Bailout bill failing in House

[SP33Demon]

Originally posted by: Mill

Originally posted by: SP33Demon

Originally posted by: Fern
I don't see how going through bankruptcy will axiomatically require more conservative lending policies? (or even require FDIC payouts etc)

Bankruptcy will likely result result in shareholders losing their investment, changes in management and extinguishment of some debt. The bank would re-emerge stronger and under new ownership (probably owned by creditors).

I think the use of bankruptcy as a tool here should be more fully explored. I'm not convinced as many here seem to be that just throwing huge piles of taxpayer money at the problem to *make it go away* is the right chioce. I understand how Congress might be concerned about the outcry from those investors in these failed institutions; but not all investments are profitable and the bankruptcy avenue is here for a purpose. I.e., tough sh!t if you're heavily invested in the finance/banking sector and take a hit. The portfolio theory exists for a reason.

I believe the negative consequences are being over-hyped and that the *real* point is to save peoples' investments/401(k) plans and pay for it through the backdoor with tax increases (larger gov debt will eventually lead to higher taxes - good freakin luck cutting social/entitlement programs etc). I.e., a person like myself with little stock investments will be underwriting other peoples' investments.

I'm open to *draining the swamp* of these finacial problems and taking our medicine for a time. I realize this will have recessionary effects, but do not believe it will be as bad as claimed by many.

Finance is highly international, I've yet to hear anybody explain WHERE our $700B is really gonna go? Have foreigners purchased US backed mortgage securities? Is our money going to anybody anyplace other than the USA? If so, I say "NO". If they can't determine with 100% certainty that our $700Bwon't *leak* to foreigners I say "NO". Have they even considered this in their panic?

I see a lot people here opining how this needs to be passed etc, yet I see very little at this point about what exactly is in this new compromise legislation. I heard it was over 100 pages, I doubt we'll get details and/or any understanding of what it contains for a while. I don't anybody should be voting "YEA" until they are 100% certain of what they are voting for.

Fern

That's actually one of the best ideas I've heard all day: use bankruptcy as a monetary tool and just wipe most of the debt away. That's what we did when we lent money to African countries who we knew would never pay it back. Obviously that would be in layman's terms and it's much more complicated than that, but would banks be so tepid to play nice if all of their toxic debt from the subprime market vanished overnight? Of course, liquidity would still be an issue but the Fed can pump billions (like they did today) into existing programs if it became a problem. And I doubt if all of the toxic debt was just "forgiven", then 700 billion would not be necessary. Thoughts?

Worked great for Argentina!!!

http://en.wikipedia.org/wiki/A...mic_crisis_(1999-2002)

They still haven't recovered and it is 7 years later.

From your link, ORLY?:

While unemployment has been considerably reduced (it's been hovering around 8.5% since 2006), Argentina has so far failed to reach an equitable distribution of income (the wealthiest 10% of the population receives 31 times more income than the poorest 10%). This disparity, nevertheless, compares quite favorably to levels seen in most of Latin America, Asia and Africa.

 

[smack Down]

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

Not implying all debt in this country, only ones that were caught up in the subprime mess. Homeowners have a record for five years, lenders get forced with new management and strict auditing for a decade.

I didn't say all debt, but $700 billion worth of bankruptcies would be catastrophic. All mortgage related debt would be somewhere around $10 trillion. The problem is confidence with lenders. Screwing them out of $700 billion isn't going to restore confidence, it's going to be the final nail in the coffin.

I doubt it, mainly because big lenders definitely knew what they were getting into (i.e. ones that would still remain solvent). Decapitating management from the culprits + strict auditing on whatever baby company that survives would definitely restore confidence IMO. With the Fed pumping additional liquidity into the market (but not 700 billion), everyone will get a clean start.

The problem isn't with lenders being wary of individual customers or the culprits. It's lenders being wary of lending any money AT ALL. Replacing management at some large firms won't do the first thing.

What I'm seeing in the posts here from Fern and others is people replacing the opinion of the vast majority of economists the world over with a 'gut' feeling about how you think things should be. I find that absurd.

Well if the majority of economists where not employed pimping stocks maybe someone would give a fly fuck what they thought

 

[frostedflakes]

What about suspending mark-to-market accounting? I'm no expert, but it sounds like this could really help the market correct itself by not letting the price of bad mortgage-backed securities drag down the price of good ones (and my understanding is that *most* mortgages are good, only a very small percentage are the subprimes that people have had to default on). Why aren't we trying stuff like this before handing the feds hundreds of billions?

