Consolidation of Bailout Research

* Consolidated Research & Comments on the Bailout Draft *

Here are the findings and comments of DP users who have been reviewing the 106-pg bailout draft proposal (remember, this is STILL NOT YET a bill!), collected and presented in order by section for easy review.

Items entered here may show page number and/or section number; I hope I've got all the items in the correct order. If you notice something out of place, do let me know. Noted within each section are compilation and comment credits as applicable.

Text that is clearly commentary, I am putting in italics -- some commentary, however, is unable to be separated from text, due to the fact that the commentary is, in fact, a summation of what the text of the proposal says. I've also tried to reformat in order to keep the line numbers separated as much as possible.

Any sections not yet reviewed at the time of this posting will be added as they are completed and posted on the Time is limited thread.

***PLEASE NOTE*** There are a couple of entries put into cablenewsjunkie's thread that don't say where they belong -- these "orphan" entries can be found at the very bottom of this post. If you know where these belong, please advise and I'll get 'em in their proper places.

Thanks to all those doing the heavy leg work, and thanks to cablenewsjunkie for starting this project!

===================

PAGES 1 - 10

From cablenewsjunkie:
Page 1:

"To provide authority for the Federal Government to purchase
certain types of troubled assets for the purposes of providing
stability to and preventing disruption in the economy
and financial system and protecting taxpayers, and
for other purposes."

Oh boy. Here we go.

Page 3:

(2) to ensure that such authority and such facilities are used in a manner that—

(A) protects home values, college funds, retirement accounts, and life savings;

(B) preserves homeownership and promotes jobs and economic growth;

(C) maximizes overall returns to the taxpayers of the United States
(i.e. we're going to fire up the printing presses and Joe Sixpack won't know what happened until it's too late); and

(D) provides public accountability for the exercise of such authority.

Pages 5-6

(9) TROUBLED ASSETS.—The term ‘‘troubled
assets’’ means—
(A) residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before March 14, 2008, the purchase of which the Secretary determines promotes financial market stability; and
(B) øany other financial instrument that the Secretary, after consultation with the Chairman of the Board of Governors of the Federal Reserve System, determines the purchase of which is necessary to promote financial market stability, but only upon transmittal of such determination, in writing, to the appropriate committees of Congress¿.

Page 7

(B) CLERICAL AMENDMENT.—Section 5315 of title 5, United States Code, is amended in the item relating to Assistant Secretaries of the Treasury, by striking ‘‘(9)’’ and inserting ‘‘(10)’’.
(whatever that means)

also on Page 7 and 8

(c) NECESSARY ACTIONS.—The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation, the following:

(1) The Secretary shall have direct hiring authority with respect to the appointment of employees to administer this Act.

(2) Entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code.

(3) Designating financial institutions as financial agents of the Federal Government, and such institutions shall perform all such reasonable duties related to this Act as financial agents of the Federal Government as may be required.

Page 8

(d) PROGRAM GUIDELINES.—Before the earlier of the end of the 2-business-day period beginning on the date of the first purchase of troubled assets pursuant to the authority under this section or the end of the 45-day period beginning on the date of enactment of this Act, the Secretary shall publish program guidelines, including the following:
(1) Mechanisms for purchasing troubled assets.
(2) Methods for pricing and valuing troubled assets.
(3) Procedures for selecting asset managers.
(4) Criteria for identifying troubled assets for purchase.

Page 9

(e) PREVENTING UNJUST ENRICHMENT.—In making purchases under the authority of this Act, the Secretary shall take such steps as may be necessary to prevent unjust enrichment of financial institutions participating in a program established under this section, including by preventing the resale of a troubled asset to the Secretary at a higher price than what the seller paid to purchase the asset. This subsection does not apply to troubled assets acquired in a merger or acquisition, or a purchase of assets from a financial institution in conservatorship or receivership, or that has initiated bankruptcy proceedings under title 11, United States Code.

Page 10

(b) REPORTS.—The Secretary shall report to the appropriate committees of Congress on the program established under subsection (a). Such report shall be submitted prior to any increase in the authority to purchase troubled assets in accordance with section 115.
-------------------------------------------------------------------------------------
We are so screwed.

* Note from Sapphira re: Section 101:

Not being understood by the American people is that China is the holder
of over $1.4 Trillion of US debt backed by the mortgages on the homes
and property of tens of millions these people which, in essence, makes
the Chinese one of the largest holders of land in the United States, and
which the Chinese government has stated they will protect ‘at all
costs’.

In rapid response to China’s demands that they be granted immediate
access to their American properties to protect their ‘investments’, the
United States is enacting a new law titled the Emergency Economic
Stabilization Act of 2008, and which in Section 101, Paragraph 7:3
chillingly states:

Designating financial institutions as financial agents of the Federal Government, and such institutions shall perform all such reasonable duties related to this Act as financial agents of the Federal Government as may be required.

The United States Federal Reserve has further notified the China
Development Bank, the second largest bank in Asia and the main holder of
US mortgage debt instruments, that they will be designated by the US
Secretary of the Treasury as one of the financial institutions protected
by this extraordinary new law, and which, according to these reports,
will empower Chinese policing authorities the right to act as law
enforcement officers in the United States including granting them the
right to evict American citizens from homes whose mortgage debt is held
by China.

Unfortunately for these American people, their own public officials have
totally abandoned them as the American Center for Responsive Politics
has reported that the staggering amount of $2 Billion has been paid by
the perpetrators of this Global financial crisis to US Lawmakers, of
both political parties, to sell out their fellow countrymen as virtual
economic slaves to the all powerful International corporate cartels who
now rule over them.

...and adds this:

This is the reason why last week an announcement came out saying that China was halting lending to American banks and then within hours that was retracted.

From true_believer:
Yeah, they move section 8 to the very top of the document and gave paulison power over it right off the bat. unfreakin believable.

