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Discuss Too much control at the Politics & Religion within the Wrestling Talk Forums; http://online.wsj.com/article/SB123879833094588163.html This seems to makes sense to me. If the banks wanted to either not ...
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    Super Moderator UGLY's Avatar
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    Default Too much control

    http://online.wsj.com/article/SB123879833094588163.html

    This seems to makes sense to me. If the banks wanted to either not accept the money or give the money back but was forced to keep it, that is a bit much for me. No other reason to do this except to have power over them.

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    ODH
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    Default Re: Too much control

    Quote Originally Posted by UGLY View Post
    http://online.wsj.com/article/SB123879833094588163.html

    This seems to makes sense to me. If the banks wanted to either not accept the money or give the money back but was forced to keep it, that is a bit much for me. No other reason to do this except to have power over them.
    Why was the money forced on them to begin with?
    I have heard this from enough sourcces to believe it is essentially true and this was done under Bush.
    My two thoughts on this are that the Treasury Dept. did not want all the $$$ just to go to the worst of the worst baks, because they are the most likely to fail and if a high percentage of the banks that get bailout money fail, it makes the whole bailout program look horrible. So the Treasury convinces some banks who don't need it to take the money... I can't see how they can literally force a bank to take the money.

    In addition, if you are a bank and in the business of borrowing and lending money and someone comes in with a whole bunch of capital to give a rates way below the market, it would be foolish not to take it, especially when all your competitiors are being bail out and have cheap money to do business with.

    Since this was the policy under Bush and I don't believe there has been a huge socialization of the Treasury department, I suspect the policy is still continuing. The author's premise that This is a whip with which to thrash the unpopular bankers, a tool to advance the Obama administration's goal of controlling the financial system. is way too political for me to believe that is the reality of the situation. Obama may have an ambitious agenda (remember he is trying to turn the US into a European State) but national control of private banks does not seem to me like something he really wants.
    To me it sounds rather like the accusations of Bush invading Iraq so we could get cheap oil.

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    Default Re: Too much control

    Quote Originally Posted by ODH View Post
    I have heard this from enough sourcces to believe it is essentially true and this was done under Bush.
    The money may have been forced on by the Bush administration, but it is being refused by the Obama administration.

    One was dealing with a crisis as it happened the other is saying the crisis isn't over and they need to keep the money so they don't have to dish it out again - assuming the collapse could continue to get worse... if they're healthy they can hold the money and give it back in a year with very little financial risk.

    Who handed it out isn't a problem if the money is still there and able to be given back after the crisis ends.

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    Default Re: Too much control

    Part of the issue beyond control over pay and bonuses, TARP cash also bars the receiver from paying stock dividends to it's shareholders. That supresses stock value which is the ultimate driver in the business world.

    The original plan for the cash was for the banks to be able to refi loans to those on high rate ARMs, thereby allieviating the foreclosure rate. The big issue for the banks is valuing the property so they're offering secure loans. Since the housing prices have fallen, the banks are unwilling to refi a loan that is underwater (loan value higher than resale value).

    To give you an example, my son bought a place in 06. He took a 7 year ARM at 5.8%, a fair rate at the time. He's got a secure job, has never missed a payment and continues to build a savings acount in addition to his 401, all while redoing the entire place for $15,000. He's pretty solid financially. With fixed rates down at 4.5% he wanted to refi which would have given him a lower monthly payment and eliminated mortage insurance of $80 per month. He was even adding cash in to lower the loan value. The bank he's with is solid financially, no Fanny contamination. The bank turned him down, not because of any question in his ability to pay, but solely because they didn't believe they could appraise the value of his place to get a loan/value ratio. Instead of just looking at what he has now and his ability to pay under the new financials, they're solely concerned with extending a loan that exceeds to resale value. I mean c'mon, what's the loan/resale ratio right now? It's pretty clear the bank would profit less off his new loan and they're boxing him in.

