Posted on 09/30/2008 6:53:14 PM PDT by maccaca
A group of House Republicans is cobbling together a proposal to stabilize financial markets that can serve as an alternative to the plan proposed by Treasury Secretary Henry Paulson, legislative sources have told CNBC.
The failure of Monday's vote on the $700 billion bailout package—which these Republicans doubt is likely to cause an economic "doomsday" scenario—emboldened the group to press forward with its own plan, sources said.
The group pressing the alternative plan is doing so for largely ideological reasons: They're opposed to the federal government taking a large role in financial markets, sources say.
Components of the alternative plan including the following, according to sources:
Require the Treasury Department to guarantee, at up to 100 percent, bank losses resulting from failed mortgage-backed securities originated prior to the plan's enactment. Such insurance, supporters say, would provide immediate value to the securities and a foundation for which they could then be sold. The Treasury Department would finance that insurance by assessing a premium on outstanding mortgage-backed securities.
Allow companies to carry back losses arising in tax years ending in 2007, 2008, or 2009 back five years, generating a tax refund and immediate capital
Allow a "repatriation window" for profits earned by U.S. firms overseas. Such repatriation amounts would not be taxed if invested in distressed debt (as defined by Treasury) for at least one year.
Allow banks to treat losses on shares of preferred stock in Fannie Mae and Freddie Mac as ordinary losses, not as capital losses
Suspend the capital gains tax rate for two years
Limit backing of high-risk loans by Fannie Mae and Freddie Mac
Schedule Fannie and Freddie for privatization
Suspend "mark-to-market" accounting until the SEC can issue new guidelines that will allow firms to mark these assets to their true economic value
Stabilize the dollar by repealing the Humphrey-Hawkins Full Employment Act, which alternative bailout supporters say diverts the Federal Reserve's attention from long-term price stability to short-term economic growth
...
Democrats might chafe at it, but if they don’t, Republicans aren’t doing their job.
“Suspend “mark-to-market” accounting until the SEC can issue new guidelines that will allow firms to mark these assets to their true economic value “
Best thing in the proposal.
I am FOR A Bailout, but not the one they are talking about now...
If ANY bailout is going to work, it must:
1) Address the ORIGINAL cause of the problem, being DEMOCRAT Class warfare INTERFERENCE in the Free Market Financial system (Fat chance, I know)
2) STOP giving mortages to people with little hope of ever paying back. No more “Interest Only” mortgages, Zero Down mortgages, etc...
3) The trigger for this was MASSIVE, MASSIVE mortgae in our inner-cities, on an unimagined scale. Almost ALL of it beniffitting Democrats, or Democrat-connected people. (Dare I say-MINORITIES?)
The Feds are prosecuting THOUSANDS for this right now, but if you listen to anyone but FOX, it’s all the fault of the “EVIL REPUBLICANS”
Thanks! That what I was thinking including some of the sky is falling around here crowd. The last bill needed to be shot down and this one looks better because the other one was tanked.
Great group!
great post at least there are a few other people out there that get it
BTTT
I am really worried about what Bush is doing. He looks totally paranoid.
As I understand it, the bill that will be voted on tomorrow doesn’t have the original pork. There are additional provisions from the “original revised” bill. (Extending FDIC protection from $100,000 to $250,000 for one).
And who the heck knows how he will vote? He’s not real predictable. And I don’t believe that everything that is said is true. Too much under the surface that we will never know, imo.
Thanks...I just hope that however he votes won’t create the “it’s over” panic we’ve seen lately. I’m praying for him. ;)
I know, and that makes me nervous. What has thrown him? Or who?
I think anyone presiding over an economy very close to spinning over the edge would be pretty paranoid.
Very few of us could hold up as well as the President has thru his various trials.
Sweet. House Republicans will be seen as doing the necessary cleaning up for the bill to be passed.
Well, this sounds a little better....
Looks reasonable....
Which is why it has a snowball’s chance of ever being passed!
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