Don't you know - the fix is in. Bu$h and his Gang 'O Pirates are just trying to make off with the last bit of money left in the Treasury.

http://emptywheel.firedoglake.com/2008/09/23/bush-mouthpiece-admits-theyve-been-sitting-on-this-plan/

There's a big difference between (a) the bank offering a loan or having an internet ad running, and (b) the bank actually completing the process and writing you a check. Good luck with (b).

Looking for some outside-the-bubble information, I did some of the same sort of research that Johnston did (poking around online and talking to friends who are in the industry) and I share his conclusion. We should be in no hurry to put this bailout through and absolutely not at this price, which is looking more and more arbitrary to me. Everything about this looks arbitrary to me except the motive behind it all, which is to bankrupt this country and make it so people believe the gov't is only capable of waging war and protecting property rights.

I don't understand this sentence:

And if that's the case, Paulson and Bernanke should simply run them over and have Congress strip their autonomy.

Why are you separting P and B from the mix of people who should be run over? (I'm not kidding.)

I think "what's the unholy rush" has been the question underlying all of this since Thursday; if Paulson and Bernanke have something to point to then by all means, point. But ask the question - and I've seen it asked, over and over - of them, and they just say "if we don;t act now there will be [vague, unspecified] disaster." Not good enough.

I wouldn't discount all the conspiracy theorists either - I think the reason this thing is hitting roadblocks is that the Bush folks have, as an Administration, pretty much zero cred at this point. Which is another reason they should have known that "evidence" would be actual things one can point to and observe, not more vagueness.

All of that said, and not to question someone like Johnston, whose clearly got more expertise... but to say there's not evidence of a credit crisis seems a bit blind. That some lenders are still pushing really bad loans to really unqualified people only tells me that lessons have not yet been learned, and that tells me that things could easily get worse before they get better. I do think that Paulson and Bernanke have insights into the industry the rest of us don't, and people whose job it is to predict where things are headed with more insight than the rest of us. And I do think we've got a major economic disaster on our hands, one that will require government intervention sooner, rather than later. It's what that intervention looks like, and who manages it, that's the question right now. Just because I think the Paulson "blank check" plan is hopeless doesn't mean I don't think we have a problem. It seems clear we do.

BORING! This is soooo boring.

Biden is so much more exciting. If any Republican had as many idiotic statements as Biden, all the lamestream media would be demanding he step down as being unfit to serve in high office of responsibility.

Now he claims FDR went on TV in 1929 to talk to the public about the crash? Are we sure his brain surgery worked?

He says we should have no coal fired plants in the US? Bye Bye West Virginia

Calling Obamas ad on McCain e-mail TERRIBLE.

Claiming his helicopter was forced down by gun fire..

The guys is not a loose cannon, he's a dangerous cannon.

Well, if their scare story is not true, that's all the more reason we need to use their own conception of it to turn the debate around, and expose the true contours of the "bailout" they are proposing.

They are saying the U.S.S Economy has hit a million tiny icebergs in the dark of night, and will sink to the depths if we don't act NOW.

They're asking each and every passenger to sign over a promissory note of nearly $8000, to pay for a brand-new ship that, if we act TODAY, will immediately materialize out of the mist right next to our sinking hulk.

But they are also telling us that we must remain on board our listing vessel: the new water-tight craft we just built and paid for is smaller and sleeker, and at the moment unfortunately has berths only for the captain and crew. They will be transferring to the new ship ASAP, but they want to assure us that they are profoundly grateful for our generous contributions.

The good news is that since we're dead in the water and will soon be much lighter, if we do everything we can to plug up the holes in our hull, our damaged ship should stabilize to the point where we're just above the waterline.

The even better news is that the new ship we just paid for will now be able to quickly and easily ply the waters and put into multiple exotic ports--and take on enough new, low-risk passengers to finance the future expansion of the ship. In a few years, they should be big and strong enough to come back to rescue us. If they can remember where we are. And if we don't sink before then.

OK then. Hunter is right:

the Paulson plan is to presume these mortgage-backed assets are steeply overvalued, and therefore purchase them in bulk in order to help retain as much of that value as possible. A bottom-up approach would be to intervene in the mortgage markets so that those investments really do have value, or at least do not represent black holes of risk. It would in theory have the same effect.

We've got to plug all the holes in our hull and bail this damn ship out from the bottom up.

for the wonkish, some articles for the wonkish layperson at Economist's Voice

http://www.bepress.com/ev

should have said "articles on the bailout and Paulson plan" sorry

This is a huge amount of money.....unexpected and totally avoidable.

