Financial Crisis: The Philippine Version

[jpdm]

why is it the GOVERNMENT always has to do everything?

can't the people help themselves?

do we live in a nanny state?

Well, who are you referring to?

How about this statements that you made?

The nanny here is the government. Big companies need the support of the US FED

Cant these big companies help themselves?

If people, especially militants ask for doleouts, its nothing kasi barya barya lang ...but when you nanny big companies it hurts..they need big money for them to be bailed out...Di lang AIG sabi mo pati Goldman Sachs..

In the case of the US as you said, the small ones are not bailed out.Manigas sila.pero big ones kailangan ng yaya o nanay o benefactor.

Hay pag mayaman o malaki ka ok, pag militante hindi...Dapat pareho di ba...


So much for these "fittest."

Lampa rin pala.

the Fed lent money to AIG so AIG could pay its obligations to counterparties who won in the derivatives bets.

in effect, the Fed is protecting the counterparties, not AIG.

The Fed loans are actually very very punishing on AIG... to the point napilitan ang AIG magbenta ng ari-arian.

It's clear naman who the Fed is favoring. And it's not AIG.

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Yes, the US is bailing out financial institutions.

here's where survival of the fittest applies:

If u are just a small ailing bank, the FDIC shuts u down.

If u are a small business or just an individual, and you get in trouble, nobody is gonna bail u out.

To get a bailout, u have to be big. As in very very big. Super interconnected with everyone...

So big that if u fail, u take the whole world down with you.

That's when u get bailed out.


You're thinking kasi pag na-bail out ka ng govt or pag nakialam ang gobyerno, di na nag aaply ang survival of the fittest.

Remember, the govt is PART of the biosphere. Part sya ng environment. So players or competitors use links to the govt as a survival strategy.


It's a survival advantage if u got connections.

[jpdm]

why is it the GOVERNMENT always has to do everything?

can't the people help themselves?

do we live in a nanny state?

This will answer your question...

If a businessman is close to someone in Malacanang, and he is able to get his goods out of customs without paying proper taxes, then he has a competitive advantage over a businessman who has no connections in Malacanang coz he has to pay full taxes.
so that makes the businessman with connections is "fitter" than the other businessman. Gets?

Or if a company that is engaged in a certain industry lobbies the govt not to allow other companies to compete with them in that same industry, then that is their survival advantage.

That happens all the time here.

Diba u are the one who is always saying meron oligopoly dito sa atin?

well, how is that oligopoly being maintained?

The top businessmen in the country have friends in the highest places in govt.

[SIZE=3]They exist for mutual benefit. I make you rich, u make me rich.
[/SIZE]

_______

Goldman Sachs.

Goldman Sachs is a large counterparty of AIG.

AIG owed billions to Goldman in derivatives bets.

AIG was bailed out so Goldman would get paid.

The fitter one, the winner is Goldman Sachs.

Somebody very powerful is looking after Goldman.

[jpdm]

As I said, ULS, its better to just give barya-barya dole outs to militants and protesters, instead of giving the whole vault of dole-outs to big voracious corporations..

The poor taxpayers and shareholders including militants and protesters will be the loser in the end...

This bail out plan for big corporation is a big pain in the neck of many US taxpayers..

It also unraveled the so-called Free-market...

Now, with 80% of AIg owned by US taxpayers US government)--what kind of economic ideology is this??

SOCIALISM (a.k.a. capitalistic term-Welfare State or Mixed System) -a militant government that actively intervenes in the economy...

Yan ang USA, champion ng laissez faire-neoclassical-globalist capitalism...

Mas gusto ko pa France and Sweden...aminado na may pagka socialist-democrat sila...

Business Mirror
November 4, 2008

AIG Rescue May Fail, Analysts Say

WASHINGTON—A number of financial experts now fear that the federal government’s $143-billion attempt to rescue troubled insurance giant American International Group (AIG) may not work, and some argue that company shareholders and taxpayers would have been better served by a bankruptcy filing.


