Bailout or no Bailout

[sentry103]

Do you support the bailout??

[bmwgsa]

Against it - I see no reason to bail out any business where the CEO and other mahogany row exec's get golden parachutes while the working folks get the shaft.

Now, if the law limits the CEO & golf buddies salaries, give some back to the employees, then I might change my mind.....

[Starcadia]

I agree. To pass it, no matter how tempting in this doubtful, anxious atmosphere, would be like enabling addicts; in this case greedy, gluttonous, gambling whores who convinced themselves, and their ilk, that there is in fact such a thing as a free lunch, despite the most fundamental common sense passed down for millennia from an assorted yet consensual array of moralities. And whether we like it or not, we voted for this shit. Boggles the mind, but there it is. Tough love is not fun for any member of a family, but it is necessary for the future. Time to check into rehab.

[TBD]

Better to get the pain over with. A bailout will just prolong the time we have before the correction. Mistakes were made, no reason we the taxpayers should be forced to cover their butts. The economy is going to tank sooner or later anyway. That would be the natural course of events. The gov interfering makes it worse.

[Zero]

I support a protection of personal deposit accounts - everyday people who had their money in the bank should be able to get it back. That's a fair service for the Fed to provide given its integral role in creating this crisis in the first place. Beyond that, let the cocksuckers sink. The entire financial system needs fundamental change. I doubt that change will happen. More likely we'll see more bad regulations which will cause the next financial crisis in about a decade or so.

[RobsanX]

Everyone's savings is insured up to $100k... I just got a new car, and I'm not looking to buy a house for a while... I'm young, so my 401k can stand a hit...

I say no bailout... These greedy lenders rolled the dice, now it's time for them to pay the price...

[Premium Parrots]

Well I'm not sure how I feel. I have a home in Mesa Arizona that I've beeen trying to sell for 18 months with no results, even at a greatly reduced price. That sucks big time.

And I have a home in Illinois that I will be selling as soon as the home in Ariizona sells. Then we can move to Georgia. The housing market is way down and ya can't sell a house for anywhere near its normal value.

My other problem is that I am cash poor. I don't have much liquid cash but both homes [and 3 vehicles] are paid for and I don't have any loans . So thats a good thing. But I'm stuck in limbo and can't relocate untill this housing market comes back somewhat. I'll probably just rent the Arizona house in the meantime.

Another problem is that ALL MY FREAKING STOCKS AND MY IRAS aren't worth crap now. I've lost alot of $ and currently my, near future, retirement is on hold untill things turn around.

I agree that the bankers need a reality check. So f+*k them but not putting this bailout thru can hurt alot of people like myself too. Its kind of a catch 22.

As it is Social Security benefits might not be available when I apply for them. And all you young fellas in the USA will never even see a dime by the time you qualify for benefits.

I'm for whatever will help and protect the normal hard working citizen. Screw the bankers but not at the expense for the working class. One of these days we will all hear on the news how someone walks into some financial institution in the USA loaded with guns and ammo and goes postal in retaliation.

George W just couldn't leave office without totally screwing this country up.

FAAAAAAAAAACK
PP






quietly sits here cleaning my guns...........
jk

[bmwgsa]

As much as I would LOVE to blame ol George for this one, I can't. The whole mess began when Clinton signed the de-regulation bills allowing loan companies to go for broke.

It was a good idea, kinda, but wasn't thought all the way thru. It cleared the way for anyone to get a house or whatever - but no one looked at the dark side.

It's like the Tech-stock bubble, not everyone saw that it was reaching critical mass and suddenly Black Monday....

Personally, I'd prefer that the government just stay out of this, the economy has a way of self-correcting if left alone.....

[Premium Parrots]

agreed. This mess was in the works before GW got in office but I'm thinkin this bailout will really screw things up. Its his administration that seemed to encourage it [rather than work on fixing it] and now hes gonna finish us off before he steps down.

[KarlvB]

bwgsa, I can't completely agree with you on that one...

If you read this op-ed by Spitzer (pre fall from grace) you will see what I mean

http://www.washingtonpost.com/wp-dyn...021302783.html

and this one in the WSJ by Bob Davis, Damian Paletta, and Rebecca Smith

http://online.wsj.com/public/article...456283007.html

And the bail out is not simply about saving the banks who caused this mess in the first place but to jump start the credit markets which, if they continue to be this depressed, has the potential to seriously impact the American and worldwide economy. America in particular will see more lay-offs in all sectors and probably another rate cut from the Fed.


