Bank of America - Merrill Lynch Merger

[monsoon]

Congress cannot unilaterally change the subscription agreement by which it purchases preferred shares from companies. ...

Do you care to cite an item in the Constitution that would prevent the Congress from doing this? I would be interested in hearing it. That is the only document that restricts what they can do. Any federal law previously passed by Congress, including all laws rules and regulations having to do with banking, can be modified and canceled, as Congress sees fit. It only requires the President to sign it into law and there are many situations where even that isn't necessary.

[monsoon]

......

It's like her thought process is ... how do I improve an economy that is sezied by (badly needed) deleveraging? By creating incentives (or, without incentives at all, but by attempting to bully or "regulate" banks) to pour more debt into the system. Gotta make sure people are buying flat screens and cruises on credit without impediment by reason of income or existing leverage, right? It's their fundamental American right! What's next? More deposit-less NINJA loans? If they heed her call to abstain from raising interest rates, they create the impression that low interest rates are en entitlement. The last thing needed is the demonization of companies trying to raise rates in recognition of specific realities.

You are on a different subject now. That is in how to fix the American economy. Sadly the Congress, the President, certainly the self-important bankers, the financial experts, and most of the media and so forth are completely clueless on this matter. However that is irrelevant to holding the banks accountable for what they have done. I don't think these banks should have been given a dime of tax money and should have been put out of business. It's not like there are not 8000 other banks in this country that couldn't take up the slack. BTW, the leading economic theory supported by the Treasury, the government, and practically everyone else is that a healty American economy is based on consumer spending. So based on that the right to buy flat screen TVs these days seems to be considered a right just as much as a banker taking $100M tax financed bonus.

I have said before that you don't fix an economy drunk on leveraged based spending by giving them more credit. This lesson has not been learnt (or rather re-learned) by Americans who still mostly see the lack of credit as the reason for the ongoing collapse.

[troyboytn]

Lord, I just watched Maxine Waters.

She's an idiot.

No she's not. She happens to be quit an intellegent person. She's just pissed, like the people of California that she represents. She has recently been a big advocate for the people that these banks have either directly or indirectly crushed with their corporate foot. We need MANY more politicians like her.

[Commoner]

Do you care to cite an item in the Constitution that would prevent the Congress from doing this? I would be interested in hearing it. That is the only document that restricts what they can do. Any federal law previously passed by Congress, including all laws rules and regulations having to do with banking, can be modified and canceled, as Congress sees fit. It only requires the President to sign it into law and there are many situations where even that isn't necessary.

The Constitution, as currently amended, is the "highest law of the land." Constitutional law is not merely the Constitution, but also hundreds of years of federal district and appellate court precedent interpreting the document. Congress may not use its legislative powers to overrule the judicial branch's constitutional rulings (absent proper amendment of the document itself). I can find the citation if you really want it. This comports with the checks and balances intended w/r/t the judicial branch's final say so w/r/t all things constitutional.

The subscription agreement was no different than any contract you or I would enter into for the purchase of prefrred shares. Congress' attempt to unilaterally change those terms would be tantamount to the seizure of property without due process of law. Not that it would ever even come close. The minute Congress even pretended that it intended to unilaterally amend agreements is the minute it loses all credibility with counter parties in all types of transactions. China comes to mind.

[Commoner]

You are on a different subject now. That is in how to fix the American economy. Sadly the Congress, the President, certainly the self-important bankers, the financial experts, and most of the media and so forth are completely clueless on this matter. However that is irrelevant to holding the banks accountable for what they have done. I don't think these banks should have been given a dime of tax money and should have been put out of business. It's not like there are not 8000 other banks in this country that couldn't take up the slack. BTW, the leading economic theory supported by the Treasury, the government, and practically everyone else is that a healty American economy is based on consumer spending. So based on that the right to buy flat screen TVs these days seems to be considered a right just as much as a banker taking $100M tax financed bonus.

I have said before that you don't fix an economy drunk on leveraged based spending by giving them more credit. This lesson has not been learnt (or rather re-learned) by Americans who still mostly see the lack of credit as the reason for the ongoing collapse.

