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Originally Posted by xoxoxoBruce
Some can't pay the mortgage.
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Some are finally asking damning questions of Paulson. The original $700billion intent was to buy toxic assets and to help restructure mortgages. Well a blank check is still not restructuring mortgages. But now it will be used to enrich $1.8 billion GM with how many tens of $billions?
People are suspecting that Paulson has no idea what he is doing - jumping from fire to fire and never putting any out. Major companies are now purchasing finance companies to also qualify for TARP money.
Simply give $1billion to Telsa Motors. Let them buy a major part of GM and make a car that actually might be profitable. (Obviously not a solution, but it makes more sense.)
Meanwhile, TARP may be sucked into AIG. Having been given $85billion, AIG burned through that. Government next bought $billions in preferred stock as if that would justify more money. Well new obligations mysteriously keep arising in AIG along with new credit obligations. The entire net worth of AIG may only be $27billion - not even enough to cover the governments AIG preferred stock.
Worse, there appears to be no end to AIGs need for more money to save their maybe $1trillion of contracts. AIG keeps finding more obligations that were never known previously on the spread sheets. Another black hole that means TARP may have even less money left to help restructure mortgages.
Be scared. Every week, more mysterious debts suddenly materialize. Debts that previously disappeared with Enron accounting standards. Apparently a 40% stock market drop is not the bottom.