PAGES 11 - 20

From true_believer:
here - interesting part:
(3) MINIMUM LEVEL.—The premiums referred
10 to in paragraph (1) shall be set by the Secretary at
11 a level necessary to create reserves sufficient to meet
12 anticipated claims, based on an actuarial analysis
13 and to ensure that taxpayers are fully protected.

He gets to set the price so the taxpayer is protected. What are the odds of this happening? I mean what tax payer trust him to do this.

The wording on this is pretty confusing
ø(8) that nothing in this Act prevents the Sec20
retary from protecting the retirement security of
21 Americans by purchasing troubled assets held by or
22 on behalf of an eligible retirement plan other than
23 a plan described in section 409A of the Internal
24 Revenue Code of 1986; and¿

kind of interesting:
14 (2) TIMING.—The report required by this sub
15
section shall be submitted not later than 7 days

16 after the date on which commitments to purchase

17 troubled assets under the authorities provided in this

18 Act first reach an aggregate of $50,000,000,000 and

19 not later than 7 days after each $50,000,000,000 in
20
terval of such commitments is reached thereafter.

My question on this one does sunset go off before we the people knows where all these profits go (which they say to the debt how do we know that if sunset is off. Through ESP!) No sunset no knowy.
this next part even they have questions about

3 SEC. 106. RIGHTS; MANAGEMENT; SALE OF TROUBLED AS
4
SETS; REVENUES AND SALE PROCEEDS.

5 (a) EXERCISE OF RIGHTS.—The Secretary may, at

6 any time, exercise any rights received in connection with

7 troubled assets purchased under this Act.

8 ø(b) MANAGEMENT OF TROUBLED ASSETS.—The

9 Secretary, in consultation with the Corporation, shall have

10 authority to manage troubled assets purchased under this

11 Act, including revenues and portfolio risks therefrom.¿

12 (c) SALE OF TROUBLED ASSETS.—The Secretary

13 may, at any time, upon terms and conditions and at a

14 price determined by the Secretary, sell, or enter into secu
15
rities loans, repurchase transactions, or other financial

16 transactions in regard to, any troubled asset purchased

17 under this Act.

18 ø(d) TRANSFER OF A PERCENTAGE OF PROFITS.—

19 ¿

20 ø(1) DEPOSITS.—Not less than 20 percent of

21 any profit realized on the sale of each troubled asset

22 purchased under this Act shall be deposited as pro
23
vided in paragraph (2).¿

24 ø(2) USE OF DEPOSITS.—Of the amount re
25
ferred to in paragraph (1)—¿
22


O:\AYO\AYO08B94.xml [Discussion Draft]
<-- page separator

1 ø(A) 65 percent shall be deposited into the

2 Housing Trust Fund established under section

3 1338 of the Federal Housing Enterprises Regu
4
latory Reform Act of 1992 (12 U.S.C. 4568);

5 and¿

6 ø(B) 35 percent shall be deposited into the

7 Capital Magnet Fund established under section

8 1339 of that Act (12 U.S.C. 4569).¿

9 ø(3) TRANSFER TO TREASURY.—Revenues of,

10 and proceeds from the sale of troubled assets pur
11
chased under this Act, øor from¿ the sale, exercise,

12 or surrender of warrants or senior debt acquired

13 under section ø113¿ shall be paid into the general

14 fund of the Treasury for reduction of the public

15 debt.¿

These guys are sneaky little money grubbers. They always try to get around the corner while they are holding the money.

This whole thing is a nightmare. There is no reason a tax payer should even want to touch this thing. The only vote on this thing is a big fat no. non of my money. it wouldn't matter if it was the best document in the world its based on robbery.

PAGES 21 - 30

From Jon Kirkpatrick (emphases are Jon Kirkpatrick's):

page 21:

3 SEC. 106. RIGHTS; MANAGEMENT; SALE OF TROUBLED AS
4
SETS; REVENUES AND SALE PROCEEDS.

5 (a) EXERCISE OF RIGHTS.—The Secretary may, at

6 any time, exercise any rights received in connection with

7 troubled assets purchased under this Act.

and what are those rights?

8 ø(b) MANAGEMENT OF TROUBLED ASSETS.—The

9 Secretary, in consultation with the Corporation, shall have

10 authority to manage troubled assets purchased under this

11 Act, including revenues and portfolio risks therefrom.

12 (c) SALE OF TROUBLED ASSETS.—The Secretary

13 may, at any time, upon terms and conditions and at a

14 price determined by the Secretary, sell, or enter into secu

15 rities loans, repurchase transactions, or other financial

16 transactions in regard to, any troubled asset purchased

17 under this Act.

18 ø(d) TRANSFER OF A PERCENTAGE OF PROFITS.—

19 ¿

20 ø(1) DEPOSITS.— Not less than 20 percent of

21 any profit realized on the sale of each troubled asset

22 purchased under this Act shall be deposited as pro

23 vided in paragraph (2).
_______________________________

Page 22:

24 ø(2) USE OF DEPOSITS.—Of the amount re

25 ferred to in paragraph (1)—¿

ø(A) percent shall be deposited into the

2 Housing Trust Fund established under section

3 1338 of the Federal Housing Enterprises Regu

4 latory Reform Act of 1992 (12 U.S.C. 4568);

5 and¿

6 ø(B) 35 percent shall be deposited into the

7 Capital Magnet Fund established under section

8 1339 of that Act (12 U.S.C. 4569).¿

Does anyone know who these funds help?

9 ø(3) TRANSFER TO TREASURY.—Revenues of,

10 and proceeds from the sale of troubled assets pur

11chased under this Act, or from the sale, exercise,

12 or surrender of warrants or senior debt acquired

13 under section 113 shall be paid into the general

14 fund of the Treasury for reduction of the public

15 debt.

Who does this benefit?

