700 Billion Fails

[Schmids5.3l]

http://blogs.usatoday.com/ondeadline/2008/...s-7.html?csp=34

 

Discuss...whats next, good or bad that the bailout got shut down? Keep it economic and not political... I know that's asking for a lot

[Darkanion]

[dietz4ibanez]

Its the end of the world!

 

Well I dont know a lot about it at least since the fail is the first time that I knew anything about it.. I know its pathetic.. But did we really want to pay more in taxes to help those who cant make their mortgages so that we might come up short in the end?

 

 

But I think that Duke professor has a lot of passion for a revision of this tax bill that failed.. I skimmed through it but some of it is good!!!

 

http://www.wral.com/news/local/flash/3640277/

 

Basically on overview would be that this should have taken place about a year ago and made it so that tax payers would get more for their dollar instead of tax breaks and increased taxes... Sounds kind of redundant..

[svensk]

KILL THE BAILOUT!!

[Chestah]

Every dollar in that bill is a step closer to socialism.

[pennzoil29]

I'm not even going to get started on this shit.

[D&SYukonDenali]

Let Wallstreet, who is acting like a spoiled kid right now throwing a fit on the ground because they did not get the new bike they wanted, suffer through this, they helped cause the mess. Investing 700 B is bad assests was not a good idea for these banks and is not a good idea for the tax payers; 2 bad investments don't make a good one.

 

Experts say the credit market will tighten up if this this bill does not pass, and in my opinion that is a good thing. People/business have way too much credit available to them currently (or at least up until a couple weeks ago). Less credit available will require people/businesses to make better decisions with the credit that they do have available. Is this going to chang some peoples lives, yes because they won't be able to buy everything that they are use too. But maybe those people could not have afforded to buy those things in the first place. Just because someone is willing to loan you the money on credit, does not mean you should take advantage of it.

[tobias]

[D&SYukonDenali]

I'm slow this morning, I don't get the pic.

[VMax2007]

I'm slow this morning, I don't get the pic.

 

IBTL = In Before The Lock

[droopy]

I say let it fall.Imo 80% of people need this reality check.

[Schmids5.3l]

I say let it fall.Imo 80% of people need this reality check.

 

People who bought overpriced houses and people who lent them money for the overpriced houses. Credit is only as good as whatever the credit is being used for, and this proves it. Banks lost their asses because their loans went to houses with half the value of the borrowed money, and when things went south that overly inflated gap between value and purchased price came back to them. But yes it will be a credit crunch.

[DofD]

The bailout bill is a between a rock and hard place piece of legislation, not taking into account the partisan amendments put onto it. One has to look at the bill beyond just the surface numbers and politico spin. Yes, the number 700B is a nearly unimaginable number, but it's just not signing over 700B. With the original bill, 250B was to be distributed to financial institutions that apply for assistance initially, then the next 100B can be authorized by the president to financial institutions if necessary. The last 350B has to be authorized by congress prior to being distributed. Last Friday Washington Mutual failed, this was the largest bank failure in US history, yesterday Wachovia failed, and prior other large financial institutions failed. When large banking institutions start to fail it is devastating to an economy and everyone, the actual damage isn't plainly visible to the average person. One thing that isn't plainly visible is the number of pension funds that are teetering on collapse. Then there are the 401(k) plans that were invested indirectly through the assets of these financial institutions that failed. A question would be, what is the condition of your pension fund and/or 401(k) investments? These failures and at risk institutions don't just have national implications, but international ones too. There are global economic ripple effects to this economic crisis. When a financial institution's assets fail and go toxic, this results in capital losses. Without capital, an institution either can't or won't want to accept new debtors or will charge a premium. Meaning that they will be reluctant to make new loans or mortgages, or will charge increasing interest rates. Now those of us that remember the late 70's and early 80's will remember what happens with interest rates go way up. It's with these economic impacts and more as to why the government can't just let financial institutions fail. The government has to balance this with the economic and tax impacts of funding a bailout of this size. There are obvious general tax implications, and the extra debt load to the government (whose deficit is already massive). These factors have their own economic implications such as increases in the rate of inflation. So the bailout isn't just about bailing out a bunch of Wall Street bankers who f****d up royally who were trying to line their own pockets.

[DofD]

Another point that on the bailout bill that hasn't been widely advertised is that the government would assume the mortgages of many of the toxic assets allowing the debtor to renegotiate the terms of the debt with the intention of avoiding the predicted 2 million more foreclosures in the coming year.

[DofD]

Another point I forgot to mention is that any monies given to a financial institution are to be repaid, it just isn't a free give away. Though the exact details on repayment aren't clear.