What's wrong with just letting the companies fail?

[boomerang]

I'll be 55 this year. I decided yesterday that I've got to get my act together regarding my health. Or, maybe I should say the future of my health. I passed a physical last year (including a stress test) with flying colors.

We as humans all have weaknesses. For some it's booze, some sex, some drugs, etc. Mine is sweets. Not food, sweets. My father was a recovered alcoholic, my sister is a recovered meth addict. Too late for her, as she fried her brain in the process.

I've successfully given up my bad eating habits three times thus far in my life, but I keep falling off the wagon.

I've been looking for a reasonably priced treadmill. A starter model. Winters are too damned cold and icy to run. Plus, I live in a rural area with no sidewalks and don't relish running on roads with a 55 mph speed limit.

 

[Zebo]

You can eat all you want if you get HR in zone 4 or 5 for 45 mintues a day on your HRM. It's hard, like murder, the first month then you will want to do it. Diets are BS for lots of reasons I wont get into here.

To bad you're in Michigan... I have a sweet Landice treadmill gathering spiders in metal shed I'd cut you a deal on.... I could not run on them made me dizzy.

Don't buy a starter model if you're a big man...will break, burn out and slip. You need a wide track and something like a Trotter or Landice.


YHPM

 

[Lemon law]

In the case of the bankers and stockbrokers, the argument I despise is the pay one. They argue that if we do not highly compensation, them, they will simply move on to some other bank and receive higher compensation. Simply not so when when people in a service industry like banking and stockbrokering are being over paid if they receive minimum wage, if those jerks worked at Chicken Mc Nugget or as garbage men, they would have been fired for incompetence.

And when the whole banking and stock business is sick, it a supply and demand business, too much supply and no demand means huge wage cuts should be demanded. Because there is no moving down the street
as all those basically worth less people are all in the same boat.

 

[StageLeft]

Originally posted by: boomerang
I'll be 55 this year. I decided yesterday that I've got to get my act together regarding my health. Or, maybe I should say the future of my health. I passed a physical last year (including a stress test) with flying colors.

We as humans all have weaknesses. For some it's booze, some sex, some drugs, etc. Mine is sweets. Not food, sweets. My father was a recovered alcoholic, my sister is a recovered meth addict. Too late for her, as she fried her brain in the process.

I've successfully given up my bad eating habits three times thus far in my life, but I keep falling off the wagon.

I've been looking for a reasonably priced treadmill. A starter model. Winters are too damned cold and icy to run. Plus, I live in a rural area with no sidewalks and don't relish running on roads with a 55 mph speed limit.

Then we share something in common. Junk food is my vice as well. I have nothing else that pulls me in bad directions except for a stomach that cannot get enough sugar in it. I do keep in good shape but it is ever-present on my mind to varying degrees. Sure beats an addiction to alcohol or smoking, though :thumbsup:

 

[XZeroII]

Good lord, it's like the blind leading the blind around here.

The issue is incredibly simple, but most of you are turning into a big complex thing.

Here is why in very understandable terms:

If a large company goes under, then potentially hundreds of thousands, if not millions of people could lose their jobs. It also means that othe companies that rely on that company that failed will lose revenue and will lay off people or go bankrupt as well. This causes TONS of people to become unemployed. Once people are unemployed, they stop spending money. When people stop spending money, companies start to lose money. This causes more companies to lay people off which causes more people to stop spending. It's a cycle that is VERY hard to break.

If one big company goes under while times are good, we can absorb the damage because we have enough upward momentum. But once that momentum starts swinging down, action needs to be taken.


Please note, I do NOT approve of the current stimulus package. I am mearly simplifying the problem down so that people can understand.

 

[LegendKiller]

Originally posted by: chess9
I think we should let banks fail. If they don't fail, and are constantly bailed out, when and how will they learn? As a corrolary to letting them fail, however, we must also regulate banks tightly. Repeal of Glass-Steagall was obviously one of our big mistakes.

Ditto for Wall Street firms, but regulate them tightly.

