New Bill to be Voted on

[Diekan]

EXCELLENT NEWS.

New vote. Pre-market is up. Should carry over at 9:30 and well into the day. The only issue is they're not planning on voting until after the closing bell today. Seems they liked *my* idea of raising the insurance of "savings" accounts from 100,000. Also, the bill will include some tax cuts for the middle class.

[Evermore]

raising the FDIC coverate is useless. its just a smoke screen to get more senators to vote. btw I thought bills like this were mandated to come from the house, and Pelosi is already griping about this bill...

[Diekan]

http://www.forbes.com/feeds/ap/2008/09/ ... 91799.html

[Martrae]

This is horrible news. It's unconstitutional, it's immoral and it won't work.

[Diekan]

Unconsitutional? Really, Mart... you need to stop listening to Boortz. Yeah, I'm a libertarian too - but some times he is just off the charts.

I opposed bailing out the airlines. I am opposed to bailing out the auto industry. I would be opposed to bailing out someone like say... Coca Cola. But, again, as I have stated several times - banks are a completely different matter.

I think you're an intelligent person, but I don't believe you really understand the gravity of this situation or the implications of a complete collapse of our banking/credit system. I HOPE that you are not one of "those" people are raising hell because you're afraid some CEO might get a "golden parachute." -- there's a hell of a LOT more to it than that.

Have you actually looking into this bill or are you just following along with what Talk Radio / Blogs are telling you? Seriously... I'm not meaning to attack you - I am curious if you've taken the time to research it.

[Eziekial]

I've been reading the compromise bailout bill that was voted down and it's a blank $700 Billion check to the Secretary of the Treasury to do with as he sees fit.

[Tossica]

I say let the crooked fuckers fold. This is "capitalism" at it's finest. They took a risk and lost their asses. Let them fold and in no time others will step in to take their places. Yes, things will get worse before they get better but as long as there are people willing to borrow money and pay interest, there will be institutions lined up to loan that money. It's been that way as long as currency has been in use.

[Tuggan]

I opposed bailing out the airlines. I am opposed to bailing out the auto industry. I would be opposed to bailing out someone like say... Coca Cola. But, again, as I have stated several times - banks are a completely different matter.

So bailouts are all good so long as they keep your wallet nice and fat? and no, I didn't ignore the rest of your post. In my opinion a bailout is a bailout.

[Evermore]

diek do you really think the us has enough cash to cover that?

and I dont mean the kind they print up like its going out of style.

[Diekan]

Tossica,

What you're forgetting is that while yes they made risky loans, they were pushed by the government (see CRA act back in 1995) to do so.

It'd be like you trying to sell your music and me stepping in making you sell (on credit) to people you know can't or won't pay for it in the end - then holding you solely responsible for your businesses collapse. Something like that.

Not saying the banks aren't also to blame - their hands are dirty too - but this isn't JUST the result of out of control banks.

Obama gave a GOOD speech on why we need this bill. It's on Fox News right now.

[Martrae]

Unconsitutional? Really, Mart... you need to stop listening to Boortz. Yeah, I'm a libertarian too - but some times he is just off the charts.

I opposed bailing out the airlines. I am opposed to bailing out the auto industry. I would be opposed to bailing out someone like say... Coca Cola. But, again, as I have stated several times - banks are a completely different matter.

I think you're an intelligent person, but I don't believe you really understand the gravity of this situation or the implications of a complete collapse of our banking/credit system. I HOPE that you are not one of "those" people are raising hell because you're afraid some CEO might get a "golden parachute." -- there's a hell of a LOT more to it than that.

Have you actually looking into this bill or are you just following along with what Talk Radio / Blogs are telling you? Seriously... I'm not meaning to attack you - I am curious if you've taken the time to research it.

I haven't listened to Boortz in years. I do still very infrequently check out his website, though. Perhaps once every couple months (yesterday was the first time since maybe June).

If you had bothered to read any of my many posts about this you'd know I have done a LOT of research about this.

Is it constitutional for the government to be in the business of buying and selling these assets? Is it constitutional for all control over these assets to be handed over to a man hand-picked by the President do be bought and sold at his (and HIS hand-picked committee's) sole discretion? Is it constitutional for the government to take money from taxpayers and use it to pay the debts of a private corporation?

Do you know how they'll come up with this $700b? The Treasury will issue bonds which the Federal Reserve will buy. How can the Federal Reserve buy these bonds? They just print up more money. If you can't see the impact of having $700b brand new bills hit the streets then there's no hope for you.

And these toxic debts that are supposedly going to be sold for a profit? Will only happen if they hold prices artificially high, which is what prolonged the depression.

[Tossica]

Tossica,

What you're forgetting is that while yes they made risky loans, they were pushed by the government (see CRA act back in 1995) to do so.

This is BULLSHIT. That's what they want you to believe now that they have been caught with their hand in the cookie jar. Noone forced them to take on these high risk mortgages and the poor people who are in modest homes in shitty neighborhoods are NOT the ones causing this shitstorm. It's the middle class that had to take out second mortgages or refinance in to ARMS and interest only loans to make ends meet that are getting forclosed on right now.