“No one else benefits,” former AIG chief executive and major shareholder Maurice “Hank” Greenberg wrote to AIG’s current chief executive on Thursday. “[SIZE=3]Unless there is immediate change to the structure of the Federal loan, the American taxpayer will likely suffer a significant financial loss.”[/SIZE]


Another concern is that in this depressed market, AIG, and the taxpayers that now own 80 percent of the company, will lose coming and going.


The company may be forced to borrow additional federal funds for rising payouts to counterparties.




The Federal Reserve and its advisers have acknowledged privately that things are not going according to plan. As AIG has rapidly eaten through the loan money, [SIZE=3]the Fed has twice expanded its original $85-billion bailout—which itself was the largest government bailout of a private company in US history.[/SIZE] (The Washington Post)

[tidus1203]

Yep what the US is doing right now is socialism for the rich but it also comes down to survival of the fittest. These people are TOO BIG TO FAIL ika nga by the US government. If they fail it will have dire consequences for everyone even those who are not involved. Kaya everyone wants to become TOO BIG TO FAIL

[uls]

haha

HEY! i wanna be too big to fail too

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The company may be forced to borrow additional federal funds for rising payouts to counterparties.

That's where the biilions AIG borrowed goes to...

paying counterparties.

Nakipagpustahan ang AIG... natalo sya... kelangan nya magbayad

Declare bankruptcy? No way. Ano sya? sinuswerte? easy way out?

Kelangan magbayad ang AIG.

Hindi mga small time ang kapustahan ni AIG... mga predators yan.

Top of the food chain.

You don't lose bets with Goldman Sachs and not pay up.

AIG board members discussed a growing dispute between AIG Financial Products and Goldman Sachs about the value of those assets when Goldman called for AIG to post collateral. AIG's chief financial officer warned of "Goldman's acknowledged desire to obtain as much cash as possible."

When you owe Goldman money, you better pay up.

Walang pambayad? Maghanap ng pambayad. Mangutang.

That's why AIG was bailed out by the US.

Ganyan kalakas ang Goldman Sachs.

[uls]

BTW, who says hedge funds can't make any money these days...

For the month of October, Greenlight Capital Qualified, L.P. returned 13.2% (net of all fees and expenses). Greenlight Capital Qualified, L.P. has returned 26.4% for the year-to-date.

that hedge fund is run by David Einhorn

Dude with killer instinct

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AIG will keep on borrowing more money

Coz it will end up having to pay $300B to $400B to counterparties... maybe more...

That initial $85B loan is no way near enough...

The bailout wasnt intended to save AIG...

The bailout was intended to save AIG's counterparties.

I've been saying that weeks ago in the "AIG facing liquidity crisis" thread

[jpdm]

. Kaya everyone wants to become TOO BIG TO FAIL

haha

HEY! i wanna be too big to fail too

bee careful of what you wish for..you might end up just like Enron and Lehman...

[jpdm]

Yep what the US is doing right now is socialism for the rich but it also comes down to survival of the fittest. These people are TOO BIG TO FAIL ika nga by the US government. If they fail it will have dire consequences for everyone even those who are not involved. Kaya everyone wants to become TOO BIG TO FAIL

Using the term of one poster here, the US FED is the nanny of these supposedly big companies-the "fittest"

and yet..

Without this US bailout plan, AIG and Goldman Sachs are both wimps that the US taxpayers should have not rescued....

[ocanursjr]

As far as i know matagal ng krisis sa atin.

Widening gap between rich and poor.
Poverty level is on the rise.
Corrupt government official.
Greed
Many to mention guys...

[True Faith]

It will take around 2 or mare years to solve the financial crisis in the US...(according to Pres. Obama)

...In the Philippines kaya?or are we in perpetual financial crisis (plus fifth in world hunger)

..Its a good thing Philippine banks are very very conservative....

..Pinoys despite their wasteful spending...buy products in cash and not through plastic money....