I don't know how much you guys have dug into this plan, but the bottom line is that it is yet another attempt by Geithner and the GS crew to bail out their buddies. Most of the economy blogs I follow already have a take on it and in a nutshell the program is designed to let banks and hedge funds speculate on these assets with all the risk shoved on the taxpayer.

Several of the blogs already pointed out ways this system could be gamed, and it seems like Citigroup and Bank of America are already taking steps to do something just like that

http://www.nypost.com/seven/03252009/business/double_dippers_161157.htm

What really blows my mind is the purpose of the stress test and the PPIP was for price discovery and try to move the markets along. Well if these guys are buying it at .30 on the dollar, the price discovery is done for similar tranches and CDOs. The FDIC should have all it needs to shut these bitches down. This is a fleecing of the taxpayer, simple as that.

3/25/2009 9:46:39 PM

fdic gets screwed from the new program

3/25/2009 9:59:00 PM

Quote :

"only hedge fund managers are truly happy about the stimulus plan"

3/25/2009 10:58:56 PM

Hedge Fund Guru George Soros is enjoying the recession....

Quote :

"George Soros, who predicted the global financial crisis twice before, was one of the few people to anticipate and prepare for the current economic collapse. 'It is, in a way, the culminating point of my life’s work,' he told national newspaper The Australian. Soros is one of 25, top hedge fund managers from across Wall Street who have defied the credit crunch crisis to reap a total of $11.6 billion last year."

Well good for George. Do you think Obama and his pals will go after super-lib Soros for making all that evil money off the pain and suffering of others?

http://www.dailymail.co.uk/news/worldnews/article-1164771/Im-having-good-crisis-says-hedge-fund-manager-1billion-world-plunged-recession.html

3/25/2009 11:10:38 PM

Did Obama kill your cat? Fuck your wife? Beat you at a game of hoops?

You've clearly become the worst partisan hack in this section, surpassing aaronburro on the sandy vagina scale by about 100%.

3/25/2009 11:16:36 PM

boulders up the vag

3/25/2009 11:20:18 PM

http://www.ritholtz.com/blog/2009/03/ppip-heads-or-tails/

3/29/2009 10:28:30 AM

Im so regoddamned tired of Bankers making money with the help of our government.

they dont need anymore help!!1

we have to play in their system everyday that basically has us normal folks by the balls.

For the people over in the "taxing the rich thread" wondering how its fair that the Uber rich have to pay more taxes for being more "productive". This has to be a pretty good example of how some people rationalize it. Our government and our economic system make it much easier for a hedge fund manager to keep getting richer than Joe Schmoe to pull himself up by his boot straps.

3/29/2009 11:06:48 AM

^ You are making assumptions based on who the "rich" are in aggregate. First, per the Treasury's income-mobility report, the majority of tax payers move in and out of income brackets, so it is not like there is a group who is perpetually in the top income bracket who we can single out and call "rich." Someone might fit this definition one year and not the next. Secondly, you are assuming that hedge-fund managers and investment bankers make up the majority of the top bracket. I have not come across any data that supports that. I would certainly think they make up a sizable percentage, but trying to single them out would have perverse affects on those who create tangible businesses (e.g. everyone from Larry Page, Sergey Brin and Bill Gates to a local Raleigh small-business owner who found a new way to make cement).

[Edited on March 29, 2009 at 12:57 PM. Reason : .]

3/29/2009 12:55:02 PM

the latest NPR Planet Money podcast has another good "back to the basics" conversation on what some of the problems are and how the PPIP can work, ~min 15:00
http://itunes.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?i=52443541&id=290783428

3/29/2009 2:04:52 PM

Quote :

"For the people over in the "taxing the rich thread" wondering how its fair that the Uber rich have to pay more taxes for being more "productive". This has to be a pretty good example of how some people rationalize it. Our government and our economic system make it much easier for a hedge fund manager to keep getting richer than Joe Schmoe to pull himself up by his boot straps."

To be fair, as near as I can tell, no one in the "rich" threat who dislikes the increased taxation on the rich are at all fans of the government bailouts and payouts and securities for failed companies.

3/29/2009 2:35:20 PM

Hunt

I agree with just about everything you said if you are talking about the top 1% which I believe includes those that make 250K. Id say there is definitely mobility to this range, in fact I believe I could one day make money close to that with some luck, ambition, etc. And I doubt that the majority of people that make that much money are investment banker like you said.

However If we begin to talk about the top 0.1% I think most of that falls through. The mobility to this level is a lot lower and Id guess a bunch of them are investment bankers/fund managers. These are the people that I think should pay more taxes because I think they can take far more advantage of government economic regulations or loopholes such as this one.


^Troof, The government handouts need to stop or they need to get taxed more. Anything else just seems like the government is trying to keep the top of society in its place.

3/29/2009 6:34:08 PM

More fun stuff

http://globaleconomicanalysis.blogspot.com/2009/04/more-ugly-details-emerge-on-geithners.html

Quote :

"The Obama Administration insists it wants to "partner" with private investors for its new toxic-asset purchase plan. But the more details that emerge, the more it seems Treasury wants to work with only a select few companies. This is no way to conduct a bank clean-up. The investment community was already suspicious last week when Secretary Timothy Geithner unveiled his plan, announcing that Treasury would select four or five companies as "fund managers" to purchase toxic securities. Given that the whole idea is to create a liquid market for these assets, we'd have thought Treasury would encourage as many players as possible. But the bigger shock was when Treasury released its application to become a fund manager, a main rule of which is that only firms that already have a minimum of $10 billion in toxic securities under management can apply. Few hedge funds, private equity players or sovereign wealth funds come near this number. The hurdle would bar many who specialize in the very distressed assets that the Obama Administration is trying to offload from banks. Hedge Fund Intelligence recently estimated total assets under management at Avenue Capital Group at $16.4 billion, King Street Capital at $15.8 billion, Fortress Investment Group at $13.7 billion, and Elliott Associates at $12.8 billion. Presumably, the portion of these portfolios devoted to toxic assets is significantly smaller. "It's difficult to imagine why most firms would even bother to apply now," one hedge fund manager told us. Treasury rules also say the $10 billion limit must be comprised of commercial and residential mortgage-backed securities that are "secured directly by the actual mortgage loans, leases or other assets and not other securities." This is another way of saying that they must be "first tier" assets, for instance collateralized debt obligations (CDOs). But what many private players instead deal in are "CDOs squared" or CDOs secured by other CDOs, which would not count toward the requirement. This, too, will make it harder to take part in the program. While dozens of banks and insurance companies today hold more than $10 billion in toxic securities, the vast majority are trying to get these assets off their books -- not lining up to buy more. As for asset management firms that hold such a big portfolio -- and are also healthy enough to serve as fund managers -- there is only a small pool, such as Black Rock, Pimco, Goldman Sachs or Legg Mason, as well as a titan or two of the hedge fund industry, such as Bridgewater. "This is ugly," says Joshua Rosner, the managing director of Graham, Fisher & Co., an independent research firm."

4/1/2009 3:13:45 PM