U.S. Seeks Expanded Power to Seize Firms

[mash107]

They are fascists, not communists. The reality will sink in too late.

What is the difference? Communism is Socialism is Fascism. Complete government control of your life.

 

[Annie]

They are fascists, not communists. The reality will sink in too late.

What is the difference? Communism is Socialism is Fascism. Complete government control of your life.

At the top and what is 'demanded' of the masses. There are differences and dangers in each.

 

[Gunny]

They are fascists, not communists. The reality will sink in too late.

What is the difference? Communism is Socialism is Fascism. Complete government control of your life.

Moderation is the best way to keep government control out of your life. These financial institutions were too greedy and allowed to run unchecked for too long, when some moderate control could have precluded them getting so big the government HAS TO step in.

AIG is big enough to screw up the world's economy if it fails. Is it cheaper for the government to seize and run AIG, or keep bailing it out every 6 months?

The fact is, AIG is at fault for allowing itself to get into this position, and give the government an excuse.

 

[Toro]

Here is the problem.

We have allowed these institutions to become too big to fail. We have allowed these institutions to write unregulated financial contracts such that the notional amount totals many multiples of world GDP. We have allowed these institutions to make enormous bets based on implicit leverage that they never fully understood. We have allowed the financial system to get so massive that their failure imperils the economy in a frightening way.

In banking, the bargain is that we allow financial institutions to get levered up and supply credit to the economy, but if they fail, the government moves in and seizes the institution to prevent runs on the financial system. Depositors are protected by insurance administered by the government, with the taxpayer the ultimate backstop for the system. Thus, if you are going to be insured, the trade-off is that if you screw up, you are dead and the government owns you.

We have failed to stop the financial system from imperiling the nation. This is dead serious. Banks that had never been under the auspices of federal regulatory control have had to be bailed out by the Federal Reserve and the US Treasury, costing the US taxpayer hundreds of billions of dollars. They have been effectively seized and backstopped anyways, even though they did not submit themselves to the same level of regulation.

You want to repeat the Great Depression? Watch them tip over and smash the real economy around them. That's when you get a 30% contraction in GDP and 25% unemployment. Start letting these guys fail like dominoes. It was the failure of thousands of banks more than anything that pushed the economy into The Great Depression.

With nearly three-quarters of the credit flowing outside of the formal banking system, and it becoming very apparent that these institutions are too big to fail, seizing these institutions merely gives the government the same power it has over the formal banking system. If you are so big that your failure imperils the economy and you need to be bailed out by the US taxpayer, then you will be seized to protect the US taxpayer, just like a bank.

I don't disagree with your point. At the same time, there's too much danger inherent in giving the US Treasury Dept that much power.

I've been wondering when these dipshit politicians were going to wake up and realize corporations like AIG could wipe the world's economy if they failed, and posted as much a couple a weeks ago.

I would prefer to see the Treasury given case-by-by case authority to seize corporations that look like they are going to fail rather than blanket authority to seize whoever they say fits the bill.

The Dems are so big on oversight ... where is it here?

Yeah, I understand that. Ideally, the government wouldn't own anything.

However, the government already seizes banks and winds them down in an orderly fashion. The government already is seizing de facto control over financial companies outside of the regulatory framework. If we are going to do so anyways, its best to do so in an orderly fashion so that everyone knows what the rules are. The government has been flying by the seat of its pants over the past year. This - ideally - implements an orderly and transparent process.

 

[PubliusInfinitum]

WOW... It's almost as if these people are implementing MARXIST Policy! Which would be rather odd for those that SOME have claimed are not Marxists...

Who could have EVER foreseen that the US government would be looking for the power to seize the means of production?

I mean, to KNOW THAT... One would almost have to KNOW that those with life long histories of Marxist advocacies can be expected to implement Marxist policy upon the assention to power!


That's just CRAZY MAN!

WOW. Idiot. The government seizing free enterprise is not solely a tenet of Marxism, so STFU, huh? The Democrats being dumbasses doesn't make you right, nor less of a dumbass.

ROFLMNAO... Oh GOD that's precious!

What a LOVELY demonstration of just HOW the US came from defeating the Communist in the 1980s to ELECTING a Communist only 20 years later.

Go ahead Gunny... explain who it is that the Marxist Muslim is actually a Right winger...

 

[Gunny]

Here is the problem.

We have allowed these institutions to become too big to fail. We have allowed these institutions to write unregulated financial contracts such that the notional amount totals many multiples of world GDP. We have allowed these institutions to make enormous bets based on implicit leverage that they never fully understood. We have allowed the financial system to get so massive that their failure imperils the economy in a frightening way.

