Construction Bonds
| Wed Sep. 17, 2008 1:25 PM PDT
CONSTRUCTION BONDS....Andrew Sullivan is amused by a CBS report that Sarah Palin actually answered a question from the press today, "prompting concerned looks from staffers." I can well imagine. However, I'm more perplexed by the answer itself:
"Disappointed that taxpayers are called upon to bail out another one. Certainly AIG though with the construction bonds that they're holding and with the insurance that they are holding very, very impactful for Americans, so you know the shot that has been called by the Feds — it's understandable but very, very disappointing that taxpayers are called upon for another one."
Construction bonds? What is she talking about? Maybe performance bonds? Not that that makes any more sense. What's more, I'm pretty sure that AIG's consumer and commercial insurance business wasn't in any danger. So why focus on that? I mean, if you're only going to give the press a single sentence, why not spit out something about counterparty risk and leave their jaws hanging?
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Comments
Kevin, let me congratulate you (sincerely) on the variety of your posts. I don't give you enough credit. The posts today are thoughtful and on a wide variety of topics. You may be aware that your old stomping grounds "Political Animal" has basically turned into the Obama Monthly. I started counting, and before giving up, noted that the LAST 28 threads at PA are on how great Obama is in every way, and how rotten McCain is in every way. Literally, not a single other topic for 28 posts. And as I said, its probably far more. I gave up counting. I'm supporting Obama too, but Jesus Christ, I don't think the Obama Campaign is putting out as much pro-Barrack material as Washington Monthly these days. It's a tiresome echo chamber.
Good lord, her answer was pratically unintelligible. factual mistakes aside, it was a grammatical train wreck.
I didn't think it was possible to lay on the down-home folksy crap any more than Bush has done, but Pain raises the bar every time she opens her mouth ("well, I gotta tell ya guys & gals, it's time we got to fixin'...")
What a horror show.
Question: Why was AIG bailed out? Was it that they carried massive amounts of insurance for all of our crappy mortgage loans? Do they really sell money market funds? Sorry, but I'm just about illiterate when it comes to the workings of the big sh*tpile, to quote Atrios.
An idiotic answer, for sure, but maybe informative about how she thinks on her feet.
As a small town mayor and small state governor she probably at least recognizes that something called "construction bonds" exist. Those are bonds that public bodies typically require construction contractors to obtain to secure the performance of public construction contracts. She heard the term "bond," felt compelled to give a coherent response, and so spouted something without regard to whether it made sense.
Strategically, if she at least spits out a syntactically correct sentence, then the low information voters think she's on top of things, because they don't know what the hell she's talking about either. In this case, it looks like she didn't even meet that threshold. So, double stupid, and chalk one up for the good guys.
McCain's candidacy, rather the agenda of his candidacy in the wake of it being exposed as an absolute failure, combined with the nomination of Sarah Palin have got to be an Republican sociology experiment in How far can we go with this nonesense?
Didn't Sister Sarah's pastor say Alaska would be a safe haven in case of Armageddon?
The thing is, I can't remember if it's been reserved for the saved, the unsaved, or the about-to-be saved.
Let me know in case I have to round up a dog team and mush on up to AK.
So do you think pit bulls are mushable?)
RAF beat me to it. You're concerned with the construction bond part? I'm concerned that McCain has chosen a chatbot for his running mate, one programmed with a small set of political phrases that are simply strung together without regard for semantics or (in this case) syntax.
Palin's answer would be hilarious if it wasn't terrifyingly tragic! Think of the intellect of the founding fathers and the years they spent THINKING about and writing our Constitution so that we could enjoy a long lasting functioning democracy! When and how did such a large segment of the US population decide that intellectually challenged individuals were best suited to head our government?
In many state procurements for construction contractors are required to post bid bonds, payment bonds and performance bonds. AIG, like other insurance companies, may provide these bonds for contractors in Alaska.
Gov. Palin thinks AIG was bailed out to rescue state construction project contracts.
Submitted by The Lounsbury (not verified) on Wed Sep. 17, 2008 2:17 PM PDT.
AIG was bailed out because they are the largest insurer (insurance company, not bankone trillion USD in assets and they are a major counterpary in insurance contracts on debt. Indeed one of the biggest in the world.
Plus, on their asset management end, they are one of the world's largest - World, not US - managers of investment portfolios, via Life products and other life/long term investment products.
So, the really short answer is: never mind Bear, your fucking GSEs - Fannie, Freddie - if AIG went bankrupt today, you would have seen a global financial system collapse worthy of the 1930s. Even the whiff had lines in Hong Kong, etc. at AIG subs.