I didn't really change the subject. You asked how I disagreed with Waters. That paragraph was directed at what Congress should be doing (or, to be precise, sarcastically depicting why they shouldn't be doing what they're doing). By advocating for more and more debt in the system and then lambasting them for their prior overextensions of credit to borrowers, she wants to have her cake and eat it too. If she wants any credibility in trying to bully the institutions into a certain pattern, she needs to choose one. My point is that she lacks the intelligence or tools to do so.

This isn't to say that she isn't a fine advocate for constituents who might want to blame the banks for their decision to lever up for electronics or SUVs ... and they're entitled to it. God bless 'em. But I don't know why that makes her credible when it comes to the dispensation of advice to bank CEOs.

Besides -- she (and the committee) isn't without blame. As cathartic as it was for every Representative to bloviate on CNBC for 10 minutes, let's not forget that the Banking and Finance committee serves in an oversight capacity. Where were they when the RE bubble took off (helping to inflate it?)? Now that prices are plummeting, bringing with it the rest of the economy and much of the financial system, what is she and the rest of the committee doing to fix the problem? Telling these guys that they should be incarcerated? Asking about credit card rates being jacked up 9 percent? For as much as she has to scream about on television, she hasn't done anything credible to try to come up with a solution.

[monsoon]

The Constitution, as currently amended, is the "highest law of the land." ... Congress' attempt to unilaterally change those terms would be tantamount to the seizure of property without due process of law. ....

The Constitution is not a set of laws. Congress and the President create laws based on the provisions in the Constitution.

Due process of the law? Do you mean a law created by Congress? Your defense this would be a seizure of property without due process isn't a defense. I will remind you that Congress made the consumption and possession of alcohol illegal in the United States. They even sent out agents to seize and destroy booze and booze making facilities that were previously legal. If this isn't an example of seizure of property that was once part of a legal process, I don't know what is. The Banks as far as I know are not exempt from this sort of thing. (though I guess they might consider themselves as such) If they really wanted to, they could amend the Constitution to make commercial banks illegal, create a single national bank, and seize all of the assets of the existing banks to fund it. There is nothing to prevent this.

So yes please. I would like you to tell me where in the Constitution the rule is established the Congress can't go back and deal with these banks as it pleases. BTW, contract law isn't binding on the actions that Congress can take. I am not sure what might have given you that idea.

[monsoon]

.... As cathartic as it was for every Representative to bloviate on CNBC for 10 minutes, let's not forget that the Banking and Finance committee serves in an oversight capacity. Where were they when the RE bubble took off (helping to inflate it?)? Now that prices are plummeting, bringing with it the rest of the economy and much of the financial system, what is she and the rest of the committee doing to fix the problem? Telling these guys that they should be incarcerated? Asking about credit card rates being jacked up 9 percent? For as much as she has to scream about on television, she hasn't done anything credible to try to come up with a solution.

I don't disagree at all. I didn't support the bailout in the first place and there is plenty of blame to go around for it having been the debacle that it has been. However it will be the Congress that gets the final say in how this might end up whether the banks like it or not. There should be no need for an oversight committee given the fact the banks are being run by very rich men that are paid those prices to make sure these kinds of failures don't happen in the first place. BofA and Lewis made some incredibly stupid decisions AFTER taking the money. Lewis should have never taken $25M and turned around and done such things as invested it in the Chinese economy. I realize they have a business rationale for that but it has to be one of the most boneheaded maneuvers that I have ever seen. Now they are going to have to deal with people like Waters and her qualifications are irrelevant in the matter.

[Commoner]

The Constitution is not a set of laws. Congress and the President create laws based on the provisions in the Constitution.

Due process of the law? Do you mean a law created by Congress? Your defense this would be a seizure of property without due process isn't a defense. I will remind you that Congress made the consumption and possession of alcohol illegal in the United States. They even sent out agents to seize and destroy booze and booze making facilities that were previously legal. If this isn't an example of seizure of property that was once part of a legal process, I don't know what is. The Banks as far as I know are not exempt from this sort of thing. (though I guess they might consider themselves as such) If they really wanted to, they could amend the Constitution to make commercial banks illegal, create a single national bank, and seize all of the assets of the existing banks to fund it. There is nothing to prevent this.