16 (e) APPLICATION OF SUNSET TO TROUBLED AS
17
SETS.— The authority of the Secretary to hold any trou

18 bled asset purchased under this Act before the termination

19 date in section 120, or to purchase or fund the purchase

20 of a troubled asset under a commitment entered into be

21 fore the termination date in section 120, is not subject

22 to the provisions of section 120.

Must reference section 120. Sounds like more power.

PAGE 23

23 SEC. 107. CONTRACTING PROCEDURES.

24 (a) STREAMLINED PROCESS.—For purposes of this

25 Act, the Secretary may waive specific provisions of the
23 Federal Acquisition Regulation upon a determination that

2 urgent and compelling circumstances make compliance

3 with such provisions contrary to the public interest.
4 such determination, and the justification for such deter

5 mination, shall be submitted to the Committees on Over

6 sight and Government Reform and Financial Services of

7 the House of Representatives and the Committees on

8 Homeland Security and Governmental Affairs and Bank

9 ing, Housing, and Urban Affairs of the Senate within 7

10 days.

More power to do what he wants. In the interest of the public. At the same time sending the response to the people who got us in this mess for review.

11 (b) ADDITIONAL CONTRACTING REQUIREMENTS.—In

12 any solicitation or contract where the Secretary has, pur

13 suant to subsection (a) waived the provisions of the Fed

14 eral Acquisition Regulation pertaining to minority con

15 tracting, the Secretary shall develop and implement stand

16 ards and procedures to ensure, to the maximum extent

17 practicable, the inclusion and utilization of minorities (as

18 such term is defined in section 1204(c) of the Financial

19 Institutions Reform, Recovery, and Enforcement Act of

20 1989 (12 U.S.C. 1811 note)) and women, and minority

21 and women-owned businesses (as such terms are defined

22 in section 21A(r)(4) of the Federal Home Loan Bank Act

23 (12 U.S.C. 1441a(r)(4)), in that solicitation or contract,

24 including contracts to asset managers, servicers, property

1 managers, and other service providers or expert consult

2 ants.

3 (c) ELIGIBILITY OF FDIC.—Notwithstanding sub

4 sections (a) and (b), the Corporation—

5 (1) shall be eligible for, and shall be considered

6 in, the selection of asset managers for residential

7 mortgage loans and residential mortgage-backed se

8 curities; and

9 (2) shall be reimbursed by the Secretary for

10 any services provided.

PAGE 24

11 SEC. 108. CONFLICTS OF INTEREST.

12 (a) STANDARDS REQUIRED.—The Secretary shall

13 issue regulations or guidelines necessary to address and

14 manage or to prohibit conflicts of interest that may arise

15 in connection with the administration and execution of the

16 authorities provided under this Act, including—

17 (1) conflicts arising in the selection or hiring of

18 contractors or advisors, including asset managers;

19 (2) the purchase of troubled assets;

20 (3) the management of the troubled assets held;

21 (4) post-employment restrictions on employees;

22 and

23 (5) any other potential conflict of interest, as

24 the Secretary deems necessary or appropriate in the

25 public interest.


1 (b) TIMING.—Regulations or guidelines required by

2 this section shall be issued as soon as practicable after

3 the date of enactment of this Act.

This section states the secretary has powers to inforce regulations and guidelines based on his decisions about the following bullet points listed above. (More Power).

PAGE 25

4 SEC. 109. FORECLOSURE MITIGATION EFFORTS.

5 (a) RESIDENTIAL MORTGAGE LOAN SERVICING

6 STANDARDS.—To the extent that the Secretary acquires

7 mortgages, mortgage backed securities, and other assets

8 secured by residential real estate, including multifamily

9 housing, the Secretary shall implement a plan that seeks

10 to maximize assistance for homeowners and use the au

11 thority of the Secretary to encourage the servicers of the

12 underlying mortgages, considering net present value to the

13 taxpayer, to take advantage of the HOPE for Home

14owners Program under section 257 of the National Hous

15 ing Act or other available programs to minimize fore

16 closures. In addition, the Secretary may use loan guaran

17 tees and credit enhancements to facilitate loan modifica

18 tions to prevent avoidable foreclosures.

The above paragraph states that if you had bought a house you couldn't afford, we will help you.

19 (b) COORDINATION.—The Secretary shall coordinate

20 with the Corporation, the Board (with respect to any

21 mortgage or mortgage-backed securities or pool of securi

22 ties held, owned, or controlled by or on behalf of a Federal

23 reserve bank), the Federal Housing Finance Agency, the

24 Secretary of Housing and Urban Development, and other

25 Federal Government entities that hold troubled assets to

1 attempt to identify opportunities for the acquisition of

2 classes of troubled assets that will improve the ability of

3 the Secretary to improve the loan modification and re

4 structuring process and, where permissible, to permit bona

5 fide tenants who are current on their rent to remain in

6 their homes under the terms of the lease. In the case of

7 a mortgage on a residential rental property, the plan re

8 quired under this section shall include protecting Federal,

9 State, and local rental subsidies and protections, and en

10 suring any modification takes into account the need for

11 operating funds to maintain decent and safe conditions at

12 the property.

13 (c) CONSENT TO REASONABLE LOAN MODIFICATION

14 REQUESTS.—Upon any request arising under existing in

15 vestment contracts, the Secretary shall consent, where ap

16 propriate, and considering net present value to the tax

17 payer, to reasonable requests for loss mitigation measures,

18 including term extensions, rate reductions, principal write

19 downs, increases in the proportion of loans within a trust

20 or other structure allowed to be modified, or removal of

21 other limitation on modifications.

More power listed above. Nothing out of the norm or written weird.

