Economy nonsense mix-up

I have recently read blog posts where there are some uncertainties about this bailout. It really is funny how the administration thinks that renaming a bail out as a rescue plan will change the bill for what it really is. I always thought a "rescue" plan should be reserved for those who are worthy of rescue, not crooks, greedy CEOs, and definitely not people from the incompetent Bush Administration.

Today I witnessed a real live example of how a bill works and how it is passed. This would have been a wonderful example to my third graders last year of how a bill is made and passed . Anyway, congress favored the bill, and it is now going to the house. Do I hope it will pass? I don't know. Do I think it will pass? Who knows.

I am still against the bill somewhat, but now I have mixed feelings. I see to much of blaming, pointing fingers at others, and complaining that the bail out makes me unhappy. It makes me enraged, and I am skeptical about its workings. However, something needs to be done to fix this. Will the bail out fix it? Maybe it will temporarily, but if these greedy people responsible for this mess do not devise a strategy to keep this from happening again, the back lash will be much worse than protesters shouting "You broke it, you bought it" on Wall Street

What bothers me the most is how reckless these companies were, and how reckless Paulson and the administration were in putting the bill together. If you have a financial crisis, and a bill asking for several billion dollars, you better have a book's worth explaining your plan. I belieive whole heartily that these people cared nothing about the American people when they made bill. If they cared, that would have reflected in the first draft of their bill. Instead it was 2 pages and contained no oversights. What does that tell you about the original intentions of these people?

If the bill passes, let us pray it will work. I do not want to have to be put in a position where I have to introduce my kids into a country where the economy is in complete turmoil. My parents came here from India, because the life here was so much better, and there were so many opportunities for them and my brother and sister. Will the bail out bring positive change that intentionally attracted my parents to come here?

How do you feel about this?

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Winners and Losers (BREAKING NEWS!)

In breaking news, the House has rejected the bill!

The 110 page revised bill issuing a 700 billion dollar bill bail out in three installments will come out with winners, and of course, losers,

Wall Street, financial institutions, CEO’s, Bernakne and Paulson could all benefit from this massive bailout. CEO's of failing companies will be allowed to keep their jobs. If the bailout works as intended, it will enable Americans to get loans for cars, student loans, and the opportunity to open a credit card account. However the confidence that the bill work as hoped is very slim from those on Main Street.

The losers, unfortunately, include those that are facing foreclosure, loosing their homes, or whose homes are less than what they owe. This bill will do little, if anything at all to assist them. According to an article I read on Yahoo, it will also do little to halt the slide in home values. This is said to be one of the root causes of the economic slow down.

This bill will also affect tax payers that will foot the bill. The congress made it clear during their discussions of this bail out those tax payers MUST be protected. The bill will add 700 billion to the national debt. One of the tax payer protections includes that if the bailout fails, tax payers will be compensated in full.

Proponents of the bill claim that the bill could even make the tax payers money. The reality is that very few people believe that the provisions will fix the market. The main criticism is that the bill still does not address or even solve the fundamental problems of why the financial crisis came about in the first place.

The bailout, as mentioned previously, will include 3 installments. The government will be allowed to buy billion of dollars of devalued assets. 250 billion will be available immediately once the bill is passed. The next installment will be released at the authority of the president, and the last installment may be requested by the president if the congress does not act against it.

My thoughts: I hope this bill does not pass because all it does is protect Wall Street and the Bush Administration. If our Founding Fathers were to see the mess we were in, they would be ashamed of us, and all their efforts would have gone in vain. As many protesters have been shouting on Wall Street: "You broke it, you bought it!" It's time these irresponsible companies take responsibility for their actions. Let us hope this bill does NOT pass.

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Do you think it would hurt the U.S. economy if we let the financial banks fail

I was just skimming through an article on yahoo, and it looks like congress came up with a plan of action for this bailout. They call it a rescue, but I still call it a bail. In the end, it seems as if Ol' King Henry has gotten his wish after all... that is of course, with a few restrictions.