So yes please. I would like you to tell me where in the Constitution the rule is established the Congress can't go back and deal with these banks as it pleases. BTW, contract law isn't binding on the actions that Congress can take. I am not sure what might have given you that idea.

It's called progeny. The federal courts interpret the document. Their interpretations are binding. Federal holdings which interpret the constitution are binding inasmuch as the document itself is, subject to subsequent overruling by courts of similar or higher jurisdiction.

By "due process of law" I mean the barriers between ownership and deprivation of ownership that are created by ... the law. You use prohibition as an example of deprivation of private property by Congressional decree. Are you aware that the seizure of alcohol assets was enabled by the due enactment of a constitutional amendment? Thus, due process requirements were satisfied.

But you're right. If they really wanted to, they could amend the Constitution. Of course ... the poeple would have to vote on it at some point (or at least their state legislatures would all have to vote on it).

Finally, contract law is as binding on the United States as it is on anybody or any entity otherwise.

Where did you take constitutional law?

I don't disagree at all. I didn't support the bailout in the first place and there is plenty of blame to go around for it having been the debacle that it has been. However it will be the Congress that gets the final say in how this might end up whether the banks like it or not. There should be no need for an oversight committee given the fact the banks are being run by very rich men that are paid those prices to make sure these kinds of failures don't happen in the first place. BofA and Lewis made some incredibly stupid decisions AFTER taking the money. Lewis should have never taken $25M and turned around and done such things as invested it in the Chinese economy. I realize they have a business rationale for that but it has to be one of the most boneheaded maneuvers that I have ever seen. Now they are going to have to deal with people like Waters and her qualifications are irrelevant in the matter.

This is starting to feel like a Twilight Zone episode. What post-TARP investment in the Chinese economy??? Did they buy Chinese debt? I do know that BAC held a secondary placement of CCB shares on the Chinese market. Basically, they disinvested from the Chinese economy. Do you mean the opposite?

[atlrvr]

Not to drift into constitutional law, but yes, there is something to keep congress from amending the constitution. It'll be a cold day in hell before 75% of states approve an amendment that nationalizes banks.

I think the big question really is, what should TARP money be used for?

Supplementing operating income (i.e. to help retain employees/services)?

Shoring up balance sheets (i.e. keeping the banks solvent)?

Loaning more money (i.e. relaxing credit requirements)?

Forgiving debt (i.e. don't worry about your past due bills, we won't foreclose)?

I think my frustration with Maxine Waters (as I posted several months ago) is that she is happy throwing money in a black hole (Options 3 & 4) because its what constituents want, not trying to stabilize the banks and economy (Options 1 & 2). She is chastising the banks for returning to their business model that was safe and profitable (charging at-risk borrowers higher rates, and not lending to those who are likely to default).

She has publically stated that she supports socialization and nationalization, so fine, she has an agenda, and lets not pretend that the influence she is trying to exert from her seat on the committee is aimed at anything less.

[kermit]

No she's not.

Did you see her questioning the CEOs about "paying fees to themselves"?

"If our representatives were intelligent and well spoken they wouldn't be very representative would they?"

[monsoon]

....

Where did you take constitutional law?.....

I assume you ask a question this of me, in an attempt to discredit, yet you have not proven anything that you claim. I have asked you several times to show me the clause in the Constitution that would put limits on how the Congress might deal with the banks including modifying and changing prior laws that exist on banking. You have not done this even though you have already acknowledged it is the Constitution that sets their power.

Likewise, the Congress never signed any contracts with the banks hence they are not bound by any of their laws in this regard. If you know otherwise, you can also cite the contract if you don't mind. But that is irrelevant. The courts can't sue Congress for breaking a contract. Where in the world did you get that idea? You imply that I don't know constitution law but that kind of thinking would demonstrate that you might want to make sure your side of the street is clean first

[monsoon]

......

I think my frustration with Maxine Waters (as I posted several months ago) is that she is happy throwing money in a black hole (Options 3 & 4) because its what constituents want, not trying to stabilize the banks and economy (Options 1 & 2). She is chastising the banks for returning to their business model that was safe and profitable (charging at-risk borrowers higher rates, and not lending to those who are likely to default).