PAGES 26 - 31

22 SEC. 110. ASSISTANCE TO HOMEOWNERS AND LOCALITIES.

23 (a) DEFINITIONS.—As used in this section—

24 (1) the term ‘‘Federal property manager’’

25 means—

27

1 (A) the Federal Housing Finance Agency,

2 in its capacity as conservator of the Federal

3 National Mortgage Association and the Federal

4 Home Loan Mortgage Corporation;

5 (B) the Corporation, with respect to resi

6 dential mortgage loans and mortgage-backed se

7 curities held by any bridge depository institu

8 tion pursuant to section 11(n) of the Federal

9 Deposit Insurance Act; and

10 (C) the Board, with respect to any mort

11gage or mortgage-backed securities or pool of

12 securities held, owned, or controlled by or on

13 behalf of a Federal reserve bank;

14 (2) the term ‘‘consumer’’ has the same meaning

15 as in section 103 of the Truth in Lending Act (15

16 U.S.C. 1602);

17 (3) the term ‘‘insured depository institution’’

18 has the same meaning as in section 3 of the Federal

19 Deposit Insurance Act (12 U.S.C. 1813); and

20 (4) the term ‘‘servicer’’ has the same meaning

21 as in section 6(i)(2) of the Real Estate Settlement

22 Procedures Act of 1974 (12 U.S.C. 2605(i)(2)).

23 (b) HOMEOWNER ASSISTANCE BY AGENCIES.—

24 (1) IN GENERAL.—To the extent that the Fed
25
eral property manager holds, owns, or controls mort

28 gages, mortgage backed securities, and other assets

2 secured by residential real estate, including multi

3 family housing, the Federal property manager shall

4 implement a plan that seeks to maximize assistance

5 for homeowners and use their authority to encourage

6 the servicers of the underlying mortgages, and con

7 sidering net present value to the taxpayer, to take

8 advantage of the HOPE for Homeowners Program

9 under section 257 of the National Housing Act or

10 other available programs to minimize foreclosures.
11 (2) MODIFICATIONS.—In the case of a residen

12 tial mortgage loan, modifications made under para

13 graph (1) may include—

14 (A) reduction in interest rates;

15 (B) reduction of loan principal; and

16 (C) other similar modifications.

17 (3) TENANT PROTECTIONS.—In the case of

18 mortgages on residential rental properties, modifica

19 tions made under paragraph (1) shall ensure—

20 (A) the continuation of any existing Fed

21 eral, State, and local rental subsidies and pro

22 tections; and

23 (B) that modifications take into account

24 the need for operating funds to maintain decent

25 and safe conditions at the property.

29

Above paragraphs explain definitions.

1 (4) TIMING.—Each Federal property manager

2 shall develop and begin implementation of the plan

3 required by this subsection not later than 60 days

4 after the date of enactment of this Act.

5 (5) REPORTS TO CONGRESS.—Each Federal

6 property manager shall, 60 days after the date of

7 enactment of this Act and every 30 days thereafter,

8 report to Congress specific information on the num

9 ber and types of loan modifications made and the

10 number of actual foreclosures occurring during the

11 reporting period in accordance with this section.

This paragraph above states the federal property manager will report to congress about the changes it has made to home loans. (Reducing intrest, principle, etc).

12 (6) CONSULTATION.—In developing the plan re

13 quired by this subsection, the Federal property man

14 agers shall consult with one another and, to the ex

15 tent possible, utilize consistent approaches to imple

16 ment the requirements of this subsection.

17 (c) ACTIONS WITH RESPECT TO SERVICERS.—In any

18 case in which a Federal property manager is not the owner

19 of a residential mortgage loan, but holds an interest in

20 obligations or pools of obligations secured by residential

21 mortgage loans, the Federal property manager shall—

22 (1) encourage implementation by the loan

23 servicers of loan modifications developed under sub

24 section (b); and
30
1 (2) assist in facilitating any such modifications,

2 to the extent possible.

3 (d) LIMITATION.—The requirements of this section

4 shall not supersede any other duty or requirement imposed

5 on the Federal property managers under otherwise appli

6 cable law.

Nothing to fishy stated above, decent provisions at least.

PAGE 30

7 SEC. 111. EXECUTIVE COMPENSATION AND CORPORATE

8 GOVERNANCE.

9 (a) DIRECT PURCHASES.—

10 (1) IN GENERAL.—Where the Secretary deter

11 mines that the purposes of this Act are best met

12 through direct purchases of troubled assets from an

13 individual financial institution where no bidding

14 process or market prices are available, and the Sec

15 retary receives a meaningful equity position in the

16 financial institution as a result of the transaction,

17 the Secretary shall require that the financial institu

18 tion meet appropriate standards for executive com

19 pensation and corporate governance. The standards

20 required under this subsection shall be effective for

21 the duration of the period that the Secretary holds

22 an equity position in the financial institution.

23 (2) CRITERIA.—The standards required under

24 subsection shall include—

This is stating that the secretary can basically give out compensation to the executives for a sale in assets, it seems like the standards at which these are applied are in the following section. It also seems time based.

-- [END OF PAGE; SEE PAGES 31-40] --

PAGES 31 - 40

From healthnut4freedom:
Pages 31 to 40 have so much legal gobblydy goop I am not sure I understand it. Never did like studying law.

It has to do with not allowing compensation of executives of companies that are taken over by the government under this law.

What troubled me was this paragraph. Help me out here. Does this mean that any company that they bail out with less than $300 billion for just that company is exempt from the executive compensation clause? Whenever they are referring to the employer it is defined as "Applicable Employer."

APPLICABLE EMPLOYER.—For pur
11
poses of this paragraph—

12 ‘‘(i) IN GENERAL.—Except as pro
13
vided in clause (ii), the term ‘applicable

14 employer’ means any employer from whom

15 1 or more troubled assets are acquired

16 under a program established by the Sec
17
retary under section 101(a) of the Eco
18
nomic Recovery and Corporate Account
19
ability Act of 2008 if the aggregate

20 amount of the assets so acquired for all

21 taxable years exceeds $300,000,000

PAGES 41 - 50

From MikeLawson:
Pages 41-50 mostly deal with purcahsing and selling assets and the "golden parachutes". Interestingly, the definitions section negates the entire section about golden parachutes by stating

"If a payment

19 which is treated as a parachute payment

20 by reason of this subsection is also a para
21
chute payment determined without regard

22 to this subsection, this subsection shall not

23 apply to such payment."

