Another $25B

Right on schedule, GM is lined up to get $25B of taxpayer dollars. Is anyone still keeping count of the total tab? I'm at $2.1 trillion. But really when you get into numbers that high, it's impossible to know. $2.1 or $2.8, who the hell knows. It might as well be 100 trillion. No matter what the number is, it will never be paid off. My kids and their kids and their kids and their great great great great grand kids will still be paying this shit off. Just so Henry Paulson and the CEO of GM can continue attending the country club dinners.

I missed the speech by our Glorious W Leader last night. Forgot all about and just as well. Had I watched it, my TV would probably have a big hole in it this morning. Reading the text of it I see I was right. A bunch of bullshit about how the government will make money off this mess. Here is why it's bullshit:

The government claims it will buy worthless mortgages and sometime in the "future" sell those mortgages for a profit as the housing market improves. So many flaws with this argument..

1. That "future" could be 20 or 20 years from now. If you think that's unrealistic, think again. It took from 1929 to 1954 for the stock market to get back to pre-crash levels. Nasdaq is today - 8 years later - less than 50% of the value it was at the peak in 2000. There are some areas of Texas were house prices today are about where they were in the mid 80s, at the height of the Texas oil-led real estate boom. Adjusted for inflation those houses are worth pennies on the dollar compared to the peak value. Sounds like our Great W Leader has been reading NAR press releases and thinks now is a great time to buy.

2. How will our Great W Leader and his sidekick min-Great Leader Paulson know what the true value of the loans are. There is absolutely no way to know. It will be a guess and nothing more. And it will invite unimaginable corruption. Basically it will be up to a bureaucrat somewhere to determine the value of every single CDO held on the books. And how easy would it be to bribe that bureaucrat to say your particular bank's CDOs are worth 50 cents on the dollar instead of 30 cents. Since nobody has any way to prove or disprove that amount, you can't even prove corruption if you try.

3. If this is such a great deal for the government, why doesn't someone do it in the private sector? The reason the govt has to step in is because the private sector knows these junk loans will never be paid back. The value of them is $0. And it will be $0 forever. If there were truly profits to be made as our Great W Leader says, believe me Goldman Sachs would be all over it.

4. Again, if these junk loans are really discounted future profits, why not just have the banks hold on to them? Say you have a CDO that you KNOW (according to the Great W Leader) will be worth more in a few years. Why on earth would you sell it at a discount today?

None of it makes any sense. No matter how the Great W Leader spins this, it all comes back to a $2T give away to banks by taxpayers. And it is fucking disgusting. And because it is absolutely the wrong thing to do, it will be passed by congress with a huge majority.

RIP AMERICA
1776-2009