I hear the LET THEM FAIL alot but then I hear Obama and his economic team of advisers and many other economists say if we LET THEM FAIL, the whole banking system will collapse. What is the truth? Does anyone really know or is it just a guess! Everyone understands that if they need to be bailed then the business is failing and this is capitlalism etc, etc. But what about the whole banking system collapsing? Have you considered what that may be like?
This is partial true and false at the same time. Although the top tier pays most of the taxes, the middle and lower class get hurt more by the devaluation of the dollar. Its a horrific circle jerk that will eventually end by the collapse of the dollar either way. People who refuse to learn the facts will eventually be decimated or forced too by reality.
The first time I heard Timmy Geithner speak I guess I expected some Robert Rubin type utterances about stabilizing markets and freeing up credit. Instead the guy launched on a 5 minute tirade about global warming. I was fucking speechless. This administration is a complete disaster for the country. They are demonizing business and capitalism. I'm sure it all seems normal, if you are from Chicago. The rest of us are wondering how our fellow citizens were duped into voting for this stupid schvartza. The Obama administration wants oil and natural gas to be very expensive to the consumer. They are going to kill coal outright. They believe the citizenry of the US must reduce its lifestyle to reduce carbon emissions. They understand this means a reduced GDP. Its part of the Green Regime. Seriously, you folks voted for him and you deserve the consequences. Perhaps you will be more thoughtful and careful about your future voting and not put some putz kid from the south side into the most powerful office on earth. Phhtt!
The following is what scares economists and what makes all those people saying let them fail look rather reckless. From Wikipedia article on The Great Depression: "Banks began to fail as debtors defaulted on debt and depositors attempted to withdraw their deposits en masse, triggering multiple bank runs. Government guarantees and Federal Reserve banking regulations to prevent such panics were ineffective or not used. Bank failures led to the loss of billions of dollars in assets.[14] Outstanding debts became heavier, because prices and incomes fell by 20â50% but the debts remained at the same dollar amount. After the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By April 1933, around $7 billion in deposits had been frozen in failed banks or those left unlicensed after the March Bank Holiday.[15] Bank failures snowballed as desperate bankers called in loans which the borrowers did not have time or money to repay. With future profits looking poor, capital investment and construction slowed or completely ceased. In the face of bad loans and worsening future prospects, the surviving banks became even more conservative in their lending.[14] Banks built up their capital reserves and made fewer loans, which intensified deflationary pressures. A vicious cycle developed and the downward spiral accelerated. The liquidation of debt could not keep up with the fall of prices which it caused. The mass effect of the stampede to liquidate increased the value of each dollar owed, relative to the value of declining asset holdings. The very effort of individuals to lessen their burden of debt effectively increased it. Paradoxically, the more the debtors paid, the more they owed.[12] This self-aggravating process turned a 1930 recession into a 1933 great depression." The bailout is about preventing the snowball from getting bigger and the vicious spiral getting out of control.
I agree with you Coral, and I only make 60k a year. But one day I would LIKE to earn my way to the top 1%. Notice I said earn. Sadly, most of our fellow citizens want to sit on their fat rear-ends, watch teevee, and complain how they ain't gettin' theirs. I'm so sad for this once great republic.
Thankfully, the whole sordid mess will most impact those who voted for this idiot. Dollar trashing, huge debts, etc, will/should impact the young most. Good-they voted him in office.
Not really all the bailout money should have been given to FDIC then let all the business chips fall where they may. Instead the govt is trying to guarantee(purchase) the whole housing, auto and bank CDS economy.
It is indeed true. Those with the loudest voices of opposition to the government interventions frequently have the least to lose (or gain, for that matter). You know who really needs to STFU? Most reporters on television who are doing nothing more than fanning the flames on this topic. It would bother me less if they actually knew what they were talking about, but it's very apparent that they are just reading a teleprompter and showing their "outrage".
You'll be long dead when the new top taxpayers will be paying to clean up this mess. This isn't a little bump in the road for the USA. It's a fundamental and long term.