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2008-09-25 Home Front Economy

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Posted by g(r)omgoru 2008-09-25 00:00|| || Front Page|| [1 views ] Top

#1 Studies done on gambling addiction have shown that the thrill of the chronic gambler does not come from the hope they will win but the anxiety they feel when they fear losing.

FWIW.

Posted by no mo uro 2008-09-25 05:44|| 2008-09-25 05:44|| Front Page Top

#2 700 Billion? Recharter the Bank of the United States and become the prime lender rather than those who 'got their piece of the action' when the going was good and the now want to make the public basically financial serfs to their life style and careers. [Didn't we do that already in history, like how the original serfdom was initiated?]

The base argument is that capital is 'drying up'. It can be just as well infused into the market by a Bank of the United States as it can by other organizations who are looking out for their next big dividend to make the brokers happy or their next big bonus. Cut out the middlemen.

Posted by Procopius2k 2008-09-25 06:47|| 2008-09-25 06:47|| Front Page Top

#3 The base argument is that capital is 'drying up'. It can be just as well infused into the market by a Bank of the United States What has really happened is a huge misallocation of resources (overpriced housing sold to people who can't repay their loans). This capital has been wasted more than dried up, & this has rendered many lenders insolvent. They may as well go out of business & new lenders get the new capital. Warren Buffet put $5-10 billion into Goldman Sachs recently -- this could as well have been put into starting an entirely new bank. Or, as suggested, the Treasury could start its own bank with this kind of money.
Our esteemed representatives (M.C. could mean Member of Congress, or Misguided Child) continue to drink the slime-green Koolaid of "preventing foreclosures" and "helping homeowners" rather than face this reality. The MOAB (Mother of All Bailouts) will just waste more precious resources and delay the inevitable.

Posted by Anguper Hupomosing9418 2008-09-25 07:19|| 2008-09-25 07:19|| Front Page Top

#4 Spengler doesn't seem to understand how c4sinos are designed to work. Something about a house percentage, if I recall correctly.

Posted by trailing wife ">trailing wife 2008-09-25 07:20|| 2008-09-25 07:20|| Front Page Top

#5 The most interesting thing about the Congressional hearings so far is that not a single independent economist has testified about the MOAB. The MC's don't want to hear any alternative views. They just want to be seen as part of the consensus. If/when disaster happens, they will be sure to avoid the blame for their inaction, as they have so far.

Posted by Anguper Hupomosing9418 2008-09-25 08:06|| 2008-09-25 08:06|| Front Page Top

#6 I would okay the bailout if all the principles and their deputies were drawn and quartered in Central Park on live TV and it was mandatory for all bankers and stockbrokers to attend in person to learn a lesson.

Anything less I am against.

Posted by 3dc 2008-09-25 08:54|| 2008-09-25 08:54|| Front Page Top

#7 I suppose we could start a government bank, but that seems short-sighted considering how well governments run businesses.

Posted by Mike N. 2008-09-25 10:55|| 2008-09-25 10:55|| Front Page Top

#8 I have the South in front of me, and I have the bankers behind me. And for my country I fear the bankers more.
Abraham Lincoln

Posted by tipper 2008-09-25 11:09|| 2008-09-25 11:09|| Front Page Top

#9 great quote tipper.

Posted by Broadhead6 2008-09-25 11:14|| 2008-09-25 11:14|| Front Page Top

#10 I would add lawyers as well to bankers...

Posted by Broadhead6 2008-09-25 11:14|| 2008-09-25 11:14|| Front Page Top

#11 that seems short-sighted considering how well governments run businesses. Not so short-sighted considering how well BUSINESSES have been running businesses lately.

Posted by Anguper Hupomosing9418 2008-09-25 11:55|| 2008-09-25 11:55|| Front Page Top

#12 One help that they never seem to think of is to give the money to the debtors. They're talking about buying discounted mortgage packages to get them out of the system. Last night, one talking head was talking about paying ten cents on the dollar for these loans. How about offering a piece of that to me? Only a few per cent of those loans will default. Most of us can and will pay them off. Supppose, that for every dollar extra that I paid on my mortgage, I would get ten off my balance. Rest assured, I would make sacrifices to add every additional dollar possible to my payment. Nothing else could possibly give me a return for my money like that. Bean and rice three days a week would be a joy if I could get that kind of deal. Cash flow for the mortgage holders would increase, reducing the need to borrow. Less pressure on the borrowing would ease conditions throughout the econmy. I've just solved the economic crisis for the country and paid my mortgage off in three years!

Posted by Richard of Oregon 2008-09-25 12:21|| 2008-09-25 12:21|| Front Page Top

#13 Only a few per cent of those loans will default. At present we have no way of knowing the ultimate percentage of defaults. Your guess is as good as mine, which is a great deal higher. The market in mortgage securities has cast its vote -- by their extremely low bids on the securities. That market has not failed -- it just won't pony up the cash the holders of the securities want.
Some regions have been reporting price drops of 40%, and the situation is still progressing. Many buyers signed for mortgages far beyond their ability to pay, others signed for mortgages on grossly overpriced houses, other mortgage holders are experiencing drops in income -- for many of these buyers, foreclosure is the best choice available to them.

Posted by Anguper Hupomosing9418 2008-09-25 12:41|| 2008-09-25 12:41|| Front Page Top

#14 So, if we are nation of gamblers then we should have no problem in letting this problem run its course with a bailout. Take the risk that the banks won't fall like dominoes and that everyone's IRA, 401K, real estate and other assets will maintain or even increase in value. And if news reports are correct, most American's are against this bail-out/rescue plan. Everyone said all this about Superfund and other big programs but then all those "toxic" sites that have been cleaned up and are now "brownfield" have sold well and have been redeveloped for economic gain. This is a $700bn gamble - all in - do you play or take your chips and stay home hoping for the best?

Posted by Jack is Back!">Jack is Back! 2008-09-25 13:20|| 2008-09-25 13:20|| Front Page Top

#15 Sorry, first sentence above should read "without a bailout".

Posted by Jack is Back!">Jack is Back! 2008-09-25 13:21|| 2008-09-25 13:21|| Front Page Top

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