In banking, the bargain is that we allow financial institutions to get levered up and supply credit to the economy, but if they fail, the government moves in and seizes the institution to prevent runs on the financial system. Depositors are protected by insurance administered by the government, with the taxpayer the ultimate backstop for the system. Thus, if you are going to be insured, the trade-off is that if you screw up, you are dead and the government owns you.

We have failed to stop the financial system from imperiling the nation. This is dead serious. Banks that had never been under the auspices of federal regulatory control have had to be bailed out by the Federal Reserve and the US Treasury, costing the US taxpayer hundreds of billions of dollars. They have been effectively seized and backstopped anyways, even though they did not submit themselves to the same level of regulation.

You want to repeat the Great Depression? Watch them tip over and smash the real economy around them. That's when you get a 30% contraction in GDP and 25% unemployment. Start letting these guys fail like dominoes. It was the failure of thousands of banks more than anything that pushed the economy into The Great Depression.

With nearly three-quarters of the credit flowing outside of the formal banking system, and it becoming very apparent that these institutions are too big to fail, seizing these institutions merely gives the government the same power it has over the formal banking system. If you are so big that your failure imperils the economy and you need to be bailed out by the US taxpayer, then you will be seized to protect the US taxpayer, just like a bank.

I don't disagree with your point. At the same time, there's too much danger inherent in giving the US Treasury Dept that much power.

I've been wondering when these dipshit politicians were going to wake up and realize corporations like AIG could wipe the world's economy if they failed, and posted as much a couple a weeks ago.

I would prefer to see the Treasury given case-by-by case authority to seize corporations that look like they are going to fail rather than blanket authority to seize whoever they say fits the bill.

The Dems are so big on oversight ... where is it here?

Yeah, I understand that. Ideally, the government wouldn't own anything.

However, the government already seizes banks and winds them down in an orderly fashion. The government already is seizing de facto control over financial companies outside of the regulatory framework. If we are going to do so anyways, its best to do so in an orderly fashion so that everyone knows what the rules are. The government has been flying by the seat of its pants over the past year. This - ideally - implements an orderly and transparent process.

As I stated, my problem with it is the blanket authority. I would prefer oversight on seizures. The lack of oversight is what created this mess to begin with.

 

[Gunny]

WOW... It's almost as if these people are implementing MARXIST Policy! Which would be rather odd for those that SOME have claimed are not Marxists...

Who could have EVER foreseen that the US government would be looking for the power to seize the means of production?

I mean, to KNOW THAT... One would almost have to KNOW that those with life long histories of Marxist advocacies can be expected to implement Marxist policy upon the assention to power!


That's just CRAZY MAN!

WOW. Idiot. The government seizing free enterprise is not solely a tenet of Marxism, so STFU, huh? The Democrats being dumbasses doesn't make you right, nor less of a dumbass.

ROFLMNAO... Oh GOD that's precious!

What a LOVELY demonstration of just HOW the US came from defeating the Communist in the 1980s to ELECTING a Communist only 20 years later.

Go ahead Gunny... explain who it is that the Marxist Muslim is actually a Right winger...

Did I say he was a rightwinger? Read my lips: N-O. Might take your mind a second to do the phonics, but I have faith in your feeble skills.

I stated the government seizing free enterprise is not solely a tenet of Marxism, dumbass. Try again.

While you're at it, if he says he's not a Muslim and went to a Christian church for over 20 years that we KNOW of, he's not a Muslim, either.

Go pound sand bitch. I'd suggest you get your bumblebee ass and alligator mouth off my radar screen.

 

[del]

It's okay. They aren't listening to suspected terrorists phone calls so it's not a violation of anyone's rights.

i was worried for a minute, but you put it in perspective for me.

Let's face it. I was giving Obama more than the benefit of doubt, but this is getting almost surreal.

Giving the Treasury the authority to seize basically whatever they deem economically vital? Translation: the government is going to take over AIG.

Is anyone actually LOOKING at WTF our government is doing?

i wasn't disagreeing with you.

from what i've seen so far, i'd say that mr obama has no more regard for the Constitution than the last guy, whatsisname. it seems to me that the proposal in the OP is, at best, the nose of the camel.

the patriot act has nothing on this, IMO.

 

[PubliusInfinitum]

They are fascists, not communists. The reality will sink in too late.

What is the difference? Communism is Socialism is Fascism. Complete government control of your life.

At the top and what is 'demanded' of the masses. There are differences and dangers in each.