 

[fskimospy]

Originally posted by: smack Down

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

Not implying all debt in this country, only ones that were caught up in the subprime mess. Homeowners have a record for five years, lenders get forced with new management and strict auditing for a decade.

I didn't say all debt, but $700 billion worth of bankruptcies would be catastrophic. All mortgage related debt would be somewhere around $10 trillion. The problem is confidence with lenders. Screwing them out of $700 billion isn't going to restore confidence, it's going to be the final nail in the coffin.

I doubt it, mainly because big lenders definitely knew what they were getting into (i.e. ones that would still remain solvent). Decapitating management from the culprits + strict auditing on whatever baby company that survives would definitely restore confidence IMO. With the Fed pumping additional liquidity into the market (but not 700 billion), everyone will get a clean start.

The problem isn't with lenders being wary of individual customers or the culprits. It's lenders being wary of lending any money AT ALL. Replacing management at some large firms won't do the first thing.

What I'm seeing in the posts here from Fern and others is people replacing the opinion of the vast majority of economists the world over with a 'gut' feeling about how you think things should be. I find that absurd.

Well if the majority of economists where not employed pimping stocks maybe someone would give a fly fuck what they thought

Save your stupid anti-elitism.

 

[Mill]

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: IHateMyJob2004
Hilarious. You must think you know moire than Warren Buffet .... who thinks a failing of this bill will bring about hte great depression. I can give you a link to his statements if you'd like, just PM me.

No need, I read the news. Yet I find it hilarious if you don't think Buffet has a huge stake in how this will play out. His most recent baby. If I were you, I'd take his comments with a grain of salt.

Do you honestly think Buffet cares that much about his personal stake in things anymore? I'm sure the guy that recently gave away the majority of his fortune is just so greedy as to try and manipulate the market. Give me a break.

Buffet owns 38% of Berkshire. While he may not care about money, you have to be stupid if you think he wants his company to get fcked (as well as his friends who own the other 62%).

Berkshire actually went up today, and Buffett has been betting against the US and the dollar for a long time now (he has made a ton doing it). Add in the fact that he is givingit all away, I cannot fathom how you can indict him for being greedy and consumed by personal self-interest. Speaking of "friends" that own part of Berkshire, try Bill and Melinda Gates' foundation that is GIVING ALL THEIR MONEY away as well. They have invested the bulk of it in B shares of Berkshire.

Warren Buffett is only for the bailout because he doesn't want to see breadlines and people without jobs -- not because he is going to profit. Many of his businesses are very recession proof, and if anything he'd benefit from people pouring their money into his shares to stay in the market yet limit their losses.

 

[JS80]

Originally posted by: RichardE

Would it be the only bailout? How much would the US dollar devalue? What cascading effects would that have on business and employment? You are a fool if you think this is a silver bullet. I still think it should have gone through, but not for reasons that will occur anyway.

No, it will not be the only bailout. It's only a matter of time LBO paper gets hit and commercial paper start to go to shit. Did I say it will be a silver bullet? By doing this you slow the economic contraction, you don't you see overnight collapses. It will prevent unemployment from going to 30%, but it will not prevent it from going to 8%.

 

[BoberFett]

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

 

[Mill]

Originally posted by: SP33Demon

Originally posted by: Mill

Originally posted by: SP33Demon

Originally posted by: Fern
I don't see how going through bankruptcy will axiomatically require more conservative lending policies? (or even require FDIC payouts etc)

Bankruptcy will likely result result in shareholders losing their investment, changes in management and extinguishment of some debt. The bank would re-emerge stronger and under new ownership (probably owned by creditors).

I think the use of bankruptcy as a tool here should be more fully explored. I'm not convinced as many here seem to be that just throwing huge piles of taxpayer money at the problem to *make it go away* is the right chioce. I understand how Congress might be concerned about the outcry from those investors in these failed institutions; but not all investments are profitable and the bankruptcy avenue is here for a purpose. I.e., tough sh!t if you're heavily invested in the finance/banking sector and take a hit. The portfolio theory exists for a reason.

I believe the negative consequences are being over-hyped and that the *real* point is to save peoples' investments/401(k) plans and pay for it through the backdoor with tax increases (larger gov debt will eventually lead to higher taxes - good freakin luck cutting social/entitlement programs etc). I.e., a person like myself with little stock investments will be underwriting other peoples' investments.

I'm open to *draining the swamp* of these finacial problems and taking our medicine for a time. I realize this will have recessionary effects, but do not believe it will be as bad as claimed by many.

