More on the bailout
September 26th, 2008What happens with a $700 bailout:
1) Other countries become weary of lending the US money. It has become apparent that we cannot do anything right. Already there have been rumors of China putting a hold on lending us money.
2) You have inflation, even worse than it already is. We have 5.4% inflation right now, which is downright horrible. Are you getting a 5.4% return on your savings? In your CDs? In your Money Markets? In stocks? $700 billion is a lot of money, folks.
3) The CEOs will get their golden parachutes. How would you feel about paying $7000 in tax per family then watching the CEOs of each of these companies walk away with $20+ million while they ran their company into the ground? Would that bother you at all?
4) Higher taxes. Whether you like it or not, they will; have to raise taxes.
Be careful what you wish for, folks. It’s George W Bush behind these scare tactics. It’s always a boogie man for that guy. If you don’t do this…the boogie man will get you. If we don’t bailout these companies, the economy will collapse. Or so he says. Has GWB been right about anything so far? Then why will he be right about this? Don’t fall for it.
Think who is behind the sky is falling crap. These are people who will profit the most from your $700 billion. Make sure you keep your money your money.
The Dow will drop 2-3k if we don’t bailout these companies. Yes, that sucks. Yes, I have tens of thousands invested in the Dow right now and I will lose a lot of money on paper. But I will ride it out.
It’s better than the alternative, by far. You want higher taxes? You want to help buy these CEOs another house in the Hamptons? You want higher inflation?
When the Dow bottoms out, buy more and hold it long term. Keep gold, silver, ammo, food, land, and cash. If you don’t have all that to begin with, then I must be speaking to a wall. I thought I’ve been saying this since ‘05 when I started blogging.
The economy will recover. It needs to hit the bottom. We are still leading the world in inventions. We still are leading the world in medical breakthroughs. We still are leading the world in stupid little gadgets that everyone else thinks they need. Don’t worry. The economy will still be there when this is over.
Think about it. Do the math, folks. The money you lose in the stock market will pale compare to the alternative.
Just say no to the bailout. Go back to my previous post and click that link and contact your Reps.
And take 5 minutes to watch this video.
Not to sound kooky… but why are they saying “Mr. Speaker?” Where’s Pelosi?
She makes a lot of sense. I guess financial scare tactics are more hard hitting than terrorist scare tactics because the impact is tangible and real to everyone. I have to say I agree - if there is going to be a bailout, then part of it should be funded by equity and assets of the CEOs of the banks involved.
Laura - Instead of a bailout, how about rewarding everyone in this country that was fiscally responsible, paid their rent/mortgage through this entire crisis, and paid their taxes on time?
Why must the people who do everything right be continually punished because of other people being irresponsible? I’m tired of bailing out the rich. Let’s call a spade a spade here. We are bailing out the rich.
I don’t know. Maybe Pelosi’s on vacation and the current guy is a sub?
Keep in mind, this Congresswoman is right on calling them scare tactics. We will survive through this. The bailout is not life and death, and it will not lead to a Depression if it doesn’t happen.
Laura, every time I’ve watched C-Span in the last month, Pelosi hasn’t been there. She needs to be FIRED!
Many of the CEOs, who are responsible for this fiasco, have resigned…with a fat severance package! WTF?!
I’ve been saying this for a long time: our country has become too dependent on the fantasy world of the stock market. It’s time we get back to solid business practices!
I can’t stand that bitch. Pelosi, I mean. Big mouth, stupid woman.
I didn’t think CSPAN could be so exciting. I was amazed by a politician calling out corruption and fighting so vehemently for the American people. We need more politicians like that, ones with spines and souls.
Zombie: I agree in principal with what you’re saying, but I think we have let the system go too far off course for too long. We have a banking system that, if failed, will collapse huge chunks of our economy and make it impossible for normal Americans to get any form of credit. I don’t think the money should be used to bail out the CEOs, and I think they should be held accountable for “damages” and pay back their severances. But without shoring up these banks (or having the feds sieze them), I don’t see an alternative.
Great video - I laughed uproariously when she said “People who earn money have a right to keep it!” Imagine a DEMOCRAT saying that.
Gotta say that over the past many years Republicanarians and Demogods don’t show a lot of differentiation!
Cheers
Ya know.. watching my investment shrivel up today like a raisin, I keep reminding myself that I should have known better.. watching the explosion of the housing industry tied with a rising nation credit index and loans going to people that weren’t qualified to obtain said loans.. that we were headed for a meltdown of this portion.. living on paper only lasts so long.
Even in my loss today.. there was a sort of weird sense of relief that the measure was nixed and that Wall Street was in all out panic. We have to go through the pain to recover from years of bad practice.. it is no different than any other healing process, you have to rid yourself of the problem first.
In this case, the problem was over extending credit to shaky investment policies and betting on the high risk. We have to reform the policies and allow some of this bad debt to crumble away. Throwing an large chunk of more paper and high interest loans at the problem isn’t the solution.
Cutting the fat, reforming the way we do business and building back up from the bottom up is.. not trying more of the trickle down that absorbs most of the more well before it ever hits the root of the issue.
Damn it was a bittersweet day in a way.. but the pain hasn’t even hit yet.
Tshsmom - It’s time we get back to solid business practices!
Exactly.
Leslie - I hate her policies. I’m sure I wouldn’t like her as a person either.
Skeletor - She should be running on the Dem ticket instead of Obama, someone without a spine.
Laura - It’s a bandaid over an amputation. We need to hit the bottom and let capitalism take care of itself.
Wallflower - That’s why I vote 3rd party usually.
Pack - I didn’t say it wouldn’t be painful. I lost thousands today on paper. I’ll probably lose thousands more tomorrow. But the trick is to find the bottom and go all in.
The alternative - thousands in taxes + interest on the tax + nobody wanting to lend to Americans any more + paying for more CEO’s houses in the Hamptons, guys who should probably be in jail.
Throwing an large chunk of more paper and high interest loans at the problem isn’t the solution.
Cutting the fat, reforming the way we do business and building back up from the bottom up is.
Perfect. That’s exactly it. Who else do we bail out next? We have to draw a line and say enough is enough.
Thshmom: Honestly, about Pelosi, I can’t say I know whether that’s common practice for the speaker to be out so much. I never would have noticed before if it weren’t for the obvious gender pronoun issue.
Zombie: I think it’s easy for us to sit here and discuss what we think about the problem, but neither one of us is an economist. I am not even going to pretend that I have a grasp on what the best solution to the problem is. We could let everything crash and burn, but I can’t help but think of all the people who would be hurt by that. I don’t think this is exactly the right time for the social Darwinist approach to fiscal responsibility.
Laura - Will all due respect, none of the economists have the right answers either. Nobody does. Economics is far from an exact science.
Did you watch the video at all? She makes some excellent points.
I did watch it, and yes, she makes great points. I agree with her in principle, and yes, she did make me think twice about the source of information and scare tactics. I certainly don’t think this is an “emergency” that must be solved right now or we’ll all die.
And I know economics is far from an exact science - but I’m not even in a place to make educated guesses. I don’t know the first thing about markets or economies besides money= good.
I also don’t think that simply letting the bottom drop out will be the right thing either. If we still had a system where every industry and investment firm weren’t so intertwined, then yes, letting them fail would weed out the weaklings so to speak. However, letting these huge investment banks fail means there will be no credit available to small businesses (this is already happening), and to individuals who do not have cash on hand to buy everything they need. The people who live on their incomes are the people who will suffer most.
The problem though is this act doesn’t take care of the people who need it the most. It has no mention of them, just bailing out the uber corporations.