Obama administration plans to slash pay of executives at 7 bailed-out companies

[Facetious]

^ ^Glass Steagall :thumbsup:

^ Tits - democrats are every bit as much susceptible to corruption as the republicans, they just don't admit as much.:bowdown:

 

[titsrock]

^
Maybe. The Democrats don't actually try to inact policies which harm all Americans like the Republicans do. The Republicans believe that Gov't is meant to serve the interests of the rich. "Trickle down" economics--if we pump up the rich, maybe they will, in their heart of hearts, toss crumbs to the non-rich. The Democrats simply do nothing but maintain the status quo.

In order to change America, we must take that document that the Republicans seem to have "found Jesus" in, the Constitution, and make SIGNIFICANT CHANGES so that Corporate interests and Lobbying interests are removed from Government.

It is no longer 1776, when Adam Smith lived and it's no longer 1850 when Marx wrote about Capitalism.

Marx wrote about Capitalism from the British Public Library, where he read all the classic texts that he wanted. It wasn't like he was off somewhere in East Euro drinking cognac and smoking cigars.

 

[Rey C.]

Well it is NOT the 4th option that's for sure. Something has to be better then the goverment running our banks and businees'. I have not had a banking or economics class since college, 9 years ago, but like I said beofre we can't have the goverment controling our banks and business'.

OK, it's not the 4th option - glad you said that. So you don't believe we can let major bank holding companies go under when they become insolvent - might not be so great for the overall economy, right? So what do we do to either "fix" them, once they become insolvent, or from taking on so much risk that they could become insolvent in the first place? Maybe some regulations so that the FDIC or someone could keep better tabs on the big money center bank holding companies? But increased regulation is a form of control - and you said you didn't want that. And you know of course that when a local or even a regional bank fails, the FDIC steps in, and they do take those institutions over. That's been the case for 70+ years. Under Ronald Reagan, the FDIC/U.S. government took an 80% share in the failed Continental Illinois National Bank and Trust, costing the taxpayers at least $4.5 billion. This was done under the banner of "too big to fail" (see, that's not a term that Comrade Obama invented). The Resolution Trust Corporation was born under the Bush(I) administration, when pretty much the entire U.S. savings & loan industry folded up and died (the problems actually came to light under Reagan). The FSLIC couldn't handle the problem, it folded and the U.S. government stepped in there too! More socialism/fascism? So Reagan and Bush I were socialist, communist, fascist totalitarians? :rofl:

But just talking about bank failures, here is a period rundown.

• 2000-2007: 32
• 2000-2007: 32
• 1990-1999: 925
• 1980-1989: 2,036
• 1970-1979: 79
• 1960-1969: 44
• 1950-1959: 28
• 1940-1949: 99
• 1934-1939: 312

http://www.fdic.gov/bank/individual/failed/banklist.html

So when people speak as if the government has NEVER done what is being done now (in general principle), one only has to look back at recent economic history to see THE FACTS, and to know that is simply not true. Is it a good thing? Of course not! But when I hear people say that capitalism is being killed, and we're headed for fascism/socialism/communism/maoism or most any other "ism" (that's being dreamed up now), I just look back over the facts and try to stay sane.

There is a problem - no doubt about it! And a problem represents an opportunity for improvments and corrections. But too many people are just running around like Chicken Little (not really directed at you, Jason), either misrepresenting the situation or not remembering that this isn't the first time we've traveled this road.

What did we learn from the finacial crisis of the 1980's? Well, a "good man", by the name of Phil Gramm, (you may remember him as John McCain's chief economic advisor and the man who likely would have been Treasury Secretary in a McCain/Palin administration) introduced the Gramm-Leach-Bliley Act, which repealed the Glass-Stegall Act. Oh, and our man Phil also inserted the "Enron Loophole" into his Commodity Futures Modernization Act. What are derivatives? According to Phil, they're nothing to worry about. There's a few trillion dollars worth floating around now... and they could still sink us. But Phil said that we don't need no stinkin' regulations on derivatives! And so... here we are. :wave: There are plenty of scoundrels in this mess. But ol' Philly boy was certainly a chief architect.

One of the first things I would do is bring back Glass-Stegall in some way, shape or form! And if that makes me a communist/fascist/maoist/socialist/follower of Mr. Spock, I don't give a rat's ass. :hatsoff:

 

[titsrock]

^Re-instating Glass-Stegall is a good start.

But.

How will Glass-Stegall prevent the next Internet Boom/Bust/pump/dump cycle (which we experienced 1996-2000)?

How will Glass-Stegall prevent the next real estate pump/dump crash?

We need a shit load of modern regulation.

How do we get off the economic train of pump/dump cycles? That seems to be our economy in a nutshell.

 

[Friday on my mind]

Let me post this here,it really is a great indictment of our political system and both parties and there lack of being able to regulate our economy.
http://www.pbs.org/wgbh/pages/frontline/warning/view/

" In The Warning, veteran FRONTLINE producer Michael Kirk unearths the hidden history of the nation's worst financial crisis since the Great Depression. At the center of it all he finds Brooksley Born, who speaks for the first time on television about her failed campaign to regulate the secretive, multitrillion-dollar derivatives market whose crash helped trigger the financial collapse in the fall of 2008."


