Bailout Deal Reached

[cw1865]

Originally Posted by gettysburgerrn

As long as the housing market continued to ballon, everyone was happy...then when the bottom fell out of that banks started loosing their shirts and the whole house of cards collapsed....so not only do I have to work 2 jobs to pay my mortgage, but also to pay for bad judgement by both irresopnsible borrowers and greedy lenders (who of course will land on THEIR feet)....I guess Michael Douglas was correct in Wall Street "Greed is good"

ken

What I find really amazing about it; assuming that the underlying 'cause' (they will be debating the cause for years and ad nauseum of course) are the mortgages that are in default; is that the bank structures the transaction in every way to protect the bank:
1. With respect to 'sub-prime' the bank assessed higher interest rates which are supposed to compensate the bank for the greater risk they were taking (guess they underestimated this) - ie. over a statistically large population the higher interest rate is supposed to compensate the bank for the greater rate of borrowers who are in default.
2. With respect to loans taken with less than 20% down, the banks will often make the borrower pay 'PMI' or 'PMSI" which is essentially INSURANCE that the borrower pays to further secure the lender in the event of default. (Where are the insurance companies?)
3. The loan itself is actually secured by at least SOME form of property.

Well, this isn't the type of bill that you support, I suppose that you're either against it or you're 'begrudgingly' for it.

At the very least 'heads need to roll' and they aren't going to do it either. WaMu's CEO is apparently walking away with millions. I'd like to see some sort of accountability injected into the system. Perhaps something to the extent that all CEOs for a certain period of time prior to a failure are to be held 'strictly liable' for any bank failure? (even if they're not to blame). Pledging their personal assets to support the institution? (ie. if it fails they're going to jail and coming out penniless)

Maybe its not fair, but neither is the bailout....

[cw1865]

9/11 -

http://www.nypost.com/seven/02052007...m_topousis.htm

$3 billion

http://www.usatoday.com/news/sept11/...1/pentagon.htm

Pentagon repairs - $700 million

Four Airliners

Assuming Boeing 737 Next Generation - $50-$85 million per unit = $340 million

Now of course the absolutely tactless part is placing a value of lives. I have read that the EPA places an internal value of a life at $8 million. In other words, if the cost of regulation can save lives at an $8 million per life saved rate, they consider it efficient, if not, then they consider the regulation burdensome. Nevertheless, we'll say 3,000 * 8 million = $24 billion

TOTAL DIRECT COST OF 9/11 = $28 billion

Now of course there are other factors and major indirect costs, but in response to this we sent an army half way around the world around the world.....Wall Street makes Al-Qaida look like mostquitos.

I'm not trying to belittle 9/11 - just really ticked off about this bailout thing...in case you haven't noticed....

[M E Wolf]

Dear CW1865,

I heard that the bill was not passed. Democrats and Republicans did exactly like how it was written up and presented.

All I can dare say without becoming 'uncivilized.' But, I am very angry about lenders who have loaned to those who had no business being approved. What the heck are these companies doing loaning money to illegal unemployed folks? What the heck are these companies doing giving loans out like candy, seeing they have no way of making ends meet, let alone pay off a loan/morgage. What the heck are these companies doing passing out credit card applications and know that they can't afford to pay it all off. These little 'traps' of theirs should be sprung right back on 'em and their feet and more held to the fire. Regardless, it is the guy who pays their bills, morgages, loans, pays higher percentages, saves, invests in secure investments--who pay.

I also haven't seen my check reflect the cost of living increase. [drums fingers on table]--so who is using what is due me--at what kind of profit?
If its happening to me--gotta be happening to others. It is plain 'theft to me.'

[Gets of the Tide soapox]
Respectfully submitted 'rant,'
M. E. Wolf

[Baggage Handler #2]

Baggage Handler #2's Rules of Economix #25A:

Every 65-80 years there is a redistribution of wealth in North America.

... and #25B
It takes about three generations for those newly monied by the last redistribution to become arrogant and stupid enough to blow it all.

[gary]

I hear tell that the bailout was scuttled by the House today and that the Market dropped 700 points in response. I'm inclined to agree with Baggage Handler about crashes and this one will be world-wide. Methinks Asia will be on the top for the next 30-40 years.

[gettysburgerrn]

I agree with Baggage Handler too (though I hope some of that wealth gets "redistributed:" to me ). That is kind of why I am not enthusiastic about the bailout - let the market normalize and correct itself....that and the arrogance and greed of the financiers, bad judgement of homebuyers . To quote a book on an unrelated toopic.-- there is plenty of blame to go around..

Then again I am no economist....
'
ken