Is this a positive or negative for Obama and the Democrats?

[olegramps]

In the general discussion group, many are damning Reid and Pelosi as traitors and saying that this could cost the Democrats the election. It appears that most of those commenting regard it as a bailout for wealthy Republicans who have ripped off the America public. Are we to believe that without this bailout that the situation could be much worse if not dire? Those in favor of the bill say that banks are shutting down and refusing to make additional loans and if not rectified it could result in a total collapse of the economy. If this is the case, who would be hurt the most? It seems that the people's justifiable anger with the Wall Street thieves and let them go broke attitude could be most detrimental than bailing the bastards out. Waht do you think? I not sure who the hell to believe anymore.

[Jennicut]

1. Reid and Pelosi won't pass it without the cover of the Rethugs there as well

Its a tough one. Many would rather face a possible Great Depression then pass a $700 bill for Wall St. Its a tough call but banks will probably collapse further, credit is drying up for many companies and layoffs would start without further capital. Eventually it will effect main street and a depression would start to effect us all. I don't like the bailout either but Dems won't pass it without oversight and no golden parachutes for Wall St. ceos. We have to choose between tacking more on to our national debt or face a tanking economy. Some see the economy without a bailout as straightening itself out but I don't think I want to see how bad it will get. I know its not popular and people are pissed and have every right to be. Blame the rethugs, not the Dems. The Dems are trying to not hurt the taxpayers and save the economy as well. They are trying to see if the government can eventually make money off these loans. Problem is its complicated econspeak vs. anger at Wall St. and Washington and most people will turn to anger at gov and big business every time.

[soothsayer]

2. It will be a positive for the rich and will suck for the rest of us

And it will cover up all the crimes that have gone on to create this fiasco, as this lawyer explains:


A Comment on the Bailout Bill
Catherine and News & Commentary,
September 25, 2008 at 1:09 pm

By Carolyn Betts, Esq.

I agree with every point in Bernie Sanders’ proposal but have a suggestion.

I worked with lead counsel to the RTC (the government entity that served as receiver for defunct savings & loans) in designing and implementing the sealed bid auction program for non-performing commercial mortgage loans during the S&L crisis. I also worked for FHA’s lead financial advisor in carrying out the Congressional mandate that HUD enter into “negotiated” sales of its nonperforming multifamily loans to state housing finance agencies. Based on what I saw in these contexts and in carrying out sales of pools of VA, Farmers Home and HUD performing and nonperforming single-family loans, both in auctions and in mortgage backed securities form, my conclusion is this: the Wall Street players made out like bandits, ultimately at taxpayer expense and borrowers were not helped.I suggest we try another tack, in addition to what Congressman Sanders proposes: support the BORROWERS of the troubled loans, not the OWNERS of the loans. I believe there is a good chance that there is collateral and other fraud in these mortgage loan portfolios. I.e., loans with no properties to support them, multiple loans secured by a single property, loans used to launder money through government guarantees. This conclusion is based in part on the numbers, which don’t make sense, and upon observation of the number of HUD-insured loans that have gone into default before a single payment was received. If the lenders are just paid for these loans what is the theoretical value in a good market for these loans, assuming they are performing (i.e., above current market value), the lenders will get a windfall and be rewarded for making fraudulent and/or predatory loans. And the bailout as proposed will be a perfect way to hide the evidence of wrongdoing.

Would it cost anywhere near $700 Billion to have the government stand behind the borrowers’ obligations, in concert with a program to address unemployment/ underemployment and health care issues that are the primary sources of financial problems that cause these loans to go into default? I think not. I would impose a condition that the existing “problem” home loans in portfolio, and maybe also related home equity loans, be marked to decent rates of interest and reamortized over 30 or 35 years, with write-off of penalty interest, late fees, etc., at lender expense. Then, to the extent the borrowers still cannot make their payments but want to stay in their homes, have the government funding program (with a local-level administrator NOT controlled by those who caused the current crisis) make up the difference. Perhaps the government gets a lien on the property for only the amount of the borrower’s shortfall after a period of time during which the health care fix and jobs programs can take effect (say, 18 months).

I agree that the bailout bill will be a disaster, in so many ways I can’t even list them all. Allowing the market to crash, with all its consequences, would be better than giving away $700 billion + to the perps that brought us to the brink of world economic collapse. The longer we keep putting fingers in the dikes to avoid the consequences of bad decisions, money laundering and theft by the corporadoes, the worse the eventual flood will be.
http://solari.com/blog/?p=1605#more-1605

[leftofcool]

3. Negative

[cali]

4. I think it all depends

on how things playout. If repubs are largely on board, it won't hurt Obama against McCain. It'll simply be a wash.

[leftofcool]

6. Repukes will never be on board for tax payers bailing out WS

That will never happen and is the only thing I have ever agreed with any Republican on. They were against it from the getgo and 98% of the people were against using tax payers money for this, regardless of what clauses/stipulations were added. This will untimately not bode well for Obama or Dems, because it is still a giveaway, still the government taking over the market and was doomed to fail from the beginning.

[cali]

8. Just watch. The dems won't even attempt this without widespread

repuke support. Yeah, a certain percentage of rethugs won't vote for it but the majority will.

[leftofcool]

9. It is the outspoken ones that concern me

I can hear it now, "yes we voted for it because we just felt there was no choice and so to appease the "other party" we just let it pass, even though we think it is a bad idea." Or some other slime bag slew of statements that make Dems look like shit. You know how they are.

[jefferson_dem]

5. No need to be concerned. It will be a positive (or at least a non-negative) in the end.

A bailout plan was going to happen. The compromise is a vastly different animal than what was first proposed by Chimp-Paulson. It includes hardcore democratic principles (it's not an irresponsible blank check givaway to the Wall Street crooks) that will give cover to Obama and our guys as they run for re-election.

EDIT: Wow! I wasn't aware the flame war was so hot until I just now traveled over to "General Discussion." I think i'll stay out of the back-and-forth regarding the substance of the bailout legistation.

[leftofcool]

7. And when it fails? And it will fail

What do you think the Dems will look like then. 750 billion is just the tip of the iceburg. That is just the bad paper.

[jefferson_dem]

10. I'm not convinced that it will fail.

And the risk of inaction is, in my view, greater than the risk of (responsible) action. Economically and politically.

[mucifer]

12. They shaved it to 250 billion.

[olegramps]

11. In regard to home loan foreclosures

I wondered if a person had a loan in which the payments were to high for them to make, would it be possible to change the loan from a 30 year to a 45 year or maybe even longer loan making the payments more affordable. The people that I see losing their homes are devastated and would love to be able to stay in them if possible. I have seen car loans go from three years to five or more years to make them affordable. Could we do the same in regard to homes? Especially in view of the increase in people's life expectancy.

[Honeycombe8]

13. I don't know if it SHOULD pass...but my job probably hinges on it, as do hundreds of thousands of

others.

I can see where, if AIG were to go under, that there would be a ripple effect the likes of which I've not seen in my lifetime. If AIG goes under, tens of thousands (or more) people would lose their jobs as a direct result.

Then all the businesses that exist because of AIG would either go under or have layoffs because business would be bad.

Then there would be a large consumer spending deficit because of all the people out of work.

That, in turn, would cause more businesses to fail, and more people would lose their jobs.

Which in turn would cause even more businesses to fail, because there's less consumer spending.

I can see where it could turn into a depression-like economy. I don't KNOW that that's what would happen. But I can see it, because my job relies in part on the existence of AIG. My co. has already been hurt because Lehman Bros. failed.

What I DON'T know is if other companies would buy parts of AIG if the government didn't bail it out.