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October 3, 2008
No Bailout!
As usual, they never tell you why the US$700 billion bailout stinks. And why millions of American citizens are against it. The simple truth is that cash has already been pumped into the system and it hasn’t worked. There is no reason to imagine that this would work.
From: http://bigozine2.com/feature/
They are going to cram this one down your throats!
Comments
I will give it to you that most commentators from Krugman to others on the right side of the political spectrum say this bill sucks. But they all say that it is worse to do nothing. So what else would you suggest What?
Posted by: wasder at October 3, 2008 11:42 AM
Funny how all the uproar and calls to Congressman had all been 90% against up until the point of last weeks House vote. And then, when it didn't happen and the market plunged 777 points the tide changed and the calls all shifted to "What the hell did you do to the market and look at my 401k and do something to fix this!!!!!!!" They actually jammed the servers and the phone lines when the market was falling!!!
As ana aside I wish the market had fallen 666 points so we could see all the drivel coming out of the satanists, the religious right and the evangelicals. That really would have been fun.
Posted by: daveinbedstuy at October 3, 2008 11:47 AM
"So what else would you suggest What?"
It's not about money, it's about trust. As I posted last night LIBOR rates has skyrocketed to the moon! Banks are unsure about the valuation of those assets on their books. They want to stick the taxpayer with the bill and if this goes down, our borrowing cost will go to the moon..
I think it get passed to day and the market will go higher. Very soon we will be in a crash scenario and we will be out of bullets.
The What
Someday this war is gonna end...
Posted by: what at October 3, 2008 11:51 AM
"Funny how all the uproar and calls to Congressman had all been 90% against up until the point of last weeks House vote. And then, when it didn't happen and the market plunged 777 points the tide changed and the calls all shifted to "What the hell did you do to the market and look at my 401k and do something to fix this!!!!!!!""
Thanks Dave, I like to address this. The 7777 point plunge was a scare tactic that work on some people. Most Americans have no idea what going but what they are told thru the media. Plenty of people still DO NOT want this bail out. What happen if we pass this bill and the market tanks 20% in one day Dave. That 700 billion could've been used for the people of this country for service and not to bail out Wall Street interest.
People have to realize that this the unfolding of the Mutant Asset Bubble and throwing money at the problem wont solve it. It's not a money problem, it's a trust problem.
The What
Someday this war is gonna end...
Posted by: what at October 3, 2008 11:59 AM
Borrowing costs to the moon? Naa, they'll just return to historic levels...plus a bit.
When in history could you borrow money for nothing with nothing?
Posted by: moreteasir at October 3, 2008 12:02 PM
I really don't understand the bailout AT ALL, but what I do see is a Congress ready, willing, and able to spend $700 billion to bail out Wall Street firms from their stupid bets on bad loans, when it can't spend $.07 to bail out some poor family from crushing medical debt. Typical.
I'm pretty convinced, however, that something needs to be done. I just can't say what. What I need to know is, what could happen to the economy if nothing is done. Explain to me how the credit crisis is going to affect me directly. Because so far, it hasn't, other than Congress's vote eating into the balance of my 401K.
Posted by: BrooklynButler at October 3, 2008 12:39 PM
I agree with What that this is a trust problem. A monstrous crisis of faith. (The Spiegel article yesterday was, as the person that sent it to us said...uhm, "sobering".)
My main concern with this bail out is as What says - where do we go if it doesn't restore the faith, what if there is a crash, and where do we go from there? There doesn't seem to be any long range deep thinking on this. It feels like a big fat band-aid. But what do I know - I'm not an economist or a financial whiz kid.
Are we putting all our eggs (or at least a whole #%@&-load of eggs) in a dubious basket?
Can anyone make sense of/explain to me the add-ons they're considering?
Posted by: cobblehiller at October 3, 2008 1:12 PM
"Can anyone make sense of/explain to me the add-ons they're considering?"
Free tube of lube for every taxpayer.
" - where do we go if it doesn't restore the faith, what if there is a crash, and where do we go from there?"
It's not about "restoring faith", it's about bailing out the The Big Boys! Why does the large hedge funds, Warren Buffet or Bill Gross (PIMCO) buy some of this crap. Why you ask? Because they know it's all Ka- Ka! Now I hope they do pass this bill because people will find out what Unintended Consequences is.
Welcome to the Great Depression 2......
The What
Someday this war is gonna end...
Posted by: what at October 3, 2008 1:24 PM
Hey Dave! They passed the first part of the bill. At that time the Dow was up 287 point and now the sell off is coming! from the pop the market is off 190 points. Ha ha we see the "benefits' of this bail out. I hope the GOD that they rape everything in sight because the asshats are not getting it! This is the biggest Rip-Off in American history. Sell the news LMMFAO, SUCKERs!!!!!
