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Troubled assets, and their consolers

By Michael J. Smith on Monday February 9, 2009 07:01 PM

Owen will grouse, no doubt, but my fellow New Yorker Doug Henwood has some cogent stuff to say:

Tomorrow will bring the unveiling of the Obama administration’s overhaul of the Henry “Hank” Paulson bank bailout, the Troubled Asset Relief Program (TARP)..... [I]t looks like a significant portion of the scheme will amount to this: the government will lend money to hedge funds and the like at subsidized rates to buy toxic assets from banks - and the gov will guarantee the investors against losses. Evidently, the administration thinks the toxic assets are being underpriced by the markets. If they’re right, the buyers will make money. If they’re wrong, then we all pay.

From the hedgies' point of view, it’s all reward, no risk... What the public gets out of this is impossible to specify, aside from the risk of massive losses.

I hope this isn’t really what will emerge. But if it is, the Obama administration will have broken new ground in awfulness. The same formula that brought us this mess... will be applied towards solving it....

Hedge funders like Chicago’s Kenneth Griffin wrote Obama big checks during the campaign season.... Obama’s top economic advisor, Larry Summers, worked for a hedge fund (D.E. Shaw) after he got fired from Harvard. And no doubt Treasury Secretary Tim Geithner would like a multimillion dollar job on Wall Street after he leaves public service, just like Robert Rubin got at Citigroup after engineering the repeal of Glass-Steagall.

Can things really be this bad?

From Doug, of course, this is what they call a rhetorical question.

Comments (3)


grouse at the hen ???

ya ..but not while she's
just laying her eggs

only when they hatch out lead ....

this is scoop journalism
the hen has sources on the street ????

i sure don't

his point i take it
uncle sap once again
ready to bank roll
the heroic risk takers de jour
and if not out right insure em agin
private loses
at least re asure em
any "major" private loses
will be considered
a national emergency
like last fall
and if the mark majority
tumble to the rumble ???

fuck em its two years to elections

nixons lemma
enough of the people enough of the time

what's so wronnnngah with that
its hide the pea time anyway eh ???

if two walnut shells aren't enough
dazzle the as hole toothless public
three four more ...shells

of course the trick all along
is ...
the pea gets palmed at step one

Al Schumann:

It's going to be a tough two years for the Democrats. What I'd suggest is that they start really cranking up the beautiful losing, and keep trying to blame the Republicans, until people grow so heartily sick of them that they elect a Republican majority out of hatred and spite. Then Obama can really get busy.


Amazing, isn't it, how smooth the whole operation has been! It's taken almost forty years, but finally they've moved the seat of government out of Washington entirely, and back to New York where it should have been all along.

Sure, they left the two-party system in Washington -- what a brilliant stroke! -- so the people still believe they have the power.

Vive le roi!

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