Paulson changes tack on financial rescue Consumer-finance sector will get help, but mortgage asset plan's shelvedPaulson, Bernanke defend financial market rescue effortsTreasury Secretary Henry Paulson and Federal Reserve Board Chairman Ben Bernanke defended on Tuesday their stewardship of the $700 billion financial market rescue plan. In prepared remarks to the House Financial Services panel, Paulson said that there was "no playbook" for the Bush administration to follow and so strategy had to be adjusted. He said the financial markets would be worse off if Congress had not approved the package. Bernanke said he saw some improvements in credit markets, but said overall conditions remain "far from normal." Paulson defended his decision not to use funds from the package to aid homeowners. He said the best way to turn the housing market around was to "increase access to lower cost mortgage lending." He argued that the government takeover of Fannie Mae and Freddie Mac was an important step in that direction.
[url=http://www.marketwatch.com/News/Story/Story.aspx?guid={1AC4936B-1C89-4D34-A4F7-B5EAA1E41E86}&siteid=nbsh]THERESE POLETTI'S TECH TALES Layoffs loom like dark clouds over Silicon Valley Commentary: It's probably only the beginning of an ugly downturn[/url]
Paulson not likely to tap rest of TARP money, he saysThe Treasury Department isn't likely to ask for Congress for authority any time soon to use the second half of the $700 Troubled Asset Relief Program, Treasury Secretary Henry Paulson said Monday in an interview with the Wall Street Journal. "I'm going to do what we need to do to keep the system strong but I'm not going to be looking to start up new things unless they're necessary, unless they make great sense," Paulson said. "I want to preserve the firepower, the flexibility we have now and those that come after us will have." Most of the first $350 billion has been committed to buying equity shares in large and smaller banks, and in American International Group (AIG:
American International Group, Inc AIG 1.67, -0.28, -14.4%) . Decisions about the second tranche will likely be made by President-elect Barack Obama's administration.
Buffett says automakers need bailout or bankruptcyThe government should insist top executives at Ford Motor Co., General Motors Corp. and Chrysler LLC invest a significant percentage of their own net worths in the Detroit-based companies, Buffett said, ensuring both executives and taxpayers would share in any profits or losses.
Buffett said the government should be able to drive a deal like one of the ones he makes when Berkshire buys businesses, because automakers appear on the brink of bankruptcy.
Buffett said he’d tell the auto executives, "’We’ll give you more upside (than bankruptcy), but you’re going to lose if we lose.’"
Great Idea! Why not expand this idea to all UAW workers so that we avoid the principle-client problems even more.
Ford {F} has market equity cap: $3.7 Billion {Price: $1.55}
GM {GM} has a market cap: $2 Billion {Price: $3.22}
Approximately there are about half a million UAW workers and thus each UAW worker merely has to pitch in $2,000 to buy GM and $3,700 to buy all of Ford. So why not make them invest in it also? Karl Marx would be surprised at the failure of workers to pay such a small amount to control the means of production. I am sure he is rolling over in his grave...
