Fed bails out AIG, $85 billion to avoid the worst financial collapse in history..

[Spitzered]

Opps, spoke to soon, I guess congress is calling for hearings. Probably with the same effect it had on Oil companies.

 

[whiterain]

The story with AIG. This is what I know and see going on and it is terrible. Get ready for a financial disaster very soon everyone!

First of all, AIG is the world's biggest insurance company. They insure everything from airplanes to actual cities and townships. Starting since the Clinton administration it has always been that when buying a home you put down 20%. Therefore, if you are buying a $100,000 home you would have to go to the banks with $40,000 and get a loan for the other $160,000 and pay it off on typically a 30-year mortgage. However, as it became harder for people to get that 20% to throw down on the house, they brought their rates down 15%, then 10%, then 5%, and then almost nothing. This meant that people who could never had been able to afford a home were being able to take out huge loans and pay them back on an "adjustable" mortgage rate. These rates were affordable at first being 2% interest rate, however this continued to rise over the years and has gotten to 6, 7 or 8%. This means these people who received these loans were unable to afford to live in their home anymore because their mortgage went up 200-300% in just a span of a few years. They were forced into bankruptcy. Now shit is hitting the fan and AIG was heading towards bankruptcy, as they should for giving out loans to people who they knew would never had been able to afford it, in the end trying to profit off of the common man's income going towards a mortgage rate that was tripled on them.

Now the govt. has AIG and we will see what they do. At first, they weren't even going to buy AIG, but all the big companies, such as the airlines said that if the govt. doesn't do something than when AIG goes out of business, no planes will be able to fly, because they wont have insurance and you can see the other side affects that would occur everywhere all across the world if that happened.

The govt. had to buy AIG out, it is just what will they now do that they own AIG? What can they do to fix this situation, and help those poor people that were fucked by AIG and the government initially?

We will see...this world is fucked up, I'm not happy with the way people in power have taken things. It really is up to us, the people, to raise our voice and tell them that we will not tolerate this shit that is going on, because we are in a clusterfuck right now people!

I could go on and on, but I wont, just going to start rolling a joint or something...haha PEACE!

 

[TheBrutalTruth]

The story with AIG. This is what I know and see going on and it is terrible. Get ready for a financial disaster very soon everyone!

First of all, AIG is the world's biggest insurance company. They insure everything from airplanes to actual cities and townships. Starting since the Clinton administration it has always been that when buying a home you put down 20%. Therefore, if you are buying a $100,000 home you would have to go to the banks with $40,000 and get a loan for the other $160,000 and pay it off on typically a 30-year mortgage. However, as it became harder for people to get that 20% to throw down on the house, they brought their rates down 15%, then 10%, then 5%, and then almost nothing. This meant that people who could never had been able to afford a home were being able to take out huge loans and pay them back on an "adjustable" mortgage rate. These rates were affordable at first being 2% interest rate, however this continued to rise over the years and has gotten to 6, 7 or 8%. This means these people who received these loans were unable to afford to live in their home anymore because their mortgage went up 200-300% in just a span of a few years. They were forced into bankruptcy. Now shit is hitting the fan and AIG was heading towards bankruptcy, as they should for giving out loans to people who they knew would never had been able to afford it, in the end trying to profit off of the common man's income going towards a mortgage rate that was tripled on them.

Now the govt. has AIG and we will see what they do. At first, they weren't even going to buy AIG, but all the big companies, such as the airlines said that if the govt. doesn't do something than when AIG goes out of business, no planes will be able to fly, because they wont have insurance and you can see the other side affects that would occur everywhere all across the world if that happened.

The govt. had to buy AIG out, it is just what will they now do that they own AIG? What can they do to fix this situation, and help those poor people that were fucked by AIG and the government initially?

We will see...this world is fucked up, I'm not happy with the way people in power have taken things. It really is up to us, the people, to raise our voice and tell them that we will not tolerate this shit that is going on, because we are in a clusterfuck right now people!

I could go on and on, but I wont, just going to start rolling a joint or something...haha PEACE!

Whiterain, from what I understand the problem AIG encountered was their London Offices betting wrongly on CDOs and insuring them. AIG is not a mortgage broker, or a bank. It is not their fault that the banks were forced by government interference to lower their lending standards so any one who thought they should get a house could get a house.

Stop talking out your ass.

 

[misshestermoffitt]

We could sing it to the tune of Michael Jackson's "Bad"

We're fucked, we're fucked, you know it,
I'm fucked, you're fucked , you know it,
They fucked, we got fucked, you know it, shammon

 

[VTXDave]

No thoughts on the passing and signing of the Gramm-Leach-Bliley Act, eh? Not surprising...Easier to place the onus on Bush I suppose.

 

[tipsgnob]

McCain's former economic adviser is ex-Texas Sen. Phil Gramm. On Dec. 15, 2000, hours before Congress was to leave for Christmas recess, Gramm had a 262-page amendment slipped into the appropriations bill. It forbade federal agencies to regulate the financial derivatives that greased the skids for passing along risky mortgage-backed securities to investors.................

 

[Seamaiden]

McCain's former economic adviser is ex-Texas Sen. Phil Gramm. On Dec. 15, 2000, hours before Congress was to leave for Christmas recess, Gramm had a 262-page amendment slipped into the appropriations bill. It forbade federal agencies to regulate the financial derivatives that greased the skids for passing along risky mortgage-backed securities to investors.................

And so Congress, somewhat like it did with the Patriot Act, didn't bother to read what they were voting because they just HAD to get home in time for Christmas (we all know how hard they work all year, right?)! Yay! Congress! It's all Bush's fault.

 

[VTXDave]

Sen. Phil Gramm.

A real "piece of work" that guy is, yeah? Oh...did I say work? I meant to say sh...ummm....nevermind.