So as long as the payment was not for selling or buying these specific assets it is permissible. The rest simply says that the secrtary may purchase assetts from companies valued over 100,000,000 but may never have any more than 250billion outstanding without presidential approval. With that approval the value of the assets purchased may be 350 billion at any given time.

In response, from Jon Kirkpatrick:
It doesn't state that the limited is raised, it says per that paragraph, or rather the lack of, that another 350 billion can be applied. Same with the paragraph after that.

PAGES 51 - 60

From Swifty (emphases are Swifty's):

Pages 50-51 -- AT ANY ONE TIME!
SEC. 115. GRADUATED AUTHORIZATION TO PURCHASE.

10 (a) AUTHORITY.—The authority of the Secretary to

11 purchase troubled assets under this Act shall be limited

12 as follows:

13 (1) Effective upon the date of enactment of this

14 Act, such authority shall be limited to

15 $250,000,000,000 outstanding at any one time.
16 (2) If at any time, the President submits to the

17 Congress a written certification that the Secretary is

18 exercising the authority under this paragraph, effec-

19 tive upon such submission, such authority shall be

20 limited to $350,000,000,000 outstanding at any one

21 time.

22 (3) If at any time after obligations of amounts

23 described in paragraphs (1) and (2) have been made,

24 the President transmits to the Congress a written

25 report detailing the plan of the Secretary to exercise
51


[Discussion Draft]
<-- page separator

1 the authority under this paragraph, unless there is

2 enacted, within 15 calendar days of such submission,

3 a joint resolution described in subsection (c), effec-

4 tive upon the expiration of such 15-day period, such

5 authority shall be limited to $700,000,000,000 out-

6 standing at any one time.


This is not limited to $700,000,000,000 at all, please note that AT ANY ONE TIME is still there.

---

From fringeNOT in response to Swifty:
So it's NOT a debt total, just a revolving debt number that allows UNLIMITED payments to bad companies as long as the 15 day maximum is maintained. Like a $700 billion credit card! Implication >
"US conversion to central government planning, otherwise known as Communism"

---

From Swifty, responding to fringeNOT:
Not quite - read this section again:
the authority under this paragraph, unless there is
2 enacted, within 15 calendar days of such submission,
3 a joint resolution described in subsection (c), effec-
4 tive upon the expiration of such 15-day period, such
5 authority shall be limited to $700,000,000,000 out-
6 standing at any one time.

This bill enables further bailouts limited only by the oversight of those who brought you the Patriot Act, Real-ID, Iraq war, Homegrown Terrorism Act..... (and so on)

---

From NCMarc:
page 51 talks about the 700,000,000,000 and the 2 paragraphs before it. it seems like they are willing to spend 250 B then 350B and then 700B all together totallying 1.4T.? but it also says "AT ANY ONE TIME" so what the fuck?

---
From tamtamfreedom:
Increase in the Statutory limit on the public debt to...drum roll please...$11,315,000000,000. How's that feel?

---

From true_believer:
Where did you get this number out of the document?

---

From Jon Kirkpatraick:
Page 51, it gives the president the authority to increase it to that.

---

From true_believer:
Wow - well there went all the incentive for my children to work hard. They will be just like my parents and my generation now in debt for life. I have worked hard my whole life. I have been layed of for 8 months now (I've never been out of work before). I have been complaining to my boss for the last 10 years about the size houses we have been building. Like l million $ houses for teachers and 2 million $ houses for mechanic workers. I've had builders tell me that most people who move into these homes once they move in can't even afford the draps for the windows. Most of these houses have around 50 windows in the house. I have been telling builder we were in trouble along time now they always say hey at least we got the work you should be happy. I would tell them I would rather have steady work for my lifetime. People should be living within their means. I don't know If I realy feel like working and destroying my body only to have half of my income robbed from me. Even if the economy gets better I don't know if I can stand to work in this system any more. I work to hard to have these kind of people end up with my hard earned money. They set on their ass all day and set up at there long table and act like the power is theirs. If they have the power why don't they pay for all this garbage. I feel like if these people killed someone I would get half the blame. I am losing my love for this government and my desire to finance it anymore. I love my country but to me country is the land and the people not its rulers. that is what these people think they are rulers. They have been totally corrupted by rubbing the elbows of Europe and making deals with dictators. These people with a stroke of a pen in the last 2 weeks have indebted my children for their entire existance on this planet and then they get on camara and say we need "it" I think they mean we (bankers) need it (your money) and I think they mean we (the people) need it (bondage). I always new the enbrassing of socialism was going to bit us on the tail.

---

Jon Kirkpatric says:
9 SEC. 115. GRADUATED AUTHORIZATION TO PURCHASE.

10 (a) AUTHORITY.—The authority of the Secretary to

11 purchase troubled assets under this Act shall be limited

12 as follows:

13 (1) Effective upon the date of enactment of this

14 Act, such authority shall be limited to

15 $250,000,000,000 outstanding at any one time.

16 (2) If at any time, the President submits to the

17 Congress a written certification that the Secretary is

18 exercising the authority under this paragraph, effec

19 tive upon such submission, such authority shall be

20 limited to $350,000,000,000 outstanding at any one

21 time.

22 (3) If at any time after obligations of amounts

23 described in paragraphs (1) and (2) have been made,

24 the President transmits to the Congress a written

25 report detailing the plan of the Secretary to exercise
51


[page delineation]

1 the authority under this paragraph, unless there is

2 enacted, within 15 calendar days of such submission,

3 a joint resolution described in subsection (c), effec

4 tive upon the expiration of such 15-day period, such

5 authority shall be limited to $700,000,000,000 out

6 standing at any one time.

