The Bad and The Ugly- For a Few (Trillion) Dollars More...

President Obama (POB), Congress, the Fed, the Bank CEOs, and the rest of the bunch have put up some staggering numbers this week. The stimulus package of $790 billion has been passed. This gem of a bill is a sight to read. According to AP, "The president's signature tax cut was preserved -- a break for millions of lower- and middle-income taxpayers of $400 per individual and $800 per couple. That's less than the $500 and $1,000 the White House originally sought, although officials said it would mean an estimated $13 per week extra per paycheck.Wage-earners who don't earn enough to pay income taxes would get a reduction in the Social Security and Medicare taxes they pay. Another provision will mean a one-time payment of $250 for millions of beneficiaries who receive Social Security, Supplemental Security Income and veterans pensions and disability, according to officials. They added that the measure will include $46 billion for transportation projects such as highway, bridge and mass transit construction....The agreement would allow taxpayers to deduct the sales tax paid on new car purchases, but not the interest on loans for the same vehicles.....Not every decision was driven by concern about job creation, though.The bill includes $70 billion to shelter wealthier taxpayers from the alternative minimum tax, originally passed a generation ago to make sure the super-rich didn't avoid taxes. The Congressional Budget Office estimates that provision will have relatively little impact on the economy." $70 Billion to avoid AMT, $46 billion for transportation projects...No wonder the country is sinking.

On a second front, the administration is putting $2,000,000,000,000 dollars more into the banking system. The plan proposes using Federal Reserve loans and private capital to leverage up the remaining $250bn or so in the troubled asset relief programme to create roughly $2,000bn in buying power. The administration will create a Public Private Investment Fund to buy $500bn to $1,000bn of toxic assets at prices established by private co-investors. Meanwhile, the Federal Reserve is to provide up to $1,000bn in financing for securitised credit markets. The Treasury will set aside another $80bn in risk capital to absorb losses on the Fed loans, and spend $50bn on anti-foreclosure programmes.The Treasury said any bank receiving injections would be prevented from paying dividends of more than 1 cent per quarter, repurchasing shares and making cash acquisitions of healthy companies without approval.