Unsettled Economy & The Bailout

[Kalalau]

Lehman Bros. filed for bankruptcy and Merrill-Lynch has been bought by Bank of America. Bloomberg says investors may lose a bundle. This is disturbing, we don't know where this is going or how bad its going to get, but we do know it was totally, absolutely, 100 % avoidable, and we know who is responsible.

[TuNnL]

we know who is responsible.

Though all on Capitol Hill share blame with all involved in the subprime mortage crisis and the New World Order, there are a few individuals in particular (some no longer serving in their political position) who shoulder a significant amount.

[matapule]

Sometimes, things have to get worse - and it appears they may get much worse - before they can get better. Time to hunker down, be fiscally conservative, and get by on just the necessities.

As far as who is responsiblle,........we all are.

[LocalMotion]

but we do know it was totally, absolutely, 100 % avoidable

in all honestly, how what this 100% avoidable?

[matapule]

in all honestly, how what this 100% avoidable?

An administration with different economic policies. The US got what it voted for last time. And we are in danger of voting for more of the same for the future.

Although I am in favor of a small, compact, efficient governement, with as little governement interferrence as possible, we now see what the probelms are with deregualtion of the financial institutions.........irresponsible institutions that are more than willing to gamble with taxpayer dollars. Government bailouts of these companies (including Freddie Mac and Fannie Mae) is not the answer. The fiscally responsible thing to do is to let them go under or figure out their own solutions.

[LocalMotion]

The fiscally responsible thing to do is to let them go under or figure out their own solutions.

In regards to Lehmans, isn't this happening? they are going under with no govt bailout...

Didn't Enron go under, no bailout?

Have you seen the documentary on Enron, "The Smartest Guys In The Room"

[Frankie's Market]

Though all on Capitol Hill share blame with all involved in the subprime mortage crisis and the New World Order, there are a few individuals in particular (some no longer serving in their political position) who shoulder a significant amount.

Some more than others? Sure! As the following op-ed points out.

http://www.sfgate.com/cgi-bin/articl...ED7R12R6CA.DTL

The mortgage swaps distancing the originator of the loan from the ultimate collector were only made legal as a result of the Commodity Futures Modernization Act that former Texas Republican Sen. Phil Gramm pushed through Congress just hours before the 2000 Christmas recess. Gramm, until recently co-chair of the McCain campaign, also had co-authored the Gramm-Leach-Bliley Act that became law in 1999, with President Bill Clinton's signature. That gem, which Gramm had pushed for years with massive financial industry lobbying, destroyed the Depression-era barrier to the merger of stockbrokers, banks and insurance companies. Those two acts effectively ended significant regulation of the financial community, and no wonder we have witnessed an even more rapid and severe meltdown in housing values than during the Great Depression.

Not surprisingly, Gramm was rewarded for his service upon retirement as head of the Senate banking committee with a top position at the Swiss-based UBS bank, which is close to drowning in the subprime mortgage nightmare he helped create. These folks have no shame, as was evidenced when the senator's wife, Wendy, was named a director of Enron, whose roiling of the energy market had only been made possible through yet another provision of the senator's Commodity Futures Modernization Act.

While neophyte Palin can claim ignorance of such matters, that will be particularly difficult for McCain, who as a senator consistently lined up with Gramm in his deregulation crusade. Clearly McCain had not learned much from his previous involvement with the savings-and-loan debacle about the risks to consumers in unregulated banking.

Yes, this is the same Phil Gramm who called Americans who voiced their concerns about the economy as "whiners." This is the same Phil Gramm who, although fired as McCain's campaign co-chair for making that statement, is still being used by McCain as an economic advisor.

Yeah, people can vote for the GOP ticket, if they find themselves energized by supporting a hockey mom they can relate to. But as Robert Scheer pointed out, don't expect her to provide any solutions to the economic crisis we are now facing. And don't hold your breath waiting for John McCain to provide any coherent answers, either.

http://voices.washingtonpost.com/the...f_economy.html

So which is it, John? Is our economy strong, or is it at risk? If you can't even make up your damn mind, how can you provide effective leadership when it comes to being this country's economic steward?

[matapule]

In regards to Lehmans, isn't this happening? they are going under with no govt bailout...

Didn't Enron go under, no bailout?

That is correct, what is your point? I specifically mentioned Freddie Mac and Fannie Mae.

[LikaNui]

Just now on CNN.com:

What financial pain concerns you more?

