Oklahoma CEOs, leaders issue economic crisis statement
OKCBusiness
10/1/2008


The leaders of 16 Oklahoma-based employers issued a statement today imploring Congress to “take immediate steps to enact legislation to address the worsening economic crisis in America.”


Issued jointly, the statement congratulates Democratic Rep. Dan Boren and Republican Rep. Tom Cole for voting in favor of the $700 billion economic recovery bill and asks other Oklahoma legislators in the House of Representatives to reconsider.


“We are extremely disappointed in Congress’ inability to take the immediate and comprehensive action needed to address a financial crisis of historic magnitude. We are in the midst of a dangerous economic downturn that we fear could become substantially worse if Congress fails to act," the statement read. “We only have to look back at our own history to understand what happens when a lack of trust and stability shakes our financial system. In the face of this danger, continued inaction by our Federal Government is not an option in our view.”


Those issuing the statement included:

• Clay Bennett, Chairman of the Oklahoma City (NBA) Thunder

• David Boren, President of the University of Oklahoma

• Bill Cameron, CEO of American Fidelity Assurance Company

• Pete Delaney, Chairman, President and CEO of OGE Energy Corp.

• John Gibson, CEO of ONEOK and Chairman and CEO of ONEOK Partners

• Burns Hargis, President of Oklahoma State University

• Harold Hamm, Chairman and CEO of Continental Resources, Inc.

• Cliff Hudson, Chairman and CEO of Sonic Corp.

• George Kaiser, Chairman of BOK Financial Corporation

• Robert E. Lorton III, Publisher, Tulsa World

• Aubrey McClendon, Chairman and CEO of Chesapeake Energy Corporation

• Larry Nichols, Chairman and CEO of Devon Energy Corporation

• Gene Rainbolt, Chairman of BancFirst Corporation

• George Records Sr., Chairman of Midland Financial Co.

• Stacy Schusterman, Chairman and CEO of Samson

• Tom Ward, Chairman and CEO of SandRidge Energy

http://www.okcbusiness.com/images/photos/NBA-Bennett-Stern-Cornett-(.jpgClay Bennett (left), Chairman of the Oklahoma City Thunder, topped the list of 16 state CEOs and leaders issuing an economic crisis statement today. Photo/Mark Hancock

We're all ridiculous billionaires... please, help!

Inhofe voted against it, and several of those people are supporting his campaign.

Luke, only 2 of those are billionaires (Ward, McClendon). The rest are thousandaires or millionaires (still not hurting for money like us every day joes though). That still says something when they are willing to put the entire economy first because they know the implications of things (massive layoffs, devaluation of the dollar, etc.) if nothing is done about the current situation. Many of these companies use credit to pay payroll and then pay the short term loans back. Several of them support Inhofe because he supports big oil industry, see the connection? They still have lobbyists and contribute to his campaign, but they know a bad decision when they see one.

I think it's safe to say that the above list is millionaires or more. None are in the middle class tax bracket. They are not the average American, yet they're asking average Americans like you and me to shoulder a 700 billion dollar bill for them. That's what it is. And that is absolutely ridiculous.

something like $200,000 for every person over 18

Lets keep in mind that I'm a naive teenager that knows nothing about politics or economical things alike.

But heres how me, fellow class mates and our economics professor see it. We can vote for this, which I think we should, or we can let FannieMay and Freddie Mac fail and watch our country go into a recession on the scales of the Great Depression. Am I right? If those two companies fail, America's last leg is chewed to the bone? I really support this bill and I don't know why the public opposed it, but here is what I think.

We have a piss poor president. Hes not a good leader, hes not a good speaker. He doesn't take charge. He should have been up on a podium talking to the citizens of the U.S.A. and explaining exactly what this drastic bill will do. Because of course the general public is going to vote down a 700 million dollar tax that they are misinformed about. I really don't think most people realize how bad this could get, and they need to know about these issues. Sadly enough, we don't have the leadership in this country to do just that. We have to inform ourselves and our peers.