Finance is highly international, I've yet to hear anybody explain WHERE our $700B is really gonna go? Have foreigners purchased US backed mortgage securities? Is our money going to anybody anyplace other than the USA? If so, I say "NO". If they can't determine with 100% certainty that our $700Bwon't *leak* to foreigners I say "NO". Have they even considered this in their panic?

I see a lot people here opining how this needs to be passed etc, yet I see very little at this point about what exactly is in this new compromise legislation. I heard it was over 100 pages, I doubt we'll get details and/or any understanding of what it contains for a while. I don't anybody should be voting "YEA" until they are 100% certain of what they are voting for.

Fern

That's actually one of the best ideas I've heard all day: use bankruptcy as a monetary tool and just wipe most of the debt away. That's what we did when we lent money to African countries who we knew would never pay it back. Obviously that would be in layman's terms and it's much more complicated than that, but would banks be so tepid to play nice if all of their toxic debt from the subprime market vanished overnight? Of course, liquidity would still be an issue but the Fed can pump billions (like they did today) into existing programs if it became a problem. And I doubt if all of the toxic debt was just "forgiven", then 700 billion would not be necessary. Thoughts?

Worked great for Argentina!!!

http://en.wikipedia.org/wiki/A...mic_crisis_(1999-2002)

They still haven't recovered and it is 7 years later.

From your link, ORLY?:

While unemployment has been considerably reduced (it's been hovering around 8.5% since 2006), Argentina has so far failed to reach an equitable distribution of income (the wealthiest 10% of the population receives 31 times more income than the poorest 10%). This disparity, nevertheless, compares quite favorably to levels seen in most of Latin America, Asia and Africa.

Yes, ORLY. I spent the entire summer and there and no one trusts banks or the government, and the entire economy is being held up with thin shreds of high commodity prices (not anymore!!!) . Constant protests against the Government, 20% inflation, etc. Argentina was one of the richest countries in the world not that long ago, and due to chronic mismanagement they are in a crappy position.

 

[fskimospy]

Originally posted by: Fern

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

The big buga-boo is the unknow extent of crappy assets.

Banks will do retail lending to people. They won't lend to other banks, or so we hear, because they do not know to what extent the other the banks might be in trouble because of these securities. Quite likely why they won't lend to some companies either (large corps use investments like these securities in their cash management programs - many are thought to hold considerable amounts of this stuff in their porfolios).

So, the problem at the basic level is the lack of knowledge; how does throwing around $700B make the picture any clearer? It doesn't.

However, when you run these companies through bankruptcy you can fix that. They'll come out bankruptcy with this garbage stripped out; that'll make them certifiably good lending candidates.

Look, banks need to lend money; that's how they make money. Every incentive in the world already exist to encourage them to lend, we just need to clean up the uncertainty WRT to the securities.

Fern

$700 billion worth of debt being erased is a pretty colossal disincentive to lend. From everything I've read, we're talking a full scale collapse of the financial system if that happens.

I'll take my economic cues from economists instead of accountants, thanks.

 

[SP33Demon]

Originally posted by: IHateMyJob2004

Originally posted by: SP33Demon

Originally posted by: IHateMyJob2004
Hilarious. You must think you know moire than Warren Buffet .... who thinks a failing of this bill will bring about hte great depression. I can give you a link to his statements if you'd like, just PM me.

No need, I read the news. Yet I find it hilarious if you don't think Buffet has a huge stake in how this will play out. His most recent baby. If I were you, I'd take his comments with a grain of salt.

Oh, he totally expects passage. He also said that if it doesn't pass for some reason that he will start selling US positions.

And if you are referring to Goldman Sacks, you also realize that the deal is not a done deal yet. There is no paper work done yet.

Oh, his recent baby is a Chinese battery manufacturer that plans to start selling electric cars in 2010. You knew that though.

Yep, I knew about the Chinese investments but no specifics. BTW Buffet already gave $5 billion so it's pretty much official.

?We?ve done business with them for years, with Goldman,? he said, ?and the price was right, the terms were right, the people were right. I decided to write a check.?

 

[Dari]

Originally posted by: BoberFett

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

It isn't all worthless. But some of it is and banks need money so they are trying to sell them but nobody wants to buy them, driving down the prices.

 

[Baked]

I just wanna say, "Haaaaaaha!"

 

[BoberFett]

Originally posted by: eskimospy

Originally posted by: smack Down

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

Not implying all debt in this country, only ones that were caught up in the subprime mess. Homeowners have a record for five years, lenders get forced with new management and strict auditing for a decade.