What I want to know is when are the inquiries going to start? When there was speculation about price gouging, Congress held hearings.

I doubt if this will happen because all in Congress know it will lead them to Chris Dodd, Pelosi and other prominent Democrats.

So, the larges bailout in history and all will be swept under the rug.

Thanks, Democrats.

I just got an email from my mortgage broker saying that if I refinanced my home loan I could get a better interest rate than I have now! Wassupwidat?

A big source of our misunderstanding is that we (as progressives) envision different objectives for government action.

While we think government is here to build national infrastructure and resolve social and public problems, they think governments is here to enrich themselves.

They know that time is not on their side, and if they wait much longer, they will not get their $700Bil.

And lest you think this is merely cynical talk, you should perfom a review of all that this administration has accomplished since 2001...

1 - a grand reduction in tax rates that increases exponentially with weath.

2 - hmmm... well... number 1 is a pretty big accomplishment for them.

I say we pay for this (or a chunk of it anyway) with a massive one-time tax on anyone with more than 50m in total wealth (I'm thinking in the neighborhood of 3-8% of total wealth). Once the wall street folks have to pay for a massive chunk of this, we'll see how necessary they actually think it is.

Motherf*cker, but this bailout pisses me of.

Don't substitute glib anti-elitism for actual economic analysis.

You ask "If Wall Street were teetering on the brink of collapse, their only hope of survival a $700 billion emergency action from the government, they'd be in a state of total desperation and Paulson and Bernanke would be able to dictate terms. "

Do you not remember LAST WEEK? When Paulson did in fact dictate the terms of what Lehman, Merryl Lynch, and AIG would do?

Er, no. Paulson dictated what AIG would do, and refused to bail out Lehman. Mother Merrill saw same and saved itself, as now have Morgan and Goldman. I give you a one for three, though with the noises big AIG common holders are making, you might end up with an oh-fer -- especially if this bailout goes through in something resembling original form.

On-topic, I would say Ezra is mostly wrong here. When you have runs like we have seen the last six months, down to freaking commercial paper in money funds (have you tried to move now-guaranteed-by-the-gubmint Frannie paper? you have not), you have a real problem. However, he is right about a few things. There is no reason to write Paulson (who while not an idiot is no Volcker or Rubin) a blank check for a trillion dollars, and there is no reason to recapitalize by rescuing the stupidest among us, instead of replaying the RFC (1930s US, imperfect but not bad) or Sweden's more-recent and much-better-administered bailout funds.

There is a real problem, and recapitalizing is the answer. I just want to see equity holders wiped out if they hired (and overpaid) idiot managers who put them in position to need it.

Ask Frannie common shareholders. They got what they deserve. So should the others.

Everyone should read this awesome post by Krugman:
http://krugman.blogs.nytimes.com/2008/09/23/getting-real/

Its simple. No bailouts to banks without an equity stake in those banks. No equity - no deal. Bottom line for US taxpayers.

Politically, the Dems should not vote for this if McCain votes no. That is a dealbreaker.

As to the package - what it seeks to do can't be done. The amount of fictitious money involved in the credit swaps alone would swamp any attempt to staunch the losses. A commenter wrote into the article by Roger Lowenthal, which said that there was no crisis in the market, and said, that's crazy. What about the sixty five trillion dollar credit default swap market? The objection answers itself. There shouldn't be a sixty five trillion dollar credit default market. It is a series of bets that does nothing productive for the economy - a rent seekers dream. If it folds, it will simply wipe out the fortunes of people who would do better doing something else - wiping car windshields at red lights, for instance. To rescue it would require, well, a seven hundred billion dollar rescue every year for the next sixty five years.

As always, in Bushlandia, we are told that a project that has failed time and time again has to be supported, only with more money, so we can really try it again. There is still no explanation as to why this would work, or, if it worked, why we should care.

The Fed's attempt, for the past year, to prevent the stock market to do what stock markets do during a recession - shed value and moving down by some large percentage - should give us a clue that state entanglement in the financial sector can only lead to throwing bad money after good. Ideally, there should be no plan whatsoever to give the financial sector money, and the seven hundred billion should be earmarked for a special bank modality, run by the government through commercial banks, to loan people money, average people money, at reduced rates to pay down their debts.

So: The Paulson plan is going to be a failed response to the inevitable shrinking of the financial sector in this economy. Halleluja! If the Government invests, instead, in reviving manufacturing via green tech in this country, we might actually have a fairer economy, one that benefits more people, and one that actually makes useful stuff.

How about 9.2% for a 30 year fixed non-conforming mortgage? Not the end of the world, but not exactly great.

https://www.wellsfargo.com/mortgage/rates/