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Thread: Vote against the bailout!

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    Veteran Member luvbuniz's Avatar
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    Default Vote against the bailout!

    Congress has no right to give the White House and its Secretary of the Treasury the power to transfer the people's money to the richest bankers in the country. Paulson's 3 page document states:

    "Sec. 8. Review. Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

    This means he can do what he likes with the $700 billion dollars with no accountability or oversight! Are the politicians on crack? I'm mad as hell about this.

    Go to http://www.votenobailout.org/ this helps you email your local senator.

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    Default Re: Vote against the bailout!

    I happen to agree with you. However, there will be consequences if the 'full monty' bailout package doesn't pass ...

    - homeowners and car owners who are behind on their payments WILL be foreclosed on / repoed

    - unless you have a 700+ credit rating and a verifiable income, you'll be looking at 20% down and 9% interest rates on new mortgages ... if you can get approved at all

    - unless you have a 700+ credit rating and a verifiable income, you'll be looking at 17%+ credit card interest rates. If your credit rating is under 600 expect to have your credit line reduced to match your current balance.

    - expect that unemployment will rise by 3-4% as employers must pay higher interest rates for 'operating capital'

    --------------------------------------------------------------------------------------------------

    on the other hand, if the 'full monty' bailout bill passes ...

    - expect to pay 15-20% higher prices for gasoline, food, and any other global commodity or imported product as the 'printing' of 700 billion dollars will tank the US dollar exchange rate

    - expect to pay higher income tax rates for many years to come to cover the 'gap' between the 'face value' price the FED will be paying for toxic mortgage / bond paper and the much lower 'market value' that toxic paper can actually be sold for in the future

    - expect to pay higher income tax rates for many years to subsidize the actual (and mostly foreign) lenders behind delinquent US 'subprime' mortgages who will be 'paid off' in order to avoid court battles over foreclosure rights

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    Veteran Member luvbuniz's Avatar
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    Default Re: Vote against the bailout!

    The bailout would cause major inflation. I say to whoever lives beyond their means lives with the consequences. This includes individuals and banks, let the chips fall.

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    Banned Melonie's Avatar
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    Default Re: Vote against the bailout!

    ^^^ again I agree in principle. However, most registered voters do not have a 700+ credit rating or any cash in the bank with which to make 20% down payments !!!

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    Default Re: Vote against the bailout!

    I personally am on the fence about the bailout.

    I hate to see people I care about suffer because of deregulation and government greed.

    Either way its going to affect us all. But looking at it in a parental view point, you have to let your kids make mistakes before they learn. I think this country needs to learn from there mistakes and deal with the consequences.

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    Default Re: Vote against the bailout!

    The bailout would also give a "free pass" for TPTB to continue selling the future of our children and grandchildren to those who obuse the system in the first place!

    Better go through a bad recession now and clean out the "toxic" debt AND restructure the "paper" economy than trying to glue back the pieces of the structure that is not sustainable in the long term.

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    Banned Melonie's Avatar
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    Default Re: Vote against the bailout!

    ^^^ yet again I agree in principle. But congress isn't thinking about this in the same way that middle class taxpayers are. They're thinking of issues like ...

    - where will next year's big corporate political contributions come from ?

    - how many low income 'subprime' constituents are likely to be foreclosed on and evicted / laid off / denied credit ?

    - how many 'uber-rich' supporters are likely to yank their support if they wind up losing millions on their investments ?

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    Default Re: Vote against the bailout!

    I once had a friend who was very high up in "AOL" and he mentioned to me that the company was so heavily bureaucratic that simple issues could not be easily fixed. He said it would be much easier to re-write America On Line software as opposed to what they presently have which is a huge jumble of piece work code upon old piece work code.

    So in turn this seems to me to be very much like our financial system. The government appears to be much like AOL. We need a good CEO to come in and revamp the entire system and stream line it.

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    Default Re: Vote against the bailout!

    We're damned if we do, damned if we don't at this point. On principle, I think it's downright socialism. However, I do think it's the lesser of two evils.

    Not that it's any of our decision!

  10. #10
    Veteran Member Rockell's Avatar
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    Default Re: Vote against the bailout!

