Government Bailouts? -Economics Discussion-

M

Mr.Sickles

New member
An economics discussion.

Ok I have to say Damn Republicans.


They want no federal welfare for anything but corporations.

They want the government to "Stay out" until theyre losing money... Then its "Hi uncle sugar-Sam".


Bernie (the head of the Fed) - Did his Doctoral on, and most the reaserch he did in college was on the great depression, and he is trying to avoid another one. The problem last time was the government stayed out of the market until it was to late. So I see his views. I personally would rather pay higher taxes then go through the same B.S. my Grandmother always complained about.


I just think its funny how much money the republicans squander away. The republican party is no more CONSERVATIVE then a strung out hooker. Except when it comes to bible thumping theology (but even still can you say "Gay hooker at airport scandals"). Fiscally irresponsible mess-ups like GW who tanked two companies himself are allowed to helm the wheel of the once all powerful nation.

Our dollar (and you can bet the ENRON judgement on this) will be about as useful as crapping in your own hand in the not so distant future.


You can not just print money.... Mexico tried it... when they paid off the IMF for billions. The peso has been in the can for... well for as long as it matters...

And hell I am all for government inclusion in the "free-market".. I am all for a 30=% tax rate.... BUT ATLEAST give us all the benefits of SOCIALISM... free college... free healthcare... free public transport (would be a dream)...


Anyway... I understand socialism is kind of far off (only kind of).... I just wish the middle-class (if there is one anymore)americans would not have to give out the majority of the funding without receiving the majority of the benefits....



Anyway - does anyone else have an opinion on the government bailouts?:conehead:

What I mean by economics discussion - Are you pro bailout and why? What do you think is going to happen to the dollar and why? and about taxes and why? -
 
I have a feeling this post is going to get pretty heated.
 
I'm not even going to read the whole screed. Anything after 'damn republicans' tells me it is going to be nothing but emotion. That said, it HAD to happen or we would have gone into a depression. No ifs, ands, or buts. Not to mention that the government had an IMPLIED guarantee to fannie mae and freddie mac through SEVERAL administrations.

If you want some accountability on the dem side, let's start with the guy running for president. Obama(and the congressional black caucus) had a big hand in pressuring the subprime mortgage situation. Obama includes at least two of the execs from the failed FNMA and Freddie mac as economic advisors for his campaign. :smilielol5: We can go back into the 90's as well and discuss loosening of regulations that made subprime possible.

Does that absolve the invesment bankers like Merrill? Of course not, but they did package and trade FNMA bonds with the IMPLIED guarantee of the US government and people invested in those bonds knowing there was this implied guarantee. Did they get off scott free? Nope, as of this last weekend when Morgan Stanley and another were given permission to become banks, there are no longer any investment bankers left and some major brokerage houses that survived the great depression are now gone or bought up by foreign companies. I hardly say they were bailed out.

This bailout is really to save the public from feeling this full force. If this had continued, it could have and likely would have lead to a run on banks.

I can go into more details of why this is significant(what happened in the last week) that lead to this action if you like, but I suspect it may be pretty involved for a lot of folks here(don't mean that as an insult since we all have our specialties). As far as my credentials, before I had children I was a broker in one of the larger discount brokerage firms and my other half is a portfolio manager currently with a large corporation(not a wall street firm--corporations usually have their own traders on staff for their cash held and investments). I take his word because he is not normally an alarmist and he's been right on over the last 24 months as things occurred, not to mention he has access to the kind of expert analytical information the public does not. I keep up with this because this is my field of expertise and I have someone in direct connection to it. I only present this because I notice you too Mr. Sickles have some connection and expertise in all this too so you know where I'm coming from when I state the things I have. I do share your frustration, understand that, but I don't think the blame is so focused as we would like to believe and I only bring up Obama in particular because the man is running for the executive office and that concerns me given what's going on and the involvement.

Suffice to say, this had to happen in order to spare the rest of us who have paid our mortgages and done all the right things from getting sucked down into the financial turmoil more then we have. That said, good riddance to Merrill and others who knew the risk they were taken to some extent and helped to fuel with FNMA and certain gov. officials and to those like Lehman Bros. who could have asked for help a couple months ago and thumbed their noses in denial. They both, and others, deserve what they are reaping. Again, this bailout isn't so much for them folks, but for this country as a whole and even the international markets which would have been hurt by this. This stuff in particular, more then almost any other industry, is tied so closely to our economy.

