Comments on: Government Bail out fails – That's a good thing

By: Girls Just Wanna Have Funds-Personal Finance For Women

Girls Just Wanna Have Funds-Personal Finance For Women — Mon, 06 Oct 2008 12:06:14 +0000

[...] Glblguy from Gather Little by Little presents Government Bail out fails – Thats a good thin [...]

By: Weekend Linkityness: Two for the price of one! « The Faery Inn

Weekend Linkityness: Two for the price of one! « The Faery Inn — Sat, 04 Oct 2008 22:14:34 +0000

[...] Economic Crisis: Government Bail-Out Fails: That’s a Good Thing ~ Gather Little by Little Could Good Come Out of the Economic Crisis? ~ Being [...]

By: Opinionator

Opinionator — Thu, 02 Oct 2008 19:27:27 +0000

Congratulations to you taxpayers who who were adamantly opposed to the $ 700 billion bailout. The House of Reps voted against it. Immediately the stock market plunged to its biggest point loss in history (777 points on the DOW). International markets are plunging around the world. The U.S stock market has lost $1.4 TRILLION in value, thats 2X the $ 700 billion plan. If we had completed the $ 700 billion bailout, most or all of it would have been recovered and there may have even been a taxpayer profit made of up to $ 2 Trillion.

Everyone is way over-exaggerating the bailout at $700 Billion. What people don’t understand is that this money is not being spent – it is being invested in assets (loans) at fire-sale prices. These loans will be restructured and re-sold over time and taxpayers will make a profit.

We are collectively $ 1.4 Trillion poorer today. This number may increase if panic ensues. Be prepared to watch your Pension Plan fold up and not pay any benefits, your IRAs and 401Ks go to half of what they were. Be prepared for many of your insurance providers to fold up and not pay you a dime. Be prepared for your employer to stop giving you a paycheck because they can’t get the short term loans and cash they need to make payroll or manufacture products to sell.

The taxpayers have just shot each other in the foot. Why – because of a complete misunderstanding of how our economy works and because the media has fueled the fire of populist emotion without clearly explaining the logical conclusion of these bailouts – which are not nearly that bad. Lets just hope its not a fatal wound. see my blog on this at http://investingandeconomics.blogspot.com/

By: Kathryn

Kathryn — Wed, 01 Oct 2008 15:03:08 +0000

We did a “Happy Dance” in our house. I understand there is economic instability and the bailout is meant to restore confidence. my suggestion? Remove capital gains tax and let those with money go shopping for stocks at bargain basement prices. Allow the market to fix itself. I realize that to remove the income generated by capital gains takes money out of the system; however, it promotes less additional debt than $700 billion.

By: Bettsi

Bettsi — Tue, 30 Sep 2008 21:44:34 +0000

I’m surprised there aren’t more comments. I think the average American doesn’t know what to think. I know that when I tried to get a home loan in the late eighties, I couldn’t get one. I didn’t like it, but I trusted that the lenders knew what they were doing. I trusted them again in 2003 when I did get a home loan and again in 2005 when I did a re-fi. Now, I know that I was wrong to do so. I feel cynical and betrayed. All “markets” are constructs that I guess we have to “buy” into, but I wish I understood it a little better.

By: Kacie

Kacie — Tue, 30 Sep 2008 16:00:34 +0000

I agree with Laura. I think we need just a bit more time to make sure we’re doing the right thing with such a huge sum of money.

I don’t even try to pretend I understand what’s going on (though I am trying) but for now I’m not feeling too stressed. Certainly that could change, though.

By: Mr. ToughMoneyLove

Mr. ToughMoneyLove — Tue, 30 Sep 2008 15:45:00 +0000

Ron – I am less concerned about the market and more concerned now about having business clients who can afford to hire me and pay my bills so I don’t have to lay off employees. I think Paulson is also worried about that.

By: Ron@TheWisdomJournal

Ron@TheWisdomJournal — Tue, 30 Sep 2008 15:31:15 +0000

No matter how you slice it, now much someone cries that the sun won’t come up tomorrow, this bail out / intervention / meddling was a bad idea. The deal, as it was structured, allowed the Treasury secretary to spend the money as he saw fit, buying up mortgage paper for the amount HE chose. The man’s a trader and he was jazzed by that amount of power in my opinion. How would YOU like the ability to play the market like THAT?

In a true free market, the losers pay and pay dearly. We don’t have anything close to a free market anymore.

By: jim of Blueprint for Financial Prosperity

jim of Blueprint for Financial Prosperity — Tue, 30 Sep 2008 15:23:29 +0000

I don’t think people fully understand the impact of this credit crisis, while it’s not a perfect solution, it’s something that’s needed to calm the markets so that credit can still be extended. One telling statistic is the amount of commercial paper available, which are short term loans that businesses need to conduct business, and it’s gone down significantly. I’m hardly an expert on this but we can’t continue to do nothing, the tightening will continue and we will face a severe economic slowdown/recession/whatever.

By: Mr. ToughMoneyLove

Mr. ToughMoneyLove — Tue, 30 Sep 2008 14:42:06 +0000

Your analysis mimics that of most voters who this week indundated the inboxes of Congress. If you think the rescue bill was socialism in disguise, just wait for what happens when a Democrat President and Congress get together on jobless benefits, job creation, and other rescue packages for all those who will become unemployed if the bill is not passed. You will pay for it (if you keep your job) with massive tax increases and/or inflation. As for as socialism goes, the AIG bailout is a better example, as are the loan packages for the car companies which quietly passed Congress last week as well.