Leftism doesn't just control the top.. it controls the whole. There are irrelavant distinctions... Left-think is a wholly invalid species of reasoning: ON THE WHOLE.

The entire ideology is comprised of NOTHING BUT A RATIONALIZATION TO MISDIRECT RESPONSIBILITY FOR THE FIALURE OF SOME TO NOT ACHEIVE THE PERCEIVED SUCCESS OF OTHERS.

Progressvism, which is fascism, is nothing but SOCIALISM with a national bent... It's a rationalization of socialism which allows for and takes advantage of the pride of nation. But it remains socialism in every conceivable way. It justifies socialist tenets... thus, a fascist or "Progressive" has accepted the would-be principles of socialism, they simply disagree with the degree to which socialist policy should be implemented.

A fascist believes in a 'blend of socialism and capitalism' or a 'mixed economy'... that Capitalism by itself is too HOT and Socialism by itself is too cool... but PROGRESSIVISM... (Fascism) is JUuuuuuuust right!

The problem is that where a culture accepts the principles of socialism it must reject the inherent rights and responsibilities of the individual... relegating the responsibility for ones well being to the State.

Just look at how hard the Gunny is trying to rationalize his intentive understanding that Nationalizing the means of production is wrong, he can't bring himself to simply take responsibility for himself and demand that others do the same damn thing. "Moderation" is the Key...

Well here's the thing... there's no such thing as moderate principles... they're either valid and true or they're WRONG... PERIOD.

Fascism is a means to an END... because socialism will always fail, and given that those who accept socialism are incapable of reason, the fascist culture will ALWAYS blame the failure on the CAPITALIST... and that means that every projected failure will cull away that capitalism which is projected as the problem... until ONE DAY... someone asks for the power for the Government to 'take control' of those failing capitalist assets and PRESTO! You're a fucking socialist...

But it doesn't stop there... because socialism FAILS... and where it fails the socialist will NEVER admit that it was the socialism that failed... so the failure HAS to be where? It has to be ANYWHERE that the State was not in complete control... which means the State must take measures to apply MORE CONTROL! And PRESTO, you're a fuckin' Communist.

Now the bad news is that up until NOW... those who were subjected to Communism could always look to the US as an alternative... as a symbol of hope. If we listen to the 'third way(ers)... whose only potential is to empower the left, by their lending ceaseless credence to leftist idiocy... always willing to meet them halfway; then the US and the unalienable rights of the individual; the beacon of Liberty... will be gone... and where in the hell are you going to go when that's gone?

 

[PubliusInfinitum]

Here is the problem.

We have allowed these institutions to become too big to fail. We have allowed these institutions to write unregulated financial contracts such that the notional amount totals many multiples of world GDP. We have allowed these institutions to make enormous bets based on implicit leverage that they never fully understood. We have allowed the financial system to get so massive that their failure imperils the economy in a frightening way.

In banking, the bargain is that we allow financial institutions to get levered up and supply credit to the economy, but if they fail, the government moves in and seizes the institution to prevent runs on the financial system. Depositors are protected by insurance administered by the government, with the taxpayer the ultimate backstop for the system. Thus, if you are going to be insured, the trade-off is that if you screw up, you are dead and the government owns you.

We have failed to stop the financial system from imperiling the nation. This is dead serious. Banks that had never been under the auspices of federal regulatory control have had to be bailed out by the Federal Reserve and the US Treasury, costing the US taxpayer hundreds of billions of dollars. They have been effectively seized and backstopped anyways, even though they did not submit themselves to the same level of regulation.

You want to repeat the Great Depression? Watch them tip over and smash the real economy around them. That's when you get a 30% contraction in GDP and 25% unemployment. Start letting these guys fail like dominoes. It was the failure of thousands of banks more than anything that pushed the economy into The Great Depression.

With nearly three-quarters of the credit flowing outside of the formal banking system, and it becoming very apparent that these institutions are too big to fail, seizing these institutions merely gives the government the same power it has over the formal banking system. If you are so big that your failure imperils the economy and you need to be bailed out by the US taxpayer, then you will be seized to protect the US taxpayer, just like a bank.

ROFLMNAO... You're right, at least to the degree that 'we' allowed the left to find power. We should have stopped it in the 1950s, by outlawing the CPUSA, declaring in finality and all certainty that socialism is antithetical to the bed-rock principles on which the US rests...

But your dead wrong with regard to the calamitous effects of a total failure of the banking system.

The Great Depression was what it was, NOT because of the failure of banks... but a function of the FAILURE OF GOVERNMENT TO KEEP IT SELF WITHIN CONSTITUTIONAL BOUNDARIES; TO STAY OUT OF THE PRIVATE MARKETS.

