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  • apostate_001 apostate_001 Sep 20, 2008 2:25 AM Flag

    The bailout ... what's the rush?

    Should the government implement a financial bailout, unprecedented in its size, to protect the economy?

    Our choice is being framed as either a costly bailout or suffering some very ugly economic consequences. I don't know which is preferable because the public has been provided with little insight about either choice. Does anyone really know the precise cost of the planned bailout? Of course not. Will the bailout--whatever its final cost--actually succeed such that our nation's financial institutions are healthy again and the economy is rosy? Highly doubtful. Most likely, this bailout will prolong our deteriorating economic situation--rather than cure it. On the other hand, to allow yet unspecified things to collapse as they naturally would without any further intervention could mean a very rude surprise for our entire nation (and perhaps the Western World). Nevertheless--perhaps--the wiser choice for the nation (excluding than the financial sector of Wall Street) is suffering the consequences now, and getting on with a fresh start.

    As of today, September 19, 2008, Bernanke and Paulson seem to have sold the concept of 'avoidable doom' to a meeting of a handful of Capitol Hill leaders, the highest echelon of our legislative branch. The group was informed of the proportions of the utter financial disaster that will result if newly proposed legislation, a bailout of the financial sector our economy, doesn't occur immediately. Senator Chris Dodd, head of the Senate Banking Committee, who attended that meeting said that "the oxygen went out of the room" when Bernanke and Paulson explained that a crisis supposedly exists and how dire are its probable consequences. When pressed, Dodd resisted going into detail about the existing crisis and its consequences, presumably not wanting to incite panic. Actually I have not heard anyone associated with the government be specific about the reasons for the immediacy. In fact, Benanke and Paulson may have oversold the urgency. After all, it’s well known that the real estate markets, credit markets, and other aspects of the financial system have been known to be in a meltdown for many months already. What exactly is the rush? Explain it to the public. Before another dollar is appropriated (additional to hundreds of billions of fiat money already pumped into the financial sector), at a minimum, the Republican Administration should make a full acknowledgement as to the extent of the crisis that has occurred on their watch. In other words, any interested citizen in the USA entitled to a confession from their government as to how bad things stand and receive a clear explanation as to why a further bailout is appropriate. On its surface, the bailout proposes to relieve all lenders holding bad mortgage paper of any adverse risk. The counterparty to that bad mortgage paper--the foolish borrower--does not have his debt forgiven.

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    • It boils down to the Chinese and the remaining foreigners that buy our national debt that are getting pissed that the dollar is threatened and their debt investments are severly threatened. So to fund our ever incresing deficits, our government capitulated to avoid the Chinese threats of either stoping funding of our national debt or they could even flood the market with our debt, thus ruining our economy.

      The Chinese have us by the financial balls and the government knows it. Pretty picture isn't it?

      And the government just made our national debt jump drastically. So we have a death spiral situation. We just handed the Chinese even more power over us.

    • A bailout this big, whether a good thing or a bad thing, shouldn’t be done in such a rushed fashion. I'm certain when I say drafting such a massive legislative handout over one Saturday is rushing. If we are truly a democracy, before spewing hundreds of billons of dollars or perhaps upward of a trillion dollars out the Treasury fountain for a 'bailout', shouldn’t there be some public debate about what, how, to whom, and how much? And what benefit can be expected? Isn't there at least time to give careful, thoughtful consideration about the next steps? A trillion dollar legislative plan to resolve an extraordinarily complicated problem shouldn’t be hurriedly hammered out over a weekend by a few persons in one room. Perhaps--or perhaps not--the wiser choice for the nation (other than the financial sector of Wall Street) is suffering the consequences now, and getting on with a fresh start. Perhaps Congress should extend the legislative process to at least have some floor discussion among the people's representative. Can the ‘emergency’ really be that dire and urgent that its solution has to be legislated immediately? If so, why couldn’t our leaders have had more foresight and started planning this legislation much sooner? Personally, I think we should at least muddle along until the election and let the next administration fashion the solution. During a presidential campaign is an excellent time for the public to have a voice.

      If you agree, pass this item or your personal viewpoint along to your representatives in Washington.

      • 1 Reply to apostate_001
      • I say congrats on your posts concerning the "bailout" You are probably one of the very few that really have made a good and valid point for some time on this board. I don't post here but do read as I do some day trading on COF. Your message should be sent to Washington, rolled up very neatly and then shoved up George W's ass. He dam well knew that he would have lost the last election in 2004 if they had put the halt to this subprime lending mess as it was the only thing pushing our economy forward and I mean the only thing.
        All those fat cat banking pigs and George W new what would happen to the economy had they acted several years ago to put a stop to this type lending. Our economy would have gone to shit way before the 2004 elections and this would have cost the GOP the power and occupancy of the White House. Don't let anyone put the blame for this mess anywhere else except at the front door of the White House. Now all you GOP, George W. lovin people can tell me that I am wrong but that won't be the truth and you all know it. Long or short, it doesn't matter because this bailout will cure nothing in the financial markets and then you are out of chips. Can't even set at the round table unless you have chips to play with and our crooked Gov't just played their last chips. Take that shit to the bank.

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