The Republican Base looks like it is getting its bailout from the last gasps of President Jo Jo The Idiot Boy’s rule. The Dow closed 400 points higher today on a report that the Treasury Secretary Henry Paulson is considering the formation of a government-funded entity to help financial institutions. This is not a new concept.
When the Savings and Loan scams came crashing down in the late 80’s and early 90’s, something called the Resolution Trust Corporation was created to catch the shards. The RTC was set up by the Feds to manage and eventually liquidate all the non-performing loans that the S&L’s had written or bought. Over time the RTC sold off loans, real estate and land in tiny packages of government-backed notes that contained some reasonable stuff along with a few pieces of financial fecal matter.
This was during the reign of Dutch Regan and George H.W. Bush, by an amazing coincidence. Henry Paulson was a partner at Goldman-Sachs at the same time.
The anticipated entity that Secretary Paulson might (or might not) create would act as a toilet for investment banks to squirt out their worst loans. The water will be deep, nicely warmed, with a significant drop. Even a high-fibre Lincoln Log of mortgage-backed securities, loans to ex-Nigerian government ministers and family members of Saddam Hussein won’t splash up on the banks, investment houses and financial institutions.
Over the next few years, if past-practice is followed from the S&L mess, someone will go through it, looking for the shiny bits in the sewage. Those will be packaged up with a ribbon and sold in small slices backed by the US Government.
Which brings up the observation, as Daddy Bush and Dutch Regan bailed out Neil Bush from Silverado Savings and Loan, it would seem that President Jo Jo The Idiot Boy is going to bail out most of Wall Street as his last act as “The Decider Who Decides the Deciding as the War President against the Evildoers Axis of Evil Axis.”
Since Daddy is still alive along with Shotgun Dick and the rest of the Base, be assured that the lid of the investment toilet is going to be up and various contributors to their lifestyle will be invited to take a seat, read for a bit and go on with life as usual.
As a taxpayer, you’ll get to wipe up for them. The paper you’ll use is the American Dollar.
RoadDave 