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The NY Times had an interesting article about what one calls the $700 billion plan to help financial firms. The White House likes to call it a "rescue plan"--"Financial Rescue Legislation"--while the media has taken a liking to "bailout." (Mayor Bloomberg is also anti-"bailout the term".) But CNBC economics reporter Steve Liesman explained why bailout works, “You rescue the unwitting victims of a boat accident. You bail out an experienced captain who sailed knowingly into a storm. There are no innocent victims here except the American taxpayer. Wall Street, which should have known better, is getting bailed out.” But who knows—if this were presented as a "rescue" plan, maybe it would have gone over better with taxpayers...and the House of Representatives.
Why Media Uses "Bailout," Not "Rescue Plan"
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Lots of celebrating for Egyptian win against Algeria in Bay Ridge.
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Call it whatever you like. Its still highway robbery.
Rome fell, england fell, and thanks to bush the mayans are on target for the 2012 ragnarok.
We're not bailing out Wall Street as much as we're bailing out the credit markets. So the movement of credit screeches to a halt and the Economy Tanks, perfect! (But its not like this plan has a 100% chance of working)
Sometimes politicians shouldn't listen to the voters because the voters aren't always right. The voters act on impulse and are irrational. The founding fathers knew this, and this is why the US was founded as a Republic and not a pure democracy. Congress should do whatever it thinks that is in the best interest of the American people, regardless of what the polls say. Some may say I have too much faith in the gov't. Maybe, maybe not.
"and thanks to bush the mayans are on target for the 2012 ragnarok."
The democrats are up to their necks in this too going back to the Community Redevelopment Act.
Continue seeing this in blindly partisan terms and you will continue to be deceived. Perhaps you noticed, members of both parties pushed for this bail out and members of both also voted it down.
We are all going into the very depths of hell itself, but I am ready the challenge.
Call this thing Tom, Dick, or Harry if you like; it won't change the fact that 700 billion dollars won't solve a damn thing until the underlying causes of the credit meltdown are corrected and I don't see that happening at all.
unrelated to the economy- but what does it mean when a gothamist post does not include an author's name? how is that decision made? is this info somewhere on the website that i'm missing?
just curious- thanks
"Gentlemen, I have had men watching you for a long time, and I am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter, I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I intend to rout you out, and by the eternal God, I will rout you out."
- Andrew Jackson, 1836
But its not like this plan has a 100% chance of working
In fact, no one has any idea at all what chance it has of working... or even if what chance it has of not being worse than any other alternative. There are others, including just letting things ride at least for some time to evaluate exactly where we are.
Sometimes politicians shouldn't listen to the voters because the voters aren't always right. The voters act on impulse and are irrational.
Wait... were you trying to say that politicians and voters are different from each other? You lost me somewhere.
The media uses "bail out" because nobody wants to rescue a bunch of greedy scumbags.
The problem is that "Main Street" voters haven't seen the immediate effects of the credit crunch and don't understand that the freezing of the credit markets will result in real consequences on their daily lives. Prices will increase as banks stop loaning money to businesses as companies have to cover their own expenses. The cost of mortgages will rise. The cost of credit cards will rise. Small businesses will not be able to pay their employees using lines of credit in slow months. People will not buy new homes, and those going into default will abandon their homes, shrinking the local tax base. A shrinking local tax base means decreased local services, including garbage pickup and education, which means an increase in tax rates for people remaining in those neighborhoods. Increase the tax burden on middle-income and paycheck-to-paycheck "Main Street" and the cycle repeats itself. While the rescue package/bailout should definitely include consequences for the banks that got us into this mess (e.g. limiting executive compensation, increased regulatory oversight of the derivatives markets), something needs to be done.
I love it. The news agencies are all discussing why this is necessary. They say things like, "people can't get loans for cars or housing loans. Small businesses can't get credit for payroll."
WTF?!
What ever happened to cash and carry? Why does everything seem to rely on money people DON'T have?
Believe me, I am well aware of the fact that much, much smarter people than myself are working to make things work, and god bless them for it. But the basic things even fail to make sense to me.
I'm not saying we aren't a nation that relies on credit, but would it be such a terrible thing if we lose that ability at least to some degree?
IS money even money anymore? Or just a bunch of IOUs?
Ok politicians are LESS irrational then the people, usually...sometimes.
"The problem is that "Main Street" voters haven't seen the immediate effects of the credit crunch and don't understand that the freezing of the credit markets will result in real consequences on their daily lives"
Bingo. I agree.
This is an excellent explanation of why the bailout isn't best:
http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html
Great quote, Tingo. When will we freakin learn.
Really, people, the only reason this is held up is that every incumbent is pissing his pants before election day. If this were December, Paulson would have received his blank check with a pat on the head and a 'fare thee well'.
Some silver lining in this cloud: dropping oil prices are taking the steam out of Russia's economy and may dampen their saber rattling for a short while.
#4- yeah you are one to give advice on seeing things in blindly partisan terms.
Our tax dollars should not go to crooks who bang tax payers in the ass.
mihow wrote:
WTF?!
What ever happened to cash and carry? Why does everything seem to rely on money people DON'T have? While I see where you're coming from, there hasn't been any point in the recent past that people bought homes with cash up front.
I'm sick of this Main street doesn't get it crap.
No, we get it. We get that this bailout is going to create a huge financial opportunity for Wall St.
We would rather take our chances with "Financial Armageddon" than give bankers the money they need to get the sunroof option on their Maybach.
Re: credit to make payroll, here's an example-- a small business provides a service to clients and asks them to pay within 30 days. The clients don't (and don't pay for months, even), and therefore the business needs the line of credit to float for a month or too - paying employees, rent, etc. I do not think small businesses want to rely on a line of credit, but that's the unfortunate reality when businesses depend on each other.
Jen- what happens when that account receivable never comes in and your client defaults on the payment? do you suggest the business take another line of credit out? and then another when the next client is 30, 60, 90 days late?
This bailing out the Democraps Bill. They caused this. Why are they not being hualed off to jail. And Obama got his finger prints all over this mess.
@Pull My Finger:
Explain how in no less than 150 words, or I'll be forever convinced you're just a Gorilla who learned how to type and smoke cigarettes.
Even without this Bailout bill, the Federal Reserve and the Treasury can still take over & bail out banks that are about to fail. When the FDIC fund to protect accounts runs out, all they have to do is go to the Treasury for a replenishment without congressional approval. The Fed has been pumping hundreds of Billions of dollars into the system to help 'lubricate' the credit markets for months now. They don't need permission from Congress or the Voters to take these steps.
They already have a vast array of tools authorized by Congress to help deal with the crisis, but if the Head of the Fed and the Treasury testifies before Congress that these tools are insufficient to help stem the current crisis, something has to be done. Taxpayers money will have to be spent anyway.
If the plan is passed (And it WILL pass eventually), the government could actually make a profit when these securities and funds are sold back into the market.
Yeah make a profit and piss down a rat hole again.
Know someone who works on Wall St?. BASH THEIR FVCKING BRAINS IN and do the world a favor!!!!!!!!!!!!!!!!!!!!!!!!!!!