COCKTAILS (OF THE TOXIC VARIETY) ON THE HOUSE
Well, well, well. Look who's taking advantage of the "Geithner Plan." Ritholtz has a short piece about Citi and BOA buying toxic assets lately:
Especially when you consider that the money they'll spend to make these market-rate purchases came directly from the taxpayers in the form of "bailouts."
I believe this is called playing with house money. And we're the house. But unlike Vegas (and Wall St.), in this example the house always loses.
As Treasury Secretary Tim Geithner orchestrated a plan to help the nation’s largest banks purge themselves of toxic mortgage assets, Citigroup and Bank of America have been aggressively scooping up those same securities in the secondary marketThis is the logical outcome of Timmy's "Plan." If you know the government is gonna broker a bunch of deals to buy garbage at above-market prices (through outright purchase, leveraging, guarantees, etc), why the hell wouldn't you buy up as much of that garbage as possible at the current market prices? That's good business, right?
* * *
both banks have been [aggressive] in their buying, sometimes paying higher prices than competing bidders are willing to pay.
Especially when you consider that the money they'll spend to make these market-rate purchases came directly from the taxpayers in the form of "bailouts."
I believe this is called playing with house money. And we're the house. But unlike Vegas (and Wall St.), in this example the house always loses.
posted by Mike at 7:12 AM
11 Comments:
This is logical. It makes good business sense.
It's not good for the USA, but the banks are corporations. They don't owe the USA any allegiance. They exist to extract money and give it to their owners. that is their purpose. The rest is incidental.
So Dumbya and Fauxbama are back-to-back Yeltsins. Handing it all over to Goldman, Morgan, PIMCO, Blackrock, etc.
Who is going to be the American Putin, I wonder? Putin is popular in Russia, notwithstanding his anti-Democratic actions in office.
Wanna know why Putin is so popular there, despite being a Tyrant? Because Russia got robbed blind by the Oligarchs and Putin has stuck it to them.
Fauxbama believers: you are suckers.
Applesaucers
Obama Seeks Input From Banking CEOs
Images of foxes and hen houses spring to mind.
Yeah Obama is leading a brainstorming session to find a way to keep stealing, without pissing us off.
They don't owe the USA any allegiance. They exist to extract money and give it to their owners. that is their purpose. The rest is incidental.
Yet we're supposed to believe that the banks' health is instrumental to our economy.
Dumbya and Fauxbama are back-to-back Yeltsins.
Looks that way.
Images of foxes and hen houses spring to mind.
Yeah Obama is leading a brainstorming session to find a way to keep stealing, without pissing us off.
Horrendous.
It's the Mussolini business model at work, and mark my words. it's going to cause one helluva shitstorm going forward.
It's the Mussolini business model at work
Does that mean at least we'll get a public transportation system with trains that run on time?
As you have probably surmised, Mike, it's the Mussolini business plan minus enhanced functioning of public transport.
Let's hope we can avoid the Mussolini governmental plan.
And now you know how the bank's managed their very temporary profitability in January and February.
http://zerohedge.blogspot.com/2009/03/exclusive-aig-was-responsible-for-banks.html
Yes Mike, the papers will always report that the trains run on time.
Just remember, Ignorance is Strength.
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