Hopefully other states do similar pleads to the goverment. But we all know its going to pass. Sure the public voted it down 7 to 1. But do you really think the government is going to let it go in our hands? No. The government will always make the hardest decisions for us and I'm glad about it on this one because if it were up to the public, then we're dead.

something like $200,000 for every person over 18

It is about $3500 per person. Not even close to the $200,000 you mentioned. Since we have a progressive income tax the amount the average person pays will be around $500 while the people on the list above will be in the $10s of thousands.

Not to single out okcusty here but the US annual budget is around $3 trillion. If you think a $700 billion package will cost $200,000 per person just how much do you think a $3 trillion annual budget cost per person?

It is an across the board fundamental lack of economic education that has lead to this problem. CEO (especially the Ivy League ones) are incapable of running companies, CFOs seem to know very very very little about business finance, bankers don't understand how to lend money, and the average person appears to not even know how much money they can spend on a house. I say let the whole system collapse. It is what Darwin would do.

Luke, only 2 of those are billionaires (Ward, McClendon). The rest are thousandaires or millionaires (still not hurting for money like us every day joes though). That still says something when they are willing to put the entire economy first because they know the implications of things (massive layoffs, devaluation of the dollar, etc.) if nothing is done about the current situation. Many of these companies use credit to pay payroll and then pay the short term loans back. Several of them support Inhofe because he supports big oil industry, see the connection? They still have lobbyists and contribute to his campaign, but they know a bad decision when they see one.

You forgot about Kaiser, Schusterman, and Hamm, all multi-billionaires.

It is about $3500 per person.

The more pork that gets packed in, the more that would go up...

Lou Dobbs on CNN has said that this is looking like a 1.5 trillion dollar mess after it's all said and done. If that was the case we're looking at over $7000 per person.

If some dissenting Representative wanted to throw a wrench into this whole bailout, they would stand up and say, "hey, let's cut $7000 checks to every American!" Talk about a boost to our economy. Households would get an extra $15k-$20k or more. I think even THAT'S better than failed Wall Street businessmen to get it. However, I think both are the wrong way to do it.

Luke, only 2 of those are billionaires (Ward, McClendon). The rest are thousandaires or millionaires (still not hurting for money like us every day joes though).

Splitting hairs here, but Hamm is a multi-billionaire... 4 to 7 billion I believe.

Don't get my wrong Luke - I am against the bailout, period. A bailout would do two things. First, it would reward people for bad business practices and second it would punish lenders, brokerage houses, and others that played by the rules in the first place. Any idea what happens when you start rewarding the cheaters and penalizing the people that play by the rules - everyone will start cheating and we will be right back in this mess in 10 years.

P.S. - don't buy into the crisis mongering being put out by those who want the free money - or at least access to free money. If Sonics goes out of business because they can't get access to cheap loans then they have a failed business model to begin with. My guess is that Sonic in no way is even close to going out of business despite the pleas of its CEO in the letter mentioned above.

What billionaires say makes headlines; what thousandaires say doesn't.

Sonic's problem has more to do with tight credit than their own business model. See AP story in today's JR: The Journal Record - Article (http://www.journalrecord.com/article.cfm?recid=92638)

Want a real-time, real-world example of tight credit trickling down? Look at September auto sales figures released two days ago. The domestic manufacturers' financing divisions (Ford Motor Credit, GMAC and Chrysler Financial) experienced "constrained capital" which led to their having to raise lending standards on their auto loans. Combine that with a pullback from auto leases (unaffordable due to low resale values on SUVs & trucks coming back at the end of leases), and car sales fell off a cliff.

It isn't a bailout and it isn't unprecedented. Look up HOLC in Wikipedia. FDR did the same thing 75 years ago.

I love the fact that you pointed out the problems with the auto industry as an example of why to support the bailout. The auto industry spent 3 years stealing from future sales so executive management could reap larger bonuses. 0% interst loans for everyone, cheap lease rates, 72 month financing, and on and on allowed people to buy cars 2 to 4 years sooner than they would have under normal lending standards. Couple this with banks that were allowing people with negative equity to role the debt into the new loan even made it worse. Bailing these people out won't help them.

These people are like crack addicts - if you want to help them you have to cut off their supply of crack. If hearing the crack addict cry in the middle of the night is hard on the parents (tax payers) then so be it. The solution should not be to let the addict get their fix. This country is in serious need of some economic tough love.