-Robert

So why can't we jut keep them alive, not for the benefit of themsleves, but for the benefit of the people, and regulate them tightly after we get out of this situation?

The big issue people don't seem to get is that if the banks fail, businesses will fail in droves. AS somebody mentioned already, when Lehman failed it sent massive shockwaves through the credit system. Rates on all sorts of securitization debt increased 2-3% overnight. Not only did the interest rate go up, but the amount of credit offered plummeted. Up until that point my group could pursue securitization transactions, after that point we could not. Mainly because nobody knew where the system would go.

I've turned down ~5BN worth of conduit capacity now to very high-grade non-consumer corporate credits. I've been offered whatever terms I want. One deal that was priced at .30% over my Cost of Funds with a .20% up-front fee on a 'A' deal from a BBB client with 50% of the borrowers in the transaction being BBB or higher, was offered to me at 3.0% over COF, 1% up-front, with a AAA structure.

That was an insane deal. On a 400MM deal, I went from being able to make 1.2MM over the year and 800K up-front on a 'A' deal, to being able to make 12MM over the year and $4MM up-front on a deal that was structured MUCH better with far less risk. I would be the one structuring the deal, so I wouldn't have to depend on the actual rating agencies for anything. Yet, I STILL could not do that deal.

So where do you think that money comes from? It eats into their margins and forced them to reduce headcount or other costs.

You see that with Wyndham Worldwide. Right now they can't get ANY financing from traditional term securitization buyers. Their conduit banks reduced by 20%, their advance rates plummeted and their costs went up. As a result they had to scale back sales by 40%, reducing their staff by 40% and laying off more than 5K people.

This isn't some fucking joke that doesn't affect real people. This is a real problem, affecting real people.

 

[StageLeft]

Originally posted by: XZeroII
Good lord, it's like the blind leading the blind around here.

The issue is incredibly simple, but most of you are turning into a big complex thing.

Here is why in very understandable terms:

If a large company goes under, then potentially hundreds of thousands, if not millions of people could lose their jobs. It also means that othe companies that rely on that company that failed will lose revenue and will lay off people or go bankrupt as well. This causes TONS of people to become unemployed. Once people are unemployed, they stop spending money. When people stop spending money, companies start to lose money. This causes more companies to lay people off which causes more people to stop spending. It's a cycle that is VERY hard to break.

If one big company goes under while times are good, we can absorb the damage because we have enough upward momentum. But once that momentum starts swinging down, action needs to be taken.


Please note, I do NOT approve of the current stimulus package. I am mearly simplifying the problem down so that people can understand.

Presumably by action you mean stimulus.

 

[Zebo]

Originally posted by: XZeroII
Good lord, it's like the blind leading the blind around here.

The issue is incredibly simple, but most of you are turning into a big complex thing.

Here is why in very understandable terms:

If a large company goes under, then potentially hundreds of thousands, if not millions of people could lose their jobs. It also means that othe companies that rely on that company that failed will lose revenue and will lay off people or go bankrupt as well. This causes TONS of people to become unemployed. Once people are unemployed, they stop spending money. When people stop spending money, companies start to lose money. This causes more companies to lay people off which causes more people to stop spending. It's a cycle that is VERY hard to break.

If one big company goes under while times are good, we can absorb the damage because we have enough upward momentum. But once that momentum starts swinging down, action needs to be taken.


Please note, I do NOT approve of the current stimulus package. I am mearly simplifying the problem down so that people can understand.

Raed the thraed next time, I know it hard over our workout routines , but Bill said as much in first paragraph...

My only question for you if how big next time they fail, and the next, and the next...?? Many of these companies have been uncompetitive for awhile or see no light at end of tunnel so simply pumping money into them is breaking tax payer while only delay inevitable.

 

[smack Down]

Originally posted by: LegendKiller

Originally posted by: chess9
I think we should let banks fail. If they don't fail, and are constantly bailed out, when and how will they learn? As a corrolary to letting them fail, however, we must also regulate banks tightly. Repeal of Glass-Steagall was obviously one of our big mistakes.

Ditto for Wall Street firms, but regulate them tightly.

