Category: Government Intervention
The analysis published under this category are as follows.
Friday, September 19, 2008
Paulson Commits Trillions of Tax Payer Dollars to the Mother of All Bailouts / Stock-Markets / Government Intervention
By: Peter_Schiff
Just three days ago, after looking at the prospect of bailing a string of distressed financial institution in the country, the government seemingly drew a line in the sand, and refused to bail out Lehman Brothers. The authorities clearly saw Lehman’s demise as a trial balloon to see how the markets would react if the government stayed on the sidelines. That trial balloon quickly turned into the Hindenburg. Immediately reversing course, the Government has decided to go “all in” and bail out every institution with financial exposure to U.S. mortgages. Read full article... Read full article...
Friday, September 19, 2008
Financial Armageddon Postponed- Fed Intervenes In Money Markets / Stock-Markets / Government Intervention
By: Mike_Shedlock
The Fed has announced new liquidity measures this morning governing non-recourse funding of asset backed commercial paper and plans to purchase short-term debt obligations issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. Here is the Fed Press Release On Liquidity Measures .
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Friday, September 19, 2008
Financial Insanity: SEC Plans to Temporarily Ban Short-Selling / Stock-Markets / Government Intervention
By: Mike_Shedlock
Every time I think the height of insanity has been reached I have been proven wrong. My new official statement is: "There is no upward limit on insane actions by Congress, the SEC, the president, or for that matter anyone else." Already I need to amend a post I wrote moments ago: Stock Market Cheers Fiscal Insanity .
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Thursday, September 18, 2008
Paulson Seeks Resolution Trust Corporation "Solution" / Stock-Markets / Government Intervention
By: Mike_Shedlock
When you have done as much damage to taxpayers and the economy as Paulson has, one just might expect for him to go into hiding until the next administration fires him.Read full article... Read full article...
Thursday, September 18, 2008
Britain Bans Short-Selling Citing 'Extreme' Market Climate / Stock-Markets / Government Intervention
By: Mike_Shedlock
See Addendum: Ban is on Financials OnlyMarketWatch is reporting Britain bans short-selling, citing 'extreme' market climate .
LONDON (MarketWatch) -- Britain's Financial Services Authority on Thursday announced the unprecedented move of banning short-selling and forbidding any increase in new positions. Also, disclosure will be required on all positions of more than 0.25% of a stock. The ban is due to remain in force until Jan. 16, but it will be reviewed in 30 days.
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Thursday, September 18, 2008
UK FSA Bans Hedge Fund Short Selling After Attack on HBOS / Stock-Markets / Government Intervention
By: Nadeem_Walayat
The FSA in a statement issued a short while ago effectively bans hedge fund short-selling as of midnight tonight of financial stocks. This follows just 24 hours from my analysis (
Hedge Funds Crash Halifax, HBOS Rescued by Lloyds TSB) that in the wake of the HBOS collapse recommended UK government take immediate action to regulate short selling of financial institutions so as to allow the distressed banks time to negotiate with possible merger partners than to be forced into shot-gun weddings or worse as a consequence of relentless hedge fund short-selling that results in market panic actions that acts as a force of great instability for the whole of Britain's financial system. Read full article... Read full article...
Monday, September 15, 2008
United States to Pay the Price of Nationalization / Economics / Government Intervention
By: John_Browne
Last week, the U.S. government took the unprecedented step of effectively nationalizing mortgage giants Fannie Mae and Freddie Mac. Together, the two companies hold or guarantee some $5.2 trillion, or about half, of all American residential mortgages. A substantial portion of this debt is tilting toward default. Given the size of the numbers, American tax payers should be very concerned. Read full article... Read full article...
Sunday, September 14, 2008
Bailouts Killing Free Market Capitalism / Stock-Markets / Government Intervention
By: Money_and_Markets
Back on August 1, I asked the question: "When is enough, enough?" I wrote:
It seems like every week we get another borrower bailout initiative.
Or another multi-billion dollar package of legislation.
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Monday, September 08, 2008
Paulson Bailout of Freddie, Fannie and PIMCO Translated / Stock-Markets / Government Intervention
By: Mike_Shedlock
Financial Institutions Must Be Allowed To Fail Paulson: "Homeowners should not anticipate a government bail-out. Banks should not expect to be bailed-out by government, despite intervention by the Federal Reserve in the near-collapse of Bear Stearns in March."
Translation: Critical banks and GSEs must not be allowed to fail.
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Sunday, September 07, 2008
Government Manipulation Vs Market Forces / Stock-Markets / Government Intervention
By: Money_and_Markets
Jack Crooks writes: In America, times like these don't come around often. Usually, Americans are blessed with economic prosperity. Enduring periods of stagnant or shrinking economic growth are exceptions to the rule.
There's a big reason we've been so fortunate ... something often referred to as the market process. Contrary to what the current Federal Reserve or U.S. Treasury might have you believe, it is this naturally occurring progression that keeps the markets functioning the way they ought to function — free of interference.
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Monday, August 18, 2008
Fed's History of Bailout a Falling Stock Market / Stock-Markets / Government Intervention
By: Captain_Hook
Talk of failures and bank holidays is becoming increasing wide spread as each day passes, with good reason . Combine this with the fact it appears both price managers and the market itself are out of touch about the possibilities, and this increases potential for a ‘self-fulfilling prophecy' in this respect. In terms of being out of touch, and much like the situation prior to the stock market crash that commenced in 1929, money supply growth rates are presently insufficient to stimulate growth in the larger economy because price managers are still dealing with the effects of previous accelerations in inflation .
