Let it crash

I don't think your Friday would be all that much different than your Thursday unless you planned on retiring on Friday, or the company you work for was borrowing money to pay your paycheck, or your bank called in all of your outstanding debt to help cover their bottom line, or you needed to get your hands on any investment capital in the next... years probably.

The fallout will come to those who carry debt, who work for companies who carry debt, who don't have sufficient liquid savings to cover their outstanding debt (including possibly first mortgages and credit cards), or who planned on having investment savings available for retirement.

since none of the regulars want to expose my naked ignorance I wish to dress myself with apt cut and pastes.
the following quote is partially my views.
The difference is british English and not American one.

Richard Milhous McCain

Sep 18th 2008
From The Economist print edition
Americans cannot escape from the shadow of Tricky Dick

Yet the Republican Party’s decision to rely so heavily on Nixon’s 1972 template is nevertheless depressing. Aren’t Republicans supposed to deplore the politics of victimhood? Conservatives make a good case that treating minority groups as victims diminishes America and institutionalises dependency. But when it comes to election-time they not only play the politics of victimhood, but play it with extraordinary relish, presenting ordinary Americans as the victims of diabolical conspiracies.

Haven’t Republicans done quite well when it comes to power? They have controlled the White House for 28 of the past 40 years, and have a solid majority on the Supreme Court. And aren’t Republicans rather good at getting their message across?
http://www.economist.com/world/unitedstates/displayStory.cfm?story_id=12260881

there is another article from the same source.
American finance
And then there were none

Sep 24th 2008 | NEW YORK
From Economist.com
What the death of the investment bank means for Wall Street
http://www.economist.com/finance/displayStory.cfm?story_id=12294688&source=features_box_main

That's good to know. Thank you.

I'm debt free outside of another two years on my car (through Ford - not a bank), and a few medical bills I'm paying off. Ford doesn't want my car and the hospital can't take back their X-Ray or bloodwork results.

Other than that, I bank with a Canadian bank.

Just send me my $2300 part of that bailout. I'll spend it and help the Big Boys recover that way.

I've never argued that it's "fair" ci, just prudent. No matter what is done it won't be "fair" to someone.

sqinney, That's the 64-thousand dollar question. The congress was asking questions about that very issue about this bailout about overpaying or underpaying for these assets. Who will determine "fair" value before the $700 billion is spent? How and who?

Does the government own those properties outright, or is that money being spent to provide liquidity to the market place so others can buy it?

The question of "real" value then becomes an important issue.

It's a tough call no matter how they program this money. There will not be easy answers in how this will end up helping the American People.

How long will it be before this bailout funds are recouped?

"Oversight" is an over-used term when our government spends our money.
An oxymoron as such.

One of the American has this pognant, piercing, penetratic pure English.

But whatever final form this bailout proposal takes, and however it is implemented by this Administration and the one to come, I think it is absolutely critical to maintain a clear distinction between saving the American (and global) financial system from catastrophic lockup or breakdown"which should be the point of the whole exercise"and pulling any one (or more) particular financial institution's bacon out of the fire, which should not.

As an economy, and as a country, we will suffer losses. Sacrifices will have to be made. And, like in any war, it should be the soldiers on the front line who bear the brunt of the damage.

Let me be clear: financial ruin and calamity for some, if not many, market participants should be completely understood as a likely and perhaps even desirable outcome from this godforsaken mess. There is no reason on God's green earth why Goldman Sachs, Morgan Stanley, or even Citigroup cannot and should not be allowed to fail completely, utterly, and without a trace. (And to reassure you I am not being partisan, I would remain unmoved if outfits like Cerberus, PIMCO, and KKR went down the tubes as well. I just tend to think they are at far less risk that the traditional financial intermediaries currently on the firing line.)

These firms, and the people who run them and work for them, have been living by the sword for a long time. It would be no great American tragedy if some of them died by the sword today.
http://epicureandealmaker.blogspot.com/
This is my view though not popular in USA

I'm out. The last time an American president took that approach, it eroded the very fundaments of democracy in Germany in China, delivering Germany to the Nazis and pushing China into civil war, and later into a mass-murderous communist dictatorship. America ended up not just with the Great Depression -- it also had to fight the second world war to get rid of the Nazis. China's communists, meanwhile, continue to be alive and well, if somewhat less communist than they used to be.

Thanks for the suggestion, but I'd rather bail out some banks.

Good point.

