Need to update the aphorism:
If you owe the bank $100, that's your problem. If you owe the bank $100 million, that's the bank's problem. If you owe the bank $100 billion, that's country's problem.
Need to update the aphorism:
If you owe the bank $100, that's your problem. If you owe the bank $100 million, that's the bank's problem. If you owe the bank $100 billion, that's country's problem.
If it’s the country’s problem, then nationalize them. Not loans, not bail outs. Confiscate and figure out how to wind them down in a way that benefits the taxpayers.
Didn't even have to wind them down to benefit in some cases. I can't remember if it was the automaker or some of the 08 bank bailouts where the stock the government took as part of the bailout turned a profit after a few years.
https://projects.propublica.org/bailout/
https://www.reuters.com/article/business/us-government-says-...
GM lost taxpayers $11B, Chrysler lost $1.2B.
You’re likely thinking about TARP:
https://en.wikipedia.org/wiki/Troubled_Asset_Relief_Program
TARP delivered a $15.3B surplus on $426.4B invested for a roughly 3.5% return.
And perpetuated the system. Iceland meanwhile let their banks fail,sent bankers to jail, took the medicine and came out stronger.
Icelander here. The banks were only temporarily nationalized, the plan was always to privatize them as soon as possible. Only a handful of bankers went to jail, their sentences were extremely light, and every single one of them returned to investing as soon as they were able (or even kept investing via family members while in prison). Today they are still the richest people in Iceland and own the majority of all assets.
I think the only reason Iceland nationalized the failed banks in the first place was because they had no other option, the economy is too small, and they simply could not afford to bail them out, the money literally did not exist.
Also, today’s Iceland is extremely troubled by austerity. Schools and healthcare is extremely underfunded. Teachers- and nurses strike almost every 2 years. The city of Reykjavík just started their biggest round of mass-layoff ever.
Well the US nominally put in more safeguards against the same thing happening again. We've just dismantled them in record time and are moving on to those put in place after the 20s for some reason.
Iceland isn’t a global financial powerhouse and it has a low population. My county has twice as many people as Iceland, the city I live in has as many residents as Iceland has citizens.
Wild guess: I suppose in Iceland the banks weren’t buying the politicians.
They were. Or rather they were all friends/family/the same people. Iceland is one of the most corrupt countries in Northern Europe. What happened is due to how small the economy is, the country simply could not afford to bail out the banks. The money required to do so simply did not exist, so they had exactly one option.
Note also that since then, all the nationalized banks are back on the public market with the state only holding plurality or even minority shares. Investment/retirement funds and private investors together hold bigger share then the state. These shares were more often then not released on a steep discount allowing investors (many of whom responsible for the 2008 crash) essentially free money from the state.
Problem is that is bailout with taxpayer money that benefits recklessness by private companies. Nationalising or winding down is a loss for executives who ran the company to the ground. Bailout is not a loss for executives that ran company to the ground. Don't reward reckless executives with financial stability.
I am confused. In my country that is what a bailout means. How do you pay money to a company but not buy them? What is it that the state buys from the company, if not ownership, then? Or is it a gift? That would be insane.
> That would be insane.
The phrase is "that would be good for the economy".
It’s still the notion of trickle down economics at play.
But they did get a 3.5% return on their investment (but not comparable to the equivalent return in the market or even in bonds for the same duration).
That return was in turn used to justify the bailout, but the global macro effects weren’t accounted for: the banks’ fuckup caused misery all over the world for the best part of a decade.
It's a gift. No matter how you structure it - maybe subsidized loans, or anything like that - any bailout that doesn't transfer equity to the government is a gift
Are you perhaps confusing a bailout with a buyout?
Does the US have anything going for it right now besides ai and supporting industries? Something like nationalize or anything extreme would wreck the economy.we would all suffer
How so?
nationalization is likely on the horizon, but definitely not to wind them down (quite the opposite)
You have a point here. It doesn't make sense that a company should get to keep the upside while having downside protection from the government. The problem is that the government makes the biggest bloated legacy nightmare of a corporation look like a 10 person startup. Between the two options I would rather have a pile of my tax money set on fire once every decade decade or so.
Anything critical for the nation should be run by the nation. I'd rather have a voice and the ability to vote out the people running that corporation. You don't get to elect CEOs.
