Bailout: Will it work?

[yeahwho]

Bailout: Will it work? (http://money.cnn.com/2008/10/04/news/economy/will_it_work/index.htm?cnn=yes) Shouldn't that have been asked before the bill was passed?

The accompanying poll with the CNN article (http://money.cnn.com/POLLSERVER/results/42341.html)says NO! Out of 50,000 people who voted in the poll, 75% say NO!

from the CNN article
Many economists, however, say the president and other supporters of the bailout were painting too rosy a picture.

Until the tidal wave of foreclosures ends and home values stop their stomach-churning drops, banks will remain reluctant to lend and the economy won't improve, experts said.

"This bill doesn't contain any element of stability for the housing market or the real economy," said Christian Menegatti, lead analyst for economic research firm RGE Monitor. "The problems are going to come back and the lack of confidence will come back."

In fact, nearly one in three financial services executives said they expect credit standards to continue to tighten even if the bailout plan is approved, according to a Deloitte poll taken Thursday. So it will still be tough to get a mortgage or small business loan.

"We're back to more normal underwriting standards," Casey-Landry said. "People will need to have good credit to get a loan."

This gives no pleasure to hear, within 24 hours the doubt by those who voted on this bill and the ones who argued for it's passage are saying, WTF?

Unemployment and foreclosures are still rising. We still have a wasteful war in Iraq. Tax rates are still too low to fight two wars and balance the budget to begin with. Gas prices are still high and inflation is kicking in. The fundamentals just aren't there.

So we decide to write Paulson et. al essentially a blank check in a mad stampede. It reminds me so much of the rush to war in Iraq.


* on a local note I went to the mall today and I was pretty much by myself, that is really strange on a windy, rainy Saturday in Seattle. It is usually packed with no parking.

Has anybody else noticed a sort of slowdown or weird vibe commuting etc. ?

[roosta]

did they poll 50,000 economists?

[yeahwho]

did they poll 50,000 economists?

No, they should of polled 50,000,000 Elvis Fans (http://upload.wikimedia.org/wikipedia/en/6/61/50millElv.jpg). We need to get this thing right.

[travesty]

I think eventually the banks will loosen up, but not becasue of anything to do with the bailout, but becasue they have to. Lending is what banks do, they have to lend to survive. Saying that they aren't going to lend just because they're scared is BS. This was the biggest scam ever perpetrated on the public. I can't beleive that there is going to be so little oversight of Paulson on this.

[abbott]

i think the real estate market will pick up for the short term.

Comparing this bail out to breaking up with your girlfriend in high school: some just break up and some take the 3 month approach to the inevitable.

The bail out it is like the 3 month approach.

[yeahwho]

i think the real estate market will pick up for the short term.

Comparing this bail out to breaking up with your girlfriend in high school: some just break up and some take the 3 month approach to the inevitable.

The bail out it is like the 3 month approach.

I hope your right, just watching the Dow take a major dump. This looks like a little more than just a correction, or high school break up. I see the oil prices are edging down (to a semi-realistic price) and Gold is staying just about the same. I think we're in a major economic slowdown with the average consumer in debt beyond the realm of a quick fix. This is going to take several years and some serious belt tightening on everyone's part.

It's going to be a cold broke ass winter.

[kaiser soze]

It is working for the swine execs at AIG

CHECK THIS SHIT OUT!

http://abcnews.go.com/Blotter/story?id=5973452&page=1

After Bailout, AIG Execs Head to California Resort Rescued by taxpayers, It's Party Time with $23,000 in Spa Charges

Less than a week after the federal government committed $85 billion to bail out AIG, executives of the giant AIG insurance company headed for a week-long retreat at a luxury resort and spa, the St. Regis Resort in Monarch Beach, California, Congressional investigators revealed today.
AIG
The St. Regis Resort in Monarch Beach, California, was the site of a week-long luxury retreat for executives of the AIG insurance company, who headed there less than a week after the federal government committed $85 billion to bail out the company.
(ABC News Photo Illustration)

"Rooms at this resort can cost over $1,000 a night," Congressman Henry Waxman (D-CA) said this morning as his committee continued its investigation of Wall Street and its CEOs.

