How To Pass the Damn Bailout
“Recovery plan” my a… nevermind.
Merrill Lynch sold $30.6 billion of collateralized debt obligations (CDOs), the kind of toxic paper that’s currently clogging the arteries of the financial system, for $6.7 billion, or about 22 cents on the dollar. This is the same toxic debt that our (as in yours and my) 700 billion dollars is supposed to be taking off the hands of former investment banks (Goldman and JPM) and other players, some of whom were nefarious, and some of whom were unwitting.
So 22 cents on the dollar is the benchmark that was arrived at in the free market prior to the uber-meltdown.
And that’s the cap that should be put on the price that Uncle Sam (meaning we, the taxpayers) pay for the same garbage. This doesn’t mean that’s the price we should pay, it just means that’s the most we should pay.
If Buffet can work out a sweetheart deal with Goldman, we the people should also be able to hold Goldman and other institutions over the same barrel.
Convince the taxpayers that we’re getting a Buffet-like deal, one similar to the one that Merrill had to settle for, and I think those pesky folks who have the unmitigated nerve to ask how their dollars are being spent, will stop calling their representatives in DC, or at least call and tell them to pass the bailout and try (over the long haul) to make some money from it.
It’s only then that we can all begin the arduous process of getting credit flowing and find our way towards the new business as usual.
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Amen to that…
be damn lucky if we can cap it at 100 cents on the dollar. 700 billion, and zero oversight, disposed of by a guy whose past – and future! – career is in investment banking.