A must view for anyone who wants to know the truth IMO.

 

[Rey C.]

^Re-instating Glass-Stegall is a good start.

But.

How will Glass-Stegall prevent the next Internet Boom/Bust/pump/dump cycle (which we experienced 1996-2000)?

How will Glass-Stegall prevent the next real estate pump/dump crash?

We need a shit load of modern regulation.

How do we get off the economic train of pump/dump cycles? That seems to be our economy in a nutshell.

We have to consider what Glass-Steagall (my spelling sucks today, BTW) was and what it wasn't. What was its initial purpose?

It's not that it would have prevented the things you're mentioning. But it would have limited the damage done to the macro economy, by limiting the footprint of the bank holding companies.

Glass-Steagall (by itself) wouldn't prevent the Fed from keeping interest rates artificially low (which encouraged and supported some of what you mentioned). Neither would it prevent banks from undertaking predatory lending practices, or channeling consumers into inappropriate products. It wouldn't prevent underwriters and ratings agencies from approving loans or placing inappropriate ratings on debt and equity securities. So I agree that other measures are needed to address those concerns. Although some of those measures already exist. They just were not enforced over the past 8-10 years. If I had a dollar for every banking regulation that was violated as bankers, real estate agents, borrowers and appraisers were creating "liar loans" and the like, I could retire tomorrow. To say nothing of the people who were placed in higher cost (higher profit) subprimes, when they actually qualified for prime mortgages (roughly 60% according to a Fed study).

IMO, reinstating Glass-Steagall would be an important first step in getting us away from this notion of "too big to fail". I have NO problem with unsuccessful businesses failing - I think they should fail. But I do have a problem when those businesses have been allowed to weave their tentacles so deeply into our economy that their failure means that we all must suffer greatly.

The bankers and traders know the business. There are VERY few in Congress who even understand the basics of the financial industry. I am for limiting the size and/or scope of the huge houses. But protecting people from their own stupidity and greed is an impossible task to undertake.

 

[Rey C.]

Let me post this here,it really is a great indictment of our political system and both parties and there lack of being able to regulate our economy.
http://www.pbs.org/wgbh/pages/frontline/warning/view/

" In The Warning, veteran FRONTLINE producer Michael Kirk unearths the hidden history of the nation's worst financial crisis since the Great Depression. At the center of it all he finds Brooksley Born, who speaks for the first time on television about her failed campaign to regulate the secretive, multitrillion-dollar derivatives market whose crash helped trigger the financial collapse in the fall of 2008."


A must view for anyone who wants to know the truth IMO.

My weekend plans have pretty much been shot to hell. So I'm going to make an effort to watch that tonight. :thumbsup:

 

[om3ga]

Again, a good idea, but a terrible precedent.

If these companies were going under paying CEO's a shitton of money, why not let them fail? That's what happens to companies that aren't smart with their money.

But now, the taxpayers bailed them out, and now the government can set their salaries? Wow... this truly disturbs me on so many levels...

You would let American International Group Inc., Citigroup Inc., Bank of America Corp., General Motors Co., Chrysler, GMAC and Chrysler Financial ALL fail?

 

[titsrock]

But protecting people from their own stupidity and greed is an impossible task to undertake.

This isn't the problem anymore. As we've seen (and you discussed), the average consumer and Investor has been lied to for years. The most outrageous lies have been been evident probably since the S&L crisis of the 80s but certainly the Tech Industry has brought with it a a degree of lying and--throwing good money after bad ideas--the scale of which we've never really seen before.

We can't call people stupid for making decisions based on outright lies and misleadings.

 

[calpoon]

The corporate bail out scheme is nothing more than a government special interest corporate acquisition scheme which has the potential to create moral hazard- like predicaments for corporate board of directorships, that is, for the ones that aren't already complicit with the program.

Just imagine, the federal government having to ability to "rescue" (bail out and assume control of) the very corporations that they themselves conspired to bring down ? :dunno: I'm just thinking about possibilities, folks.

This is the ultimate "we will destroy you from within scheme" if you ask me.

I have to agree. The problem is that people are viewing this as a partisan issue. The United States Government has been Communist since 1942. And the Communist countries have been becoming more Capitalist since then... that's because it's all the same thing. It's just a power grab. If the two were so ideologically and systematically opposed why would the US and China be the world's number one economic trade partners?

Ok, so chalk this up to paranoia if you will and ignore the above, but think about this: If the government gave the same funding that it spent on the "bail out" as reward/incentive to companies that demonstrated a successful economic approach to business and sustained growth, instead of to the one's that failed, wouldn't that have had at the very least the exact same effect on the economy?

 

[titsrock]

Ok, so chalk this up to paranoia if you will and ignore the above, but think about this: If the government gave the same funding that it spent on the "bail out" as reward/incentive to companies that demonstrated a successful economic approach to business and sustained growth, instead of to the one's that failed, wouldn't that have had at the very least the exact same effect on the economy?