-Robert

So why can't we jut keep them alive, not for the benefit of themsleves, but for the benefit of the people, and regulate them tightly after we get out of this situation?

The big issue people don't seem to get is that if the banks fail, businesses will fail in droves. AS somebody mentioned already, when Lehman failed it sent massive shockwaves through the credit system. Rates on all sorts of securitization debt increased 2-3% overnight. Not only did the interest rate go up, but the amount of credit offered plummeted. Up until that point my group could pursue securitization transactions, after that point we could not. Mainly because nobody knew where the system would go.

I've turned down ~5BN worth of conduit capacity now to very high-grade non-consumer corporate credits. I've been offered whatever terms I want. One deal that was priced at .30% over my Cost of Funds with a .20% up-front fee on a 'A' deal from a BBB client with 50% of the borrowers in the transaction being BBB or higher, was offered to me at 3.0% over COF, 1% up-front, with a AAA structure.

That was an insane deal. On a 400MM deal, I went from being able to make 1.2MM over the year and 800K up-front on a 'A' deal, to being able to make 12MM over the year and $4MM up-front on a deal that was structured MUCH better with far less risk. I would be the one structuring the deal, so I wouldn't have to depend on the actual rating agencies for anything. Yet, I STILL could not do that deal.

So where do you think that money comes from? It eats into their margins and forced them to reduce headcount or other costs.

You see that with Wyndham Worldwide. Right now they can't get ANY financing from traditional term securitization buyers. Their conduit banks reduced by 20%, their advance rates plummeted and their costs went up. As a result they had to scale back sales by 40%, reducing their staff by 40% and laying off more than 5K people.

This isn't some fucking joke that doesn't affect real people. This is a real problem, affecting real people.

securitization is done there is way to much fraud involved for anyone with half a brain to trust your AAA rates.

 

[LegendKiller]

Originally posted by: smack Down


securitization is done there is way to much fraud involved for anyone with half a brain to trust your AAA rates.

LOL, securitization is far from done and the fraud was actually pretty limited. Simple logic shows the value of a AAA. Maybe your 1/2 brain can't wrap around the subject, but that doesn't mean everybody is as stupid as you. Go back to trying to figure out plane+treadmill.

 

[Zebo]

Originally posted by: Skoorb

Originally posted by: boomerang
I'll be 55 this year. I decided yesterday that I've got to get my act together regarding my health. Or, maybe I should say the future of my health. I passed a physical last year (including a stress test) with flying colors.

We as humans all have weaknesses. For some it's booze, some sex, some drugs, etc. Mine is sweets. Not food, sweets. My father was a recovered alcoholic, my sister is a recovered meth addict. Too late for her, as she fried her brain in the process.

I've successfully given up my bad eating habits three times thus far in my life, but I keep falling off the wagon.

I've been looking for a reasonably priced treadmill. A starter model. Winters are too damned cold and icy to run. Plus, I live in a rural area with no sidewalks and don't relish running on roads with a 55 mph speed limit.

Then we share something in common. Junk food is my vice as well. I have nothing else that pulls me in bad directions except for a stomach that cannot get enough sugar in it. I do keep in good shape but it is ever-present on my mind to varying degrees. Sure beats an addiction to alcohol or smoking, though :thumbsup:

I hate sweets. Never liked them. Booze OTOH... I drink a bottle of Scotch a week. Love to play poker with a couple glasses of Glenmorangie on ice. Maybe that's why my ROI sucks..

 

[chess9]

Originally posted by: LegendKiller

Originally posted by: chess9
I think we should let banks fail. If they don't fail, and are constantly bailed out, when and how will they learn? As a corrolary to letting them fail, however, we must also regulate banks tightly. Repeal of Glass-Steagall was obviously one of our big mistakes.

Ditto for Wall Street firms, but regulate them tightly.

-Robert

So why can't we jut keep them alive, not for the benefit of themsleves, but for the benefit of the people, and regulate them tightly after we get out of this situation?

