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Nov 20, 2008


KSBR disgusted

oh, Axel, don't assume that the intent was bad just because the execution is dodgy and gamey. remember: competence is not the Bush administration's middle name, no matter how many Goldman Sachs brains you throw at the problem.


There appears to be no mention that any possibility exists that the bail-out is a deliberate and intentional, corrupt and dishonest activity and in plain view of ALL.

Ken Huffman

POGO needs to calm down about the special authorities for this Special IG. For crying out loud, unlike many IG's, this nominee is already special in appearing to have genuine qualifications for the job. Unfortunately, under structure of the IG Act, there's little more special to expect from the TARP OIG than from the rest. Until the existing IG concept, organizational design, and statutory language is fully overhauled, IG's will not have a substantive, transformative, or honest impact on waste, fraud, abuse, and mismanagement in govt. operations.

Lisa P

I think so, how did he make this plan? Did he consider its pros and cons to our nation? I hope he did. Well, this TARP or Troubled Asset Relief Program by Treasury Secretary Paulson wasn’t enough to cover the mortgage crisis up and this wasn’t the kind of credit repair scores the endangered homeowners needed. Now that Federal Deposit Insurance Corp Chairman Sheila Bair has pushed a new mortgage modification program forward, 1.5 million homeowners will have someone new on their side when they’re facing foreclosure. This $24.4 billion program will be drawn from the $700 billion pool that TARP set up, and it’s a very straightforward system. Lenders will be given a stipend of $1,000 per loan they renegotiate with financially stuck homeowners, and in the event of default on a loan, the FDIC has promised to take on up to 50 percent of the loss. Paulson has condemned this as mere spending that will only bankrupt the FDIC, others view this action on Bair’s part as a needed investment to maintain liquidity in the mortgage industry. While this won’t solve all of the problems at once, it’s certainly a valiant effort to help repair credit, isn’t it? Click to read more on Credit Repair.

KSBR furtively

We can hear the sound of one hand clapping at Pennsylvania and 15th Street, NW.

Having tried to pierce the black box myself, and via glancing contacts with some of the contending "financial agents" (Bk of NY Mellon, signed up as custodian of investments, and those firms seeking to be asset managers) it is clear that it is a very small group in Treasury that is making the decisions, subject to H. Paulson's veto. Kashkari plainly skirted Congressional demands for the criteria you seek, and he's not about to tell us. He's been really tough on disclosure (confidentially) of orgl COI, and, in pressing for really low prices for service--on the order of half the rates charged the Street. Treasury is using the three bank regulators as a first screen and line of defense, and those agencies are where applications of depositary institutions must go first; Treasury will ignore them if submitted directly, and may have shunted hundreds of apps away from its building. Now when Midas Muffler and GM and Tougaloo Bus Co. and JT Plumber Intergalactic, Inc., want a little TARP, they have to go to Treasury. Knowing Goldman Sachs training and culture, one can be sure that there is a "model" and written criteria to sift and evaluate everything--before some expert judgment needs to be applied. The notional glimmers one can pick up suggests they are going about this seriously, on two work shifts, and are snowed under with applications, many of them far fetched. Congress or the media will eventually crack the methodology, and you won't be disappointed with the craftsmanship. And maybe thinking people will understand that Treasury, wielding the TARP-granting power, will have to turn down a lot of companies; otherwise, why bother? Some companies are already failed or will fail--someone has to play the grim reaper by withholding TARP when it would just be throwing good taxpayer money after the investor have taken fatal hits. Whether all of this is authorized or comports with Congressional intent, not to mention politics, is another matter. It's clear that even with the 400-page version of the legislation, many members of Congress think the act (and I betcha only 1 in 10 have read it) is a stimulus program and have no idea that some companies have to be allowed to fail. In any case, questioning how Treasury makes such decisions is a fully legitimate question.

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