zondag 5 oktober 2008

Het Neoliberale Geloof 196

Bail-out leads to conflict of interest claims as
Wall Street Financiers Cash in on Crisis

New questions have been raised about the $700 billion economic bail-out of the US economy as President George W. Bush warned that the world may have to wait weeks for the benefits of the rescue package to be felt.
By Tim Shipman 05/10/09 "The Telegraph"

In a radio address to the nation, Mr Bush hailed the historic deal, the largest in US history, for providing "the necessary tools to address the underlying problem in our financial system" and "put our economy on the road to recovery".But he warned: "While these efforts will be effective, they will also take time to implement. The benefits of this package will not all be felt immediately."Doubts about the package were fuelled when financial experts warned that conflicts of interest could arise because Wall Street financiers, many of whom have been blamed for causing the financial meltdown in the first place, will have a hand in spending the $700 billion of taxpayers' money.The bail out plan, finally passed by the US House of Representatives and signed into law by Mr Bush on Friday afternoon, will enable the Bush administration to buy up the bad debts of failing banks to kick start the flow of credit through the economy.But the US Treasury does not have the staff to make the decisions about which banks and which debts to buy up and will instead spend the next few weeks hiring Wall Street experts to do the buying for them.It is a move reminiscent of the US government's controversial use of private military contractors to fight the war in Iraq.Experts warned the approach is laden with financial pitfalls, since it may be impossible to find independent contractors who do not have a vested interest in which debts to buy and the price at which they buy them.The companies hired to identify and buy the bad debts will have to make decisions that affect the same firms whose shares they own. In some cases they might effectively be buying up their own bad debts.The warning flag was raised yesterday by Alan Blinder, a former vice chairman of the Federal Reserve. In a reference to the respected former chairman of the Fed, he told the New York Times: "With anyone short of the stature and honesty of a Paul Volcker running it, you need to worry a lot about conflicts of interest."Unfortunately, there just aren't many people with the expertise you need but without any possible conflicts."Between five and 10 asset management companies will also be paid a commission on the work they do. While Treasury sources say it will be less than the one percent surcharge companies usually charge on transactions, they can still expect to make several billion dollars in profits between them.The revelations will fuel anger among US taxpayers who blame Wall Street greed for the economic downturn and had heavily pressured their congressmen to reject the bail out bill.'


Lees verder: http://www.informationclearinghouse.info/article20949.htm

2 opmerkingen:

Sonja zei

The Guardian: A crisis made in the Oval Office
A financial panic provoked by President Bush was designed to stampede Congress into passing the bail-out for Wall Street
(Dean Baker is co-director of the Centre for Economic and Policy Research.)

Vrije-wereldburger zei

In de VS en zeker ook in Nederland denken "gewone mensen" nu echt niet dat Bos het zo goed doet en dat we in onze handjes mogen knijpen dat we duizend euro per mens mogen opbrengen voor de knoeiers die Fortis en ABN AMRO op de klippen hebben laten lopen.

Het is juist een beetje beangstigend dat er in het parlement geen enkele stem is voor de ontevredenheid die aanzwelt. Overal wordt op bezuinigd, alle nutsbedrijven zijn aan "de markt" overgeleverd en nu is het plotseling een stout staaltje dat Bos deze bank "redt" van onze centen?

Geen partij die deze onvrede vormgeeft op politiek niveau, geen mainstream medium dat dit bovenbazengeschuif ter discussie stelt. Dan zal vroeg of laat de opstand van het kiesvee net zo'n verrassing voor de heersende klasse zijn als deze crisis ("niemand heeft dit anderhalf jaar geleden voorzien" - laat mij er buiten, vent!).

Gaza proves Humanity is far more Backward than we Thought

  Gaza proves Humanity is far more Backward than we Thought By   Stuart Littlewood  -  December 23, 2024 1 NEW YORK, NEW YORK - SEPTEMBER 27...