Jim Rogers: Bank Bailout is 'Horrible Economics'
By Susie Madrak Friday Dec 12, 2008 7:00pmJim Rogers, who cofounded the Quantum Fund with George Soros, attacks the bank bailout as "wrongheaded" and says most of the major banks are already bankrupt:
"Without giving specific names, most of the significant American banks, the larger banks, are bankrupt, totally bankrupt," said Rogers, who is now a private investor.
"What is outrageous economically and is outrageous morally is that normally in times like this, people who are competent and who saw it coming and who kept their powder dry go and take over the assets from the incompetent," he said. "What's happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics."
[...] Goldman Sachs & Co analysts this week estimated that banks worldwide have suffered $850 billion of credit-related losses and writedowns since the global credit crisis began last year.
But Rogers said sound U.S. lenders remain. He said these could include banks that don't make or hold subprime mortgages, or which have high ratios of deposits to equity, "all the classic old ratios that most banks in America forgot or started ignoring because they were too old-fashioned."
Many analysts cite Lehman's Sept 15 bankruptcy as a trigger for the recent cratering in the economy and stock markets.
Rogers called that idea "laughable," noting that banks have been failing for hundreds of years. And yet, he said policymakers aren't doing enough to prevent another Lehman.
"Governments are making mistakes," he said. "They're saying to all the banks, you don't have to tell us your situation. You can continue to use your balance sheet that is phony.... All these guys are bankrupt, they're still worrying about their bonuses, they're still trying to pay their dividends, and the whole system is weakened."
Yep. The pointless bailout, the one that only postpones the inevitable, is embraced warmly by the Republican party while the one that actually provides a product and employs millions of working-class people is rejected. It's the blue shirts vs. the blue collars.
Jim Rogers also says we should Abolish the Federal Reserve!!!
http://www.youtube.com/watch?v=6KLtm7-O4z8 (the 3:20 mark)
Let's discuss that too :)
[Let's do that when it's on topic- or on an Open Thread. Thanks. Site Monitor]
The Federal Reserve is an incredibly lucrative scam for the people behind very rich commercial banks. There's no reason the government shouldn't issue its own currency.
...the federal reserve...the ones who print the money...are off topic!
( That site monitor wanted it taken to an open thread.
Is that so incredible? SiteMonitor
Here is what I said about the last Capitalist you pointed to.
These guys are in the game strictly for themselves.
I would march them all off a short pier into a deep sea.
And you say:
The Bank
BailoutHeist was mainly supported by the Democrats until the $700 Billion was blown up to $850 Billion at which point the Republicans signed on also.I call it the Bush Obama Machiavelli Bailout, or BOMB for short.
It is the best Government that Wall Street Money can buy.
The Treasury combined with Federal Reserve now has a commitment of $8.5 Trillion.
Can you say Zimbabwe?
Update:
It is not about the Banks, it is about their Creditors.
Of course the Banks were bankrupt, at least until we bailed them out, if they had gone into bankruptcy court they would have had protection from their creditors. Their Creditors would have gotten pennies on the dollar.
It also would have been learned in Court documents who held what.
This is Casino Capitalism. Their Creditors made gambling bets with the Banks, the Banks were bookies.
The Banks had very risky Investment Securities, in order to sell them World Wide they also sold Credit Default Swaps which were like insurance, but it was unregulated and they didn't need to have the money to pay. At least until the entire ponzi scheme went bust.
Then they needed the money, we the people, our Government gave it to them.
We are bailing out the Bookies, but more than that we are bailing out the Gamblers. Each risky security could have 10, 20 even 50 times its value in Swaps. The only Swap that was reasonable was held by the entity with the underlying security.
All of the rest were speculation, GAMBLING.
People in the Mortgage pipeline who knew those Securities would go bust may well have bought Swaps, in effect betting against their own professional work.
I have little doubt they did and it is racketeering, on a vast scale. Those are the people I want identified.
We are paying them off.
They take the money, no strings attached, they can even use it to keep lobbying Washington into giving them more money.
This is a corrupt system that has gone insane.
But how is stating the obvious newsworthy? I feel as though every day or so I hear some new banker or capitalist decrying the greatest swindle to ever happen upon the American taxpayer. Where were these people when our elected officials were actually voting on the bailout?
is one of the good guys. He's been on this a long time as have a few notable others - Roubini, Schiff, Faber, e .g. I criticize much more strongly the U.S. MSM who gave scant coverage or otherwise tried to marginalize these dissenting, but accurate views.
The MSM pushed the bailout hard and failed the American Public (big surprise). I guess I am just extremely frustrated by the impotence of our policy makers to hold these financial institutions accountable.
If you read those 5 alarmists/downers these last couple of years - Rogers, Roubini, Schiff, Faber and Stiglitz, you would not be surprised at all to find yourselves where you do today. They had it exactly right. Why hasn't Obama tapped one of these guys? Stiglitz should be the Treasury Sec.
