Another Taxpayer Ripoff: Government Buy-in of CitiGroup

February 27, 2009 at 11:18 am in Bailout, Banks by IfLizWereQueen

geithner-1.jpg picture by eeberry paulson-1.jpg picture by eeberry

Geithner: It’s not a clenched fist, it’s a claw. Paulson: That’s my boy.

As Usual, Centrist Democrats do it half-way and as a result will ruin it all.  This is not a time for half-measures:  Either let these damn banks fail or take FULL public ownership at least temporarily.  Obama better fire a few of his centrist Democrats like Geithner and replace them  with Progressives.

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I  read an article by Eric Dash that appeared this morning in the New York Times appropriately titled “U.S. Agrees to Raise Its Stake in Citigroup” –Very appropriate title and descriptive of what has happened.

Dash could have added the following to the headline to make it even more appropriate:  U.S. Agrees to Raise Its Stake in Citigroup and further expose the US Taxpayer to a certain loss once again at the hands of the rich and Wall Street Shysters.

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WHAT IS WRONG WITH THIS DEAL?

1.  KEEPING THE SAME CEO

Obama needs to take a look at what Sarkozy did a week or so ago.  France took over two banks and they only had 26% share, but Sarkozy fired the CEO and appointed a new one in his place.

First of all what is wrong is that the same person who led the bank to its current failure status, Vikram S. Pandit will remain.  Why? Why should the American people be required to trust our hard-earned tax dollars to a proven failure?

2.  TRUSTING TIMOTHY GEITHNER, A PROTEGE OF HENRY PAULSON

Second of all, why would be expect any kind of a decent deal for the American taxpayer to be negotiated by the likes of Timothy Geithner, a protege of Henry Paulson, the man who negotiated, thus far the largest rip-off of the American taxpayers at the hands of the banking cartel.  Yes cartel that’s what they are–a proven bunch of crooks, liars and thieves.

3. TAXPAYERS AS MAJORITY STAKEHOLDERS  NOT TAKING FULL CONTROL OF CITIBANK

Congress, Obama and Geithner are not representing the majority of the people of the USA.  They are representing the minority rich to the detriment of the rest of us.
This is so typical of a deal struck by Republicans and Centrist Democrats and it is just more of the same. Use the American taxpayers money to provide welfare for corporations. Taxpayers, after pumping more than $45 billion into the bank, have become Citigroup’s single largest shareholder.  Ownership without control is a recipe for disaster.  Economists who have their head out of the sand like Paul Krugman, Dean Baker and Joseph Stiglitz are all telling is this–and we are going to follow a jerk’s advice  like Geithner?  SOURCESOURCE,

4.  BANKS FAIL ALL THE TIME.  THERE IS NO NEED TO SAVE THEM.

The American people are being hoodwinked into thinking that we have to save CitiBank and/or Bank of America and/or Chase.  THAT IS A DAMN LIE.

Joseph Stiglitz – Nobel Prize Winner of Economics reminded us that banks fail all the time that that it is no threat to our economy if a mismanaged bank like Citibank, or BoA fails.  I trust his opinion over that of Henry Paulson, Jr.–a.k.a. Timothy Geithner.

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WHAT WILL COME OF THIS DEAL?
No one explained it better than Mike Whitney in his piece “The Geithner Put”

“Timothy Geithner is putting the finishing touches on a plan that will dump $1 trillion of toxic assets onto the US taxpayer. The plan, which goes by the opaque moniker the “Public-Private Investment Fund” (PPIF), is designed to provide lavish incentives to hedge funds and private equity firms to purchase bad assets from failing banks. It is a sweetheart deal that provides government financing and guarantees for illiquid mortgage-backed junk for which there is no active market.  .  . “  MORE

Proclaim the Queen!