MontNews.com

Washington, DC — An inside source has said that Bank Of America is likely to need an additional $34 billion. This comes after their CEO, Kenneth Lewis, said, “We absolutely don’t think we need additional capital.”

The stress test is a U.S.A. government plan to examine the health of banks. The results expected to be made public late on May 7, 2009.

Washington, DC — There is a misplaced belief that the US government is bailing out big business and financial institutions; however, bailing out is probably not a good way to describe the arrangement.

Many of the small and medium sized banks did not want to take Troubled Asset Relief Program (TARP) money. At the time, there was heavy pressure from government officials for all the banks to take the money even if they were not in need. The thinking was that if all banks took the funds it would be harder to tell which banks were really in trouble (causing a run on certain banks.)

Now, the banks that were in solid standing and did not want the TARP money are finding it hard to pay back. When the banks entered into the program, the government was issued warrants. Warrants are a type of stock option. If a bank wants to repay the TARP money, they also have to pay off the government’s warrants. For some banks that have repaid TARP debt, the buy-back of their warrants has equated to a 60% rate of interest.

Not only are the banks not getting bailed out, they are forced to submit to the governments interest rate usury.

The world has been waking up and raising a voice against President Oboma’s budget and stimulus plans. How can you spend, spend, spend money you don’t have? Who will pay back the debt?

The European Union has taken a stance against the massive amount of spending. The head of the EU, Czech Prime Minister Mirek Topolanek, said it was “the road to hell.”

Sen. Judd Gregg (R-N.H.), who several weeks ago had almost joined Obama’s cabinet, came out strongly opposed to the budget. Judd said, “We believe you create prosperity by having an affordable government that pursues its responsibilities without excessive costs, taxes or debt.”

“In the next five years, President Obama’s budget will double the national debt. In the next 10 years, it will triple the national debt.”

“His budget assumes the deficit will average $1 trillion every year for the next 10 years and will add well over $9 trillion in new debts to our children’s backs. He also is proposing the largest tax increase in history, much of it aimed at taxing small business people who have been, over the years, the best job creators in our economy.”

The proposals “represent an extraordinary move of our government to the left.”

“He is very forthright in stating that he believes that by greatly expanding the spending, the taxing and the borrowing of our government, this will lead us to prosperity.”

“It is the individual American who creates prosperity and good jobs, not the government.”

“We believe that you create energy independence not by sticking Americans with a brand new national sales tax on everyone’s electric bill, but by expanding the production of American energy … while also conserving more.”

“We also believe you improve everyone’s health care not by nationalizing the health care system and putting the government between you and your doctor, but by assuring that every American has access to quality health insurance and choices in health care.”

“The U.S. has an exceptional history of one generation passing on to the next generation a more prosperous and stronger country, but that tradition is being put at risk.”

by widgette.com

Bank failures continue to escalate over the face of the globe. Four more US banks were closed by regulators in Nebraska, Florida, Illinois and Oregon.

In the UK, Lloyds is already 43.5% government owned after having to seek assistance last fall. Now, they face $14.2 billion loss. At the same time, they still wish to pay multi-million dollar bonuses to employees. It is unlikely the government stakeholders will approve such bonuses. On the other hand, the government may be forced to nationalize the bank.