She has publically stated that she supports socialization and nationalization, so fine, she has an agenda, and lets not pretend that the influence she is trying to exert from her seat on the committee is aimed at anything less.

I don't think anyone has even done this. My only point is that in being so irresponsible, the bankers have given control of their destiny to Waters and other members of congress. She is part of the crowd that I mentioned above that wants to cut off heads and put them on display. Let us not forget that Waters and congress's power comes from the people and the people are very angry at these banks.

I have however no illusions that members of congress are going to fix this problem. They will most likely make it worse because the real problems of this economy are not being addressed. Even the banks don't want that to happen because it would mean that some of them would have to go out of business from lack of business. Like the automobile industry, there are simply too many of them now.

[hueion39]

Here's Capuano sounding ridiculous (but sounding really good to angry citizens who don't understand the situation):

http://www.youtube.com/watch?v=FLtieiyCFMw

Commoner, thanks for posting this video. I'm in Capuano's district and I didn't see this locally. For someone who has a great deal of constituents in the banking world of Boston, he really should be chastised for his lack of knowledge of the very products he lambasted. I'm sure his staff will be very thrilled with my call to his office tomorrow.

[Commoner]

I assume you ask a question this of me, in an attempt to discredit, yet you have not proven anything that you claim. I have asked you several times to show me the clause in the Constitution that would put limits on how the Congress might deal with the banks including modifying and changing prior laws that exist on banking. You have not done this even though you have already acknowledged it is the Constitution that sets their power.

Likewise, the Congress never signed any contracts with the banks hence they are not bound by any of their laws in this regard. If you know otherwise, you can also cite the contract if you don't mind. But that is irrelevant. The courts can't sue Congress for breaking a contract. Where in the world did you get that idea? You imply that I don't know constitution law but that kind of thinking would demonstrate that you might want to make sure your side of the street is clean first

I'm asking the question because you're not picking up what I'm putting down: "progeny." With all due respect, it's not my question that discredits or doesn't discredit your stance. If anything, it's the refusal to acknowledge that federal cases interpreting the Constitution are what comprises Constitutional law. The constitution is not just the words in the document. To determine the "constitutionality" of an act (including the passage of new laws or the decision to disregard contract law), you must examine the document ... AND all relevant cases interpreting the document.

It doesn't get any more basic than that. To persist with "...show me where in the constitution..." demonstrates a lack of desire to understand an important foundation of this discussion (the constitutionality of de facto nationalization scenarios). I understand that it's not so easy to have to research federal precedent when making a proclomation as to what is or isn't constitutional, but if someone making the claims you're making isn't open to a discussion of Constitutional progeny, then this is a pointless exercise.

Hope the tone doesn't run afoul of the rules, etc. It's just an integral detail to the policies being advocated and/or speculated on.

[Durhamite]

Not to drift into constitutional law, but yes, there is something to keep congress from amending the constitution. It'll be a cold day in hell before 75% of states approve an amendment that nationalizes banks.

I think the big question really is, what should TARP money be used for?

Supplementing operating income (i.e. to help retain employees/services)?

Shoring up balance sheets (i.e. keeping the banks solvent)?

Loaning more money (i.e. relaxing credit requirements)?

Forgiving debt (i.e. don't worry about your past due bills, we won't foreclose)?

I think my frustration with Maxine Waters (as I posted several months ago) is that she is happy throwing money in a black hole (Options 3 & 4) because its what constituents want, not trying to stabilize the banks and economy (Options 1 & 2). She is chastising the banks for returning to their business model that was safe and profitable (charging at-risk borrowers higher rates, and not lending to those who are likely to default).

She has publically stated that she supports socialization and nationalization, so fine, she has an agenda, and lets not pretend that the influence she is trying to exert from her seat on the committee is aimed at anything less.

There seems to be an unwarrranted amount of blame geared towards labeling low-income or the typical minority borrowers as "at-risk". I wish the truth would hatch itself and people realize THEY contributed very little in regards to this meltdown (as they generally do but get the MAJORITY of the blame).

