BushCo's bailout swindle is being challenged by Schumer and Clinton

[whistle]

...going into the weekend. The children in the White House, the U.S. Tresury and the Federal Reserve are acting stupid agian while their speculator cronies are raking up hundreds of billions in bailout funds all at tax payers expense. At least two adults Senator Schumer and Senator Hillary Clinton are coming in as responsible adults with workable programs

<snip>
Paulson, Bernanke Weighing New Plan, Schumer Says (Update1)

By Alison Vekshin

Sept. 18 (Bloomberg) -- Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke are considering a new plan to address the credit crisis, said Senator Charles Schumer, who proposed an agency to pump capital into troubled banks.

``The Federal Reserve and the Treasury are realizing that we need a more comprehensive solution,'' Schumer, a Democrat who chairs the congressional Joint Economic Committee, told reporters in Washington today. ``I've been talking to them about it.''

Schumer urged forming an agency to inject funds into financial companies in exchange for equity stakes and pledges to rewrite mortgages and make them more affordable. His remarks indicate momentum is building for some wider plan after the Fed and Treasury's takeovers of Fannie Mae, Freddie Mac and American International Group Inc. this month.

Schumer advocated a Great Depression-era Reconstruction Finance Corp. model, different from the Resolution Trust Corp.- type plan others have floated. Another RTC, which was a 1990s agency that sold devalued assets in the Savings and Loan Crisis, would ``simply transfer excessive risk to the U.S. government without addressing the plight of homeowners,'' he said.

Treasury spokeswoman Michele Davis didn't immediately respond to a request for comment and Fed spokeswoman Michelle Smith declined to comment.

Fed's Roles

Discussions with the Treasury and Fed focus on ``trying to do something more permanent'' after the series of government interventions, the New York senator said. For the Fed, ``it's hard for them to do monetary policy, which is their primary task, and then run all these businesses,'' he said.

Fed officials announced an $85 billion takeover of AIG two days ago, hours after leaving their benchmark interest rate unchanged in a decision that rebuffed some investors' calls for a cut.

``There is some preliminary discussions about how to sort of encapsulate and separate the two -- both to keep focus on monetary policy by the main Fed leaders, but also to prevent any conflicts of interest,'' Schumer said.

Lawmakers are weighing responses to a crisis that prompted Treasury Secretary Henry Paulson to seize Fannie and Freddie and caused the bankruptcy of Lehman Brothers Holdings Inc. in the past two weeks. The Fed's takeover of AIG followed its March agreement to take on $29 billion of Bear Stearns Cos. assets to secure the company's takeover by JPMorgan Chase & Co.

`Systemic Disaster'

``The series of ad-hoc interventions in the market over the past 10 days were important to avoid a systemic disaster,'' Schumer said. ``But we cannot continue to act in such an uncoordinated and ad-hoc fashion.''

Under Schumer's RFC plan, ``the government would come first,'' he said. ``The government would get repaid before the others in the financial chain.''

House Financial Services Committee Chairman Barney Frank, a Massachusetts Democrat, this week proposed Congress create a federal entity to buy bad loans. Senator Hillary Clinton of New York, a former candidate for the Democratic nomination for president, proposed resurrecting a 1930s-era agency to stem foreclosures.

``We need a modern day Home Owners' Loan Corporation,'' Clinton said in remarks at the Senate today. ``There will not be any semblance of a normal or orderly market'' without ``quarantining'' the devalued loans outstanding, she said.

The HOLC bought up outstanding mortgage and issued new, more affordable loans that helped people stay in their homes, Clinton said.

To contact the reporter on this story: Alison Vekshin in Washington at [e-mail]

http://www.bloomberg.com/apps/news?pid=20601087&sid=afIu492CyWMw&refer=home

[radonc]

1. OMG

http://www.nytimes.com/2008/09/20/washington/19cnd-cong.html?_r=1&hp=&pagewanted=print&oref=slogin

am I the only one who is scared SH*TLESS!!! I am too young to know about a great depression. Nothing sounds wiser than buying bad debt! Then the government will own all of those foreclosed homes that no one can afford cuz no one has jobs. Unbelievable! YEAH for the free markets!!!!

[whistle]

2. Please interpret what you just wrote and posted, you lost me after the scared shitless part

[aquart]

6. Too young to make rational sense?

Too young to notice that the government is currently shelling out for ALL the bad loans and getting nothing for any homeowning citizens whatsoever?

But if we renegotiate the loans so that the homeowners CAN ACTUALLY PAY THEM, then there are NO foreclosures which devalue entire neighborhoods.

Now go get your favorite Dr. Seuss and read three whole pages before bedtime.

[RC]

3. What needs to be done with these "Failed" business is to strip the

wealth of the Board of Directors and the CEO and use that money to prop the these business up till a plan of action can be finalized.
If the board and CEO ask what they are supposed live on, hand then food stamp and welfare sign-up forms. If it is good enough for us, it is good enough for them.

Oh, and direct them to the unemployment office.

[DearAbby]

4. Amen....amen

If the board and CEO ask what they are supposed live on, hand then food stamp and welfare sign-up forms. If it is good enough for us, it is good enough for them.

Oh, and direct them to the unemployment office. Yes, and a good dose of "Get a job, haul your ass up by your bootstraps" added in there. Hell yeah.

[MannyGoldstein]

5. If Schumer Is Involved...

it will result in money getting pried out of the Middle Class and handed to hedge fund managers.

That's what he does.