In my experience I would much rather deal with corporate management than government bureaucracy. The fact that I have a vote means nothing to them.
Our government has been working very hard over decades to minimize the impact of the voter. Through gerrymandering, voter suppression, collusion within political parties, etc. and the amount of open corruption going on today shows that our government doesn't think they need to be very concerned about the voters at this point.
I still believe in democracy as a system however. It does need to be protected and maintained though. Jefferson said that "the tree of liberty must be refreshed from time to time with the blood of patriots and tyrants" and right now the tree is starting to look parched, but I'm still hoping we can bring it back into health with just a little more care and attention.
And yet you would still support them nationalizing a company? If you say the government can be fixed, it needs to be fixed before they can get their hands on anything else and ruin it.
That would be socialism and socialism is bad.
Liquidation is not socialism
Why?
If the gov't made bad decisions letting us get to some situation, it doesn't make sense to reward the government and give it even more authority.
That's got perverse consequences. Just like with the corporate leadership, you're encouraging bureaucrats to make bad decisions because (a) they don't have to answer for their bad decisions, and in fact (b) they'll get to expand their authority should their decisions go bad.
The corporate leadership that got us to the problem should suffer, but so should any bureaucrats who had a part it allowing it to happen.
And downvoted into oblivion!
It's kinda like taxes. Who among us would say their tax dollars are and have been well spent? Then why on earth would any of us want to give these idiots more of our hard earned dollars.
I actually like parks and roads and fire departments and social services. I'd happily pay more in taxes for things that are worthwhile. If you don't want your tax money spent on bullshit maybe you should vote for democrats since they're promising not to use your tax money to bail out AI companies.
Everybody can find some government programs they like, and some they hate. I would rather my tax dollars were spent differently than they are. This is normal.
Agree. What about the part where the government spends 30%+ more than it takes in which has been its modus operandi for just the last 2 decades or so?
Yeah. They are going to have to do something about it eventually. The Republican party used to care, or at least claim to, but that seems to have fallen by the wayside. Clinton was the last president with anything even close to a balanced budget.
It really galls me to have to say that Clinton was the best president during my adult years, considering how much I dislike him.
Congress controls spending. People like to forget that because it annihilates their political arguments.
Clinton worked with a Republican Congress (House and Senate). Both compromised, negotiated, and achieved something difficult and substantial.
We don't elect adults anymore.
[flagged]
> So, theft. Got it!
> That will make a lot of businesses focus on success here and not somewhere else.
You have a weird definition of theft. We're talking about nationalizing them instead of handing their shareholders a bunch of free money to bail them out. Not getting free money is theft now?
But, more broadly: there's more to the social contract than private property rights. And it's really hard to bring myself to care too much about the private property rights of entities who have shown themselves to not be very respectful of that contract.
Yes, it is theft.
If you dont want to provide a loan, fine. I dont see how you justify seizing the company.
Imagine asking the bank for a loan and they say "no, and we are also taking your car".
We're explicitly talking about a situation where BigTech and AI labs ask the government for money or (very hypothetically) allow coordinated defaults to spill out into the banking fabric
In those cases, the economy and society you want to externalises losses onto has every right to negotiate something in return. We are not in the business of just forgiving multi billion debts.
That is not the proposal. Negotiation is fine. Forced taking is not.
>Not loans, not bail outs. Confiscate and figure out how to wind them down in a way that benefits the taxpayers.
Some people find authoritarian despotism attractive as long as it targets their perceived enemies
> Some people find authoritarian despotism attractive as long as it targets their perceived enemies
It's not that simple. For instance: a prison sentence is "authoritarian despotism" from the perspective of a murderer subject to it (or his apologists).
I dont think it is that complex in this case.
Most on the left would consider it authoritarian despotism if Trump started "Confiscating" companies. Most on the right would consider it the same if Biden or whomever did the same.
In general, the US has strong opposition to the state unilaterally confiscating companies, and it is the kind of thing seen in Nazi Germany, revolutionary Cuba and Iran, or the Islamic state.
The last time the US government tried this was steel mills under Truman in 1952, and that was with compensation and struck down by the SCOTUS.