[Arlos]

And a lot of it is companies that pushed loans to people far outside the boundaries of any sane envelope of risk, strictly for short term profit. Nothing in those changes in 95 prevented loan originators form even checking if someone asking for a loan had an income or not, correct? Yet in 05 and 06, etc. tons of loans were being made to people who did not! Nothing in those 95 changes forbade loan companies from actually, you know, verifying information people put on their loan applications, right? Yet why were so many loans approved for people who baldly lied on their applications with no back checking ever done? You still claiming that either of those things has anything to do with those changes in 95?

Hell, if the 95 changes were to blame, why exactly did it take 12+ years for the problem to hit, hmmm? The biggest defaults have happened on those variable rate mortgages, that jump in interest rate after 2 years, which means those loans were made in 04-06, a DECADE after the changes in 95. Oh yeah, I see a direct causal effect, suuuuuure.

No, the source of the problem was the explosion in trading of derivatives that there was no oversight on or regulation of. This was combined with bonus structures that rewarded people who sold loans to anyone and everyone, and the greed of many Wall Street firms that allowed themselves to become insanely leveraged because it allowed them to generate massive paper profits for only small shifts in true valuation. Hell, Lehman brothers was running a 35:1 debt ratio. Even a small downturn would have been catastrophic for them given that level of risk. Other Wall Street firms were nearly as leveraged. Are you going to sit there and tell me that the '95 changes somehow forced Lehman brothers into that level of leveraging? I don't think you're THAT insane, are you?

No, screaming about the '95 changes are an attempt by the Republicans to shift blame away from their now obviously failed "Trickle-Down" economic theory by trying to blame Clinton and poor people. It's disgusting, it's ludicrous, and people aren't buying it this time.

Ultimately, I think what should happen is a bottom-up approach. Work with the people holding the mortgages and the actual lenders. Dump the people that lied about their incomes, etc. That's the truly toxic part that's causing the most problems. Then, work with those who could afford their loans originally, but got hit with huge rate spikes, etc, and weren't able to re-fi as promised, and who's loan is now bigger than their home value.

Let them work with judges to re-value the loans and re-adjust the interest rates back to something sane. Drop the value of the loan down to the current value of the house, less any equity they've already paid for in their loan payments. This means the values of those securities will be getting adjusted to real market conditions, and will not in any way artificially hold home prices up. But it will allow people to actually keep their homes and allow proper valuation of the securities directly based on the mortgages.

One way we help pay for this is adopt a British idea, that hasn't seemed to impede their financial markets one iota: a quarter percent tax on any stock transaction. Even a million dollar stock deal is only going to pay 2500 in tax, so no one in middle america who's involved in the stock market is even going to notice it. Furthermore, it will encourage longer-term stock holding, as if you just hold onto a stock rather than high volume day trading, you avoid the tax. But what it would do is raise between 100-200 BILLION dollars in new revenue a year, and all without hurting the middle class in the least....

-Arlos

[Martrae]

I see no one has looked at the video series I posted.

/sad panda

[Eziekial]

What? I watched everyone of them. You calling me a no body?

[Martrae]

I amend that....no one but fantastically intelligent Eziekial watched them.


Check this out

Found in the Senate bailout bill: "Exemption from excise tax for certain wooden arrows designed for use by children." (p. 263)

http://twitter.com/foundinthebill

[araby]

I also watched them.

[ClakarEQ]

Mart, i did watch a few as well, I just didn't make the time to watch them all.

I agree 100% with Arlos' post.

[KaiineTN]

It just amazes me how they think slapping more things on top of the bill will get someone to vote for it. This is their idea of finding a "solution." Oh, you don't like the $700 billion bailout? Oh okay.. what if we give you a tootsie roll? No? How about we give all you democrats tootsie rolls, and the Republicans will just get a stick of gum. Surely, now you agree that this $700 billion is a good idea?

[Diekan]

Bill passed Senate... tomorrow the House votes.

[KaiineTN]

[Drem]

this is pretty weak... rather than try to make our dollar worth more we just print $700b more to solve our problems at home, with an unsurprising disregard for our value in the world market. why would we ever work to fix anything when we can just sign some papers to do it.

zzzzzzzz

[Martrae]

Yep, what do they think will happen to the stock market once other nations no longer accept the dollar because it's worthless? Stupid congress having to make it look like they are 'doing something' because elections are right around the corner. They're rushing in and making the worst mistake they could have.

[Evermore]

its time to flush the toilet. let who is going to fail, fail and move on.

[ClakarEQ]

While I think the entire thing is complete BS from corporations and wall street risk takers, I personally don't want to see my 401k, the only source of cash I'll have in 30years, drop down to 4 or 5 digits either. Not saying it won't in 10 years, no one has a crystal ball, including Ron Paul. So while they think they know what will happen, no one knows for sure how things will play out over the next few years, with or without this bill.