In a complex set of arrangements, the federal government has stepped in to stabilize the credit union industry, as reported by the Wall Street Journal. The bailout involves wholesale credit unions. They invest money for retail credit unions and provide them with check-clearing services.

During the housing bubble, these wholesale credit unions invested in subprime mortgages, and guess what? They lost a bundle of money for their clients, who are retail credit unions.

Continue reading A Bailout for Credit Unions

A Bailout for Credit Unions originally appeared on BloggingStocks on Mon, 27 Sep 2010 11:30:00 EST. Please see our terms for use of feeds.

Financial guru, Nouriel Roubini foresees rising sovereign debt leading to defaults.

Roubini predicted the U.S. financial collapse at least a year before it happened. Now he is predicting sovereign defaults for European Union (EU) nations.

Continue reading Roubini: Rising Sovereign Debt Will Lead to Defaults

Roubini: Rising Sovereign Debt Will Lead to Defaults originally appeared on BloggingStocks on Sun, 02 May 2010 15:40:00 EST. Please see our terms for use of feeds.

The federal budget year ended in October. The October deficit number set a record of $176.4 billion, which was higher than the $150 billion economists had predicted.

For the budget year 2009, the deficit reached $1.42 trillion. That too was an all-time record. This year's deficit was $958 billion above the 2008 deficit. October was the 13th straight month to show a deficit.

Continue reading Federal deficit sets October record of $176.4 billion

Federal deficit sets October record of $176.4 billion originally appeared on BloggingStocks on Fri, 13 Nov 2009 12:20:00 EST. Please see our terms for use of feeds.

Over the past decade we seen at least $1 trillion dollars spent by private equity firms. These firms have taken over companies for a pittance and then pillaged them by slashing employees and cutting costs. They then used the money to pay down debt rather than rebuilding the company.

Now all of the debt thrown on the acquired companies is coming due and it could cause another economic disaster, even bring down the economy.

Continue reading Will private equity take down the economy?

Will private equity take down the economy? originally appeared on BloggingStocks on Tue, 03 Nov 2009 13:30:00 EST. Please see our terms for use of feeds.

CIT Group

Continue reading Taxpayers are, once again, the biggest losers in the CIT bankruptcy

Taxpayers are, once again, the biggest losers in the CIT bankruptcy originally appeared on BloggingStocks on Mon, 02 Nov 2009 11:00:00 EST. Please see our terms for use of feeds.

In the past, the government has increased spending and cut taxes to spur spending during times of economic crisis.

However, Uncle Sam is now in so much debt that this is no longer a serious option. And it looks like we are going to spend another $900 billion-plus on health care reform over 10 years (a lot of money, sure, but about a third less than what Wall Street will spend on bonuses).

Continue reading Reason #8: Uncle Sam can't bail us out

Reason #8: Uncle Sam can't bail us out originally appeared on BloggingStocks on Sun, 25 Oct 2009 11:00:00 EST. Please see our terms for use of feeds.

There's a new day dawning out there. Some analysts are proposing that bankers should be paid in toxic assets. Among the chief proponents of this idea are Vince Farrell of Soleil Securities and Jim Rodgers of Rodgers Holdings.

Now this seems to be a fine idea. The bankers, with their greed and excess speculation, took down our financial system. The U.S. Treasury and the Federal Reserve had to pledge $12.2 trillion of your money to bail out these ... (you finish the sentence as you see fit). Can you imagine what $12.2 trillion is like? Do you have any idea what this money could have done for our country?

Continue reading What if bankers were paid in toxic assets?

What if bankers were paid in toxic assets? originally appeared on BloggingStocks on Mon, 14 Sep 2009 15:40:00 EST. Please see our terms for use of feeds.

The Congressional Oversight Panel reported on Wednesday that most of the $23 billion in taxpayer funds provided to General Motors and Chrysler is unlikely to be repaid. The Congressional Budget Office estimated in June that taxpayers would lose $40 billion of the first $55 billion provided to the auto industry.

The Treasury Department acknowledges that most of the $23 billion provided by the Bush Administration is likely gone forever, but added that there is a "reasonably high probability of the return of most or all of the government funding" provided by the Obama administration.

Continue reading GM insists it will repay taxpayer funds -- oh, really?

GM insists it will repay taxpayer funds -- oh, really? originally appeared on BloggingStocks on Thu, 10 Sep 2009 12:50:00 EST. Please see our terms for use of feeds.

Bailout coverage has taken on a celebratory tone in recent days as a slew of banks including Goldman Sachs (NYSE: GS) have repaid TARP money, leaving taxpayers with what looks like a handy profit. In addition, equity stakes in Citigroup (NYSE: C) and Bank of America (NYSE: BAC) are sitting on a handsome paper profit.

The only problem is that hundreds of banks have received TARP money. Of course, the most healthy ones are paying it back quickly. The rest are still in limbo, and the result is that the Treasury Department is realizing plenty of gains while all the losses -- investments in companies like American International Group (NYSE: AIG), General Motors, and Chrysler -- remain unrealized and largely ignored.

Continue reading Are the bailouts making taxpayers rich? Not so fast

Are the bailouts making taxpayers rich? Not so fast originally appeared on BloggingStocks on Wed, 02 Sep 2009 12:20:00 EST. Please see our terms for use of feeds.

