Assignment 1 Post 2

The Obama Administration is starting to deal with economic situation. As of Monday, the administrations  "put the biggest banks on notice." The United States government will become the biggest shareholder if regulators decide that the banks are not strong enough and more downturns will occur in the economy. 

I find it very important that the Obama Administration deal with this situation. Our economy continues to go downhill, more people are getting laid off and are not able to afford many things. The banks are not the only businesses that need help from the government. The economy is hurting so many businesses, that the money that is being given out to help the economic situations needs to be evenly divided among those businesses. 

If we do not do something fast the economy will continue to down spin and more jobs will be lost, people will lose everything and we will be dealing with another Great Depression. All banks need to pass the "stress test" so that banks will no longer have issues. 

I believe the banks should be a private matter but the government needs to make sure they check up on the banks, and if they see something wrong or suspicious, then they should step in and change it. More work needs to be focused on helping the common person out in the economic situation. The banks may need help but other people and businesses do as well. 

Assignment 1 Post 1

The Obama Administration is starting to deal with economic situation. As of Monday, the administrations "put the biggest banks on notice." The United States government will become the biggest shareholder if regulators decide that the banks are not strong enough and more downturns will occur in the economy. 

The government is starting to demand "direct ownership stake in major banks." One of the largest groups to receive help is Citigroup. They have received $45 billion in direct assistance. The twenty biggest banks will now be required to undergo a new "stress test" starting Wednesday February 25, 2009. This new test is to determine if every bank has enough capital to survive the economy. 

If the banks come up short then the government will need to raise more capital. The government is trying to make sure that the banks strengthen their capitals by replacing shares.