Two weeks after closing its purchase of Merrill Lynch at the urging of U.S. regulators, the government cemented a deal at midnight Thursday to supply Bank of America with a fresh $20 billion capital injection and absorb as much as $98.2 billion in losses on toxic assets, according to people involved in the transaction.
The second lifeline brings the government's total stake in Bank of America to $45 billion and makes it the bank's largest shareholder, with a stake of about 6 percent.
In exchange for the new support, Bank of America will give the government an additional $4 billion stake in preferred stock. It has also agreed to cut its quarterly dividend to a penny, from 32 cents, and accept more stringent restrictions on executive pay.
When will the madness stop? It said nothing in the article about Congress. Is the Treasury just going around making financial deals with companies and giving them billions in loans? Where is that money coming from and who has authorized its use? Spending money is a power that belongs to the House of Representatives exclusively among the Federal government.
How is this happening? I would really like to know. Is there some legal explanation for this? Anyone who knows what twisted rationale is behind this kind of activity- please share in the comments below.
How many more companies are they going to nationalize before Americans wake up to the reality of what's happening to their country?
And an important discussion point: What can we do to protest this? Please share ideas in the comment thread. The most frustrating thing about this is that it's so difficult to directly face and protest. It's not like they are violating my rights directly. Instead they are violating everyone's rights and they are doing it in a very indirect manner. Any ideas you might have that are creative and inspiring, ideas that involve protest or civil disobedience, please share and discuss. We have got to take action!