Nationalize Insolvent Banks

[Dr.Dudd]

Re: BofA, White House Rebut Nationalization Fears

Don'tt tell me that those hounds that was at the throata od Russia,china and Venezuala, not to mention Cuba is recommendung <span style="font-weight: bold">nationalisation </span> in the sanctuary of the bastion of capitalism??
what is happening to the world?!?!
As I have been saying all thes eyears. It is not capitalism that is at fault. It is Reaganism, promoted as Reaganomics that gailed us.
This dumb belief that business should be left to regulate their affirs.
I remember the fisst time I heard it. I said ti muslf, Is this man serious&quot;??
Now the beginning of the results is staring us in the face

It is like allowing the gas station to check their own pumps to see if they are delivering the right of fuel to the customers.

Or allowing the banks to count your money and not check it,because you have no means of doing so.

It is not the banks that failed us. <span style="font-size: 14pt"> It is the so-called Reagan conservatives,and the policies that they promoted.</span>
Now they want to blame it on the banks, the victims of theor polocies and everybody else, but themselves. The banks did what any well thinking person know they woild have done. That is why they have auditors and the IRS?
They don't leave it to us to pay whateve taxes we want to,They have their means to check they we do.

[Tuff Gong]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">Don'tt tell me that those hounds that was at the throata od Russia,china and Venezuala, not to mention Cuba is recommendung <span style="font-weight: bold">nationalisation </span> in the sanctuary of the bastion of capitalism??
what is happening to the world?!?!
As I have been saying all thes eyears. It is not capitalism that is at fault. It is Reaganism, promoted as Reaganomics that gailed us.
This dumb belief that business should be left to regulate their affirs.
I remember the fisst time I heard it. I said ti muslf, Is this man serious&quot;??
Now the beginning of the results is staring us in the face

It is like allowing the gas station to check their own pumps to see if they are delivering the right of fuel to the customers.

Or allowing the banks to count your money and not check it,because you have no means of doing so.

It is not the banks that failed us. <span style="font-size: 14pt"> It is the so-called Reagan conservatives,and the policies that they promoted.</span>
Now they want to blame it on the banks, the victims of theor polocies and everybody else, but themselves. The banks did what any well thinking person know they woild have done. That is why they have auditors and the IRS?
They don't leave it to us to pay whateve taxes we want to,They have their means to check they we do.
</div></div>
When I see REThugh Leaders screaming for Nationalization but do not want to support the Stimulus Package and Federal Spending to jump-start the economy I raise the Red Flag.
Liberals such as Paul Krugman is saying that it good.... Well good for him I am glad the ReThugs went first, so when joe-the-dumber speaks about distributing the wealth he knows who to blame first.

[RichD]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">Don'tt tell me that those hounds that was at the throata od Russia,china and Venezuala, not to mention Cuba is recommendung <span style="font-weight: bold">nationalisation </span> in the sanctuary of the bastion of capitalism??
what is happening to the world?!?!
As I have been saying all thes eyears. It is not capitalism that is at fault. It is Reaganism, promoted as Reaganomics that gailed us.
This dumb belief that business should be left to regulate their affirs.
I remember the fisst time I heard it. I said ti muslf, Is this man serious&quot;??
Now the beginning of the results is staring us in the face

It is like allowing the gas station to check their own pumps to see if they are delivering the right of fuel to the customers.

Or allowing the banks to count your money and not check it,because you have no means of doing so.

It is not the banks that failed us. <span style="font-size: 14pt"> It is the so-called Reagan conservatives,and the policies that they promoted.</span>
Now they want to blame it on the banks, the victims of theor polocies and everybody else, but themselves. The banks did what any well thinking person know they woild have done. That is why they have auditors and the IRS?
They don't leave it to us to pay whateve taxes we want to,They have their means to check they we do.
</div></div>

ok so now how do you fix it?

[Tuff Gong]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: RichD</div><div class="ubbcode-body">ok so now how do you fix it? </div></div>

We know that one side is already out of the fixing part:

<a href="http://www.politico.com/news/stories/0209/19158.html" rel="nofollow" target="_blank"><span style="font-family: 'Arial Black'">Forget change:
GOP eyes retro strategy</span>
<span style="font-style: italic">By JEANNE CUMMINGS
2/23/09 4:31 AM EST </span></a>

<span style="font-family: 'Arial Black'">Republicans are hatching a political comeback by dusting off a strategic playbook written nearly two decades ago.</span>

Its themes: Unite against Democrats’ economic policy, block and counter health care reform and tar them with spending scandals.

