King Henry

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

You have got to be kidding me. You are a pretty funny guy, Paulson.

The way Bernanke sees the auction working, however, it’s the other way around: the banks would tender their assets for sale, and then Treasury would put in a bid at what it considers “close to the hold to maturity price”

Which means that the Treasury would have no idea what the market rate is on this toxic debt, and would probably end up paying whatever the original price was. This is simply crazy.

As Rich says:

1. It’s ridiculous that we are using taxpayer money to pay above market prices for possibly worthless assets and that the proceeds are going to highly paid people who knowingly took huge risks.

2. I hope there is going to be some sort of accountability among all the regulators who first denied the risks and are now throwing our money at fixing their aftermath. If all the same people stay in charge, this kind of stuff will just keep happening.

I’d also add a third point: If taxpayers are on the hook for recapitalizing the institutions, there needs to be equity participation for taxpayers.

The whole thing is eerily similar to the last time we heard “trust us”.

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