Posts Tagged ‘ nationalization ’

White House plan to create ‘bad bank’ would increase federal influence

The Federal Reserve has cut rates to zero and flooded the financial system with money. Congress has spent $350 billion — and committed another $350 billion — to shore up the battered banking industry. Banks have already booked roughly half a trillion in losses, and analysts say they could be looking at a half a trillion more.

http://www.msnbc.msn.com/id/28880095/

In his confirmation hearing last week, Treasury Secretary Tim Geithner said the White House is working on a new bank rescue plan. He was short on details, but the massive scope of the problem has prompted talk that the administration may be planning to “nationalize” a large portion of the banking industry.

In its most extreme form, nationalization would mean that the government buys (or takes) all the shares of stock and takes over operations of the company, keeping the profits. Such state ownership is typically a form of socialism; major oil producing countries, for example, have set up state-owned companies to produce and sell oil, using the proceeds to pay for government services.

Why is the government so involved?

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(VIDEO) Ron Paul: We are on road to Nationalization

Ron Paul from the floor of the House speaking out against the Auto Bailout among other things.

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