Goddamned leftists, complain about every fucking move.
As for the dimit Palin. I just bloody hope that you fucking idiots in the American Left save yourselves from yet another goddamned failure, as the world can not afford another 8 years of incompetence a la Bush.
So we're bailing out the whole world, preventing total global economic collapse, are we? Maybe we oughta stop and give that another think. Then again, on the other hand, guess that means they owe us now. So we're a superpower again, yay. No wait, maybe we bailed AIG to keep the Chinese from doing it. . .
Here in Canada, one of the major-party candidates in our federal election is a native French speaker who learned English late in life, and not well at all. You can usually get the jist of what he means when you hear him say it, but his newspaper quotes often read very very strangely.
This Palin quote reads way, waaaaay weirder than the quotes of someone who speaks minimal English.
Submitted by tpx (not verified) on Wed Sep. 17, 2008 2:54 PM PDT.
We are having a global financial system collapse worthy of the 1930s. The sooner the failed markets are acknowledged the sooner new ones can be contructed to replace the failed ones. Bailing out AIG makes the current markets vampires and zombies - the living dead.
Simple syllogism:
We, the common folk, are clueless about how to solve the financial crisis.
Sarah Palin is one of us, the common folk.
Hence, Sarah Palin is clueless.
And Mark S. - WHAT!!!, are comparing Sarah Palin to a HORSE?!?!?!?!!!
Another way that Palin is just like us:
Back in school, what did you do when you were clueles about an essay question on a test? The semi-intelligent ones knew they were bullshitting when they just threw out some possibly relevant vocabulary and phrases in hopes of getting at least partial credit.
Isn't it about time that the term BULLSHIT becomes acceptable in the regular media? 'Cuz what we are seeing is nothin' but.
Submitted by Aaron S. Veenstra (not verified) on Wed Sep. 17, 2008 3:37 PM PDT.
What Palin meant to say was that AIG has simply gotten too big and too expensive to the taxpayers.
She betrays even more ignorance than I thought she was capable of. The strongest part of AIG's business is the commercial insurance part, which included payment and performance construction bonds.
Even if the AIG parent company went belly-up, the operating insurance companies which are separate entities regulated by the individual states they do business in would survive just fine, they are well capitalized and can't by law engage in risky investments (like AIG stock for example).
It's the financial products that AIG was selling that has caused the grief, and Sarah was exactly wrong in describing what the real danger was here. I guess we can add economic policy to foreign policy as areas she needs remedial classes in.
You guys are focusing on one piece of what she said -- her reference to "construction bonds" as one of the reasons that AIG's problem impacts Americans. I don't know if that is true or not, but no one here has demonstrated that it is not true.
As to her expresion of disappointment for the taxpayers and deference to the judgment of the feds, what is wrong with those comments?
I don't think any of the other candidates have distinguished themselves with their statements. Biden's idiotic response was that the Bush tax cuts caused the problem. I assume even you folks will concede that makes no sense.
But this is a good issue for Obama to try to exploit and he probably will move up a couple points in the polls.
Cue Brian with his standard issue dishonest troll post.
Biden cited THREE root causes for the current financial fiasco, tax cuts for the ultra wealthy, failure to have regulation, and CEO bailout packages.
Bri, the tax cuts let the CEO's rape the system and pocket the gold mine. If the CEO's actually had to keep the system solvent for 5 or 6 years, they may have had to show a little constraint.
Before you prattle on about the golden parachutes for the guilty not being a root cause, history, think S+L scandal, tells us that the system will be bailed out by the USG with the parachutes intact. Funny how history is usually right.
For the record, Bri, I didn't care much for Biden's comments, either; they were mostly incoherent, not in Palin's league, though, with a heavy dose of talking points.
Indeed, AIG does not even claim to sell "construction" bonds, they sell "surety" bonds. In the Hannity interview, "construction bonds" are the first reason she gives for the bailout of AIG. No one knows what she's talking about because she couldn't get the terminology straight. Regardless, the surety bonds are profitable and will in fact eventually be sold to help pay for the bad mortage products.
She also blamed shareholders of AIG for not holding its management responsible. Since the shareholders get nothing but public information, how were they to hold AIG management to account for nondisclosed liabilities?
What's truly great is that Hannity makes absolutely no pretense to being a journalist.
He's just a regular guy, too, and that's pretty cool. He loves Sarah just like everybody else!
I love the little smile, the head nodding in affirmation at her "answers".
Jeeze, I hope he brought some kleenex.