The big issue people don't seem to get is that if the banks fail, businesses will fail in droves. AS somebody mentioned already, when Lehman failed it sent massive shockwaves through the credit system. Rates on all sorts of securitization debt increased 2-3% overnight. Not only did the interest rate go up, but the amount of credit offered plummeted. Up until that point my group could pursue securitization transactions, after that point we could not. Mainly because nobody knew where the system would go.

I've turned down ~5BN worth of conduit capacity now to very high-grade non-consumer corporate credits. I've been offered whatever terms I want. One deal that was priced at .30% over my Cost of Funds with a .20% up-front fee on a 'A' deal from a BBB client with 50% of the borrowers in the transaction being BBB or higher, was offered to me at 3.0% over COF, 1% up-front, with a AAA structure.

That was an insane deal. On a 400MM deal, I went from being able to make 1.2MM over the year and 800K up-front on a 'A' deal, to being able to make 12MM over the year and $4MM up-front on a deal that was structured MUCH better with far less risk. I would be the one structuring the deal, so I wouldn't have to depend on the actual rating agencies for anything. Yet, I STILL could not do that deal.

So where do you think that money comes from? It eats into their margins and forced them to reduce headcount or other costs.

You see that with Wyndham Worldwide. Right now they can't get ANY financing from traditional term securitization buyers. Their conduit banks reduced by 20%, their advance rates plummeted and their costs went up. As a result they had to scale back sales by 40%, reducing their staff by 40% and laying off more than 5K people.

This isn't some fucking joke that doesn't affect real people. This is a real problem, affecting real people.

LK: Yes, I know it affects real people and real jobs, but we seem to be simply putting off the inevitable and saddling our kids and grandkids with huge amounts of debt.

Regarding Wyndham, I almost lept out of my chair when I saw their name because one of my best friends got laid off from them in Orlando. They have let over 1,000 people go. Their business was tied to the time-share market in large part, and that business has gone so far South it's now going North.

The suggestion that we rescue banks now and regulate them later is fine if two preconditions are met: 1. We actually regulate tightly later. Big IF!; 2. We don't spend so much money rescueing the bankers that our Treasury Debt puts us and our kids/grandkids in over our heads. Given that Geithner is having to 'test' the value of these banks, I suspect he knows this problem is grossly UNDERSTATED. He probably also knows he and Obama will be the fall guys when this all goes South, which I fear it will. (I hope it works, because our lives are at stake!)

Unless and until America commits to heavy regulation of businesses, then we are a CAPITALISTIC nation and should honor our principles. As things stand, we are very wishy washy about what regulations we will countenance. You see this in SPADES with Northern Rock and The Bank of England. They were poorly regulated because everyone, including Labour ministers who got big government bonuses, were awash in dosh. Now, England is being plunged into something akin to the Dark Ages. I wouldn't be surprised to see Feudalism there next. j/k

Huge bummer on those deals...for you!!

-Robert

 

[Thump553]

LK you raise some really cogent points, but I have to admit I am straying from supporting financial bailouts any further without a drastic overhaul in regulations in place FIRST. "Too big to fail" is very real, but it also is a major factor as to why we got where we are today. Under any of the current financial bailout plans being circulated today it is inevitable that the big will get even bigger. We will be spending a lot of taxpayer dollars and probably just pushing the problem five or ten or twenty years down the road. At that point the pain and cost will be multiples higher than they are now.

One of the reasons I want effective regulation first is to break the mentality that currently dominates the financial market. Using 18+ billion of bailout money for bonuses in an admittedly nonperforming industry is, in my book, both larcenous and unpatriotic. It's time to clean house, and unlike Geithner I have absolutely no faith in the boards of directors to do so-they are too intertwined.

There was a MIT economist on Bill Moyers Journal last week, Simon Johnson, who scored a lot of points with me. Below is a link to the transcript of his segment, it is well worth the five minutes to read as it presents a refreshingly new, and practical solution to the current bailouts (one third of page down, either click button to watch podcast or to read transcript):

Simon Johnson "reboot" plan for financial markets using FDIC

 

[LegendKiller]

Originally posted by: chess9
LK: Yes, I know it affects real people and real jobs, but we seem to be simply putting off the inevitable and saddling our kids and grandkids with huge amounts of debt.

