Nightmare on Wall Street
Halloween came early this year. As Wall Street crashed, the US Congress put together a $700 billion rescue package to stabilize the markets and stop the meltdown. That was four weeks ago, and around the globe, governments have since promised banks tax infusions to keep them alive. Mind you, those governments are in debt themselves.
Then, just in time for the real Halloween, came this bit of news: While millions of small shareholders in UK banks will not earn dividends on their holdings for years to come under the terms of their government's bailout plan, US banks will pay more than half of the amount they receive to their shareholders. Sorry, taxpayers, the shareholders still come first. US treasury officials said that suspending the dividend payments would have kept banks from participating in the voluntary program in the first place.
This month in Spotlight, LISA FOSTER explains the nightmarish mortgage crisis that caused Wall Street's "House of cards" to collapse (Spotlight, November 2008). Zombie banks, vampire shareholders and haunted houses will continue to plague us long after Halloween is over and the new US government takes office. So come and prime your vocabulary with some basic financial terminology.