Capitalism doesn't work if there isn't punishment for poor decisions and leadership. Freddie and Fannie were a quasi-Socialists "Government Sponsored Enterprise" and so nationalizing them is something that had to be done.
Watching Bears Stearns go at a fire sale - and now Merrill Lynch - good. What I want to see, and we should all demand to see, are some perp walks. These problems all came from arrogant, greedy, deceitful leadership at these companies. They are no different from the pickpocket, the car their, or the con man that preys on the elderly. These people need to go to jail because due to their greed - billions have vanished from the accounts of millions. If you or I did this we would go to jail. People need to go to jail.
I'll steal this quote from Gary Kaltbaum.
FNM and FRE own or guarantee almost $6 trillion in US home loans. So, one could argue that this is a good move by the government. Of course, you and I are screwed as we are going to foot the bill. Since we are going to foot the bill, can we vote on just who is going to run the joint now? This is not how capitalism is supposed to work!I said awhile ago that this is an issue perfect for the McCain team. It looks like they might just run with it. A little of Gov. Palin from this weekend.
As of this writing, both common and preferred holders are toast with the debt holders being covered by the government. But is the government going to backstop all the small and mid-size banks that were forced into buying all the preferred stuff? They are waaaaaaaaay underwater, with some possibly illiquid because of these investments.
What is left in the bag when (I mean if) General Motors (GM) goes bye-bye? Where does this end? The castration of the American taxpayer continues.
Is anyone going to jail? How does Frank Raines get away with a monstrous fraud with no penalties, and a fine he doesn't have to pay?
I close with a quote by Davy Crockett. HUH? Yup...Davy Crockett... I wish Davy Crockett was still alive. This dude made sense! Obviously, Uncle Al, Uncle Ben and Uncle Hank never read these words. And yes, I freely admit that I saw this on another website.
Davy Crockett's "Not Yours To Give" Speech In Congress:The power of collecting and disbursing money at pleasure is the most dangerous power that can be entrusted to man, particularly under our system of collecting revenue by tariff (Note: There were no income taxes in the 1800s when this was written, most government revenue came from tariffs), which reaches every man in the country, no matter how poor he may be, and the poorer he is the more he pays in proportion to his means.
If you have the right to give to one, you have the right to give to all; and, as the Constitution neither defines charity nor stipulates the amount, you are at liberty to give to any thing and everything which you may believe, or profess to believe, is a charity, and to any amount you may think proper. You will very easily perceive what a wide door this would open for fraud and corruption and favoritism, on the one hand, and for robbing the people on the other. No, Congress has no right to give charity. Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose.
- Davy Crockett's "Not Yours To Give" Speech In Congress