Those represent the political trifecta that former House Speaker Newt Gingrich bet on in 1994 to produce a historic Republican takeover of Congress.

Now, some Republicans believe President Barack Obama’s one-two push on the economy and health care reform is setting the stage for a new round of significant gains, if not a total takeover.

“There are two models that Republicans are looking at,” said Grover Norquist, president of Americans for Tax Reform.

“One is 1990, [President George H.W.] Bush gets together with the Democrats at Andrews Air Force Base, raises taxes and loses the next election,” he explained. “The other is 1993, Democrats have a series of proposals to spend and tax. Republicans vote no and regain the House and Senate.”

[RichD]

Re: BofA, White House Rebut Nationalization Fears

<span style="font-weight: bold">We did it better than the US - Davies
</span>
By Steven Jackson

Sunday, February 22, 2009

Opposition spokes-man on finance Dr Omar Davies thinks his team did a better job to mitigate the 1990s financial crisis in Jamaica than the current actions of US President Barack Obama and his team.
Davies... I have not seen a clearly articulated objective for the intervention in the financial institutions

&quot;I was marginally involved, I took most of the cursing, but the technical groundwork that we put together for the intervention in the financial sector I would contend represents a superior effort than that which is taking place now in the US,&quot; said Davies, at a public lecture at the University of Technology in Kingston, last week.

The former Finance Minister's comments received claps and huffs.

Obama inherited an administration in crisis, Davies conceded, but his nearly US$1-trillion dollar stimulus package is inconsistent, bailing out some financial institutions but not others of similar size.

&quot;To date, I have not seen a clearly articulated objective for the intervention in the financial institutions. What you have is knee jerk reactions. Their underestimation [of bad debt] is even higher than in [Jamaica] because everyday you hear of another institution crashing,&quot; said Davies.

&quot;One of the problems is the initial commitment of being all things to all persons,&quot; he continued.

He argued that the US stimulus package will create a huge fiscal deficit and change the US debt profile for at least a decade.

In Jamaica, Davies argued that his team had explicit objectives of rescuing depositors and nationalising troubled institutions with the clear intention of reselling them. Finsac is the agency that the Government used to intervene in the sector, which cost an estimated $120 billion, or more than a third of GDP. But Davies said US intervention has &quot;no clear exit strategy&quot; to resell these newly nationalised institutions.

The US crisis has engulfed global markets and institutions, and Davies cautioned that Jamaica must not look to the developed world for policy formulations.

&quot;I assert that the technical capacity to develop appropriate policy responses exist nationally, while we will be open to external support and advice from abroad, the lack of clarity and consistency of intervention in the most advanced countries should become a clear demonstration that our tendency to assume that a superior formula exists elsewhere, (is flawed),&quot; argued Davies, who was finance minister from 1994 to 2007.

[Dr.Dudd]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: RichD</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">Don'tt tell me that those hounds that was at the throata od Russia,china and Venezuala, not to mention Cuba is recommendung <span style="font-weight: bold">nationalisation </span> in the sanctuary of the bastion of capitalism??
what is happening to the world?!?!
As I have been saying all thes eyears. It is not capitalism that is at fault. It is Reaganism, promoted as Reaganomics that gailed us.
This dumb belief that business should be left to regulate their affirs.
I remember the fisst time I heard it. I said ti muslf, Is this man serious&quot;??
Now the beginning of the results is staring us in the face

It is like allowing the gas station to check their own pumps to see if they are delivering the right of fuel to the customers.

Or allowing the banks to count your money and not check it,because you have no means of doing so.

It is not the banks that failed us. <span style="font-size: 14pt"> It is the so-called Reagan conservatives,and the policies that they promoted.</span>
Now they want to blame it on the banks, the victims of theor polocies and everybody else, but themselves. The banks did what any well thinking person know they woild have done. That is why they have auditors and the IRS?
They don't leave it to us to pay whateve taxes we want to,They have their means to check they we do.
</div></div>

ok so now how do you fix it? </div></div>How I fix what?? since i know that I have laid out the strategy many times before anbd it does not change. It is the same as I've suggested before. It does not change with every new discoveries.
since these new discoveries are nothing but the normal progression of the probem.
they are only new to those who do not understand the principles governing economics.

[Dr.Dudd]

Re: BofA, White House Rebut Nationalization Fears

Apples and oranges. mountain and molehill. nothing to compare

[Tropicana]

Re: BofA, White House Rebut Nationalization Fears

Americans are going to have no choice but to nationallize some of those banks. Don't know why onoo so terrified. Look at what happens when the banks receive the aid money directly. They blow it and there is nothing to show for it. Now if there was something equivalent to the Business Development bank of Canada, this money could be given directly to businesses. It wouldn't go to pay HUGE executive salaries, bonuses and for limos and fancy trips.

