Tuesday, October 14, 2008

All Your Banks Are Be Long To U.S

Today President Bush and Treasury Secretary Paulson announce a plan to use $250 billion out of the $700 billion bailout bill to buy stocks in American banks.

or to put it simply the government is taking (part) ownership in the banks.

This move is of course done to help fix the troubled economy and countries around the world have taken similar actions.

As big of a change this is for the way we (America) have ran our banking system to give some since of normalcy a large chunk of the money ($125 billion) will go to the largest banks (Citigroup Inc., Goldman Sachs Group Inc., Wells Fargo & Co., JPMorgan Chase & Co., Bank of America Corp., Merrill Lynch & Co., Morgan Stanley, State Street Corp. and Bank of New York Mellon Corp.)

This is keeping with who the FEDS bailed out in the past months.

wow, joking aside I'm really trying to take this all in. I know the ideal of America nationalizing its banks will make some people fell uneasy even if it only in part. But then those people will go into a crazy rant about becoming a communist nation.

Which I doubt will happen in America.

besides the government is only planning on buying 15% of the companies and in 3 years they can buy back their shares.

but this is still a very interesting development.

the Treasury department will be placing limits on executive pay and golden parachutes.

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