What Happens if the Entire Financial Industry is Nationalized?

[DemonD]

http://www.cnbc.com/id/27835645

It's not preferable, but all major U.S. financial companies will eventually be under government control because the alternative is so much worse, Hugh Hendry, chief investment officer at hedge fund Eclectica Asset Management, said Friday.

"All financials will be owned by the U.S. government in a year," Hendry said. "I bet you."

I actually wanted to put this in the "ask itulip" section, because I really am wondering what will happen if the entire financial industry is nationalized. Could it be nationalized?

[aaron]

Re: What Happens if the Entire Financial Industry is Nationalized?

What happens when you do not pay back a loan now? Bankruptcy, foreclosure, repossession, etc. What happens when you do not pay the government what you "owe" them? (Think taxes and the IRS).

I fear the day we get our mortgages from Uncle Sam.

[Judas]

Re: What Happens if the Entire Financial Industry is Nationalized?

The government is there (theoretically) to use it's monopoly on force to protect citizens from the fraud, abuse, and concentrating power of monied interests.

Now the government will BE the moneyed interests.

[Nervous Drake]

Re: What Happens if the Entire Financial Industry is Nationalized?

.

[*T*]

Re: What Happens if the Entire Financial Industry is Nationalized?

The government is there (theoretically) to use it's monopoly on force to protect citizens from the fraud, abuse, and concentrating power of monied interests.

Now the government will BE the moneyed interests.

It would save on your taxes at least.

And all the derivatives contracts would net.

[vinoveri]

Re: What Happens if the Entire Financial Industry is Nationalized?

this is a huge (and immoral) wealth transfer.
It works like this:

Banks lend to everyone with abandon and rake in huge profits;

The debtors keep borrowing/leveraging/rolling over their debt until they can no longer service - and then default; - bankruptcy essentially forgives the debtor

Banks approach/become insolvent due to increase in these defaults

[up to this point, everything is fine, banks make too many bad loans, they go under along with their shareholders - never mind about the absent regulators who are there to insure that risk is properly managed with common sense underwriting standards]

But instead, gov steps in, guarantees the bad debt and pumps cash into the banks to make them solvent - voila the investors/creditors are made whole or somewhat whole - the debtors have been "forgiven" AND the gov owns the bad debt - so essentially the private debt, from homeowners - consumers - students- bus owners etc built up over the past decade(s) from spending more than one earns is transferred from the private sector onto the public debt.

The populace doesn't readily see how this harms them. they won't be able to connect the dots when milk is $10 gal in a few years.

[blazespinnaker]

Re: What Happens if the Entire Financial Industry is Nationalized?

http://www.cnbc.com/id/27835645



I actually wanted to put this in the "ask itulip" section, because I really am wondering what will happen if the entire financial industry is nationalized. Could it be nationalized?

Well, the banks are already nationalized: check out TLGP

I could see a few more financials applying to become banks.

[Mega]

Re: What Happens if the Entire Financial Industry is Nationalized?

Ask "Metalman" on this!
Mike

[tsetsefly]

Re: What Happens if the Entire Financial Industry is Nationalized?

What happens when you do not pay back a loan now? Bankruptcy, foreclosure, repossession, etc. What happens when you do not pay the government what you "owe" them? (Think taxes and the IRS).

I fear the day we get our mortgages from Uncle Sam.

I am sure 99.9% of what the government is doing right now is illegal, I hope someone takes it to the supreme court...

Aside from the brutality of the IRS when it comes to not paying taxes, the invasion of privacy they commit is even worse, it would only get worse with this...

[politicalfootballfan]

Re: What Happens if the Entire Financial Industry is Nationalized?

----nm----

[reallife]

Re: What Happens if the Entire Financial Industry is Nationalized?

This would be communism or fascism.