hey guys remember no more government bailouts

[redbull]

http://www.reuters.com/article/topNe...G1567720080917

[JokeyLoki]

Ugh.

[Starla]

This was to be expected.

[Gish08]

Free market always decides in America! Hahaha.

Governments bailing out corporations?! That's socialism!

[sppunk]

The government had no choice - AIG is the largest corporation in the world of its kind. It greatly trumps Lehman and Bear Sterns in size, power and influence.

If AIG would have gone under, several developing nations could have easily collapsed.

[Skradgee]

Fuck AIG! I bailed on their car insurance because it was so friggen expensive, and now they're going to get my money as a taxpayer because they screwed up? I understand that the mortgage crisis has made things difficult for a lot of businesses, but what happened to diversification and not having all (or most) of your eggs in one basket?

[28if]

Originally Posted by sppunk

The government had no choice - AIG is the largest corporation in the world of its kind. It greatly trumps Lehman and Bear Sterns in size, power and influence.

If AIG would have gone under, several developing nations could have easily collapsed.

How so?

[Mo]

Originally Posted by sppunk

If AIG would have gone under, several developing nations could have easily collapsed.

Including the USA?

[sppunk]

AIG's demise would've hurt the world economy worse than the U.S.'s, probably.

[Nimrod's Son]

Who cares? We need to remember this is a free market, and you don't get a guaranteed profit.

[redbreegull]

Originally Posted by Nimrod's Son

Who cares? We need to remember this is a free market, and you don't get a guaranteed profit.

Filthy capitalist.

[Debaser]

newsflash: this is not a free market.

[dudehitscar]

if it is good for the overall economy then the 'bailout' will repay itself.

Anyone disagree with that logic?

[Nimrod's Son]

Originally Posted by dudehitscar

if it is good for the overall economy then the 'bailout' will repay itself.

Anyone disagree with that logic?

Yes. The "economy" is not an individual person. Ok, imagine you run a hot dog shop. And next door there moves in a Mondo Hot Dogs national chain, which is threatening to put you out of business. Then Mondo fails, but the government bails them out because of how many people they employ nationwide.

It's good for the economy... but is it good or fair for you? And how come some businesses get the right to take huge risks and fail knowing the taxpayers will bail them out?

These bailouts are more deficit spending. There's no win in adding to the national debt to help out people who ran their businesses like idiots.

[dudehitscar]

The people who 'ran the business' make millions regardless. The stockholders get screwed and it would of been a huge disruption to the entire economy.

I'm also suggesting that the bailout will not add to more deficit spending due to the stabilization of the economy and the financial rewards of that.

I see what you are saying Nimrod but when the death of stupid companies hurts a whole lot more than the company and the economy is not equipped to absorb another disaster like that then their can be some just cause for the government to help.

I know you will disagree because you categorically disagree with taxation being forced on you to pay for programs. So we will leave it there.

Anyone else?

[Debaser]

Originally Posted by Nimrod's Son

Yes. The "economy" is not an individual person. Ok, imagine you run a hot dog shop. And next door there moves in a Mondo Hot Dogs national chain, which is threatening to put you out of business. Then Mondo fails, but the government bails them out because of how many people they employ nationwide.

It's good for the economy... but is it good or fair for you? And how come some businesses get the right to take huge risks and fail knowing the taxpayers will bail them out?

These bailouts are more deficit spending. There's no win in adding to the national debt to help out people who ran their businesses like idiots.

this better not be an analogy to AIG because then holy fuck you are naive.

[sppunk]

Yeah, Mike, no offense but you're really off on that tangent there.

AIG's bailout, if anything, is a deficit-dwindling motive and something to bolster the struggling overseas (read: volatile) markets.

[Debaser]

AIG is in trouble from Credit Default Swaps and I finally found a very clear analogy from Econospeak:

Suppose somebody wants to make a bet with me that the San Francisco 49ers will win the next two Super Bowls. He gives me $100 today, and I have to give him $100 million in case he's right. The chances of this happening are very small, but just in case the impossible happens I want some backup. I buy insurance from my next-door neighbor. I offer to give him a nickel every week in return for his promise to cover my bet.

My neighbor sees that he has a good thing going -- getting money for nothing. After a while he takes on more and more bets until others follow in his footsteps. Soon, a market develops. In effect, people can bet on bets. Eventually, the total potential amount of money builds up into the billions and trillions of dollars.

Unexpectedly, the San Francisco 49ers win two Super Bowls in a row. My neighbor does not have $100 million on hand to cover my loss. The nickels I have been giving him have been wasted. I don't have $100 million either.Now imagine that between paragraphs two and three, everyone in the neighborhood started doing the same thing. The man and his neighbor seemed to be making so much money, so everyone got in on the action, and everyone got in on the same bet about the same game. That's the basic shape of the river: All these folks were making the same bet: Basically, that the housing bubble could last forever. Then when it popped, damn near everyone went down at once, because damn near everyone had gotten in on the action. It's sort of amazing to think that we've been paying finance CEOs incredible amounts of money to follow each other off a cliff, but there you have it.

