[Zardoz]

The charade will go on. We'll all nod and wink at each other, heave a big sigh of relief, and go about our business as usual. Sure, many jobs will be lost, much more wealth will be destroyed, and many more people will lose everything they have as their properties are foreclosed on.

But the game will continue. The fat lady has yet to sing.

Prediction: By Halloween or so, the Dow Jones Industrial Average will have gone over 13,000 at least once. We may see a 500-point jump today. Everybody's buying into Hank & Ben's Bailout Plan. Everybody's on board. Why wouldn't they be? What other choice do they have?

Did we actually think they wouldn't come up with some sort of stunt to pull themselves out of this mess-of-biblical-proportions they've created? Did we actually think a system of smoke and mirrors couldn't be sustained by a clever re-arranging of the mirrors and an infusion of even more smoke?

Sorry to disappoint you, all you fast-crashers, but it ain't gonna happen quite yet. When the oil begins to run out, that'll be another story. You don't sit at a keyboard and create more Black Gold. Bide your time. It'll come. You'll eventually have a use for your bunkers, but for now, our current domiciles will be all we'll need.

Everybody back to sleep.

[Heineken]

Zardoz is clearly right. I've given up on my doom hopes for now.

What some of us have overlooked is that the means to resolve this crisis are in the same hands that created it. The copper-electroplated zinc coin has two sides, but it's the same coin.

The Monopoly game goes on. The banker just needed more play money from the printer, and now it's arrived.

[sjn]

Are you sure this isn't the crash? What made you think the equity markets would crash downwards?

[Carlhole]

This bailout should weaken the dollar again, right? That means oil rallies and energy stocks have hit a bottom.

This whole experience is tailor-made for Ron Paul. If he doesn't come out with a totall explanatory video or something, he's just not trying.

I just listened to Paulson explain the "root cause" of the US financial system. But he only talked about symptoms!

[UncoveringTruths]

When oil rises back to striking distance of $150 we'll be back to square one. I say this buys us a year or so.

[Cynus]

I know that people laugh when you say to call your Congressman and Senator and tell them to oppose the bailout, but it does actually work if enough people do it. The immigration bill is an example where the phones were deluged with calls which caused the bill to fail. It only takes a second and can't hurt.

[Arsenal]

This market jump makes me feel even worse. Even though I am a doomer I wasn't sold on the fast crash scenario but this is scaring the crap out of me. At least with a crash in the stock market the economy slows and something can be built out of the ashes. Now instead it feels like TPTB have hit the NO2 while still heading for the brick wall. Didn't the market have its highest gains on record right before the crash back in the 30's?

Ugh.

Arsenal

[The_Virginian]

$this->bbcode_second_pass_quote('UncoveringTruths', 'W')hen oil rises back to striking distance of $150 we'll be back to square one. I say this buys us a year or so.

[firestarter]

You're wrong, Zardoz. After the euphoria wears off today, we are set up for the biggest crash in modern times. Yes I said it. Biggest!

Now that they won't have short covering rallies to gin the market we'll crash once traders wrap their heads around the fact that the opaque securities the govt is going to purchase from banks that will actually accelerate bank failures, not make them healthier. Mark to market is coming out of this plan, and it's going to torpedo the market, period.

The govt is not going to pay more than pennies on the dollar for these illiquid assets. They'll have their Super Govt SIV alright, while at the same time emasculating the very folks they set out to save. If anything the banks won't sell em to the govt at all, preferring to keep them hid indefinitely instead. If govt paid mark to model then it would cost several trillion bucks. Ain't gonna happen. Crash commences once figured out, which won't be long.

[sjn]

$this->bbcode_second_pass_quote('firestarter', 'Y')ou're wrong, Zardoz. After the euphoria wears off today, we are set up for the biggest crash in modern times. Yes I said it. Biggest!

Now that they won't have short covering rallies to gin the market we'll crash once traders wrap their heads around the fact that the opaque securities the govt is going to purchase from banks that will actually accelerate bank failures, not make them healthier. Mark to market is coming out of this plan, and it's going to torpedo the market, period.