[yeahwho]

I just took a look at Casino Stocks, specifically Las Vegas and Atlantic City stuff, all of the portfolio's for these companies are currently low (like everything else) and what makes this a fascinating business to watch is it caters to illusion.

Seeing how Las Vegas has banked heavily on "High End" resort style gambling and extravagance since 9/11, the inevitable crash could really put a drag on this industry, which basically serves only one purpose, filling rooms with gamblers to take their cash.

Crazy ass times. Just like the AIG executives, we're in some sort of denial about our circumstance. Those AIG creeps, put there photos on the front page of the newspapers. Lets have a look see at these people.

[yeahwho]

The bailout money actually went into this? (http://www.starwoodspacollection.com/common/PropertyTreatments.asp?property_id=1361)

[kaiser soze]

did you check out my previous post?

yeah, so how do those who paid for this get a tax write off?

[HAL 9000]

It is working for the swine execs at AIG

CHECK THIS SHIT OUT!

http://abcnews.go.com/Blotter/story?id=5973452&page=1

After Bailout, AIG Execs Head to California Resort Rescued by taxpayers, It's Party Time with $23,000 in Spa Charges

That is truely shocking behaviour - I hope if one good thing does come out of all this, it is the political and public will for regulators to get stuck into the remuneration structures of financial institutions.

As the major AIG shareholder, I hope the federal reserve fires them, it is a chance to make some very public martyrs of some very fat cats. I bet they won't though.

In better news, AIG seem to be breaking itself up selling on so with any luck the loan will get repaid soonish.

[kaiser soze]

Here's the supposed bill

http://www.thesmokinggun.com/archive/years/2008/1007083aig1.html

like I said...this bail out was a mad dash for cash before the bushitas left office. One big fucking buy out, hush money, extortion, a rip off, and a lie

[chromium05]

I don't know how much coverage this (CDS') is getting in the US media, but Here (http://www.bbc.co.uk/blogs/thereporters/robertpeston/) is what all the bankers are worried about.

The CDS auction is today ( Friday), and those with CDS' related to Lehman alone amount to about $400billion.

[D_Raay]

Saying that they aren't going to lend just because they're scared is BS. This was the biggest scam ever perpetrated on the public.

Let's see since you said that the dow has lost another 2000 points, Iceland and Pakistan are going under financially. You sure know your stuff.

[kaiser soze]

Why isn't mccain bragging that he championed this bailout??

I guess he has better things to do on his Hate Talk Express

So where to now Superman?

[Ali]

LOL. The DOW hits 8451 and the FTSE 100 dips below 4000.

23 trillion wiped off the stock markets in one week.

But that money didn't exist, did it. It was all froth, stoked up by the likes of Greenspan and his ilk with Economic crack (2% base rate).

Unfortunately, our taxes did exist and now the Chinese have a controlling stake in the US economy.

The Good Times are about to begin. Socialists own Capitalists in every sense of the word.

[greedygretchen]

The Good Times are about to begin. Socialists own Capitalists in every sense of the word.

Ralph Nader actually said the same thing on Bill Maher the other night. The government is using Socialism to bail out Capitalism. We got straight jacked.

[travesty]

Let's see since you said that the dow has lost another 2000 points, Iceland and Pakistan are going under financially. You sure know your stuff.

And since you wrote that, it has come back 1200 and will continue to improve slowly, though haphazardly, until a stasis is reached that reflects a more accurate picture of the REAL economy than it did during the housing bubble. Then it will grow or shrink based on the actual economy and not knee jerk reactions. Yes it will be far less than the over inflated 13,000+ points we were seeing before but the market would have corrected downward eventually anyway. Fear mongering by the Feds is what drove it down so far, so quickly. The market will cure itself in time. The idea that government intervention can "cure" the market is egotistical and absurd.

I don't know everything, just more than you.

[skra75]

The bailout will fail.
It's like giving a crackhead a 20 dollar bill.
Shit will never work, it will fail again, and again, and again.