Is the Wall Street Bailout a Scam?

The more this whole Financial Bailout proposal has sunk in, and people have had time to think about it, some people are saying its a scam.

Doesn't it seem that way? Anything Bush and Cheney tell us is an emergency should be quickly second guessed. Doesn't the fact that Bush and Cheney are pushing this Bailout heavily cause us hesitation?

I"m not saying economy isn't in trouble, but is the bailout the answer?


9/11 happened. Patriot Act!!!! Don't think. Sign it!!!!!

Iraq War. War on Terror!!!!! Don't think. Attack!!!!!

Wall Street Bailout. Great Depression!!!!! Don't think. Sign it!!!!!

This is Bush and Cheney last chance to rape the Treasury for as much as they can. They've already stolen trillions with military spending and fake wars, now this is the last grasp at stealing taxpayers money.

Doesn't anyone wonder how all of a sudden they need $700 Billion RIGHT NOW!!!! Don't think, just ACT!!!!!! Give us money, NOW!!!!!!

Why not wait? Even if economy is struggling, couldn't $700 Billion be used to give health care for everyone, help those with foreclosers, extend benefit payments until economy turns around? Why are we bailing out the wealthy?
Something is fishy about this whole thing.........



Some interesting articles on subject:

[url]http://blog.wired.com/27bstroke6/2008/09/treasury-secret.html[/url]

[url]http://dailykos.com/storyonly/2008/9/23/171759/124/260/607908[/url]

[url]http://openleft.com/showDiary.do?diaryId=8451[/url]

[QUOTE]"After reviewing the administration's proposed bailout plan, I believe it is completely unacceptable," [South Carolina Sen. Jim] DeMint, chairman of the Senate Republican Steering Committee, said in the statement. "This plan does nothing to address the misguided government policies that created this mess and it could make matters much worse by socializing an entire sector of the U.S. economy."[/QUOTE]

That's a Republican, BTW....

This whole situation is sketchy.....

its funny as hell because i had a customer at work talk about this when the topic of the bailouts was on the radio. She basically said Bush rushes us to make decisions just like pushing Congress giving him the permission to go to war, but only as an option he had on the table for negotiations mostly, and all of a sudden we're at war :wtf:

Patriot Act was rush rush to push it through too, talking about Terrorists could strike at any minute.

Even getting Congress to push funding for the troops was a rush rush push by Bush, talking about there are troops dyiing without equipment over there.

And now this. Like everybody the day it happened was in a daze but like 'yeah i guess we have to', Bush was pushing we have to get this done now, its urgent, a top priority...and after a day everyone is like wait a minute...at the very least how the hell are you not attaching stipulations to just giving them all that money :ohwell:

[QUOTE=Smokee]its funny as hell because i had a customer at work talk about this when the topic of the bailouts was on the radio. She basically said Bush rushes us to make decisions just like pushing Congress giving him the permission to go to war, but only as an option he had on the table for negotiations mostly, and all of a sudden we're at war :wtf:

Patriot Act was rush rush to push it through too, talking about Terrorists could strike at any minute.

Even getting Congress to push funding for the troops was a rush rush push by Bush, talking about there are troops dyiing without equipment over there.

And now this. Like everybody the day it happened was in a daze but like 'yeah i guess we have to', Bush was pushing we have to get this done now, its urgent, a top priority...and after a day everyone is like wait a minute...at the very least how the hell are you not attaching stipulations to just giving them all that money :ohwell:[/QUOTE]

Smokee, we have a FORUM EMERGENCY!!!!

Don't think, give me Reputation Points....NOW!!!!!.....The whole forum might shut down!!!!!!

Quickkkkkk..........REP ME!!!!!!!!!!!..........:D



I read someone describe this Bailout as a Used Car Salesman who has to create a sense of urgency in order to get you to buy.....LAST CHANCE!!!!! BUY NOW OR ELSE!!!!!!!!

lol rep'd or the forum might've died.

lucky i acted so fast :pimp:

[QUOTE=Smokee]lol rep'd or the forum might've died.

lucky i acted so fast :pimp:[/QUOTE]

Heh heh heh.....sucker......:lol....turns out it wasn't really an emergency....oh well, guess you can't take those rep points back....live and learn.......