I didn't say all debt, but $700 billion worth of bankruptcies would be catastrophic. All mortgage related debt would be somewhere around $10 trillion. The problem is confidence with lenders. Screwing them out of $700 billion isn't going to restore confidence, it's going to be the final nail in the coffin.

I doubt it, mainly because big lenders definitely knew what they were getting into (i.e. ones that would still remain solvent). Decapitating management from the culprits + strict auditing on whatever baby company that survives would definitely restore confidence IMO. With the Fed pumping additional liquidity into the market (but not 700 billion), everyone will get a clean start.

The problem isn't with lenders being wary of individual customers or the culprits. It's lenders being wary of lending any money AT ALL. Replacing management at some large firms won't do the first thing.

What I'm seeing in the posts here from Fern and others is people replacing the opinion of the vast majority of economists the world over with a 'gut' feeling about how you think things should be. I find that absurd.

Well if the majority of economists where not employed pimping stocks maybe someone would give a fly fuck what they thought

Save your stupid anti-elitism.

You consider people that brought us to this point to be elite? In that case, you can be as easily dismissed as they are.

 

[fskimospy]

Originally posted by: BoberFett

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

It's not worthless. The problem is that people just don't know what it's worth. The government will likely be able to sell these securities for as much as they paid for them if not more. (look at Chrysler) We're not giving away $700 billion, in all likelihood we'll get much if not all of it back... the aversion of economic catastrophe is just a bonus!

 

[SP33Demon]

Originally posted by: Mill

Originally posted by: SP33Demon

Originally posted by: Mill

Originally posted by: SP33Demon

Originally posted by: Fern
I don't see how going through bankruptcy will axiomatically require more conservative lending policies? (or even require FDIC payouts etc)

Bankruptcy will likely result result in shareholders losing their investment, changes in management and extinguishment of some debt. The bank would re-emerge stronger and under new ownership (probably owned by creditors).

I think the use of bankruptcy as a tool here should be more fully explored. I'm not convinced as many here seem to be that just throwing huge piles of taxpayer money at the problem to *make it go away* is the right chioce. I understand how Congress might be concerned about the outcry from those investors in these failed institutions; but not all investments are profitable and the bankruptcy avenue is here for a purpose. I.e., tough sh!t if you're heavily invested in the finance/banking sector and take a hit. The portfolio theory exists for a reason.

I believe the negative consequences are being over-hyped and that the *real* point is to save peoples' investments/401(k) plans and pay for it through the backdoor with tax increases (larger gov debt will eventually lead to higher taxes - good freakin luck cutting social/entitlement programs etc). I.e., a person like myself with little stock investments will be underwriting other peoples' investments.

I'm open to *draining the swamp* of these finacial problems and taking our medicine for a time. I realize this will have recessionary effects, but do not believe it will be as bad as claimed by many.

Finance is highly international, I've yet to hear anybody explain WHERE our $700B is really gonna go? Have foreigners purchased US backed mortgage securities? Is our money going to anybody anyplace other than the USA? If so, I say "NO". If they can't determine with 100% certainty that our $700Bwon't *leak* to foreigners I say "NO". Have they even considered this in their panic?

I see a lot people here opining how this needs to be passed etc, yet I see very little at this point about what exactly is in this new compromise legislation. I heard it was over 100 pages, I doubt we'll get details and/or any understanding of what it contains for a while. I don't anybody should be voting "YEA" until they are 100% certain of what they are voting for.

Fern

That's actually one of the best ideas I've heard all day: use bankruptcy as a monetary tool and just wipe most of the debt away. That's what we did when we lent money to African countries who we knew would never pay it back. Obviously that would be in layman's terms and it's much more complicated than that, but would banks be so tepid to play nice if all of their toxic debt from the subprime market vanished overnight? Of course, liquidity would still be an issue but the Fed can pump billions (like they did today) into existing programs if it became a problem. And I doubt if all of the toxic debt was just "forgiven", then 700 billion would not be necessary. Thoughts?

Worked great for Argentina!!!

http://en.wikipedia.org/wiki/A...mic_crisis_(1999-2002)

They still haven't recovered and it is 7 years later.

From your link, ORLY?:

While unemployment has been considerably reduced (it's been hovering around 8.5% since 2006), Argentina has so far failed to reach an equitable distribution of income (the wealthiest 10% of the population receives 31 times more income than the poorest 10%). This disparity, nevertheless, compares quite favorably to levels seen in most of Latin America, Asia and Africa.