Remember one of the strongest voices for the TARP passage? A man who said if his colleagues didn't do this and do it now and trust Paulson, they were responsible for the chaos later? - Barack Obama.
I couldn't agree with you more. I remember back in September sending angrily worded e-mails (also calls) to his campaign and his senate office. I am still pissed off over the passage of TARP. If Obama had taken a stand, maybe the democratic caucus would have acted in a different way. Both parties have their hands dirty in this debacle.
one of the banks that took federal bailout money used it to purchase three brand new CHINESE corporate jets??
WHAT THE FUCK?
???
The bailout is more proof that in DC, it's not Repugs vs Dems. It's DC insiders vs the rest of us. And we're losing badly.
The banking establishment/Wallstreet vs the rest of us.
And that is not a new thing, at all...
s If you head over to HuffPo, they have a great article on the Federal Reserve refusing to name the recipients of nearly two trillion dollars of American tax payer money. How much more outragious do things get before we the people realize that we've been had by the very people who are supposed to be doing the peoples business?
When Paulson came to Congress and said if we don't do something and fast the entire system would implode. Congress acted and basically gave Paulson a free check to spend at will. They also said that there would be oversight, and yet the Federal Reserve a private banking cartel that DOES NOT have to answer to Congress can refuse to disclose who they are giving our money to?!?!?! WTF! Talk about a cozy arrangement. So now we come to find out that there are a lot of foxes ( Congress ) guarding the hen house ( The Federal Resrve ).
I keep asking myself if Obama is either up to the challenge and a real agent of change, or will he be just another figure head doing the New World Oders business? I guess time will tell. But make no mistake about it. When the Federal Reserve was created against the will of the founders who never wanted a central bank but for the US Treasury to controll the flow of money, the congress in 1913 sold its soul to the devil and congress today seems just as comfortable with this arrangement in not demanding that the Federal Reserve fully disclose who they are giving our money to and for what reason.
One other thing the powers to be in the US might want to get concerned about. The riots in Greece for the last week are spreading to countries like France where they are burning cars and riots in Denmark, Spain and other countries. People are fed up being squeezed financially and the business of replacing glass windows for banks in Europe are making money hand over fist as business is brisk these days. How much longer do we have to suffer the fools in D.C. before the natives might start getting restless here? This story was posted at the CBS news site.....
CBS/AP) Unrest that has gripped Greece for the past six days showed troubling signs of spreading across Europe, as violence erupted in several cities.
Angry youths smashed shop windows, attacked banks and hurled bottles at police in small but violent protests Thursday in Spain and Denmark, while cars were set alight outside a consulate in France. Protesters gathered in front of the Greek Embassy in Rome on Wednesday and some turned violent, damaging police vehicles, overturning a car and setting a trash can on fire.
Authorities say the incidents have been isolated so far, but acknowledge concern that the Greek riots - which started over the police killing of a 15-year-old on Saturday - could be a trigger for anti-globalization groups and others outraged by economic turmoil and a lack of job opportunities.
It was FOIA suit by Bloomberg to find where more than TWO TRILLION already spent has gone.
The Federal Reserve is not going to say where it went.
Between the Treasury and the Federal Reserve they have committed $8.5 Trillion, more than half of an entire years GDP.
This is money being printed with nothing behind it.
Hyper inflation here we come.
I read somewhere today that a federal Judge turned down Bloombergs FOIA request. So I guess we're screwed again.
I too heard that story about the Fed refusing to list what banks or institutions they have given money to. Even when Bloomberg tv tried to use the courts under the Freedom of Information Act, the Fed essentially told them no. We truly are screwed because the Fed is not accountable to anyone.
the fact that a significant amount of the funds have gone overseas.
Thus making the American public look even more foolish, if that is possible.
Yes, we are being had, and most don't even seem to notice!
We should be striking with pitchforks and torches.
Abbie Hoffman wasn't popular mocking the Who at Woodstock, but he was right. The sad thing is that the myth of American rugged individualism is our worst enemy. We're not 300 million "rugged" individuals, we're 300 million _isolated_ individuals. And isolation is spelled I-M-P-O-T-E-N-C-E. Until there are literally mobs with pitchforks aiming to see these society-murderers strung up, we _will_ get fooled again and we _are_ gonna take it.
Have to admire the stratosphere in which these people operate so omnipotently though. I was at the prime teen years to love the early Bond movies but even Goldfinger didn't have the Federal Reserve and the White House riding shotgun for his thievery. Truth _is_ stranger than fiction.
Duuuude, your not supposed tell anyone!