Latest proposals seem to be $150 billion rather than $700 billion, meanwhile -- still a hefty chunk of change but a little less staggering.

that was the strategy that bankrupted a former employer of mine

But Paulson is asking for $700 billion. Whether the congress will comply is about 60-40; a good chance he'll get what he asks for.

I'm out. I won't go into great detail. I know a bit about economics. I have written about this on various threads.
The Bush plan has a number of flaws. But the idea of doing nothing could have dire consequences. The scoundrels who got us into this would get their just deserts but the potential damage is huge.

Democracy is elsewhere but never in USA. USA make use the word Democracy, freedom of speech, Humanrights as a slogan to make the ill-informed Americans to uphold the flag and seek 3 or 4 different jobs to buy some potatoes to munch while they are watching the corporate media to forget about their future..
Anyone who is up in arm against any other system but allowing those bail outs for the miscreants and discarding the innocent citizens are either blind or ill-equiped to be a regtular chatter of A2K

"cutting off the nose to spite the face" comes to mind...

right. and the problem is that you buy a house for 850k. today it's worth 650k. if the thing keeps falling apart, you could wind up on the hook for 850k while living in a house that's eventually worth 450k.

since a lot of people have bought a house with the long term goal of selling it at retirement, moving to a smaller home and using the profit as retirement, in the long run there'd be a lot of folks who did nothing wrong paying out the ear for it.

don't see how that's helpful.

luckily, we bought low at the end of the bush sr. financial stinker. we'd have to have a total failure of the system to get bit. however i just inherited a nice house back east. i have it rented, but my plan was to sell next year. that seems unlikely right now.

it just seems to me that some people here are seeing letting it go up in flames as a way to punish the cigar chompers. but in reality, those guys are always landing on their feet. it's not just the poor that will have their situation worsen; a lot of middle class people who have worked hard all of their lives have been takin' it in the neck for a few years now with the loss of pensions, health benes and such. letting the banks fall apart will only serve to blow away whatever security those people have left. not that it would be easy to get an equity loan. umm, maybe it is, i dunno.

there's no denying that the problem is spooky. part of the spookiness is that as usual, bushy has waited till the last possible second to pay attention; this is when he always suddenly jumps up and starts yelling "we have to fix it now! now! now!". that's part of how we got in this mess to start with.

barack has a more measured view that we shouldn't jump out of the pan into the fire. we do need to stop the dominoes, but we will be better off if we actually stop the bike and get off before trying to fix the tire this time.

sorry for the metaphor bananza.

um-hmm..

I'm out. To do nothing carries an enormous risk of losing everything. To keep the boat afloat long enough to give the economy time to correct itself appears to be the only option we have at this time. With the economy stablilized and property values appreciating again, many of the bad loans can become good loans and the net loss can be minimized.

Our current elected leaders did not do all of this to us, but they are responsible for failure to exercise oversight. And that includes the House and Senate oversight committees, the White House, and applicable regulatory agencies. They are are all liable for not seeing it coming and stopping it. They did nothing to correct it while there was still time and they did nothing to warn us. I think the fact there there are no mass calls for investigations and hearings and special prosecutors tells us they all know they are guilty.

So now our only hope is to forestall a total depression and try to return as much bad debt to solvency as possible. The Federal government is the only entity with the wherewithall to do that.

And hopefully they will never again allow financial institutions to encourage risk free investment. There is no such thing.

who would that be? My understanding is that there are no regulatory agencies charged with the oversight you're talking about for this industry.

true. and not only that, because a lot of people were qualified for loans way beyond their means and those nutty balloon loans, eeeesshh.

there's a need for some serious regulation and full review of what is and what isn't ethical.

the risk free myth is bad enough. the myth that you can afford to bet with scared money is even worse.

I'm buying guns and ammo. Never lost a penny on either.

Republican Congressmen Tell Paulson Ballout Won't Pass

House Republicans warned Treasury Secretary Henry Paulson today that his $700 billion financial rescue plan wouldn't pass and asked for more time to consider alternative ideas, lawmakers said.

``The $700 billion bill is simply not going to pass, and they recognize that,'' Representative Ray LaHood of Illinois said after Republicans met with Paulson behind closed doors at the U.S. Capitol today. ``Now it is up to Congress.''
http://www.bloomberg.com/apps/news?pid=20601087&sid=atiAm2NTIqEQ&refer=home
The congressw is a hen-pecked republican sort.