> Most on the left would consider it authoritarian despotism if Trump started "Confiscating" companies. Most on the right would consider it the same if Biden or whomever did the same.
Eh. I disagree. It really depends on the company, the why, and what's done with it afterwards.
If the other party nationalized the big frontier labs or AI data center operators, with the rationale that AI is just too disruptive to privatize the gains and/or the companies are acting recklessly, I wouldn't consider it "authoritarian despotism," and I don't think many others would either: those companies are unpopular across the political spectrum.
There's a certain amount of reflexive opposition to "the other side," in that some people will oppose anything it does, but that's just really dumb, so I wouldn't read too much into it on any particular issue.
Now, if the Democrats confiscated "The Trump Organization" on some flimsy rationale because they really hate Trump, that particular action would be seen as you describe.
> In general, the US has strong opposition to the state unilaterally confiscating companies
Thankfully, things can change.
> and it is the kind of thing seen in Nazi Germany, revolutionary Cuba and Iran, or the Islamic state.
That's a dumb argument. "Confiscating companies" is not the reason those regimes are considered bad. And the fact they did some particular thing is irrelevant. I'm sure they also penalize murder, and your not going to get me to question my opposition to murder by saying "the Nazis had anti-murder laws!"
> That's a dumb argument.
nobody said that was the reason they were bad. that's a dumb interpretation.
The point is that seizing companies simply because you have the army and popular support to do so indicates that the government has abandoned respect for law, rights, process, and reason.
It is precisely the authoritarian behavior that defines an authoritarian regime - Taking companies or people with flimsy pretext because they can get away with it. Citizens who cheer and hope for such things are cheering for populist law of the jungle.
If someone is genuinely concerned about safety or disruption, there are 101 legal and boring options the government can take. Those just dont stimulate the the same petty emotions.
The constitution requires paying fair market value whenever a company is nationalized. Theft would be unconstitutional.
Sounds like a reason not to advocate the government do such a thing.
The corporations getting a bunch of free money from my taxes is theft. If they can't keep themselves afloat then let them drown.
No handouts seems entirely reasonable.
I dont see how anyone extends that to the claim us government should forcibly be taking over companies.
The correct analogy is the bank securing the loan with the car, and then potentially repossessing that car.
Don't ask for a loan if you don't want a loan.
How do you get that analogy. The proposal was no loan and take instead
Except in this case they say "No loan for you. But give us your car and we'll give you the money to pay off your debts."
Is it "theft" when someone who pays off another's loans takes legal possession of the debtor's assets as compensation? Or only when the government does it?
You talking about taking a loan and not paying it off?
Fortunately, they do not owe the banks as much as they owe each other and private capital.
I've got news for you on how the economy works.
Well don't leave us hanging, what's the news?
I notice these comments everywhere now. It's some rhetorical sleigh of hand that the absence of a refutal leads to a false assumption that their claim is obvious and needs no support.
I mean, I've certainly used these cheap rhetorical tricks myself offhand, but I'd at least try to avoid using it when vagueposting something this out of pocket.
They borrow the banks money to owe to each other?
Yes, but it appears that the banks are not over levered like they were during the housing crisis. They will take a hit, but presumably will not need bailing out.
> Yes, but it appears that the banks are not over levered like they were during the housing crisis
Banks weren't over levered back then either because all the mortgages went straight into CDOs held by other people/institutions.
The problem was that nobody trusted each other because Lehman could just fail. So they stopped lending to each other (like the daily loans they give each other). Trust evaporated and the whole system stopped dead in its tracks.
Leverage is not the only thing that matters...
And the funds that were over-levered were just barely over-levered. One of the funds that failed had 97% coverage. But that's enough to trigger a run -- you pull your money out ASAP to ensure you're part of the 97%, not the 3%.
https://www.bloomberg.com/opinion/newsletters/2026-10-29/run...
This was true last year, but it would be risky to assume it remains true from one week to the next.
The rate of growth in this sector is "1. move so fast legislators can't keep up; 2. keep going until you hit a limit, then find a way to hack around that limit; 3. GOTO 2".
On money. How about stocks?
Not the person, but I think a corporation, whose main business is or a sizable part of the business is, that hands out money that you then owe them, is called a bank.
No, banks are something fundamentally different, If you loan someone else your own money, you are just a creditor. What makes banks special is they loan out other peoples money (deposits)
Pyramid scheme?
