We're not socialists just yet.

EDIT: We are, however, fucked either way.

Tebor wrote:

We'll see. I was against the bail out, but this shit is serious.

I was and still am very much against the bailout. I guess I'm what you would call a free market advocate. Beyond that though, the bailout seems like it would solve the problem for a year, maybe two. Then, dumbass and greedy CEOs would go back to their subprime lending habits that got us in this mess in the first place. If that were the case, around 2013, we'd be seeing the same headlines, except this time, it would be a $1.5T buy out of those companies.

This is going to hurt in the short term. Bad. But I say let those companies declare bankruptcy. Fuck em. Let creditors own the banks. Let the CEOs get punished. I sure as hell don't feel like dropping ridiculous amounts of cash to reward execs who took unnecessary risks with their lending practices. All that will do will reinforce the behavior that got us here.

Don't get it twisted- in the short term, I think the economy is very well fucked, and we're ALL going to need somd KY; but I think bailing out the dumbasses that got us here will do nothing but reinforce their policies in the long term... which will lead to more and more expensive bailouts. I wasn't exaggerating when I said "we're still not socialists." The idea of the government dipping its hands in economic affairs like this is definitely not in the capitalist tradition. I do not like the idea of government intervention to this extent one bit.

Market forces should prevail and the CEOs should be pushed out, not saved. I hope the bailout package stays defeated.

anorexorcist wrote:

As a Canadian, should I be concerned? It certainly doesn't sound good, but it doesn't seem to be affecting my daily life yet.

Probably only to the extent that the US stops buying Canadian imports. From what I know about US-Canadian trade relations, the bulk of that is lumber (but I'm definitely no expert on that). Canada may see a downturn in US imports because of the housing supply overload (aka: no need to buy lumber to build houses... do we even still do that?). Other than that, I don't see Canada being too disrupted any more than the rest of the world economy.

Ice2SeeYou wrote:

I am far from being any kind of financial or political genius, but the article I read on yahoo made it sound like the reason the bill didn't pass was because the politicians were reluctant to vote for it so close to election time, rather than some kind of objection to the bill itself. If that's true, it's pretty sickening to read. Just reinforcing the public's image of the self-serving fat cats who only care about getting re-elected. Let the rest of us crash and burn.

Both sides are pointing the finger like a couple of kids. Pelosi talked shit about Bush policies. Republicans talked shit about Pelosi. And the wheel keeps turning. I'm convinced that the legislative branch of our government is little more than a bunch of kids fighting over who gets to play in the sandbox next.
The funny thing, large constituents on both sides had serious reservations about the buyout (including Obama and McCain) and now that it failed, both sides are seriously HUSTLING to use it to blame the other side for the OMG OH NOES end of America, when in truth, the bailout itself goes more against American economic policy (read: general laissez-faire capitalism) than its defeat ever could.

Ice2SeeYou wrote:

Feel free to educate me here, but aren't people to blame just as much as the CEO's and banks who leant them the money? I mean it seems like people purchased their homes at the low rate, and figured they'd worry about the inevitable higher rates later. Then those higher rates came, and sure enough they couldn't handle it. Again I'm not an economic genius, but it seems like a lot of people got themselves into this mess. I don't know that it's fair to blame the bank when you overestimated your ability to pay.

No, I totally agree. I'm all about personal responsibility, and that definitely does not include taking on economic responsibilities you can't cover. That said, the banks should have been able to reasonably appraise their ability to pay (credit history, value of assets, etc.). Also, the government pressured banks into giving subprime loans (wikipedia search "Community Reinvestment Act", particularly the additions during the Clinton years). While the CRA sounds good, it's at the core of the problem here... sometimes people can't pay the mortgages they apply for and are given. Banks saw it as a good way to make money, the government saw it as a good way to provide affordable (oops) housing to low-income earners, and low-income earners apparently saw it as a free pass for housing. Now that the time has come, nobody wants to pay the check.

Syd Lexia wrote:

Today would have been a great day to buy stock...

For real. I wish I had an extra $5,000. That shit would get invested immediately. Probably in window pane manufacturing since so many brokers will be throwing themselves from highrises in the coming weeks.