The govt is not going to pay more than pennies on the dollar for these illiquid assets. They'll have their Super Govt SIV alright, while at the same time emasculating the very folks they set out to save. If anything the banks won't sell em to the govt at all, preferring to keep them hid indefinitely instead. If govt paid mark to model then it would cost several trillion bucks. Ain't gonna happen. Crash commences once figured out, which won't be long.

[Prince]

For the life of me I still don't understand why people don't see this for what it is. When AIG was bailed out two days ago, people panicked because they said this wouldn't work, since the core problem doesn't go away.

Now we hear that the Feds are proposing a bailout of massive order. They don't call it a bailout, of course, and yet everyone cheers. The casino changed a few rules, and the gambling continues.

How does Wall Street and its minions think this work? How?

[firestarter]

Good post by Mish (in short we're setting up for the mother of all crashes):

Mish: click here


sjn, The govt will not buy the paper at mark to model. No way. That's why this, when minds wrap around it, will lead to a violent market reaction to the downside, no doubt with the aid of suspending shortselling. Dumb and dumber.

[TommyJefferson]

$this->bbcode_second_pass_quote('Carlhole', 'T')his whole experience is tailor-made for Ron Paul. If he doesn't come out with a totall explanatory video or something, he's just not trying.

[firestarter]

More from TF's Mr Mortgage:

$this->bbcode_second_pass_quote('', 'I') am going to post this to the blog and don't want to weed through smiley faces. Thanks gang.

Here is a question no one has addressed: Will the US Banana Republic Bailout include buying crappy paper from foreign entities? If it does not, foreigners will sell their crappy paper to US subsidiaries or brokers who will then dump the crappy paper onto US taxpayers. If foreigners cannot sell to US intermediaries, global credit markets are likely to remain in disarray.

How will US taxpayers react if they discover that they are bailing out the entire world’s crappy paper? Heck they probably don’t realize that they are already bailing out the world’s agency holdings.

The major hurdle in the Banana Republic Bailout Plan is in assigning value to crappy paper and derivatives. If the government assigns realistic values, this will greatly impair not only institutions on the ropes but those that people don’t realize have beaucoup crappy paper. All those wondrous ‘mark to model’ assets could be assigned far lower values. This would impair other holders of the crappy paper.

This could foster a much larger crappy paper dump onto the government as well as tarnish banks that were thought to be sterling.

[Forney2008]

$this->bbcode_second_pass_quote('', 'H')e's trying.

[Heineken]

I'm a fan of many of Ron Paul's ideas, but I think he's washed-up as a campaigner. He presents too feeble and confused an image, probably because he's showing his years. It's too bad, but that's what time does to us all.

If there is hope, it does not lie in Ron Paul. Maybe someone else will take up the Paul ball and run with it.

[ProudFossil]

$this->bbcode_second_pass_quote('Forney2008', '')$this->bbcode_second_pass_quote('', 'H')e's trying.

[Heineken]

No, just send them a little more of your money IF you're making more than $250,000.

If you're making less than that, you get to send them less AND you get a check for $1,000 in Monopoly money.

Is that so hard to understand?

A detail the GOP always leaves out as it attempts yet again to pull the wool over the sheeple eyes.

I don't stand for any particular party, but I really despise the lie you're perpetuating here, Fossil.

[sittinguy]

Why isn't the dollar falling? This should be a clear sign of funny money in play. I,m gonna photo copy a dollar till I run out of paper, and then I'm gonna throw it all up in the air over and over, and sing happy days are here. You know what sucks is the fake dollars on copy paper will be worth more than the real thing soon.

Really the dollar has to fall soon because of this??

How long is this going to buy us? a year at most

[ProudFossil]

$this->bbcode_second_pass_quote('Heineken', 'N')o, just send them a little more of your money IF you're making more than $250,000.

If you're making less than that, you get to send them less AND you get a check for $1,000 in Monopoly money.

Is that so hard to understand?

A detail the GOP always leaves out as it attempts yet again to pull the wool over the sheeple eyes.

I don't stand for any particular party, but I really despise the lie you're perpetuating here, Fossil.