The What
Someday this war is gonna end...
Posted by: what at October 3, 2008 1:37 PM
cobblehiller--all good questions. For myself I would rather them try something than see what happens if they do nothing. I must say I prefer this sort of analysis from the What and others that puts the blame on the mismanagement of the financial institutions rather than on homeowners like us. Thanks What for making a constructive conversation.
Posted by: wasder at October 3, 2008 1:46 PM
If this market goes in the red, we may have the scariest Monday ever. Thank goodness I have all monies in cash. Unless of course, we cut rates and Europe and UK do to. If we go thru 10400 I think 9800 is the next stop unless rates are cut all around but this may not stop this deflationary spiral. Wow I may wind up buying that Brooklyn Heights house for 500 k cash after all. What do you guys think? If we keep going down all past technicals have been broken and PEOPLE are in deep shit..
Posted by: HOBOKENROCKS at October 3, 2008 1:47 PM
If this market goes in the red, we may have the scariest Monday ever. Thank goodness I have all monies in cash. Unless of course, we cut rates and Europe and UK do to. If we go thru 10400 I think 9800 is the next stop unless rates are cut all around but this may not stop this deflationary spiral. Wow I may wind up buying that Brooklyn Heights house for 500 k cash after all. What do you guys think? If we keep going down all past technicals have been broken and PEOPLE are in deep shit..
Posted by: HOBOKENROCKS at October 3, 2008 1:47 PM
Hey What, I have been thinking about what Buffet and Pimco are doing and my cynicism runs deep.
Did you read the Spiegel article?
I admire your ability to maintain the righteous outrage and fury. It takes commitment. I, for one, appreciate hearing what you have to say. I hope you might reconsider coming to the Union Hall event. (Code for: Help! Please don't leave me alone with Biff and Dave!)
Posted by: cobblehiller at October 3, 2008 1:53 PM
"I hope the GOD that they rape everything in sight because the asshats are not getting it!"
Whoops--here I thought we were being all constructive here. Oh well its still the What. It wouldn't be the same without a little anal rape.
Posted by: wasder at October 3, 2008 1:54 PM
I avoid these discussions, I'm not that well versed in the economy.
But I have to say, with major regret, that this is my favorite line so far today.
'Free tube of lube for every taxpayer.'
Posted by: bayridgegirl at October 3, 2008 1:55 PM
cobblehiller--I will be there too. Don't know if that is a welcome thought to you or not but I hope it is. I think that you are a good, level-headed thinker and I would hope that you think the same of me. In re righteous outrage, if I understood a little better where the righteous outrage was directed I might be more sympathetic to his/her point of view. I myself share a lot of anger at the way the country's economy was run into the ground, despite any number of warning signs and chances to put the brakes on. But somehow, because I purchased a house, in the What's analysis I am the enemy.
Posted by: wasder at October 3, 2008 2:04 PM
Dow's up 53.44 at the moment - so much for euphoria.
Posted by: bridges at October 3, 2008 2:05 PM
Wasder, What enjoys a little ass rape after lunch. He's eclectic.....or a republican.
Posted by: moreteasir at October 3, 2008 2:09 PM
"I hope you might reconsider coming to the Union Hall event. "
Naw but have fun!
"But somehow, because I purchased a house, in the What's analysis I am the enemy."
No Wasder, your thinking is the enemy.. Your belief in the Mutant Real Estate Bubble is what got me sick. There is no rush to ruin you financial future.
The What
Someday this war is gonna end...
Posted by: what at October 3, 2008 2:15 PM
hey wasder, Thanks, I'm confused, and I read and read, and still don't seem to have the grey cells to wrap my mind around what is happening or how they're going to fix it, anyway. And I do not trust this circus going on down in Washington.
I'm fighting the urge to crawl under my bed. For some reason the Talking Heads Life during Wartime lyrics are playing in my head right now.
Posted by: cobblehiller at October 3, 2008 2:19 PM
"No Wasder, your thinking is the enemy.. Your belief in the Mutant Real Estate Bubble is what got me sick. There is no rush to ruin you financial future."
OK--now we are getting somewhere. Thanks for your response. I did not purchase a home because with "belief" in the MREB in mind. I purchased a home because the circumstances of my life dictated to me that I do so. It was a judgment call obviously and one that I thought over a lot (as judged by the many pages of agonized writing I have produced on the subject since--sorry everyone!). I bought the cheapest house that I could imagine myself living in that fell within the borders of Clinton Hill and I talked the price down 200G before I bought. So I certainly didn't walk wide-eyed into the buzzsaw. At the same time as I have said repeatedly, I have no doubts that it will experience some form of devaluation over the next year/s.
