Take for instance the three page Bush/Paulson plan that gives one person the authority to distribute $700 billion dollars to buy toxic debt, OR take the one-page Republican House Plan designed to force Wall Street to “work out” its own pain by offering Treasury-backed insurance, more tax cuts and deregulation. Either one stinks and they don’t smell any better putting them together. In the end, that’s what it all amounts to.
In some ways, Democrats were forced into the negotiator's role by house republicans who suddenly turned on their president of 7½ years. It’s an election year. After all the stagecraft, the final “bail out” plan is over a hundred pages long but now referred to as a “buy in” plan. The insurance plan pushed by house republicans will be under “consideration” and Pelosi says the party on Wall Street is over. Whatever that means. But the $700 billion is still there to buy junk assets, only spread out over time. In the end, I don’t see how this plan will fix our broken “debt-based” monetary system, but the money should make someone happy.
After Warren Buffet gambles $5 billion on Goldman Sachs that Congress will flood Wall Street with $700 billion, he warns Congress that if they don’t act it will be the “biggest financial meltdown in American history.”
What's in it for homeowners? Not much.
6 comments:
Bush said that the 700B bailout can not help economy
http://youtube.com/watch?v=u3BkNBKfqAE or here: http://tubedirect.net/index.php?q=Eminem-interview
So you think that this is, in fact, just a flimsy band-aid where a full plaster-cast is required? A $700 billion band-aid!! Takes your breathe away. This whole business has really demonstrated how rickety the financial system is. How long do you suppose it'll be before people forget that, and return to more relaxed spending habits? Sounds like that's the solution everyone's waiting for. This could be the uber chicken and egg situation. Not so?
Absolutely. We know there's a problem - and a big one. But throwing money at it, in just one sector (junk mortgage assets) of this vast economic engine - even if it's 700B - with some oversight provisions - is not going to fix the problem. They'll feed it, lower interest rates, induce inflation, tinker around the edges and it will start all over again. America's biggest export is debt, 11 trillion dollars worth. A major adjustment is in order. It's coming....it's only a matter of when.
And until the "adjustment" (a modern day revolution, possibly?) how will the 700B be paid for, do you suppose? I mean in day to day life. Subtle raises in taxes? Interest rates with a slight sqeeze of lemon (make your eyes water only slightly)? You think?
The sudden urgency in this fix is remininscent to the run-up of the Iraq War. Not enough time to work from the facts.
We know tax cuts won't pay for it. They'll find a buyer for the 700B just like they found a buyer for the previous $10 trillion. Instead of raising money to pay down our debt by buying it back, Congress continues on with the global stakeholder scheme. But will the world market be too big to fail? It's too big for me to wrap my head around but that is probably the bottom line.
If anything, passing this bill is an acknowledgment it's time to bail out all of the failures of the past eight years.
The idea that the free markets are smart and can take care of themselves should have been left to demonstrate and prove itself. Instead, they ran to the "dumb" government. In the end, government will be blamed for the free markets failings.
Three pages from Bush, one page from house republicans. The remaining 100 pages came from the democrats?
But you're right, it's not like they've been working on this thing for 3 or 4 months.
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