We have avoided reporting the daily changes and leaks regarding the Geithner bank bailout plan in order to remain sane. It's all noise until they announce it and even then expect changes. It boils down to an apparently difficult choice for Treasury: bondholders versus taxpayers. Bill Gross vs. your family.
Gross would be better served to stop talking his book. He has been right every time except Lehman. Take your positions and then shut up. Stop getting on CNBC and Bloomberg and telling viewers that the taxpayer should absorb these assets. You are transparent. Every one sees it and recognizes your game. And you are losing industry respect with this behaviour.
CNBC won't allow embedding so click the photo to go directly to the video. There is a 2nd video inside from Fast Money today with Steve Liesman offering up the latest on the Geithner plan. And a 3rd video of Gross's most recent appearance on CNBC. Just remember, no matter what you hear tomorrow, whether it is a ring fence. or insurance, or a public-private partnership, or taxpayer bad bank, it all means the same thing. You absorb the losses and Bill Gross and the other bondholders win.
I'm numb to the pain. I see monetization down the road and resignation has set in. The Bloomberg piece detailed the $9.7 trillion in committments we've made so far. The debt will be $20 trillion in 2015. Interest on the debt will be between $800 billion and $1 trillion annually at that point depending on our funding costs. It's all over but the crying. We will not be able to service the debt.
And Santelli, thanks for the good fight.
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Feb 12, 2009 at 9:32 AM
