Nothing will happen. Well, people will talk about it on tv a lot for a while, or maybe not a while, either way nothing material will happen, I don't think.

Maybe it will, I don't know. I don't even know what I'm saying. Let's simplify - IS NOTHING. PS - Invest in Crocs.

The end.

I am so against this highway robbery by corrupt theocratic business boards that for the first time every I called my congress members and told them I was totally against the bail out. It's a scam by chairmans of the board who think they can "the sky is falling!!" us into giving them $1 Trillion of our tax dollars/purchasing power. NO BAIL OUTS FOR REAL ESTATE FLIPPERS EITHER!

Cons

1.5 trillion dollar deficit, the largest in U.S. history. Deficit causes massive U.S. Dollar devaluation which leads to massive inflation over the next year. Triggering a major recession.

National Debt is almost immediately increased to over 11 trillion dollars which puts us dangerously close to our total GDP which is 14 trillion, this will cause bad foreign specualation against the U.S. and devalue many American assets and bussinesses.

Private bussinesses are effectively nationalized, meaning large ammounts of previously private sector assets is put into the hands of government beaurocracy. The same beaurocracy that got us into this mess in the first place.

The Treasury secretary an appointed position at the behest of the president is giving over a trillion dollars of spending power, with or without an "oversight commitee" I don't know anyone that would say that is a wise road to go down.

Government accountability for this entire crisis is muttled because it's an election year and the next Congress and President will ultimately share blame for what is going down now.

They are trying to rush this bill through in a matter of days. That is unheard of in congress and deffinitely not a good idea for something as important as this. Remember the Patriot Act and all the problems dealing with civil liberty violations that were discovered later down the line because Congress failed to fully vet the bill because it was claimed that it had to be passed immediately? Yeah that took several months to finish. This has been less then a week.

Government is using fear to manipulate people yet again and telling it's citizens to not ask questions and that this is the ONLY SOLUTION. That is never a good thing in to have in a representative government. Representatives should be responsible to the people not the other way around. Forcing this bill through and saying we shouldn't ask questions or consider alternatives is not the answer and history has shown this time and time again.

Pros

There is a chance that this risky plan could work and you would see a near immediate return of banks to lending. However, it is uncertain as to whether this will be good for us in the long run, or if this will even keep these banks from collapsing. The 700 billion (really something like 1.5 trillion depending) is a number based purely on speculation of how many of these bad mortgages are actually in the market. Something like 5% of current home owners.

In otherwords there is a chance this could solve the overall problem in the short run, however they aren't sure. There is absolutely no guarantee of what this is going to trigger in the coming months (i.e. massive inflation).

In other words, this could be one of those cases where the cure is worse then the disease, but we aren't being allowed to ask questions or consider any alternatives.

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Subtleness wrote:
Um... it failed, and there won't be a bail out.

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Yeah I just heard that. They are still trying though. And the Dems want to add another economic stimulus package ontop of this proposed bailout...

We haven't seen the end of this they are still going to try in all likely hood.

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SnappleMan wrote:
The Bad: It enables lenders to continue shelling out loans to people with bad credit without any fear of consequences, and it also enables people with bad credit to borrow money that they can't afford to pay back, and then not pay it back.

The Good: ?????

Actually, I'm a little curious if anyone can come up with an explanation for how this will improve things in the long run.

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SnappleMan wrote:
Don't get me wrong, I can see how this would stop the bleeding for a short time. I just think that in the long term we'll be worse for the wear if this goes through.

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Just FYI if anyone is wondering who Richard Shelby is, he is a member of the Senate committee on Banking, Housing which he chaired from 2003 to 2007. And also chaired the subcommittee of the Appropriations Committee on Commerce.

In other words extremely relevant to the matters at hand.

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SnappleMan wrote:
  in the long run.

