As I have posted before, if I make bad decisions on my farm and I need money, for a failed operation, there is no bail out. I line up the machinery and the BK sale begins
Well it doesn't work this way for Wall St.
The Fed along with the gov't stimulas plans, have morre ways to put money into a failed operation than Carter has pills
This is the latest scheme. One of many
Primary dealers [who ever that may be???] have made some very bad bets in the market. They have assets which are way under water. Well the Fed in a fancy way of saying the monetary system has to be liquid, and fully funded to find market value or some kind of gibberish to make us think the Fed will save the day
So:: The Fed will buy these assets, at what value I do not know but the idea is to make the primary dealers whole, with cash from the Fed. Unlimited cash
Now the people that made these bets, bought assets including stks, corp bonds, junk bonds you name it, all on a rising market. They made huge bonuses for upward of ten yrs. Then the rug got pulled out and they lost money hand over fist
But never fear as the Fed will take the bonds of any Co. if it has cash flow or not, stks at par value and unlimited funds to keep the primary dealers playing in the Vegas of all markets betting as if Black Jack. Never fear because the Fed stands ready with unlimited funds to keep them whole, if they lose on a couple of twos, a 6 and seven or what ever the bet may be
Now doesn't it seem a bit unfair that these folks made bets and won on a rising market for yrs. And yes, made bonuses for yrs. How could they lose. Many of them had never seen a losing yr. Now that the bet has gone sour, the Fed is there to bail them out
I have used lay mans terms mostly because I can't remember all the hanky panky the Fed is doing, but trust me what I am telling you is as real as the sun will come up tomorrow. Would you like a money bag that never goes empty???
Why do we allow the Fed to do this. Congress has to approve of this and they have approved the bailout
I posted that when the dust settles the deficit will be 30 trillion
If the Fed and congress continue on this path of bail outs, 30 trillion may be much to low. We will hit 25 trillion in a blink of an eye. so hang on.
I know you may not understaand or you may say it is required and we will sort all this out later, or I must have some thing wrong
Well, how many bailouts do you think will be repaid
This is not keeping jobs except for a few who have made their pile of money and continue to make money
This is stuff that you and i don't fully understand so we accept what happens
Trust me, if we have a depression with a 30 trillion deficit you may wish you had done a bit of research and cried foul to your congress
At least you could ask some questions about the primary dealers, the Fed bailout and make your own decision. You don't have to agree with me.
Why do we think a person who works for the gov't in a suit and tie has our best interest at heart
You know that isn't true yet what do you do??
I have no idea if this is happening in our country [Canada] but I have not read about it
I got this from Zero Hedge
Sorry I have tried to do links and my memory just will not let me do it, so I did the best I could
I would appreciate a response to the last post in this thread please.
yes, we definitely should limit bailouts.
but here is a basic problem. if i own a bar/grill. and if the state makes me shut down. that is basically the not my fault if i fail. it is the fault of the governor, and could be seen as an imminent domain issue. the state should pay me if they "take" away my business. in my opinion, it is the same as if they take part of my land to widen a road.