Tag Archives: TARP fund

Bank of America -Citigroup-Seek more Bailout TARP Money

The Bank of America is getting more taxpayer dollars with another infusion of cash from the Treasury. This never ending rescue of banks in this second round indicates the first infusion did not succeed in lessening the impact of the first bank bailout.

The money is going around in circles with the buy our of Merrill Lynch & Company by the Bank of America Corp., it seems like the debt is being passed around to prevent further bankruptcy. It appears Bank of America did not have enough funds to cover the take over of Merrill and Citygroup is also expecting to report big losses.

As the recession deepens the banks are expecting a monsoon of more loans going bad in a worsening economy in itself which is dragging what were borderline loans into the red.
Both are expected to report huge losses on Friday’s report which will in itself send the markets tumbling.

The bailout for the Bank Of America is expected to be 120 billion dollars which is needed to pay off the bad paper from Merrill. It doesn’t seem like anyone is adding this all up especially when you consider that Citygroup received a 306 bailout two months ago.

No one is talking at the Treasury and that could only mean -you don’t want to know. With larger losses looming on the very near horizon taxpayers are becoming livid with anger of the bungling these banks have allowed by buying bad loans and selling them to other financial institutions. The insurance companies that insured these loans are not much better in complicity with this massive fraud on the American public.

This may indicate that the two largest banks in the US will be “owned” by the US government which should be the case after the huge innvestment of taxpayers dollars – it would only make sense to most people. Banks need to be regulated as they are the vital life blood of a country’s financial well being and failure will never be an option in the future. You certainly would not expect to give gamblers more money to gamble with when they lost the whole wad.
It shows the lack of financial sofistication that is lacking in the Federal regulators such as the SEC and various other organizations that monitor the financial system.

Government ownership of banks is very common in other countries such as Canada, England, and Ireland and with government regulations that hopefully they will follow it would be less likely for these banks to ever fail again.

So it seems that Bank of America’s CEO Kenneth Lewis did not estimate the buyouts of Merrill and Countrywide correctly and now needs a bailout himself. Lewis is now contemplating backing out of the Merrill merger.

Investors have no trust in th Bank of America which is bleeding red or Citygroup ability to come out of this recession alive and it is all on the taxpayers backs.

Republicans Favor Toyota-Scuttle Auto Loans

Ron Gettelfinger the President of the UAW, claims that the Republican senators that are blocking this bill are from states that gave major concessions to foreign car maker Toyota.

The Corker plan says the UAW must agree to drop wages of the autoworkers which reduces health care, retiree pensions, wages and other benefits. The Corker Plan made wages the primary goal of the auto loan and the concessions must be made by a certain date.

The Republican minority favor Toyota as it sits poised to take over of auto market if the big three all declare bankruptcy. Senator Richard Shelby the US Senator from Alabama has been the major stumbling block in his opposition to the auto loan. Shelby has Toyota money in his state of Alabama since 2001 and Toyota’s investment of 500 million dollars in a plant that employees over 891 employees.

Mr. Shelby is trying to break the UAW union and turning his back on the auto workers who are the American manufacturing base for the economy. In 1980 Shelby also voted against the Chrysler loan which was repaid back to the government and Chrysler survived for the following 28 years providing jobs to American autoworkers.

Toyota in his state received bonuses for the plant to be located in Alabama, free land, free labor to build the plant, major tax concessions, and much more. Mercedes has also located in Alabama which was also given major concessions to locate in the state of Alabama.

US Treasury has to step up to the plate and loan Main Street this vital loan. The Senate GOP caucus has defeated the bill which will collapse the economy and they are bent on defeating the loan package which includes concessions by the UAW.

The 112 billion given to AIG could be used to loan the automakers but that has not been an idea anyone has picked up on, since those funds are sitting in banks and not being loaned out. The Financial services sector receives their bailout without question Bob Corker, another Republican from Tennessee opposes the loan and it is strange that the Republican minority are blocking US jobs in favor of foreign automakers.

A retired engineer from General Motors has launched a new website to boycott Alabama at: http://www.boycottalabamanow.com/

Millions of jobs in every state are at risk if the emergency loans are scuttled. The Whitehouse is expected to act thorough the Treasury to assist at this last minute emergency created by the Republican minority. Previous warnings from the Bush administration to Republican senators has failed to pass the bill last night. It is up to the Whitehouse to proceed with a Tarp fund loan to prevent the collapse of the auto industry.

The failure of this administration to act would severely weaken an already destabilized economy.

TAGS: Richard Shelby, General Motors, UAW, boycott Alabama, Toyota, GM, Senate, Senator Shelby, Chrysler, Bob Corker, Ron Gettelfinger, Mercedes Benz.