I read the article and it actully proves my side of the point. Lenders are now making sure the person they loan the money to can pay them back. What a crazy idea.

The four paragraphs in my single post defined four different topics that are facets of a single subject which is the current global financial crisis.

And what's with beating the drum on executive compensation excesses, and using crack addict metaphors? You can go deeper than regurgitating cliches.

If you don't support the $700 billion package, that's fine, but you've got to offer an alternative solution.

If you don't support the $700 billion package, that's fine, but you've got to offer an alternative solution.

Alternative Solution: Bankruptcy. Let the businesses that played by the rules win.

Here, this guy can explain it better than me.
Commentary: Bankruptcy, not bailout, is the right answer - CNN.com (http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html?iref=mpstoryview)

Look at September auto sales figures released two days ago. The domestic manufacturers' financing divisions (Ford Motor Credit, GMAC and Chrysler Financial) experienced "constrained capital" which led to their having to raise lending standards on their auto loans.

Hmpf....Tell me about it...

What billionaires say makes headlines; what thousandaires say doesn't.

Sonic's problem has more to do with tight credit than their own business model. See AP story in today's JR: The Journal Record - Article (http://www.journalrecord.com/article.cfm?recid=92638)

Want a real-time, real-world example of tight credit trickling down? Look at September auto sales figures released two days ago. The domestic manufacturers' financing divisions (Ford Motor Credit, GMAC and Chrysler Financial) experienced "constrained capital" which led to their having to raise lending standards on their auto loans. Combine that with a pullback from auto leases (unaffordable due to low resale values on SUVs & trucks coming back at the end of leases), and car sales fell off a cliff.

It isn't a bailout and it isn't unprecedented. Look up HOLC in Wikipedia. FDR did the same thing 75 years ago.

I'm a thousandaire and I've made local headlines half a dozen times in the last 1.5 months. Could it be billionaires became billionaires for a reason? They know how this will not only affect their businesses, but the hundreds and thousands of employees they employ and would potentially have to lay off. That is what this boils down to. As you say, if your against the bailouts, fine, but there has to be an alternative solution other than "let the markets fix themselves". The free markets have already failed! What a sad time in American history.

Kerry:

You're on. And rather than simply resorting to dueling hyperlinks, here are my own original thoughts, beginning with my disagreements with Mr. Miron's suggestion ("Let 'em fail").

Mr. Miron's overarching point is flawed, because he confuses reorganization with liquidation. He seeks to keep the companies running while arbitrarily (and punitively, I'd suggest) wiping out the shareholders, preserving the creditors, and replacing managers. You can't have a hybrid. A reorganization preserves shareholders, creditors take a big hit, and future management either stays or is replaced. In a liquidation, shareholders take the big hit, creditors get the value of the pieces, and management is out because there's nothing left to run. He picks and chooses what happens to each without regard to the law.

Mr. Miron proposes a scenario similar to what happened with FNM & FRE, where the shareholders were clobbered (I was one of thousands who was neither a speculator nor insider), the creditors were preserved, and new management was brought in (but no-one yet knows who or from where). If that's how the future world will be run, then no-one will take the risks of owning stock in ANY company because they run the risk of an immediate and total loss. Case in point: That fear two weeks ago is what led investors to withdraw billions from the stock market and money market accounts, and accelerated additional corporate failures and dropped the yield on U.S. Treasuries to 0.0%. What kind of solution is that?

Ultimately we'll all pay for this, whether you consider yourself a "taxpayer" or an "investor," because all but the very poor are invested in the markets through individual stocks, retirement plans, 529 plans, ESOPs and the like. As Obama said earlier this week (I'm characterizing, not quoting), "When your neighbor's house is on fire because he was smoking in bed, you don't let it keep burning in order to punish him. You put it out because if you don't , there's a good chance that it will eventually catch your own house on fire."

(Darn - I promised not to quote anyone else, didn't I?)

