Going through the text and reading the initial reviews I want to briefly point out several key points. I won't go into too much detail as a lot of other articles have been posted already.





From section 8.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.



Read it again. The Secretary gets to make all the decisions and they can not be reviewed or questioned BY ANYONE, not even the courts.



From Section 12

The term "mortgage-related assets" means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008.

How the hell did commercial mortgages get involved in this. This is an outrage to say the least.



From Section 10.

Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.

Yup, the Debt ceiling just got raised...this time to $11.315 trillion (the current debt is about $9.6 trillion). Paulson has been given the authority to go out and spend $700 billion with NO oversight and NO review.



From Section 6.

The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time

Note the open ended nature here. Although the purchases are limited to $700 billion, the little line at the end says "outstanding at any one time. So in theory at least Paulson could buy $700 billion in mortgages, sell them for say $400 billion, and then be right back to the beginning, able to buy another $700 billion. This looks like the mother of all blank checks.



From Section 3.

In exercising the authorities granted in this Act, the Secretary shall take into consideration means for-- (1) providing stability or preventing disruption to the financial markets or banking system; and (2) protecting the taxpayer.

Note the Secretary shall take into consideration "protecting the taxpayer". That's it! He only has to take it into consideration. He doesn't actually have to do it!



Summary:

What a MESS!!!!! The US dollar will be toast. The taxpayers are screwed. The people who made this mess remain at large, with no penalties.

This is a total sell-out, corporate socialism of the worst kind, and even so, it may not work. It relies on the Treasury being able to sell even more debt...to whom may I ask? China? Russia, Saudi Arabia? American institutions no longer have the financial flexibility to take on thsi volume of debt, and I question whether some of the other nations do either...at least without a major kick higher in interest rates.