The bailout proposed by the treasury secretary is falling on rough times and deaf ears. It's about damn time Congress took a serious look at something rather than rubber stamping it. In case you didn't read the comments to the last post, the proposal to spend said money to float bad business decisions was a whole THREE PAGES LONG. I've written longer documents on the john. At least mine got an A. It doesn't take an economist to give this proposal an F. Three pages to "save" a multi-trillion dollar economy? Everyone's bullshit meter should be ringing loud and at least a good number on the congressional finance committee are.
Only a few weeks ago Paulson was saying that the economy was fine and would not require any bailouts. The fact that this proposal showed up poorly written, poorly thought out, and poorly presented to the people makes it smell awful fishy. The proposal, as is, includes zero oversight, zero methods for recouping this money, zero methods for the taxpayers to claim any of the profits generated from this money, and would drastically expand the treasuries powers to lend money in the future with only the swipe of a pen. It's also suspicious that the banks, lenders, and mortgage companies are going to get a say in how the plan (if there ever is one) is structured. What that usually means is freebies to the industry, bad terms for the taxpayers, and ultimately no responsibility taken and no lessons learned from the excessive risk.
If anyone is interested, I could churn out an actual analysis (which means facts and numbers, making connections among different lines of reasoning, and using these connections to reach reasonable conclusions about the situation- NOT opinion, grand-standing, or flawed logic common to 'analysis' on FOX NEWS and CNN) explaining how and why this all happened. I've been following it since it all started in the late 90's and it's a whale of a tale. It's complicated and interesting, but I'm not going to take the time unless there is interest. This one would require more thought than rant and a good explanation for concepts that you may be unfamiliar with (like credit default swaps, mortgage backed securities, leverage, or risk exposure). Even if you aren't economically inclined this is a rare opportunity for the public to see what is going on behind the scenes of their financial system and I encourage everyone to really try to understand the big picture, the details, and start thinking about how these types of issues will be addressed by the next administration. It's Enron on a massive scaled. And it was totally, completely preventable with common sense.
1 comment:
Glen Beck:
"The idea of government stepping in to bail out international banks that were reckless with their own business literally makes my stomach churn. We are privatizing gains and socializing losses... In fact, it would have to take an absolute disaster to make me even consider supporting something like this. Welcome to that absolute disaster.
This bailout plan is not a good idea -- it's an absolutely terrible idea. It's just the only idea we have left... Our financial system is like a 747 flying around with all four of our engines on fire. The bailout effort will not stop us from landing hard, but without it, we may simply drop out of the sky."
Can't really say it much better than that.
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