Damn you :mad:

so you support when obama proposes bailing out poor people with tax payer money but you oppose when bush proposes bailing out struggling financial institutions with tax payer money????

what is the difference?

[QUOTE=Denali]so you support when obama proposes bailing out poor people with tax payer money but you oppose when bush proposes bailing out struggling financial institutions with tax payer money????

what is the difference?[/QUOTE]

All I'm saying is that Wall Street has a "Heads I win, tails you lose" mentality. All the profits get privatized, all the loses get socialized. Taxpayers don't get the profits when Wall Street is doing great, but they have to bail out Wall Street with tax dollars when they are about to go belly up? Isn't that odd?

I realize Wall Street effects the whole economy....but doesn't this bailout strike you as a sort of "trust us, we need this money or else" scam?

[QUOTE=bagelred]All I'm saying is that Wall Street has a "Heads I win, tails you lose" mentality. All the profits get privatized, all the loses get socialized. [B]Taxpayers don't get the profits when Wall Street is doing great[/B], but they have to bail out Wall Street with tax dollars when they are about to go belly up? Isn't that odd?

I realize Wall Street effects the whole economy....but doesn't this bailout strike you as a sort of "trust us, we need this money or else" scam?[/QUOTE]

Taxpayers do profit from a good economy.. Who do you think those companies employ, who gets to use those businesses? Taxpayers.

Isn't this the same group that brought us the Savings and Loans scam? Are we surprised?

[QUOTE=Denali]so you support when obama proposes bailing out poor people with tax payer money but you oppose when bush proposes bailing out struggling financial institutions with tax payer money????

what is the difference?[/QUOTE]


how is this remotely similar to business failure, and taxpayers bailing them out because the failure could ruin the economy?

taxes have always been levied. other countries tax the rich way more, and have less rich vs poor. but no, the rich in our country want to stay rich with their vacation homes, can't give up that luxury yacht, no way you'll see them drivinig a Honda. No way giving up all of that stuff is worth less poor people suffering, and barely able to provide for their families. Am i right?

If you can't see the difference you're retarded.

[QUOTE=Kumo]Taxpayers do profit from a good economy.. Who do you think those companies employ, who gets to use those businesses? Taxpayers.[/QUOTE]


Not everybody works for the big corporations. Not everyone has their money tied up into they're stocks and retirement plans. Its mostly already well off to rich people that do. Not everyone, nor most people, are directly affected by a big company going under, only indirectly through the economy and maybe trickle down spending. its arguable the effect is has on 'everyone'.

The Great Depression from what i understand was a time where everybody had their money tied up into stocks, and lost their life savings as a result. Today, not many play the stock market anymore. Its been way too volatile, too many CEO scams, ever since the internet boom hits its ceiling and all of the corruption put a bad taste in peoples mouths. Day trading is nothing close to what it was at one point. People have been weary of the stock market for a long time now. So i can't see people losing all of their money from these big companies going under, pretending like it'll be another 'Great Depression'.

Reality is nobody knows how its going to play out either way. Most of you talking about the Great Depression don't know ****. Even the politicians don't know exactly wtf is going to happen if we don't or do. You have the corporates who benefit from that much money being pumped into their investments saying its the end of the world, along with some politicians, and then you have the skeptics, that aren't exactly sure, that want more time to weight the situation. That seems to be where we're at :confusedshrug:

[QUOTE=Smokee]how is this remotely similar to business failure, and taxpayers bailing them out because the failure could ruin the economy?

taxes have always been levied. other countries tax the rich way more, and have less rich vs poor. but no, the rich in our country want to stay rich with their vacation homes, can't give up that luxury yacht, no way you'll see them drivinig a Honda. No way giving up all of that stuff is worth less poor people suffering, and barely able to provide for their families. Am i right?