Wow. Basically the president can write two letters and BAM! They have the power to increase spending on the spot. And that "any one time." And it doesn't say it replaces the existing amount, it assumes that it is an increase in spending.

From Republican Liberty:
Pgs. 51 - 60, sec. 115 and 116 [Numbering seems off, here]

51-60
Sec. 115 –Graduated Authority to Purchase

1. Secretary of Treasury has single purchase limit of $250 million or $350 million with consent of the President

2. Anytime the above limits are reached, the limit of the plan can automatically be increased to $700 Million by the Presidents written request to Congress.

3. The Presidents increase above the $350 Million shall be automatically granted unless there is a resolution from congress against the increase. The rules for passing such a resolution are spelled out and very strict.
(Note: this limit becomes automatic unless congress stops it within 15 days. It will be sent to a financial services committee to determine)

3. Describes the complex rules under which congress shall abide by to stop the spending of money if desired by presidential authority. Debate shall be limited to 10 hours.After debate there shall be an immediate vote. The issue shall not be referred to committee.

Sec. 116 Oversights and Audits.
The GAO shall review and audit all portions of this act and shall be reimbursed for cost associated with this audit from the treasury.

PAGES 60 - 80

From rogerhermann:
I read 60-80 and it is so loose and vague.
The way it is written leaves so much open to interpretation. The appointment of a special inspector by the President to oversee what is going on with the qualities of integrity and accounting skills. This is Washington speak for investment banker with ties to the existing criminal sindicate. BTW he well have a 75,000,000 dollar budget for his work. Can you spell PORK. They also raise the debt ceiling to about 11.5 trillion. Generally the text is hoplessly vague and can be interpreted anyway you want.

*+* FOLLOWING PAGES TBD, BUT PROBABLY 71-80 *+*

From s.tristero:

Some additional comments on secs 128 - 131

sec 128 - ACCELERATION OF EFFECTIVE DATE
so basically as of this wednesday, the Fed will not only pay interest to its member banks on their reserves but allow them to maintain a zero reserve ratio, meaning that they no longer have to have any reserves with the Fed to operate...none, nil, zilch.

this means that the member banks will legally be allowed to operate, even if they're technically 'bankrupt'.

this also includes the 2 new member banks - Morgan Stanley & Goldman Sachs who were allowed in last week when Bernanke waived the 30 day waiting period.

btw, this was originally supposed to into law 3 years from now.

sec 129 - DISCLOSURES
(c) CONFIDENTIALITY - upon request of the Chairman of the Board, all information above will be held confidential and only available to the chairperson and ranking members of the committees (and according to subsection e, the Congressional Oversight Board).

(meaning not available to other members of Congress or the public)
(so much for transparency -- they're gonna keep the secrets 'all in the family', likely 12 members of Congress maximum.)

sec 131 - EXCHANGE STABILIZATION FUND REIMBURSEMENT
this one is interesting: Secretary has to reimburse this fund for the recent money market guarantees and protects the fund from any further losses by prohibiting the Secretary from using the fund to guarantee the money markets.
from: http://en.wikipedia.org/wiki/Exchange_Stabilization_Fund
note: the fund was originally created out of the profits the govt made from seizing the gold of US citizens in 1934 then jacking up the price.
what this one does is shackle Treasury from using it in the future for anything else than what its designed for -- to manipulate exchange rates without the help of the Fed.

looks like Henry overstepped his bounds on this one. perhaps 'they' (Obama & his boys) realize they're gonna need as much as dough as possible to prop up the dollar.

get ready for the replay of the FDR gambit that created the fund in the 1st place.

i'm researching sec 130 a bit more -- the Truth in Lending changes
i have a hunch there's some sneaky sinister lurking beneath the legalese.

*+*+*+*

PAGES 81 - 90

From LibBerte:

When it looked like you couldn't get to it, I jumped in and took a look.
Pages 80-90 of the Draft appears to contain 2 somewhat mundane provisions:

----- Creates a Congressional Oversight Panel of 5 members appointed by House and Senate majority and minority leadership to report on the benefits of Treasury Secretary actions every 30 days and prepare a Special Report on Regulatory Reform no later than January 20:

"... analyzing the current state of the regulatory system and its effectiveness at overseeing the participants in the financial system, protecting consumers, and providing recommendations for improvement including recommendations regarding whether any participants in the financial markets that are currently outside the regulatory system should become subject to the regulatory system and the rationale underlying such recommendation and whether there are any gaps in existing consumer protections."

It is not clear from the pages I reviewed whether these referenced "participants" include only those big financial houses, hedge funds, and banks that own and control the clearing system DTCC (referred to as 'the participants'.)

It would be best for the goals of transparency and reform that the scope of any reports and recommendations be without limitation. Further, I believe it would be helpful to include in the legislative history an amendment to broaden the scope of the report and recommendations called for to include an intent to promote the widest enforcement effort possible -- encouraging the entire regulatory scheme of private civil remedies and state administrative agencies without any intent to federally preempt the field. In other words, it should be made clear that the recommendations are aimed at creating a nonexclusive regulatory scheme of federal enforcement. Sliding such a change in here could have a huge effect against predatory securities law poachers who have enjoyed a happy hunting ground with no bag limit because they have had such a cozy relationship with the federal game wardens who relieved them of any worry about local hunting licensing or rules. Specifically, the Bush administration has used obscure OCC involvement as a basis to force State administrative agencies to stand down from illegal mortgage practices enforcement within their borders. More egregiously, numerous federal cases alleging a broad array of fraudulent actions have been routinely dismissed under the theory that the SEC stock borrow program was intended to be a comprehensive enforcement scheme to the exclusion of other remedies and, therefore federally preempting the field. This has left injured parties without a remedy, and fraudulent law violators to enjoy their ill gotten gains with impunity, when federal regulators refused to enforce their own rules governing naked short selling, for example.
Simply stated, language inserted at this stage to provide a mandate to this panel for recommendations as to how best to remove impediments to state and federal( civil, criminal, and administrative) enforcement efforts may promote the broadest remedies against law violators.

