Despite the first treat of $125 billion handed to banksters, and seeing the Dow jump up in jubilation over 9,000 two days later, we saw it trick below the mark as the Fed handed out its lower discount rate from 1.5 percent to 1 percent, record lows reached in 2003 and 2004. And the doorbell is ringing again with voices shouting “trick or treat.” Really, it’s the banks!

It seems the $700 billion rescue for the economy to buy, according to AP, “devalued mortgage-back securities from tottering banks to unclog frozen credit markets was not the treat expected. It was really a trick to buy stakes in banks, pay dividends, give employees salary hikes, execs their bonuses, or just play scrooge with it. Insurance companies were shouting for a treat from the basket too, even automakers, though Congress had already passed out $25 billion in low-interest treats to them. But you know how kids are, who maybe are bankers in kid costumes, they’ll eat the cash till their bellies ache.

The hungry homeowners trying to keep the bell-ringing wolf from the door were still waiting for their foreclosure treats. Were they being tricked, too? Was Congress also tricked once again by the Bush administration? Was that skin-headed Paulson blood sucking the Treasury for his fellow Transylvanians? It seems that buying equity stakes in banks tricked off course. What happened? asked Sen. Richard Shelby, top Republican of the Senate Banking, Housing and Urban Affairs Committee, who opposed the bailout in the first place.

TARP (the Troubled Asset Relief Program) was turning into a trap, it seemed, in which monies were getting lost, and covered with a tarp that stunk as bad as the toxic mortgages which were supposed to be bought up. Then, once European governments sniffed the financial treats, their trick was going into the banking business, too. So Hank sent a $250 billion basket of treats to buy stock in “healthy” banks for lending.

But, there were more tricks. Bank execs thought they could use the treats for acquisitions. Senator Christopher Dodd, chairman of the Senate banking committee, called this revoltin’ development “beyond troubling,” like a Gummi Bear that sticks between your teeth. The next day, government trolls, little devils that they are, said yes and PNC Financial Services Group was okayed for a $7.7 billion bag of treats, er, greenbacks and would send back company stocks. They also said they were scooping up National City Corp. for $5.58 billion. Yup, they had their JP Morgan costumes on, tails, striped pants, spats, and twirling mustaches.

Paulson called this “consolidation,” “not the driver behind the program.” Just to make healthy banks full of financial treats for lending. New York State Senator Charles Schumer didn’t like giving away treats as dividends to shareholders. In fact, he feared a lot of these financial treats could end up “stuffed in mattresses,” quite a trick at that.

But Neel Kashkari, bloody talking head of the Treasury’s financial in-stability programs, told Dodd’s committee too many rules might discourage financial groups from ringing the Fed doorbell. There were even more tricks. He mentioned firms applying for treats might own assets that qualified for sale under TARP.

Actually, the Treasury hired the Bank of New York Mellon Corp as “custodian” of TARP. Via reverse auctions, lowest bids will get the treat of the devalued securities. Yet, on the same day Treasury hired Mellon, it delivered a $3 billion investment treat for their capital-infusion program. It was kind of a trick on us and a treat for them at the same time. Some people call it conflict of interest.

What with the elections and all, lawmakers reminded the revelers it was election time and the law was aimed at treating distressed homeowners to federal guarantees to negotiate mortgages down to lower monthly payments. Sheila Blair, head of the Federal Deposit Insurance Corp, said her gang was working “closely and creatively,” (uh-oh) to “realize the potential benefits treats of this authority.” Double uh-oh!

More tricks for Reserve Fund investors

While the banks were walking away with bags full of cash candy, the Reserve Fund, the country’s oldest money market fund, froze hundreds of thousands of customer accounts for more than six weeks -- with no treats (like their own money) in sight for depositors. At least 400,000, maybe a million, people can’t get their hands on their savings. These folks assumed their money funds were as safe as bank accounts! Trick! They’re not. And their depositors are getting noisome.

They were told they could sleep at night if they invested in the funds. But these folks have been up most nights wondering how long this little trick is going to last. They’re broke or getting there from waiting, that is since September 14, when the Reserve Fund was smacked by a wave of redemptions. See, its largest fund had a stake in notes backed up by the freshly bankrupt Lehman Brothers.