Want a real-time, real-world example of tight credit trickling down? Look at September auto sales figures released two days ago. The domestic manufacturers' financing divisions (Ford Motor Credit, GMAC and Chrysler Financial) experienced "constrained capital" which led to their having to raise lending standards on their auto loans. Combine that with a pullback from auto leases (unaffordable due to low resale values on SUVs & trucks coming back at the end of leases), and car sales fell off a cliff.

So you want to bail them out AND let them continue to make loans to people with bad credit. They should have never relaxed their loan standards in the first place. It looks to me like the free-market solutions are already kicking in (increasing lending requirements). Why can't we give the free market time to work?

I proposed neither "bailing out" anybody or making loans to people with bad credit. What I was responding to the flawed link you tossed out in response to my suggestion that you come up with a solution other than "not that" to the $700 billion package that was just passed by the House and signed by the President. (Did you look up HOLC, by the way?)

We can go round and round on woulda coulda shoulda, and call for frontier justice on executives and people who took on too much debt, but that won't get us anywhere.

It's your turn to contribute if you want to keep the dialogue going.

This "bailout" was another case of the governemnt throwing money at a problem to try to make it go away. If the government was going to throw money at a problem, they needed to come up with a lot better way to do it. A better way would have been, instead of buying billions of dollars in distressed debt, to provide equity capital to the banks in exchange for preferred stock, similar to how the S&L crisis was handled. Of course this deal would not have included quite the "sweeteners" as some people like to call them, which is the reason why this was never an option

Of course this deal would not have included quite the "sweeteners" as some people like to call them, which is the reason why this was never an option

And Obama and McCain who "hate pork and would veto it and will crack down when they're in charge and blah, blah, blah..." VOTED FOR IT!!!

Hypocrites!

So Congress passes the bailout, Bush signs it, and the Dow promptly goes down 150 points. Yep - looks like it working just great so far. When will we know if this solves the problem or not? If this works are you guys going to give Bush the credit for formulating the plan, getting it passed in a reluctant Congress, and signing it into law?

ugh, this all makes me crazy!

Here's what will happen, the bailout will assist those who made huge profits through subprime mortgages. People took out crappy loans and went whacko refinancing like crazy.. mortgage brokers made out with excessive points and loan charges, CEO's made out with severance and bonuses, and here we are paying to bail them out and they are all keeping their money!

Okay, so now they are still set.. and what will happen now? The same damn thing that just happened.

Homeowners on the coasts and 'hot' markets will see equity appreciation over time, and once again, use their home equity like an ATM, take out their 'cash' buy a few more luxury SUVs ( because it's a tax write off of course!) banks and brokers will go crazy and oops.. here we go again, homeowners will then moan and groan when the value of their home goes down ( vicious cycle) and they can't make the payments, forclosures loom and we'll have to approve another bailout!

All the while, all of us ' slow and steady, work our butts off, save, penny pinch and pay cash folks,' will have our home values remain stable, not spend foolishly, yet we still pay again and again for these crappy subprime loan mistakes and executive perks through repeated Bailouts.. yeah, the terminology will have changed, but it will be the same.. the precedent has been set. Your children and My children and grandchildren and great grandchildren will pay for this.

Like I said, ugh.

How about a bailout for every taxpayer? We can tax wall street for the money.

Or at least allow every voter punch every Wall Street CEO, Board Member, Manager and Politician who created this mess strait in the chops.

I have feeling this bailout is going to cost a lot politicians thier jobs.

The American people are angry beyond any means I have seen before, how much more of this are people going to take before civil unrest occurs.

Anyone remember this story from December 2006.
http://www.usatoday.com/money/industries/brokerage/2006-12-20-wall-st-bonuses_x.htm

Anyone remember this story from December 2006.
http://www.usatoday.com/money/industries/brokerage/2006-12-20-wall-st-bonuses_x.htm

Well, I'm glad our tax dollars are going to good use.

:rolleyes:

Anyone remember this story from December 2006.
http://www.usatoday.com/money/industries/brokerage/2006-12-20-wall-st-bonuses_x.htm

That's pretty sickening.

More and more stories are coming out about the pay CEOs were taking while their companies were going down.

Glad to know our tax dollars will help these folks, who obviously know how to run a business, get up and running again.