------------ The other significant provision in this section simply clarified that it is illegal to claim that a deposit or investment is FDIC insured if it is not.

PAGES 90 - 100

From GaleRazorwind:
I'm looking at 90-100 right now. I have seen one gramatical error. Page 93, line 7/8, "...the period beginning on March 1, 2008 and ending
8 ON THE AFTER THE date of enactment of this Act..." (emphasis mine).

I am not familiar with the rest of the bill, but this statement worries me a little bit. I tried to keep the formating as intact as possible. Look at subseciton b.

pg. 95
SEC. 132. SUSPENSION OF MARK-TO-MARKET ACCOUNTING.
23 (a) AUTHORITY.—The Securities and Exchange Com

24 mission shall have the authority under securities laws (as

25 such term is defined under section 3(a)(47) of the Securi

pg.96 <-- page delineation

1 ties Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to sus

2 pend, by rule, regulation, or oder, the application of State

3 ment Number 157 of the Financial Accounting Standards

4 Board for any issuer (as such term is defined in section

5 3(a)(8) of such Act) or with respect to any class or cat

6 egory of transaction if the Commission determines that

7 is necessary or appropriate in the public interest and is

8 consistent with the protection of investors.

9 (b) SAVINGS PROVISION.—Nothing in subsection (a)

10 shall be construed to restrict or limit any authority of the

11 Securities Exchange Commission under securities laws as

12 in effect on the date of enactment of this Act.

In other words, regardless of what it may read in ss A, ss A could potentially be rendered null and void by the fact that "Nothing in subsection (a) shall be construed to restrict or limit any authority etc..".

hmm in the next section it talks about a study on several things, but there is, of course, no mention of investigating the fed's hand in causing these failures in the first place.

Towards the bottom of page 98:

7 SEC. 135. PRESERVATION OF AUTHORITY.

8 With the exception of section 131, nothing in this Act

9 may be construed to limit the authority of the Secretary

10 or the Board under any other provision of law.

That is another potential loophole for sidestepping pretty much anything in the bill, as far as I can tell.

Those are the lines that jumped out at me for pages 90-100.

PAGE 92

From rhino:
So much for transparancy...Palosi said every transaction would be posted on the internet within 48 hours.

(To be honest the whole process of disecting the bill should only be used to try to wake people up. The bill should be opposed on principle alone.)

Let me copy the text here:

(c) CONFIDENTIALITY.—The information submitted

24 to the Congress under this section may be kept confiden
25
tial, upon the written request of the Chairman of the


93
O:\AYO\AYO08B94.xml [Discussion Draft]
<-- page delineation

1 Board, in which case it shall made available only to the

2 Chairpersons and Ranking Members of the Committees

3 described in subsection (a).

4 (d) APPLICABILITY.—The provisions of this section

5 shall be in force for all uses of the authority provided

6 under section 13 of the Federal Reserve Act occurring

7 during the period beginning on March 1, 2008 and ending

8 on the after the date of enactment of this Act, and reports

9 described in subsection (a) shall be required beginning not

10 later than 30 days after that date of enactment, with re
11
spect to any such exercise of authority.

12 (e) SHARING OF INFORMATION.—Any reports re
13
quired under this section shall also be submitted to the

14 Congressional Oversight Panel established under section

[THIS SEEMS TO STOP SHORT]

From dlind (emphases belong to dlind):

Pages 91-100

Page 91

16 SEC. 128. ACCELERATION OF EFFECTIVE DATE.
17 Section 203 of the Financial Services Regulatory Re-
18 lief Act of 2006 (12 U.S.C. 461 note) is amended by strik-
19 ing ‘‘October 1, 2011’’ and inserting ‘‘October 1, 2008’’.

According to my research of the Financial Services Regulatory Relief Act of 2006 this would mean that effective immediately the Federal Reserve Act would be amended to: (1) authorize payment of interest on funds maintained by a depository institution at a Federal Reserve bank; and (2) authorize the Federal Reserve Board to reduce to 0% the reserves required to be maintained by a depository institution against its transaction accounts. (The current requirement ranges from 3% to 14%.)

That second part sounds pretty sketchy to me, but what do I know.

Page 92

14 (b) PERIODIC UPDATES.—The Board shall provide
15 updates to the Committees specified in subsection (a) not
16 less frequently than once every 60 days while the subject
17 loan is outstanding, including—
18 (1) the status of the loan;
19 (2) the value of the collateral held by the Fed-
20 eral reserve bank which initiated the loan; and
21 (3) the projected cost to the taxpayers of the
22 loan.
23 (c) CONFIDENTIALITY.—The information submitted
24 to the Congress under this section may be kept confiden-
25 tial, upon the written request of the Chairman of the

Page 93

1 Board, in which case it shall made available only to the
2 Chairpersons and Ranking Members of the Committees
3 described in subsection (a).

Bullshit! Every taxpayer ought to have the right to look at those numbers considering we're all essentially shareholders, and at the very least ALL of our elected representatives in congress should be able to get a hold of them so that they can pull the BS alarm if and when this thing starts getting out of control.

Page 95

5 SEC. 131. EXCHANGE STABILIZATION FUND REIMBURSE-
6 MENT.
7 (a) REIMBURSEMENT.— The Secretary shall reim-
8 burse the Exchange Stabilization Fund established under
9 section 5302 of title 31, United States Code, for any funds
10 used for the temporary guaranty program for the United
11 States money market mutual fund industry, from funds
12 under this Act.
13 (b) LIMITS ON USE OF EXCHANGE STABILIZATION
14 FUND.— The Secretary is prohibited from using the Ex-
15 change Stabilization Fund for the establishment of any
16 future guaranty programs for the United States money
17 market mutual fund industry.
18 (c) CONSULTATIONS.—In carrying out any guarantee
19 program, the Secretary shall consult with the Board of
20 Directors of the Corporation and the Securities and Ex-
21 change Commission.

