I guess the credit crisis isn’t that bad after all, because according to this report, Wall Street is about to say “Thanks, but no thanks” to the bailout:
Fears are mounting that many Wall Street banks and financial firms will refuse to participate in the US government’s $700bn bail-out package, leaving global markets and world economies in a perilous state for months to come.
‘There is a growing feeling that banks … might instead decide to tough it out,’ said Thomas Caldwell, chairman and CEO of Caldwell Financial, a $1bn-plus fund manager.
For the past two weeks all eyes in the market have been focused on US Congress and its attempts to pass Treasury Secretary Henry Paulson’s bail-out package – a bill to allow the US government to buy up to $700bn of toxic mortgage-related assets from American banks, which would in theory free the credit markets and set the gears of global commerce spinning once more.
Why might they decide to let things go down the tube rather than take the help? According to the story, the same greed that helped get us into this position:
But Wall Street analysts, believe the addition of so many terms to the bill might deter potential participants.
One of the least attractive elements is a section designed to curb executive pay at banks that participate in the bail-out package. These include limiting stock-related pay and banning ‘golden parachutes’ for executives.
‘I think this hodge-podge of regulations and rules will be enough to put many [chief executives] off participating,’ Caldwell said.
Sources close to Goldman Sachs and Merrill Lynch indicated the banks might choose not to participate in the bail-out as there is a growing view on Wall Street that the market may be bottoming out.
Charming. But, on the upside, if the market is bottoming out and they don’t need to take taxpayer money, I support it. If they are wrong, and bring about financial armageddon due to sheer greed, well, at least we know who to blame.
We’ll just file this under “country first.” I pray to the all-knowing FSM that either this report is wrong or Wall Street is right about the market having already bottomed out.