-AF
Andrew Sullivan Is A Fraud
Saw this at the HP:
"Sure, Governor Blago might have always been a hoodlum numbskull but how else to explain super lawyer Marc Dreier suddenly gambling an insanely lucrative legitimate career to try to con hedge funds out of as much as $380 million? And just yesterday seventy-year-old Wall Street legend Bernard L. Madoff stands accused of one of the most egregious white collar crimes in history -- bilking his investors of as much as $50 billion.
Do they know something we don't know? It's as if the risk of getting caught was outweighed by their panicked desire to get as much as they could before it's all gone.
It's as if the architect of the Titanic, minutes after they brushed the iceberg, said, "Don't mind me, I'm just going out for a smoke," when really, knowing what he knew about the ship's chances, stole into a lifeboat and set off alone into the dark cold waters"
http://www.huffingtonpost.com/trey-ellis/thin...
I had a bad feeling when they started talking about socialism and did it.
I kept hearing about some closed door session of Congress back in March of this year from a friend that trades gold and silver for a living. I also found it a few days ago posted on a financial blog at CBS MarketWatch. If true, things are getting scarry big time.
MARCH 14 CLOSED DOOR SESSION LEAKS
1. the imminent collapse of the U.S. economy to occur by September 2008,
2. the imminent collapse of US federal government finances by February 2009,
3. the possibility of Civil War inside the USA as a result of the collapse,
4. advance round-ups of "insurgent U.S. citizens" likely to move against the government,
5. the detention of those rounded-up at "REX 84" camps constructed throughout the USA,
6. the possibility of retaliation against members of Congress for the collapses,
7. the location of "safe facilities" for members of Congress and their families to reside during expected massive civil unrest,
8. the necessary and unavoidable merger of the United States with Canada (for its natural resources) and with Mexico (for its cheap labor pool),
9. the issuance of a new currency - THE AMERO - for all three nations as the proposed solution to the coming economic Armageddon.
France had a revolution after people finally realized that the church and the aristocracy were robbing the country blind...
In France they knew they were being exploited, the revolution arouse from people who had had enough of the abuse. Not because all of the sudden they figured out they had been abused.
Trust me, they were damn well aware what their situation was.
Where can we set up the guillotines?
Go with lethal injection. Indications from the many botched ones suggest it hurts like hell. Since the Bush Supreme Court wouldn't rule on "cruel and inhumane" it would be poetic justice.
Seriously people can't catch a break from getting hit by hurricanes left alone to getting stuck with a mortgage that they can't pay and now car companies getting bailed out. Let them go under no other country would ever bail out companies like this.
...Security and Prosperity Partnership w/Canada and Mexico was signed and has been in effect for the past couple of years. There are all kinds of working groupls and committees in operation on many facets of trade, policy, etc.
And, in February of this year, the US NorthCom signed an agreement with Canada's military to allow troops into one another's country in the event of "civil unrest." I'd say things are not looking too shiny for the new year.
Someone reliable better check Fort Knox before Bush is permitted to leave town. Bleeping crook has probably stolen the gold bullion. I swear this SOB has to be a foreign agent the way he's sabotaged every principle on which our nation was founded.
We have been off the Gold Standard since Nixon. BIG MISTAKE! All that gold has been being shipped abroad to pay for our debts and buy oil. We have what is known as Fiat Currency, which means it isn't worth anything other than whatever faith people have in it, or to put it another way, it isn't worth as much as one of those crummy cars.
Do you realize that Jim Rogers also opposes the auto bailout? And, everything he said about the banking bailout can be applied to the auto bailout.
The auto bailout is a LOAN- not a handout- with oversight. and it's under $20Billion, not over $500Billion.
so? you can have a discussion about any of your points.
fact is, jim rogers says the exact same things quoted above about the auto bailout.
youtube has the video evidence.
deceiving blog post.
I know nothing about economics and that is why I couldn't understand how car companies with more debt than equity were actually paying dividends. I also can't understand why short selling is legal...borrow stocks you don't actually own, and yet actually sell them with the aim of driving the price down so they can be bought back and replaced for profit. Why would anyone be in the market with this going on?
And if so much money has disappeared off the books due to the crash, was it really there in the first place? If it was, then where is it now?
Those are great questions and that is what Rogers is getting at. NO one really knows where that money went and to whom. Now, the U.S. Government is just handing over large bailouts to the banks and no one really knows where that is going either. Even if a person has a lot of faith in the banks there is always that possibility that those bankers could be pulling off a massive fraud and the Government hasn't even called them on it. Damn, that is exactly what the Soviet Union did to.
I expect those years (like last year) where hedge fund managers were bringing home a billion dollars, or hundreds of millions at a minimum, for their "work" goes a long way to explaining where the money went to.
Funny how we don't hear about those jokers any more...
shortselling must be legal.
have you ever borrowed a 50$ bill, spent it, and gave back another 50$ bill to the lender?
same thing. of course you're not speculating on a changing value of the 50$ bill, but you can't make something perfectly legal illegal depending on the intention.
blaming a crises ón shortselling is bs.
