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Amazing that this has not hit the MSM yet, but the banks themselves are saying they need between 3 and 4 trillion to remain solvent.

Despite this, we are starting to hear about government waste in conjunction with the stimulus.

Back just a few months ago, we gave a $350 billion to banks.  That is not the total of our spending and committments.  Estimates as high as $7.8 Trillion of monies already committed to help save our economy.

The $7.8 trillion of already spent money does not include the additional stimulus necessary to get our economy moving.  My estimate is that we will need $1.5T of additional spending.  

Add the numbers up and we are talking about over $13 Trillion, a full year of U.S. GDP, in government spending to clear out the mess caused by the banks and unregulated mortgage securitization practices.  In other words, last year, you worked to make sure rich guys could get their bonus.  

When the right wing or the MSM starts talking about the wasteful spending that is part of the stimulus, remind them of two things:

  1.  The stimulus would not have been necessary with proper regulation
  1.  The waste you are talking about is a rounding error to what we have and will give the banks.


Originally posted to mickslam on Wed Jan 21, 2009 at 12:47 PM PST.


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Comment Preferences

    •  If the "professionals" have dug themselves (2+ / 0-)
      Recommended by:
      skrymir, Mz Kleen

      into that deep of a hole, nationalization is the only option.  Better do it quick before they lose another $ Trillion.

      "Nothing is more powerful than an idea whose time has come." Victor Hugo

      by lordcopper on Wed Jan 21, 2009 at 01:33:03 PM PST

      [ Parent ]

    •  The banks have FAILED. (0+ / 0-)

      We hear about how friggin' great the market economy is...Well, that BS is fully exposed.

      We're just covering for their absolute failure when we prop these guy up. The executive teams should be forced out...and, in some cases, prosecuted.

      These people with all this money are incompetent, greedy and unworthy of our respect. It's time to reward the hard-working people, the honest people (especially whistle-blowers), and the productive.

      American management, by and large, is a failure because productivity and innovation and genius is NOT rewarded, but punished. Only moving numbers on a balance sheet is rewarded. And this is what makes capitalism just as big a failure as communism.

      When a government violates the unalienable rights of the people, it loses its legitimacy.

      by Rayk on Wed Jan 21, 2009 at 03:10:43 PM PST

      [ Parent ]

      •  Well... (0+ / 0-)

        as we all know, unregulated capital creates monopolies. The process is ugly. The rich get richer. The big get bigger. Finally, nothing is left except a small oligarchy, their handservants (police and politicians), and an enormous laboring class trapped in drudgery--if they're lucky!

        Teddy Roosevelt derailed this "vision" of the 19th century robber barons, and FDR created regulatory counter-measures and social safety nets that entrenched the role of the government as the last defender of the non-mercantile among us.

        But just as a capitalist society that values only profit (and immediate profit, at that) is doomed, a communist society that allows no outlet for people's natural entrepreneurial drives is also doomed. Obama's about to rescue capitalism (like FDR did) by creating something new--social capitalism?

        •  Hmmm, I think just capitalism with (0+ / 0-)

          some regulations.  Social democracy?

          You should read some hyman minsky.  He shows that capitalistic societies are inherently unstable.  You would think this would be common knowledge among economists, but apparently not.

          I am repeating myself, and thats ok.

          by mickslam on Thu Jan 22, 2009 at 07:00:23 AM PST

          [ Parent ]

  •  Let me get this strait (2+ / 0-)
    Recommended by:
    mickslam, lordcopper

    Our banks are telling us they are insolvent?

    How in the hell did that happen?

    We shall overcome, someday. Yes we can.

    by Sam Wise Gingy on Wed Jan 21, 2009 at 01:32:49 PM PST

    •  Well, if they say they need trillions (1+ / 0-)
      Recommended by:

      to get rid of the bad paper they are holding, and their equity is worth only billions, then the next, logical step is that they are already bankrupt.  They just have not admitted it yet.  

      I suspect this is probably be a prosecutable crime, but that it will not be prosecuted.

      I am repeating myself, and thats ok.

      by mickslam on Wed Jan 21, 2009 at 02:30:19 PM PST

      [ Parent ]

  •  So they aren't solvent then, are they? (2+ / 0-)
    Recommended by:
    skrymir, Mz Kleen

    Nationalize or Bankruptcy -- both ways the owners/shareholders should do the free market thing and lose their bad speculation.

    Stimulus-wise there are lots better ways of stimulating the economy than pouring good money after bad.

    --Goodbye. Glad to see you go.

    by anonymous coward 8 on Wed Jan 21, 2009 at 01:42:09 PM PST

  •  Banks that are underwater (0+ / 0-)

    shouldn't be closed just as people who are underwater shouldn't be blindly tossed out of their houses.

    As long as they meet their obligations and are prudent in current and future actions, they should remain in their premises.

    [I own shares of Citigroup.]

    •  The executive teams of these companies (0+ / 0-)

      deserve to be fired. They failed. Instead, they get fat bonuses...paid for by WE THE PEOPLE.

      That's wrong and guarantees that the pigs will continue feeding at the trough.

      (I have close relatives working at Citigroup...but I believe in justice...not selfish-interest.)

      When a government violates the unalienable rights of the people, it loses its legitimacy.

      by Rayk on Wed Jan 21, 2009 at 03:07:34 PM PST

      [ Parent ]

  •  Absolutely outrageous! (1+ / 0-)
    Recommended by:

    Time to nationalize!

    If the people lead, the leaders will follow.

    by Mz Kleen on Wed Jan 21, 2009 at 01:59:39 PM PST

  •  If FDIC insured banks have issued CDOs (0+ / 0-)

    then the payouts on those CDOs should be held pending solvency sort of like depositors' checks are.

    FDIC insured depositors must come first.

  •  If what you say is true (0+ / 0-)

    The USA is bankrupt.  Or should I say, we went bankrupt faster then I thought.

    The government is already very close to their debt ceiling.  China has already hinted that they are getting close not taking more USA Fed debt.  This means that the government spending spree is only a few years away from being over.

    How much bigger a deficit can we actually run this year anyways?  Money doesn't grow on trees so we need to find someone willing to loan us this money.

    We are in a spot where the moment the recession is over, Obama will have 2 choices:

    1.  Drastically reduce government spending with large spending cuts to military and entitlement spending coupled with large tax increases on the top 5% of income earners.  He will have to keep cutting at the government budget until he produces a sizable surplus year after year.
    1.  Allow the pending hyper inflation to take care of our debt.  Of course this route means a future deression and most Americans ending up bankrubt.

    2 difficult choices.  I know which one I would go with....

  •  Save the economy (0+ / 0-)

    I'm going to buy food from the supermarket if I'm hungry.

    I'm going to fix the roof if it leaks.

    I'm going on trips if I don't have to take care of my aunt.

    I'm going to the doctor as needed.

    I'm still paying for Internet and telephone service.

  •  If banks don't trust each other, so what? (0+ / 0-)

    Let them lend excess funds to the FDIC, the FDIC can then relend the money.

    This way the FDIC can more easily keep watch on the banks.

  •  The fat cat pigs had their time at the trough... (0+ / 0-)

    Now, make them pay back the money they stole...and help the honest working people of this country.

    I pray that the day of the plutocrats is over.

    When a government violates the unalienable rights of the people, it loses its legitimacy.

    by Rayk on Wed Jan 21, 2009 at 03:05:53 PM PST

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