So, next day, its $62 billion Primary Fund plus two small offshore funds “broke the buck,” losses dropped their per share price under a dollar. It led the Treasury to set up some treats, that is, a temporary insurance program for money market funds. Even this venerable fund, which went back to the 70s, had never had a trick like this pulled on it.

The big US Government Funds came ringing the bell for some treats, too. Ameriprise Financial Services in Minneapolis is so bugged by this little trick that they’re suing the Reserve Fund over the Primary Fund’s losses, saying management tipped off big investors. Ameriprise has another 400,000 clients with frozen assets (not exactly a frozen Milky Way).

According to The New York Times, a large money fund at Putnam Investments “was also hit with heavy redemption demands the week of Sept 15. But it promptly froze the fund and sold it to Federated Investors with scarcely a glitch in customers’ access to their money.” Nevertheless, don’t let these little tricks spoil your Halloween. Although you might want not want to go too heavy on your credit spending (Halloween is one of our biggest spending holidays) this year.

Lenders wrote off $21 billion in bad credit card loans in the first half of 2008 as borrowers defaulted by the barrelful on payments, dunking for cash apples to pay. Another $55 billion in losses are on the way, no treat at all. Total losses amount to 5.5. percent of outstanding credit card debt and could top the 7.9 percent bust of the dot.com bubble in 2001. There’s always a trick for the treat. So it goes.

No wonder the economy got a stomachache in the third quarter

Yup, the economy shrank at a 0.3 percent annual rate in third quarter, sharpest contraction in seven years as consumers cut shelling out bucks and business cut investment, sniffing a recession in the air like the burning of fall leaves. Yup, this is hardly a Halloween for fun and games, what with job losses, shrinking gains from stocks and investments stressing people out. Reality has become a kind of terrifying day/nightmare mainly for the adults.

Cuts came on cars, too, and furniture at 14.1 percent annual rate this third quarter, biggest in this durable goods sector since 1987, the bad old junk bond era. Car sales are stalled, you could say, pardon the bad pun, but then the whole economy is kind of a sick joke on us. Nondurable goods, food and paper products, had their sharpest drops since late 1950. Those were the days. I was 12 years old, living in Williamsburg, Brooklyn, pelting girls with stockings full of chalk, throwing eggs at the library and ringing doorbells on Halloween. Ah, but I’ve come a long way, sort of.

Now, while I write on the computer, I can just cut away and watch my investments melt like ice cones. After all, I got $5,000 for my $10,000 worth of Lehman bonds. And $1,350 for my $10,000 in Fannie Mae preferred stock and so on. I figure maybe with what’s left I could open a pizza stand, or go to work for Barnes & Noble or Starbucks like Michael Gill (the former New Yorker editor’s son) and see the light and glory of the service economy. See his book, How Starbuck’s Saved My life, that is, when he got fired as a creative director from J. Walter Thompson and found himself out on the street, too old to come back, in his $2,000 Brooks Brothers’ suit.

Well, I never had a $2,000 suit but I can identify with getting kicked on my bum as a creative director for Grey Global (formerly Grey Advertising) in 1993, not too long after my father passed from Alzheimer’s and I decided to write “other things,” plays, poems, Internet journalism rather than go nuts. It’s been great. Well, so trick and treat, right, that’s Halloween, that’s life. No time to dawdle on the negative and/or the crooks and their greed that got us there. Time to pick ourselves up by the old bootstraps and make this damned country work again, maybe like Nathan’s hot dog stand in Coney Island.

Or maybe I’ll call Bill Ayers, see how he’s doing. Or join Reverend Wright’s congregation as the token white guy. Hey, you never know what’s around the corner. Maybe even a few fun days before the lights go out. Or maybe I’ll watch that DVD again about how they bankrupted Argentina in 2001 and the entire populace took to the streets in one giant crazy Halloween parade that lasted for years and years.

PS: Don’t let me bring you down, kids. Halloween is always a great night. Get yourself a costume or some face paint, climb out of yourself into a new identity. How bout Che Guevara? Jason Bourne? Robin Hood? Sitting Bull? Neo from The Matrix. Or, if you want to be really scary, try John McCain, Ronald Reagan, Richard Nixon, Lyndon Johnson, Henry Kissinger, even old pointy nose, David Rockefeller. Just open up your history books and pick one. And watch yourself scoop up a ton o’candy. Trick or treat! Tell mom and pop to vote!