And before you lobby the insults at political parties, it is very important to know how each member of congress, running for office, etc was involved in this over the last several years. Find that out, and then form an opinion on this. If you want the wild technical stuff that made this necessary, I will be happy to give it: it involves the 3 month T-bill, MMKT prices per share, and a couple of other things.

Other then that, cheers. I hate seeing political stuff on a board like this. I go to a political board so I don't have to talk about this stuff elsewhere. FWIW, I know a lot of republicans in denial about this situation too and how bad it was so I think everyone is a little naive to what is going on, not only those who are left-leaning. There's enough blame to go around to for anyone to pin any one party. The thing I keep coming back to though is who helped pressure this situation? That person I do NOT want in the highest office in the land. It would be like putting Ken Lay's accountant up to run for president.

I apologize in advance for being so...outspoken on this. This is something I have discussed over and over the last several weeks with others and sometimes it is like banging my head on the wall and I know that is because some of the things happening are so obscure they don't occur to your average person as being serious if they even know about them at all like the t-bill yield or the mmkt price, etc.
 
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I am far from an Obama supporter see my post to the Mccain vs. Obama.

I am not left leaning. I wish to god that republicans really were the conservatives they supposedly represent. Enough politics.


My wife and I have kept up on this too. I personally think Countrywide should be burned to the ground. As far as the mortgage crisis goes.


I would like to know what you think about the value of our dollar in future perspective. The dollar is down versus every single currency today.

Currencies - Currency Converter & Latest Rates at CNNMoney.com


In regards to int'l markets and our bailout. Yes, there are the major players EU and China who had investment dollars in our system of rolled up bad mortgages. I personally think the bailout is more for the mkt as a whole and less as savior to the american public.

The housing crisis will be in the crapper until average john doe house with 2.5 kids making combined income greater than 70k can get a 250000 house thats actually priced at 250000 with 25000 down and a standard Interest rate. across the board (very generic... not to be exact).

Anyway. I wanted a more economic discussion not so much political, sorry if i came off that way.
 
Part of me says "screw 'em, let 'em fail."

The other part of me fears what would happen to the wider economy if they were allowed to fail.

So, I'll go on record as saying "I don't know."
 
I look at it this way, if you are going to bail anyone out of a bad situation it should be the American People. Companies come and go and even though the impact may be felt without the bailouts, the American People still lose.

Rather than save a company why not try to help eliminate the debt that individual people have? That will stimulate the economy more than saving a company. Less debt means more spending. The bailouts are a temporary solution to a much larger and older problem.
 
angelicrock said:
I look at it this way, if you are going to bail anyone out of a bad situation it should be the American People. Companies come and go and even though the impact may be felt without the bailouts, the American People still lose.

Rather than save a company why not try to help eliminate the debt that individual people have? That will stimulate the economy more than saving a company. Less debt means more spending. The bailouts are a temporary solution to a much larger and older problem.
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Silly Man... the bottom 99% of the unwealthy of americans are not REAL Americans...

the real americans are the top 1% that control the wealth. Once you get that fact down you will be as content as I am to be forgotten.:nopity:

*please note the sarcasm*
 
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angel98 said:
I'm not even going to read the whole screed. Anything after 'damn republicans' tells me it is going to be nothing but emotion. That said, it HAD to happen or we would have gone into a depression. No ifs, ands, or buts. Not to mention that the government had an IMPLIED guarantee to fannie mae and freddie mac through SEVERAL administrations.

If you want some accountability on the dem side, let's start with the guy running for president. Obama(and the congressional black caucus) had a big hand in pressuring the subprime mortgage situation. Obama includes at least two of the execs from the failed FNMA and Freddie mac as economic advisors for his campaign. :smilielol5: We can go back into the 90's as well and discuss loosening of regulations that made subprime possible.

Does that absolve the invesment bankers like Merrill? Of course not, but they did package and trade FNMA bonds with the IMPLIED guarantee of the US government and people invested in those bonds knowing there was this implied guarantee. Did they get off scott free? Nope, as of this last weekend when Morgan Stanley and another were given permission to become banks, there are no longer any investment bankers left and some major brokerage houses that survived the great depression are now gone or bought up by foreign companies. I hardly say they were bailed out.