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"In the long run, we're all dead"

-J. M. Keynes

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QuinnDexter wrote:

I am so against this highway robbery by corrupt theocratic business boards that for the first time every I called my congress members and told them I was totally against the bail out. It's a scam by chairmans of the board who think they can "the sky is falling!!" us into giving them $1 Trillion of our tax dollars/purchasing power. NO BAIL OUTS FOR REAL ESTATE FLIPPERS EITHER!

 

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You whiney person. It's not a scam, it's Capitalism. And Capitalism says that the rich sucessful people deserve to be rich and sucessful.

In Capitalism, you're not equal to, or as deserving as, those CEOs. They take $2300 from you the same way a large seagull takes many fish from many smaller seagulls. That's nature, and if you're upset because nature isn't fair, try a system where nature is curtailed before making everyone unequal. Try socialism.

If you don't like socialism, you have no alternative left but to respect the nature and pecking order of things. CEO > you

the entire system just seems messed up from the getgo.

every bank is borrowing from every other bank and the way they are making money is by interest? does anyone else see the problem in this? they are trying to create a profit out of nothing. preatty soon that profit just gets so big and collapses, what is happening now.

but it's all invesible money and debts, NONE of it is REAL.

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Krimzon_Alchemist wrote:
This will inevitably make the U.S. Dollar worth even less than it already is.

Can you say "Modern-day Depression"?

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Jeffchao228 wrote:

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Krimzon_Alchemist wrote:
This will inevitably make the U.S. Dollar worth even less than it already is.

Can you say "Modern-day Depression"?

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Well there is plenty of things that come with this, also in turn making the economy worthless, going back to being farmers, maybe learning what the omish did back in the day, and of course religious factors could also play a role that might make things even more bad for the US, but I am not going into that subject.

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that's not going to happen and the reason is what money really is.

money is a representation of goods/serveces served.  the thing that makes it complecated is the world stage, and this is the flaw with having a completely free market.

we can not go into debt for ourselfs, it can't happen. we can go into debt with other countries. 

if our economy collapses, we can start a fresh new one tommorow. what that means however is that the other countries just will not get the money we owe them.

Well that just proves my point. The problem is the borrowing and lending, that ties everyone to everyone else.

We need to be on a gold standard, and no one must ever borrow anything, ever again.

I don't even borrow books from libraries, let alone money, and my house is paid for.

Your friend's invisible man is simply the shadow of anticipation: People expect growth to continue and bank on it when it logically can't continue. People buy houses expecting to pay off the mortgage with rent from construction worker immigrants living in their basements. When there are no more houses to be made everything goes sour and the dominoes start dropping. (That's just one example, but see how expectation of continued growth goes wrong?)

No borrowing? Realistically that means no Economy. Individuals aren't the only ones who borrow from banks, businesses do as well and routinely. It's not even long term debt. Most companies have some sort of line of credit from banks that sure up their cash flows and allows them to be able to pay expenses (such as salaries), when their own cash flows aren't enough to cover them. This doesn't mean the business is bad, because they can eventually cover the loan plus interest, it merely suggests that the nature of some business' cash flows aren't always consistent. If we were to forbid borrowing, these companies would disappear or shrink due to the lack of day-to-day capital. You'd be destorying profitable firms, increasing unemployment, and simply breaking the economy.

In the end, your suggestion just speaks to your lack of education on the issue.

will the bail out help or hurt? i honestly don't know.

but the fear-mongering being used to ram the legislation through Congress is awfully familiar and it smells.

if there is a problem that the government can fix, i'd rather have the government look into it fully and fix it right instead of rushing to judgement & addressing the problem fast.

No borrowing means no economy? Is the economy really so heavilly based on borrowing and lending that it can't survive without it? I will believe you if you tell me yes. But... It seems like a very tenous thing to base a whole economy on. Couldn't an economy be based on Production, of food, electricity, raw materials, etc.? If the economy is really based on borrowing and lending, it probably needs to be torn down and rebuilt on something else.

