Bailout didn't pass...Follow

Yeah the Dow has gained almost half the losses from yesterday. Its a holding pattern though, methinks. They're still waiting to see if this bailout will happen in another form.

Ah. I did not miss it. I'm not saying that this is the right thing to do. I'm simply saying it would work, whereas your detailed suggestion would not, see above, at least within my understanding of the crisis.

Please try to read my posts. I tire of repeating myself for the benefit of your rather limited abilities.

Sincerely

yossarian

you people miss the whole point of free market. gbaji and knocksouth included.

washington does not need to do ANYTHING. the market will correct itself all by itself.

1. foreclosures. keep people in their home? why? why would anyone but the bank think keeping someone in a home that they cant afford be a good idea? why would anyone think keeping someone in a home they owe 400,000 dollars on when its worth 250,000 would be in any way GOOD for either the person in the home or someone who might want to buy it?

let it go. stop making payments. it will take a good 90 days before you get the boot. thats 3 months worth of payments you can save for the first, last, and security on rental housing.

the house goes back to the bank that made the BAD LOAN, and THEY EAT the rewards of their efforts. eventually, the house comes back on the market and sells for what the market.....us.....can afford. its true value. or the bank goes bellie up because they made a whole lot of bad loans and its assets get bought by another bank. in which case, the house eventually again ends up on the market and sells for its true value.

2. 401k plans. if you want security, buy bonds or cds. split them between banks in accounts worth 100,000 or less so your assets are 100 percent insured. if you are going to play in the market for the FAT LOOT, guess what, sometimes you LOOSE. this is one of those times. and even now, you still have 100k insured of those assets if you were stupid enough to put them all into one account to begine with. they will go back up AFTER the market burns off all the artifical FAT from the tons of borrowed money shoved into it since the 2000 tech stock bust.

3. home loans. yes, the banks are nutting up. rent for a year or two then try again.

4. car loans. guess what? ford WANTS you to drive their cars. even of the banks wont loan you the money, you can bet ford will even if they have to create their own finiance company......oh wait.....they ALREADY HAVE ONE. i promise you, you will be able to finance a car with no more difficulty than you experienced 2 years ago.

5. bussiness loans. by by. if your bussines was so tight that you had to borrow money to meet payroll, you DESERVE to go OUT OF BUSSINESS. i promise you, supply and demand will fill the gap you leave like taking a finger out of a bucket of water. if BF Goodrich goes bellie up and closses all of theri tire stores, bobs rubber co, a mom and pop start up will jump right in and start making tires and selling them for LESS MONEY becuase they wont have the stupendious overhead you had. demand will create bussiness where big corperations fall nad leave gaps where money can be made.

6. airlines. by by. but dont worry, some small company will buy those planes at a DISCOUNT from the auction block and be flying them within a year of them going bellie up. probably, again, at a PROFIT because they will be smarter about creating stupendious overhead.

7. lost jobs. your company sucked. too much overhead, too little liquid cash, too many fat CEOs sucking up the profits like they suck on those fat stogies at the mens club after hours. find another one. i hear there is a start up airline and a mom and pop tire manufacturer looking for some good workers.

8. the people. 90 percent of the people in this country dont have over 100k in assets sitting in a bank. 90 percent of the people in this country wont loose a dime if ALL of the banks went bellie up. they might have to make a career change to a better run company, but they are not going to loose theie lifes savings.
------------------------------------------------------------------------

so why the bail out?

so the fat CEOs who have been sucking the profits out of YOUR POCKET can keep sucking up profits. its to save those who have. not the other 90 percent of us who have little to nothing.

LET IT FALL. the market will take care of us as it has always done. we are industrious. and necessity os the mother of al invention, inclusing filling gaps left by closed bussiness.

repubs want a free market. dems want a free market. lets have a free market.

Edited, Sep 30th 2008 4:18pm by shadowrelm

Gbaji, I don't mean to wake you up from your alternate reality where everything is black and white, but you're wrong on almost every single front.

The CRA applies only to member banks of the Federal Reserve. The Act itself states that loans must be made within good lending standards, and more importantly, does not require the loosening of underwriting criteria. Studies have shown time and time again that banks that are subject to the Community Reinvestment Act were much less likely to originate high cost mortgage loans for the purchase of an owner-occupied home than other types of lenders. In fact, until recently, the GSEs were doing really well, with a robust market and with sound lending.