So this is all short hand for saying if you are trying to put some nefarious real estate scam on me, you got the wrong guy.
Posted by: wasder at October 3, 2008 2:22 PM
Thanks What, I'll just secretly keep hoping that you show up under some other "nom de plume" and come over and shake my hand!
Not at all, wasder, looking forward to meeting you. And thank you for the compliment. Not sure it's true, but thank you just the same! You won't ditch me in a conversation with Biff and Dave, will you? I'll track you down and egg your house if you do!
Posted by: cobblehiller at October 3, 2008 2:27 PM
cobblehiller--I have been cramming on this stuff too. I just don't want to bet on what happens when businesses can't get credit (as a small business owner myself this would be a highly problematic situation). I am hoping with all of my being (and donating money to help the cause) that Obama wins and there is still some influence his administration could have on this situation. The main goal as I see with the bailout is for it to keep the markets afloat until a real, well thought out proposal can be put into place by a newly ascendant Democratic administration. Fingers, toes, and anything else that can cross, crossed.
Posted by: wasder at October 3, 2008 2:27 PM
"You won't ditch me in a conversation with Biff and Dave, will you?"
I actually bet you would enjoy a conversation with these two. They are funny and nice men. But either way, I am sure there will be lots of folks to talk to. Please don't egg my house!
Posted by: wasder at October 3, 2008 2:31 PM
I heard that the bailout has a provision that allows bad foreign assets to be purchased and that Paulson demanded that any effort to omit this provision be veto'd. Are we being extorted by other countries to buy up their bad bets?
Also, didn't Ben Bernanke already pump $630B of liquidity in the markets after Monday's rejection? What did it do? Now The Terminator of California wants $7B from Paulson to pay for cops and teachers, etc. Where does it end?
Posted by: DOW8000SP800 at October 3, 2008 2:37 PM
"Are we being extorted by other countries to buy up their bad bets?"
Yes. So next time Wall Street cooks up some new dubious product, foreign markets will once again gobble them up, knowing that US Taxpayers will foot the bill when they blow up.
Posted by: SnarkSlope at October 3, 2008 2:51 PM
wasder, I will not egg your house! Sorry, I was just teasing you! I have a warped sense of humor! I'm sure everyone will be very nice.
"The main goal as I see with the bailout is for it to keep the markets afloat until a real, well thought out proposal can be put into place by a newly ascendant Democratic administration. Fingers, toes, and anything else that can cross, crossed."
I totally agree with you here. I'm firmly in Obama's court. But where is this plan - I'm hoping for it too - going to come from? Our House and Senate are running around like their pants are on fire, and I don't see much leadership in the offing. Ok, well, maybe Dodd - he seems to be the defacto President at the moment. And I don't hear much about a long range plan. Who/Where are the smarties that are going to be the voice of reason and pull us out of this?
I hear you DOW, yes we are, see Der Spiegel article. Merkel is none too happy with us. They/we have to buy back the crap that the little cities in Gemany bought with their municipal monies.
I see no end to it. I wish I did.
Posted by: cobblehiller at October 3, 2008 2:52 PM
Miserable sons of bitches have keep Sec. 112 the same too: "...To the extent that such foreign financial authorities or banks hold troubled assets as a result of extending financing to financial institutions that have failed or defaulted on such financing, such troubled assets qualify for purchase under secion 101."
Posted by: bridges at October 3, 2008 2:52 PM
The house always wins.
You guys sound just as smart as I do after I leave the Borgata.
It ends at zero Dow....unless the pit boss or Paulson advances you that marker. After that, is ass rape time...uh, that's what I've been told at least.
Posted by: moreteasir at October 3, 2008 2:52 PM
"Yes. So next time Wall Street cooks up some new dubious product..."
You are so right on. This is a huge fear of mine Snark, so say we fix this mess - what's to stop the, I'll say it, asshats from inventing some new thing? Think junk bonds, dot.com, this disaster...what's the next thing going to be? The weasels will just work their "money making magic" and find more loop holes and finagle some other previously unthinkable thing. When does this stop?
Posted by: cobblehiller at October 3, 2008 2:58 PM
Didn't think you were actually going to egg my house. Clearly the plan is not going to happen in the midst of the power vacuum that is occupying the federal government during the election season. This is why I am hoping that the bill passed today will help them limp through January. Then yes, somebody like Chris Dodd will be appointed by Obama to craft long-term legislation that is not a panic reaction but instead a balanced, measured approach that protects home-owners and provides a role for the Federal Government in responsibly regulating these complex financial transactions. Here's hoping.
Posted by: wasder at October 3, 2008 3:07 PM
Despite what the oundits tell you here the truth is no one really knows whether or not the "bailout" or "rescue plan" (depending on what day it is) will actualy work and restore confidence to the marketplace. We're all just going to have to wait and see.
