Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
Congressional Leaders Were Stunned by Warnings

   By DAVID M. HERSZENHORN
Published: September 19, 2008  NYT

WASHINGTON -- It was a room full of people who rarely hold their tongues. But as the Fed chairman, Ben S. Bernanke, laid out the potentially devastating ramifications of the financial crisis before congressional leaders on Thursday night, there was a stunned silence at first.

Mr. Bernanke and Treasury Secretary Henry M. Paulson Jr. had made an urgent and unusual evening visit to Capitol Hill, and they were gathered around a conference table in the offices of House Speaker Nancy Pelosi.

"When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program "Good Morning America," the congressional leaders were told "that we're literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally."

Mr. Schumer added, "History was sort of hanging over it, like this was a moment."

When Mr. Schumer described the meeting as "somber," Mr. Dodd cut in. "Somber doesn't begin to justify the words," he said. "We have never heard language like this."

"What you heard last evening," he added, "is one of those rare moments, certainly rare in my experience here, is Democrats and Republicans deciding we need to work together quickly."

Although Mr. Schumer, Mr. Dodd and other participants declined to repeat precisely what they were told by Mr. Bernanke and Mr. Paulson, they said the two men described the financial system as effectively bound in a knot that was being pulled tighter and tighter by the day.

"You have the credit lines in America, which are the lifeblood of the economy, frozen." Mr. Schumer said. "That hasn't happened before. It's a brave new world. You are in uncharted territory, but the one thing you do know is you can't leave them frozen or the economy will just head south at a rapid rate."

As he spoke, Mr. Schumer swooped his hand, to make the gesture of a plummeting bird. "You know we'd be lucky ..." he said as his voice trailed off. "Well, I'll leave it at that."

As officials at the Treasury Department raced on Friday to draft legislative language for an ambitious plan for the government to buy billions of dollars of illiquid debt from ailing American financial institutions, legislators on Capitol Hill said they planned to work through the weekend reviewing the proposal and making efforts to bring a package of measures to the floor of the House and Senate by the end of next week.

-Skip-

But it was clear they continued to examine ways to make clear (Make it appear?) that the government was stepping up not just to help the major financial firms but also to protect the interests of American taxpayers and families by safeguarding their pensions and college savings, and by preventing any further drying up of consumer credit.

In addition to potential stimulus measures, which could include an extension of unemployment benefits and spending on public infrastructure projects, Democrats said they intended to consider measures to help stem home foreclosures and stabilize real estate values.

(My bold italics.)

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Sep 19th, 2008 at 06:01:53 PM EST
[ Parent ]
This reminds me so much of the "We MUST invade Iraq" bullshit, and now we sit and regret it, and the bastards who lied to us are at it again.

America, the STUPID!

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Fri Sep 19th, 2008 at 06:21:55 PM EST
[ Parent ]
I remember the "We must invade Viet Nam" bullshit.

Americans fall for the same old line, all the time.

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Fri Sep 19th, 2008 at 06:34:17 PM EST
[ Parent ]
That's because it was true that one time.
by paving on Sat Sep 20th, 2008 at 04:19:30 AM EST
[ Parent ]
The only TRUTH that I carry away from Viet Nam was that Lady Byrd (Bird?) Johnson owned a slew of Bell Helicopter stock in the mid '60s and LBJ got fabulously wealthy from Huey helicopters once the war cranked up.  

What's your TRUTH?

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Sat Sep 20th, 2008 at 05:36:13 AM EST
[ Parent ]
That's because it was true that one time

Not sure what "that one time" refers to.  Viet Nam?  

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Sat Sep 20th, 2008 at 10:31:44 AM EST
[ Parent ]
On what planet are they living? How stupid are they?

Systemic rik has been discussed here on ET - on the basis of newspaper reports - for the past 3+ years.

So - how stupid do they think we are??

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sat Sep 20th, 2008 at 06:11:54 AM EST
[ Parent ]
On what planet are they living? How stupid are they?Given how the Beltway people behaved before and during the Iraq War, how can you be surprised?

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sat Sep 20th, 2008 at 06:20:44 AM EST
[ Parent ]
So - how stupid do they think we are??
At least for the purposes of their own reelection, they seem to have a pretty accurate estimate of the stupidity of the general population, sadly.


"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Sep 20th, 2008 at 09:57:38 AM EST
[ Parent ]
Some Wall St noob:
the government was stepping up not just to help the major financial firms but also to protect the interests of American taxpayers and families by safeguarding their pensions and college savings

Comedy gold.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Sat Sep 20th, 2008 at 06:57:38 AM EST
[ Parent ]
Both of which could be protected much more easily if the government provided better retirement benefits through social security, and effectively funded higher education.
by Zwackus on Sat Sep 20th, 2008 at 07:35:39 AM EST
[ Parent ]
Question for the financial mavens:

Stock markets around the world are "soaring" according to Sat. A.M. news reports, meaning ?

a. US taxpayers are becoming debt slaves

b. The end of the US Empire

c. The vultures are circling the half-dead corpse

d. Give your own interpretation.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Sat Sep 20th, 2008 at 07:55:36 AM EST
[ Parent ]
Also, a MSNBC bimbo just asked if there is anything that could knock the economy out of the #1 news slot?

My answer: Of course.  If the Repubs/McCain ACTUALLY want to win this election (I'm not convinced they do), just let (ANOTHER) 9/11 happen in the US, a nuclear one would be sweet.  Then watch all of the US pussies fall in line.  Bye-bye Obama.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Sat Sep 20th, 2008 at 08:13:35 AM EST
[ Parent ]
Sure, nuking Iran.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
by Carrie (migeru at eurotrib dot com) on Sat Sep 20th, 2008 at 09:10:27 AM EST
[ Parent ]
The "threats" are coming in.  Accept whatever the big-boys come up with or we could see a DEPRESSION with 12% (or higher ?) unemployment; reported 6% now.

So SHUT UP AMERICAN AND BEND OVER!!!

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Sat Sep 20th, 2008 at 08:21:31 AM EST
[ Parent ]
OK, now a Wall Street Journal half-wit on CSPAN Washington Journal says that the US could have a $1 trillion budget deficit next year.

Consequences (of even saying it)?

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Sat Sep 20th, 2008 at 08:54:58 AM EST
[ Parent ]
The government's action just seeded yet another mini-bubble. We'll see how long it lasts.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
by Carrie (migeru at eurotrib dot com) on Sat Sep 20th, 2008 at 09:10:06 AM EST
[ Parent ]

Display:

Occasional Series