[RichD]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">How I fix what?? since i know that I have laid out the strategy many times before anbd it does not change. It is the same as I've suggested before. It does not change with every new discoveries.
since these new discoveries are nothing but the normal progression of the probem.
they are only new to those who do not understand the principles governing economics. </div></div> how to fix the immediate problem with the banks being insolvent....correct me if i have misunderstood you ....you have laid out principles for going forward but before going forward something has to be done about the immediate problem with the banks.

[Dr.Dudd]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: RichD</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">How I fix what?? since i know that I have laid out the strategy many times before anbd it does not change. It is the same as I've suggested before. It does not change with every new discoveries.
since these new discoveries are nothing but the normal progression of the probem.
they are only new to those who do not understand the principles governing economics. </div></div> how to fix the immediate problem with the banks being insolvent....correct me if i have misunderstood you ....you have laid out principles for going forward but before going forward something has to be done about the immediate problem with the banks. </div></div> Government buy tradable shares in the banks. that will attract investors. since the the investors know that th eonly way fpor the banks will be up. so there investment wull lukely make profit. bank capitalozation improve and allow them to make loans. Now making the loans will be much more problematioc than many think. that is because with the layoff being almost emmoinent. People will not be willong to make durabel pyrchases. That is irrespective ofhow much taxes is returned to them. Unlike the repibs claim. irrespective of ho mich taxez is reduced to people wjo jave no job secirity plus no possibillity of getting one of theu loose it. they will not spend and without that,the economy will be still on a mire.
One more time repeating myself.

[RichD]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body"> <span style="font-weight: bold">Government buy tradable shares in the banks. that will attract investors.</span> since the the investors know that th eonly way fpor the banks will be up. so there investment wull lukely make profit. bank capitalozation improve and allow them to make loans. Now making the loans will be much more problematioc than many think. that is because with the layoff being almost emmoinent. People will not be willong to make durabel pyrchases. That is irrespective ofhow much taxes is returned to them. Unlike the repibs claim. irrespective of ho mich taxez is reduced to people wjo jave no job secirity plus no possibillity of getting one of theu loose it. they will not spend and without that,the economy will be still on a mire.
One more time repeating myself. </div></div>

well today they have doen that ..so we should see some upward movement ...not sure how this is going to effect the balance sheet though. and how does this affect the thousands of smaller banks facing insolvency.

[Tuff Gong]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: RichD</div><div class="ubbcode-body"><span style="font-weight: bold">We did it better than the US - Davies
</span>
By Steven Jackson

Sunday, February 22, 2009 </div></div>LOL!

[Dr.Dudd]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: RichD</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body"> <span style="font-weight: bold">Government buy tradable shares in the banks. that will attract investors.</span> since the the investors know that th eonly way fpor the banks will be up. so there investment wull lukely make profit. bank capitalozation improve and allow them to make loans. Now making the loans will be much more problematioc than many think. that is because with the layoff being almost emmoinent. People will not be willong to make durabel pyrchases. That is irrespective ofhow much taxes is returned to them. Unlike the repibs claim. irrespective of ho mich taxez is reduced to people wjo jave no job secirity plus no possibillity of getting one of theu loose it. they will not spend and without that,the economy will be still on a mire.
One more time repeating myself. </div></div>

well today they have doen that ..so we should see some upward movement ...not sure how this is going to effect the balance sheet though. and how does this affect the thousands of smaller banks facing insolvency. </div></div>It will positively improve the situation with smaller banks too.
Unsolvency is really a matter of perception. If the system trust an institution it will evolve out of it's predictament. As the bigger banks start improviung and loans atart issuing again. they will earn and ther will be an improvement in deposits,which will affect smaller banks.

[RichD]

Re: BofA, White House Rebut Nationalization Fears

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Dr.Dudd</div><div class="ubbcode-body">
Unsolvency is really a matter of perception. </div></div> how so ?

[evanovitch]

Government vows to shore up banking system

<span style="font-weight: bold">Obama administration trying to avoid bank nationalizations</span>



updated 28 minutes ago
NEW YORK - Federal regulators said Monday they will launch a revamped program to shore up the nation's troubled banks that includes the option of increasing government ownership in financial institutions.

The new plans are the Obama administration's latest attempt to bolster the strength of the banking system without nationalizing any institutions, which the White House has said it does not intend to do.