If you can't see the difference you're retarded.[/QUOTE]


nice tapdance around the question.

but since you're so concerned with people suffering, why are you paying money to have an internet service provider that allows you to sit here on ISH when you could be in Africa feeding starving children? obviously your own greed and avarice dictates your heartless apathy to those children and your own selfish desire to sit leisurely on Teh Internetz.

[QUOTE=bagelred]The more this whole Financial Bailout proposal has sunk in, and people have had time to think about it, some people are saying its a scam.

Doesn't it seem that way? Anything Bush and Cheney tell us is an emergency should be quickly second guessed. Doesn't the fact that Bush and Cheney are pushing this Bailout heavily cause us hesitation?

I"m not saying economy isn't in trouble, but is the bailout the answer?


9/11 happened. Patriot Act!!!! Don't think. Sign it!!!!!

Iraq War. War on Terror!!!!! Don't think. Attack!!!!!

Wall Street Bailout. Great Depression!!!!! Don't think. Sign it!!!!!

This is Bush and Cheney last chance to rape the Treasury for as much as they can. They've already stolen trillions with military spending and fake wars, now this is the last grasp at stealing taxpayers money.

Doesn't anyone wonder how all of a sudden they need $700 Billion RIGHT NOW!!!! Don't think, just ACT!!!!!! Give us money, NOW!!!!!!

Why not wait? Even if economy is struggling, couldn't $700 Billion be used to give health care for everyone, help those with foreclosers, extend benefit payments until economy turns around? Why are we bailing out the wealthy?
Something is fishy about this whole thing.........



Some interesting articles on subject:

[url]http://blog.wired.com/27bstroke6/2008/09/treasury-secret.html[/url]

[url]http://dailykos.com/storyonly/2008/9/23/171759/124/260/607908[/url]

[url]http://openleft.com/showDiary.do?diaryId=8451[/url]



That's a Republican, BTW....

This whole situation is sketchy.....[/QUOTE]

I am totally agreed with you. I am not going to try to pretend that I know a lot about finances, but I seriously doubt just throwing $700 billion into the economy is going to fix the underlying problem which caused all the banks to go belly up in the first place. It certainly is not going to put mortgage paying families back into the millions of homes that have been foreclosed in the past 2 or 3 years.

Its not like Bush has given me any reasons to trust him in the past 8 years anyway.

[QUOTE=Denali]nice tapdance around the question.

but since you're so concerned with people suffering, why are you paying money to have an internet service provider that allows you to sit here on ISH when you could be in Africa feeding starving children? obviously your own greed and avarice dictates your heartless apathy to those children and your own selfish desire to sit leisurely on Teh Internetz.[/QUOTE]


yeah but thats only $39.95 or something. Its not like i have a luxury yacht, 7 homes, 8 cars, and am angry the government wants to increase my taxes to help the poor.

i don't see a tapdance at all. If anything i see you trying to twist things to make it seem like taxing the rich more to help the poor is just like companies failing and the taxpayers bailing them out. When they aren't similar at all :rolleyes:

Go ahead tho, play the exaggerate humanitarianism card, as if people can't tell the difference from someone paying for their cable modem expenditure vs having multiples of houses, cars, boats, maids, etc., and then having to give up some of that :rolleyes: I mean if you really think it'll help poor people everywhere i'll give up that extra $15 and go dialup :pimp:

[QUOTE=Smokee][B] I mean if you really think it'll help poor people everywhere i'll give up that extra $15 and go dialup[/B] :pimp:[/QUOTE]


lol no you won't. and that's the point. you dont want someone else telling you what you can or cant have, and neither does anyone else. rich or poor. and that 15 dollars a month could literally save multiple lives in third world countries. but you have an excuse as to why its not fair for YOU to have to give it up, but other people SHOULD have to give up the cars or boats or houses they have purchased themselves with the money they worked to earn themselves. of course you're always going to put the cut-off line above your reach. thats the true hypocrit spirit.

what you are suggesting is communism. that everyone should have the same amount of stuff. its an impossible ideal. that's why you are such an extremist loony liberal. you dont understand the reality of the real world. you think that if you can dream it, it can be. "imagine!"

your a wack job.