[Nimrod's Son]

Originally Posted by sppunk

Yeah, Mike, no offense but you're really off on that tangent there.

AIG's bailout, if anything, is a deficit-dwindling motive and something to bolster the struggling overseas (read: volatile) markets.

It's more appropriate to Bear Stearns and Fannie/Freddie, but overall it's the philosophy and concept that the government should follow.

We keep hearing how these companies are "too big to fail." Well fuck, I guess they got so fucking big because the government failed in regulations, right?

This latest $85B bailout will cost taxpayers $800 each. Hey, now where's my tax stimulus check?

[Nimrod's Son]

Originally Posted by Debaser

AIG is in trouble from Credit Default Swaps and I finally found a very clear analogy from Econospeak:

OK, so you still support these bailouts?

[Debaser]

How can you not? I'm no expert, but if the head of the fed and all the experts are telling us we need to save AIG in order to prevent a catastrophy, then I'm inclined to agree unless compelling evidence tells me otherwise. It's fucked up that it has come to this and reforms and regulation must come in to prevent this situation again...but letting the disaster happen is not reform. Remember these bailouts are being carried out by a people who would otherwise be free marketers. If what they see scares them enough to go against their core public ideology, then that speaks volumes. Just like that old saying that "there are no atheists in foxholes", there are no free markters in a financial crisis.

[Debaser]

At least there may be a silver lining with the AIG bailout. In that if AIG gets it shit together and has an orderly sell off of assets and should be able to pay back the loan, the U.S. should actually make a decent profit from it since they are charging a loan shark rate for this bailout.

[Nimrod's Son]

I'm of the opinion that they're protecting the wealthy, and growing the power of government.

The US Government now owns the two largest mortgage lenders/buyers and one of the largest insurance companies.

[sppunk]

Originally Posted by Nimrod's Son

It's more appropriate to Bear Stearns and Fannie/Freddie, but overall it's the philosophy and concept that the government should follow.

We keep hearing how these companies are "too big to fail." Well fuck, I guess they got so fucking big because the government failed in regulations, right?

This latest $85B bailout will cost taxpayers $800 each. Hey, now where's my tax stimulus check?

You're debating cause to effect. The causes are all wrong, but the effect was needed.

The issue is with the cause, and getting it under control. The tax "rebate" checks, lack of oversight rules, etc. all were the leading factors.

And anyone who says anything is immune to failure is moronic.

[sppunk]

Originally Posted by Nimrod's Son

I'm of the opinion that they're protecting the wealthy, and growing the power of government.

The US Government now owns the two largest mortgage lenders/buyers and one of the largest insurance companies.

The US government should have always taken control of Fannie/Freddie, or relinquished entire control. They hybrid public/private co-op was doomed to fail.

The bailout of AIG protects the wealthy to save the poor, if that makes sense. If AIG fails, millions of small business would have immediately defaulted.

Government bailouts are awful, like so many other issues. Sometimes, unfortunately, it can be justified.

[Debaser]

Fannie and Freddie were originally government agencies in the first place. They were privatized in the late 60's(?) and now that they have been run to the ground, the government is now forced to take them back completely. People can say that we are taking over or "Nationalizing" fannie and freddie, but it would be more telling to say we are "de-privatizing" them.


To nimrod's point, it would be nice if we could enact laws that would somehow exempt the CEO's of these companies from benefitting from the bailouts. The people that ran these companies off a cliff should not be rewarded. Take away their golden parachutes.

[sppunk]

No one but CEOs and boards would disagree with that.

Oh, and maybe Mike Huckabee.

[Nimrod's Son]

It's just that once again, although I didn't make dumb purchases or greedy investments, I have to bail out the fuckers that did. We need to end the bailouts, even if it hurts the economy in the short term.

[ravenguy2000]

Meanwhile

http://www.politico.com/news/stories/0908/13579.html

The stock market swoons, home prices fall, job losses mount. But the president does not want to talk about it. Not really. And he certainly does not want to take any questions about it.

He has not taken any questions on anything since Aug. 6. On Wednesday his press secretary, Dana Perino, explained why. “If you guys [i.e., reporters] had him in here, almost everything would be geared towards the election, and he is cognizant of that,” Perino said. “I mean, every time that I would think about maybe having a press conference, the news of the day would be such that we might be talking about lipstick on a pig, and the president is just not going to get involved in it.”

In other words, the president is not going to get involved with restoring public confidence in our financial system because he is afraid somebody might ask him a question about politics. And because he doesn’t want to talk about politics (and why doesn’t he, considering he is supporting John McCain?), he won’t talk about anything.

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

What. The. Fuck.

[redbreegull]

Originally Posted by Nimrod's Son

It's just that once again, although I didn't make dumb purchases or greedy investments, I have to bail out the fuckers that did. We need to end the bailouts, even if it hurts the economy in the short term.

You must be living in a different United States of America than I am, because last I heard the economy was a matter of days away from a complete collapse according to the nation's leading economists. That is not short term.