being helped, then the warrant automatically converts into senior debt. lol. They actually wrote that. You can just see the dorm room bull session back and forth that came up with that one. Utter illiterates playing stupid games with word-tokens they don't remotely understand.

The Treasury simply has to finesse all the crap the congress wrote into the bill. Here is a warrant for 1% of a company formed last week that just bought a bunch of MBS paper from Citigroup...

[LomanBill]

[No amount of spite, smearing, false allegations, show trials or hatred, will reduce the amount you are going to pay by one penny.]

 

That's what you think, comrade Guido.   We'll see how much blood you can squeeze out of the turnip once all those subprime 1s go "poof" and turn into 0s.

 

Don't look now Mr. Wizard, but Atlas is shrugging - and sharpening up his pitch fork.

 

[You are up against not a line or an opinion, but a law of physics,]

 

Economics, not physics.   You're in the wrong part of the ivory tower.   Better check your coordinates, comrade Professor.

 

 

 

BTW  Jason, my God doesn't need falsified FICO scores and a bailout to prop up His hierarchy.

 

Why does yours?

 

[Petronski]

How are boiled shoe leather futures holding up?

I plan to spend the winter dining on Kossack saddles....just like back in the good old days during Barbarossa.

[JasonC]

Atlas is a capitalist, and the shrug is the demand for 20% before lending to a bank, while the authorities play "minute of hate" instead of paying the frack up.

The authorities will pay up. And you with them.

[wafflehouse]

wtf over

[wafflehouse]

what if we just decide we hate criminals; criminals who abuse the tool of capitalism, instead?

i hope you are referring to CONGRESS with this post

[Ilya Mourometz]

Can’t Treasury waive the warrants? They aren’t required are they; they weren’t in the Son of Paulson version that failed in the House. As I recall then, the warrants were an option that Treasury could take. I haven’t read the monster of a bill that came out in the Senate.

That said, I am still not clear on whether a bank/institution has any choice if Treasury comes to them and demands they turn over the MBSs (which I assume are mostly, if not entirely CDOs, right?). If that’s the case, and the warrants are still on the table, then even if they are not required by Treasury, the threat will be hanging on everyone like a lead weight.

[LomanBill]

[decent men be dumped on and kicked while they are down, by the likes of you.]

Decent men falsify FICO scores, bundle up the loans bearing those falsified scores into securitized packagages (CDOs) - and then foist them off on folk's retirement plans?

Those decent men?

[I work in software,]

So I've seen you say before.

 

I just wanted confirmation  from your own lips,  for the benefit of the lurking peanut gallery, that YOU, JASONC, HAVE NEVER WORKED IN THE FINANCE INDUSTRY.

 

LOL.

 

There it is ladies and gentlemen of the jury - Quisling Comrade JasonC, the self proclaimed Conservative Defender of Capitalism - has never worked in the finance industry.

 

So is it any wonder then, that his vociferous postings reflect gross ignorance of, even denial of, the systemically corrupt nature of the pirated finance industry; the industry pirated by Obama's Marxists?

 

No, it is not.  

 

Your ignorance is, perhaps, understandable Jason;  but your continual emphatic denial of the observable fact - that your precious golden calf has been hijacked by criminals.   No, that denial is very interesting.

 

[LomanBill]

>>Atlas is a capitalist,

 

Atlas is an Individualist.

 

As was another of Rand's characters - Howard Roark.

 

"Who is society?  We are.   Man can be permitted to exist only in order to serve others - he must be a tool for the satisfaction of their needs; self-sacrifice is the law of our age.  The man who refuses to submit and to serve, Howard Roark, the supreme egoist, is a man who must be destroyed."

--Ellsworth Toohey 

 

You really bring the role of Ellsworth Toohey to life for us here in the theatre of FR, JasonC - bravo.

 

 

No, Mr. Toohey, your Marxist "Capitalists" are collectivist wolves in sheep's clothing; wolves who would enslave the Individual through debt, and who would destroy the Individual via the tyranny of their own appetite - all for the benefit of the collectivist hive.

 

 

The pyramid that you and Ellsworth Toohey worship is upside down, Jason; and so ill-configured, when the Pyramid is inverted - that's no longer Capitalism, it's just good ol' Fascist Collectivism.

 

In Biblical times, it was called Baal worship; effectively the worship of the structure of governance - notably symbolized by the Golden Calf in Exodus:

 

Ex 32:2-4

 

2 Aaron answered them, "Take off the gold earrings that your wives, your sons and your daughters are wearing, and bring them to me." 3 So all the people took off their earrings and brought them to Aaron. 4 He took what they handed him and made it into an idol cast in the shape of a calf, fashioning it with a tool. Then they said, "These are your gods , O Israel, who brought you up out of Egypt."
NIV

 

 

 

 

[LomanBill]

>>i hope you are referring to CONGRESS with this post

Did congress falsify FICO scores?

[Old Professer]

“Quis custodiet ipsos custodes? ...”

[LomanBill]

[Bondholders are on strike and your Fed can be the only provider of bank credit there is.]

 

Hmmm there it is again:  "your"

 

Your Fed...
Your Jefferson...

 

Are you an American Citizen, comrade Jason?  Even an American Resident?

[marshmallow]

When the debt of a bank is a worthless certificate of confiscation because the authorities, under populist pressure, just decide so, then the Fed gets to provide all the bank capital there is going to be.

When I read your rants, I feel like Alice in Wonderland, Through the Looking Glass. Everything appears backwards.

They're permeated by words like "hatred", "populist pressure", "populist luddites", "populist jerks". In your world, honest people who pay their bills, play by the rules and expect others to do the same are "jerks" and "luddites"? You're delusional. Those poor financiers and bankers! So put upon and persecuted! Who'd want to be in such a thankless and unprofitable line of work? I mean, these men are martyrs.

As if that isn't enough you peddle this shtick about government's actions being dictated solely by a desire to appease the populace when the truth is the exact opposite. Right through this fiasco they've riddden roughshod over popular sentiment which is overwhelmingly against the bailout.

If you want a safe bet, here's one. When this all shakes down and we get to sift through the ashes of this debacle, some of your beloved bankers are going to be indicted, convicted and sent to the pokey for their role in this scam and it won't be to appease "the populace". It will be for fraud, making false affidavits and theft.

[headsonpikes]

Sure, the wheel is crooked, but it’s the only game in town!

Do not expect perfection in this life. If you think the greedy bankers and brokers are contemptible , you really ought to take a look at the legislatures crafting the legislation regulating these businesses and the judiciary that enforces those statutes.

No natural justice here - just positive law, the servant of ideology.

The GD lawyers chasing bent bankers are not going to save the economy - they’re the GD commissars of American-style socialism.

[roamer_1]

If your stick isn't repossessed by the Stick And Loan.

Stick shtick... Nice.