:rolleyes:

Can somebody connect the dots for me? Show me where one dollar of the $700 billion went into an executive's pocket. And if you think that future dollars will line their pockets, take heart in this quote from Rep. John Mica (R-FL) yesterday at the hearing of Richard Fuld, CEO of Lehman: "If you haven't discovered your role, you're the villain." Fuld and his buddies are not far behind Ken Lay (RIP), Andy Fastow, Jeff Skilling, John Rigas or Dennis Kozlowski.

Can somebody connect the dots for me? Show me where one dollar of the $700 billion went into an executive's pocket. And if you think that future dollars will line their pockets, take heart in this quote from Rep. John Mica (R-FL) yesterday at the hearing of Richard Fuld, CEO of Lehman: "If you haven't discovered your role, you're the villain." Fuld and his buddies are not far behind Ken Lay (RIP), Andy Fastow, Jeff Skilling, John Rigas or Dennis Kozlowski.

First off, of course some of the bailout tax dollars will go towards executive pay.

Secondly, my point is that regardless of whether or not the executives get our tax dollars, THEY ARE THE ONES WHO ARE GOING TO BE IN CHARGE OF THEM. Seems kind of silly to allow the ones who couldn't do it right to be given 700 billion more.

Thirdly, as much as the the government wants to paint them as the "villians", to turn around and give them 700 billion dollars is not just non-sensical, it's insane.

Such a typical government response, throw money at it.

I haven't seen the details, but my understanding is that most of the $700 billion was to buy mortgages using a Dutch auction process. If you're one of the liquidity-starved lenders, this will convert an illiquid mortgage into cash, improving your balance sheet by raising your capital. Goes for both performing mortgages and the so-called toxic variety.

Append: If - as a lender - you've got a huge number of toxic mortgages, then you'll get few pennies on the dollar at auction, and if you weren't dissolved in September's wave of financial collapses, you'll be in the second wave. This thing is far from over.

well lets see, in 2006 the executives at the failed companies pulled $20 billion out of these compaines. Your right though, most of the $700 billion will not go to pay executives but $20 billion will go to cover the pay already provided. BTW - I think it is clear now that most investors around world were not happy about the bailout. And here is where another $13 million is going.
WaMu CEO could get $13.65 million for 18 days work | Reuters (http://www.reuters.com/article/ousiv/idUSTRE48P8LG20080926)

I don't care how much people make as long as they don't ask for handout when it all goes South.

How about a bailout for every taxpayer? We can tax wall street for the money.

Or at least allow every voter punch every Wall Street CEO, Board Member, Manager and Politician who created this mess strait in the chops.

I have feeling this bailout is going to cost a lot politicians thier jobs.

The American people are angry beyond any means I have seen before, how much more of this are people going to take before civil unrest occurs.

Interesting. Nothing will get your point across like a good ass kicking.
Knock Out: CNBC Confirms Lehman CEO Punched at Gym (http://www.businessandmedia.org/printer/2008/20081006150152.aspx)

Aig Goes On Vacation: After The Bailout AIG Bought Themselves A $440,000 "Retreat" At A California Resort (http://consumerist.com/5060290/after-the-bailout-aig-bought-themselves-a-440000-retreat-at-a-california-resort)

My family could have lived for several years on the amount of tax dollars that went to weeklong AIG exec vacation... AFTER the bailout was passed...


Now that AIG has been nationalized, some folks are wondering just how their tax dollars are being spent. If you're among them, we have some bad news for you from ABC. They are reporting that papers uncovered by congressional investigators show that "less than a week after the federal government committed $85 billion to bail out AIG, executives of the giant AIG insurance company headed for a week-long retreat at a luxury resort and spa, the St. Regis Resort in Monarch Beach, California." Ouch.

ABC says that the documents show that the company, yes the company, paid more than $400,000 for a week long retreat at the resort. The bill included $200,000 for rooms, $150,000 for meals and $23,000 in spa charges.

Dow's down another 500 today, too.

Thanks, bailout!