If the banking system fails it will fail BECAUSE of federal regulation, NOT due to a lack of it.

The Banks did not run, on their OWN, to violate prudent actuarial lending. THAT was a DIRECT result of abuse of power by LEFTIST LEGISLATORS who threatened that market with the full power of the Federal government, when it threatened to prosecute that industry through the BASTARDIZATION of ANY reasonable understanding of CIVIL RIGHTS laws, because prudent actuarial lending thresholds necessarily precluded many individuals which the left sought to use as political fodder.

 

[garyd]

The difference between a socialist and a Fascist is that a Faascist sees nothing wrong with Nationalism.

The difference between Marxism and the other two (Socialism and Fascism) is the latter two understand that any government big and intrusive enough to make any kind half way decent attempt at from each according to his means to each according to his needs isn't going anywhere of its own free will.

And the first freedom that dies under socialism is the freedom to find another job somewhere else if your current boss is too much of a prick since we all work for the government.

 

[Toro]

The Great Depression was what it was, NOT because of the failure of banks... but a function of the FAILURE OF GOVERNMENT TO KEEP IT SELF WITHIN CONSTITUTIONAL BOUNDARIES; TO STAY OUT OF THE PRIVATE MARKETS.

If the banking system fails it will fail BECAUSE of federal regulation, NOT due to a lack of it.

The Banks did not run, on their OWN, to violate prudent actuarial lending. THAT was a DIRECT result of abuse of power by LEFTIST LEGISLATORS who threatened that market with the full power of the Federal government, when it threatened to prosecute that industry through the BASTARDIZATION of ANY reasonable understanding of CIVIL RIGHTS laws, because prudent actuarial lending thresholds necessarily precluded many individuals which the left sought to use as political fodder.

This is not a serious argument. Polemic rants should be ignored.

Thousands of banks failed between 1929 and 1933. Banking regulation was light as banks speculated in the stock market with depositors' funds. This wasn't the only reason why banks failed - deflation in the commodity markets after the post-war boom ended probably was. However, the market induced their implosion for the most part, not regulators. This massive failure caused a tremendous credit contraction as a third of the banking reserves were drained from the system. The ratio of cash in circulation to deposits soared to all time highs as people were so afraid of bank runs, they would have rather kept their money in their mattresses than their deposit accounts. In fact, a Federal Reserve study concluded that banks that failed were in aggregate as sound or more so than banks did not. Ben Bernanke - the world's acknowledged foremost scholar on The Depression - concluded that the creation of the FDIC was the single most important factor in ending the Depression. Milton Friedman also highlighted the crucial importance of the FDIC in ending the Depression.

 

[PubliusInfinitum]

The Great Depression was what it was, NOT because of the failure of banks... but a function of the FAILURE OF GOVERNMENT TO KEEP IT SELF WITHIN CONSTITUTIONAL BOUNDARIES; TO STAY OUT OF THE PRIVATE MARKETS.

If the banking system fails it will fail BECAUSE of federal regulation, NOT due to a lack of it.

The Banks did not run, on their OWN, to violate prudent actuarial lending. THAT was a DIRECT result of abuse of power by LEFTIST LEGISLATORS who threatened that market with the full power of the Federal government, when it threatened to prosecute that industry through the BASTARDIZATION of ANY reasonable understanding of CIVIL RIGHTS laws, because prudent actuarial lending thresholds necessarily precluded many individuals which the left sought to use as political fodder.

This is not a serious argument. Polemic rants should be ignored.

Thousands of banks failed between 1929 and 1933. Banking regulation was light as banks speculated in the stock market with depositors' funds. This wasn't the only reason why banks failed - deflation in the commodity markets was the primary reason after the post-war boom ended probably was. However, the market induced their implosion for the most part., not regulators. This massive failure caused a tremendous credit contraction as a third of the banking reserves were drained from the system. The ratio of cash in circulation to deposits soared to all time highs as people were so afraid of bank runs, they would have rather kept their money in their mattresses than their deposit accounts. In fact, a Federal Reserve study concluded that banks that failed were in aggregate as sound or more so than banks did not. Ben Bernanke - the world's acknowledged foremost scholar on The Depression - concluded that the creation of the FDIC was the single most important factor in ending the Depression. Milton Friedman also highlighted the crucial importance of the FDIC in ending the Depression.

Hey.. Banks failed... GREAT! Who said anything to the contrary? That banks failed is a function of WHAT? Did the banks fail because they had sufficient reserves to meet the demands of their depositors?

