Comments on: Senators Hold Personal Stake in Bailed-Out Banks

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The Financial Crisis: Waiting to Avoid « — Sun, 06 Feb 2011 23:50:11 +0000

[...] ↩The Washington Independent, 07.02.09 [...]

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By: Capital One Personal Loans - Residential Finance Corp. Hiring, Has Jobs for Experienced, Successful - dBusinessNews.com « Capitals Loans

Thu, 09 Jul 2009 04:58:56 +0000

[...] Senators Hold Personal Stake in Bailed-Out Banks – The Washington Independent.comA senator’s financial disclosure forms. The senators who voted last fall to approve the federal bailout of Wall Street hold hundreds of thousands of dollars worth of stock in the very banks that Washington has rescued in the nine months since. Of the [...]

By: Capital One Personal Loans - Senators Hold Personal Stake in Bailed-Out Banks - The Washington Independent.com « Capitals Loans

Tue, 07 Jul 2009 09:31:15 +0000

By: Senators bailing out banks in which they’ve invested « Later On

Senators bailing out banks in which they’ve invested « Later On — Mon, 06 Jul 2009 00:22:08 +0000

[...] ugly, and unfortunately confirming the degree to which Senators look out for themselves first. Mike Lillis: The senators who voted last fall to approve the federal bailout of Wall Street hold hundreds of [...]

By: Capital One Personal Loans - Senator Inouye Helped His Personal Bank Get Bailout Money - Huffingtonpost.com « Capitals Loans

Sun, 05 Jul 2009 20:47:14 +0000

By: danstephens

danstephens — Sat, 04 Jul 2009 01:16:26 +0000

If the lawmakers motives were partly self-interest to save their common stocks in the lenders, they should realize the great irony that TARP funds will not save out the lenders; their stocks could still hover near zero for years, and some could be bankrupted, in absence of a much more effective federal program to ease the credit crisis. The hundreds of billions of home equity loans the lenders wrote at 90-100% combined loan-to-value in the period 2003-2006 are virtually worthless, and only a complete recovery in housing prices before the borrowers sell short or default can save those loans from complete write-offs. In the meantime, now some 20% of all home owners have zero or negative equity; that's more than 20 million home owners. In addition many don't have enough equity or liquid funds to sell without a loss or refinance on beneficial terms. Further, as many millions of unemployed and underemployed try to survive until the economy recovers, the credit card companies have slashed credit limits, thereby destroying credit scores, and then raised rates and raised minimum payment percentages as a result making it more likely that borrowers will default. This situation is going to backfire with many more personal bankruptcies and credit card losses than would otherwise be the case.

If the U.S. is to avoid a very long recession (depression?) causing many millions more bankruptcies and foreclosures by individuals and businesses, and many more failures of banks and credit card lenders, the federal government needs to do something much more effective soon to relieve the excess mortgage debt from property collateral and transform the burden of excess consumer credit card debt to a more tenable form. The debt bomb has detonated wreaking havoc on the economy, and only the federal government has the resources and power to fix it quickly.

One unique proposed program to fix the credit crisis while simultaneously decreasing the federal deficit is The AllStreets Bailout Plan fully detailed at www.themortgagenews.info. It would provide access to low-interest long-term federal loans without any qualification, fairly allocated among all adult citizens and their lenders. It would transform excess mortgage debt to federal debt secured by the tax system instead of by the properties in order to free up home equity and radically reduce foreclosures and enable owners to sell or refinance. It would have the owners and lenders share equally the total of federal loans replacing some lost equity. It would provide fair access to the federal loans by those who do not have a mortgage or own a property, and those loans could be used to replace non-mortgage debt or be used as second mortgage funds to purchase a residential property. The program would automatically liquefy lender balance sheets to free up the credit system. The AllStreets Bailout would work and is probably the least cost solution for the government as well as individuals and businesses.

By: lvtfan

lvtfan — Thu, 02 Jul 2009 21:14:02 +0000

For more detail on the concentration of the ownership of stocks, etc., from the 2007 Survey of Consumer Finances, see http://lvtfan.typepad.com/lvtfans_blog/2009/06/...

Yes, 18% owned stocks directly, and 53% owned 401(k) or IRA retirement accounts. The more interesting figure, though, is how concentrated the holdings are. For Stocks, Mutual Funds and Retirement Assets combined (which represented 27% of aggregate household net worth), the top 10% of us held 74.2% of the value; the top 5% held 61.1% of the value. The holdings of the rest of the holders are pretty trivial.

Re: the holdings of various politicians -- it would be useful to know the dates of those valuations. If those are valuations as of 1/1/08, that would mean a lot fewer shares than would be at stake if those were valuations as of 1/1/09.