Regarding Wyndham, I almost lept out of my chair when I saw their name because one of my best friends got laid off from them in Orlando. They have let over 1,000 people go. Their business was tied to the time-share market in large part, and that business has gone so far South it's now going North.

The suggestion that we rescue banks now and regulate them later is fine if two preconditions are met: 1. We actually regulate tightly later. Big IF!; 2. We don't spend so much money rescueing the bankers that our Treasury Debt puts us and our kids/grandkids in over our heads. Given that Geithner is having to 'test' the value of these banks, I suspect he knows this problem is grossly UNDERSTATED. He probably also knows he and Obama will be the fall guys when this all goes South, which I fear it will. (I hope it works, because our lives are at stake!)

Unless and until America commits to heavy regulation of businesses, then we are a CAPITALISTIC nation and should honor our principles. As things stand, we are very wishy washy about what regulations we will countenance. You see this in SPADES with Northern Rock and The Bank of England. They were poorly regulated because everyone, including Labour ministers who got big government bonuses, were awash in dosh. Now, England is being plunged into something akin to the Dark Ages. I wouldn't be surprised to see Feudalism there next. j/k

Huge bummer on those deals...for you!!

-Robert

The situation in Orlando hit me pretty hard. I knew/know dozens of people there, I worked in that office for 3 years doing securitization issuance.

I certainly agree that we need to regulate much tighter. This situation should never have happened, but it wasn't any one problem but a problem of several situations. De/Under-regulation of CDS and securitization itself was a huge problem.

Thump: I agree that the bonuses handed out are ridiculous. However, you're now seeing a mass exodus of financial professionals to other banks and/or wealth funds that are willing to pay them bonuses that the US isn't willing to pay them.

Keep in mind, the people who caused this problem are GONE, except the CEOs and other C-level execs. The people who are left are the ones who didn't cause it and are actually doing some good in the businesses. They need to be retained or the money put into the banks will be wasted as they decline in worth.

 

[smack Down]

Originally posted by: chess9

Originally posted by: LegendKiller

Originally posted by: chess9
I think we should let banks fail. If they don't fail, and are constantly bailed out, when and how will they learn? As a corrolary to letting them fail, however, we must also regulate banks tightly. Repeal of Glass-Steagall was obviously one of our big mistakes.

Ditto for Wall Street firms, but regulate them tightly.

-Robert

So why can't we jut keep them alive, not for the benefit of themsleves, but for the benefit of the people, and regulate them tightly after we get out of this situation?

The big issue people don't seem to get is that if the banks fail, businesses will fail in droves. AS somebody mentioned already, when Lehman failed it sent massive shockwaves through the credit system. Rates on all sorts of securitization debt increased 2-3% overnight. Not only did the interest rate go up, but the amount of credit offered plummeted. Up until that point my group could pursue securitization transactions, after that point we could not. Mainly because nobody knew where the system would go.

I've turned down ~5BN worth of conduit capacity now to very high-grade non-consumer corporate credits. I've been offered whatever terms I want. One deal that was priced at .30% over my Cost of Funds with a .20% up-front fee on a 'A' deal from a BBB client with 50% of the borrowers in the transaction being BBB or higher, was offered to me at 3.0% over COF, 1% up-front, with a AAA structure.

That was an insane deal. On a 400MM deal, I went from being able to make 1.2MM over the year and 800K up-front on a 'A' deal, to being able to make 12MM over the year and $4MM up-front on a deal that was structured MUCH better with far less risk. I would be the one structuring the deal, so I wouldn't have to depend on the actual rating agencies for anything. Yet, I STILL could not do that deal.

So where do you think that money comes from? It eats into their margins and forced them to reduce headcount or other costs.

You see that with Wyndham Worldwide. Right now they can't get ANY financing from traditional term securitization buyers. Their conduit banks reduced by 20%, their advance rates plummeted and their costs went up. As a result they had to scale back sales by 40%, reducing their staff by 40% and laying off more than 5K people.