High gas prices... 48%... 68,163

Wall Street woes... 52%... 72,423

Total Votes: 140,586

[Peshkwe]

AIG is rummaging around to keep from falling down too:

http://www.forbes.com/markets/2008/0...markets18.html

[Frankie's Market]

Here is the bottom line, when it comes to where the Republicans have taken the American econony is the last 8 years when they have been in power:

Inauguration Day 2001/ Now
Unemployment- 4.2%/ 6.1%
Federal Budget- $281 billion surplus/ $357 billion deficit
Federal Debt- $5.7 trillion/ $9.7 trillion
Avg. price of gas- $1.46 per gallon/ $3.84 per gallon

With institutions like Lehman Brothers, Merrill Lynch, Indy Mac, Bear Stearns, Fannie Mae, and Freddie Mac falling one after the other like dominoes,..... with the Dow taking a 500 point plunge,.... for McCain to still say, today, that "the fundamentals of this economy are strong," does he realize how close he's coming to sounding like Herbert Hoover when he said, "the economy is fundamentally sound," while the country was mired in the Great Depression?

Sorry, neocons. The truth of the matter is the economy is clearly in worst shape now than before Bush and the Republicans took over. They blew it, big time. And try as he might, John McCain trying to sell himself as a candidate of change when his party has been in control for the last 8 years isn't going to work. Not when people have very real concerns about rising gas and food prices, falling property values, unemployment, and 401k's.

So I hope that McCain enjoyed whatever bounce he got out of his convention and the novelty of Sarah Palin. Sooner or later, the reality of this messed-up economy will not work in his favor.

[LocalMotion]

That is correct, what is your point? I specifically mentioned Freddie Mac and Fannie Mae.

My point is (first this thread was about Lehmans) most of these companies have not been bailed out and have done the fiscally responsible thing in letting them go under.

Freddie/Fannie, is a whole different thing and the last resort for that situation was a bailout.

They're not just going around bailing out all the companies that are running their businesses badly.

I'm not writing in a condescending tone, so please don't take it that way. i'm just discussing

[Amati]

Sometimes, things have to get worse - and it appears they may get much worse - before they can get better. Time to hunker down, be fiscally conservative, and get by on just the necessities.

As far as who is responsiblle,........we all are.

Your comment # one is right on.

Your comment # two, I beg to differ. I am not responsible. I work. I pay my taxes. My family is my number one concern (children's education & health, etc). I don't overspend then declare bankruptcy, I pay my bills. I vote. I don't steal or lie or have deceptive business practices.

I am not responsibible for the idotic leadership (or lack thereof) that has landed us all in this mess. Myself, and alot of other hard working people and families, have done our part. Leadership is at fault.

[escondido100]

i have no sympathy for the big wig investors who gamble like drunken sailors with other peoples money and have a history of winning big...making billions on risky deals......treat our economy like a casino and when things go south come crying for a bailout.........if your gonna play you may have to pay....and usually do.....just not with my money......in a few months no one will even remember who lehman was.....they will sort out the balance and life will go on...as a company they will not be missed......the market will sort itself out as it always does and those with money to invest will make a nother killing on the low prices that are now out there....warren buffet wil get richer...the mom and pop investor will get screwed.

[Frankie's Market]

i have no sympathy for the big wig investors who gamble like drunken sailors with other peoples money and have a history of winning big...making billions on risky deals......treat our economy like a casino and when things go south come crying for a bailout.

Crying for a bailout? I don't know what Lehman Brothers CEO Dick Fuld has been saying to the media, but if you saw him crying, that's a pool of crocodile tears he's shedding.

For all the money his company has been bleeding, it sure hasn't led to him missing any meals lately. Over the last 5 years, he's earned over $350 million and was ranked #11 on Forbes' list of the top paid executives.

http://www.forbes.com/lists/2008/12/...d-Jr_A9P0.html

I heard people grumbling about Dick Fuld not deserving any kind of golden parachute for this latest meltdown on Wall Street. I say, forget about that! The feds should investigate this guy to see if he was dumping any stock, a la Enron CEO Ken Lay. And if so, throw that bum in the slamma.

[cyleet99]

I hate looking at my retirement accounts. Guess I will have to rely on the nonexistent Social Security!

[Amati]

I just heard a descriptive quote on the radio, "They built a house of cards based on greed". Yes, that seems to about say it all, folks.

[TuNnL]

I am not responsibible for the idotic leadership (or lack thereof) that has landed us all in this mess. Myself, and alot of other hard working people and families, have done our part. Leadership is at fault.

Apparently you missed a key point in matapule’s dialogue:

The US got what it voted for last time.

So you see, Amati, the American people should live as responsibly as you have. But that does not forgive them (including you) the critical civic duty of electing leaders who will not lead us, as Joe Biden so eloquently puts it, “off a cliff.”

I would submit that voting is the bare minimum in that process. Educating yourself on the issues, donating time and money to candidates, running for office yourself, and ultimately, standing together in armed revolt against your government when it becomes so powerful and oppressive as to contradict the very principles our country was founded on. Geez, I feel like I gave this speech already.

[Amati]

But that does not forgive them (including you) the critical civic duty of electing leaders who will not lead us, as Joe Biden so eloquently puts it, “off a cliff.”

Not EVERONE voted for the current leaders. And, there is little defense that can be put up when suprised by liers and cheats (in politics and business). OK,OK, so none of us should be "suprised" by those actions by politicians. Sadly so.

