Economy, Bailout, I am not so clear on this--anyone else confused?

[eilen]

I guess I must be in a minority of people who are really clueless about the bailout. I totally understand the fact that most corporate balance sheets hold a lot of make pretend value based on debt and financial vehicles made totally of expected returns on debt instruments that someone else may own. Those balance sheets include many banking and insurance institutions.

But this is nothing new and it confounds me how the subprime mortgage mess is the culprit as compared to all the credit cards with $20,000 limits and car loans of over $30,000 and outstanding healthcare receipts, the huge sucking sound of jobs and industry leaving the country, the huge increase in the price of gas/oil as well as food etc. Really, after the S&L, the energy meltdown with Enron, Worldcom, and any number of bubbles that burst--how is it laid out that it is the little guy, the beneficiaries of the Community Reinvestment Act, the people who worked their asses off to meet their bills --I just can't buy it that these are the ones suffused with avarice and deliberate ignorance of financial matters--especially when it was those people who were urged to go shopping and spend spend spend, who were heavily marketed to turn their homes over --remember the postcards from real estate agents? mortgage banks? and how many credit card offers do you receive each week?

So bailout or no bailout? What is the solution? It became a sudden emergency. The president, who barely managed to pause his social calendar to drop by New Orleans after Katrina, when it was under water is now VERY CONCERNED about The Financial Crisis that must Be Resolved RIGHT AWAY with billions and billions of taxpayer money, (which is very interesting as the people of New Orleans were told to expect weeks of nothing but a bankcard to pay for their temporary lodgings, forget any serious aid for the restoration of their homes).

This guy has gone on tv and lied to me before. The guy who has been firing the flares, Paulson, well---he used to work for one of these big banks who made these stupid decisions-- why should I really believe him? He's headed for some lobbyist job anyway come January.

The Democratic leadership.... Well, they voted to pass the bankruptcy bill, screwing every voter from the ability to take shelter from their debts. We get no bail out. Should I believe them? If so, will this be what we need to do to fix things? I don't like the time pressure.

The Republicans, I feel they got us into this mess with their mantra of deregulation. They want market forces to correct things instead of putting rules back to prevent this from happening again. That didn't work out in the 30's. On the other hand, I have to admit some schadenfreud when it comes to Wall Street and the investment class and am reluctant to encourage my rep to vote for my (and every other taxpayer) money to help them keep their Lexus payments.

Why this crisis so close to the election? Can this be a power grab? Is this a manufactured crisis to distract us from something else?

I don't know who to believe. On the one hand, it seems like all the things they have done so far haven't really made any effect. On the other, will we be able to weather this without mass unemployment and a Depression?

I guess I have lost trust not only with the banks but also with my government.

[Eric J in MN]

1. Con men rush their marks.

Henry Paulson could have told Congress and the public months ago: if more corporations declare bankruptcy, then I will want new powers.

Congress and the public would have had months to debate if that would be the right solution in that case.

Instead, he waited until Congress was about to go on vacation and said give me new powers or the risk economic doom.

Congress should reject his plan, and wait until we have President Obama to vote on any more major legislation.

[JfortheDonks]

2. Read This Link

http://wwww.historyplace.com/worldwar2/riseofhitler/begins.htm - read The Great Depression Begins in the index and see if you notice any similarities. When things totally collapse, the President can enforce Martial Law, and the Constitution and Bill of Rights are suspended at that point. Congress can't do anything about it for at least 6 months. It's part of the Executive Orders. Why more people in this country are not aware of this, I don't know. <object width="425" height="344"><param name="movie" value="http://www.youtube.com/v/oAADyc6t4nY&rel=0&color1=0x2b405b&color2=0x6b8ab6&hl=en&fs=1"></param><param name="allowFullScreen" value="true"></param><embed src="http://www.youtube.com/v/oAADyc6t4nY&rel=0&color1=0x2b405b&color2=0x6b8ab6&hl=en&fs=1" type="application/x-shockwave-flash" allowfullscreen="true" width="425" height="344"></embed></object> Here is Rep. Marcy Kaptur (D-Ohio) speaking out yesterday about the bailout. Rep. Michael Burgess also spoke out (R-Texas) yesterday and said that Sunday, Martial Law had been declared. But I am not sure if he means Texas or exactly where. I have that link of his video in another post I put on today under the General category on here.