 

[tipsgnob]

when the ship goes down, it's always the captains fault....

 

[VTXDave]

 

[TheBrutalTruth]

No thoughts on the passing and signing of the Gramm-Leach-Bliley Act, eh? Not surprising...Easier to place the onus on Bush I suppose.

I was going to ask what it was, and what it did, but decided it'd be easier to search it.

The bills were introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA). The bills were passed by a 54-44 vote along party lines with Republican support in the Senate[1] and by a 343-86 vote in the House of Representatives[2]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. This veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [3]
The banking industry had been seeking the repeal of Glass-Steagall since at least the 1980s. In 1987 the Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall and the case against preserving the act.[4]
[/qoute]

Two separate United States laws are known as the Glass-Steagall Act. The Acts (Glass & Steagall) were both reactions of the U.S. government to cope with the collapse of a large portion of the American commercial banking system in early 1933. While many economic histories attribute the collapse to the economic problems which followed the Stock Market Crash of 1929 it is clear that the U.S. banking collapse of 1933, which came three and a half years later, could only have been partially the result of the stock market collapse in October 1929.
The Republican Hoover administration had lost the November 1932 election to Franklin Delano Roosevelt, but his administration did not take office until March 1933. The lame duck Hoover Administration and the incoming Roosevelt Administration could not, or would not, coordinate actions to stop the run on banks affiliated with the Henry Ford family that began in Detroit Michigan in January 1933. The Federal Reserve chairman Eugene Meyer was equally ineffectual.

The repeal enabled commercial lenders such as Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities. Citigroup played a major part in the repeal. Then called Citicorp, the company merged with Travelers Insurance company the year before using loopholes in Glass-Steagall that allowed for temporary exemptions. With lobbying led by Roger Levy, the "finance, insurance and real estate industries together are regularly the largest campaign contributors and biggest spenders on lobbying of all business sectors [in 1999]. They laid out more than $200 million for lobbying in 1998, according to the Center for Responsive Politics..." These industries succeeded in their two decades long effort to repeal the act.[12]
The banking industry had been seeking the repeal of Glass-Steagall since at least the 1980's. In 1987 the Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall and the case against preserving the act.

Sounds like it was bad legislation, but at the same time it was a result of prior legislation that was reactionary in nature. It's kind of too late to close the gates after the horse is already out.


Though I was reading the Day the Market Crashed, or something like that (I don't remember the exact title) but it mentioned that Banks were prohibited from forming investment firms and from trading in their own stock which forced National City Bank to form the National City Corporation (Bank, Investment Firm).


And it also mentioned the Industrial Bank in Flint which collapsed not due to it being involved in investment activity but due to massive embezzlement ($2 Million by 1929) on the part of its employees, including VPs, the Chief Cashier and lower Cashiers.

 

[VTXDave]

Ron Paul goes "Toe-to-Toe" with Bernanke earlier this year....

<Note the ticker where Bernanke states that subprime lending can stimulate the economy if executed properly>

YouTube - Ron Paul Schools Ben Bernanke Yet Again 2-27-08

 

[TheBrutalTruth]

Was it just me or did Bernanke look like a deer caught in a pair of headlights?

 

[TheBrutalTruth]

Ron Paul Talks About Digital Gold Currency 2002 Interview / Ron Paul

Another statement about stable currencies, and another statement about what would happen to the markets (near the end).

 

[homerdog]

I love Ron Paul, but he continually avoids the opportunity to stand up and speak with a big voice when opportunities present them selves. Americans like big loud pushy politicians, he has unbeatable logic, just not abnoxious enough to be noticed by most Americans. He takes the high road of a gentlemen, to be applauded for sure, but we need the gentleman to pick up a big stick.

 

[HotNSexyMILF]

I love Ron Paul, but he continually avoids the opportunity to stand up and speak with a big voice when opportunities present them selves. Americans like big loud pushy politicians, he has unbeatable logic, just not abnoxious enough to be noticed by most Americans. He takes the high road of a gentlemen, to be applauded for sure, but we need the gentleman to pick up a big stick.

Have you seen his interviews from the 80's? =) Dr. Ron Paul used to be quite the firecracker.. but seriously, after decades of being in Congress standing alone being called 'crazy' and 'fringe' and now in his 70's.. can you blame the man? He's done almost 2 years nonstop campaigning, he's had his life threatened multiple times, then his wife nearly dies- give him a break.. the rest of us need to fight for liberty too.. lol..

He is certainly a refined gentleman, it makes me sick how that isn't a 'good politician' to Americans anymore..

 

[homerdog]

I quite enjoy his style, unfortunately many people don't know anything about him. I try to do my part and spread what I have learned from him. Entering the political system is continually on my mind, as you said it is hard to see how RP has fought and how very few listen, would I do half as good a job - prob not.

What about a multimillion man march, we the people are going to have to organize and make the truth heard. I'm not even sure we are free enough to march on a platform of massive political reform, now! The arrests and beatings that took place at the conventions, in the name of security, was the biggest news that happened and barley a soul blinked an eye, I broached the subject with classmates and coworkers - they were like really? - that sucks.

 

[homerdog]

RP's video's, todays, on campaignforliberty address this thread to a T, a must watch.

 

[TheBrutalTruth]

Beat Dogs Don't Attack Their Owners, They Slink Away In Fear.

Have you ever seen that, how an animal if it has been constantly abused will just slink away. Maybe if you look at the response your classmates gave to your statements you'll notice the parallel.

We are too damn use to being an enslaved people.

 

[homerdog]

Actually they slip away into consumerism and worthless mass media. There are 3-4 of 50 of us who actually pay attention to stuff and don't tow the line, you would think it would be a better percentage since we are grad students.