There definitely needs to be oversight on this money spent.

so instead of trying to learn some economy, you're gonna quote someone who also doesn't know much about the situation and just speculate.


I'm just amazed on the fact that instead of learning what is really going on people are just looking for political statements or blogs of others to base your judgment on.




Either way the bailout is going to happen, Republican and Democrat is going to come to an agreement with new legislation and whatnot.

this is not a pretty situation and not something we should ever have had to do, but my understanding is that if we don't do this, that if we allow lending between institutions and institutions to the private sector to freeze up, our economy is in for one major, cataclysmic f--king.

not because of what bush and crew say, but because of what the economists say. because after all, if it was up to the bush crew, they'd probably rather just ignore this and avoid one more crisis that makes them look like dumbasses yet again.

if we do nothing, my understanding is that the whole backbone of the lending sector will collapse, causing a chain reaction of further collapses of other businesses and people in the private sector, all whose business model relies on the movement of money. this is one of the most scary prospects i've ever heard in my life, frankly.

also, remember that the $700 billion buyout is not money freely given- it's an investment in debt, which is a whole major sector of financial trading. it may not be the most desirable investment and we shouldn't have to be making it, but it's not money for nothing.

[QUOTE]There's a suspicious e-mail that's been floating around. Could it be a scam?

---------------------

SUBJECT: REQUEST FOR URGENT BUSINESS RELATIONSHIP

DEAR FRIEND:
I NEED TO ASK YOU TO SUPPORT AN URGENT SECRET BUSINESS RELATIONSHIP WITH A TRANSFER OF FUNDS OF GREAT MAGNITUDE.

I AM MINISTRY OF THE TREASURY OF THE REPUBLIC OF AMERICA. MY COUNTRY HAS HAD CRISIS THAT HAS CAUSED THE NEED FOR LARGE TRANSFER OF FUNDS OF 800 BILLION DOLLARS US. IF YOU WOULD ASSIST ME IN THIS TRANSFER, IT WOULD BE MOST PROFITABLE TO YOU.

I AM WORKING WITH MR. PHIL GRAM, LOBBYIST FOR UBS, WHO WILL BE MY REPLACEMENT AS MINISTRY OF THE TREASURY IN JANUARY. AS A SENATOR, YOU MAY KNOW HIM AS THE LEADER OF THE AMERICAN BANKING DEREGULATION MOVEMENT IN THE 1990S. THIS TRANSACTIN IS 100% SAFE.

THIS IS A MATTER OF GREAT URGENCY. WE NEED A BLANK CHECK. WE NEED THE FUNDS AS QUICKLY AS POSSIBLE. WE CANNOT DIRECTLY TRANSFER THESE FUNDS IN THE NAMES OF OUR CLOSE FRIENDS BECAUSE WE ARE CONSTANTLY UNDER SURVEILLANCE. MY FAMILY LAWYER ADVISED ME THAT I SHOULD LOOK FOR A RELIABLE AND TRUSTWORTHY PERSON WHO WILL ACT AS A NEXT OF KIN SO THE FUNDS CAN BE TRANSFERRED.

PLEASE REPLY WITH ALL OF YOUR BANK ACCOUNT, IRA AND COLLEGE FUND ACCOUNT NUMBERS AND THOSE OF YOUR CHILDREN AND GRANDCHILDREN TO [email]WALLSTREETBAILOUT@TREASURY.GOV[/email] SO THAT WE MAY TRANSFER YOUR COMMISSION FOR THIS TRANSACTION. AFTER I RECEIVE THAT INFORMATION, I WILL RESPOND WITH DETAILED INFORMATION ABOUT SAFEGUARDS THAT WILL BE USED TO PROTECT THE FUNDS.

YOURS FAITHFULLY MINISTER OF TREASURY PAULSON

-------------------------[/QUOTE]

Heh..

