What is it Really Going to Cost?

In the Austin Powers movie, Dr. Evil holds the world hostage for a ransom of $100 billion dollars. In the real world we have Hank Paulson holding America hostage for a trillion dollar ransom. All we are missing is Mini-me and the hairless dog Mr. Bigglesworth. If we do have to pay, then something must be done to make sure this never happens again.

..................................Any American hearing all of the news this week about the Bailout and Economic Mess that we are in should be able to realize that the Bush Administration has been doing a poor job with our economy. The Republicans have been doing poorly in the economic area of government since Herbert Hoover was screwing up our economy in the 1920s. Americans learned their lessons and stayed away from any hard core Republicans for many a year until Ronald RayGun brought in a Hard Line Right Philosophy in the 1980s and we are now victims of Bush following this poor way to govern......................Will Americans learn the lessons of history and dump McCain who is close to Bush and the other Republicans in approach who were helping the wealthy at the expense of Average Americans????

SAVE AMERICA
OPEN DOORS
AMERICA IS A COUNTRY OF IMMIGRANTS
IMMIGRANTS WILL SAVE AMERICA
GIVE CITIZENSHIP FOR EVERYBODY WHO BUY A HOUSE BY CASH

McCain might lose my vote with this....Maverick my ass!! Why is he supporting this? They only people who support this; are idiots who bought houses they couldn't afford and these corporate losers. McCain be a Republican for a change - Less governemt, more personal responsiblity.

As a fiscally responsible individual and small business owner I strongly OPPOSE the bail-out of reckless private companies in any form, in particular the massive $700B plan currently under consideration. I ENDORSE fiscal responsibility, accountability, living within our means and paying the consequences, whatever they may be, if we do not. I believe reckless government policies and staggering incompetence and unaccountability are as much to blame for the current economic crises as is Wall Street and the consequences of more of the same, which is inevitable, will be worse than any possible good that can come out of the bail-out. It is time to learn from our mistakes, not perpetuate them.

This is a bad idea..........This rewards bad behavior and covers up the incompetence of Congress.

Here's how the deal worked at the Resolution Trust Corporation, and the model is both simple and proven successful: The "bailout" was funded with $100 billion plus authority to access another $50 billion if needed. The RTC acted as trustee; they held the assets and were congressionally mandated to dispose of them in an orderly manner. No fire selling was acceptable and there was regular reporting to Congress by the CEO (David Cooke) and Lamar Kelly (Deputy Director over Asset Sales). Over a period of 5 years, the RTC sold $485 billion in assets at an average price of 86% of "par" (or 100% of face value of the assets). That means that after operating costs and discounts, the RTC sold these assets successfully, during a time of market instability, for a total bailout "cost" of $68 billion. At the sunset of the RTC, they returned the remaining $32 billion to the Treasury. It was an outstanding effort and the S&L industry was re-regulated in the process, which kept the similar causes from happening again. The model being proposed can work well. So what do we need to regulate this time to keep this problem from recurring? Here it is: the real problem is whether we are going to continue to not regulate marketing and underwriting activity of mortgage firms and credit card (consumer) lenders who are constantly flaunting low rates and tantalizing ads in the mail and on the internet. We are in this state because we have been a boiling frog for over 30 years, continually kidding ourselves and teaching our kids that if we can make the payment, it's OK to do it. This mindset, and not "this or that administration" is why we are in this mess. We CAN re-regulate mortgage and consumer debt underwriting and marketing. You don't see these kind of ads for buying securities or for regular bank loans. Why? BECAUSE THEY ARE REGULATED IN WHAT THEY CAN DO. We can do the same with mortgages and consumer debt, and this will go a long way to solve the problem. Wall street just gave these markets back end distribution channels...they didn't make the loans. Tighten up the ads and the underwriting and the back end capital meets the market need. Period. Done. Finis. I sure hope we can learn from this mess, because if we don't, history will just repeat itself, with higher and higher costs each time.

Here's how the deal worked at the Resolution Trust Corporation, and the model is both simple and proven successful: The "bailout" was funded with $100 billion plus authority to access another $50 billion if needed. The RTC acted as trustee; they held the assets and were congressionally mandated to dispose of them in an orderly manner. No fire selling was acceptable and there was regular reporting to Congress by the CEO (David Cooke) and Lamar Kelly (Deputy Director over Asset Sales). Over a period of 5 years, the RTC sold $485 billion in assets at an average price of 86% of "par" (or 100% of face value of the assets). That means that after operating costs and discounts, the RTC sold these assets successfully, during a time of market instability, for a total bailout "cost" of $68 billion. At the sunset of the RTC, they returned the remaining $32 billion to the Treasury. It was an outstanding effort and the S&L industry was re-regulated in the process, which kept the similar causes from happening again. The model being proposed can work well. So what do we need to regulate this time to keep this problem from recurring? Here it is: the real problem is whether we are going to continue to not regulate marketing and underwriting activity of mortgage firms and credit card (consumer) lenders who are constantly flaunting low rates and tantalizing ads in the mail and on the internet. We are in this state because we have been a boiling frog for over 30 years, continually kidding ourselves and teaching our kids that if we can make the payment, it's OK to do it. This mindset, and not "this or that administration" is why we are in this mess. We CAN re-regulate mortgage and consumer debt underwriting and marketing. You don't see these kind of ads for buying securities or for regular bank loans. Why? BECAUSE THEY ARE REGULATED IN WHAT THEY CAN DO. We can do the same with mortgages and consumer debt, and this will go a long way to solve the problem. Wall street just gave these markets back end distribution channels...they didn't make the loans. Tighten up the ads and the underwriting and the back end capital meets the market need. Period. Done. Finis. I sure hope we can learn from this mess, because if we don't, history will just repeat itself, with higher and higher costs each time.

