Personally, I'm Glad the "Bail Out" Failed.
By ParaTed2k
@ParaTed2k (22940)
Sheboygan, Wisconsin
September 30, 2008 1:38am CST
Here are the only "fixes" we need...
Dissolve all "hybrid" (part government, part private) companies:
Remove government mandates to banks and loan companies for high risk loans. Let those who loan the money decide what is and isn't an acceptable risk. Let them reap the rewards but make them accept the responsibilities.
Ban the selling of loans to 3rd parties. This practice has always made me mad. It totally destroys my right to decide who I will and won't do business with.
In other words, allow the free market to do its job.
btw, yes, taking these steps will lead to a downturn in the economy, maybe even a pretty bad one, but it is our unreasonable fear of downturns that has lead to this problem in the first place.
2 people like this
10 responses
@ngaspero (851)
• Italy
30 Sep 08
You are glad but, what is going to happen now? the crisis is very bad and noone should forget what happen in 1929, if a conservative and "free market" government like is the GWB one,plan somethink like that it means that the situation is really dramatic and can cost more thes this 700 billion (that are a monster amount of money)..the situation is not good at all
Nun
2 people like this
@ParaTed2k (22940)
• Sheboygan, Wisconsin
30 Sep 08
The situation isn't good, and I'm not saying I don't want them to do anythign at all, but this bill was bad all the way around.
Also, it is healthy for the economy to have downturns every now and then.
@ngaspero (851)
• Italy
30 Sep 08
about down turns I agree with you but, now the risk is that this is a collaps, when the bank start to crash is always a very bad sign, but really bad..and if every thing go down the cost will be much more then 700 billion...but really much more..
Nun
1 person likes this
@ParaTed2k (22940)
• Sheboygan, Wisconsin
30 Sep 08
Sometimes it helps to leave things to work themselves out. The crash of 29 would have led to a much lighter depressin if the government didn't try to "fix" things. They took what should have been a few years and made it into "the great depression".
@Citizen_Stuart (2016)
•
30 Sep 08
I'm with you on most of that, although I think buying and selling debts is legitimate. The root cause of the current crisis is governments and central banks pumping too much credit into the system in the first place, combined with a belief in the banking industry that Nanny State will prop them up if there are problems. Giving money to banks to help them with their debt problems is just going to encourage them to continue to act irresponsibly. Better to let a couple of banks go to the wall and hope that the others will realise that they're responsible for solving their own problems (just like any other business). Recession is inevitable now, and it's probably going to be a really bad one, but more government intervention is just going to make things worse.
@ParaTed2k (22940)
• Sheboygan, Wisconsin
30 Sep 08
I disagree with the selling of loans being "legitimate". Why should I be forced to do business with thieves and shysters? Banks want to decide who they do business with, well, I have that same right. It should be banned!
1 person likes this
@chameleonsdream (1230)
• United States
30 Sep 08
So regulations on free trade are okay as long as they're regulations that you like? Don't get me wrong - I completely agree that the buying and selling of debt should be banned. That really is the root of it all - the moment you divorce the ability to profit from an asset from its risk, there's no reason for a bank to care whether the people it lends to can afford to pay the loans back. Once there was a major market for mortgage backed securities, and banks could get their money back UP FRONT before the lenders paid it back, all bets were off. It happens in any industry when the demand far outstrips the supply - not enough mortgages? Write more so we can make more money. Not enough buyers? Find me more, I don't care where. I have an order for more mortgages! This was not a problem of the Feds forcing banks to make unsound mortgages - this was pure greed at work in a system with little oversight and no accountability.
2 people like this
@chameleonsdream (1230)
• United States
30 Sep 08
Bah - what I get for writing at 3 in the morning - I meant before the borrowers pay it back, of course.
1 person likes this
@Ravenladyj (22902)
• United States
30 Sep 08
i'm not big on politics, news etc etc so I'm not exactly sure what thats all about....Could one of you fill me in on it AND why it failed?? In simple terms or I'll get bored LOL..
@xParanoiax (6987)
• United States
1 Oct 08
I'll step in Raven, I'll put aside my misgivings about the fine print consequences and all and put it in laymens:
The bail out bill was a bill that proposed to give an unelected official (Paulson, sec of the treasury) the power to bail out any bank, corporation, foreign or domestic with taxpayer money, without oversight in order to "fix the economy".
Now by time they voted on it stuff was added onto it and all...but it failed despite the odds. They tried to stack things in favor of it, but see people protested nation wide and flooded their representatives inboxes, the phones, the radio...everywhere they turned they were smacked with one message from the people; "DON'T YOU DARE VOTE YES!"
Since we're close to election season for representatives, they're afraid of losing their jobs. Some of them really did vote "no" on moral and practical grounds, but most of them were afraid for their cushy jobs in Congress lol.
Did I do it OK? *worried face* I read alot of politics and I'm so used to legalese at this point I can't tell sometimes 
lmao.
lmao.
@ParaTed2k (22940)
• Sheboygan, Wisconsin
1 Oct 08
Yes, it will be reconsidered, repackaged and edited. There will be a bill passed, the only question is how much crap that doesn't belong there will survive.
@xParanoiax (6987)
• United States
30 Sep 08
The way I see it now, is either way we were screwed. By picking the not-screwing-ourselves option, we have that as the costs of all the crap that's built over time spews all over the place.
I'm glad it failed as well.
I do hope that the government doesn't give up trying to figure out ways to help us and all, but they need something better than a blank check.
See, crises can act sortof like a reset button. Although, more painful than just a button'd be. At the end of the ripples they set off, things are usually better off than they would've been otherwise. The problem, of course, is living through the ripples...and boy they can be quite some doozies.
They cost us. It should cost them everything they have for costing us so much...and they should consider that a form of mercy.
With things like they are, as things get worse, at least this way the ball's back in our court. We'll have all the control over the economy, since big business and global business will falter, sputter, and wither...it'll be back to local...and this is probably the best thing everyone could ask for...in a crisis. To have control of the circumstances relating directly to them.
I'm not even saying that this part will be fun. I'm just saying when put in perspective...it's better than being left to survive with your own helplessness like during the Last Depression. It's just this will hurt more than then, because...these are the times we live in.
1 person likes this
@ngaspero (851)
• Italy
30 Sep 08
You are glad but, what is going to happen now? the crisis is very bad and noone should forget what happen in 1929, if a conservative and "free market" government like is the GWB one,plan something like that it means that the situation is really dramatic and can cost more thes this 700 billion (that are a monster amount of money)..the situation is not good at all
Nun
1 person likes this
@redyellowblackdog (10629)
• United States
30 Sep 08
The steps you advocate would only lead to short term decline in the economy, if there was any decline at all. Your recommendations would lead to an overall stronger economy in the long term.
@bobmnu (8157)
• United States
30 Sep 08
We should reward those who take the risk and assume the responsibility. The Free Market is the best regulator we have if we just let it alone. The Government is trying to do social engineering with their formation of Fanny Mae and Freddie Mac with someone else's money.
@irishidid (8687)
• United States
30 Sep 08
Good points. The selling of loans is what got us into quite a bit of this problem.
http://www.youtube.com/watch?v=TxgSubmiGt8
@ParaTed2k (22940)
• Sheboygan, Wisconsin
30 Sep 08
Exactly. There is nothing ethical, honest or legitimate about it.
@kenzie45230 (3560)
• United States
1 Oct 08
Companies and individuals have become so used to Uncle Sam bailing them out for everything that there is really no incentive to succeed. What I cannot believe are the top execs who get bonuses regardless. That makes no sense. Bonuses should be paid for sucesses, not failures.
