Thread: Why are the politicians talking about $700 billion?

hey I am young (19) and I know what the hell they are talking about.

I wouldn't necessarily say that America has been sold. Its more of a combination of issues. Fast and loose lending policies...coupling with the busting of the housing market bubble, gas prices, and banks failing due to sketchy lending practices and lack of government controls.

Lots of stuff coming together. Hell we were due for a major panic anyway.

Originally Posted by ebaconjr

A few days ago Laggy manned up and told me that I was talking above your heads. What Laggy did is what men do. They call each other out.

Most of you are young and don't understand why the politicians are talking about $700 Billion dollars. Here's what's going on.

America has been sold and our politicians are trying to buy it back. I'm not kidding. If I'm wrong then someone please call me out.

No, you're right. Although, quite ironically, they're going to be buying it back with money essentially owned by foreigners. It is to laugh, but not in that haha funny sense, more in the "wtf I don't know how else to react" sense.

The problem, simply put, is that finacial institutions are so heavily indebted that they can't or won't extend credit anymore. The simple answer is to just let them fail. That is not an option. The Fed and treasury are not kidding when they say this is serious. Most in government agree. Where they differ on opinion is on details such as outgoing executive compensation and regulatory oversight.

I, for one, believe that any company whose illiquid assets are purchased should have to give an equity stake to the government (taxpayer) so that there is a good chance of us being paid back. I also believe that any outgoing execs should not recieve golden handshakes mainly as to serve a lesson to future wrongdoers. Lastly we must regulate. It's better to have a little too much brake than a runaway car. The notion that markets will figure it all out has been proven wrong. The core pillar of capitalism is greed. Left unchecked you get what we currently have.

what i know for sure is the economy will get going again, may not be soon, may be in a few years but soon enough it will go on an upswing, it always does (Then goes to shit again later)

Originally Posted by triggerhappy2005

The problem, simply put, is that finacial institutions are so heavily indebted that they can't or won't extend credit anymore. The simple answer is to just let them fail. That is not an option. The Fed and treasury are not kidding when they say this is serious. Most in government agree. Where they differ on opinion is on details such as outgoing executive compensation and regulatory oversight.

I, for one, believe that any company whose illiquid assets are purchased should have to give an equity stake to the government (taxpayer) so that there is a good chance of us being paid back. I also believe that any outgoing execs should not recieve golden handshakes mainly as to serve a lesson to future wrongdoers. Lastly we must regulate. It's better to have a little too much brake than a runaway car. The notion that markets will figure it all out has been proven wrong. The core pillar of capitalism is greed. Left unchecked you get what we currently have.

Giving (meaning, the Gov't taking) an equity stake in companies to the gov't in any circumstance is a REALLY slippery slope toward socialism. If thats the acknowledged goal of some Americans, so be it, but I want to make sure everybody knows what we're talking about when we discuss the Gov't taking ownership of private companies.

Regardless, I dont think its as simple and cut and dried as Bacon put it "America's been sold and we're buying it back" - That's sort of what's going on...but what its more like is "America went to college and spent its tuition on porn and beer and now needs a loan from its parents to pay the bills."

We bought stuff we couldnt afford, banks gave risky loans with little guarantee or underwriting, there was a push from the left toward more home ownership and a push from the right to realize the capitalist dream, and in the mean time, if I bought a Million dollar house I couldn't afford, the worst thing that could happen is that I get forclosed on and get my credit wrecked and then I rent an apartment...what I should have been doing anyway...To the lowest of the low, there was no downside to riding one of the ARM loans out and rolling the dice...

The American DREAM is a house with a white picket fence, 2 kids, 2 cars in the garage and a chicken in every pot.

The operative word is DREAM...not right or reality...

As I read all of the posts on this subject, I realize that almost all people don't understand what's going on. Last night, during a discussion with my economics girl, the situation came to light in my head.

The government is securing the retirement funds of millions of americans. You see, alot of these retirement funds disappeared. It's not because the companies screwed up. It's because of a combination of two things. People not being able to pay their mortgage, and people pulling their money out of real estate investments through companies like fidelity. People are pulling their money out of real estate investments in their 401k because the return is staggering due to people having trouble paying their mortgages. All of a sudden, a slow decline in money starts and then the dominoe effect takes over and every single person who has 401k or an IRA account removes their money from real estate because why would you want your money in an account that won't produce a return. The money that was disappearing are the retirements funs of millions of americans. Some of these folks spent decades saving money thinking that they would have a million dollars to live off of. Instead, they have like half that now. America is helping our old people and their future, you can't argue with that.

Originally Posted by Muqtar SGT_Clintok

At this point, principles kick in. To me, if you sign up for a mortgage that you can't repay, you are a gambler/foolish/stupid. I live in a neighborhood that is below where I want to live. I live there because my wife and I bought a house that was about 1/2 of what I qualified for. I did this because I wanted to be certain I could afford it, even if I lost my job or something bad happened.

One thing to consider is that when the people signed up, they could pay, then living costs increased, water, electric, food, etc. Also, if you lose your job, you can't repay, and in texas I think I heard something like 30% increase in unemployment. That will effect alot of mortgage accounts. When that many people can't pay, the real estate investments are going to disappear because people are affraid.