Funniest line of the day: "(Code for: Help! Please don't leave me alone with Biff and Dave!)"
Posted by: East New York at October 3, 2008 3:10 PM
"Then yes, somebody like Chris Dodd will be appointed by Obama to craft long-term legislation that is not a panic reaction but instead a balanced, measured approach that protects home-owners and provides a role for the Federal Government in responsibly regulating these complex financial transactions. Here's hoping."
Chris Dodd is Banking bitch. I hope to GOD he never gets near a cabinet post!
"Despite what the oundits tell you here the truth is no one really knows whether or not the "bailout" or "rescue plan" (depending on what day it is) will actualy work and restore confidence to the marketplace. "
This is not about "restoring confidence", it's about passing the loses on the Taxslave. Look at the market as soon the bill was passed, the market sold off immediately!
We are in CODE RED!!!!
The What
Someday this war is gonna end..
Posted by: what at October 3, 2008 3:23 PM
Chris Dodd, balanced and measured? He was Countrywide's whore.
He's a total pro.
Posted by: buttermilk channel at October 3, 2008 3:45 PM
The bill is too small to work. I have written this before and now the market is reacting to it. The DOW broke 10400 and now I believe 9800 is the next resistance.Wheter we go down that low depends on what the fed,ecb and BOE do this weekend. We will need at least 1 trillion dollars more to bring back liquidity to the markets. Also interest rates cuts around the world and then tax cuts which will reflate this country and others. Then the next and greatest bubble will burst. That huge deficit our country has. Gold may go down short term but if what I say occurs , gold will come back and roar.
Posted by: HOBOKENROCKS at October 3, 2008 3:54 PM
"I heard that the bailout has a provision that allows bad foreign assets to be purchased and that Paulson demanded that any effort to omit this provision be veto'd."
No, the provision is to allow us to purchase bad American assets from foreign banks, like UBS, for example. The original called for letting only American banks in on the gravy. Then several of the foreign banks complained, while pointing out that they have several thousand employees in NYC that pay taxes.
Posted by: denton at October 3, 2008 4:01 PM
Hoboken, the 700B is only a limit in that it is the maximum that Paulson can demand at one time. I'm sure another trillion will be pumped into the system this month, why not?
Posted by: bridges at October 3, 2008 4:06 PM
OK--so maybe not Chris Dodd. I said somebody like that, meaning an intelligent person connected to a Democratic Administration. Open to suggestions...any other names come to mind for this role?
Posted by: wasder at October 3, 2008 4:22 PM
1 trillion will have to be pumped in just to make things ok. We have a serious Deflating spiral going on and the only thing in my opinion that stops it is huge capital gains tax cuts which would put a floor on the stock market...
Posted by: HOBOKENROCKS at October 3, 2008 4:23 PM
Roubini, Chris Rock and Lewis Black come to mind.
Posted by: buttermilk channel at October 3, 2008 4:32 PM
CODE RED IS RIGHT, if the fed, ecb and boe don't act , I believe THAT the probability of a great market crash on Monday is better than 50 percent.
Posted by: HOBOKENROCKS at October 3, 2008 4:32 PM
"(Code for: Help! Please don't leave me alone with Biff and Dave!)"
Cobblehiller, feel free to not show up. Nobody's forcing you. But if you do, don't worry about being left alone with me and Dave; we have much more interesting people to talk to than you.
Posted by: Biff Champion at October 3, 2008 5:30 PM
Biff, Oh dear, I'm sorry, you sound upset at my comment. I apologize. It was meant to be funny. ENY thought it was funny. But I guess you didn't. I didn't mean for it to be hurtful or unkind. I thought it was kind of silly really. I don't go places where I don't want to talk to people. I want to meet everyone.
I thought it would make What laugh. I didn't mean to upset you, or say it to be nasty. I'm not a nasty person.
I will be more than happy to talk to you and Dave. Again, I apologize, and I will be very happy to meet you and Dave if you'll say hello.
Posted by: cobblehiller at October 3, 2008 5:45 PM
Say "Please?" cobblehiller, LOL
Posted by: daveinbedstuy at October 3, 2008 6:10 PM
ha ha ha Dave. Ok, Mr. Snarky - yuck it up - this one's on me.
Cripes, I'll be lucky to get of Union Hall alive if I do show up! I'm starting to think I better bring my better half for protection!
Posted by: cobblehiller at October 3, 2008 6:34 PM
HOBOKEN: Look up from your charts. Charting sometimes makes sense under more normal market conditions. If you keep trusting your money to charts you are going to either lose your shirt or lose out big on the rebound.
I smell capitulation. Tear up your charts and get a good whiff of it.
Posted by: lechacal at October 4, 2008 10:58 AM
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