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  • Massive new Gosbank USA formed, market soars

    Massive new Gosbank USA formed, market soars

    Today the GSEs Fannie Mae and Freddie Mac merged with the Federal Reserve Bank, the US Treasury Department, Goldman Sachs, Citigroup and JP Morgan Chase to form Gosbank USA. The DJIA soared 280 points on the news

    Capping a year of crisis in the credit markets and global financial system that led to the nationalization of banks in Europe and England, the US today consolidated and merged ownership of the nation’s largest banks under co-chairmen former Federal Reserve Chairman Ben Bernanke and former Treasury Secretary and ex-head of investment banking giant Goldman Sachs Henry Paulson. “We made lemons out of lemon-aid and turned a terrible crisis for the US economy and the American people into a golden opportunity to expand the power and reach of the State,” said Paulson in a speech made today from the new headquarters of Gosbank USA on Wall Street, the new administrative center for several recently created US government planning authorities, including Gosfin USA, the State Central Financial Regulatory Authority, and Gosrec USA, the State Central Housing Reconstruction Authority.

    The new bank gets its name from the Soviet era Gosbank.
    Gosbank (Gosudarstvenny bank SSSR—the USSR State Bank) was the central bank of the Soviet Union and the only bank whatsoever in the entire Union from the 1930s until the year 1987. Gosbank was one of the three Soviet economic authorities, the other two being "Gosplan" (the State Planning Committee) and "Gossnab," the State Committee for Material Technical Supply.

    The Soviet state used
    Gosbank primarily as a tool to impose centralized control upon industry in general, using bank balances and transaction histories to monitor the activity of individual concerns and their compliance with Plans and directives. Gosbank did not act as a commercial bank in regard to the profit motive. It acted, theoretically, as an instrument of government policy. Instead of independently and impartially assessing the creditworthiness of the borrower, Gosbank provided loan funds to favored individuals, groups and industries as directed by the central government. - WikiPedia: Gosbank
    One of the first initiatives for the new bank is to restructure loans made to borrowers during the housing bubble to extend the payment periods from 30 to 100 years under a new federal government loan program called "Debt for Life."

    “We’re reading your email, you work for a company that manufactures weapons or other goods for the government or you will soon enough, and now we’re managing your investments and loaning you the money you need to eat and put a roof over your head. You work in our companies and you live in our houses. It just doesn’t get any better than this,” remarked Paulson.

    President Bush applauded the formation of the new bank as key to restoring confidence in financial markets.

    (Hat tip to iTuliper krakknisse for the pointer to Gosbank.)

    AntiSpin: Actually, this is a reprint of our April Fool's posting this year: Massive new Gosbank USA formed, market soars
    . Hey, what can we say? We had a "feeling" this was going to happen, and we were only off on the stock price by 10 points – 290 vs 280 – but give us a break; the forecast was over five months ago. If you think we're kidding about the rest of it, read it again.

    Here's what Jim Rogers has to say about it.





    See also:
    iTulip interview with Jim Rogers (2006)
    iTulip interview with Jim Rogers (2007)

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    Last edited by FRED; 09-08-08, 11:06 PM.
    Ed.

  • #2
    Re: Massive new Gosbank USA formed, market soars

    Originally posted by FRED View Post

    AntiSpin: Actually, this is a reprint of our April Fool's posting this year: Massive new Gosbank USA formed, market soars
    . Hey, what can we say? We had a "feeling" this was going to happen, and we were only off on the stock price by 10 points 290 vs 280 but give us a break; the forecast was over five months ago. If you think we're kidding about the rest of it, read it again.
    ok, will give you points for guessing that the gov't was gonna take over phonie and fraudie. more points for guessing the stock market spike on the news. but the 280 vs 290? pure luck. just like the gold 780 bottom call :cool:

    if this isn't luck you are making big trades not running a web site, are you :p

    Comment


    • #3
      Re: Massive new Gosbank USA formed, market soars

      In Mexico, when banks were nationalized, they weren't merged immediately. The process took several years. This case doesn't seem to be different. A thorough audit has to take place so the new owners see how deep the sink hole is and how they will have to cover it.

      Difference is that Mexican banks were capitalized back then, the one that had no money was the Government.

      In 1994 the banks were the ones without money, so the Fobaproa reestructuration was what trespassed debt to Mexican People. As debts have been paid, the Fobaproa induced debt has been reduced, let me check the numbers, but I don't think the reduction is beyond the inflation or interests, so that nominally it all still has not diminished.
      sigpic
      Attention: Electronics Engineer Learning Economics.

      Comment


      • #4
        Comedians and cartoonists have long noted that reality is becoming absurd at such a rapid pace that it is difficult for satire to keep up anymore.

