It can be a good thing. But it has been mishandled and the regulations controlling it have been slashed in the name of bigger profits, making it much more dangerous.

The scary thing about the credit market drying up is that businesses who don't have a lot of capital up-front to get started or for R&D won't be able to get loans.

Hasn't he been going around saying he's urging congress to pass this bailout bill?

I don't blame the American public for feeling anti towards the idea of bailing out banks when they are the ones who need help. Our government in the UK are doing it as well and they are probably going to put taxes up again to pay for this 'aid'. They have even nationalised some of them...

I am rather annoyed to hear that my money that 'fat-rich' taxman gets is going to prop-up UK banks.

What I want to know is, seeing how our government is 'absorbing' or buying all of these dead beat loans. What are they going to do with all of the property to which those loans are attached? I know not ALL of it is property loans, but I'm sure a lot of it is. This whole thing just seems like a bad idea. Not just the bailing out of banks, but where the money is going, where the taxable portion of this 700 billion is going to go when it returns to uncle sam, and who's going to suffer from the coming taxes we'll surely endure to help soften the blow.

this is one of the main reasons i am opposed to a bail out bill. many of the bad loans STILL have real property attached to them. its not like you invested in an intangible stock, if you bought the mortgage you effectively own the house. even if you have to sell it at a loss you can still sell it. and furthermore as far as i can tell there has been little to no oversight in the legislation that has been brought forward. a bailout should be the governments last resort, not its first choice.:rant:

Unless he changed his viewpoint during the debate I don't think so.

Well, here he's apparently been urging the markets to stay calm after the first one failed, saying that it will still get through congress, and then just today he's telling people he's going to vote for it and that its needed to prevent catastrophe.

Yeah, Obama supports passing the bailout bill.

As a socialist, it is a little satisfying to see capitalism fail so spectacularly.

Capitalism isn't "failing". Politicians in DC are ****ing up.

So the Bill passed. (at least according to news here)

what's next?

It passed the Senate. It is now going to the House to see if it passes there. I hope it still doesn't pass.

OH MY GOD! the self backslapping and slobbering over each other that our leaders take part in is making me physically ill. every time they open their mouth its just verbal diarrhea!
...anyways the bailout plan that passed the senate seems mediocre at best. i have to say i am quite frustrated with it.

My house rep had a town hall meeting over the phone last night. Pretty sure he's voting against it. He's also calling for Paulson's resignation.

on the up side, if your interested in taking a few risks, now would be a great time to scoop up some good deals in the stock market.:)

Except what we have right now isn't even close to a fully realize capitalist society. If you notice, many of the things wrong in the market are things that have government control over them (food prices, gas prices, discount rates, reserve rations). The Fed is in DIRECT control of inflation with the current monetary system. They have 100% direct control over the value of the dollar, which currently is borderline worthless, ****ing many things up in our economy. The ENTIRE credit market is a result of the Fed, even

I love how you all hate this bill when I'm pretty sure none of you even understand the problem with your "this was the bank's fault, screw them!!" mentality. You realise that this doesn't just affect the banks, it affects you as well?

Except that with the current plan, the bailout is essentially a tax on American people for the bank's ****ing up. Why would we want to support this? Inflation is a tax, and an influx of basically the cost of a ****ing war in a day will only make inflation worse. Not to mention this would only ****ing ENCOURAGE banks to keep engaging in the same risky behavior.

I like capitalism as much as the next guy, but a full laissez faire economy is a great way to **** over the people. Pure capitalism may have made sense in the 18th century, but not today with many industries have such incredibly high barriers to entry.

I love how we trust the institution that created these problems to then solve them when they already have a history of making problems worse when they get involved. I'm stuck between a rock and hard place on this issue. I'm by no means a laissez-faire capitalist, but I sure as hell don't trust government not to **** it up.

I'm also to the point where I just don't care about the latest apocalyptic fad anymore.

Government intervention is required to prevent deadweight/welfare losses in some markets. A good example of this is health care. Like Emon said in so few words, "a full laissez faire economy is a great way to **** over the people".

And home lending, amirite?

Actually, it's working spectacularly. Capitalism is just natural selection applied to the economy. People did stupid things, and with the aid of government stupidity have managed to screw themselves over. If they are allowed to suffer for their actions, the economy will tank, people that are not incompetent will take over, and things will start working again.