Aig Goes On Vacation: After The Bailout AIG Bought Themselves A $440,000 "Retreat" At A California Resort (http://consumerist.com/5060290/after-the-bailout-aig-bought-themselves-a-440000-retreat-at-a-california-resort)

My family could have lived for several years on the amount of tax dollars that went to weeklong AIG exec vacation... AFTER the bailout was passed...



Dow's down another 500 today, too.

Thanks, bailout!

Wouldn't have anything to do with Bank of America & Alcoa's earnings reported today, would it?

With fear and trembling, we were sold the idea of this bailout. The markets were getting lower, the pundits said we needed it, politicians grudgingly said we needed it and we needed it NOW! Even the headline of this thread is "...do something quick!"

The understanding was that this bailout would save the market and in turn "main street" would be saved.

Now, not only do we have the economic downturn, but we have an additional almost trillion dollars of taxpayer debt. Real nice.

Keep in mind the market stablized after Congress voted down the bailout. After the bailout passed all hell broke lose. We would have been better off letting the market determine the winners and losers and not some arbitrary government Dutch auction. The free market solution was already working. People who didn't qualify for loans were not getting them anymore. Now I hear politicians going on and on about freeing up the credit market. Do they even understand that is what got us here in the first place?

BTW - the national debt clock ran out of digits. Congress and Wall Street are screwing all of us.
National Debt Clock Runs Out of Digits | United Liberty | Free Market - Individual Liberty - Limited Government (http://www.unitedliberty.org/videos/national-debt-clock-runs-out-of-digits)

When you watch the video keep in mind that it is Congress that spends the money. The person being interviewed doesn't seem to know that.

Aig Goes On Vacation: After The Bailout AIG Bought Themselves A $440,000 "Retreat" At A California Resort (http://consumerist.com/5060290/after-the-bailout-aig-bought-themselves-a-440000-retreat-at-a-california-resort)

My family could have lived for several years on the amount of tax dollars that went to weeklong AIG exec vacation... AFTER the bailout was passed...

Dow's down another 500 today, too.

Thanks, bailout!

I don't know which is worse; AIG and their vacation or hearing a Congressman complain about it. No one can run up a vacation bill like members of Congress. I wonder how the Congressional retirement plan is fairing. I am down 30% this year. Anyone want to guess which is the first state to say, "Screw this crap, we are opting out." My money is on South Carolina.

I don't know which is worse; AIG and their vacation or hearing a Congressman complain about it.

They vote it in, then complain about it. Asinine.

On a related note, Mary Fallin will NOT be getting my vote for re-election.

Anyone want to guess which is the first state to say, "Screw this crap, we are opting out." My money is on South Carolina.

Or Alaska.

If you think you were all ready pissed off - now we find this.

HUD: Five Million Fraudulent Mortgages Held by Illegals
KFYI - "The Valley's Talk Station" (http://kfyi.com/pages/local_news.html?feed=118695&article=4364653)

I predict the market will turn around in the next 12 days. With 500 point loses everyday we will be at zero in about 2 weeks. I guess you could credit the bailout for taking us to zero, and thus turning the market around.

I just wonder how long it will be before you see millions of people marching on Washington.

I also wonder how the US Government would respond if one or more particular states fought for secession from the union.

Would the people in office send military troops to re-take those states or would they permit it to happen provided a majority of voters approved?

Honestly, I think Oklahoma and Texas could ban together and support each other as an independent country we would have great football, good steaks, hot women, plenty of oil and lots of beautiful scenery.

It is time to do something in my opinion the government has grown way beyond its means. Too many states lean on the United States governemnt to cover thier failures at maintaining thier books. Too many people are co-dependent on the federal government.

Not to mention Oklahoma is a donor state when it comes to paying federal taxes we never get a fair share of the money we pay in to the system.

Oneforone - I think we are on the same page here. I just don't see how our federal government can continue. We are so over-spent at the federal level it is beyond belief. Throw in the additional $1 trillion spent by the feds in the last week alone and the picture only gets worse. Plus, the feds get 60% of the tax dollars from the top 5% of wage earners, but guess who won't be showing any income this year. You guessed it, the top 5%. There won't be anything to tax so expect the feds to run a huge deficit next year.