The Treasury Department, Federal Deposit Insurance Corp., Office of the Comptroller of the Currency, Office of Thrift Supervision and the Federal Reserve jointly issued the statement amid growing concern that some of the country's biggest banks may need additional assistance to survive the fallout from the worst financial crisis since the 1930s.

<span style="font-weight: bold">The new program</span> — a crucial component of President Barack Obama's strategy for handling the $700 billion financial bailout — would give the government greater flexibility in dealing with troubled banks.
<span style="font-weight: bold">
In a new twist,</span> regulators have the option of allowing the government to boost its ownership in banks without having to pour more taxpayer money into them. That would be done through a technical change converting the status of the government's shares in a financial institution.

Citigroup Inc. has approached banking regulators about ways the government could help strengthen the bank, including the stock conversion plan, according to people familiar with the discussions. They spoke on condition of anonymity because they are not authorized to speak on behalf of the government or the company. A Citigroup spokesman declined to comment Monday afternoon.

Still, the regulators suggested keeping banks private is a priority.

&quot;Because our economy functions better when financial institutions are well managed in the private sector, the strong presumption (of the program) is that banks should remain in private hands,&quot; the regulators said.

The new federal program, like the old one, will allow the government to continue to inject more taxpayer money, or capital, into a bank, in an effort to ride out the financial storm. Of the first $350 billion in bailout funds, $250 billion was used to provide capital injections to banks, including Citigroup, Bank of America Corp. and others. But the Obama administration has not said how much of the second $350 billion will be used for that purpose.

The regulators on Monday did not name any specific banks or respond to reports that the government was considering increasing its ownership of Citigroup.

<span style="font-weight: bold">The White House just last week downplayed</span> persistent speculation that some banks could be effectively nationalized by the federal government.

&quot;A strong, resilient financial system is necessary to facilitate a broad and sustainable economic recovery,&quot; the regulators said. &quot;The U.S. government stands firmly behind the banking system during this period of financial strain to ensure it will be able to perform its key function of providing credit to households and businesses.&quot;

A revamped program, announced by Treasury Secretary Timothy Geithner earlier this month, to plow federal money into banks in return for giving the government ownership stakes will start Wednesday.

Regulators provided some details on that program Monday.

<span style="font-weight: bold">&quot;Any government capital will be in the form of mandatory convertible preferred shares, which would be converted into common equity shares only as needed over time to keep banks in a well-capitalized position and can be retired under improved financial conditions before the conversion becomes mandatory</span>,&quot; the regulators said.

Such a conversion into common stock would give the federal government more control of a bank — without necessarily having to put up more taxpayers' dollars and could be applied retroactively to banks that already have received billions in capital injections. The banks also benefit because preferred shares pay higher dividends so converting them into common shares will help ease their repayment burden.

Such an option is being considered for Citigroup but also could be available for other banks as well, according to people familiar with the new capital injection program. They spoke on condition of anonymity because they are not authorized to speak for the government.

When asked about reports that the government was considering increasing its ownership of Citigroup, Treasury spokesman Isaac Baker said the department did not comment on conversations with specific banks.

&quot;We've made clear that we will do what is necessary to strengthen and stabilize the financial system so that it can provide the credit necessary to support economic recovery,&quot; Baker said in a statement.


The government is open to considering a request to convert preferred shares purchased as part of its $700 billion rescue program into common stock &quot;if the institution and its regulator believe it would promote the long term stability of that institution and we believe it's in the best interest of long term stability of our economy and financial system,&quot; Baker said.

The Wall Street Journal reported late Sunday that Citigroup was in talks with federal officials over the possibility of the government expanding its ownership of the struggling bank to as much as 40 percent of its common stock. The newspaper said bank executives hope the stake will be closer to 25 percent.

Shares of Citigroup added 18 cents, or 9.2 percent, to $2.13 in Monday afternoon trading. The New York company's stock has traded between $1.61 and $27.35 in the past year.


<span style="font-weight: bold">The new capital injection program will require banks to under go &quot;stress tests&quot; to examine their financial health and determine whether additional capital is needed</span>.<span style="font-style: italic"> Details on how these tests will work may be provided Wednesday,</span> the people familiar with the plan said.

&quot;Currently, the major U.S. banking institutions have capital in excess of the amounts required to be considered well capitalized,&quot; the regulators said. However, as part of the stress tests, banking examiners will be looking closely at both the quality and quantity of capital.

Also Monday, Geithner will join Obama and other guests at a fiscal responsibility summit at the White House to discuss how to curb a burgeoning federal deficit laden with Social Security, Medicare and Medicaid obligations.