Paulson Admits what we all already knew - Bailing out the Bailout
Last week Secretary Henry Paulson announced that he was bailing on his original bailout plan, which was to purchase the troubled mortgage-backed assets from banks in an effort to clean up bank's balance sheets. It was not working he claims, but failed to mention that was the only program he floated before the Congress back before the October 3rd passage. So instead of purchasing assets, Paulson now is increasing the pace of outright purchases of bank stock. The Bailout Bill has no restrictions on how, or where, Paulson spends that money. The "American Taxpayer" now owns a proverbial "boat load" of banking concerns.
"But these are investments! The American Taxpayer will get its money back!" you have heard the pundits and government spokespersons promise. Really? When, or if, the US Government starts to sell our stakes in the banking industry will they be sending out checks that represent each American's "share" of the proceeds? Will the cut taxes for all American's to offset the investment? I don't think so. At best we will see the money rolled into some new program or handout. At worse we will be told the program never produced the revenues anticipated and will in stead require additional patriotic sacrifice in the form of a new tax or levy.
My point, when Chrysler paid back their bail out loans, did you get a check?
If you remember we initially allocated $125 Billion to nine of America's biggest banking concerns, which was used to infuse them with cash in exchange for preferred stock. Now they have upped that to $158.56 Billion dollars. The largest stock purchase so fare was $6.6 Billion paid to U.S. Bancorp of Minneapolis and the smallest has been $9 million paid out to a Los Angeles bank: Broadway Financial Corp. There are 6,300 institutions who have applied for "relief" so far. Amazing...
This morning onFBN we learned that Paulson has agreed to put aside $350 Billion for the Obama administration to dole out after his January 20th inauguration. So as Barney Frank, the disgrace of the House, sits and grills the Secretary today, watch for grandstanding and bullying that will produced no new jobs, no new opportunity and nothing but cheap meaningless photo opps. The market has fallen since the "urgent" need for $700 Billion was extorted from the taxpayers. Foreclosures have accellerated, jobs continue to be lost and the government keeps promising a solution. Each solution takes us a step closer to European Socialism with no real end game in sight.
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