Section a) and b) sound ok to me they basically say you can't use the Exchange Stabilization Fund to prop up money markets any more, and you have to pay back what you took out of it over the past few weeks. C), on the other hand, seems a little bit pointless... as if those jerks are going to have different opinions on anything.

Page 95

22 SEC. 132. SUSPENSION OF MARK-TO-MARKET ACCOUNTING.
23 (a) AUTHORITY.—The Securities and Exchange Com-
24 mission shall have the authority under securities laws (as
25 such term is defined under section 3(a)(47) of the Securi

Page 96

1 ties Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to sus-
2 pend, by rule, regulation, or oder, the application of State-
3 ment Number 157 of the Financial Accounting Standards
4 Board for any issuer (as such term is defined in section
5 3(a)(8) of such Act) or with respect to any class or cat-
6 egory of transaction if the Commission determines that
7 is necessary or appropriate in the public interest and is
8 consistent with the protection of investors.
9 (b) SAVINGS PROVISION.—Nothing in subsection (a)
10 shall be construed to restrict or limit any authority of the
11 Securities Exchange Commission under securities laws as
12 in effect on the date of enactment of this Act.

Securities Exchange Act of 1934
Statement Number 167 of the Financial Accounting Standards Board [PDF]

As I'm just a dumb computer science student unskilled in the ways of this junk I've posted links to the acts referenced in this section for other people to look at and try and make sense of. As far as I can tell, this act simply suspends the practice of Mark-To-Market accounting. Which in and of itself might not be a bad idea, but anytime I hear depression era legislation being referenced, and language like 'in the public interest and is consistent with the protection of investors' my BS alarm goes off.

Page 97

19 SEC. 134. RECOUPMENT.
20 Upon the expiration of the 5-year period beginning
21 upon the date of the enactment of this Act, the Director
22 of the Office of Management and Budget, in consultation
23 with the Director of the Congressional Budget Office, shall
24 submit a report to the Congress on the net amount within
25 the Troubled Asset Relief Program under this Act. In any

Page 98

1 case in which there is a shortfall, the President shall sub-
2 mit to the Congress a legislative proposal that recoups
3 from entities benefitting from the program an amount
4 equal to the shortfall in order to ensure that the Troubled
5 Asset Relief Program does not add to the budget deficit
6 or the national debt.

Supposedly if we, the taxpayers, get screwed royally by all of this then the President will come up with a super smart plan to get our losses back from the companies we helped. I give congress an A+ for passing the buck on this one, but I've really got no clue as to how they're going to go about doing this without causing a massive headache in 5 years.

From billyjack1958:
Section 201, page 98 talks about oversight. It sounds as though it is meant to negate Section 8?

PAGES 103 - 106

From mizrae:
I'm trying to read pages 101 thru 106 and it keeps referring to the "Federal Credit Reform Act of 1990". (http://www.usaid.gov/poli...) From the Cornell University Law School, there is a list of revisions to this Act - including the following:

In subsection (a), the word “President” is substituted for “Office of Management and Budget” because sections 101 and 102(a) of Reorganization Plan No. 2 of 1970 (eff. July 1, 1970, 84 Stat. 2085) designated the Bureau of the Budget as the Office of Management and Budget and transferred all functions of the Bureau to the President. The word “assistance” is substituted for “aid”, and the word “receipts” is substituted for “revenue”, for consistency in the revised title.

Are we being bamboozled again? I'm still trying to look up Section 123/110 from the aforementioned 1990 Act, so reading through this is going to take awhile.

********************************************

"LITTLE ORPHAN ENTRIES" ;) -- Please help determine where these belong (if at all) in the above consolidation:

From Lysa:
Has anyone checked Section 8 which originally said
"Decisions by the Sec'y pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and MAY NOT BE REVIEWED BY ANY COURT OF LAW or any administrative agency."???

From treadwayca:

Case in point..."To provide authority for the Federal Government to purchase certain types
of troubled assets for the purposes of providing stability to and preventing
disruption in the economy and financial system and protecting
taxpayers, and for other purposes."
The people give those idiots authority—not some flimsy measure worked out by clueless knuckleheads behind closed doors over pizza and coffee. At least 80% of the nation (the citizens who are supposed to give these good-for-nothing dingbats authority) is opposed to this measure.
The dunderheads "working" (term used loosely) on this clearly don't understand economics.
This contains quite a few earmarks (surprise surprise surprise).
Cliff Treadway, Sioux City, Iowa

And a response to treadwayca from trout007:
What's a troubled asset?
(9) TROUBLED ASSETS.—The term ‘‘troubled assets’’ means
(B) Any other financial instrument that the Secretary, after consultation with the Chairman of the Board of Governors of the Federal Reserve System, determines the purchase of which is necessary to promote financial market stability, but only upon transmittal of such determination, in writing, to the appropriate committees of Congress.
OK so they can buy whatever the Secretary and Fed wants?

From LionandLambMinstry:
(b) MEMBERSHIP.—The Financial Stability Over
5sight Board shall be comprised of—
6 (1) the Chairman of the Board of Governors of
7 the Federal Reserve System;
8 (2) the Secretary;
9 (3) the Director of the Federal Home Finance
10 Agency;
11 (4) the chairman of the Securities and Ex12
change Commission; amd
13 (5) the Secretary of Housing and Urban Devel14
opment.
15 (c) CHAIRPERSON.—The chairperson of the Financial
16 Stability Oversight Board shall be elected by the members
17 of the Board from among the members.
WHAT?!?!?!?!?!?!!?!
In Christ,
Dave

From true_believer:
yeah they move section 8 to the very top of the document
and gave paulison power over it right off the bat. unfreakin believable.