From a friend of mine:
I will throw my hat in the ring as a guy who works in finance (and is therefore under suspicion as a crypto-Republican), part of the blame for the current crisis can be be laid at every Congress for the past 30 years. Fannie and Freddie were known as GSE's, for Government Sponsored Entities,and Congress created a regulatory agency just for them (theOFHEO<[URL="http://en.wikipedia.org/wiki/Office_of_Federal_Housing_Enterprise_Oversight"][COLOR=#0000ff]http://en.wikipedia.org/wiki/Office_of_Federal_Housing_Enterprise_Oversight[/COLOR][/URL]>),and set those regulationss.. Accordingly, they were not subject to the same capital requirements that banks regulated by the Treasury. Also, they carried the implicit guarantee that the government would bail out debtholders, meainng they were able to borrow at advantageous rates. This arrangement was satisfactory to successive governments, as it provided a cheap way to increase the rate of home ownership (F&F borrowed very cheaply to buy mortgages, which they bundled and sold as bonds, earning a spread, and vastly increasing the capital available to finance America's homebuying). Anytime a Congress wanted to increase the rate of homeownership even more, they would lower F&F's reserve requirements, and/or raise their portfolio limits. This never seemed like a bad idea, because home prices always go up, right? This becomes a self-fulfilling prophecy, as more cheap money for home-buying flooding the market ends up stimulatng demand, which drives up prices. This was a major factor in creating the bubble in market prices. Granted, what really tipped it over the edge was Wall Street wanting to get in on the action. The big 5 (Goldman Sachs, Morgan Stanley, Merrill Lynch,Lehman Bros, Bear Stearns) were especially eager but were unable to compete with F&F, because they couldn't borrow nearly as cheaply. But, having stables full of incredibly bright, creative, eager, ambitious, and greedy MBA's, they found a solution: F&F only buys prime loans, and won't touch sub-prime, 'jumbo' (over $415K), or 'Alt-A' (no-doc, or 'liar loans'). Thus was born the sub-prime mortgage backed security industry. Add in teaser rate ARM's, mortgage brokers with no interest in the long-term performance of the loans they made, ratings agencies paid by the banks putting together the securities being rated, and regulatory agencies that didn't understand what was going on (and couldn't have done much about it ifthey had); stir lightly, raise interest rates, and BOOM! You have today. But, we do need to look back a realize the role that Congress played in creating the housing bubble. I don't mean just in the 21st century either; generations of well-meaning Senators and Congressmen of both parties have contributed to this, 'cause nobody ever wants to be tagged as that guy who voted against more Americans owning homes.

What cracks me up is that the Bush Admin's proposal was what...3 pages, around 750 words? When I was in high school, I used to write 500-word essays during lunch-time and hand them in next period. I've both read and written longer posts than that on this message board.

What bothers the hell out of me is that that original proposal expressly stated that there would be no oversight over how the Treasury Secretary spends this money. And yet there Bernanke is, lying his ass off, telling Congress that he was for oversight all along. Seems like this whole issue is going to be used as another excuse for the Bush Admin to line the pockets of their cronies, much like how the Katrina relief and Iraq reconstruction contracts went to Halliburton. I used to think our "Representative Democracy" lead to oligarchy due to the dominating influence of money, but under the Bush Admin "kleptocracy" may be the more accurate term.

[quote=Real Men Wear Green]

What bothers the hell out of me is that that original proposal expressly stated that there would be no oversight over how the Treasury Secretary spends this money. And yet there Bernanke is, lying his ass off, telling Congress that he was for oversight all along. Seems like this whole issue is going to be used as another excuse for the Bush Admin to line the pockets of their cronies, much like how the Katrina relief and Iraq reconstruction contracts went to Halliburton. I used to think our "Representative Democracy" lead to oligarchy due to the dominating influence of money, but under the Bush Admin "kleptocracy" may be the more accurate term.[/quote]

I totally agree. One of the things that really scares me is where are the checks and balances that are supposed to keep power from being concentrated? Paulson and Bernanke are getting grilled on Capital Hill, but will it do any good? Does congress have any backbone at all? Or will this go through just like the Patriot Act and the war in Iraq?