Yes, the bailout IS going to be passed. Instead of posting a long droning article on the goods, I'll list the key points and then link you to the article. Overall, I am very disappointed at this agreement.

• The plan calls for the Treasury Department to buy deeply distressed mortgage-backed securities and other bad debts held by banks and other investors. The money should help troubled lenders make new loans and keep credit lines open. The government would later try to sell the discounted loan packages at the best possible price

• At the insistence of House Republicans, some money would be devoted to a program that would encourage holders of distressed mortgage-backed securities to keep them and buy government insurance to cover defaults

• To help struggling homeowners, the plan requires the government to try renegotiating the bad mortgages it acquires with the aim of lowering borrowers' monthly payments so they can keep their homes.

• Also, the government would receive stock warrants in return for the bailout relief, giving taxpayers a chance to share in financial companies' future profits.

Here is something that caught my eye from the article which had my stomach in knots. (below)

"Money for the rescue plan would be phased in, he said. The first $350 billion would be available as soon as the president requested it. Congress could try to block later amounts if it believed the program was not working. The president could veto such a move, however, requiring extra large margins in the House and Senate to override."

So that basically means that Congress has the authority to stop payments if the rescue plan proved to be faulty. Even still, the President can stop that from happening. So even if this plan is a total disaster, the Executive branch still has the upper hand. So much for checks and balances.

Seriously, I want to know what you think. Do you think these institutions should deserve a bailout. Do you really think that if we let these banks fail, we let the economy fail. Can't we just let them fail? Why take on a risk of risky business. I'd love to hear your comments. It will help me gain some perspective on this matter.

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Wamu goes down under

Considered to be the biggest bank failure in American history, WaMu (Washington Mutual Bank) the FDIC claimed WaMu's assets and then sold most of the companies to JP Morgan, now the second largest bank in America. The fall of the bank is due to several factors. After the fall of The Leham Brothers, WaMu customers withdrew earnings approximating 16.7 billion dollars in a ten day period. The panic and uncertainty which caused this massive money withdrawal, left Wamu unable to liquidity their assets.

In the long run, WaMu's failure was due to the mismanagement and misinformed bets on the mortgage market. Due to their risky debts and tumbling mortgages, JP Morgan has dropped the loan portfolio to 31 billion. This however can change if the company decides to take advantage of the bailout IF it goes through.

For current WaMu customers, you are still able to resume regular banking. According to Shelia Bair, (FDIC chairman) what this means for customers is the combination of two banks.

For an in depth article on WaMu's fall, read article

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R.I.P. checks and balances

R.I.P. checks and balances

If you're unsure whether or not checks and balances are still alive, say your prayers. It seems as if the system which prevents branches of government from taking unprecented powers has finally been put to rest. The approximately 2-3 page bailout bill grants unlimited power to our Ol’ King Henry

In a recent posting I posted uncertainties about the 700 dollar billion bail out, but the more I read about this bill, the more uneasy and skeptical that a bailout will change anything. I am convinced that this is simply trickery and robbery of my hard earned tax dollars. It is infuriating to see the government hand over a blank check to these companies (mind you, that’s OUR money on that blank check) and then not give its tax payers squat in return. Paulsen voices sympathy towards tax payers, but that simply isn't enough, not after asking us to give up money we need so the fat cats of Wall Street can feed their wallets. Where was the bailout when over a million of us got laid off? Where was the bailout for parents who lost their health insurance and couldn't take their kids to the doctor? Where was the bailout when millions of Americans slipped from the middle class into the slums of poverty? Why on earth didn't Paulsen run to congress asking for a blank bail out check to save us? Apparently the American people aren't worth saving, but companies like Fannie Mae, Freddie Mac, and AIG deserve unwarranted money. I have read and reread through the draft, and I see nothing about compensating tax payers.

