The Bail outs your thoughts

[The Voice]

Does anybody know what the CEO pay thing is that's in the bill?

 

[Lee]

Does anybody know what the CEO pay thing is that's in the bill?

I heard something about it. And morally I love the concept, but in the end the ceo's will win in court to get their money. A contractual obligation to compensate a person cannot be broken by even congress unless criminal activity is proven. Now, most of these ceo's such as my favorite and yours Mozzilo where crooks, but proving it beyond a resonable doubt in a court of law might be difficult.

An example of something I mentioned earlier about college vs real world. When I was in college I did this huge disertation in grad school on ceo's compensation. I mentioned they were over compensated, and the maner of compensation was not always accurately reported to the stock holders on the balance sheet. When a stock option is issued, it has almost no value. It is at that time it is reported on the balance sheet and it comes out of equity side, not shown in the liability side at all. Well a year later, if the stock goes up a little, the executive can cash in...and cash in big. Sometimes to the tune of 25-40 million dollars. All without the knowledge of most stock holders unless the are highly trained at reading financial statements. It is pretty well hidden. Well to say the least this was rather idealiistic of me.

Fast foward 12 years later or so to today. I still hold the same morals, but I am not nearly as naive. I realize the golden rule. Those that have the gold, make the rules. Thus the ceo's always get paid. The bill will have something about the ceo compensation in there, and it will be very popular among the masses. But here is what will happen. Long after the bill passes and people move onto the next big topic. Maybe a baby fell down a well again, or something equally as improtant to the nations welfare. When this happens, this bailout will be forgotten by most including the media. Well, it will be found the rider that limmits the ceo compensation is not very enforcable, and full of some major loopholes. So, the ceo's will still get their compensation, and the average guy....joe public...will forget to be upset about it or even notice.

Is this ethical? Is this right? Ofcourse not, but this my friend is how the world works. Want some zoning issue or something simular approved by a public official, how do you do it? Grease his palms. Bussiness owners, am I correct? Its unfortenate, but its true. Its this reality that forces alot of proffessors who cant deal witht he real world back into the classrooms where they feel they can teach morality. Unfortunetely morality is not typically reality in the real world. Oh to be able to live in acadamia.

 

[RonG]

I am really hoping this does not pass in its current form, the more the day wears on the more pissed I get about the earmarks in this.

 

[Lee]

I am really hoping this does not pass in its current form, the more the day wears on the more pissed I get about the earmarks in this.

I dont like the earmarks myself, but that is what our goverment does. Either it passes with earmarks, or it does not pass. Its crap, but is what it is.

 

[RonG]

At some point we have to make it change. I swear im on the verge of voting against every incumbant in Texas reguardless of who the other canidates are. This truly sickens me.

 

[Maximus]

Who is the ANTI-EARMARK KING???

 

[Lee]

For those that dont know, this is not the earmark we are refering to.

 

[Wolfman]

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[RonG]

And so it Starts,

California may need $7 billion federal loan

(CNN) -- California may need a $7 billion emergency loan from the federal government to pay for "teachers' salaries, nursing homes, law enforcement and every other state-funded service" this month, Gov. Arnold Schwarzenegger warns.


California is running short on cash, Gov. Arnold Schwarzenegger warns in a letter.

Schwarzenegger gave the warning in a letter sent Thursday to U.S. Treasury Secretary Henry Paulson.

The letter, published in Friday's Los Angeles Times, was written on the eve of an expected vote in the U.S. House on the federal bailout of the financial system.

"The federal rescue package is not a bailout of Wall Street tycoons -- it is a lifeboat for millions of Americans whose life savings, businesses, retirement plans and jobs are at stake," Schwarzenegger said.

California State Treasurer Bill Lockyer issued a statement a day earlier saying because of the national financial crisis, California "has been locked out of credit markets for the past 10 days."

"Absent a clear resolution to this financial crisis that restores confidence and liquidity to the credit markets, California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the federal Treasury for short-term financing," Schwarzenegger wrote.

The governor warned that a number of states are facing the same cash flow crunch this month, but that his state is "so large that our short-term cash flow needs exceed the entire budget of some states."

Schwarzenegger said his state would attempt to sell "$7 billion in Revenue Anticipation Notes for short-term cash flow purposes in a matter of days."

Lockyer said that unless the national economic crisis subsides and California can secure private short-term loans "the state's cash reserves would be exhausted near the end of October."

"Payments for teachers' salaries, nursing homes, law enforcement and every other state-funded service would stop or be significantly delayed," Lockyer said. "And California's 5,000 cities, counties, school districts and special districts would face the same fate."

The federal bailout for the financial system is expected to return to the House for a vote Friday after it passed the Senate Wednesday night.

The legislation would permit the Treasury to buy up $700 billion of bad assets -- most of which are backed by mortgages -- from banks in an effort to clean up their balance sheets so they can resume lending.


The credit crunch, a decline in state tax collections and a delay in adoption of a state budget have combined to aggravate California's cash flow troubles.

"The economic fallout from this national credit crisis continues to drain state tax coffers, making it even more difficult to weather the continuation of frozen credit markets for any length of time," Schwarzenegger

http://www.cnn.com/2008/POLITICS/10/03/california.loan/index.html

 

[Lee]

And so it Starts,

California may need $7 billion federal loan



http://www.cnn.com/2008/POLITICS/10/03/california.loan/index.html

Cali has been in bad shape for a long time. I was not an Arnold supporter, but her has done a commendable job getting cali's budget back under control, but this economic downturn is going to hurt them bad. With nearly 1/8th of the countries population living in california, and it being the most economically important state, I see the loan being given to them. I am scared for Cali though, these next 5 years could be devastating even more so than the rest of the country.

 

[RonG]

Cali has been in bad shape for a long time. I was not an Arnold supporter, but her has done a commendable job getting cali's budget back under control, but this economic downturn is going to hurt them bad. With nearly 1/8th of the countries population living in california, and it being the most economically important state, I see the loan being given to them. I am scared for Cali though, these next 5 years could be devastating even more so than the rest of the country.

Well hopefully there value of the property gets more in line with the rest of the nation. 400k for 3 bedroom 2 bath houses, could be part of their problem.

 

[Lee]

Well hopefully there value of the property gets more in line with the rest of the nation. 400k for 3 bedroom 2 bath houses, could be part of their problem.

Manhatten, Chicago, Portland, Seatle, hawaii, etc.....there are plenty of other places that have huge living costs in this country. Their economy seems to be the most volitile though of all the states.

 

[RonG]

I have to admit I am blessed to be back in the houston area. We aren't recession proof, but pretty close to it. After the 80's the city did an excellent job of diversifying. Im in the energy field now, so job security is not a concern. Moving out of the Cleveland area was definately one of the best moves for my family.

 

[RonG]

Well the bill passed, I am glad something has been done, but those bullshit ear-marks did not belong in that bill.

 

[Wolfman]

The bill just passed the House :thumbdown