Wednesday, April 8, 2009

Another Bad Idea

Here's what just came up as a headline on the NY Times website: U.S. Imagines the Bailout as an Investment Tool. The bailout as an investment tool? Here's the idea:
As part of its sweeping plan to purge banks of troublesome assets, the Obama administration is encouraging several large investment companies to create the financial-crisis equivalent of war bonds: bailout funds.

The idea is that these investments, akin to mutual funds that buy stocks and bonds, would give ordinary Americans a chance to profit from the bailouts that are being financed by their tax dollars. But there is another, deeply political motivation as well: to quiet accusations that all of these giant bailouts will benefit only Wall Street plutocrats.
Why did a huge shudder suddenly go up and down my spine? The only thing I can compare this one with is the Bush administration's idea to hire a public relations firm to sell the Iraqi people on how great everything will be if only they can learn to love Big Brother and his sidekick, Dick Cheney.

How out of touch can an administration be?

The article continues:
The embrace of smaller investors underscores the concern in Washington and on Wall Street that Americans’ anger could imperil further efforts to stimulate the economy with vast amounts of government spending. Many Americans say they believe the bailout programs — and the potentially rich profits they could yield — will benefit only a golden few, including some of the institutions that helped push the economy to the brink.

“This is an opportunity to forge an alliance between Main Street, Wall Street and K Street,” said Steven A. Baffico, an executive at BlackRock, referring to the Washington address of many lobbying firms. BlackRock, a giant money management firm, is playing a central role in the government’s efforts and is considering creating a bailout fund. “It’s giving the guy on Main Street an equal seat at the table next to the big guys,” he said.
So, just like all that sub-prime mortgage debt was sliced and diced and sold off to any and every sucker they could find, the US government is going to start slicing and dicing and selling off its bailout debt? To "Main Street"?????????? Hey, that's where I live, and I'll tell you right now: ain't nobody on my block who's gonna fall for that one.

Gee, I wonder if the Obama administration is going to hire the same P/R firm to sell this bright idea.

2 comments:

  1. This sounds like another idea conceived by Wall Street insiders. I'm sure they would love to dump their toxic waste on regular citizens.

    There is a massive disconnect between Washington, Wall Street, and the rest of us. Somehow I don't think screwing us over by selling us the crap that they don't want is going to reduce the anger level. But hey, what do I know?

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  2. You might not know much about economics. But you know enough to see through this really really terrible scheme. I'm no expert either -- but DUH????

    Even if the investments they're promoting are reasonably safe, which I doubt, it's still a really bad idea to try to encourage ordinary people to go back to gambling on the market all over again, after they've been scammed so badly. Most people will see through it and that will be yet one more boost for the Republicans. OY!!!! We need this like a hole in the head.

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