I don't like being indebted, so I never borrow anything, not even a library book. I have a debit card instead of a credit card. If everyone acted like that, you're saying there couldn't be an economy, or just that the current economy isn't like that?

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aeternus_flammus wrote:

 

In the end, your suggestion just speaks to your lack of education on the issue.

 

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You know I actually have a Bachelor's and Master's degree. If I had known that a graduate degree in political science gives license to lord it over others more than a graduate degree in any other type of science... I would have changed my major very early on.

I also did not realize almost ten years ago, that you can't just wall yourself off after making sure you make enough money to live. Now you have to worry about the economy going to shyt too. And when it does, the dollar will probably be so heavilly devalued that all the money in my mattress won't mean anything either.

Here's something I definitely don't understand: How is it that the last depression is so different than the one possibly coming on now? Why is it that hoarding physical money would have saved you last time, but apparently this time it won't be any salvation? What has changed all that much?

Welcome to Bizarro World.

The Fed came up with a plan to throw money at the Financial companies to shore them up after the mortgage problem looked like it might bring the whole financial house down.

The Pres called together everyone to push the Fed proposal.

The Dems in Congress got behind the plan (Dems bailing out big business?  WHAT?)  but want the majority of Congressional Republicans signing off on it as well, just in case the thing doesn't work - then everyone gets blamed.

The House Republicans stepped in & said, "Wait a minute, the public shouldn't have to foot the bill for this bailout, make Wall Street do it."  (Republicans protecting the taxpayer over Big Business?  WHAT?).

Both Presidential candidates are trying to look like leaders on this & play it to their respective advantages.

The public (so far) is by far against this bailout. 

It will help (for a short while) those banks and lending institutions who put themselves in this mess in the first place.

It will hurt those of us who are going to be stuck paying yet another big government bill.

Not to mention this does nothing for health care...or helping with affordable housing...or making sure the next election is counted right in this state...or getting the construction market moving again...or fixing the *&^%! roads...

beginning with the Reagan administration and even continuing through Clinton and Bush there has been a MASSIVE deregulation of business under the guise of "free market" which is the theoretical optimal market condition based on the idea that heavy gov't regulation of business stiffles commerce (which i and every economist out there believes).   Well, CEOs and bank presidents have taken this opportunity to make investments speculatively and spreading their risk across the board with whatever tricks they are allowed to use so that if one risky borrower defunks on their morgage it doesn't really matter to the company cuz it wasn't their money in the first place that they lent to the borrower.  Well, millions of people have defunked on their morgages and banks have been forclosing houses left and right.  Massive bank failures that we haven't seen since the 20's are occuring.  Banks aren't making any money off these houses anymore so now they don't have any money to make loans or invest or whatever.

The Fed. has bailed out companies before, but the way they bailed out those companies was by buying massive amounts of stock and in return the company pays the Fed. dividends like any other investor.  So far i haven't heard anyone suggest this and i'm not sure if this would work for our current situation.  In my opinion we're boned.  Està porque sé espànol y si mudanzando al Argentina.  Chinga esta paíz, puntan.

Forgot to put my thoughts on the outcome.

Originally, it did appear that the economy could be circling the drain.  But now, whether because this proposed bailout made Wall Street step back & take a breath or because cooler heads are prevailing, I don't think its as bad as it first seemed.  Some stopgap measures have already been put into place, such as a ban on "short selling" for certain companies (which includes the one I work for, thankfully).

I don't think this is the crash everyone feared.  At least, not by itself.  It won't be pretty - but unless something else happens to push the panic button, we'll get through this one.

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NaBraniel wrote:

Nothing will happen. Well, people will talk about it on tv a lot for a while, or maybe not a while, either way nothing material will happen, I don't think.

 

Maybe it will, I don't know. I don't even know what I'm saying. Let's simplify - IS NOTHING. PS - Invest in Crocs.

 

 

The end.

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haha crocs is such a bad investment, especially right now.