Not quite. A specific set of taxpapers didn't fulfill their obligation. So the lender lost money, and passed it on to the government, who took out their salaries, and other costs, then passed it on to ALL of the taxpapers, most of whom fulfilled their obligation. And therein is the problem. You seem to want to make this all of our faults, when in reality, it is only some of our faults. OldTrader
None of them would be on the hook if the policy makers had never created the legislation that allowed Wall Street to create the derivatives that the loan originators were able to sell to after they found the willing "victims" to prey on. Mozilo and his kind should be in jail. Cox and the 5 Wall St. CEOs that he allowed to gear-up to 30:1 should be in jail as well, and that includes Paulson. I'd much rather give those at the bottom of this sorry food chain a government note that keeps them from defaulting on their house. Otherwise, taxpayers end up on the hook not only for the defaulted mortgage, but for the public assistance these folks are going to need once they've been wiped out in bankruptcy.
How convenient that you left Republican ( and SEC Chairman ) Christopher Cox out of this mess. They were aware of the leverage being used by Bear and Lehman, and did absolutely NOTHING. They even turned a blind-eyes as Bear used it own "auditors" as opposed to outside auditors. You need to put down your partisanship and bias and get a clue, otherwise you look like a clown.
It's certainly true that there are been many government interventions over time in the US markets. And I would argue that most of them have led to further crises, and have been more costly in the end than it would have been simply to let the market sort it out. I think the point is that if we want to be socialists, let's at least have that argument. Let's put it to the American people. Let's not bullshit people. We want to socialize the key industries in this country, then let's have a vote. I think if it were put to the American people that way, it would fail. Do you realize only 24% of the people are in favor of this plan? Again, the market has been quite good at sorting out this type of thing. Yeah, maybe it has to go lower. But the vultures are already lined up, ready to go, when they see the right price. I'm prepared to buy cheap assets myself. But frankly, the price isn't there yet. I've bought many properties over the years on the courthouse steps. Right now, they aren't cheap enough. So let them fail. If they lose their house, they can go rent. I have some rentals for them. But don't make me pay for these deadbeats that couldn't, or wouldn't, handle their own responsibilities. OldTrader
the root of it all... this and only this is the reason we should not bail anyone out..I dont care if the economy crumbles. Not only should we not bail them out, but if the economy does crumble some of these guys should be put in jail...not given a free pass like the bailout is doing.... In most cases they KNOWINGLY mispriced risk in order to get a bigger payout....sorry but no can do....
That being the case, what's the odds that any plan that goes up for a vote doesn't die right then and there? What congress-critter in their right, if self-serving, mind would vote for something that their constituents would most certainly vote them out of office for afterward?
I heard an interview on Friday, where that was the question posed to a Congressman: If all of your constituents are opposed to the bailout, will you still vote for it? The guy answered yes. LOL. So I guess we'll see. Obviously some of these guys are completely ignoring their constituents. My suggestion is to send an email to your Senators and Congressman, express your thoughts. I did. You can find your Congressman and Senators online. OldTrader
what's worse, is that those who rented, as saw the market as a bubble, and painfully stood on the sidelines waiting for the market to correct, rather than overpay for a house, are now being asked to take some of their savings to subsidize an artificially inflated price of a house that they might want to buy those who balked at overypaying were a moderating influence agaisnt the bubble - those that overpayed were part of the cause of the bubble who should be rewarded, and who should be punished? the govenment is punishing the prudent here, it's in effect saying 'if there's another bubble (of a necessary good), you might as well jump in, because the odds of losing from standing aside are higher' we've had 2 bubbles in 10 years - nearly unprecidented. we need to get away from bubble dynamics, rather than reinforce them