Oh isn't that awful? I guess they want that $1 trillion dollars right now.
CNBC reports on the details.
Supposedly Democrats have the gall to ask that these bastards leveraging their companies 40:1 and pocketing the cash not have their multi-million dollar golden parachutes and that is the sticking point.
Here is what Democrats want, which appear to be the shares and unless I'm reading this wrong, nothing about paying good money for worthless debt.
Limitation on Authority
1. In General
The Secretary may not purchase, or make any commitment to purchase, any troubled asset unless the Secretary receives contingent shares in the financial institution from which such assets are to be purchased equal in value to the purchase price of the assets to be purchased.
2. Shares To Be Received
A.) Contingent Shares
i.) In General
The contingent shares to be received by the Secretary under paragraph (1) may, at the determination of the Secretary, include shares of the financial institution, its parent company, its holding company, any of its subsidiaries, or any other entity which is owned, controlled, or managed by such institution.
ii.) Debt Instruments
In the event that the equity of the financial institution from which such troubled assets were purchased is not publicly traded on a national securities exchange, the Secretary shall acquire a senior contingent debt instrument in lieu of contingent shares, which shall automatically vest to the Secretary on behalf of the United States Treasury in an amount equal to 125 percent of the dollar amount of the difference between the amount the Secretary paid for the troubled assets and the disposition price of such assets.
The Secretary may demand payment of such contingent debt instrument under such terms and conditions as determined appropriate by the Secretary.
B.) Multiple Class of Shares
If the financial institution from which troubled assets are to be purchased has more than one class of shares, the contingent shares to be received by the Secretary shall be that class of shares with the highest trading price during the business 15 days prior to the date of the purchase of such assets.
The instrument representing the contingent shares shall contain anti-dilution provisions of the type employed in capital market transactions, as determined by the Secretary, to protect the Secretary from transactions such as stock splits, stock distributions, dividends, and other distributions, mergers, and other reorganizations and recapitalizations.
3. Vesting of Shares
If, after the purchase of troubled assets from a financial institution, the amount the Secretary receives in disposing of such assets is less than the amount that the Secretary paid for such assets, the contingent shares received by the Secretary under paragraph (1) shall automatically vest to the Secretary on behalf of the United States Treasury in an amount equal to—(A) 125 percent of the dollar amount of the difference between the amount that the Secretary paid for the troubled assets and the disposition price of such assets; divided by (B) the amount of the average share price of the financial institution from which such assets were purchased during the 14 business days prior to the date of such purchase.
My question is will this even work? Anybody analyze that one?