As in any good capitalisic society, the knowledgable with a means for abusing the system are the true culprits. Basically, when the regulations were altarered, the "so-called" investors (and people making 50k, 100k, 200k being able to buy their first or 2nd and 3rd vacation homes which they could not afford continuously bolstered a surge in an unrealisic real estate market) and are the predators who did the bulk of the damage.

Capitalism is a great thing (everybody wants to get rich QUICK, buy a sailboat, etc), but when left unmanned can be devastating. Resessions are cyclical, but this one has been magnified as a result of this behavior in my opinion.

I think the issure Representative Waters and others are steaming hot about is a set of guidelines designed to assist one set of people but ultimately getting abused by another set, driving the real estate prices out of control in many markets (poor people in America just don't have the means to do that!). I don't need an MBA from Wharton to understand outlandish greed. That's what happened....but let's blame the Poor people as usual!

[Commoner]

I assume you ask a question this of me, in an attempt to discredit, yet you have not proven anything that you claim. I have asked you several times to show me the clause in the Constitution that would put limits on how the Congress might deal with the banks including modifying and changing prior laws that exist on banking. You have not done this even though you have already acknowledged it is the Constitution that sets their power.

Likewise, the Congress never signed any contracts with the banks hence they are not bound by any of their laws in this regard. If you know otherwise, you can also cite the contract if you don't mind. But that is irrelevant. The courts can't sue Congress for breaking a contract. Where in the world did you get that idea? You imply that I don't know constitution law but that kind of thinking would demonstrate that you might want to make sure your side of the street is clean first

Sorry - just got around to the second paragraph. I posted a link to the term sheet. Nobody (including the Treasury Dept) purchases preferred stock of any kind without entering into some sort of subscription agreement (or stock purchase agreement) with the issuer. The term sheet is the closest public document I've gotten my hands on. I can promise you that UST has entered into a contract with each TARP participant by virtue of its purchase of each institution's respective pref'd shares.

That is relevant ... because Congress can absolutely be sued for a breach (or tortious interference). Of course, the Courts (as you put it) would not be the plaintiff. The banks, or another aggrieved party with "standing" would (e.g. other shareholders or counterparties). Where did I get this idea? In the course of constitutional law classes at a top-tier law school and in the course of related practice. I don't imply a lack of knowledge w/r/t con-law. I just shed light on it. The only reason I'm so persistent in doing so is because of your claims to the contrary, which don't appear rooted in any recognized theory of constitutional law.

Sorry to be so blunt; however, I feel this doesn't deviate from the existing tone of the discussion.

[monsoon]

.... If anything, it's the refusal to acknowledge that federal cases interpreting the Constitution are what comprises Constitutional law. ....

Maybe you still don't understand. Congress can invalidate any law on the books if they so desire and create new laws. Court proceedings and precedents on laws do not have any bearing on Congress because the court system does not have jurisdiction over what Congress does. The only power The Court has over Congress, and I capitalize that because I am referring to the only Constitutional Court, are the powers granted to the Supreme Ct. Their power is limited to deciding if a law enacted by Congress is constitutional or not and then only if someone petitions that enforcement of a law violates their rights under the Constitution. The court can't pass injunctions on acts of Congress. You or BofA can't sue congress to stop them from passing a law. Where exactly would such a trial take place? What judge has the right to stop congress from doing its business? The only recourse, as I sad above is for the Supreme Ct. to declare it unconstitutional, and they are not even required to hear the case or make any ruling if they so desire. This is why your argument fails.

The only clause that you mentioned which might affect them is the one you cited from Article 1, but it has never been established this is the right of a corporation and even then, it wouldn't stop congress from passing the law. They have passed a number of laws that were later determined to be unconstitutional. BTW, you first told me you could provide a citation. Now you are calling me disingenuous for asking for one. I am only asking you to do what you said you would do. I assume you changed this position because you have been unable to find anything in the Constitution that would backup what you said.

.....That is relevant ... because Congress can absolutely be sued for a breach (or tortious interference).