    He's talked to other banks, same situation since there have been no home sales in his area for 8 months they won't loan because they don't feel they can value the place.
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    Super Moderator UGLY's Avatar
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    Default Re: Too much control

    Quote Originally Posted by ODH View Post
    Why was the money forced on them to begin with?
    I have heard this from enough sourcces to believe it is essentially true and this was done under Bush.
    My two thoughts on this are that the Treasury Dept. did not want all the $$$ just to go to the worst of the worst baks, because they are the most likely to fail and if a high percentage of the banks that get bailout money fail, it makes the whole bailout program look horrible. So the Treasury convinces some banks who don't need it to take the money... I can't see how they can literally force a bank to take the money.

    In addition, if you are a bank and in the business of borrowing and lending money and someone comes in with a whole bunch of capital to give a rates way below the market, it would be foolish not to take it, especially when all your competitors are being bail out and have cheap money to do business with.

    Since this was the policy under Bush and I don't believe there has been a huge socialization of the Treasury department, I suspect the policy is still continuing. The author's premise that This is a whip with which to thrash the unpopular bankers, a tool to advance the Obama administration's goal of controlling the financial system. is way too political for me to believe that is the reality of the situation. Obama may have an ambitious agenda (remember he is trying to turn the US into a European State) but national control of private banks does not seem to me like something he really wants.
    To me it sounds rather like the accusations of Bush invading Iraq so we could get cheap oil.

    Then why dont they let them give the money back. The head of Wells Fargo has said they were forced to take money and that they were forced to keep it under Obama. Why not let them give it back unless you want to maintain the control over the banks that TARP gives you. Obama and the Dems wanted more regulation what better than this, they have control.

    One nice deal for the Republicans is that with Obama now taking over GM and the Banks, if they fail it will be seen as Obama failing. I heard this on meet the press.

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    ODH
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    Default Re: Too much control

    Quote Originally Posted by UGLY View Post
    Then why dont they let them give the money back. The head of Wells Fargo has said they were forced to take money and that they were forced to keep it under Obama. Why not let them give it back unless you want to maintain the control over the banks that TARP gives you. Obama and the Dems wanted more regulation what better than this, they have control.

    One nice deal for the Republicans is that with Obama now taking over GM and the Banks, if they fail it will be seen as Obama failing. I heard this on meet the press.
    I don't get why the money was forced on them
    I don't get why they are not being allowed to give it back.
    But I don't believe it is evil plan to take over the banking system.

    I think Obama getting the blame for this is wishful Republican thinking.
    Also sounds like they are hoping for further economic failure for political gains.

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    Default Re: Too much control

    Quote Originally Posted by UGLY View Post
    Then why dont they let them give the money back. The head of Wells Fargo has said they were forced to take money and that they were forced to keep it under Obama. Why not let them give it back unless you want to maintain the control over the banks that TARP gives you. Obama and the Dems wanted more regulation what better than this, they have control.

    One nice deal for the Republicans is that with Obama now taking over GM and the Banks, if they fail it will be seen as Obama failing. I heard this on meet the press.
    Ah grasshopper...Obama will not fail, much to the chagrin of the 20%r's. The repubs are meaningless. See Bachman.

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    Default Re: Too much control

    Quote Originally Posted by washed up wrestler View Post
    Ah grasshopper...Obama will not fail, much to the chagrin of the 20%r's. The repubs are meaningless. See Bachman.
    Brilliant... In reality, America will not fail, though it has very little to do with Obama, McCain, or anyone who would have taken office. The President will receive credit for navigating the ship through the storm, but in reality, its because people of all ages will come together, struggle, and eventually prevail.

    I don't know where you get the "20%-er" non-sense.. sounds about as accurate as the recent "90% of the weapons found in the illegal drug trade in Mexico are from America".

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    Default Re: Too much control

    Quote Originally Posted by ODH View Post
    I don't get why the money was forced on them
    I don't get why they are not being allowed to give it back.
    But I don't believe it is evil plan to take over the banking system.

    I think Obama getting the blame for this is wishful Republican thinking.
    Also sounds like they are hoping for further economic failure for political gains.
    I agree. Obama isn't trying to become the Bank & Auto CEO of America like FoxNews would like you to believe.

    I also feel the Republican's in power hope the economy continues to worsen to gain politically... pretty obvious if you listen to any of them. They make decent points (Increasing debt to fix a debt problem, over spending on stimulus, etc), but really seem to have ulterior motives.

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