$700 Billion Bailout Package is Bush's Parting Gifts for His Friends

The $700 billion bailout package being considered in Washington is yet another scam for the American people. It is George W. Bush's parting gift to his wealthy and crony friends. Let me explain why and how it will work.

The bailout plan, as proposed by our doing-nothing Security of the Treasury, Henry Paulson, called for no rules, not oversight, no questioning by Congress, on how the $700 billion dollar will be spent. He also said on Meet The Press over the weekend that it is impossible to assess the true value of these securities. Did you see the problem yet?

Once again, the Republicans have out-maneuvered the Democrat with 7-weeks to go before the November 4th election. They know the Democrat will not have the guts to stand-up against their plan, no matter how unreasonable it is. Plus, the economy does need this rescue plan, badly, unfortunately (will discuss the blame later). So, I think it is safe to say that the Congress will approve this plan, pretty much the way it is by this Friday.

The problem with this plan is clearly visible that like robing a bank in broad daylight with FBI protection. This is how it will work. The Treasury will package the mortgage-backed securities into large chunk (so you and I can't afford it and they don't want to deal with too many buyers). Let's say $100 million in original loan amount. Since Paulson said you can't assess its true value, what is to stop him from selling that $100 million securities to his crony buddies at any amount he wishes (remember, not rules and oversight). Let's say for $10 million.

Now, you and I and most average American people can't buy $10 million in asset, let alone we probably don't have the connections. Those who brought (with connections) can easily resell the securities to secondary buyers (without connections) with a good sizable profits.

Why? Eventually, the mortgages will be sold to some auction house which break it down and sell off the properties to another buyers at a discounted of 50%. Wait a minute, between what the Treasury will ask for and its final selling price when they get back on the market, there are many many millions and billions of dollars of profits to be made. The beneficiary are the Bush's and Republican cronies.

Unfortunately, these people are shameless.