Thread: Bailout rejected! American economy screwed?

Originally Posted by Slim Chance

However the markets will sort it out in time.

If the cave men survived the ice age and women continue to give birth, this economy will no doubt, survive.

So you and Wilma are gonna ride this thing out eh Fred? Pebbles will be fine you can bet on that.

The Bailout

It is bad economic policy—By refusing to address the monetary system while continuing to place the burdens of the bailout on the dollar, we can be certain that in time, we will be faced with another, more severe crisis when the market figures out that there is no magic government bailout or regulation that can make a fraudulent monetary system work.

^ yours is up for rent then?

Yea, outta' the trailer park and back under the bridge with him!

Intrepid will pay him in foodstamps.

Originally Posted by tomcat

Congratulations to the ones who pander to constituents' luddite fears

Originally Posted by Ron Paul

we can be certain that in time, we will be faced with another, more severe crisis when the market figures out that there is no magic government bailout or regulation that can make a fraudulent monetary system work.

Commentary: Bankruptcy, not bailout, is the right answer - CNN.com

Thoughtful advocates of the bailout might concede this perspective, but they argue that a bailout is necessary to prevent economic collapse. According to this view, lenders are not making loans, even for worthy projects, because they cannot get capital. This view has a grain of truth; if the bailout does not occur, more bankruptcies are possible and credit conditions may worsen for a time.

Talk of Armageddon, however, is ridiculous scare-mongering. If financial institutions cannot make productive loans, a profit opportunity exists for someone else. This might not happen instantly, but it will happen.
Further, the current credit freeze is likely due to Wall Street's hope of a bailout; bankers will not sell their lousy assets for 20 cents on the dollar if the government might pay 30, 50, or 80 cents.

The costs of the bailout, moreover, are almost certainly being understated. The administration's claim is that many mortgage assets are merely illiquid, not truly worthless, implying taxpayers will recoup much of their $700 billion.

If these assets are worth something, however, private parties should want to buy them, and they would do so if the owners would accept fair market value. Far more likely is that current owners have brushed under the rug how little their assets are worth.

The bailout has more problems. The final legislation will probably include numerous side conditions and special dealings that reward Washington lobbyists and their clients.

By now, to repeat this point yet again, the total world derivatives of in excess of one quadrillion dollars... and may be already approaching the neighborhood of $1.5 quadrillion or even more.

the US GDP (currently estimated between $14 and $15 trillion).

NO To The Paulson-Bernanke Derivatives Bailout

Instead, J.P. Morgan Chase devoted itself more and more to the issuance, sale, and purchase of derivatives. As early as 1992, the best definition of J.P. Morgan Chase was that it was no longer a commercial bank but rather a derivatives monster. In 2002, the J.P. Morgan Chase derivatives monster came very close to imploding, collapsing in on itself like the hopeless black hole that it still remains to the present day.

According to the most recent report of the Comptroller of the Curreny of the US Treasury dated September 30, 2007, JP Morgan Chase today has between $90 trillion and $100 trillion of derivatives. In reality this is a very low-ball estimate, and the real derivatives exposure is some multiple of this figure ­ perhaps $300 or $400 trillion, especially now that Bear Stearns, a smaller black hole of derivatives has been absorbed. But even a mere $90 trillion is already six times the US GDP (currently estimated between $14 and $15 trillion).

These derivatives were originally supposed to be used as a hedge against risk, but before too long they began to represent the biggest single source of risk and the entire lunatic edifice would finance. By now, to repeat this point yet again, the total world derivatives of in excess of one quadrillion dollars... and may be already approaching the neighborhood of $1.5 quadrillion or even more.

One of the inherent problems of derivatives is that nobody knows this exact figure, since derivatives are not reportable in many countries and tend to escape regulation by the proper financial authorities. DERIVATIVES ARE USELESS AND A THREAT TO CIVILIZATION You cannot eat derivatives. You cannot live in a derivative. You cannot wear derivatives as clothing, nor can you drive a derivative work. You cannot sail in them or fly in them. They cannot be used as tools of any useful trade.

