Let AIG Go Bankrupt, Not America

[RCprince]

http://www.cnbc.com/id/29476319/site/14081545


Jim Rogers:

American International Group should be allowed to go bankrupt because keeping it and other sick financials alive on government support risks ruining the US economy, legendary investor Jim Rogers told CNBC Tuesday.

[RCprince]

I agree, Which ever analogy or metaphor you may use to describe this dire situation( A ship sinking and we need to throw non essentials overboard or a cancerous tumor that needs to be removed) is appropriate. But AIG, GM and all the rest of those oozing companies, need to go! They've had their time to shine, nothing last forever. Eastern and Pan Am were two great airlines, but their time was up and we've moved on. Fighting the inevitable is is just wasting resources. it's like trying to plug a hole in the boat your in with the cloth on your back, while there are other boats around you. JUMP f@##$g ship people... let them go before they drag us all to financial hell. Next we'll be seeing Mao Zedong on our dollar bill( that comment is not about racism, it's about economical warfare and those who chose not to prepare which is U.S. : United we Sink)

[sjslhill]

Yup, you have a bad attitude

The New Robinhood is going to save the day....don't worry, be happy.

By 2012 you will be paying 40% more on your eletric bill as well, Cap and tax! Don't worry, be happy!

[RCprince]

The Black Robinhood is going to save the day....don't worry, be happy.

By 2012 you will be paying 40% more on your eletric bill as well, Cap and tax! Don't worry, be happy!

"Black Robin Hood" I don't think his color has anything to do with it, because if color was a factor, Rich White men have been taking us to the cleaners for centuries.

Lets remain Objective

[Bill-SOCAL]

It does to Steve. At least it seems that way since he never misses a chance to point out his color. Gets sort of tiresome, doesn't it?

Oh, and this whole bailout thing started before he became President, so like so many of his posts I do not get the point.

[RCprince]

Yea, that's to easy for me, because I could say well look, my MB 65amg in the garage makes me a better person than "you". Sexism, Classism, Racism and the rest of the ism's and schism's have no place in productive, intellectual and progressive debates... They lead to ad hominem rhetoric and distractions.

[sjslhill]

Sorry, I forget that lighter skin people cannot say the word black, it makes them a racist. I agree, his color has nothing to do with anything. I removed the word BLACK from the title.

Bill is old, he could care less if your children and grand children will be paying for all of these new programs for the next 100 years or more. Soon the debt will be billions a day just to pay the interest, Bill could care less. 900 million for Gaza! WooHoo!

Obama feeds the bears, that's his new program....

[Bill-SOCAL]

Odd, but I do not recall hearing your concern about future generations paying for our debt when Bush and the Boys were running up the debt to record levels. Why is that? Is it only an issue because Obama is doing it?

Bush took a enormous surplus and turned it into a record deficit, and not a peep of concern. Interesting.

[AndyKunz]

Mortgage, car, education, food - they're all entitlements now.

Andy

[AndyKunz]

Odd, but I do not recall hearing your concern about future generations paying for our debt when Bush and the Boys were running up the debt to record levels. Why is that? Is it only an issue because Obama is doing it?

Bush signed bills from a Congress which required a bit of bipartisanship to get anything thru. Remember, Hillary supported war. So did Biden.

Obama signs bills from a one-party Congress. Welcome to Amerika.

Andy

[sjslhill]

thoughts

Bush, did some harm...fact.

Obama will end it.....no more America like we know it. If you like Chavez, your going to love the new America. CA and it's 50 billion in debt is a good example. Hey let's tax everyone and pay off CA and all the other states that give away money.

bipartisanship? LOL, that's a buzz word. Last thing I read was WE WON!

I love the cabinet selections, paying taxes is just an option in Washington in todays time.

[sjslhill]

Here is the mortgage plan

The administration, launching what it calls the "Making Home Affordable" initiative, said that borrowers will have to provide their most recent tax return and two pay stubs, as well as an "affidavit of financial hardship" to qualify for the $75 billion loan modification program, which runs through 2012.

Feed the bears.....woohoo

Mortgage, car, education, food - they're all entitlements now.

Andy

[sjslhill]

Why Citi Group is going to be owned by the Government?

The Obama administration has backed legislation that could broaden powers of bankruptcy judges to modify mortgages for troubled borrowers. Among major lenders, only Citigroup Inc has supported such a plan.

They have too.......

[sjslhill]

Look at this and you can only just laugh...

Borrowers with loans originated before Jan. 1, 2009, will be eligible for the program, which runs through 2012. People living in their homes who have an unpaid principal balance of as much as $729,750 can participate. Feed the bears!