I thought the US would cease to exist in 2020 but it might be sooner. Get ready for Americas 3rd federal government.

I think it is now safe to say the bailout has been a failure. Every economic problem the bailout was supposed to fix has come anyhow.

Jobless rate bolts to 14-year high of 6.5 percent: Financial News - Yahoo! Finance (http://biz.yahoo.com/ap/081107/economy.html?.v=6)
Bloomberg.com: Worldwide (http://www.bloomberg.com/apps/news?pid=20601087&sid=a9Oq499c._cA&refer=worldwide)
UAW chief urges $25 bln in U.S. auto health care support | Reuters (http://www.reuters.com/article/marketsnews/idINN0626458920081107?rpc=33)
'If I had a nickel for every bag,' sez Mayor Bloomberg (http://www.nydailynews.com/ny_local/2008/11/06/2008-11-06_if_i_had_a_nickel_for_every_bag_sez_mayo.html)
wcbstv.com - Tax Hikes, Budget Cuts In The Works For NYC (http://wcbstv.com/local/michael.bloomberg.income.2.856839.html)
http://www.breitbart.com/article.php?id=D949JG0O3&show_article=1

Failure? The funds haven't even finished going out. NPR reported this morning that an additional $155 billion just went to banks this week. From npr.org:

November 7, 2008 · The government's Troubled Asset Relief Program — known as TARP — was designed to thaw the frozen credit markets by, among other things, buying up financial firms' "toxic assets." The Treasury Department says it has given $155 billion to eight banks so far, which has helped them increase short-term lending. But the department hasn't yet started to buy up problematic mortgage-backed securities.

This isn't the Magic Kingdom where you wave a wand and the problem goes away.

I think it is now safe to say the bailout has been a failure. Every economic problem the bailout was supposed to fix has come anyhow.

Jobless rate bolts to 14-year high of 6.5 percent: Financial News - Yahoo! Finance (http://biz.yahoo.com/ap/081107/economy.html?.v=6)
Bloomberg.com: Worldwide (http://www.bloomberg.com/apps/news?pid=20601087&sid=a9Oq499c._cA&refer=worldwide)
UAW chief urges $25 bln in U.S. auto health care support | Reuters (http://www.reuters.com/article/marketsnews/idINN0626458920081107?rpc=33)
'If I had a nickel for every bag,' sez Mayor Bloomberg (http://www.nydailynews.com/ny_local/2008/11/06/2008-11-06_if_i_had_a_nickel_for_every_bag_sez_mayo.html)
wcbstv.com - Tax Hikes, Budget Cuts In The Works For NYC (http://wcbstv.com/local/michael.bloomberg.income.2.856839.html)
Schwarzenegger: $4.4B in tax hikes to end deficit (http://www.breitbart.com/article.php?id=D949JG0O3&show_article=1)


I thought you said it was going to turn around in 12 days...... J/K

OKCTalker - I realize it can't be fixed that fast (waiting for money from the government is slow slow process) but that wasn't how the bailout was sold to the American people. It was presented as the solution. All it has done is increase the number of companies asking for the hand outs. Now Ford, GM, and UAW want $25 billion of tax payers money (producers) to cover the healthcare costs of people that no longer contribute to the countries GDP, blue collar retirees. The scary part is the Dems are going to give it to them. Let the UAW increase union dues to cover the short fall.

Metro - I was right about the market recovering. In the week leading up to the election the market improved greatly as McCain narrowed the gap. In the 2 days since the election it has seen a historic decline. The simple answer is investors don't want to see the federal govenment involved.

Update - Ford, GM, and UAW just met with the Democrat Leadership. The Auto Industry is now asking for $50 billion. Obama promised $150 billion to them during the campaign. Get ready to be raked over the coals yet again.

Just imagine how fast this economy would recover if the $800 billion bailout came in the form of tax cuts. We need to stimulate consumption.

Kerry - You called it a failure after less than two months since the crisis began, and now recognize that it can't be fixed that fast. Now you're saying that it was misrepresented ("wasn't how the bailout was sold"). If there ever was a dynamic problem requiring an evolving solution, this is it.