        An economic blog I like to read, "The Cunning Realist", says that Lehman Brothers is suddenly looking like the next good candidate for a sweet, juicy bailout. Any comments?
        One of the reasons I like The Cunning Realist is that, like much of the stuff I read here on iTulip, his prose cuts straight to the heart of the matter in a memorable way. For example, discussing the Fannie/Freddie bailout, he says:
        The unstated message of these bailouts and interventions is as damaging as it is clear: participate in the next bubble. ... You're prudent at your own risk, because when the bubble pops you'll be forced to participate whether you like it or not. If people really understood what was going on here -- essentially a system of "soft slavery" in which an ever-increasing amount of one's daily labor subsidizes Wall Street and the speculator class via inflation and the socialization of risk -- they'd be in the street. Of course very few do understand it, which is what policymakers count on.


        Also meant to send this out awhile back... Did I post this here already?
        "Alan Greenspan has presided over more hundred-year events in the last 20 years than most of us do in a lifetime... What doesn't seem to have dawned on Greenspan or those who interview him is the thread that connects all these disparate events: Greenspan himself. "
        Last edited by necron99; 09-10-08, 09:51 PM. Reason: Added Quote

        Comment


        • #5
          Re: Massive new Gosbank USA formed, market soars

          Necron99 -

          I think you need to post another excerpt from your lugubriously depressive novella about our collective future here, so we can all feel better about our present day reality which is supposedly a paradise in comparison. I need to read some more about the hapless jerk with a ball and chain around his ankle, working three jobs and stuffing envelopes on weekends to pay the electric bill, while sacrificing his vacation time at all three jobs just so his employers won't fire him.

          Comment


          • #6
            Re: Massive new Gosbank USA formed, market soars

            Originally posted by Lukester View Post
            I think you need to post another excerpt from your lugubriously depressive novella about our collective future here, so we can all feel better about our present day reality which is supposedly a paradise in comparison. I need to read some more about the hapless jerk with a ball and chain around his ankle, working three jobs and stuffing envelopes on weekends to pay the electric bill, while sacrificing his vacation time at all three jobs just so his employers won't fire him.
            Your wish is my command, Lukester!

            I wrote that story in 1995 and attempted to imagine severe inflation in the year 2017. Did I fall short of the mark, ya think?

            Loud indistinct voices clashed angrily from behind the closed conference room door near the RatScan company lobby. But Tony kept walking tiptoe anyway, with those damn crinkling bags. Bad enough that he had to waste the precious lunch hour between his two jobs, shopping on a Saturday when it was the most crowded. But it had to be done today or wait til Thursday, his day off from ConTek. Damned if he was gonna boil that last egg at home, unless he had ketchup to go with it.!
            The toast and maybe an instant soup...What else had he bought? Had he even checked the sweepstakes on the receipt?
            That was the one thought that could break through the residual panic left-over from his tardy entrance. If hed won anything, and hurried right back, maybe the clerk would recognize him and let him claim his prize! Eyes crusty with fatigue, he groped for the small piece of paper buried among the cereal and processed cheese.


            THANK YOU FOR SHOPPING QUEEZEE-MART [TM]
            15:57:48 SATURDAY, JULY 29, 2017
            CLERK #: 1138 (F.J. DINWIDDLE)

            MILKLOFAT1/2GAL $ 16.75
            SNEEZCHEEZ8oz $ 11.32
            COUPON $- 0.50
            OOZINGNOODLE 16@5.75 = $ 92.00
            HONYBLSTCEREAL $ 28.39
            DEHYDRATOAST $ 32.74
            STIMUSODA1/2CASE $ 37.25
            TRKYTRIPESALAMI $ 83.94
            OATBRANYOGHRT 4@ 8.95=$ 35.80
            INSTAKETCHUP8oz $ 12.95
            SUBTOTAL $350.64
            TAX @0.155 $ 54.35
            TOTAL $404.99
            -DEBIT CARD $404.99

            SORRY! YOU WERE NOT A WINNER THIS TIME.
            PLEASE COME AGAIN & PLAY
            QUEEZEE-MART [TM]S ALL-YOU-CAN-SCARF SWEEPSTAKES!!
            [Sorry, for some reason I can't get the dollar amounts to line up with tabs or spaces when I post it on this forum. It looks more like a grocery-store receipt in the original story, Adobe PDF.]
            As the helpful staff at iTulip has explained, we all pay for these bailouts via inflation. So, if these bailouts keep continuing for a few years? Examine the receipt above.

            --------------------

            Another comment: this next quote is not my writing.

            But I liked this analysis from IOZ:

            You have to understand that the US Federal government now effectively controls one half of the mortgages in America. When you hear the pinheads on "Marketplace" yapping about the fine distinction between conservatorship and receivership, you can safely disregard that pish as serious posh. The government owns your houses, dudes and dudettes, and you're paying them for the privilege of living there. Consider this: although effectively nationalized, you're still paying interest. There's this word that starts with an S and rhymes with Nerf, but it escapes me at the moment. This in any case has all occured under a supposedly conservative administration. George W. Bush: biggest socialist in America. I love this land.

            Comment


            • #7
              Re: Massive new Gosbank USA formed, market soars

              TRKYTRIPESALAMI $ 83.94




              Brilliant stuff Necron99. Very prescient. Very funny too, in a horrific sort of way.

              Comment

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