I would suggest reading this to understand the role of derivatives in all of this and why Buffet hates derivatives so much.

http://www.amazon.com/Traders-Guns-M.../dp/0273704745

Here is a choice quote by the man "When we make a mistake in making or buying a loan, it costs us money, not some buyer thousands of miles away who ends up with an RMBS, CDO, or (horror of horrors) a CDO squared."

[Zero]

^ The problem with that is that it just won't work. The bailout doesn't fix the fundamental problem - it's a knee-jerk reaction. Centrally administered currency, bankruptcy protection, and central control of interest rates is what caused this problem. The system provides governments with a significant source, if not the majority, of their economic power. This is just a desperate attempt to retain that power, as far as I can see. Even the Treasury spokeswoman said (on the $700bn package):

“It’s not based on any particular data point,” a Treasury spokeswoman told Forbes.com Tuesday. “We just wanted to choose a really large number.”

They haven't a bloody clue what they're doing. They don't know what's wrong, they don't know what caused it, and they haven't a flipping clue how to fix it. Throw money at the problem - that was Keynes' "final solution". A bailout wouldn't fix the problem any more than plugging a hole in your petrol tank with bubblegum is a solution. We need to have this recession to correct the imbalance. It will not be a jolly ride, but a bailout only defers the inevitable into the future.

[bmwgsa]

I didn't mean to sound like I was hanging all this on Billy or George - there were a lot of things that had to line up for all this to happen.

The Fannie/Freddie mess was the major contributor (with the help of the government's guarantees), but we the people and the changing face of the world economy all added into the mess.

I don't see where 700bil is going to help a thing other than make it worse in the long run. It's like continually putting patches on a leaky ball - eventually you just can't get anything else patched and the ball goes flat.

While I don't really have an answer, I certainly don't want any kind of bailout to help the CEO's/CFO's and the like to walk away with millions while Sam and Sally Smith get thrown into the street because of corporate downsizing - and that's what's going to happen under the current plan.

The rich get the goldmine and the rest of us get the shaft.

Now, if in the bailout there are provisions that help the workers keep their jobs by forcing corporations to bring salaries into line or something that's built in to help corporations keep jobs rather than laying off (or even extend jobless benefits), then I say START THE PRESS, crank out the cash...

[KarlvB]

The bailout doesn't fix the fundamental problem - it's a knee-jerk reaction. ......They haven't a bloody clue what they're doing. They don't know what's wrong, they don't know what caused it, and they haven't a flipping clue how to fix it.

Agreed.

You are right in that it is a temporary solution to a much bigger problem, but the markets are so jittery now that a major initiative like this may just calm it sufficiently so that we don't see more silly runs on institutions that are financially sound and allowing the market to correct itself.

Zero, I would be interested to hear your alternative to the bail out and the centrally administered currency system/interest rates, bankruptcy protection, etc.

[KarlvB]

While I don't really have an answer, I certainly don't want any kind of bailout to help the CEO's/CFO's and the like to walk away with millions while Sam and Sally Smith get thrown into the street because of corporate downsizing - and that's what's going to happen under the current plan.

The rich get the goldmine and the rest of us get the shaft.

Now, if in the bailout there are provisions that help the workers keep their jobs by forcing corporations to bring salaries into line or something that's built in to help corporations keep jobs rather than laying off (or even extend jobless benefits), then I say START THE PRESS, crank out the cash...

Agreed on all those points. I took a couple of days off so I haven't read too much about the version that got turned down in the end, but as far as I understand they did want to insert some clauses that would limit executive pay and stagger the availability of the bail out funds - three tranches or something

Sweden actually offers an interesting example of how such a crisis can be managed.

http://www.creditwritedowns.com/2008...nse-model.html

http://www.riksbank.se/templates/speech.aspx?id=1722

[Premium Parrots]

Theres aprox 200 million people in the USA that are over 18 years of age. If they split that 70 billion up there would be $3500 for each.


I'll take my share now please. And my wifes share.