Bail-out is a transfer of power from US govt to the banks

Cid_Yama

"(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;"

That's right - every bank and other financial institution in the United States has just become a de-facto organ of the United States Government, if Hank Paulson thinks they should be, and he may order them to do virtually anything that he claims is in furtherance of this act.

This might include things like demanding that a bank or other financial institution sell him its paper, even if it forces that firm to collapse and be assumed by the FDIC! You didn't buy any bank stocks last week did you?

"(a) Authority to Purchase.—The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States."
This, at first blush, would seem to indicate that only American firms would be covered. Nothing is further from the truth. If the Chinese wish to unload some of their purchased toxic sludge they merely sell it to, oh, Goldman Sachs for 40 cents on the dollar and then Goldman sells it to the Treasury for 50.

This, under the black letter of the law here, is perfectly legal, which means that one must assume that Paulson will in fact foist off all the bad paper on world markets that was originally based on a mortgage in the United States, while allowing his banker buddies here to loot the taxpayer by acting as an intermediary in the transaction!

Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
If you are a bank, investor, or other entity who is forcibly gang-raped by Secretary Paulson due to his actions as "King" (crowned by Congress) under this law, you are unable to seek redress in the courts or by administrative action. The claim is that this is intended to "promote confidence and stability" in the financial markets. It will do no such thing.
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Look at the Federal Reserve Act. If you relinquish power, you NEVER get it back. This is the end of the United States of America. The final usurpation of power is upon us.
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In a time of universal deceit, telling the truth is a revolutionary act. - George Orwell

It riles them to believe that you perceive the webs they weave. - Moody Blues

35Kas · Tar Sands Joined: Feb 04, 2008 Posts: 76

{edited: Code of Conduct violation-MD}

Cid_Yama

This from Illargi at Automatic Earth:

Lost among the hundreds of billion in rescue funds for financial institutions, supplied by the taxpayer, are the "reform"measures that are being considered. The core of the proposals is yet another transfer of power, this time over the financial world, in all its aspects, and on an international scale. Once again, the powers are to be taken away from the people’s representatives. This time the powers in question will be handed over to the Federal Reserve.

And that means that the status of America as a functioning democracy becomes ever more questionable. Yesterdays anouncement by the government, and the gigantic new rescue plan -the next in a by now long list- that will be unveiled within the next 72 hours, made some European leaders cast doubt on US claims of propagating a free market.

The way in which this process is undertaken can perhaps best be illustrated by the founding of the Federal Reserve in 1913. The Constitution explicitly and expressly reserves the control over the nation’s money supply to Congress. 95 years ago, an interpretation of this was accepted that stated that this meant Congress could hand over the control to whomever it pleased. And it decided, in a weird session, to cede its Constitutional power to the Federal Reserve, which was and is made up of a select group of private bankers.

But let’s seek an analogy here. Say that I have, with the consent of both teams, been named the referee in a football match. Does that imply that I have the right to, at any point during the game, hand over the whistle to the local drunk, to the coach of one of the teams, or to the town bookmaker who has vested interest in a favorable outcome? It may be a hard question to answer, but I would venture to say no such right is implied.

Ben Bernanke was not elected by the people. Yet, he will be handed (even more of) the power of the nation’s money. And power over the economy is power over the nation itself. No matter what grand plans Congress comes up with, if you refuse to fund them, they ain’t happening.

Hank Paulson was not elected by the people. If you think there’s no connection between Paulson being Goldman’s CEO for 8 years, and the fact the Goldman will now be able to bury an insane amount of toilet paper in the contaminated RTC composter that is being set up in the capital's backrooms, at the same time that shorting Goldman is banned, then I want some of the drugs you’re taking.
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What in holy hell is an RTC? Good question.

