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Sunday evening (March 22), President Obama uttered some intelligent words: Wall Street was overpaid, he said, noting that 25 years ago, Wall Streeters made 20 times what teachers make, and now it's 200 times (an understatement, but who's counting?Then the administration laid out its plans for getting rid of trillions of dollars of toxic assets held by banks. (One way is to change the name from "toxic" assets to "legacy" assets, but that's another story.) The administration bragged, falsely, that private sector participants such as hedge funds and private equity groups would take risk when they bought such assets. Nope. Because of the government's non-recourse loans, private sector investors would pick up only 15 percent of the risk. The stock market roared upward today; one analyst called it a "free money rally." Amen. But here's the blackmail: as soon as Treasury Secretary Geithner revealed the program, Wall Street firms said they wouldn't participate unless the government guaranteed that it would not set compensation limits on the firms. That is, the Wall Street moguls want to continue making $50 million to $1 billion a year. Geithner capitulated today and said any participants in the program would not be subject to pay limits, unless they were already subject to such limitations as recipients of TARP funds .But how many participants of TARP funds would be buying others' toxic assets anyway? They're trying to get rid of their own. Bottom line, the private sector participants in this program take no risk with the money they put up, and can keep bringing home obscene pay. Hopefully, there will be a populist outrage to this deal that dwarfs the indignation over A.I.G. bonuses.

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Comments

SurfPuppy619 March 23, 2009 @ 3:15 p.m.

Like I said in another post, the taxpaying middle class public has had just about as much as they can take of this welfare for the wealthy at the expense of the middle class and poor.

If Treasury keep this BS up much longer there is going to be social unrest.

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Don Bauder March 23, 2009 @ 6:39 p.m.

Response to post #1: Well, you are the only one who has responded to this post. I haven't seen any stories about outrage aimed at Geithner's ridiculous handouts -- and promise that no one will criticize outrageous pay. Best, Don Bauder

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JulieParrots March 24, 2009 @ 2:04 a.m.

I agree with you SurfPuppy619, there will be social unrest. A seperation from both sides of the aisle I think. People that don't want the Left or the Right in cotrol anymore. People like Glenn Beck are talking about how pissed taxpayers are on his show. Also "Tea Parties" are starting to spring up all over major U.S. cities.

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Don Bauder March 24, 2009 @ 7:06 a.m.

Response to post #3: Social unrest SHOULD spread for the good of our society. It is completely out of whack. Wealth and income are distributed in a destabilizing way; entirely too much of both is concentrated at the top. This money flows to the politicians of both parties, who are bought and paid for. The U.S. has stark similarities with Third World countries run by the superrich. Finally, the American public is beginning to figure it out. We need people to storm the Bastille. Best, Don Bauder

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JulieParrots March 24, 2009 @ 9:25 a.m.

The bad part is the fact that even after major scandals like Enron, et,al. Major financial institutions on Wall St. still continued to go about business as usual scamming millions of dollars, and gambling away.

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Don Bauder March 24, 2009 @ 9:56 a.m.

Response to post #5: You are correct. The public hasn't wised up yet. I thought yesterday's Geithner scam, as enumerated above, would arouse public wrath, but it hasn't. Wall Street, which drove the global economy to the brink, is being double-bribed to participate in Geithner's program to take toxic assets of banks' books. First, participants have no risk in buying those assets. Second, Geithner has promised that Washington won't go after participants for their obscene compensation. Best, Don Bauder

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SurfPuppy619 March 24, 2009 @ 12:14 p.m.

I haven't seen any stories about outrage aimed at Geithner's ridiculous handouts -- and promise that no one will criticize outrageous pay.

Lou Dobbs and his followers, which I count myself as one, have been outraged about not only the bonuses but also the massive bailoutsd and lack of review given them in the Congress, and that comes across loud and clear on just about every show he has done the last month. He definitely has the pulse of America at his hand.

Greta Van Sustren has also been doing a large percentage of her shows on this social outrage-including doing a show from right in front of the New York AIG building last week, when word came down that the bonuses were going to be paid.

People are pissed off bigtime.

So I am fairly confident that the social outrage is real, it is large and it is wide spread.

If things get worse instead of better who knows what will happen.

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Don Bauder March 24, 2009 @ 2:20 p.m.

Response to post #7: There is no doubt that the outrage is real over the AIG bonuses and the bailouts in general. I was saying I didn't see outrage about Geithner telling those who participate in the toxic asset purchase program that their topside pay won't be scrutinized. Best, Don Bauder

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