[matapule]

They're not just going around bailing out all the companies that are running their businesses badly.

I don't intend to give a comprehensive discourse on Federal bailouts since I am not that well versed. However, the Federal Reserve bailout of Bear Stearns comes to mind. There has been talk of the Federal government coming to the aid of the US auto industry. No, the government is not going around bailing out all the companies, just some. I wonder how they get on that lucky list? We, the taxpayers via the Federal government, should not be bailing out one company.

And then there is the "Economic Stimulus" rebate. I lump that under bailouts. You may wish to disagree with my terminology, but it is a governement subsidy, that the US taxpayer cannot afford. Not only is the government bailing out SOME that are running their businesses badly,......The Federal Governement is one of those SAME businesses that is being run badly!

[matapule]

Your comment # two, I beg to differ. I am not responsible. I work. I pay my taxes. My family is my number one concern (children's education & health, etc). I don't overspend then declare bankruptcy, I pay my bills. I vote. I don't steal or lie or have deceptive business practices.

I am not responsibible for the idotic leadership (or lack thereof) that has landed us all in this mess. Myself, and alot of other hard working people and families, have done our part. Leadership is at fault.

When I said "we" it was in the collective sense, not the specific sense.

But, how many of us canvassed neighborhoods, contributed money, demonstrated to protest "W"s second run for office? Maybe you did, but I didn't. Therefore, I am responsible for the last 8 years (even though I didn't vote for him) and perhaps you are too.

And how many of us refused the "Economic Stimulus" rebate check? This is a tax rebate the country can't afford. Even Allen Greenspan says the government can't have tax cuts without corresponding cuts in spending and programs. Yet WE (the collective we) stand in line to accept the handout (maybe you could even call it a bailout).

Despite the fact that most people work, pay their taxes, don't overspend then declare bankruptcy, pay their bills, vote, don't steal or lie or have deceptive business practices; WE are responsibible for the idotic leadership (or lack thereof) that has landed us all in this mess. WE, and alot of other hard working people and families, have not done our part. WE allow the idiotic leadership to be elected. It appears that in most polls WE are about to let that happen again. When will WE have had enough? When will WE put a stop to this?

Yes, WE are responsible.

[matapule]

i have no sympathy for the big wig investors who gamble like drunken sailors with other peoples money and have a history of winning big...making billions on risky deals......treat our economy like a casino and when things go south come crying for a bailout.........if your gonna play you may have to pay........warren buffet wil get richer...the mom and pop investor will get screwed.

And therein lies the problem. People are going to lose a lot of their retirement 401K money. It happened in the late 90's with the "Dot Com" meltdown and it is happening again.

Retirement investors need to be more savvy with where and how their retirement money is invested. The probelm is, WE (the collective we) just aren't that knowledgeable about investing. So, as opposed as I am to government intervention, it appears necessary to have governement regulation of retirement fund investments.

In my opinion, 401K funds should only be invested in a total stock index fund like the Wilshire 5000 (or something similar). This is very conservative investing, but also relatively safe. No you aren't going to strike it rich in the Wilshire 5000 in the short term. But if you are going to try to be greedy by investing in a "high risk" 401K fund, you stand the chance of losing a good portion of your retirement investment. Fiscal conservatism is the way to a comfortable retirement.

[matapule]

I would submit that voting is the bare minimum in that process. Educating yourself on the issues, donating time and money to candidates, running for office yourself, and ultimately, standing together in armed revolt against your government when it becomes so powerful and oppressive as to contradict the very principles our country was founded on.

Alright Tunnl! Maybe you did learn something from us "old folks." I hope you run for office. I can't run, because AlohaKine says I'm too ugly. He thinks Sarah Palin would be a good leader because she is good looking. We deserve the leadership we vote for.

I haven't gotten this worked up about an election since Nixon ran for President.

[matapule]

Not EVERONE voted for the current leaders.

So what did you do to prevent them from being elected... besides vote? I didn't do much of anything, that makes me responsible.

[matapule]

Here is the bottom line, when it comes to where the Republicans have taken the American econony is the last 8 years when they have been in power:

Frankie, your points are well taken. So let's put our collective heads together here on HT and brainstorm a solution. There is a lot of wisdom represented by the members of HT. How can the governemnt fix the economy? WE are the government. What should be done?

I have read Obamas economic plan, I don't think it goes far enough. So Frankie and others who wish to participate, how do we fix this?

So I hope that McCain enjoyed whatever bounce he got out of his convention and the novelty of Sarah Palin. Sooner or later, the reality of this messed-up economy will not work in his favor.

My fear is that the economiic situation is going to work in McCains favor. Heartland America is going to look at the "familiar white man" to be a safe harbor during difficult economic times. And Palin will be shoved to the back burner.

Pay attention everyone!!!!! Don't be scammed by lies.