[QUOTE]What cracks me up is that the Bush Admin's proposal was what...3 pages, around 750 words[/QUOTE]because the white house can not actually institute the bail out, they can recommend what to do, toss in their 2 cents but they cannot actually pull the trigger on it, the white house can only back the proposal, they can't write it up... that will be done by the feds, the house and senate if they feel it's the thing to do...

[QUOTE=rufuspaul]I totally agree. One of the things that really scares me is where are the checks and balances that are supposed to keep power from being concentrated? Paulson and Bernanke are getting grilled on Capital Hill, but will it do any good? Does congress have any backbone at all? Or will this go through just like the Patriot Act and the war in Iraq?[/QUOTE]
The rumors I see on MSNBC talk about McCain and the Republicans opposing it while the Democrats push it through, so that when the CEO's open their "golden parachutes"/if it doesn't work, the Republicans can point the finger of blame at the left. The Dems, meanwhile, support it knowing this because they don't want to be marked down as the do-nothing party that let the second Depression happen. Basically, they're all spineless cowards more concerned with political power and avoiding blame than anything else.

[quote=Real Men Wear Green]The rumors I see on MSNBC talk about McCain and the Republicans opposing it while the Democrats push it through, so that when the CEO's open their "golden parachutes"/if it doesn't work, the Republicans can point the finger of blame at the left. The Dems, meanwhile, support it knowing this because they don't want to be marked down as the do-nothing party that let the second Depression happen. Basically, they're all spineless cowards more concerned with political power and avoiding blame than anything else.[/quote]

Damn, combine this with what's happening with N. Korea and Iran and it makes you want to go hide under a rock.

actually mccain doesn't oppose the bailout that's just liberal speak... he just wants restrictions placed on it

[QUOTE]"Further inaction is simply not an option," McCain said in brief remarks to reporters, his first news conference in more than a month. "We must pass legislation to address this crisis. If we do not, credit will dry up, with devastating consequences for our economy. People will no longer be able to buy homes and their life savings will be at stake. Businesses will not have enough money to pay their employees."

He called the proposed bailout a "staggering" figure that amounts to a $10,000 contribution for each U.S. household, money that could otherwise be used to rebuild roads and bridges in every town in the country. To protect taxpayers, he asked for a bipartisan board to provide oversight, a plan to recover the money, a cap on compensation for executives of firms that are helped by the bailout and a ban on earmarks on the legislation.

McCain stopped short of saying he would vote "no" if his priorities weren't reflected. He said he was confident the final plan would include them.

While members of Congress have agreed in principle on aspects of the administration's proposal, many Democrats and some Republicans, like McCain, have insisted the plan deny "golden parachute" payments to executives at failing financial firms.

"In any solution, we must see accountability, we must see transparency and we must make sure taxpayers' dollars don't line the pockets of executives," McCain said
[/QUOTE]

[url]http://news.yahoo.com/s/ap/20080923/ap_on_el_pr/mccain[/url]

just got met by the post above, but again, where is anybody else in this thread acknowledging the consequences if we don't do this bailout?

look up what the experts say would probably happen and tell me if that sounds like a rosy picture.

[QUOTE=gts]actually mccain doesn't oppose the bailout that's just liberal speak... he just wants restrictions placed on it[/QUOTE]
We've already stated that it's just a rumor. What is a fact is that he hasn't taken a stance for or against it (while, of course, criticizing Obama for not providing leadership).

[QUOTE=gigantes]just got met by the post above, but again, where is anybody else in this thread acknowledging the consequences if we don't do this bailout?

look up what the experts say would probably happen and tell me if that sounds like a rosy picture.[/QUOTE]
I'd be surprised if anyone on this board knew for sure what would happen if there's no bailout...mainly because, no one seems to know, period. Jim Cramer predicts the Apocalypse, and he's almost always right, so I believe him, but what I personally find frustrating is that only the well-schooled economists really understand what's going on. The rest of us are kind of clueless and just picking someone to trust.