August 25, 2009. Ben Bernanke is nominated to serve a second term as Federal Reserve Chairman.

August 25, 2009. Ben Bernanke and the Fed are ordered by a federal court to disclose details of their bailout transactions during the financial meltdown last year.

Two reporters from Bloomberg News filed suit in federal court under the Freedom of Information Act and won a case that "ruled against the U.S. Federal Reserve's attempt to block disclosure of companies that participated in and securities covered by a series of emergency financial programs as the global credit crisis began to intensify."

Continue reading Federal court order forces Fed to release details of $2 trillion dollar bailouts

Federal court order forces Fed to release details of $2 trillion dollar bailouts originally appeared on BloggingStocks on Wed, 26 Aug 2009 12:00:00 EST. Please see our terms for use of feeds.

Continue reading Bailed out businesses slash lobbying budgets

Bailed out businesses slash lobbying budgets originally appeared on BloggingStocks on Thu, 13 Aug 2009 17:40:00 EST. Please see our terms for use of feeds.

What happened to the economy in the second quarter? While the numbers show that the contraction in GDP was only 1%, it nevertheless was a negative number.

Here is a breakdown of some key numbers:

• GDP fell 1% in the second quarter after falling 6.4% in the previous quarter.
• Residential investment fell 29.3%, after falling 39.2% in the first quarter.
• Business investment dropped 8.9% after a slide of 39.2% in the first quarter.

Continue reading GDP falls 1% in second quarter -- where is the growth?

GDP falls 1% in second quarter -- where is the growth? originally appeared on BloggingStocks on Sat, 01 Aug 2009 12:30:00 EST. Please see our terms for use of feeds.

Continue reading Bailouts could cost taxpayers $23.7 trillion?

Bailouts could cost taxpayers $23.7 trillion? originally appeared on BloggingStocks on Mon, 20 Jul 2009 15:40:00 EST. Please see our terms for use of feeds.

With all the bailout money circulating through the system, the U.S. government is fundamentally altering notions of competition. Mainly, companies that are receiving bailout funds are finding themselves with a distinct competitive advantage.

The Wall Street Journal (subscription required) reports that "Since the onset of the financial crisis nine months ago, the government has become the nation's biggest mortgage lender, guaranteed nearly $3 trillion in money-market mutual-fund assets, commandeered and restructured two car companies, taken equity stakes in nearly 600 banks, lent more than $300 billion to blue-chip companies, supported the life-insurance industry and become a credit source for buyers of cars, tractors and even weapons for hunting ... Increasingly, companies big and small are competing on the basis of their ability to tap government money."

Continue reading The oligarchy of bailouts, and why we all lose

The oligarchy of bailouts, and why we all lose originally appeared on BloggingStocks on Mon, 15 Jun 2009 13:20:00 EST. Please see our terms for use of feeds.

Continue reading Can I claim AIG as a dependent?

Can I claim AIG as a dependent? originally appeared on BloggingStocks on Mon, 30 Mar 2009 17:00:00 EST. Please see our terms for use of feeds.

Continue reading GM's UAW buyouts not that different from AIG bonuses

GM's UAW buyouts not that different from AIG bonuses originally appeared on BloggingStocks on Thu, 26 Mar 2009 10:10:00 EST. Please see our terms for use of feeds.

I've recently been giving some thought to how we can help Detroit get out of its rut.

And what a rut it is: The average home price is hovering around $6,000 and vacancy rates are soaring as everyone who can find somewhere else to go flees Detroit. I suggested making Detroit into a retirement community, but now I have a better idea: Make AIG (NYSE: AIG), Bank of America (NYSE: BAC), and Citigroup (NYSE: C) executives have their little conventions there.

Continue reading Make bailed out companies hold meetings in Detroit!

Make bailed out companies hold meetings in Detroit! originally appeared on BloggingStocks on Sun, 22 Mar 2009 15:40:00 EST. Please see our terms for use of feeds.

Continue reading Rick Santelli blasts AIG bonuses, bailout

Rick Santelli blasts AIG bonuses, bailout originally appeared on BloggingStocks on Wed, 18 Mar 2009 11:35:00 EST. Please see our terms for use of feeds.

"Close them down, get them out of business. If they're dead, they ought to be buried," he said on ABC's "This Week" program. "We bury the small banks. We've got to bury some big ones and send a strong message to the market."

Continue reading Senator Shelby says we should let big banks fail

Senator Shelby says we should let big banks fail originally appeared on BloggingStocks on Mon, 09 Mar 2009 13:50:00 EST. Please see our terms for use of feeds.

Electrolux CEO Hans Straberg is taking a hard line against bailouts, telling CNBC that failing companies should not receive any more help from governments around the world.

"Let the businesses that are not fully functional, let the weaklings go in this, don't prop them up," he said. "I understand it's difficult to distinguish sometimes between good or bad businesses, but make sure that those who are not surviving the winter don't survive and instead focus on those who have the strength to grow bigger and stronger internationally."

Continue reading Electrolux CEO bashes bailouts

Electrolux CEO bashes bailouts originally appeared on BloggingStocks on Sun, 08 Mar 2009 17:10:00 EST. Please see our terms for use of feeds.