Our financial system is crumbling this week.

[Simbagal23]

Correct me if I'm wrong (because it's happened before!) but I thought I heard on the news or read somewhere that the top guys for Fannie Mae and Lehman Bros made millions this year and will walk away from this mess scott free?

[TimeForGuinness]

Correct me if I'm wrong (because it's happened before!) but I thought I heard on the news or read somewhere that the top guys for Fannie Mae and Lehman Bros made millions this year and will walk away from this mess scott free?

...wouldn't surprise me

[Arthur Dent]

Alan Greenspan, the man who presided over the buildup of two huge asset price bubbles over a decade, is strangely quiet nowadays.

He's still getting interviews and not being asked about his statements denying the existence of those bubbles.

--------

What's up with the ban on short sales of financial company stock? Don't these companies deserve to have their share values targeted by short sellers? Why do we have a federal share price support program?

[Radbird]

Dow is up another 379 so far today.

[TheoSqua]

Correct me if I'm wrong (because it's happened before!) but I thought I heard on the news or read somewhere that the top guys for Fannie Mae and Lehman Bros made millions this year and will walk away from this mess scott free?

...wouldn't surprise me

The CEO from Lehman received a 22m severance package.

So what do you get for running one of the biggest and longest tenured financial companies in the world into the ground?

$22,000,000.00

I'm in the wrong industry...

[Hungary Jack]

Correct me if I'm wrong (because it's happened before!) but I thought I heard on the news or read somewhere that the top guys for Fannie Mae and Lehman Bros made millions this year and will walk away from this mess scott free?

...wouldn't surprise me

Blame them a little, but blame those responsible for federal oversight of them more.

[Arthur Dent]

http://www.nytimes.com/2008/09/20/washi ... -cong.html

Congressional Leaders Stunned by Warnings

...

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”

Mr. Schumer added, “History was sort of hanging over it, like this was a moment.”

When Mr. Schumer described the meeting as “somber,” Mr. Dodd cut in. “Somber doesn’t begin to justify the words,” he said. “We have never heard language like this.”

“What you heard last evening,” he added, “is one of those rare moments, certainly rare in my experience here, is Democrats and Republicans deciding we need to work together quickly.”

Although Mr. Schumer, Mr. Dodd and other participants declined to repeat precisely what they were told by Mr. Bernanke and Mr. Paulson, they said the two men described the financial system as effectively bound in a knot that was being pulled tighter and tighter by the day.

“You have the credit lines in America, which are the lifeblood of the economy, frozen.” Mr. Schumer said. “That hasn’t happened before. It’s a brave new world. You are in uncharted territory, but the one thing you do know is you can’t leave them frozen or the economy will just head south at a rapid rate.”

As he spoke, Mr. Schumer swooped his hand, to make the gesture of a plummeting bird. “You know we’d be lucky ...” he said as his voice trailed off. “Well, I’ll leave it at that.”

...

[TimeForGuinness]

http://www.nytimes.com/2008/09/20/washi ... -cong.html

Congressional Leaders Stunned by Warnings

...

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”

Mr. Schumer added, “History was sort of hanging over it, like this was a moment.”

When Mr. Schumer described the meeting as “somber,” Mr. Dodd cut in. “Somber doesn’t begin to justify the words,” he said. “We have never heard language like this.”

“What you heard last evening,” he added, “is one of those rare moments, certainly rare in my experience here, is Democrats and Republicans deciding we need to work together quickly.”

Although Mr. Schumer, Mr. Dodd and other participants declined to repeat precisely what they were told by Mr. Bernanke and Mr. Paulson, they said the two men described the financial system as effectively bound in a knot that was being pulled tighter and tighter by the day.

“You have the credit lines in America, which are the lifeblood of the economy, frozen.” Mr. Schumer said. “That hasn’t happened before. It’s a brave new world. You are in uncharted territory, but the one thing you do know is you can’t leave them frozen or the economy will just head south at a rapid rate.”

As he spoke, Mr. Schumer swooped his hand, to make the gesture of a plummeting bird. “You know we’d be lucky ...” he said as his voice trailed off. “Well, I’ll leave it at that.”

...

From that same article:

Lawmakers in both parties described the meeting in Ms. Pelosi’s office on Thursday night with Mr. Paulson and Mr. Bernanke as collaborative, and that they were prepared to put politics aside to address the needs of the American people.

Geez...I wish they ALWAYS did that...(sigh)

[greenback44]

Some people spend most of their workday on the Internet. Politicians play politics. Just imagine what it must be like in countries that aren't nearly as productive as we allegedly are.

So anyway somebody at work passed along this AIG timeline: http://www.bloomberg.com/apps/news?pid= ... t0k8u6my5Y

My two favorites:

Aug. 8, 2007: AIG posts second-quarter profit that rose 34 percent to $4.28 billion and doesn't announce any writedowns on subprime assets after analysts said the company could lose as much as $3.25 billion in a worst-case scenario. Results are released on a day when AIG's stock closes at $66.48.
...
Nov. 14: AIG announces a new $8 billion stock repurchase six days after the company's shares hit a 52-week low of $56.

They had no clue. If I ever get some free time, I may have to research stock performance after an announcement of a stock buy-back. It's such an obvious ploy to manipulate the stock price that I'm wondering if it's a sign that management has decided to "fix" financially what they can't fix in operations.

[arnie.k]

so are they going to fix this at the core, by regulating the markets, and addressing managerial compensation. or are they just giving the money away and waiting until this happens again on a bigger scale? one of these days wall st. will gamble on amounts the US gov't can't cover...

also, i'm very surprised at the low amounts of rage you guys are exhibiting on this whole thing. in the early 80's we had a similar collapse. banks were running funds that were buying bank stocks, inflating their own value by taking out loans to buy their own stocks. the economy collapsed leading to triple digit inflation rates, and a recession that took 10 years to overcome.

when they were caught, public rage forced both a complete rebuild of the regulation process, and put a few dozen bank executives behind bars. (some are just getting out now). we are by the way, pretty immune to the problems facing the US and europe right now, due to said regulation.

i'm not seeing this happen with the american public. it's like you guys are accepting this as "necessary evil". is this true? aren't you guys enraged with these people? your gov't is spending $1T of your money to fix a mess a few wall st. people made which will lead to lack of spending on stuff you need, to inflation and probably a huge recession. and you guys don't even seem pissed off...