Avoiding Use of Taxpayer Money; No More Bailed Out Firms

April 15, 2011

Avoiding Use of Taxpayer money

The Obama administration has formed the The Dodd – Frank Wall Street Forum which now determines how they can safely liquidate firms instead of turning to the taxpayers to bailout these failed companies. (Click onto the tile of the article to read more about this…)

No More Bailout Money for Failed Banks

September 22, 2009

Phot by sVilen001

Phot by sVilen001

The Federal Deposit Insurance Corporation is seeking private equity firms to buy out troubled banks so as not to put an unnecessary strain on their budget.

Many more banks are slated to fail in the coming months because of defaults on real estate loans. It will not be easy to find private equity buyers as many are reluctant to take on the losses of these failed banks.

Out of the seventy-seven banks that have been closed, sixty-nine buyers have been found. The danger of exhausting the FDIC’s fund has caused Walter Buffet to comment on the need for the U.S. to cut back on the amounts of money it has been pumping into the economy to rescue it from economic disaster.

The U.S. spent $180.7 billion in July 2009, the most it has ever spent in one month in U.S. history. If the FDIC’s funding is exhausted, the U.S. will go to taxpayers to finance the FDIC’s loan sales and short-term obligations.

In view of France’s experience in establishing a bank and making John Law the owner, the U.S. must be mindful of not repeating France’s history and putting unscrupulous individuals in charge of these banks.

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CIT Rescued by Shareholders

July 21, 2009

Photo by Bluex Image, Courtesy of Stock Exchange

Photo by Bluex Image, Courtesy of Stock Exchange

CIT bank received a pledge of $3 billion from its shareholders to keep it from filing for bankruptcy. It will use $1 billion of it to pay a debt due in August. Although this is a fortunate event, it may still not be enough to keep it the red and the FDIC has indicated it may close the bank down.

The U. S. conference Board has expressed optimism that the economy is showing signs of recovery and this may boost consumer confidence. S & P 500 quarterly earnings are 15% higher than expected.

Across the seas, China has been reporting since March that they are showing signs of recovery as many of the factories are reopening and no more migrant workers are returning home.