Bailoutmania Could Bankrupt US Government

Posted by Bill Hennessy on November 10, 2008 under Economy, Politics |

Once responsible companies are now basing decision critical decisions on government handouts.  This is this is an expected, but unplanned for, result of the Paulson’s Panic in September. Says the Wall Street Journal:

The rescue efforts are "evolving in ways that I don’t think anyone anticipated," said Camden Fine, president and CEO of the Independent Community Bankers of America, a trade group. "Things are just hitting them from every single direction, every day, and I don’t think they know whether to spit or go blind."

In the past 2 business days, GM and Ford CEOs crawled and groveled before their masters in Congress, Reid and Pelosi; AIG received another $25 billion of our money to flush down yet another crap hole; American Express became a bank to apply for government money. From WSJ.com:

On Monday, mortgage giant Fannie Mae said it is losing money so rapidly it may need a cash infusion from the Treasury Department by year’s end. The funds would come from a special $100 billion pool Treasury set aside back in September to aid the company. Fannie Mae had a loss of $29 billion for the third quarter.

The money, though, is running out.  Expect US Treasuries to be downgraded before Obama takes the oath. 

Then we’ll be in a world of hurt.

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