If you believe that Obama & co. want to destroy the capitalist system, this would be the way to do it.

Stop with all the “experts” who caused this disaster, providing advice on how to ‘fix’ it.
Stop with all the trial balloons and abortive ‘ideas’ to do little more then spend more money the country does not have, further and further putting our very existence into the hands of our political, social and ideological enemies.
Government, do your damned JOB.
Protect the country from our enemies, and let the market figure out the solutions.
Federal “help” is one step, one very small step, from Federal take over.
Take over by a bunch of knuckle heads who allowed and often facilitated this mess in the first place.
Fox, hen house….any questions?

Nationalized investment banking is a whole different kettle of fish. It’s interesting that not only did this only get reported in one place, it’s breaking on a Friday.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.

Folks we are getting to this point – we need to throw this in the socialists faces everytime we confont them.

The government can’t seem to herd everybody willingly toward dependency on an all powerful central body, so they’re quite willing to force dissenters into it, willingly or not.

Everything, that’s been done has been for this end. Unfortunately, most won’t realize it until it’s a done deal.

I don’t have a big problem with this based on two assumptions:
1. The problems with understanding the risk of the security have been resolved. I presume that people were buying these without understanding the risk of the security.
2. The government is doing this only to salt the jar and to prove out that the securities are transparent and safe. If they are, then the government is not taking a risk that isn’t insane. I can see the government taking some additional risk only to get the markets moving again on their own. They can sell their leverage out to another group perhaps?

That said, the free marketer has to ask why the money is still on the sidelines. Is it because the securities are still not transparent? If they aren’t, FIX THAT.

Other than the scale. Perhaps MoveOn.org was just a front in a George Soros scheme to rip off US taxpayers. Of course, he had a lot of useful idiots to help him.

</snarkiness>

Who am I trying to kid?

<snarkiness> … to be continued

His take was a little different and described differently that what is being reported. If someone can find the tape from Wednesday nights Kudlow Report around the 7:30 EST it may relate.

No question as reported in the Times piece it would be a disaster with way too much leverage. There may be a role to play for the government, but direct investor would not be a good choice.

If there truly is the possibility for 20% profit in these new securities, the government could just buy them directly and give the tax payers the upside benefit of the risk. If there truly is private capital interested in these securities, but frozen by fear, then the fact that govenment action has created a market for the securities ought to give them some confidence to enter the market. Private and public equity would be competing as buyers. Government as competing investor for “assets” (not firm ownership). That no doubt creates a different set of hazards, but might they be preferable.

I suppose I ought to conclude that this must be an entirely naive approach since it is nowhere advocated. The obvious problem is that the government is too big and conflicted by politics to rationally act on risk/price analysis. Perhaps this could be viewed as an analogue to Paulson’s original plan, directed not at existing securities but new ones.

as I did when a talk show host asked “Will the stimulus work as intended?” to his audience at large: Yes, it will work as intended, just not as it was advertised.

Somebody who told Joe the plumber than anyone making more than $250K a year should expect that their earnings would be “spread around” has no respect for our country and our economic system. His intention is to replace it with something he envisions as being “fairer” without regard to whether or not the majority, let alone a supramajority of the American people want.

I held my nose and voted for John McCain in the election because I knew the cost of electing a Socialist as president was going to be high. It appears I didn’t figure high enough when I calculating how high it would be, even though I thought I might have been being pessimistic at the time.

then why would they need leverage to purchase securities.

I think allowing more leveraged asset purchases is a really really bad idea. Leverage is what got us into this mess.

Remember the invisible hand.

The money is not on the sidelines, it’s where it always was: earning the safest ,best return possible. Right now, that is NOT in mortgagecredit backed securities.

If mortgage- (or credit-) backed securities look safe and productive in the future, then the money will return to those instruments.

Conservative traders would probably feel like they are pointing a gun at their own head (if they don’t have a kitchen garden and a chicken coop behind their house [but what about zoning laws]). But the younger traders, as ill-educated as they are, (and they are legion) might go for it.

Carefully load gun…

Carefully take aim at foot…

Pull trigger…

Carefully reload…

Carefully take aim at foot…

If it walks like a leaked trial balloon and quacks like a leaked trial balloon, then it probably is…

More of us should be sitting up and taking notice of this.