Bailout Watch 429: They're Baack
Everyone’s favorite feel-good broadsheet, SubPrime Auto Finance News, reports that 13 members of congress have written a letter to Fed Chairman, Ben Bernanke, and Treasury Secretary, Tim Geithner, requesting another raid on TALF, the Term Asset-Backed Securities Loan Facility. The congressional bagmen “applaud the joint efforts of the Federal Reserve Board and the Department of Treasury to promote liquidity in consumer loan markets through the Term Asset-Backed Securities Loan Facility.” Because making $200B available was an interesting start. “However,” continue the servants of the public trust, “we are concerned that the program may not sufficiently address the problems facing the domestic automobile industry.” Oh dear.
“Unlike many other Federal Reserve facilities which allow any investment grade collateral to be pledged, the TALF program is currently limited to only AAA-rated assets. In light of the uncertainty facing the automobile industry, it appears that the major rating agencies are reluctant to deem any portion of a loan to an auto dealer as AAA. Unfortunately, this means that the domestic auto finance companies are unable to use the TALF program to accommodate dealer floor-plan financing.”
OK, we’re in a crisis caused by poor lending standards. What we need now is for the Fed and the Treasury to step up where our subprime lenders have failed us. News of the demise of the US auto market is overrated. Check please?
“We appreciate Federal Reserve Chairman Bernanke’s recent statement that he is willing to revisit this issue. Given the urgent nature of the crisis in the motor vehicle industries, we encourage you to consider finding a way to ensure adequate financing for dealer floor plans as soon as possible,”
According to SPAFN, this latest masterpiece in the bailout beg/threat oeuvre was signed by Representatives Gary Peters, Thaddeus McCotter, Barney Frank, Paul Kanjorski, Brad Miller, Donald Manzullo, Emmanuel Cleaver, Ron Klein, Mary Jo Kilroy, Joe Donnelly, Andre Carson, Dan Maffei and David Scott.
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Otto: I found something! [pulls a briefcase from the ground] Wiggum: [opens it] It's just a piece of paper. Homer: It's mine! [reads] "Frightfully sorry, but there is no hidden treasure. I have already used this time to escape from your jail. Fondest wishes" -- oh, I can't make out the signature! Quimby: Keep digging. We're bound to find something! They do as Quimby suggests, until there are only a few of them at the bottom of a hole forty or fifty feet deep. Quimby: I guess we're not going to find anything. Otto: Um, how are we going to get out of here? Homer: We'll dig our way out! Wiggum: No, dig _up_, stupid. -- "Homer the Vigilante"
Thad McCotter called the Bailout Bill "American Socialism" on the floor of the House. Thanks for the memories