If this is what they taught you in that school I would say you didn't get your money's worth. The court system absolutely cannot stop congress from passing a law, and the court system can't hold congress in breach of anything for passing a law. (or changing or canceling one) Epic Fail.

[Commoner]

So now you recognize judicial review? That's progress. If Congress attempts de facto nationalization through unconstitional means (by unilaterally rewriting the subscription agreement, as you've described), the petitioners would obviously move for this review. Congress can pass whatever it wants, no matter how unconstitutional. It won't stand, though, due to that unconstitutionality. Do you mean to tell me that this whole thing has been an academic exercise regarding Congress' right to pass (but only pass) unconstitutional legislation?

This of course assumes that the President signs unconstitutional legislation.

And of course the USSC has to grant certiorari to hear and, presumptively, overturn the law.

Your arguments are red herrings. If you want to discuss substantive constitutionality, that's one thing. If you want to discuss appellate procedure, that's different. To talk about all sorts of things Congress can do w/r/t its TARP investments, and then to defend their Constitutionality with 'the Supremes might not grant cert' or 'the Federal court system can't enjoin Congress from passing the law' is just evasive.

What, specifically, are you referring to in Art. I? If I recall, Article I doesn't establish rights of individuals (or their legal alter egos, corporations) but rather articulates the legislative branch's powers. If you point me in the direction, I'll try to clarify.

As for citations (why I'm not doing what I said I would do), I'll be honest. I could log on to Lexis, find them and cite to them on here, but what would you do with them? I assume you don't have a subscription to Lexis or Westlaw. If you did, at this point, I don't have a lot of confidence in your legal reasoning skills (be honest -- the training is sort of necessary). It costs money to do the research and takes time (that I'm not already spending on these frolics). At this point, it doesn't pass cost/benefit. Moving on to the whole education thing ... we haven't seen a self-trained constitutional scholar in quite some time. (Lincoln comes to mind.) If you're the one, then more power to you. I'd dig around on Lexis or my class notes, wherever they are, if that was the case. I'm just not buying it yet. And for the last time, I am not referring to the Constitution. I'm referring to judicial precedent interpreting the Constitution. I apparently have not made this point or stressed it enough. There are not many unconstitutional policies in history that come to mind that were overturned strictly based on the text of the document. All that I can recall were products of prior federal holdings interpreting the document.

Finally, w/r/t my education. I never wrote that the USSC would enjoin Congress from passing a law. When people with Con law backgrounds make pronouncements like 'the Court wouldn't let them' or 'the USSC would overturn it', we're talking about the prompt overruling of enacted legislation. Your misrepresentation of what I'm writing leads me to believe that you honestly do not grasp these concepts (which would be NBD if you weren't so enthusiastic about your legal positions) or you just like the sport.

Nice touch with the "Epic Fail", by the way. "Frat boy humor" is de rigueur.

[monsoon]

Couple of noteworthy items.

• The banks, including BofA, have agreed to stop foreclosures for the time being. Of course an individual's mileage may vary on this, but I think that the banks have realized they need to start offering some olive branches or congress was going to let them have it. They can't be throwing people out on the street after having received hundreds of billions of dollars all while their executives are being paid obscene taxpayer financed bonuses. Waters and her allies get tactical victory on this one.
  
• Congress did in fact let them have it this week. Tucked away in the American Recovery and Reinvestment Act of 2009 (the stimulus bill) is apparently a provision to reverse the IRS decision last fall to allow banks to write off losses from an acquired bank against future profits. If you might remember this was the provision that caused Wells to come back and bid on Wachovia after Citi had already agreed to take them. Though it was said by some that Congress could not do this, they have in fact done so and Obama will most likely sign it into law. This will have some big ramifications for the Wells - Wachovia deal as it is going to dramatically increase the cost of this merger. This might also affect BofA given the number of banks it has acquired.
  
  Proof enough that Congress can and will make retroactive changes to agreements whenever it sees fit.
  

[monsoon]

To add to the above, it also appears that Congress added provisions to severely limit bonuses that can be paid out to top traders and executives at banks receiving bailout money. This also is retroactive. Congress apparently did not buy the excuses on why these people should be paid so much and have clamped down on it. Not surprising some of the bank lobbyists are crying foul saying this will undermine the entire incentive structure at the banks.

