http://money.cnn.com/2008/03/11/news/econo...sion=2008031115 Does anyone else find this disturbing? To me, its saying go ahead and be greedy and/or incompetent will be here to rescue you. If Wall St makes alleged "can't lose" securities out of sub-prime loans then they get what they deserve The scariest words in the English language are and always have been, "We're from the government & we're here to help." Continually pumping money into the system is what got Germany into trouble in the 1920's & 30's.
google or wikipedia Northern Rock crisis and you will find something even worse. $200m? Try £26bn ($50bn)
I do recall hearing about Northern Rock & if memory serves Britain had to nationalize that bank. Hopefully, we are not getting to the point where there are so few big companies that the gov't has to nationalize them in order to bail them out. That is scary indeed & makes us no better the Hugo Chavez.
While we're still light-years better than Chavez, I'm not so thrilled with subsidizing Wall Street. It's a speculative industry for crying out loud!
<div class='quotetop'>QUOTE (AEM)</div><div class='quotemain'>I'm not so thrilled with subsidizing Wall Street. It's a speculative industry for crying out loud!</div> You, at least, have a chance in Vega$, the house always wins on Wall St.
“The goose that lays golden eggs has been considered a most valuable possession. But even more profitable is the privilege of taking the golden eggs laid by somebody else’s goose. The investment bankers and their associates now enjoy that privilege. They control the people through the people’s own money…. The fetters which bind the people are forged from the people’s own gold.” US Supreme Court Justice Louis D Brandeis The Works of Justice Brandeis Solomon Goldman, ed. Foreword by Justice William O. Douglas Henry Schuman New York 1953 At pp. 146-47
I hate to spam my own message board, but I've written quite a bit on my blog about what I think is going on. While this doesn't quite qualify as a bailout yet (it is a potential bailout, however), and thus pretty unpalatable, the potential alternatives aren't very good either. In a nutshell, there's a pretty strong case to be made that this falls into the legitimate role of the government as the "lender of last resort". I'm a big believer in the free market. I'd even point out that the makings of the current mess have the fingerprints of the government all over them (via years of pressuring the lending industry to take on risky customers and in creating a variety of reporting loopholes that allow financial companies to set up things like debt-hiding SPVs -especially passing them off as AAA bonds). But the bottom line is you can't treat an entire industry- and a key one- the way you'd treat an individual company. You don't bail out a bank if it made speculative decisions and got burned. But if the entire banking industry is in the same sort of position, you're going to have serious consequences if you let em go belly up.
<div class='quotetop'>QUOTE (AEM @ Mar 11 2008, 10:02 PM) <{POST_SNAPBACK}></div><div class='quotemain'>“The goose that lays golden eggs has been considered a most valuable possession. But even more profitable is the privilege of taking the golden eggs laid by somebody else’s goose. The investment bankers and their associates now enjoy that privilege. They control the people through the people’s own money…. The fetters which bind the people are forged from the people’s own gold.” US Supreme Court Justice Louis D Brandeis The Works of Justice Brandeis Solomon Goldman, ed. Foreword by Justice William O. Douglas Henry Schuman New York 1953 At pp. 146-47 </div> That is a great quote. It reminds me of something attributed to Jesse James. "Its easier to own a bank than to rob one."
<div class='quotetop'>QUOTE (MikeDC @ Mar 11 2008, 10:01 PM) <{POST_SNAPBACK}></div><div class='quotemain'> I hate to spam my own message board, but I've written quite a bit on my blog about what I think is going on. While this doesn't quite qualify as a bailout yet (it is a potential bailout, however), and thus pretty unpalatable, the potential alternatives aren't very good either. In a nutshell, there's a pretty strong case to be made that this falls into the legitimate role of the government as the "lender of last resort". I'm a big believer in the free market. I'd even point out that the makings of the current mess have the fingerprints of the government all over them (via years of pressuring the lending industry to take on risky customers and in creating a variety of reporting loopholes that allow financial companies to set up things like debt-hiding SPVs -especially passing them off as AAA bonds). But the bottom line is you can't treat an entire industry- and a key one- the way you'd treat an individual company. You don't bail out a bank if it made speculative decisions and got burned. But if the entire banking industry is in the same sort of position, you're going to have serious consequences if you let em go belly up. </div> Promoting your blog is highly encouraged
Fed & Chase bailout Bear Stearns I'm certain Jim Cramer of CNBC doesn't think too highly of Bear Stearns. Personally, I have no qualms about Chase helping out.... could it a Merger/acquisition? The Fed saves the day again? lol? Once is a coincedence twice is not.
A bailout I think may work Why did the government not do this earlier? I'll save the soapbox for Fox Mulder. Though, I wonder if its a case of shutting the barndoor after the horses have left? http://articles.moneycentral.msn.com/Inves...yTheirDebt.aspx Did you know 61% of people in 2006 who got subprime loans qualified for "normal" loans?