Yes, ORLY, fucktard. I spent the entire summer and there and no one trusts banks or the government, and the entire economy is being held up with thin shreds of high commodity prices (not anymore!!!) . Constant protests against the Government, 20% inflation, etc. Argentina was one of the richest countries in the world not that long ago, and due to chronic mismanagement they are in a crappy position.

Anecdotal evidence vs my factual information (from YOUR link) and you're name-calling already? There's the Mill I've come to love.

 

[BoberFett]

Originally posted by: eskimospy

Originally posted by: Fern

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

The big buga-boo is the unknow extent of crappy assets.

Banks will do retail lending to people. They won't lend to other banks, or so we hear, because they do not know to what extent the other the banks might be in trouble because of these securities. Quite likely why they won't lend to some companies either (large corps use investments like these securities in their cash management programs - many are thought to hold considerable amounts of this stuff in their porfolios).

So, the problem at the basic level is the lack of knowledge; how does throwing around $700B make the picture any clearer? It doesn't.

However, when you run these companies through bankruptcy you can fix that. They'll come out bankruptcy with this garbage stripped out; that'll make them certifiably good lending candidates.

Look, banks need to lend money; that's how they make money. Every incentive in the world already exist to encourage them to lend, we just need to clean up the uncertainty WRT to the securities.

Fern

$700 billion worth of debt being erased is a pretty colossal disincentive to lend. From everything I've read, we're talking a full scale collapse of the financial system if that happens.

I'll take my economic cues from economists instead of accountants, thanks.

And buying $700B worth of garbage from fools who were too stupid to lend intelligently is a pretty colossal disincentive to lend intelligently in the future.

If they fuck up again, they get another $700B! Yay!

 

[Duddy]

I'm no longer supporting this bailout. I don't think it will work, and believe that it will makes things worse in the long term.

Gimme a strong 1-2 year recession instead of passing this debt to my baby boy. We'll come back strong.

 

[smack Down]

Originally posted by: eskimospy

Originally posted by: BoberFett

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

It's not worthless. The problem is that people just don't know what it's worth. The government will likely be able to sell these securities for as much as they paid for them if not more. (look at Chrysler) We're not giving away $700 billion, in all likelihood we'll get much if not all of it back... the aversion of economic catastrophe is just a bonus!

Except the plain is to pay what the company had paid for the paper 2-3 years ago.

 

[JS80]

Originally posted by: BoberFett

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

OK genius. They are worthless. They produce no cash flow and are not asset backed.

 

[dmcowen674]

Originally posted by: Baked
I just wanna say, "Haaaaaaha!"

I just wanna say "I TOLD YOU SO"

 

[SP33Demon]

Originally posted by: Mill

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: IHateMyJob2004
Hilarious. You must think you know moire than Warren Buffet .... who thinks a failing of this bill will bring about hte great depression. I can give you a link to his statements if you'd like, just PM me.

No need, I read the news. Yet I find it hilarious if you don't think Buffet has a huge stake in how this will play out. His most recent baby. If I were you, I'd take his comments with a grain of salt.

Do you honestly think Buffet cares that much about his personal stake in things anymore? I'm sure the guy that recently gave away the majority of his fortune is just so greedy as to try and manipulate the market. Give me a break.

Buffet owns 38% of Berkshire. While he may not care about money, you have to be stupid if you think he wants his company to get fcked (as well as his friends who own the other 62%).

Berkshire actually went up today, and Buffett has been betting against the US and the dollar for a long time now (he has made a ton doing it). Add in the fact that he is givingit all away, I cannot fathom how you can indict him for being greedy and consumed by personal self-interest. Speaking of "friends" that own part of Berkshire, try Bill and Melinda Gates' foundation that is GIVING ALL THEIR MONEY away as well. They have invested the bulk of it in B shares of Berkshire.

Warren Buffett is only for the bailout because he doesn't want to see breadlines and people without jobs -- not because he is going to profit. Many of his businesses are very recession proof, and if anything he'd benefit from people pouring their money into his shares to stay in the market yet limit their losses.

Fair enough, I'm not saying he's a greedy prick, I actually like the guy. I'm just not entirely convinced that the "no breadlines" angle is his only motive.