[Dr. Jet]

From the WSJ

The following is an interesting article I read in the Wall Street Journal:

As 2009 opened, three weeks before Barack Obama took office, the Dow Jones Industrial Average closed at 9034 on January 2, its highest level since the autumn panic. Yesterday the Dow fell another 4.24% to 6763, for an overall decline of 25% in two months and to its lowest level since 1997. The dismaying message here is that President Obama's policies have become part of the economy's problem.
Americans have welcomed the Obama era in the same spirit of hope the President campaigned on. But after five weeks in office, it's become clear that Mr. Obama's policies are slowing, if not stopping, what would otherwise be the normal process of economic recovery. From punishing business to squandering scarce national public resources, Team Obama is creating more uncertainty and less confidence -- and thus a longer period of recession or subpar growth.

The Democrats who now run Washington don't want to hear this, because they benefit from blaming all bad economic news on President Bush. And Mr. Obama has inherited an unusual recession deepened by credit problems, both of which will take time to climb out of. But it's also true that the economy has fallen far enough, and long enough, that much of the excess that led to recession is being worked off. Already 15 months old, the current recession will soon match the average length -- and average job loss -- of the last three postwar downturns. What goes down will come up -- unless destructive policies interfere with the sources of potential recovery.

And those sources have been forming for some time. The price of oil and other commodities have fallen by two-thirds since their 2008 summer peak, which has the effect of a major tax cut. The world is awash in liquidity, thanks to monetary ease by the Federal Reserve and other central banks. Monetary policy operates with a lag, but last year's easing will eventually stir economic activity.
Housing prices have fallen 27% from their Case-Shiller peak, or some two-thirds of the way back to their historical trend. While still high, credit spreads are far from their peaks during the panic, and corporate borrowers are again able to tap the credit markets. As equities were signaling with their late 2008 rally and January top, growth should under normal circumstances begin to appear in the second half of this year.

So what has happened in the last two months? The economy has received no great new outside shock. Exchange rates and other prices have been stable, and there are no security crises of note. The reality of a sharp recession has been known and built into stock prices since last year's fourth quarter.
What is new is the unveiling of Mr. Obama's agenda and his approach to governance. Every new President has a finite stock of capital -- financial and political -- to deploy, and amid recession Mr. Obama has more than most. But one negative revelation has been the way he has chosen to spend his scarce resources on income transfers rather than growth promotion. Most of his "stimulus" spending was devoted to social programs, rather than public works, and nearly all of the tax cuts were devoted to income maintenance rather than to improving incentives to work or invest.

His Treasury has been making a similar mistake with its financial bailout plans. The banking system needs to work through its losses, and one necessary use of public capital is to assist in burning down those bad assets as fast as possible. Yet most of Team Obama's ministrations so far have gone toward triage and life support, rather than repair and recovery.

AIG yesterday received its fourth "rescue," including $70 billion in Troubled Asset Relief Program cash, without any clear business direction. Citigroup's restructuring last week added not a dollar of new capital, and also no clear direction. Perhaps the imminent Treasury "stress tests" will clear the decks, but until they do the banks are all living in fear of becoming the next AIG. All of this squanders public money that could better go toward burning down bank debt.

The market has notably plunged since Mr. Obama introduced his budget last week, and that should be no surprise. The document was a declaration of hostility toward capitalists across the economy. Health-care stocks have dived on fears of new government mandates and price controls. Private lenders to students have been told they're no longer wanted. Anyone who uses carbon energy has been warned to expect a huge tax increase from cap and trade. And every risk-taker and investor now knows that another tax increase will slam the economy in 2011, unless Mr. Obama lets Speaker Nancy Pelosi impose one even earlier.

Meanwhile, Congress demands more bank lending even as it assails lenders and threatens to let judges rewrite mortgage contracts. The powers in Congress – un-rebuked by Mr. Obama -- are ridiculing and punishing the very capitalists who are essential to a sustainable recovery. The result has been a capital strike, and the return of the fear from last year that we could face a far deeper downturn. This is no way to nurture a wounded economy back to health.

Listening to Mr. Obama and his chief of staff, Rahm Emanuel, on the weekend, we couldn't help but wonder if they appreciate any of this. They seem preoccupied with going to the barricades against Republicans who wield little power, or picking a fight with Rush Limbaugh, as if this is the kind of economic leadership Americans want.

Perhaps they're reading the polls and figure they have two or three years before voters stop blaming Republicans and Mr. Bush for the economy. Even if that's right in the long run, in the meantime their assault on business and investors is delaying a recovery and ensuring that the expansion will be weaker than it should be when it finally does arrive.