Posted by
rycK on Saturday, February 16, 2008 11:53:02 AM
The New York Times Advises Us on a Debt ‘Bailout,’ Watch Your Pocket Books!
There are many facets to our economic society. There are many snakes and buzzards who circle around and wait for a carcass to present itself about the Tree of Woe. But, there are leftist policy wonks who seek to grab some more power and taxes from any variation, up or down, in the markets. Today, the credit market becomes the new smorgasbord of the left.
In today’s editorial, entitled Hardball With Warren and Eliot,[1] we are treated to the final solution to the credit ‘problem’ that we face.
“States and localities — including New YorkState and New York City — took a hit from the credit crunch this week. And in separate yet complementary ways, the investor Warren Buffett and New York Gov. Eliot Spitzer struck back.”
Rarely do we see the usual foreplay with leftist wordleninizing[2] omitted and get down to the nitties and the gritties as we see today.
The ultimatum stated:
“With major bond insurers hobbled by an ill-advised foray into subprime mortgage territory, Mr. Buffett made a tough offer aimed at the biggest and healthiest chunk of their ailing business. The insurers either turned Mr. Buffett down or haven’t responded, which puts the onus on them to devise their own rescue plan. Mr. Spitzer on Thursday gave the insurers five more days to do just that. If they fail, they face a potential breakup by New YorkState’s insurance regulator.”
The reason they are so frantic?
“In the past week, hundreds of routine Wall Street auctions failed to attract enough buyers for debt securities issued by states, hospitals, cultural institutions, student loan authorities and port authorities, among them the Port Authority of New York and New Jersey.”
Is it because their credit ratings are in the latrines or soon will be?
“Investors were not worried about the creditworthiness of the issuers, but about the reliability of the bond insurers that guarantee payment in the event of default.”
We must notice the esoteric use of the terms “in the event of default” here. There is no question that California, [3] New Jersey [4], Michigan and probably New York will default on their municipal loans and such and that these states ‘leaders,’ such as Spitzer, who favors driver’s’ licenses for illegal aliens, want some sucker to pay the price for their advanced socialism.
“The [debt] auction failures, in turn, have forced the issuers to pay sharply higher rates on their borrowings. The situation could get considerably worse if the other insurers have their credit ratings downgraded.”
Why, we wonder, should the credit ratings of deadbeats not be downgraded?? The California Adventure is an essay in financial madness as we all can see. Those who are adept in financials associated with CA must flee if they have not done so as yet. Warren Buffet’s grand entrance into this mess as a White Knight signals the fact that these debt securities will go down to default and that the states will have to issue more paper in light of their excessive spending on phony social programs at higher interest rates.
“Even worse, a downgrade of the insurers would likely raise the cost of borrowing for states and municipalities because they rely on insurance to raise their securities’ appeal.”
Repeating the fear does not change the outcome.
The solution:
“For several weeks, the New York State insurance superintendent, Eric Dinallo, has tried to persuade insurers, their major shareholders, banks and other government officials and industry players to come up with a rescue plan, say, by getting the banks to bail out the insurers in exchange for stakes in the companies.”
Ho! How nice! Let the morally and financially bankrupt states and their phony social agencies just tap into common stocks of the banks and their associated holdings to guarantee that the states can continue on with buying voters and coddling criminals as long as they can. The evil corporations can pay for the drug rehab programs, Madras-styles schools and welfare payments for illegal aliens.
And the final blame is placed:
“The pressure Mr. Spitzer has applied is needed. For its part, the Bush administration’s main approach to the subprime mess — to merely cajole the private sector to act in the public interest — is not working.”
And, there you have it. The private sector must bail out the bankrupt cities and states.
What else could the New York Times come up with? Cut spending? NO. Cancellation of phony social programs? NO. Using effective spending measures in spite of the unions? NO.
The usual solution to such problems outlined by the New York Times is to raise taxes.[5] [6] [7] [8] [9]
WHY NOT JUST RAISE TAXES? WE CAN HIKE TAXES IN NY, CA, NJ AND OTHER PLACES TO HIGHER AND HIGHER LEVELS OF PROSPERITY.
If you raise taxes high enough you do not have to barrow!!
Get out of NY, CA, and NJ fast.
ryck
comments: ryckki@gmail.com
[2] New word defined as writing in a cryptic manner to disguise the Marxist-Leninist theory and substance behind the theme.