850 Billion Dollar Stimulus Package

Problem being, if we end up taking a 40% stake in Citi and the economy rebounds, I fear government ownership of banking will be viewed as positive and start us down the kind of socialistic path described by Karl Marx in Das Kapital. Central banking is NOT the answer and we DO NOT need to own Citigroup.

 

I didn't say that stuff dawg, but tirk and SabanFan have it right and you are taking elrushbo's comments severley out of context. I can't stand the guy, but I think partisan leanings are blinding you on this one.

This is at least the second time you have used this phrase. Don't you find it a bit mellodramatic. It sounds really silly.

The government does not need to be involved at all for this to happen. If the bad banks fell well capitalized banks will move in to fill the space, lend money, and hold deposits.

If citi group were to fail the banks assets would gobbled up by competitors.

 

From Japan, another nation that went through a "balance sheet recession" in the 90's (which is NOT a normal business cycle slow down). This is by Richard Koo, Chief Economist for Nomura Securities in Japan. He does not have a dog in the democrat vs. repub. thing.

http://www.npr.org/templates/story/story.php?storyId=101066132

None of us has actually been there and done that, but Japan HAS. The five minute recording is worth listening to, he gives more details ("color" if you're an Investor Relations person).

 

You don't know what you're talking about, Red. It was during the Hannity interview that he first said he wanted the policies to fail in response to Hannity's asking if he wanted Obama to fail.

 

Totally agree with most of this.

Buying public stock is a serious long term issue. There is little that needs to be said about it because I think most of us agree that government ownership of banks is a bad move and doesnt fix their problems. All it does is give them a crutch.

I dont necesarlity agree SEC regulators, or any regulators for that matter, didnt do their jobs. Their jobs became unbearably complicated after the mega mergers that follow the FSMA in 1999. It was impossible to a get a good grasp on the depth and breadth of these super mergers and what was left after them. IMHO, that led to a regulatory nightmare and caused these institutions to run amok, unchecked.

BINGO! They shouldnt just be allowed to fail, they should be taken into receivership immediately! If Citi is back with their hands out there is no hope for that bunch. All pay should be frozen, all assets tallied and receivership should liquidate them ASAP. We are throwing good money after bad with that company. They are done and no matter how much money we invest it;s over. The last thing we need is 40% of a failing enterprise.

I misquoted here but regarding the regulators, we need regulators who are prepared to audit the kind of companies the FSMA left us with. The one thing we dont have is proper regulation for these super groups like Citi. Its uncharted territory and nobody ever had to regulate a complex entity like this before. Its hard to blame the SEC when they were handed an albatross to keep in check.

Now, about the national financial system. If we own the banks it is clearly a walk down the socialistic path. We should never own any bank no matter how much of a share we take. It will undoubtedly lead to things like ownership of energy, health services, transportation, etc. Its a BAD move. If any group can not get by with the stimulus help they already received, its time to fold and move on. If not we will keep throwing bad money at these entities which wiil be tantamount to flushing thousand dollar bills down the toilet.