    This thread has been very informative-I have raised many questions to myself as I have been watching the news as to what exactly the consequences would be if the bailout was passed vs. not passed. I still don't know how I feel about it. Though the outcome of not passing the bailout would be really bad right now, I would rather go through it now than let my children and future generations pay for it for years to come. I think that this should be a wake up call to everyone (government included) to cut back and live within their means- we all don't need to own huge houses and 3 cars- and to work hard and save money for the things we want. I know easy and cheap credit is what drives the economy but enough is enough already.

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    Featured Member minnow's Avatar
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    Default Re: Vote against the bailout!

    Quote Originally Posted by Melonie View Post
    I happen to agree with you. However, there will be consequences if the 'full monty' bailout package doesn't pass ...

    - homeowners and car owners who are behind on their payments WILL be foreclosed on / repoed

    - unless you have a 700+ credit rating and a verifiable income, you'll be looking at 20% down and 9% interest rates on new mortgages ... if you can get approved at all

    - unless you have a 700+ credit rating and a verifiable income, you'll be looking at 17%+ credit card interest rates. If your credit rating is under 600 expect to have your credit line reduced to match your current balance.

    - expect that unemployment will rise by 3-4% as employers must pay higher interest rates for 'operating capital'

    --------------------------------------------------------------------------------------------------

    on the other hand, if the 'full monty' bailout bill passes ...

    - expect to pay 15-20% higher prices for gasoline, food, and any other global commodity or imported product as the 'printing' of 700 billion dollars will tank the US dollar exchange rate

    - expect to pay higher income tax rates for many years to come to cover the 'gap' between the 'face value' price the FED will be paying for toxic mortgage / bond paper and the much lower 'market value' that toxic paper can actually be sold for in the future

    - expect to pay higher income tax rates for many years to subsidize the actual (and mostly foreign) lenders behind delinquent US 'subprime' mortgages who will be 'paid off' in order to avoid court battles over foreclosure rights
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
    There's pain no matter what , but some "needed" counterpoints to points on top of page:

    1) WILL be foreclosed on........ // CP- Some people will be able to buy repoed property (homes/cars) real cheap

    2) 20% down, etc, new mortgages......// CP- lesser number of people that can be approved just might bring some insane prices down to more sane levels.

    3) credit line reduced.......// CP- people just might think twice before racking up high credit card balances- eg, if all you can eat buffets restricted what 1 could eat, there might be fewer overweight people!!

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    Default Re: Vote against the bailout!

    #1: Nobody knows what the actual consequences of the bail-out plan would turn out to be. We are literally rolling the dice here

    #2: Having said that, Inflation is a thousand times better than Deflation/Depression.

    Look at the possible worst-case scenarios:
    #1: Bailout is rolled out.
    * Confidence returns to market and financial industry. But Inflation rears it ugly head.
    Solution: Raise Interest Rates and Voila! problem solved (we are 2%, so there is plenty of Buffer on the upside)

    #2: No Bailout
    * More uncertainity. Financial crisis. Headed towards more deflation and possibly towards depression
    Solution: Cut Interest Rates (We are already at 2% so no buffer on the down-side)

    If you are a bi-partisan think-for-yourself-brilliant-minded person, you will chose the correct option


    PS: $700B is 5% of our GDP and probably less than 0.1% of US Net worth

    PS2: Due to our current unfair tax system, the rich picks up a significant portion of the $700B. This is truly taxing the rich guys so that Main street Average Joe will not suffer.

    PS3: The biggest benefactors of this bailout is the subprime below average person, who couldn't afford a home in the first place

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    Default Re: Vote against the bailout!

    PS3: The biggest benefactors of this bailout is the subprime below average person, who couldn't afford a home in the first place
    I would argue that this is true but only 50% of the story. The other big beneficiaries are the uber-rich bond investors who will avoid having to take major losses and the uber-rich 'merger' investors who will profit handsomely from acquiring desireable assets and leftover loss tax deductions from the inevitable mergers / buyouts / fire sales. This of course contradicts your 'claim' that the rich guys will wind up picking up the majority of the tab for this bailout. That 'honor' will fall on the middle class, both in the form of higher taxes and in the form of inflation prompted higher US dollar prices for food, energy, foreign goods etc.

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    Default Re: Vote against the bailout!