This isn't some fucking joke that doesn't affect real people. This is a real problem, affecting real people.

LK: Yes, I know it affects real people and real jobs, but we seem to be simply putting off the inevitable and saddling our kids and grandkids with huge amounts of debt.

Regarding Wyndham, I almost lept out of my chair when I saw their name because one of my best friends got laid off from them in Orlando. They have let over 1,000 people go. Their business was tied to the time-share market in large part, and that business has gone so far South it's now going North.

The suggestion that we rescue banks now and regulate them later is fine if two preconditions are met: 1. We actually regulate tightly later. Big IF!; 2. We don't spend so much money rescueing the bankers that our Treasury Debt puts us and our kids/grandkids in over our heads. Given that Geithner is having to 'test' the value of these banks, I suspect he knows this problem is grossly UNDERSTATED. He probably also knows he and Obama will be the fall guys when this all goes South, which I fear it will. (I hope it works, because our lives are at stake!)

Unless and until America commits to heavy regulation of businesses, then we are a CAPITALISTIC nation and should honor our principles. As things stand, we are very wishy washy about what regulations we will countenance. You see this in SPADES with Northern Rock and The Bank of England. They were poorly regulated because everyone, including Labour ministers who got big government bonuses, were awash in dosh. Now, England is being plunged into something akin to the Dark Ages. I wouldn't be surprised to see Feudalism there next. j/k

Huge bummer on those deals...for you!!

-Robert

Trying to prevent this type of problem with regulation has been tried in the past and failed. There is simply to much money to be made by changing the regulations so they will not be enforced. Look up the term regulatory capture

 

[Jaskalas]

Originally posted by: net
hmmm, well i don't know. how do you get your food? do you hunt or does a company sell it to you?

food
gas
electricity
clothes
toiletries
etc...

which one on the list do we provide for ourselves?

we as a people don't even have enough resources in our own country to provide for everyone.

I take it you mean to tell us, that we won't have food and water and it's the end of the world if we let the irresponsible pay for their mistakes and let the responsible step in to take their place?

 

[XZeroII]

Originally posted by: Skoorb

Originally posted by: XZeroII
Good lord, it's like the blind leading the blind around here.

The issue is incredibly simple, but most of you are turning into a big complex thing.

Here is why in very understandable terms:

If a large company goes under, then potentially hundreds of thousands, if not millions of people could lose their jobs. It also means that othe companies that rely on that company that failed will lose revenue and will lay off people or go bankrupt as well. This causes TONS of people to become unemployed. Once people are unemployed, they stop spending money. When people stop spending money, companies start to lose money. This causes more companies to lay people off which causes more people to stop spending. It's a cycle that is VERY hard to break.

If one big company goes under while times are good, we can absorb the damage because we have enough upward momentum. But once that momentum starts swinging down, action needs to be taken.


Please note, I do NOT approve of the current stimulus package. I am mearly simplifying the problem down so that people can understand.

Presumably by action you mean stimulus.

Yes, that is one option.

 

[LegendKiller]

Originally posted by: smack Down
Trying to prevent this type of problem with regulation has been tried in the past and failed. There is simply to much money to be made by changing the regulations so they will not be enforced. Look up the term regulatory capture

Selective regulation and not removing old regulation (Glass Steagall) would have easily prevented this whole situation.

 

[BoberFett]

Originally posted by: Zebo

Originally posted by: bamacre

Originally posted by: Evan
Basic question you have to ask is, when in history has "letting the market figure it out" actually worked?

http://en.wikipedia.org/wiki/1921_recession

The recession of 1921-1923 proved to be the sharpest economic downturn since the emergence of the business cycle in the early 19th century, but it also was one of the shortest reversals. The government intervened to a greater extent, but wage rates were permitted to fall, and government expenditures and taxes were reduced. The recession was over in one year.

Evan rather have billionaire bankers and favored govt contractors get billions, which they stash in off-shore havens usually so they can't be sued we we find out about their theft from our children and children's children.

rather than short painful but real recovery and rebirth.

It doesn't matter what Evan thinks, he's a help desk jockey.