This bailout is really to save the public from feeling this full force. If this had continued, it could have and likely would have lead to a run on banks.

I can go into more details of why this is significant(what happened in the last week) that lead to this action if you like, but I suspect it may be pretty involved for a lot of folks here(don't mean that as an insult since we all have our specialties). As far as my credentials, before I had children I was a broker in one of the larger discount brokerage firms and my other half is a portfolio manager currently with a large corporation(not a wall street firm--corporations usually have their own traders on staff for their cash held and investments). I take his word because he is not normally an alarmist and he's been right on over the last 24 months as things occurred, not to mention he has access to the kind of expert analytical information the public does not. I keep up with this because this is my field of expertise and I have someone in direct connection to it. I only present this because I notice you too Mr. Sickles have some connection and expertise in all this too so you know where I'm coming from when I state the things I have. I do share your frustration, understand that, but I don't think the blame is so focused as we would like to believe and I only bring up Obama in particular because the man is running for the executive office and that concerns me given what's going on and the involvement.

Suffice to say, this had to happen in order to spare the rest of us who have paid our mortgages and done all the right things from getting sucked down into the financial turmoil more then we have. That said, good riddance to Merrill and others who knew the risk they were taken to some extent and helped to fuel with FNMA and certain gov. officials and to those like Lehman Bros. who could have asked for help a couple months ago and thumbed their noses in denial. They both, and others, deserve what they are reaping. Again, this bailout isn't so much for them folks, but for this country as a whole and even the international markets which would have been hurt by this. This stuff in particular, more then almost any other industry, is tied so closely to our economy.

And before you lobby the insults at political parties, it is very important to know how each member of congress, running for office, etc was involved in this over the last several years. Find that out, and then form an opinion on this. If you want the wild technical stuff that made this necessary, I will be happy to give it: it involves the 3 month T-bill, MMKT prices per share, and a couple of other things.

Other then that, cheers. I hate seeing political stuff on a board like this. I go to a political board so I don't have to talk about this stuff elsewhere. FWIW, I know a lot of republicans in denial about this situation too and how bad it was so I think everyone is a little naive to what is going on, not only those who are left-leaning. There's enough blame to go around to for anyone to pin any one party. The thing I keep coming back to though is who helped pressure this situation? That person I do NOT want in the highest office in the land. It would be like putting Ken Lay's accountant up to run for president.

I apologize in advance for being so...outspoken on this. This is something I have discussed over and over the last several weeks with others and sometimes it is like banging my head on the wall and I know that is because some of the things happening are so obscure they don't occur to your average person as being serious if they even know about them at all like the t-bill yield or the mmkt price, etc.
Click to expand...

All I read is blah blah "expertise" blah blah "expert".

All I know is it's the supposed "experts" that got us into this mess. :banghead:
 
Mr.Sickles said:
Silly girl... the bottom 99% of the unwealthy of americans are not REAL Americans...

the real americans are the top 1% that control the wealth. Once you get that fact down you will be as content as I am to be forgotten.:nopity:

*please note the sarcasm*
Click to expand...

Wait a second, when did I become a girl?
 
Can someone summarize to a non-political person what the heck is going on? This is all over my head... I hate watching the news because the networks are so biased. Can someone break it down.
 
tyrone2003 said:
Can someone summarize to a non-political person what the heck is going on? This is all over my head... I hate watching the news because the networks are so biased. Can someone break it down.
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The only network on US television with a really strong bias is Fox News IMHO. If you don't like watching the endless personal commentary (that IS biased) that seems to dominate US cable news, try reading a newspaper. :coolgleamA:

Anytime a human being is reporting on anything, their own personal biases will color the way they report it, but good writers will work against that to the best of their abilities. Read more than one paper to account for that. The papers I've seen in the US with a fairly strong bias are the WSJ (conservative), NY Times (liberal), the Washington Times (conservative), and the Boston Globe (liberal). Most US papers are full of AP wire stories anyway, so it's the same shit no matter what paper you pick up.
 