[quote=gigantes]just got met by the post above, but again, where is anybody else in this thread acknowledging the consequences if we don't do this bailout?

look up what the experts say would probably happen and tell me if that sounds like a rosy picture.[/quote]

Definitely not, and there lies the conundrum. We know we need to do something, but what and when? Why 700 billion? Where did that number come from? Why now and not 6mos. ago or 6 mos. from now?

I just see shades of Bush policies from the past:
Patriot Act: We need to pass this[B] NOW [/B]before the terrorists attack.
Iraq War: No time for debate, we need to act [B]NOW [/B]before Sadam blows us up.

[QUOTE=Real Men Wear Green]We've already stated that it's just a rumor. What is a fact is that he hasn't taken a stance for or against it (while, of course, criticizing Obama for not providing leadership).[/QUOTE]he said he opposes it if there are no restictions placed on it, if they put restrictons in place like he mentioned then he's onboard...
it's called being responsible, you don't just hand a blank check over to a bunch of assclowns who just ran a multi billion dollar company into the ground...

[QUOTE=rufuspaul]I just see shades of Bush policies from the past:
Patriot Act: We need to pass this[B] NOW [/B]before the terrorists attack.
Iraq War: No time for debate, we need to act [B]NOW [/B]before Sadam blows us up.[/QUOTE]
It's the Bushie M.O.: The correct response to any crisis is to quickly pass a bill that no one will examine too carefully because they're all panicked and just want an immediate response. That way, we can give millions and billions more to our rich friends in Halliburton, or (in this case) Wall Street.

One of the things I like most about Obama is that his deliberate, well-thought-out approach is the exact political opposite of Bush.

[QUOTE=gts]he said he opposes it if there are no restictions placed on it, if they put restrictons in place like he mentioned then he's onboard...
it's called being responsible, you don't just hand a blank check over to a bunch of assclowns who just ran a multi billion dollar company into the ground...[/QUOTE]
Actually, he did not say what would keep him from voting against the bill in the three or four questions he's fielded over the last month.

[QUOTE=Real Men Wear Green]I'd be surprised if anyone on this board knew for sure what would happen if there's no bailout...mainly because, no one seems to know, period. Jim Cramer predicts the Apocalypse, and he's almost always right, so I believe him, but what I personally find frustrating is that only the well-schooled economists really understand what's going on. The rest of us are kind of clueless and just picking someone to trust.[/QUOTE]


as a top 10 business school with finance and economic consulting major I would tell you that the bailout is very much needed at the moment.

I think it'd be safe to say that everyone understands that economy works in a cycle through supply demand check writing and check clearing. The biggest problem right now is that we are being f-ucked over from the mortgage crisis. People stopped paying their bills, so all of a sudden the housing market crashed, and the "market value" of all the houses has dramatically gone down. With that, during Spring, just about every single major bank had to had major write down of their assest because all of a sudden the market value of what they have written down as an asset doesn't worth even close to what it was. You can't really say this is "their fault" as they couldn't just predict on the crash of the housing market.

So the value of the firm has gone down, then we have to look at it from the people who are home owners standpoint. What they did was they would own a home, refinance it for a longer term at a lower rate to take that money out and spend it now or pay their credit card. But after that's done, they still keep on spending on their credit card and have outstanding balance on it, but this time the home doesn't worth much anymore, and it's getting to a point where you save more by giving away the house.


The Bank isn't getting the money, the people aren't paying the money, the market value of all the houses has just crashed, so that messed up everyone's accounting badly as well, which is why you have been hearing all these "write down" That isn't caused by over estimating the value of an asset by being affected with what is exactly going on.



So now all the asset value has dramatically decreased, which f-ucked up your asset to debt ration, in which most company uses that as a judgement as to how much cash you need in order for a firm to stay liquid. Since this ratio has gone wrong, most financial firms are now not liquidated enough anymore, because they can't get anything out of their investments.


