So who is getting the money from the bailout?

[The Straight Story]

The govt is putting hundreds of billions out there and who gets it - and when they get it, where are they sending it to?

Say we give a few hundred billion to bank X / insurance company X /etc - they get the check, then they take that money and give it to y/z - who is y/z ?

Basically I am wondering - where will all this money end up?

[kirby]

1. Basically they do not know...

I really believe Paulson and Bernake are panicked and again want to 'send a signal' to the market that they are on the job.

I dont think they have ANY CLUE on how they will even set a price for the assets.

One thing they are talking about is a Reverse Auction. Basically, any bank or investment bank would offer to sell their mortgage backed securities and the Treasury would buy it from the one selling it for the least amount. Paulson says they will get 'Experts' to help figure out the price, but I think these are the same Experts that ran these companies that are now failing.

I also think they believe the housing market will rebound. I think the housing market was and still is in a bubble. For this plan to work, a central tenet is that the housing prices resume going up. That is not a good basis for hoping these assets actually appreciate.

As far as who gets money, anyone willing to offer their mortgage backed stuff in a Reverse Auction.

[wiggs]

2. No different than any other huge expenditure. Whenever there's a huge pot

of money to be feasted upon you can bet that friends, associates, donors, and those owed a favor will be selected to benefit. These will be longtime associates of the administration and congress...people they grew up with...CEO's...fellow boardmembers sitting on boards of global corporations.

We're talking about a group of people, dems and republicans, who believe that America is strongest when corporate power is strong and power is concentrated and this power and influence can get things done overseas and can elect like minded people at home. This is a primary and guiding principle and you can see it implemented in every department and in every policy area over the last 8 years at least. This is a formula conceived decades ago and election of a dem congress in 06 hasn't changed it much.

This will turn out to be a major opportunity for a number of very wealthy people and corporations...probably the same ones who are upside down right now. Remember when, before and during the Iraq war, the govt was holding opportunity conferences on how to take economic advantage of the Iraq war? We'll see the same thing here.

There may be some benefit to taxpayers in general...but this is not entirely clear to me. If the money comes from the social security trust fund can we say there's benefit? If the dollar is devalued because we're printing more money and the dollars in my wallet no longer buys what it did yesterday is there benefit? If these mortages are purchased by middle east foreign money what are the impacts? If the govt can't afford to fix bridges, run headstart programs, or fund education fully then what are the benefits?

THIS WHOLE THING IS NOT CLEAR AT ALL AND THE CURRENT HEARINGS ARE NOT ANSWERING MANY QUESTIONS!! This should be a red flag and we should not rush this. Any congressman who votes YEA better be able to answer all the questions and not just parrot generalities offered by the administration.

[fed_up_mother]

3. Who's getting the money? Everyone but you and me!