Tuesday, August 05, 2008
SEC Selective Short Selling Protection Ensures Survival of the Unfittest / Companies / Government Intervention
By: John_Mauldin
It is indeed a very interesting time in which to live, especially watching the financial markets. The disconnect among authorities, regulators, companies and investors is almost too much to comprehend. There are no precedents for the turmoil we are in. This week we read an essay by a name familiar to readers of Outside Box, Michael Lewitt of Hegemony Capital Management ( www.hegcap.com ). As usual he offers us some very cogent comments on the continuing efforts by those in authority to bail out the system, along with insights on the deal by Merrill and the woes at GM. It is a very interesting letter, so I will stand aside and let Michael jump in. Read full article... Read full article...
Saturday, August 02, 2008
The Cost of Escalating Fed Bailouts is Sustainable Home Ownership / Housing-Market / Government Intervention
By: Money_and_Markets
Mike Larson writes: When is enough, enough? How much is too much?
Those are the questions I've been pondering lately as I survey the housing and mortgage market landscape. It seems like every week we get another borrower bailout initiative.
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Thursday, July 31, 2008
America's Lurch Away From Free Market Capitalism / Stock-Markets / Government Intervention
By: Kurt_Kasun
The cover of this week's The Economist magazine reads "Unhappy America". To the authors' credit the article goes beyond the typical Bush-bashing and identifies several factors at play. They were treading down the right path when they observe that "Lax monetary policy allowed Americans to build up debts and fuelled a housing bubble that had to burst eventually." But rather than going into further detail in addressing the subject of easy money, the chief culprit of the financial mess we will be in for years, the authors turn their sights on the need for education, healthcare, and other reforms. The authors exercised relative restraint in assessing America's lurch away from free-market capitalism in the wake of the housing market bailout, the Fannie (NYSE: FNM ) and Freddie (NYSE: FRE ) backstop, the special protected status 17 financial companies are receiving against naked short sales, etc. Read full article... Read full article...
Wednesday, July 30, 2008
United States Abandoning Capitalism for Socialism / Economics / Government Intervention
By: John_Browne
Over the past few decades, the United States has steadily evolved from a nation of ‘producers' to one of ‘consumers'. The change has been celebrated by politicians and economists as proof of America's arrival at the top of the global economic food chain. In reality, the development has depleted the nation of its hard-earned wealth, and has led us to the brink of ruin. Read full article... Read full article...
Sunday, July 27, 2008
Government Plays Dr Seuss By Artificially Propping Up House Prices / Housing-Market / Government Intervention
By: David_Vaughn
Ever notice how those books at home on your shelves seems to grow higher and higher over the years? I noticed the same thing myself and decided to weed out the old books that no longer seemed worthwhile to keep. Among those dusty books I discovered were books that I read to my child just a few “short” years ago. The Tonka truck book, the book about trains and ships, Yertle the Turtle, Dr. Seuss. Read full article... Read full article...
Thursday, July 24, 2008
FDIC Chairman Sheila Bair Is Out Of Control / Stock-Markets / Government Intervention
By: Mike_Shedlock
In a sad twist of irony Shelia Bair is accusing blogs of being "out of control".
Sadder still is the fact that San Francisco Business Times writer Mark Calvey agrees. Please consider the incredibly inane article FDIC learns it ignores bloggers at its peril .
The federal agency insuring bank deposits learned that it can't afford to ignore the blogs following its seizure this month of IndyMac Bank, the largest bank failure since the 1980s.
Saturday, July 19, 2008
Fed Asks for Blank Check for Fannie and Freddie in Flawed Rescue Plan / Housing-Market / Government Intervention
By: Mike_Whitney
The Fed's emergency rescue plan for the financial markets is hopelessly flawed. It's a scattershot approach that doesn't address the real source of the problem; an unregulated, unsustainable structured finance system that emerged in full-force after 2000 and spawned a shadow banking system that creates trillions of dollars of credit without sufficient capital reserves. This is the heart of the problem and it needs to be debated openly. The present system doesn't work; it's as simple as that. It makes no sense to provide trillions of dollars of taxpayer money to shore up a system that is essentially dysfunctional. It's just throwing money down a rat-hole. Read full article... Read full article...
Saturday, July 19, 2008
The Financial Dogs Bitching About SEC Short Selling Ruling / Stock-Markets / Government Intervention
By: Mike_Shedlock
Many banks are bitching about the new SEC rules on shorting. On the off chance you are new to the story, it's time for a full recap from the beginning.Complete Chronological Recap
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Friday, July 18, 2008
Protecting Mortgage Giants from Slingshots / Housing-Market / Government Intervention
By: Doug_Wakefield
Whether he intended to or not, Treasury Secretary Henry Paulson's statements, in a July 15th Bloomberg article titled, “Paulson Sees Fannie, Freddie Share Purchase Only If Necessary,” show the weakness of our current financial markets.
“Fannie Mae and Freddie Mac ‘represent the only functioning secondary mortgage market,' Paulson said in written testimony today to the Senate Banking Committee. ‘Our plan is aimed at supporting the stability of financial markets, not just these two companies.'”
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