So unless we help them to liquidfy all those assest, the economy is going down the drain since essentially there will be no money that is being floated around considering financial firms are what keeps the money going, and since the economy is a cycle, if we don't stop the floating of all cash flows, we will stop our growth completely.

from an economy standpoint, the biggest reason on why you wouldn't want to do this bailout is because of inflation. Not saying this isn't a concern, but with the global economy being in recession as well, the demand is gonna go down, so the prices will fall, thus the inflation problem is not as dangerous as the problem we are facing right now.


I hope that clears up some point.

[quote=hwliuLAP]as a top 10 business school with finance and economic consulting major


I hope that clears up some point.[/quote]

Well, you're obviously not an English major :oldlol: , but thanks for the tutorial. Maybe you can help us understand the $700billion figure. Where did that come from?

Thanks for the info, but one thing:
[QUOTE=hwliuLAP]I think it'd be safe to say that everyone understands that economy works in a cycle through supply demand check writing and check clearing. The biggest problem right now is that we are being f-ucked over from the mortgage crisis. People stopped paying their bills, so all of a sudden the housing market crashed, and the "market value" of all the houses has dramatically gone down. With that, during Spring, just about every single major bank had to had major write down of their assest because all of a sudden the market value of what they have written down as an asset doesn't worth even close to what it was. You can't really say this is "their fault" as they couldn't just predict on the crash of the housing market. [/QUOTE]
Isn't that why they have credit checks? They ran one on me just to rent half an apartment, and I know that you get one when you go for a house. The sub-prime insanity is the major factor that lead to the mortgage crisis, and if a bank financed a home for someone that a credit check would have shown was a bad risk then I don't think it's at all unfair to blame them for being greedy for short-term on-paper gains and extreme stupidity. I understand that this can have a domino effect on other businesses that had nothing to do with the foolishness, but the sub-prime lenders definitely aren't innocent in this.

[QUOTE=Real Men Wear Green]I'd be surprised if anyone on this board knew for sure what would happen if there's no bailout...mainly because, no one seems to know, period. Jim Cramer predicts the Apocalypse, and he's almost always right, so I believe him, but what I personally find frustrating is that only the well-schooled economists really understand what's going on. The rest of us are kind of clueless and just picking someone to trust.[/QUOTE]
i think it's very understandable to feel frustrated for that reason. yet at the same time, there are areas in life where we really have no choice but to trust the experts.

just to give a cheap analogy, if we have a warning pain in the abdomen and if we're not delusional then we go see the experts (ie, ER and doctors) and if they tell us that we need the appendix out or else, we trust the experts and get it taken out... again, assuming we're not delusional.

que non?

[QUOTE=rufuspaul]Well, you're obviously not an English major :oldlol: , but thanks for the tutorial. Maybe you can help us understand the $700billion figure. Where did that come from?[/QUOTE]

Two weeks ago Paulson said major government action wouldn't be necesary then he turns around and (in the last week of Congress) asks for $700 billion to spend as he pleases.

Something definitely doesn't smell right.

Wednesday, September 24, 2008

Dear Friends,

Whenever a Great Bipartisan Consensus is announced, and a compliant media assures everyone that the wondrous actions of our wise leaders are being taken for our own good, you can know with absolute certainty that disaster is about to strike.

The events of the past week are no exception.

The bailout package that is about to be rammed down Congress' throat is not just economically foolish. It is downright sinister. It makes a mockery of our Constitution, which our leaders should never again bother pretending is still in effect. It promises the American people a never-ending nightmare of ever-greater debt liabilities they will have to shoulder. Two weeks ago, financial analyst Jim Rogers said the bailout of Fannie Mae and Freddie Mac made America more communist than China! "This is welfare for the rich," he said. "This is socialism for the rich. It's bailing out the financiers, the banks, the Wall Streeters."

That describes the current bailout package to a T. And we're being told it's unavoidable.

The claim that the market caused all this is so staggeringly foolish that only politicians and the media could pretend to believe it. But that has become the conventional wisdom, with the desired result that those responsible for the credit bubble and its predictable consequences - predictable, that is, to those who understand sound, Austrian economics - are being let off the hook. The Federal Reserve System is actually positioning itself as the savior, rather than the culprit, in this mess!