I think many lawmakers and citizens are missing the point. It is not a $700 billion blank check. It is up to $700 billion, and it is being administered by one of the smartest investment bankers ever, Henry “Hank” Paulson. Also, he is not charged with making money for Goldman Sachs or himself. He will be using his prowess to make money for the American populace. How will he do this? The same way entrepreneurs have made money since the beginning of our great nation: by buying undervalued assets, putting them into new products, cutting them into pieces or bundling them together, then selling these pieces to buyers at a profit. The problem is not whether these securities will be purchased. The real problem is by whom and for how much will they be purchased. If we let the mortgage-backed securities get cheap enough because the banks holding them go under, there will be buyers and they will make trillions of dollars. (Yes, I said trillions). The buyers will be foreign governments with long-time horizons. They will own one of the things we hold most dear: our homes and our land. I would not want them holding my mortgage because that gives them rights to help set the value of my property. Lawmakers, let’s keep our mortgage-backed securities in the hands of the U.S. government or U.S. companies. It is far from perfect, but it is the best option we have. Let's clean up this mess and move forward.
My comment is that some TV shows are encouraging people to "overspend" and I'm constantly amazed at what people think are "reasonable" fees for products and services for their homes! Get real. I know I live in the midwest, but give me a break. And retailers who contribute to this "fantasy" are on my No Visit List! Heads up Sears and many others!!
The financial system needs to be purged. It would be painful, yes, but doing this bailout is very unlikely to work. The truth is that on Wall Street, a lot of people just weren't very good at their jobs. It's as simple as that. These people were being paid $50 to $100 million a year. Some of them, the guys that were running the places there is no defending. A general public who couldn’t live within their means also shares this blame. This government that promises to rescue the economy is only rescuing their circle of elitists, the very same people that got us into this mess. Wiki some of the companies involved and look at the alumni. You will be surprised, if not shocked at all the connections to politics, past and present. The “Powers That Be” wouldn't take "no" for an answer on the proposed $700B bailout and used fear mongering and sweetening the pie with pork plus a lot more money and benefits to push this through to a tune of over $800B. Few of the opposition in the House were fighting this bailout on economic principle, only out of fear of public outrage. The real target of the bailout is not to rescue payrolls or savings, it is meant to save the huge pyramid of derivative-type insurance policies AIG, Goldman Sachs (who Paulson was the CEO of) and JP Morgan Chase had written guaranteeing structured mortgage debt instruments that have been marketed to investors and banks around the world. Those derivatives, called Credit Default Swaps (Wiki this for explanation) are a huge shadow market that may control our financial destiny, and yet the details of these private insurance contracts are hidden from the public, from stockholders and federal regulators. No one knows what they cover, who owns them, and whether or not they have the money to pay them off. They are, however, at risk - all $62 trillion (the best guess by the International Swaps and Derivatives Association) of them. Sixty trillion dollars. I know it seems incredible. It's four times the size of the U.S. debt. But that's the size of the market according to these voluntary reports. This market is almost entirely unregulated, and sucking billions out of promoter's coffers with no end in sight. Don’t anyone kid themselves. The majority of this money we will never see, let alone get. The Global Elite will continue to swim in seas of money while we struggle to make ends meet. All in all, only the public lost. When the government owns businesses, it’s called socialism.