    A better way to go would be to open a "new" Chapter in the Bankruptcy code for banks and other institutions holding the mortgages and/or mortgage backed securities. Let them come in and have the mortgages and/or paper be valued at 50 cents on the dollar. All debt associated with and/or generated by sub-prime mortgages would be so valued. The mortgages themselves would be so valued.

    The banks would be permitted to emerge in a more solvent condition than they are in currently; they could revise their executive pay and bonuses and their stock could be re-valued to reflect their actual condition. Such bankruptcies could be fast-tracked to get the banks out and back to lending asap BUT the taxpayers would not be on the hook and there WOULD be a price for the banks and investment houses to pay for THEIR foolishness.

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    Veteran Member luvbuniz's Avatar
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    Default Re: Vote against the bailout!

    Quote Originally Posted by Eric Stoner View Post
    A better way to go would be to open a "new" Chapter in the Bankruptcy code for banks and other institutions holding the mortgages and/or mortgage backed securities. Let them come in and have the mortgages and/or paper be valued at 50 cents on the dollar. All debt associated with and/or generated by sub-prime mortgages would be so valued. The mortgages themselves would be so valued.

    The banks would be permitted to emerge in a more solvent condition than they are in currently; they could revise their executive pay and bonuses and their stock could be re-valued to reflect their actual condition. Such bankruptcies could be fast-tracked to get the banks out and back to lending asap BUT the taxpayers would not be on the hook and there WOULD be a price for the banks and investment houses to pay for THEIR foolishness.
    That's a great idea. I'm surprised that the Bankruptcy code has provisions for every other loan except mortgages.

    As for the economy, irrational exuberance is what caused the financial crisis in the first place. The tightening of the credit market might not be a such a bad idea. The market needs to go back to fundamentals i.e lending to individuals that can actually afford the loans.

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    Default Re: Vote against the bailout!

    Quote Originally Posted by xanfiles1 View Post
    #1: Nobody knows what the actual consequences of the bail-out plan would turn out to be. We are literally rolling the dice here
    Hey, we agree on something
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
    - Dr John Zoidberg

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    Default Re: Vote against the bailout!

    Bailout Protesters Send a Strong Message from Wall Street
    These photos were sent to us by Jeremy Scahill who attended the protests against Bush's bailout in New York City:
    http://www.alternet.org/blogs/peek/1...l_out_protest/
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
    - Dr John Zoidberg

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    Default Re: Vote against the bailout!

    things are about to get interesting !

    (snip)"BELGIUM's Fortis is this weekend poised to become the first large continental bank to fall victim to the credit crunch, as the global chaos continues with Bradford & Bingley and American savings giant Wachovia both teetering on the brink.

    The Belgian central bank and the country's regulator are paving the way for a bailout of the huge banking and insurance group, which has a £540 billion balance sheet and a market value of £12 billion.

    In Britain, the fate of Bradford & Bingley will be decided today. Fren-etic talks between the Bank of England, the Financial Services Authority and the government have been taking place this weekend to save the troubled mortgage bank.

    Santander, the Spanish bank, is in negotiations to buy B&B, but it is insisting on a stringent set of conditions. The talks are being led by Anto-nio Horta-Osorio, chief executive of Santander's UK bank, Abbey. "(snip)

    from

    Now we'll get to see how European taxpayers will react to gov't bailout proposals of their own !

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    Default Re: Vote against the bailout!

    When is the bailout suppose to be figured out/finalized?? I thought I heard that they had reached something... but, someone decided to reject at last minute? I'm not for sure... All I know is I'm scared & confused!

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    Default Re: Vote against the bailout!

    at this point, it looks like some sort of agreement has been reached in regard to a bailout plan. Basically it involves the US government borrowing an additional $700 billion dollars from the Chinese / Japanese / Russians, and using that borrowed money to purchase at 'face value' all sorts of mortgage bonds held by troubled banks (which actually have a market value significantly lower than their 'face value' ... which was the whole reason that these banks were in trouble). If real estate markets eventually recover, and the market value of these mortgage bonds actually rises back up to the level of their 'face value' then the US taxpayers will break even on the deal. However, if the market value of these mortgage bonds never recovers, the US taxpayer will be responsible for making up the shortfall ... in addition of course to paying interest on the borrowed $700 billion !!!

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