 

[Fern]

Originally posted by: eskimospy
-snip-
The problem isn't with lenders being wary of individual customers or the culprits. It's lenders being wary of lending any money AT ALL. Replacing management at some large firms won't do the first thing.
I would argue that's not the problem, it's the resulting symptom of the problem. The (underlying) problem, by all accounts from experts etc (just to make you happy) are securities backed by dubious mortgages. Tons of this stuff has been bundled up.

Bottom line, they need to be unbundled. Until then, the *great unknown* remains just that. Nothing I've seen yet addresses that fundamental problem.

What I'm seeing in the posts here from Fern and others is people replacing the opinion of the vast majority of economists the world over with a 'gut' feeling about how you think things should be. I find that absurd.

More blind uncritical reliance on experts, huh?

^AKA, we should just be sheeple and blindly follow.

Where were all these experts before? Let's face it, Paulson and the others are just guessing; they say so themselves and this is part of the reason they are having trouble getting the House to pass this thing.

 

[SP33Demon]

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy

Originally posted by: SP33Demon

Originally posted by: eskimospy
The mass bankruptcy idea is utterly insane. The entire problem we are having right now is banks that are reluctant to lend money. Do you think the total elimination of $700 billion (or whatever) worth of debt is going to make anyone ever want to lend another dollar ever? That would be an unmitigated catastrophe.

Not implying all debt in this country, only ones that were caught up in the subprime mess. Homeowners have a record for five years, lenders get forced with new management and strict auditing for a decade.

I didn't say all debt, but $700 billion worth of bankruptcies would be catastrophic. All mortgage related debt would be somewhere around $10 trillion. The problem is confidence with lenders. Screwing them out of $700 billion isn't going to restore confidence, it's going to be the final nail in the coffin.

I doubt it, mainly because big lenders definitely knew what they were getting into (i.e. ones that would still remain solvent). Decapitating management from the culprits + strict auditing on whatever baby company that survives would definitely restore confidence IMO. With the Fed pumping additional liquidity into the market (but not 700 billion), everyone will get a clean start.

The problem isn't with lenders being wary of individual customers or the culprits. It's lenders being wary of lending any money AT ALL. Replacing management at some large firms won't do the first thing.

What I'm seeing in the posts here from Fern and others is people replacing the opinion of the vast majority of economists the world over with a 'gut' feeling about how you think things should be. I find that absurd.

Not sure what you mean that lenders will be wary of any money? Are you implying that they won't lend as a result of said bankruptcies? If so, how will they make money then?

There's nothing wrong with discussing/thinking of different theories. If you just took the word of purported economists, nothing would ever go wrong, except a 778 pt stock market crash and 700 billion dollar congressional proposals.

 

[BansheeX]

Originally posted by: eskimospy
I'll take my economic cues from economists instead of accountants, thanks.

The same economists who have been hailing the economy as sound, as the engine of the world, who flat out say deficits don't matter, who were hired by major banks to make millions on shit advice that drove them into the bailout trough, who laughed at the few Austrian economists who bought better performing foreign stocks, never bought a tech stock, shorted subprime, and invested in gold and oil at the lows in 2000?

John Loeffler has a quote you might want to pick up on at some point in your life before you go through it ignorant and misdirected: "If they didn't see it coming, they won't know what to do when it gets here." You have to literally fail an exam in basic economics to get a degree today. Yes, you too, can go to Princeton and get brainwashed by Keynesian idiots like this dumb chick and turn America into a shithouse.

http://www.youtube.com/watch?v=ucDkoqwflF4

 

[BoberFett]

Originally posted by: JS80

Originally posted by: BoberFett

Originally posted by: JS80

They are not giving anyone $700b.

But by purchasing the toxic assets from their balance sheet for a discount price benefits both the bank and the taxpayer.

Most importantly, it will restore liquidity and confidence to the marketplace.

Buying worthless shit for a large sum of money absolutely is a giveaway.

Fucking hell, if you want to buy worthless shit for a billion dollars, come dig through my basement before I pay somebody to haul the garbage... I mean asset away.

Five years from now you'll be able to sell it for more than you paid. I swear. And you'll be keeping me liquid in the meantime, and by keeping me liquid you keep me consuming and the market roaring. See, win/win situation.

:roll:

OK genius. They are worthless. They produce no cash flow and are not asset backed.

If they produce cash flow and are asset backed, then why is the market illiquid? Somebody obviously has the liquid assets to buy them, otherwise where would the feds be getting the cash to buy them? Why not let those same investors buy the securities directly? Why involve the taxpayer?

This is the fundamental problem of this whole situation as far as I'm concerned. All of you "experts" are using circular logic and somewhere in the circle, someone is getting screwed.