 

[palehorse]

Originally posted by: eskimospy

Originally posted by: palehorse

Originally posted by: manlymatt83
All of these banks. All of these companies that made mistakes. What ever happened to Free Trade? I'm not 100% in support of free trade, because from what I've learned, it eventually causes economic abuse, shutdown of small businesses, garbage dumping in 3rd world countries, etc... but for the most part, why can't we just let the companies that did poor jobs fail, go into bankruptcy, and let them come out restructured under new, proper management?

That appears to be the $10 trillion question... and one that I've yet to see answered to my satisfaction, by anyone.

Fundamentally because the markets are behaving irrationally right now and the value of the assets that the major banks hold is considerably higher than what the world is currently willing to label them as (due to irrational fear). Therefore, rescuing the banks in their current state leads to reasonably small capital investments that prevent far larger capital losses.

Economics 101. This has been explained repeatedly.

"reasonably small capital investments" my ass...

 

[XZeroII]

Originally posted by: Zebo

Originally posted by: XZeroII
Good lord, it's like the blind leading the blind around here.

The issue is incredibly simple, but most of you are turning into a big complex thing.

Here is why in very understandable terms:

If a large company goes under, then potentially hundreds of thousands, if not millions of people could lose their jobs. It also means that othe companies that rely on that company that failed will lose revenue and will lay off people or go bankrupt as well. This causes TONS of people to become unemployed. Once people are unemployed, they stop spending money. When people stop spending money, companies start to lose money. This causes more companies to lay people off which causes more people to stop spending. It's a cycle that is VERY hard to break.

If one big company goes under while times are good, we can absorb the damage because we have enough upward momentum. But once that momentum starts swinging down, action needs to be taken.


Please note, I do NOT approve of the current stimulus package. I am mearly simplifying the problem down so that people can understand.

Raed the thraed next time, I know it hard over our workout routines , but Bill said as much in first paragraph...

My only question for you if how big next time they fail, and the next, and the next...?? Many of these companies have been uncompetitive for awhile or see no light at end of tunnel so simply pumping money into them is breaking tax payer while only delay inevitable.

I simplified the whole situation so that people could understand. Bill talked about 'toxic debts' and stuff that no one here can follow.

I'm not sure if you even really read my post. I specifically said that 'action needs to be taken.' This does NOT only mean that we need to hand out money. Sure, that is one option, but my post was very generic and meant that an external influence is needed to correct the system.

 

[LegendKiller]

Originally posted by: BoberFett


It doesn't matter what Evan thinks, he's a help desk jockey.

Who has far more education and knowledge in finance/economics than you. What the fuck do you do sparky? Weren't you the guy filling up the toilette paper at the mall last night?

 

[Zebo]

Originally posted by: LegendKiller

Originally posted by: BoberFett


It doesn't matter what Evan thinks, he's a help desk jockey.

Who has far more education and knowledge in finance/economics than you. What the fuck do you do sparky? Weren't you the guy filling up the toilette paper at the mall last night?

We see how those so called experts have us in a pickle now. I bet he can balance his own check book unlike them. We'll see how the economists do after the reverse dust bowl, usually mealy mouthed little twerps wouldn't make a week in the wild, the real free market, I know who i put my money on.

 

[chess9]

http://www.slate.com/id/2211168/

A few more reasons to NOT bail out bankers. They are SLUTS. Brain dead SLUTS to boot.

These are LEADERS? LMFAO!

-Robert

 

[LegendKiller]

Originally posted by: Zebo

Originally posted by: LegendKiller

Originally posted by: BoberFett


It doesn't matter what Evan thinks, he's a help desk jockey.

Who has far more education and knowledge in finance/economics than you. What the fuck do you do sparky? Weren't you the guy filling up the toilette paper at the mall last night?

We see how those so called experts have us in a pickle now. I bet he can balance his own check book unlike them. We'll see how the economists do after the reverse dust bowl, usually mealy mouthed little twerps wouldn't make a week in the wild, the real free market, I know who i put my money on.

Keep in mind that SOME people got us into trouble, not all.