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Discussion in 'Economics' started by fibonelli, Oct 1, 2008.


    Suggested Fax/Email Text

    Fax Title: Rep. Brad Sherman On Bailing Out Foreign Investors

    Dear senator/congress representative

    Today I listened to Representative Brad Sherman on how the Paulson proposal will purposely bail out foreign investors.

    Here is the shocking text as translated from CNBC in an exchange with Larry Kudlow.

    Rep. Brad Sherman, D California:

    Larry I am glad you have a few seconds to talk to someone who voted against this bill. I am not changing my mind. I want to thank my colleagues who stood up to the purveyors of panic and voted against a very bad bill and voted with 400 eminent economists including three Nobel laureates who wrote to us and said don't panic, don't act hastily, hold hearings, work carefully. The fact is Larry if you read this bill, even you would have voted against it.

    It provides hundreds of billions of dollars of bailouts to foreign investors. It provides no real control of Paulson's power. There is a critique board but not really a board that can step in and change what he does. It's a $700 billion program run by a part-time temporary employee and there is no limit on million dollar a month salaries.

    Larry Kudlow:

    Let me just ask you one question. I think you are referring to foreign banks headquartered in the United States. I do not see how foreign investors get bailed out.

    Rep. Brad Sherman:

    Larry you have to read the bill. It's very clear. The Bank of Shanghai can transfer all of its toxic assets to the Bank of Shanghai of Los Angeles which can then sell them the next day to the Treasury. I had a provision to say if it wasn't owned by an American entity even a subsidiary, but at least an entity in the US, the Treasury can't buy it. It was rejected.

    The bill is very clear. Assets now held in China and London can be sold to US entities on Monday and then sold to the Treasury on Tuesday.

    Paulson has made it clear he will recommend a veto of any bill that contained a clear provision that said if Americans did not own the asset on September 20th that it can't be sold to the Treasury.

    Hundreds of billions of dollars are going to bail out foreign investors. They know it, they demanded it and the bill has been carefully written to make sure that can happen.

    Senator, please scrap the Paulson proposal in entirety and try something that might work, that is constitutional, and does not put taxpayer money at risk.

    US citizens should not spending $700 Billion to bail out foreign investors. The actions of Treasury Secretary Paulson go far beyond disgusting, to outright betrayal of US citizens.

    I ask that you take a clear stand against this un-American bill by not only voting against it, but to Filibuster the bill until it is given up for dead. I cannot and will not vote for any legislator who votes for this bill, or even allows it to be brought up for vote.

    Senator, the United States of America is depending on you to block this bill for the good of the country.

    Your Name
    Your Phone Number
    Your Email Address
    Contacting the Congress

    Scroll down article for full list of contact numbers for congress and senate representatives

  2. 105 views and one bump


  3. jprad


  4. The Chinese hold $500B+ of our T-Bonds... and we NEED them and others to keep buying them. Perhaps relieving them of their "toxic bad bets" is a price we have to pay to keep them buying our Crapola...

    Not that Paulson would disclose this arrangement, or anything...
  5. > gnome

    this is bull$hit. There is no reason whatsoever for the proposed bill to go through in its present form.

  6. bump. I've contacted my rep and asked an addendum be added to the bill: reset particular classes of mortgages to Prime+1 for a fixed period of time. This will free up capital with the consumer, punish the lenders that got us here, and negate the need for 700 billion to transfer "toxic assets".
  7. jprad


    Hold on there...

    Anyone buying structured derivatives built on subprime mortgages deserves the very same comeuppance as every idiot that got overextended buying overpriced property with a teaser rate mortgage without having the means to pay for it.

    I also don't see why we should be so scared of the Chinese or anyone else holding tons of T-Bill.

    It's sort of an economic MAD scenario. Selling them in any quantity would create an avalanch and destroy both economies since they need our consumers as much as we need them to buy our bills.

    Cooler heads need to prevail and figure out a long-term way out of this mess.
  8. This is not about wall street so much as it is about the average joe losing his job because businesses are unable to borrow the loan capital they need to continue funding and expanding their operations.

    Haven't you heard? Banks stopped lending.

    Sure, if your credit is stellar, the bank will still approve you for the
    money (maybe) but you won't get the money -- at least not right away. You won't get the money until this crisis is resolved.

    This crisis has no chance of resolving itself until the government
    can get the banks to start loaning money again.

    In the meantime, the markets will continue to crash.
    People's 401k and Pensions will take a tremendous dive.
    Overseas investors like China and European nations will begin to lose confidence in our system and start pulling their investments out. And the dollar may become worthless paper.

    I heard that even individuals with CD's at the bank can't get
    a loan against their CD currently.

    So I hope you have lots of gold stored away because if congress continues to listen to the ignorant populus and not do the right thing then hello depression.
  9. sprstpd


    You bought the party line hook, line, and sinker.
    #10     Oct 2, 2008