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What's your opinion on the bailout?

We've been hearing a lot from the bureaucrats, politicians and pundits about the U.S. government's plan to restore confidence in the financial system by rescuing banks from tons of bad debt. We'd like to get your opinions and hear how you're being affected. Your thoughts and experiences often shape our coverage. You can submit your comments to our Public Insight Network, post them here, or on any of our stories pertaining to the crisis.

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Wall Street execs are getting a well deserved trashing in the press, but let's not forget the mortgage brokers, builders, real estate brokers and bankers who have oversold the housing market. Let us also remember the individuals who borrowed money without reading the fine print, mortgaged their home way beyond realistic value to help pay other debts and expenses.

Also remember the people who had never paid off or even paid on time any debt, who borrowed to buy homes because someone would let them. There is blame to go around -- some for the greedy and some for the foolish. The bailout will be
developed by smarter people than me and I hope they do the job well because I think it must be done. 700 billion won't touch it in my opinion.

2nd shoe to drop.

I'm going to speculate that the reason why hank paulson has been scant on the details is that today's (wed) "blame" - Credit Default Swaps, is now a cascade of (again, unregulated) hedge funds in danger of collapse. Apparently hedge funds even acted as insurance parties to which ubs demanded they up their proof they could pay in the event of default. Hedge fund participants include institutions (like harvard endowment) to achieve 12% returns when the s&p was loosing in the market. It is LTCM all over again and no one wants to admit yet another problem due to missing oversight.

When BSC was liquidated the story was: "doing what the market would do naturally, but quickly so as to disrupt the market".

Preceding last fri, the story was: "need 700B blank check to mitigate problems by cdo's and siv's too complex to unwind". (gave my own rebuttal here: http://www.dailykos.com/comments/2008/9/20/191440/829/498#c498 )

Today with paulson, the talk is of Credit Default swaps as the problem.

BOB MOON:
The value of the entire mortgage market: $7 trillion.
The size of the credit default swap market last year: $45 trillion.
KAI RYSSDAL: That's a lot of money, Bob.
http://www.dailykos.com/story/2008/9/21/9322/74248/245/602838

Like the barrel of oil that trades 22 times on the nymex before being delivered, it looks like there are 6.4 dollars of "insurance" for every dollar of physical property.

so I'm guessing the public is being told "it's serious" but not given the fine details of yet another grand failure. They would much prefer to hide fault if it can be covered up by relieving pressure on balance sheets that have not been made public yet.

The goverment should not bail out these companies. If anyone gets bailed out it should be the taxpayers. They defaulted on loans, mortages etc. because of a bad economy and preditory lenders. Give the money to the people and maybe they can pay thier debt. Won't the goverment be double dipping? They bail out these companies and the companies have to pay them back. Then the taxpayer still has to pay this debt sitting on their credit reports. Since the goverment owns the debt, the taxpayer will have to pay them, plus the companies will pay them back..double dipping. The taxpayers debt isn't forgiven, no money is given to pay back debt. What about places like cashcall.com....why don't they put them out of business? The FBI should be investigating them and making them pay taxpayers back, as well as other payday loans. How can you investigate mortgate and loan companies for making credit easy when you allow other predators? How can you bail out these entites and not help the taxpayers? This is absurd to pass this law. Just like the tax payer, sorry, you screwed up fix it or lose everything!!!

Clearly, we are in a Financial Armageddon, one in which the next buyout will not be so inexpensive... but expect the cost to be magnitudes higher in order to deal with the Credit industries house of cards. This will begin the Domino effect when we hit double digit unemployment.

What is clear here is that Wall Street's investment advisers/pundits and prognosticators know absolutely nothing about investment nor giving advise, nor predicting the future -- as always has been the case. For that matter I have to question the track record of all those economists (such as the quarterly email I receive from UCLA Anderson School of Management) -- in fact where is that track record for everyone to see?

Even the good old DOW is a moving target and unreliable gage, ---if one stock does not perform move it out!

No - not all finance institutions and advisers are Crooks per se, but an entire Financial industry has been built up upon playing off the psychology and greed of the average investor. What is needed is someone to start a Financial Anonymous so that people who think they are investing can learn to say "I'm a Gambler and I'm a Looser" -- and the only winners are the ones who handle the money.

Those are just a few of my thoughts on the debacle.
Best

In our family, we have taught our children that their actions have consequences, and they have to face those consequences. We have been responsible with our money and bought a house within our means. We have not ran up thousands of dollars with foolish credit card purchases. I don't think it is fair to expect us to pay for others who have not been responsible. Why should Joe or Jane tax payer pay for the foolishness of others. Our children's children will be paying for this mess and the people who bought more house than they could afford will be rewarded.

300 million Americans, 700 billion in new debt. That's 2,333 in new debt for every man women and child. As a family of four, how am I supposed to get a mortgage when I just received an additional $9,333 in new liabilities. It would be ok is we had no national debt but our country runs in the red in the best of times. Is borrowing more really going to help anything?

I am so angry that greed has driven rich executives, builders, real estate people to exploit the American people with the kind of loans that were issued for homes.
I feel the government should bail out the banks, take those bad mortgages and re-finance the owners in a way they can afford to pay. This will make back the money used to bail them out. Also, kick the greedy highly over paid executives out on their collective ass's without a penny of compensation.

While the bailout may hold merit in the long run, it's nothing short of rewarding irresponsibility. It's like a parent being mad or dissappointed at their child when the child tears up their room when the parent left the sledehammer with the child. People ought to be held accountable and the canditates should actually speak above a 2nd grade level to about the issue to the American people and offer real, specific solutions that aren't so broad that you can't tell where they stand. Telling Americans, "I'll fix it" or "We need to work together and fix it" tells me nothing. My co-workers have offered better rhetoric and solutions during our 15-minute break that the government or the canditates have.

WE bail them out, THEY keep the millions they made. It's not fair!

It's just another way that people who aren't rich are being exploited by this government, which has deregulated everything, made the rich richer, and done irrevocable harm to our country.

I'm angry, disgusted, and scared, too. I don't see much hope.

I'm waiting to see what the candidates do.
One of them is going to be elected based on all kinds of promises to the electorate.They both made them!
How the heck are they ever going to be able to do anything with insurance or education or any kind of tax cuts when we're running trillions and trillions of dollars in debt?
There's going to be hell to pay whoever gets in. Cause they're going to be viewed as lying (once again) to all of us. They better start dealing with the bad news before they take office.

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