So all the banks and big companies that lost money can take all their CDOs, CDSs, subprime stuff and every other shitty investment that backfired, and stuff them into a big trash can euphemistally called a Resolution Trust Corporation. This has two huge advantages - it legally protects them from debt repayment problems and other subtle bankruptcy problems, and it shores up their balance sheets and immediately enables their share price to skyrocket now the debt has gone bye-bye.

Immediately, previously-insolvent investment banks can now go and borrow money and act like this whole business was just a meaningless, forgetful night of snorting coke from a hooker’s ass.

Now the RTC has to be supported by Uncle Sam, who basically has to put the infrastructure budget for - well - pretty much everything on hold and start printing money 24/7.

The great American taxpayer gets left by massive T-bill repayments together with a multi-trillion debt that will take generations to pay off, and the people in investment banks can start buying Ferraris, golf courses and private jets.

Now if I could use an RTC, I’d be happy. Just to emphasize how glorious this scheme really is, think about it as if an RTC existed for your family. Here’s how it would work for mine:

I dump all my credit card debt, mortgages, car loans, college loans and every other damned rope around my neck and stick it in the RTC.

I go and get new credit cards and start all over again.

My neighbors figure out how to pay off the RTC while I can’t decide on the trim for my new Mercedes.

link
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In a time of universal deceit, telling the truth is a revolutionary act. - George Orwell

It riles them to believe that you perceive the webs they weave. - Moody Blues

neocone · Heavy Crude Joined: Sep 23, 2006 Posts: 257

1) Buy a gun
2) Learn how to use it

In an urban environment where heavy military means are useless the pistol is king and the true definition of a citizen's power.

Madpaddy · Expert Joined: Jun 25, 2004 Posts: 2130

neocone wrote,

bl00k

TheDude

Madpaddy · Expert Joined: Jun 25, 2004 Posts: 2130

Thanks for that Dude.
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Roccland · Peak Oil Prophet Joined: Jun 16, 2007 Posts: 1696

Byron100

What if, by some out-of-the blue miracle, Congress decides that the Federal Reserve needs to go, and the President agrees...couldn't a law be passed to make it go poof? Is it possible for a group of people to put together a court case and take it to the Supreme Court to rule the Federal Reserve as unconstitutional?

Or better yet, is it possible that the rest of the world could gang up against the US with a threatened embargo to force our hand? "Dump the FED and your money-printing ways, or you get zero oil from outside your borders."

Or is all of this just wishful, pie-in-the-sky thinking?
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Nowhere to run, nowhere to hide...
...and the meek shall inherit the Earth!

mos6507

Cid_Yama

What is outrageous, is they are proposing to give the financial institutions the power to run their own bailout and TAX(because that's what it is) the taxpayer to cover the bill, while taking away the right of Congress or the Supreme Court to challenge their actions.

We are talking the wholesale gutting of the Constitution, the end of the seperation of powers, the end of self-government for the American people.

We are facing taxation without representation(one of the causes of the American Revolution), and the subjegation, the enslavement of the American people for generations to come, to pay a debt they did not incure, while handing the ultimate power to a ruling class.

This is not a bailout, this is a coup. It is the overthrow of the United States Government and the enslavement of it's people.

The easiest way to defeat this coup is to just say no to the bailout and let them fall under the weight of their own debt.

Will that happen? No, because they have already purchased the representatives of the American people, who will sell us all for 30 pieces of silver.
_________________
In a time of universal deceit, telling the truth is a revolutionary act. - George Orwell

It riles them to believe that you perceive the webs they weave. - Moody Blues

Cid_Yama

The Dude,

I loved that movie. Anyone who hasn't seen "They Live", needs to.

It's a great movie.

http://en.wikipedia.org/wiki/They_Live
_________________
In a time of universal deceit, telling the truth is a revolutionary act. - George Orwell

It riles them to believe that you perceive the webs they weave. - Moody Blues

AlCzervik

HuffPo: Welcome to the Final Stages of the Coup.
Mike Whitney: Mushroom Cloud Over Wall Street: The Days of the Republic Are Over.

americandream