Chorus grows: Nationalize the banks

[RedEarth]

The new U.S. Treasury secretary, Timothy Geithner, has been in office for all of - what? - two weeks? He is charged with fixing the most terrifying financial crisis in nearly 80 years. He is under intense pressure to do something big - and to do it fast.

......

Arbess added: "You've got a situation here that has been in the making for decades. Everybody knows it is complex. It's not going to be resolved in two weeks." Point well taken.

......

The truth is, solving a financial crisis amounts to a kind of sophisticated, high-stakes guessing game. Every proposed solution also has the potential to backfire. As the bank chieftains who testified before Congress said repeatedly Wednesday - when they weren't either groveling or listening stoically to congressional scoldings - reigniting the banking system has to start with re-establishing confidence.

......

As I polled my Talking Business kitchen cabinet this week, gauging reaction to the Treasury secretary's plan, I kept hearing the same refrain.

"We've got to get on with it," said Christopher Whalen, the respected bank analyst who publishes the Institutional Risk Analyst newsletter.

"We need to take over the banks," said Joshua Rosner, a managing director of the research firm Graham-Fisher.

"When I talk to experts, after about two minutes they say, 'We should just nationalize,"' said Simon Johnson, a banking expert at the Sloan School of Business at the Massachusetts Institute of Technology. "That tells me that the consensus is moving in this direction, and we are all just afraid to say it."

http://www.iht.com/articles/2009/02/13/business/wbjoe14.php

[Warpy]

1. People who know what they're talking about

are generally saying "nationalize." It's just going to be a really tough sell to a Congress who knows its constituents are phobic about socialism.

However, throwing money at the asset columns and driving this country into so much debt that the IMF will have to step in is even worse.

Nationalizing them will allow them to stay open and functional while they rebuild those asset columns enough that they can move back into the private sphere.

The Fed, Fannie Mae and Freddie Mac need to remain nationalized and under very strict oversight.

[dkf]

2. When Lindsey Graham joins the "nationalize" chorus I'm wondering

what we are saddling ourselves with.

[PM Martin]

3. I understand how Americans feel about this.

It is though, the only choice that is viable.
If money is being given to these banks without strict oversight, the bankers will take the money and run.

[Demeter]

4. Because It's the Correct Thing to Do

Under our laws, under good accounting practice, under moral guidelines, as fiduciary trustees for the American people, the government has no other options than to nationalize the failed banks, no matter what size they may be, or who happens to own the stock.

Plus, it will work. It will accomplish both economic cauterization and social leveling. It will enable us to start reconstructing the social contract, the economic system, and the American Dream.

I predict--between two weeks and two months, and it will be fait acompli.

[Skink]

5. They probably should have sat on the retention thing for awhile.

[MasonJar]

6. Geithner (sp?) does not seem to be the type to do that. He was one of

the instigators of the Paulsen debacle. I cannot imagine why Obama chose him. The gentleman (Dr. Johnson) on Bill Moyers had a sound idea. Look at the video if you missed the Friday show.

[Diclotican]

7. RedEarth

RedEarth

In the 1990s, when Norway got the flue from economic meltdown, all the banks was nationalized, more or less, and it worked well here in Norway - and by the way, for all of you who are scared to death about "communism" with nationalized Banks, all the Banks are today more or less privatized, with just a small share been owned by the State

This because in a small country like Norway, if a bank got bunked out and down, it would be more or less a catastrophe, not just for they who have money in the bank, but also because of the impact it would have for the whole finance in the country.. And in the 1990s the economy in Norway was really in bad shape, but a strict policy, and hard work, where the Banks get money - with condition who had to be meet before they ever had to dream of privatized again it worked.. And now, the economy is in better shape than it are in many other nations in this world.. Not that we haven't been hurt by the crisis, but compared to many others, we are in better shape.. And our minister of Treasury who are from the left-wing SV, have more money in the bank, than most country thank to our black gold in the North Sea... Just thinking if FRP, (right wing party) who in 1976 was seriously talking about selling all right to the oil fields to an american company for the sum of one billion dollar.... We Had, as of 2005 1016 milliarder kroner in SURPLUS to our working... And I would guess that it have been more money in the bank since 2005..

That I am saying here, nationalize the bank system, to help them to recover, are not the same as been communist.. Rather it is sane when the economy is plumbing down the drain, and millions are left without nothing to have.. And it is ALSO a way to be dam sure that no one is just stealing the stimulants package blind - as I am afraid is happening today in the United States... I am afraid that most of the billions spend Will never get to them who need it, but rather to off shore banks where the owners would have washed them clean before most people ever know it happend...

And in the end, this nationalize of the banks, to get the economy going again, is what US need, because I really do not believe for a moment, the current economical ideology would made US anymore better than it was in 2008 or in 2007.. In fact I fear that if the FEDERAL GOVERNMENT are not doing something, like nationalize, the whole system can just came down the roof.. TO hit everyone who haven't a big bank account in Cayman Island and other "heavens" for the really rich...

In this crisis the US, and many other nations are in, ideology have to go, and we have all to be pragmatic to what to do next. If the Republican's doesn't want to play ball to help US get on their feet again.. Then just let them rot in hell..

And in worse of cases. the IMF _will_ came in and tell the United States of America to do what they have been told the poor country's for the last 60 year. And we know how successfully it was in Latin-America,Africa and in Asia?..

Diclotican

Sorry my bad english, not my native language.