First of all, I’m not interested in an internet fight at all–once again, I post FACTUAL commentary and am PERSONALLY attacked. So if you don’t want to fight, stick to the facts. Second of all, I’m not talking about generic “bailouts.” What I’m talking about in AMERICA is awful legislation that was rushed through, un-read, and has had 1) no positive impact on the situation 2) a lot of cost and 3) numerous unintended consequences. This is the just rewards of government intervention–bureaucrats and politicians are the least qualified people in America to run the financial system and, frankly, to pass laws about anything. The government should have eliminated mark-to-market, gave a verbal backing of all single family loans issued in 2003, 2004, 2005 and through June 30, 2006 with risk share/loss share with the holder of the loan. The government should have been calm, assessed the situation, and passed targeted regulation to fix the problems for the future, and then they should have let the economy go down, let the bubble deflate, cut taxes, increased infrastucture spending in a targeted, methodical way, and let the economy return (as it appears it is showing signs of doing now). Instead, we are getting miles and miles of bad, ill advised legislation. If you care to hear about it, I’ll give you another long list of moronic housing legislation that will do nothing but harm the situation in the long run. In addition, we are getting trillions of dollars in new hard debt that could have been avoided.
Economy runs in cycles. Lower activity leads to lower demand for energy and reduced prices. Everybody saves money on gas and heating oil, shipping goods cost less. The recession is in itself a bailout if you keep your job. Unless your paid as a percentage of assets then it can suck. Sure the govt can keep rates down, cut some taxes, spend a bit on infrastructure that would be needed anyways and help goods flow. People spend less... they pad thier bank accounts and pay down a few debts until they feel like there is enough money in the bank account and it looks like they wont lose their jobs and bada bing they do some discretionairy spending again.
The bailout money was necessary given the situation after Lehman’s failure. What else could we have done?
bailout money was necessary to stop impending bank runs especially at citi and the wachovias and wamus of the world. but this life support that the govies have the big banks on now is making me nauseous. i seriously think they are hiding the fact that these banks are already bankrupt and that they have been for months. same goes for uk government, i’m sure 4/5s of their banks are done. in fact, i think the uk itself is done. how do you take on the bankruptcy of iceland, have bank issues yourself, are already having trouble selling $1billion in bonds and expect to sell another $340 billion in the next 2 years. somebody is going to sink and if it isn’t ALL the bad banks, it will the be the oldest bad bank in the world, the 'ol mother country.
You can have the IMF loan you money to fund your bank bailouts, then have a producing economy and repay the IMF back.
ancientmtk Wrote: ------------------------------------------------------- > You can have the IMF loan you money to fund your > bank bailouts, then have a producing economy and > repay the IMF back. so its basically just another tranche effect eh? the commercial banks go down (highest risk tranche) and it brings down the uk govt, which then brings down the IMF… its not like the IMF has unlimited funds and the funds they hold are just loans from “healthier” economies who won’t have money at one point… eventually, there’s going to be nobody left to hang onto and everybody slips down the slope because of the first guy who was stupid enough to test the effect of oil on a hill. i’m tellin ya, if most banks don’t die, then countries will. we’ve already seen some die and we haven’t even experienced any unemployment or reduction in gdp yet.