THE GATHERING STORM
Posted on 09/22/2009 7:25:17 AM PDT by SeekAndFind
Tired of the government bailing out banks? Get ready for this: officials may soon ask banks to bail out the government.
Senior regulators say they are seriously considering a plan to have the nation’s healthy banks lend billions of dollars to rescue the insurance fund that protects bank depositors. That would enable the fund, which is rapidly running out of money because of a wave of bank failures, to continue to rescue the sickest banks.
The plan, strongly supported by bankers and their lobbyists, would be a major reversal of fortune.
A hallmark of the financial crisis has been the decision by successive administrations over the last year to lend hundreds of billions of taxpayer dollars to large and small banks.
“It’s a nice irony,” said Karen Shaw Petrou, managing partner of Federal Financial Analytics, a consulting company. “Like so much of this crisis, this is an issue that involves the least worst options.”
Bankers and their lobbyists like the idea because it is more attractive than the alternatives: yet another across-the-board emergency assessment on them, or tapping an existing $100 billion credit line to the Treasury.
The Federal Deposit Insurance Corporation, which oversees the fund, is said to be reluctant to use its authority to borrow from the Treasury.
Under the law, the F.D.I.C. would not need permission from the Treasury to tap into a credit line of up to $100 billion. But such a step is said to be unpalatable to Sheila C. Bair, the agency chairwoman whose relations with the Treasury secretary, Timothy F. Geithner, have been strained.
“Sheila Bair would take bamboo shoots under her nails before going to Tim Geithner and the Treasury for help,” said Camden R. Fine, president of the Independent Community Bankers. “She’d do just about anything before going there.”
(Excerpt) Read more at nytimes.com ...
Tell me if I have this right in my head...
We lend the banks money (from our taxes) via the .gov so they won’t go belly-up. Too many of them do, and FDIC might go belly-up. So, the .gov wants the banks who haven’t gone belly-up to take our savings (which we already paid taxes on) and give it to FDIC, so they can bail out more belly-up banks?
Who is being reamed wrongfully here?
As of Friday August 14, 2009, FDIC is Bankrupt
http://globaleconomicanalysis.blogspot.com/2009/08/as-of-friday-august-14-2009-fdic-is.html
I had to read what you said twice...
At first read I thought naaah that’s not how it is but on second read. Yes, it is, accept they take our checking -and- savings accounts.
But this would cause utter choas so they HAVE to honor the FDIC limit in all our accounts. Besides... they only like to take our money only once a year on April 15th. So bottom line the government will take total control of all banks and maybe roll them into this bank
It’s the largest shell game in history.
Does this mean that bankers can fire the CEO of the Federal Government? Fair’s fair, after all.
Good catch,,,
Sure seems like Bankrupt fits...
I DO like the way you think!
I wouldn’t trust her to be a town dogcatcher, let alone, running the FDIC.
I took all mine out to buy alcohol.
I am about to do the same, Mad Tom.
That’s about all we thinking people can do if Obama is going to imitate the Soviet Union. Join them in the vodka consumption so we don’t have to think about it any more.
Yep. A Liberty safe with the highest fire-rating we could afford.
We paid off every debt we had, house included, then put the rest in the safe.
We also bought a little gold & silver last year....and some bullets and toilet paper. :)
..”you get to do alot of target practice and won’t need to buy toilet paper for awhile.”
And who can say we’re not positive about the Obombmination?
“..pow, pow, . . wipe, wipe!”
I just spewed a diet coke all over my computer screen....LMAO!!!!!!!
The left’s answer to failed policies is the same failed policies. Heck, they don’t even come with new failed policies.
Denninger has a pretty good take on this one:
http://market-ticker.denninger.net/archives/1456-CORRUPTION-Reverse-Insurance!-FDIC.html
401K.
More and more insanity. WHEN will it stop, and what will it take to stop these blatantly unconstitutional “solutions” to a mess the gov’t CREATED in the first place by forcing banks to MAKE the bad loans!
Robbing Peter, to pay Paul, and John Q. Public gets the bill in more ways than one!
To All:
Bankrate.com
Left side to Safe & Sound Ratings “Is your bank safe?”
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