I can't get by the fact that our most important trading partners are all Communist nations. If we're supposed to be ideologically opposed to Communism, why do we put so much of our economy in Communist countries' hands? All except Cuba. For some reason, we hold them accountable for something....Does Castro have a gay Kennedy porno or something?

I worry that I will wake and read that the U.S. has contracted with Chinese Pharma companies to produce H1N1 vaccinations. That will be the point where we truly might as well run up the Red Star Flag. We will be unable to care for our own people.

The reason we don't give big bailout money to successful companies is they don't need it. What would they use it for? They already have a biz plan that's working fine. :dunno:

We haven't addresses regulation and we have corrupt trade agreements. If we want to be serious about fixing our economy, we'll enact protectionist trade policies.

 

[Rey C.]

But protecting people from their own stupidity and greed is an impossible task to undertake.

This isn't the problem anymore. As we've seen (and you discussed), the average consumer and Investor has been lied to for years. The most outrageous lies have been been evident probably since the S&L crisis of the 80s but certainly the Tech Industry has brought with it a a degree of lying and--throwing good money after bad ideas--the scale of which we've never really seen before.

We can't call people stupid for making decisions based on outright lies and misleadings.

I'm not tagging the consumers as being the stupid ones though. Consumers and small investors can be stupid and greedy at times. But more often than not, their problem is ignorance: simply a lack of adequate knowedge. I trust my doctor because I'm generally ignorant when it comes to medicine. And many people place their trust in those who they believe are "financial professionals", because they're generally ignorant when it comes to finance.

So I'm really talking about the Chief Traders and executive level corporte officers, who signed off on policies and procedures that pushed products which were based on (pure) fantasies... thereby earning my opinion of them as stupid and greedy. Now those people should have known better. Along with lax regulation and enforcement, it was their stupidity and greed which sank these companies. It was their massive FUBAR's which caused the U.S. government to have to step in. In an interview several months ago, even Alan Greenspan admitted that he couldn't understand the mathematical or economic basis for some of these instruments. Why? Because few of them made the first bit of sense. It was all bullshit and make believe... but (somehow) rated at least BBB−. Imagine that = fraud.

But if someone wants to open an inventment bank which makes or offers investments that rely on a 10% annual increase in housing prices for the next 20 years (which some of these mortgage backed securities did) , more power to them. As long as their paper is accurately rated CCC+ or lower, and there's no fraud, let Darwin sort it out. But that can't be allowed to happen at something as big as a Citi or Bank of America. And if it does, at the very least, the commercial side has to be kept (IMO) completely separate from the investment banking side.

 

[E-Ann-Hilden]

Is this not classic fascism:
publicly traded - government controlled ?

Publicly traded, laissez-faire and lobbyist controlled government, sorry!

 

[E-Ann-Hilden]

My weekend plans have pretty much been shot to hell. So I'm going to make an effort to watch that tonight. :thumbsup:

Frontline is by far the best news worthy show on tv. It always brings a clarifying light on politics and its indiscretions. The last eposide was one of the best,

 

[Facetious]

I can't get by the fact that our most important trading partners are all Communist nations. If we're supposed to be ideologically opposed to Communism, why do we put so much of our economy in Communist countries' hands?

At the risk of broad brushing an entire political party, for doing things that harm all Americans -
Google :"Bill Clinton • China • Most Favored Nation Trade Status"..... yea, that should suffice.

How did the chicoms acquire ICBM know how ?
Google : "Loral Missiles & Space • Bernard Schwartz • China • Bill Clinton and ''scandal'' for good measure. :hatsoff:

All in all, this thread illustrates how investors NEED TO DIVERSIFY today more than ever.
There are flakesters here, there and everywhere, lurking about, seeking out the perfect scheme to steal investor securities. Careful where you invest !

Before I go, why do they call 'em "securities" for ? My ass securities !!!!!

Why are brokers called brokers ? :1orglaugh:

 

[raychik]

The reason why those companies had to be bailed out was partly because the top execs did a horrible job and should be fired...they're lucky they just got a paycut. If they want to go to another company that will pay them "what they deserve" then I say good riddance to bad rubbish; I wish those new companies luck.

 

[titsrock]

At the risk of broad brushing an entire political party, for doing things that harm all Americans -
Google :"Bill Clinton • China • Most Favored Nation Trade Status"..... yea, that should suffice.

I did exactly as you asked in the order you wrote (removing the dots) and came up with this link as the first link returned. I'd like you to read it and let us know what you think.

The responsible party for our Economic Misery

 

[carlcox]

I think all comes down to balance. Most world nations have an economy that is a mix of socialism and capitalism. The socialism usually as a safety net, with the capitalist left free to do what ever, within some boundaries, because it is the capitalism that provides jobs, profits and pays the taxes of the social programs from socialist elements. If you damage the free market side, it will and does the effect/affect the socialist side.

 

[SolidCobra]

I don't know about you, but if my company cut my salary by 90%, I'd take it as a pretty strong signal to seek other employment. It'll be interesting to see what proportion of the affected high earners bail themselves out by going to work for a foreign competitor or somesuch.

 

[FlyingWallaby]

Yeah....great...if they didn't fail badly enough on their own, let the government decapitate their management ranks. More fun from the people who brought you the USPS.