I don't think they did... SO that means that the banks were operating without sufficient reserves to meet their liabilities.

Hmm... Now let's see... What entity of the US Government provided that Banks could operate with a FRACTIONAL percentage of their liabilities in reserve?

Hmm... Hey you're an empiricist... have you observed any history which provided for Fractional banking?

It seems I heard somethign about that... I believe what ever it was, was founded in 1913 by the first Academic President... who himself was a profound Advocate of Social Science... and created this institution to protect the economy...

What WAS the origin of Fractional banking which resulted in the failures of banks when they found themselves facing demand which shot beyond the scope of their fractional reserves?

Help a guy out here Big Fella!

 

[Ravi]

i was worried for a minute, but you put it in perspective for me.

Let's face it. I was giving Obama more than the benefit of doubt, but this is getting almost surreal.

Giving the Treasury the authority to seize basically whatever they deem economically vital? Translation: the government is going to take over AIG.

Is anyone actually LOOKING at WTF our government is doing?

i wasn't disagreeing with you.

from what i've seen so far, i'd say that mr obama has no more regard for the Constitution than the last guy, whatsisname. it seems to me that the proposal in the OP is, at best, the nose of the camel.

the patriot act has nothing on this, IMO.

I don't understand why you think the government taking control of failing financial institutions in order to clean them up is unconstitutional. They've done it with banks for longer than we've all been alive, why is this different in your view?

 

[Kevin_Kennedy]

Let's face it. I was giving Obama more than the benefit of doubt, but this is getting almost surreal.

Giving the Treasury the authority to seize basically whatever they deem economically vital? Translation: the government is going to take over AIG.

Is anyone actually LOOKING at WTF our government is doing?

i wasn't disagreeing with you.

from what i've seen so far, i'd say that mr obama has no more regard for the Constitution than the last guy, whatsisname. it seems to me that the proposal in the OP is, at best, the nose of the camel.

the patriot act has nothing on this, IMO.

I don't understand why you think the government taking control of failing financial institutions in order to clean them up is unconstitutional. They've done it with banks for longer than we've all been alive, why is this different in your view?

It's unconstitutional because the Constitution doesn't give authority to the federal government to take control of failing financial institutions.

 

[Ravi]

i wasn't disagreeing with you.

from what i've seen so far, i'd say that mr obama has no more regard for the Constitution than the last guy, whatsisname. it seems to me that the proposal in the OP is, at best, the nose of the camel.

the patriot act has nothing on this, IMO.

I don't understand why you think the government taking control of failing financial institutions in order to clean them up is unconstitutional. They've done it with banks for longer than we've all been alive, why is this different in your view?

It's unconstitutional because the Constitution doesn't give authority to the federal government to take control of failing financial institutions.

It also doesn't say they can't.

Does the constitution give authority to take control of failing banks?

 

[Kevin_Kennedy]

I don't understand why you think the government taking control of failing financial institutions in order to clean them up is unconstitutional. They've done it with banks for longer than we've all been alive, why is this different in your view?

It's unconstitutional because the Constitution doesn't give authority to the federal government to take control of failing financial institutions.

It also doesn't say they can't.

Does the constitution give authority to take control of failing banks?

That's not how the Constitution works. Only those powers stated in the Constitution are legitimate powers of the federal government.

No.

 

[FactFinder]

If you want capitalism you let the failures fail. If it brings down Wall St. So be it. Wall St. is not the productive force of America. Our dependence on it is no better than having a socialist government.

We do need a central market but an honest one that makes small fees on real and productive transactions not one that creates "castles in the sky" and pretends they are valuable.

 

[Ravi]

It's unconstitutional because the Constitution doesn't give authority to the federal government to take control of failing financial institutions.

It also doesn't say they can't.

Does the constitution give authority to take control of failing banks?

That's not how the Constitution works. Only those powers stated in the Constitution are legitimate powers of the federal government.

No.

I have a feeling we aren't going to agree on this. The federal government, imo, has a duty to provide for the general welfare of the country. Therefore they are within their rights to seize institutions that threaten the stability of the country until that time that they no longer pose a threat.

 

[FactFinder]

Oh as for the proposal for expanded powers for oversight. That may have some good in it but they want to pervert and weaken the FDIC in order to fund its operations.

The FDIC is the last line of defense for the individual.

Geitner states that he wants to honor contractual law when it comes ot exec bonuses yet is eager to pervert the purpose and obligations of the FDIC.

They have already weakened the FDIC by increasing it's exposure by 150%