HowardBarney Frank's Mortgage Bailout Circus
August 1st 2008 13:48
Real Crash- Looking at Capitalism and its Laws:
teenage wasteland, the who
The barney bailout circus;
Is taking us on a strange trip;
Now that Bush has signed on,
The LSD's getting stronger;
The mortgage bailout is here;
But, it's not going anywhere;
Merrill Lynch has just written off;
82-cents on the dollar;
A real teenage wasteland;
Teenage Wasteland;
We're all wasted.
(Music spoof, the Who, Teenage Wasteland)
The fact that Barney Frank's bailout bill is signed by Bush, the same week that Barney Frank submits a Pot decrim bill says it all. Is Barney and George Soros taking us on a trip? This is a bad trip into nowhere. The alleged attempt to "save" 400,000 homeowners by dragging them down deeper into debt will not work at all.
Anyway, 3 million homes are going into foreclosure this year. So this is only an attempt to bail out the tail end of the Mortgage and Mortgage Backed Security market. How can Merrill Lynch write out 82-cents on the dollar of $32 billion of MBS and CDO (Collateralized Debt Obligations)? The MBS are just strips of mortgages, and they are combined into first tier, second tier, third tier etc. The mortgages at a certain point of being combined turn into toxic shock, slush, waste. Either that, or are there communities where 82-percent of the homes are in default?
And then there's the little matter of bailling out $5 trillion of Fannie Mae and Freddie Mac.
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