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txsqlchick said:
The only network on US television with a really strong bias is Fox News IMHO. If you don't like watching the endless personal commentary (that IS biased) that seems to dominate US cable news, try reading a newspaper. :coolgleamA:

Anytime a human being is reporting on anything, their own personal biases will color the way they report it, but good writers will work against that to the best of their abilities. Read more than one paper to account for that. The papers I've seen in the US with a fairly strong bias are the WSJ (conservative), NY Times (liberal), the Washington Times (conservative), and the Boston Globe (liberal). Most US papers are full of AP wire stories anyway, so it's the same shit no matter what paper you pick up.
Click to expand...

I find it odd how you say to read news papers to get the news without personal bias but then point out the factions they represent.
txsqlchick said:
If you don't like watching the endless personal commentary (that IS biased) that seems to dominate US cable news, try reading a newspaper.
Click to expand...


To break it down simply.


We are on the verge of financial fallout (fallout being a term associated with nuclear war) on an international scale.

The government is trying to figure out a way to stop this from happen (which it did not do during the great depression).

The problem is:

If they pump 700billion directly into our economy we will get a very high inflation period like the 1970's. Inflation meaning the value of the US Dollar will tank and everything in a negetive correlation (when something goes down the other thing goes up) will get more expensive.

If they fail to pump 700 billion into our economy. Not only will our system tank and we will see an even higher inflation period, but some very big EU and Asian markets will tank too. Causing our own depression, and if we were to recover from that depression, because we caused oither global crisis to go to far, other countries wont invest in the United State which is a key source of our economic funding.
 
It really is a lose/lose situation.

What needs to happen next time is more personal responsibility on the part of the American people as well as some accountability from lenders. People shouldnt be approved for something they cannot afford. It's their fault for trying to get it but the lenders fault (in some cases) for manipulating the system to get people loans.
 
angelicrock said:
It really is a lose/lose situation.

What needs to happen next time is more personal responsibility on the part of the American people as well as some accountability from lenders. People shouldnt be approved for something they cannot afford. It's their fault for trying to get it but the lenders fault (in some cases) for manipulating the system to get people loans.
Click to expand...

When you say loans would you say college loans are a big part of the problem? Because I know many people who really couldn't afford to go to college without em, and I'm probably one of them. I'm concerned because I will be re-applying to go back to college and I hope the lenders will still be willing to help. Also, does this new "american economic responsibility" mean the government will be less likely to give away "free money" via things like the Pell Grant?
 
so whats the controversial stuff about the bail out? I heard something like CEO pay? F Those guys if so.

I can't help but feel that bush is bailing out his buddies tho. didnt their greed get them in this situation
 
tyrone2003 said:
When you say loans would you say college loans are a big part of the problem? Because I know many people who really couldn't afford to go to college without em, and I'm probably one of them. I'm concerned because I will be re-applying to go back to college and I hope the lenders will still be willing to help. Also, does this new "american economic responsibility" mean the government will be less likely to give away "free money" via things like the Pell Grant?
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The government has already cut Pell grants to the bone. I'm surprised anyone gets one nowadays.

I think student loans are the least of our worries right now.

RJAZ520 said:
so whats the controversial stuff about the bail out? I heard something like CEO pay? F Those guys if so.

I can't help but feel that bush is bailing out his buddies tho. didnt their greed get them in this situation
Click to expand...

From what I understand a lot of people were upset that the bailout included provisions for saving foreign banks.
 
angelicrock said:
It really is a lose/lose situation.

What needs to happen next time is more personal responsibility on the part of the American people as well as some accountability from lenders. People shouldnt be approved for something they cannot afford. It's their fault for trying to get it but the lenders fault (in some cases) for manipulating the system to get people loans.
Click to expand...

Yep. People failed to keep their ends of the agreements when they took out their mortgages, and didn't have any emergancy plans in the event that they should lose their job. But you're right, it shouldn't have been made so easy for them to have gotten loans.

Either way, if the banks don't get bailed out, it will ultimately be Americans screwing Americans over. It's unfortunate that such a problem came up, but it did, and it needs to be taken care of.
 
I think what the majority of people fail to realise is that this money will buy up assets. Assets that are very low in value. Suddenly buy low sell high is not a good strategy? This will either even out for the tax payers or gain money.
 
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