I am wondering if the next step is to declare the recent payouts at ML illegal and then go after them.

[Commoner]

• ...Tucked away in the American Recovery and Reinvestment Act of 2009 (the stimulus bill) is apparently a provision to reverse the IRS decision last fall to allow banks to write off losses from an acquired bank against future profits. If you might remember this was the provision that caused Wells to come back and bid on Wachovia after Citi had already agreed to take them. Though it was said by some that Congress could not do this, they have in fact done so and Obama will most likely sign it into law. This will have some big ramifications for the Wells - Wachovia deal as it is going to dramatically increase the cost of this merger. This might also affect BofA given the number of banks it has acquired.
  
  Proof enough that Congress can and will make retroactive changes to agreements whenever it sees fit.
  

You do know that changing part of the Internal Revenue Code (or regulations promulgated thereunder) is not the same thing as making retroactive changes to agreements, right? I only bring it up because the last sentence looks like a continuation of last week's discussion regarding whether Congress has plenary power to unilaterally undo and reform agreements entered into by the U.S. government.

[monsoon]

^My posts about executive pay would be one if you don't accept the one about the IRS. i.e. they added additional terms to the existing TARP agreement to apply to the banks that have already taken the money. And, in regards to the IRS, I believe that might have been in the terms where Wells took over Wachovia because the Treasury was also involved.

[monsoon]

It's starting to sound as if Senators from both sides of the isle are concluding that several of the big banks, and presumably this includes BofA, will have to be shutdown. They have gone from "too big to fail" to "too big to succeed". There was also an article published early this weekend that predicts that BofA and Citigroup will not exist a year from now.

It sounds as if the plan would be for the government to move in, examine the bank books and if they decide the bank is insolvent to take it down instead of throwing more money at it. The account holders would be safe, but the shareholders would be completely wiped out. I am not sure what this might mean for employees and Charlotte, but I would expect they will do what they can to cut costs as much as possible.

[UrbanFuture]

It's starting to sound as if Senators from both sides of the isle are concluding that several of the big banks, and presumably this includes BofA, will have to be shutdown. They have gone from "too big to fail" to "too big to succeed". There was also an article published early this weekend that predicts that BofA and Citigroup will not exist a year from now.

It sounds as if the plan would be for the government to move in, examine the bank books and if they decide the bank is insolvent to take it down instead of throwing more money at it. The account holders would be safe, but the shareholders would be completely wiped out. I am not sure what this might mean for employees and Charlotte, but I would expect they will do what they can to cut costs as much as possible.

I hope your only source for the above comments was not the disturber article posted today about Lindsay Graham from SC. I trust you have done your research.

This action, while it ultimately might save us, the taxpayers, hundreds of billions in wasted future bailout bills loaded with pet projects, will completely change the face of Charlotte. Not from the obvious corporate presence standpoint, although the civic giving that the banks do will certainly be missed, but on a much more widespread community level. Significant portions of many Charlotte families wealth will be wiped out completely (not that they weren't worth obscenely less than they could've imagined already) in the greater Charlotte community, even if they are diversified.

Not to mention that this takes our country down a particularly dark alley between the streets of traditional American freedom and a hybrid form of socialism, even if it does eventually reincarnate our economy, it would set an astounding precedent in our country.

[monsoon]

I hope your only source for the above comments was not the disturber article posted today about Lindsay Graham from SC. I trust you have done your research......

Indeed. I am familiar with Graham's ability to get into the news and I did listen to him yesterday morning on This Week. However if you want a place to start, simply go to news.google.com and search on the phrase, "stress test".

I really don't think they know what to do except the original $350B didn't fix the problem, and there are some economists that are saying that it has delayed, and such made worse, the economic collapse. Congress is stuck between having to continue to throw staggering amounts of money at the banks and hope the CEOs will now do something constructive with it, or simply move in, take them over, break them up and give the parts to banks that have done a good job. The first option is hugely unpopular and as far as I know, the CEOs have not come up any plans for changing anything. So that leaves the take over. Which option makes sense?