Quote:
Originally Posted by xenigo
Dude that's not the example I'm talking about. Obviously if it was Apple stock you owned, the funds would be with Apple.
Banks over-extended themselves with subprime mortgages. You think people who bank with those institutions should just forfeit their funds, because the banks can't afford to let you withdraw your money?
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Well .. first.. BANKS sold sub-prime mortgages based on congress telling them to do so - which started back in the mid 90's. Fannie and Freddie went arround BUYING UP all that garbage debt. The leveraged it to buy more. Then did more of the same in order to over-value the assets of the sudo-government agencies/companies - and then paying themsleves massive amounts of money based on the size of the asset growth - that was over leveraged and overflowing with sub prime mortgages.
LEHMAN joined in the fun and did the same. AIG insurred all those mortgages (Primary Mortgage Insurance) and thus is on the hook for all that sub-prime garbage as it defaults.
As for the 'buy-out' - well, its going to be somewehere between $500-700billion! That much additional debt to you and me will DILUTE the dollar and further devalue it. Thus, there will be added price inflation to everything Americans need and use everyday.
So, we all get higher taxes, less buying power and generally bent over yet again!