posted on Sep, 29 2008 @ 08:57 AM
Looks like a part of the bill is saying, in regards to the toxic paper that is going to be sold to the .gov , that the .gov will not pay more than the
institution selling it to the .gov bought it for except in cases of buyouts or mergers. So it looks like C and JPM will sell any toxic paper
from Wachovia and WaMu respectively at a profit to the government. Hence the rapid canibalization of two of the largest US thrifts.
I'm not saying WaMu and Wachovia were in good shape, I'm just saying that the takedown of both of these over what a 5 day period, shows that the
"favored few" knew that they'd be able to cannibalize these banks and pass the bad debt on to the taxpayer at a handy profit.
It's looking like the favored few are these banks: JPMorgan/chase (JPM), Bank of America (BAC), Cititgroup (C) are definately on the Favored List I
also think Goldman Sachs is there too and maybe Morgan Stanley (MS).
So where does that leave some of the larger non favored institutions? Will similar events happen to them as they are gobbled up by the favored? Of
most interest are: Wells Fargo (WFC), US Bancorp (USB), and Suntrust (STI).
Goldman and Morgan Stanley since they have recieved permission to be bank holding companies will most likely need to acquire a bank with brick and
mortar location. With Buffet buying in to GS (and talking his book with his support for the bailout BTW) I'd think that GS may acquire Wells or USB
given Buffet's stakes in those institutions.