Just released from Reuters.
Washington Mutual filed for Chapter 11 bankruptcy protection from creditors today in Wilmington, DE.
http://www.reuters.com/article/ousiv/idUSTRE48Q09Y20080927
DelMarVa's Premier Source for News, Opinion, Analysis, and Human Interest Contact Publisher Joe Albero at alberobutzo@wmconnect.com or 410-430-5349
why rob liquor stores?, because the banks aint got no money.
ReplyDeleteYou can not sustain a nation from only the housing market. There must be manufacturing as a base to the economy. We have lost our manufacturing plants over the years, these are the same manufacturing plants that help us win the second world war. As a nation we must find a way to draw the big manufacturers back, or create new plants with new technology to lead a new manufacturing base into the future. Its clear to me that the global free trade agremments back-fired on us. Who-ever made these agreements must of been drunk or bought or both. This bail-out is not going to replace the manufacturing plants lost or the millions of living wage jobs that have been eliminated from our economy. I say no to a bail-out plan. Let the chips fall where they will and we will ride it out. Remeber we are AMERICANS and we as a nation and as a collective group of people have come threw alot, we will make it threw this as well. Remember what makes us who we are isnt our cars, our houses, our clothes or any of the extras in life. What makes us what we are is the people that we love and the people who love us. Nothing else matters.
ReplyDeleteAre still a free country?
ReplyDeleteFrom Nutzworld
While the markets were closed, and the Chairman of Washington Mutual was on a flight from New York to Seattle, the largest theft in US history took place. Although there has been negative news about the financial stocks for the past few months, including Washington Mutual,the FDIC and Washington Mutual repeated assurances that the bank was in good shape through 2010 over and over and the fact that WaMu met it's daily requirements. If that is the case, the seizure and immediate for profit sale of WAMU to JP Morgan Chase raises many questions.
This isn't so much about the failure of WAMU, as that may have happened eventually anyway, but suddenly the FDIC has become a for profit institution taking over and selling off a company for 1.9 Billion dollars. This is unprecedented in many ways, and in many ways probably illegal. The shareholders own WAMU, not the FDIC. Yes, the FDIC regulates banking, however shareholders own the company. WAMU could have literally gone bankrupt and sold off chairs, computers, land etc and shareholders would have received some portion of compensation. In this seizure, Chase gets the assets and deposits at a bargain, the FDIC gets 1.9 Billion dollars and shareholders get nothing. It is literally something you might think would happen in Nazi Germany, not the United States.
It seems as if these failures are following a pattern that we are seeing over and over. First, short sellers work to smear the bank's reputation. Major media outlets join the fray. Analysts downgrade. Ratings agencies follow with downgrades. Cost of insurance skyrockets creating self-fulfilling prophecy. The Bank forced to come up with reserve capital to please ratings agencies. Dilution of shareholder equity at sale prices. Share price falls further triggering more downgrades from above-mentioned entities. The Media really starts to salivate now and creates all kinds of instability with doom and gloom, and seem outright gleeful about it. Then institutions and high net worth individuals begin pulling deposits out of the targeted bank. Further ratings agencies downgrades. The media then creates a self fulfilling prophesy with constant reporting of doom and gloom and individuals also pull their money out of the targeted bank. Then the FDIC having all the ammunition it needs steps in and seizes the bank assets and sells them to whoever they are in bed with that week.
Basically the government decided that they liked JP Morgan Chase so much as an institution that they would gift them this company.
It's worse than that though, last week Goldman Sachs upgraded WM to hold knowing all of this was going on. Serious misrepresentation of the facts. The story told to the public was that Goldman was supposed to be brokering a sale. This at the expense of average Americans. Sure there are a lot of institutions that owned shares in WAMU, but there are an incredible amount of average Americans who had large portions of their retirements tied up in WAMU stock. Without that upgrade, many may not have kept the stock through this trouble. Some are now threatening suicide. Families are breaking up. People have lost everything. How can the American public not be safe investing in an American Bank. A bank that owns assets, that had a large deposit base and that stated it could sustain life until 2010.
Response to Doug Wilkerson:
ReplyDeleteDoug, you've hit the nail on the head. Our nation did not get here over night. The loss of key manufacturing industries - (exodus for over the past decade) - has caused an economic avalance to occur in this country.
The housing market was 'The last goose to lay the golden egg'.
Even then, we say our own local governments 'move in for the kill'. Look at the impact fees imposed by our legislators. Pittsville $10,000, Wicomico Co. $5,250.
Hell, instead of the government helping to solve the problem . . . your Government has become the problem.
Now that the goose is dead, so is our Country.
All I can say . . . what a friggin mess.