I am not sure that I want myh bank dealing directly with foreign governments to help them out of their self-inflicted troubles. The projected 700 billion dollars should only go to purchasing the bad debt, not for the salaries of the people that created this mess. I feel this financial crunch just as bad as the next guy. I work for a living as well as my spouse. I have invested in a home and pay taxes. I know of 10 major banks that have closed their doors in the past 6 months. Who is feeling it? The depositors. That means you and me. This is where we may be heading, especially if the banks begin negotiating with foreign governments. Talk about out-sourcing of jobs! I am sure that those governments will take over those insolvent banks if the %age of bad debt is high enough. I don't want another country handling my savings account!

This will not fix the bubble, it will just make it bigger. If we give them this money they will continue to abuse it just as they have been all year long with over 30 billion in "bonuses" to top executives this year alone how can we wonder why they are having problems? By bailing them out we are telling them it's ok for them to make bad deals and over lend to people that cannot pay them back because the government has their back. Well what about the rest of us Americans that made our payments, worked our butt's off to make sure we did not get behind the whole time their over lending has lowered the value of our homes. In the short run the 700 billion might seem like a good solution but in the long run it will cause even worse results. By constantly bailing them out we are devaluing the USD makes every day necessities more expensive for the average working person. This bailout is unacceptable. It's time the federal reserve and the American government stop making decisions for the majority of the American population.

A real solution, let the banks find investors to help them out. You all realize we don't have 700 billion, that money would come from china in the form of bonds. These banks could do the same thing then our government would not be held liable for when they fall on their butt's.

This will not fix the bubble, it will just make it bigger. If we give them this money they will continue to abuse it just as they have been all year long with over 30 billion in "bonuses" to top executives this year alone how can we wonder why they are having problems? By bailing them out we are telling them it's ok for them to make bad deals and over lend to people that cannot pay them back because the government has their back. Well what about the rest of us Americans that made our payments, worked our butt's off to make sure we did not get behind the whole time their over lending has lowered the value of our homes. In the short run the 700 billion might seem like a good solution but in the long run it will cause even worse results. By constantly bailing them out we are devaluing the USD makes every day necessities more expensive for the average working person. This bailout is unacceptable. It's time the federal reserve and the American government stop making decisions for the majority of the American population.

A real solution, let the banks find investors to help them out. You all realize we don't have 700 billion, that money would come from china in the form of bonds. These banks could do the same thing then our government would not be held liable for when they fall on their butt's.

The way I understand this bill, is that the bad debt will be sold to the government. This will cause the lending institutions to have more liguid assets. The government will then resell those bad debts to investors. Who will buy these debts? China? The EU? If this goes outside of the US, it will devalue the dollar. We will then have to pay the debt back with devalued dollars plus the interest incurred.

What will happen with all of those repossessed homes? Until things improve and money isn't as tight, they will stay on the market. Then what? Uban blight? Fire hazards? Dope houses?

Alternatives are few. Paulson was saying that the only people that could fix this problem are economists that have degrees, but the way I see it is that those are the people that put us here in the first place.

The most important point is that this needs to be fixed BEFORE the election. You can blame democrats, you can blame republicans, but when the rubber meets the road it comes down to the longer we wait the deeper the problems become. Pass the bill, but make it so that amendments can be made to it as needed. Nobody seems to know what will happen because there are so many scenarios. We need flexible, adept leadership. Not people that contribute to the problem like the people that took money from Fannie Mae and Freddie Mac . That list includes both Democrats and Republicans. No one is really clean. Let's find some REAL leadership! In crises, you find out who REALLY has leadership skills.

I love the Birk plan. Sign me up.

Perhaps any bailout help any institution can get should be discounted by the amount that they have paid their CEO???s including any Golden Parachutes and the benefits that they receive so at least we aren???t paying for the outrageous compensation that no human can possibly deserve.

I also think we need to look at a different method of keeping things in check. We have already seen the results of deregulation; the greed of those in charge of these companies knows no bounds, and yet those at the bottom, even in the companies needing bailout, have to live on as little as the higher ups can get away with paying. I think maybe we should consider implementing a maximum wage. When the idea was first explained to me some years ago, I thought it was a great idea. The idea being that those on top would have to take those below up with them, thereby closing the gap between the rich and poor. No business will run successfully without those at the bottom, but they rarely ever get the credit, or raises, they deserve. Or if they get a raise, it in no way equals the rise in cost of living. Instead of imposing a minimum wage, have a law that says the highest compensation in a company can be no more than say 25 times the lowest compensation. That is a number I ???m using for example not as a final number. That way when the CEO goes up, so do those under them. We may have to still have a minimum for those in small businesses until the higher ups compensation reaches a certain figure, but it would at least bring some equality into the system and keep those at the top from having run away salaries. Otherwise, the gap between rich and poor keeps growing, and those who do not work for businesses that take a piece of the bailout will have to rein in the outrageous salaries they currently pay. Because we, the people, do pay for those salaries in increased product prices, increased rates for utilities and health care and higher costs in general. Arguably, the President of the United States should be the highest paid individual in the U.S. There cannot be a more difficult job nor one with more responsibility for more people, and yet the presidents salary looks like peanuts compared to most CEO???s. I think it is something worth discussion and relaying to our elected representatives.