The problem started when Wall Street banks that were not bound by the CRA decided to enter this market and profit from it. This was known as "predatory lending". This is when things started going wrong. There's a lot more to it than that, but here are a few figures to show that CRA did not cause the bubble and subsequent crash:

- CRA banks are 66% less likely than other lenders to make a high cost loan and 58% less likely than other lenders to originate high cost loans to low and moderate income borrowers.

- CRA banks are twice as likely as other lenders to retain originated loans in their portfolio. The process of loan originators selling off mortgages and servicing rights, is a major contributor to the weakening of underwriting standards.

This CRA stuff is fairy tales. I understand you guys are scraping the bottom of the barrel in order to demonstrate that all of this is anyone's fault by the Republicans, but it's an outright lie. Either that, or a complete and willfull ignorance of the facts. Read the studies I linked above.

I don't think the blame, if we have to apportion blame, can be placed on a political party. The "problem" was the incestous relationship of the financial sectors. Regualtors being employed by the people they were meant to regulate, for one. Risk-assessment systems that fundamentally flawed and short-sighted. A culture of short-term profit above long-term stability. And obviously, a system that rewarded short-term gains and greed to such an incredible extent (see bonuses and salaries). The system as a whole was flawed, and it's not the first time we see a bubble created by specualtors and the imperative of short-term profits explode, leaving ordinary people with a huge debt to pay.

What can be said, though, is that both political parties had a vested interest in keeping that system going. The Republicans were especially keen to prevent regulation or oversight of that system, and it's impossible to deny that whenever someone suggested stricter oversight or regulation, they were shouted down as "socialist" or "pinkos" or whatever. We were all told that the system didn't need oversight, or regulation, and that such measures would be counter-productive. If the recent events have shown anything, it's that market forces cannot produce long-term sustainability if left all alone, without regulation or supervision. Market forces are not "magic". Not only that, but the Republicans have been in charge of the US for the last 8 years, or more if you count the Rep Congress under Clinton. They did nothing to address this problem, probably because they had no clue as to what was happening. It's either ignorance, blind faith, or carelessness. As the governing party, they cannot be blameless.

It's not exclusively their fault, obviously, but with power comes responsibility, and they didn't do anything to address this incoming crisis. So, for once, grow some balls. Stop blaming CRAs or poor people, and admit that this stuff happened under your watch, and that you simply didn't see it coming.

Congress just swapped to Democrat majority at the last elections.

Sorry, I lost you there. From what I understand, and I might be wrong, Congress has been Democrat since 2006. I make that 2 years, unless we're suddenly in 2014, and in that case that was one hell of a long lunch.

Meaning Congress has been Republican from 1995 to 2006. There were a few changes in 2001-02 because someone changed from being a Republican to being indepedent, but that's about it.

Again, I'm not saying the crisis is the Republican's fault, because I don't think it is. But if we're playing the political party blame game, surely it's a bit rich for the party who's been in power for the last 8-11 years to point the finger at the opposition. I do think the politicians in general are to blame, if only because they happily agreed to "let the market forces" have complete control of this process, which involved people's houses, insurance, and savings. I think that's borderline cirminal, but no politician could say that back then without being labelled a pinko commy. But fundamentally, I thinkthe whole system was poorly designed, and that the people in charge of regulating it acted like complete pussies.

September 24, Chineese regulators have told domestic bank to stop interbank lending to U.S. financial institutions to prevent possible losses during the financial crisis....

China stop lending money to our overextended bank....so they need our 700 billions taxpayers money to save their Yachts and Mansions. The bankers won't rest until they get our money, sad but reality.

Knoxy, linking some retardedly partisan paragraph linking mortgage-lending to teaching poor people to hate America is not really the most convincing of arguments.



Right, so we at least agree there needs to be some regulation?

Or do you just let the business fail, having miscalculated the risk, and do what you can to protect those affected by the failure?

That's why I added the last clause.

I don't care if Lehman Bros. failed. They assessed risk, they took risk, they flubbed.

I do care that their investors be protected as much as is possible.