Capitalism just assumes that natural selection will work better than governmental selection. On something as large as the US economy, this is probably true for most scenarios.



Because if we don't, we get a massive recession and sweeping foreclosures that hurts everyone. Its not as easy as watching some CEOs portfolios go to hell.

Printing more paper and pumping it into circulation to further dilute our already watered down currency is just brilliant.

[Not worth my time for anything longer]

All I'm saying is that there is no way out of this. The bailout as it currently stands will do absolutely nothing. It'll cause more inflation, make our dollar worthless, keep banks that deserve to fail afloat with basically a blank check for their retarded behavior, and will in the hurt us the most because of the inflation tax. Banks make retarded behavior, but people pay for it through their purchasing power going down? Just doesn't seem right to me. It's not like people will suddenly be confident in these banks that were on the verge of failure once they are given a free pass to do it agian.

I agree that the way to go is not to take the bailout, even though that will give is pretty good recession short term.

Between passing laws that require banks to lend to high-risk people and having a government institution that inflates the money so the banks will have more to lend to high-risk people, yeah, you're right.

Uh, no? The only thing the government did was say the banks can't take geographical location into account when giving loans. The government is certainly not forcing banks to give risky loans.



The Fed is not a government institution.

Are you saying it was coincedence that the only geographical locations the banks were loaning to before the CRA were the geographical locations where the wealthy lived? Are you saying that when Clinton explicitly expanded the CRA to poor urban neighborhoods that was a decision based on geography, not economic status?


You're right. I confused having the power of the government with being a government institution(I'm not being sarcastic, and I know that probably doesn't make sense to some people).

well... took the words right out of my mouth.

Hahaha, if this is capitalism working spectacularly, then you've certainly bolstered my socialism.

Also, right-wing capitalism is nothing at all like natural selection. A lot of American economists in the 80s interpreted Dawkins' Selfish Gene to have parallels with 'dog-eat-dog' free-market capitalism, and to justify their economic model as somehow 'natural'. It really isn't, and Dawkins is quite angry about this, altruism is a significant part of natural selection, so I'd stop using that metaphor.

In some ideal meritocracy, the banker's that take the risks should indeed suffer the consequences. Capitalism is not such a meritocracy, because it is so reliant upon the banks and these bankers for its financial stability. If the banks go under, companies cannot take out business loans, the whole economy will freeze, and go into a terrible recession. These bailout plans certainly seem distasteful to pretty much everyone, but without it you'll be suffering even more in 6 months' time.

Well....we're boned.

Except that you could jack up interest rates, get those banks that deserve to fail to go under, and then get our dollar back up because of the high level of foreign investment from countries abroad. The ONLY way to get this economy back is to get the value of the dollar back and get some confidence in the dollar again, and the only way to do that is with higher interest rates and foreign investment. And this can easily be a short term solution with monetary policy. It has been shown that increased foreign capital increases short-run output, and will also get the dollar back. Once confidence has return, we can slowly lower interest rates again and business with their now more valuable assets can start investing again. And it's not like every bank suddenly will go under. There are still many many banks in the US....it's not like without the bailout America will be bank-less

The problem is with investment banks.

Of which there are thousands upon thousands in the world. And eventually investment banks will return. Not like they existed at the outset of the creation of the United States, no?

First, capitalism is NOT right wing. Free market economics have been around far longer than the term right wing has existed, and is not really owned or wholly adhered to by the GOP. (Especially these days)

Also, the economic model has to be "natural" by default. How do you think we got here today? Economies have existed long before anyone studied economics, or regulated it. Our efforts to model the economy are crude and complex, and we aren't even close to having a good hold on it.

As long as we have a government that provides and enforces the rules, the economy will go up in the long run. It has and it will. It will be set back by stupidity, but unlike with socialism, stupidity fails pretty quickly. This whole mess started out when the government started putting pressure on banks to extend credit to people who normally would have been considered unsafe to lend money to.

And Dawkins? Seriously? What does he know about economics? Also, altruism's function in natural selection depends heavily on the societal nature and dependency of the creature in question. Societies are sort of organisms in the same way single cells make larger organisms, so that will often effect the natural selection tenancies of the individual organism. Bees are a good example of this.

Honestly, I hate government, but anyone who wants a completely laissez-faire or "evolutionary" economy is out of their mind. The Industrial Revolution, which is laissez-faire or damn close, was not a good time. An arguably necessary time, but not a place we should digress to.

Regress.