Bailout Necessary?

[treehugger1]

After giving the entire financial bailout plan some thought, I've made the personal decision that I cannot support the bailout as suggested.

As you are all very well aware, WAMU failed, but Morgan/Chase stepped in to take over.

Buffet has moved to acquire $5 billion of Goldman Sachs

BOA steps into Lehman issues.

Discussion of a bailout plan not being approved drives oil prices down.

The list of free market activities seems to grow everyday.

I say no bailout. If the banks fail, then they fail. Will they all fail? Nope. Let the FDIC pick up the tab for depositor's money. This may be far less expensive then the $700 billion bailout plan. So far, I don't think the FDIC has had to come up with a great deal of money.

Will people lose their jobs? Yep. But, I believe this will happen with or without the $700 Bil plan. Will inflation increase or decrease? There appear to be a lot of theories out on this. It does seem that available credit does lead to inflation.

There is an argument that credit must flow to drive the economy. No doubt this is true, but the method of granting and receiving credit should have to change. I just looked at ratings for several local banks and credit unions in my region, and they have very high ratings and a great deal of liquidity. [Edit-add: They will probably continue to make money available.]

Let the free market reign. We are already seeing portions of the market react in this manner.

I just sent emails to my congressional representatives telling them where I stand.

Perhaps we (the world) needs to step back and take a deep breath and see how all the hands are played out.

In terms of how to deal with the mortgage issue, I have no thoughts, other than the current bailout proposal does not appear to provide a great deal of hope at the consumer housing level.

Just my not-so-humble opinions.

[BigJohn]

I agree.

I can't believe people wanted a bailout with so little information coupled with a rush to sign so quickly. This sounded so much like we must go to Iraq because of WMDs only to find out there were none.

[chloe0724]

BOA bought Merril Lynch, Lehman went BK.

The FDIC only has 29 billion left in its coffers. BOA alone has 792 billion in deposits.

I don't feel that the plan as it is is great, but if all the banks were left to fail, it would cause a much more dire situation than we are currently in.

[Mi Bankruptcy]

I made this point in another thread.. It has taken me months of research and evaluation of my own financial status to decide Bankruptcy is the best solution. I don't care how many people are working on a solution. You( congress) can't come up with a plan in 5 days. At least one that I will support.

[Flowers]

treehug: I agree with free market, though, it makes me wonder why the federal government then lets folks write-off the interest they pay on mortgages. Is this not a conflict of interest and a "promotion" of mortgages/consumption of banking services/
what do you think?

[AngelinaCatHub]

Treehug:....... The party's over, it's time to clean up, not party on. You are right 'Hub

[AngelinaCatHub]

P.S.

I think it is contrived.

[banca rotta]

I think the democrats painted themselves into a corner with this.

They hold the majority and have enough votes to pass it but for now the republicans in the minority won't support it in it's present form and they are being blamed for holding it up.

The dem leaders want everyone to jump together since main street USA doesn't want it. No one party in congress wants to be supporting an unpopular, Bush bailout helping the rich (At least that's how it's being labeled). If this plan fails heads will roll everywhere, every office, every pol party.

[treehugger1]

I rather see national debt taken on to shore up the FDIC, then bail out a few big banks. And, if I recall, Lehman did go BK but their assets didn't "disappear" but were/will be picked up by other institutions.

In terms of mortgage interest taken against taxes, I would personally be okay with shutting this down also. You would, of course, create another drop in housing prices once folks realized there was no tax break for the interest paid. The truth is that we allow mortgage interest dedcution, but I can't deduct taxes already paid for fuel, naturl gas, electrical power, phone service, etc. It all seems a bit screwed up.

As 'Hub stated, "the party is over." Let's start cleaing up. The opportunity has been dumped in our laps.

[banca rotta]

I rather see national debt taken on to shore up the FDIC, then bail out a few big banks. And, if I recall, Lehman did go BK but their assets didn't "disappear" but were/will be picked up by other institutions.

In terms of mortgage interest taken against taxes, I would personally be okay with shutting this down also. You would, of course, create another drop in housing prices once folks realized there was no tax break for the interest paid. The truth is that we allow mortgage interest dedcution, but I can't deduct taxes already paid for fuel, naturl gas, electrical power, phone service, etc. It all seems a bit screwed up.

As 'Hub stated, "the party is over." Let's start cleaing up. The opportunity has been dumped in our laps.

Agreed!

[JRScott]

I agree with Tree.

Though Tree if they pass this legislation every one that votes yes or present most likely will find new jobs after the election, the bill and measure is so unpopular any of them in a close race will most likely lose their seats.

[fltoo]

Not crazy about this bailout either.

I don't know about eliminating the mortgage interest deduction. This would further send the housing market plummeting.

Cutting taxes seems to me to be the way to pump money into the economy.
Can you imagine the money that investors would put into Wall Street if the capital gains tax was eliminated for a couple of years?

Remember when cc interest was tax deductible? It helped grow the cc card industry.

We need a good business man to draft something to get us out of this mess. These Congress people (AKA lawyers) have little or no experience at running a business as large as the USA.

[fltoo]

I agree with Tree.

Though Tree if they pass this legislation every one that votes yes or present most likely will find new jobs after the election, the bill and measure is so unpopular any of them in a close race will most likely lose their seats.

Good. We need fresh blood in Congress.

[chloe0724]

We need a good business man to draft something to get us out of this mess

Or woman =)

[banca rotta]

Good. We need fresh blood in Congress.

In just over a month we should all vote out every incumbent regardless of party lines just for the purpose of getting the message across.

It won't happen but it will be nice to see it.