As to Detoit and the domestic manufacturers, they had their hands out long before mid-September, and their $25b package was specifically (with strings attached, mind you) intended to help develop fuel-efficient cars. That they're back asking for another $25b is unrelated to the financial meltdown with one exception - tight credit. GMAC accounced either Wed or Thu this week that they are curtailing financing to all but the most credit-worthy car buyers. Since the majority of car buyers don't meet that definition, the cars pile up on the dealers' lots. CNBC went long on this last night, elaborating how domestic manufacturers only employ 0.6% of the total U.S. workforce (down from 2.0%+ not long ago), but letting them fail would impact millions more - the employees of companies that make the parts that go into the cars.

As to Detoit and the domestic manufacturers, they had their hands out long before mid-September, and their $25b package was specifically (with strings attached, mind you) intended to help develop fuel-efficient cars. That they're back asking for another $25b is unrelated to the financial meltdown with one exception - tight credit.

Actually, they got the already got the $25 billion for fuel efficient cars. They are now asking for an additional $50 billion - $25 billion for health care and $25 billion to spend how they wish. If the $800 billion bailout came in the form of a tax cut we would be out of this by now. People would have seen that in their pay check almost 2 months ago.

People would have done 2 things with the money: 1) Put it in the bank and thus increase the availabiity of money to loan which would free up the credit market, or 2) Buy the products of these companies that are asking for the money now. All the bailout is doing is taking the consumer out of the loop. Companies won't last long without the consumer.

Actually, they got the already got the $25 billion for fuel efficient cars. They are now asking for an additional $50 billion - $25 billion for health care and $25 billion to spend how they wish. If the $800 billion bailout came in the form of a tax cut we would be out of this by now. People would have seen that in their pay check almost 2 months ago.

People would have done 2 things with the money: 1) Put it in the bank and thus increase the availabiity of money to loan which would free up the credit market, or 2) Buy the products of these companies that are asking for the money now. All the bailout is doing is taking the consumer out of the loop. Companies won't last long without the consumer.Kerry I wont totally disagree with you regarding the 2 groups you mentioned. I believe there may be a third group as well. Some wont be able to save or spend, they would being paying down their credit debt for things previously consumed. Your thoughts.

Andy157 - yes that is a third group that I missed. However, paying off credit card debt would help the financial companies that issues credit cards. One of the problems is all of the people defaulting on credit card debt which reduces cash flow at financial institution. See, another problem solved.

Andy157 - yes that is a third group that I missed. However, paying off credit card debt would help the financial companies that issues credit cards. One of the problems is all of the people defaulting on credit card debt which reduces cash flow at financial institution. See, another problem solved.Damn were good

What the....

Now we find out about a secret $2 trillion bailout and the Fed won't say who the money went to!

Bloomberg.com: Worldwide (http://www.bloomberg.com/apps/news?pid=20601087&sid=aatlky_cH.tY&refer=worldwide)

Companies are lining up for the free money. The bailout has officially become a handout. Companies seem like they are no longer interested in attracting customers, only how to best position themselves for the tax payer cash.


“Given the continued volatility in the financial markets,” said Kenneth I. Chenault, chief executive of American Express, “we want to be best-positioned to take advantage of the various programs the federal government has introduced or may introduce to support U.S. financial institutions.”



American Express to Become Bank Holding Company - Mergers, Acquisitions, Venture Capital, Hedge Funds -- DealBook - New York Times (http://dealbook.blogs.nytimes.com/2008/11/10/american-express-to-become-bank-holding-company/)

and here is the GM CEO with one of the dumbest quotes yet.


GM is willing to offer the government preferred stock, speed the introduction of fuel-efficient vehicles and set limits on executive compensation in exchange for financial aid, Wagoner said.

But Wagoner did not think it would be "a very smart move" for him to resign.

"It's not clear to me what purpose would be served" Wagoner said. "I think our job is to make sure we have the best management team to run GM."

On Friday the biggest US automaker warned it would run out of cash in the first half of next year and appealed to the US government for help to save it from collapse.

The company announced a third-quarter loss of 2.5 billion dollars and said it had burned through another 6.9 billion of cash during the three-month period, leaving it with cash reserves of 16.2 billion.