They are not computers, not machine tools, not pharmaceutical equipment, not agricultural implements. Derivatives are therefore totally outside the realm of capital goods production needs, no matter how these may be defined. FOR RECOVERY, WIPE OUT, SHRED, DELETE ALL DERIVATIVES J.P. Morgan Chase, therefore, performs no useful or productive social function, and there is absolutely no reason in the world why the people of the United States should want to bail out this pernicious and socially destructive institution.

It has probably been several decades since J.P. Morgan Chase created a single modern productive job. J.P. Morgan Chase's strategic commitment in favor of the derivatives bubble means essentially that we can easily dispense with most of the functions of this self-styled "bank," really a casino. Instead of being bailed out, J.P. Morgan Chase ought therefore to be seized by the Federal Deposit Insurance Corporation, and put through chapter 11 bankruptcy.

In the course of that bankruptcy reorganization, the entire derivatives book of J.P. Morgan Chase must be deleted, shredded, used as a Yule log, or employed to stoke a festive bonfire of the derivatives. The world did much better when there were no derivatives, and will get along just fine without them. Derivatives were of very dubious legality in general and were illegal in some of their specific forms until the mid-1990s.

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Originally Posted by Farangrakthai

J.P. Morgan

How fitting would it be if J.P. Morgan were to collapse.

The creation of the Federal Reserve was no different. It all began in a New Jersey train station on a night in November 1910.

Leaving from a Hoboken Railway station were a group of the nation's leading financiers and a powerful Congressmen and his staff. And although few of them knew it at time they were headed for Georgia, 1000 miles away.

Their mission was a secret and in the end it would change the nation forever.

And while a few reporters suspiciously witnessed the gathering of the powerful, none of them bothered to report on the exodus. The men, they were told, were simply going duck hunting.

But to be sure this was no ordinary hunting trip. The railcars themselves were sealed and the blinds were drawn. And each member of "the hunting party" was instructed to at no time to use his own last name or to use that of any of the others.

And while they stopped short of outright disguises, their intentions were clear-their identities were to remain secret.

Leading the ultra secret trip to Georgia was Senator Nelson Aldrich, head of the National Monetary Commission. Joining the Senator was A. Piatt Andrew, Assistant Secretary of the Treasury, Frank Vanderlip, President of National City Bank of New York, Henry P. Davison, senior partner of J.P. Morgan Company, and generally regarded as Morgan's personal emissary; Charles D. Norton, president of the Morgan-dominated First National Bank of New York, Benjamin Strong, also known as a lieutenant of J.P. Morgan; and Paul Warburg, a recent immigrant from Germany who had joined the banking house of Kuhn, Loeb and Company of New York as a partner.

And while these names may be hardly recognizable today, in their day these were powerful and well known men indeed. And as amazing as it seems they represented approximately ¼ of world's wealth.

from: The Creation of the Federal Reserve

Originally Posted by aging one

So you and Wilma are gonna ride this thing out eh Fred? Pebbles will be fine you can bet on that.

Yeah, she can sleep on the sabre-tooth tiger skin rug in MY cave!

Sorry, nothing much to add to this, but the U.S. is going bankrupt and the Russkies are rattling their sabres... (I just used the word 'sabre' twice in one post, where's my set of sateak knives?) so it's 'old school' week isn't it? Hello, Cold War and movies about spies and nuclear missiles, and action heroes with Teutonic accents and pop-stars dressing in kilts....ah memories...

Nah aint that bad. McCain just got dished. He made such a big deal about how he stepped in, suspended the campaign and all. Then when the votes were tallied his forces deserted him. ..

The biggest financial crisis ever.....supposedly. But wait, there's time to shut down all Congressional business for this:

Leaders in both parties said they are working to bring the bill to the floor again later in the week. Congress is adjourned for the next two days for the Jewish holiday Rosh Hashana.

http://www.news-leader.com/apps/pbcs...WS01/809300374

This is also why the bill was rushed to a vote Monday without enough time given to the members to read and digest what they were voting on.

Salam aleh Khum to you to.

^just calling like I see it......a religious holiday(of a group that represents anywhere from 1-3% of our population) obstructing govt work on what we've been told is a world financial system ending event.


where's the outrage?