Tuesday, September 30, 2008

From bailout to buy-in

A Better Bailout Plan by David Estabrook

"Taxpayers receive preferred stock and collateral from a bank borrowing from the taxpayers, both in the full amount of the loan sought by the bank. In other words, stock plus collateral in double the amount of the loan. Taxpayers profit from a bailout before anyone else does.

Thanks to Warren Buffett and Goldman Sachs for the heads-up by disclosing the terms of their deal, which should be the low water mark for any taxpayer bailout. A higher water mark would be the terms suggested above, which are not uncommon in private equity deals and chapter 11 bailouts."

If Congress proposed a bailout like this one, I'd support it. Get some fucking equity for our $700B capital injection, and quit acting like pussies. Wait but we're Americans. "We couldn't do that because if we had - oh I mean if 'the government' had equity in these banks, that would be 'socialism'. I don't really know much about socialism except that it's a word that means "not-good", and I don't like not-good things. I can't really discuss it any further, except maybe to say that it's un-American (which is also a not-good thing)."

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