That total dipshit, Barney Frank, is surprised that the $700 billion of your dollars that the moneyBoyz stampeded him into forking over is being used to pad their bottom lines, not yours. Fucking moron.

Rep. Frank: bailout funds must be used for lending

WASHINGTON (Reuters) - Companies receiving public money under a U.S. government financial rescue program must use it for lending or they will be violating the law, the powerful chairman of the U.S. House of Representatives Financial Services Committee said on Friday.

"I am deeply disappointed that a number of financial institutions are distorting the legislation that Congress passed at the president's request to respond to the credit crisis by making funds available for increased lending," Rep. Barney Frank, a Massachusetts Democrat, said in a statement.

"Any use of the these funds for any purpose other than lending -- for bonuses, for severance pay, for dividends, for acquisitions of other institutions, etc. -- is a violation of the terms of the Act," he added.

Frank said U.S. Treasury Secretary Henry Paulson must make it absolutely clear to a participating entity that the federal government will insist on compliance.

[Yeah? How you gonna do that, Barney-boy? You wrote him a fucking blank check with no teeth behind it! More of Frank's pathetic snivelling here ->]

Treasury is heading up a $250 billion capital injection program into U.S. banks as part of the larger $700 billion market bailout legislation passed earlier this month.

The first $125 billion went to nine large U.S. banks, and the Treasury is actively distributing the other $125 billion to community and regional banks around the nation.

As part of the program, banks get capital injections and must give the government senior preferred shares.

The program also includes restrictions on executive compensation and a prohibition on increasing dividends and stock repurchases.

In recent days, lawmakers have tried to attach more conditions to the program, including a prohibition on any dividends and restrictions on the type of lending allowed.

The conditions would likely come as guidelines, not requirements, but bank supervisors could enforce the guidelines by essentially restricting the banks' activities if they don't agree to them.

A Bush administration official said on Thursday that putting excessive restrictions on banks' activities could result in weaker -- not stronger -- financial institutions.

When describing the plan on October 20, Paulson said the program was designed to attract private capital and to encourage lending.

"Our purpose is to increase confidence in our banks ... so that they will deploy, not hoard, their capital. And we expect them to do so, as increased confidence will lead to increased lending," Paulson said.

From Charles Smith at Of Two Minds blog:

We hear a lot these days about the middle-class-- Middle-class tax breaks, etc. But what exactly constitutes "middle-class"? The usual definitions are income-based, as in "between $45,000 and $125,000."

I submit that since income-based definitions do not actually address either asset accumulation or purchasing power, they are a priori of no value. Instead, I propose the following definition of middle-class based on what the income can accomplish/buy:

1. No more than 30% of net income is spent on housing, either to own or rent.

2. 6-8% of net income is saved--not including retirement IRAs or 401K plans.

3. No more than 15% of net income is spent on medical and dental expenses, including insurance.

4. The household can afford to pay tuition, fees and books for two household members living at home and attending a 4-year state university/college.

5. Food (including meals away from home) costs no more than 15% of net income.

6. The household can pay cash for a recent-vintage reliable used vehicle, and can support the one reliable vehicle and a "beater" old vehicle for secondary use; the household carries no auto loans.

7. The household pays off all credit card purchases monthly and carries no consumer credit balance.

8. The household can afford to take a domestic vacation once a year without incurring debt or tapping the 6-8% of income set aside for savings.

9. If the family owns a residence, the equity stands at a minimum of 50% of market value.

10. The household maintains at least 6 months' living expenses in readily accessible savings.

By these standards, how many households in the U.S. are truly "middle-class"? Not very many.

You might say, "You've described a fantasy world."