So let me get this straight Paulsen, you are asking me, an average person, sinking in this economy, to give up approx 2,000 – 3,000 of my money so that irresponsible companies can continue on with their business. I don’t think so. If its one thing I was taught, its taking responsibility for actions. If you f’d up, then YOU pay the price, not somebody else. It is insulting to sit in front of congress, ask for a huge sum of money, and then have a poor bill to back it up. If these companies fail, let them fail. As Sen. Bernie Sanders stated in his excellent speech to congress, “If companies are too big to fail, then they are too big to exist.”

What is even more frustrating for an average American is the unlimited powers this bill grants to Paulsen. View text draft of the bill. If this were a college paper, I would give it an F for poor preparation and complete lack of plan. The bill is vague, fuzzy, and has no indications how tax payers will get compensated for this Armageddon of a bill. http://www.nytimes.com/2008/09/21/business/21draftcnd.html

The bill states that courts or other agencies will NOT be allowed to review this act. "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency." So that basically means if the government wants to use that money in a fraudulent way, it can go ahead and do that. Checks and balances cannot bother to interfere with the fat cats of Washington and the actions of this faulty administration. First it was called a bailout, now they are referring it to a rescue plan. Perhaps the word bail was unsettling to Americans. However, renaming it something else is no different. A wolf in sheep's clothing is still a wolf.

By asking congress (ultimately THE PEOPLE) to have courts NOT review the bill, the administration looses their credibility to the American People. Their supposed claims are that they want to fix the economy, and the only way to do that is to pass the bill. If that is the case, why keep everything hush hush? What possibly could Paulsen do that would allow him execute this bill behind closed doors. If he wants to fix this mess, at least have the decency to do it in the open. Doing the opposite only proves you have something to hide.

Case in point, the administration is openly stealing money. As I said before, you fuk up, then you pay up. Perhaps we need to go through a quick recap in the Great Depression, because that is exactly where we will end up of our careless government is not careful.

Sen. Ron Paul said it best when he wrote “The only thing we learned from history, I am afraid, is that we don’t learn from history.”

It’s time Bush and his hazardous buddies get knocked off their high horse. Contact your state reps and say no, no, no, a million times no to this bill!

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An average American's take and undecided view on the 700 billion dollar bail.

If the Bush Administration couldn’t make any more mouth dropping, eye popping decisions, this one definitely takes the cake.

I don’t know about the rest of you, and I can’t speak for the rest of you, but I can speak for myself. Quite frankly, I am immensely angry at Paulsen’s effort to convince congress to accept the 700 billion dollar bailout. Doesn’t that cost more than the total cost of the IRAQ war? Let’s see, a 700 billion dollar bail out means that’s 3,000 dollars per taxpayer. It is in fact, the largest bailout since the Great Depression. You need more than 3 pages to validate that much of a bailout. What exactly are tax payers getting from this bailout? Money is already tight for a lot of Americans, and the last thing we is to see our hard earned money pull failing financial companies out of the hole. Why should tax payers have to take financial responsibility for the irresponsibility’s of these companies? If they want a bailout, then they need to provide an immediate incentive or something to tax payers. If we’re footing this bill, we need something in return.

I understand that the economy is in peril, and I do realize the intended purpose of the bailout is to save the falling economy, but in reality, will it really work? The Bush Administration does not display a promising track record, and its decisions have cost us unjustified tax dollars. Is this bailout any different? I, including many Americans, want to know if the bailout is really a good idea, and if it will actually help in the long run. Do these companies have any plans so that it doesn’t happen again, and if so, what will they do to convince tax payers that the bailout is worth it? The administration’s quick, 2 year plan bailout seems to lack a strategic game plan. Either that or I must be blind and am not able to understand the sheer brilliance of it. I am not that economically savvy, but something stinks about this plan. This is a matter needs to be looked over carefully, and I believe other alternatives should be considered.

I am a bit unsure of how I feel about this bailout. I feel really skeptical that this is the right thing for the administration to do. Hopefully some of you can shed some light, how do you feel about the bailout?

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