Apparently Susie Madrak likes to spread inaccurate information Republican style. She wrights deceptively...........
"Yep. The pointless bailout, the one that only postpones the inevitable, is embraced warmly by the Republican party while the one that actually provides a product and employs millions of working-class people is rejected. It's the blue shirts vs. the blue collars."
If I remember correctly the only people who voted against the massive theft of the banker bailout were a few republicans. This theft by giving money to people who were already known to be thieves was embraced and pushed for by George Bush, his remaining Republican toads and his Democrats. The Democrats in congress are just as stupid, spineless, or corrupt as the republicans. The bailout of the Car Makers is just more of the same though with a smaller amount of money to be wasted. These car manufactures were stumbling or failing long before the financial crisis finally became apparent to everyone. Just how are they going to survive selling enough cars even if vastly improved and more efficient over the coming years as we plunge further into the deepest recession ever seen. Most people don't buy cars or much of anything during these periods of financial stress. Bail out the car makers now and save them for a short time only to see them go under or become greatly reduced anyway. We all wanted change so much but resist and refuse to except it when it happens. Left and right we live in a nation of fools and people like Susie Madrak who deceive fools. Its very distressing to see such BS on this blog.
CitiGroup is one of those banks he's talking about. I've known they've been bankrupt since early 2007. It's only the massive infusions they keep on scamming from the Arabs that kept them afloat. But since they've lost a lot of criminal money they were laundering the scandal would be too large to suffer to the system. 90% of the reason for this no-oversight farce of money giving is on their behalf... Mr. Rubin and a few Likudniks don't want to go to jail
Obama voted for the bailout!
Dear Susie Madrak, I dare you to "Google" ...Bailout vote breakdown.
You are spreading false information...more democrats voted for the bailout than republicans.
copy paste..."The 263-171 roll call Friday by which the House approved a $700 billion government bailout bill for the battered financial industry.
A “yes” vote is a vote to pass the bill.
Voting yes were 172 Democrats and 91 Republicans.
Voting no were 63 Democrats and 108 Republicans."
http://inthesenewtimes.com/2008/10/03/house-r...
looks like democrats are the "warm embracers" not repubs.
The Dems are more for tossing money at the rich in this scam than the Republicans. Why does everything that happen scamwise, always seem to be dissected in a partisan way? BOTH parties are in bed with the banks. BOTH parties are trying to throw invisible money at the economy, hoping something will stick and turn things around. Just like the auto "loans", everything is getting painted Dems vs Reps, when in reality, nothing is further from the truth.
We should all note, BTW, that the Financial Advisor to Lehman Brothers was none other than Jeb Bush!
The Bush Crime Family and their neo-con, CFR, Skull&Bones cronies have their grimy little fingerprints all over every nasty thing that has happened in this nation for the past 75 years. Now, they are so arrogant they commit thier crimes in plain sight and no one really pays atttention. We are so-o-ooooo-ooooo Screwed!
Be alert! Be aware! The arrogance you see is from the people who killed the Kennedy's (The English really wanted to know this), King, and they are called "the economic royalists". They believe they are royalty. They took our Mason vows and twisted them. Now,they are robbing the treasury's and putting the money in the banks they already robbed. We're not screwed! But we do have to be aware and we do have to take action when necessary. This crime family and it's cohorts will come to justice. Watch what is happening. The arrogance is too thick to ignore...Seig heil! Shultz "does know something Col. Hogan". This is a unique time in history. Welcome to an era. Once the dumbfucks come out of their ether we'll have it all together.
Robin of Luxely/ Long Live Richard the LionHeart!God Bless America
There are, be it friend or foe, pieces of truth in conflicting views. When you set aside your bias, you can successfully collect enough pieces to complete the puzzle, the image will be eminent. A great tool, if that is what I may call it, is the extremely prevalent and effective use of division to cloud the facts and foster errant speculation. Disregard your opponent off hand, may prove to be a grave mistake.
It is technology that has always shed light on the unknown, not to discount time as a factor as well. I do not like the Federal reserve and at the same time cannot fathom a cure do too my intelligence. The truth can be slowed but not stopped. Time will tell, it does more often then not. If you got this far, thank you for your time :-)
and you guys complain about the MSM?
this blog post is pure propaganda.
1. the republican party didn't "embrace" the wallstreet bailout. hardly half of them voted for it in congress, only after a lot of bribes were added to the bill. democrats led the initiative, with bush.
2. jim rogers is AGAINST the auto bailout. he is saying THE SAME things about the detroit bailout.
When it comes to the economy, opinions are like assholes: everyone has one, and they all stink (except mine).
Susie's posts tend to pick one guy's
assholeopinion, and then say, "See? The experts agree with me!"When did balance, nuance and complexity come down with the cooties?