You’re not wrong.
Sucks that most of the country didn’t vote for the $100 billion, but will be left holding the bag. Are we witnessing the fall of an empire?
That's an evergreen template.
Trump admin, to their credit, seem to have somehow figured this out.
They bailed out Intel and the stock recovered.
Might do the same.
Bad new for you, their stock fell -29% today, the largest collapse since the 70s. It's nearly back to last years' level.
It did the temporary job. INTC is doing the work. Things take time.
I think you may be confusing the (temporary) improved stock price with improved/recovered profitability? I see the (temporary) stock price recovery, as driven PURELY by valuation, i.e. an increase in P/E (instead of EPS).
Intel’s revenue is currently worse than 10 years ago, and gross profits are 2/3 of what they were around 2012.
The temporary price hike was caused by a huge temporary jump in relative valuation (probably because the US Gov started subsidizing).
See the historical graphs:
- https://www.macrotrends.net/stocks/charts/INTC/intel/pe-rati...
- https://www.macrotrends.net/stocks/charts/INTC/intel/revenue
- https://www.macrotrends.net/stocks/charts/INTC/intel/gross-p...
Well yes, that's why they need the bailout. They are getting smoked.
Big companies are like big ships. Takes a LONG time to turn.
Game is not over yet.
I was commenting on this though
> They bailed out Intel and the stock recovered.
I don’t think the stock (or the company) has recovered at all. Neither profits nor revenue (see my links above).
But hey, who knows what the future brings.
The bailout was in Aug 25 when INTC was < $25.
It closed today above $60.
That's a stock recovery.
I was very specific. I said stock. That's a recovery.
Sure, the stock price is up.
Currently trading at 3-4x historical valuation (20y typical range of forward P/E).
Again. Very specifically said the stock recovered. That's a positie.
So the bailout was a complete waste of money? Why couldn't they have done the work before and we just waited?
The bailout was a year ago.
It takes forever to do anything new in hardware.
This is unfortunately a VERY long game.
I think you are presenting this as true, but all the evidence points to the bailout as having no effect. You aren't presenting any counter evidence other than just saying it worked and to wait.
What could someone say that would convince you the bailout is working as intended.
An article that was the exact opposite of this one https://www.cnbc.com/2026/10/30/amazon-intel-earnings-big-te...
So nothing specific. Gotcha.
An article that is the exact opposite of an announcement they've had their worst day on the market in over fifty years is far more specific than "Trust me it worked"
Bruh. You are not being specific. I was being specific.
The stock price recovered. This is a fact. From 20 to 60.
Cannot be argued.
The business will take time to recover. There is no other way. Either it takes time to recover, or it never does. One year is not remotely enough time to know.
You didn't read the article, this thread is pointless
I'm not reading an article to infer whatever point you're making. Either make your point, or admit that you are just being contrarian because you hate Drumpf
We've already established you do not read
So your entire argument is to be smarmy and condescending and refrain from being specific because you have no actual argument.
> Trump admin, to their credit, seem to have somehow figured this out.
> They bailed out Intel and the stock recovered.
This is not demonstrated. What did the Trump admin "figure out"? Socializing private losses (especially if it's only temporary), is another problem, not a solution.
> What did the Trump admin "figure out"?
How to abuse their position to stuff insane amounts of money into their own pockets at the expensive of the American people and get away with it.
In my dreams Trump is revealed as a Chinese agent and gets a parade in Beijing.
I've heard theories that he's an agent working for Russia and while I doubt he's some kind of spy it's difficult to imagine an enemy doing a better job than what's he's accomplished. He's repeatedly leaked classified information (https://en.wikipedia.org/wiki/Donald_Trump's_disclosures_of_...). He has physically destroyed the white house. He broke up or crippled the agencies we depend on. He has weakened our military by forcing out top US military officers, depleting U.S. munitions stockpiles, and draining their budgets. He's tanked our economy. He's decreased our freedoms and weakened our very democracy. He's sold off our national parks and public lands. He's isolated us from our allies.
Our enemies should be throwing him parades even if he isn't a foreign agent. He's the gift that just keeps on giving.
If you print money, you are the bank. Tokens are the new currency.
[dead]