In a stunning 228-205 vote, the $700 billion bail-out package fails to pass Congress. The Dow Jones industrial average has fallen over 700 points. Investment bankers and stock brokers jumping out of windows next? Who knows.
This whole debacle reminds me a bit of the Wizard of Oz, with Paulson and Bernanke playing the role of the “smoke and mirrors” dependent wizard, President Bush the brainless scarecrow, Congress (particularly the House of Representatives) in the role of the gutless lion and House Speaker Nancy Pelosi playing the Wicked Witch of the West. Plenty of blame to go around fellas.
One fact remains clear. If Congress doesn’t pass something soon, everyone will, for better or for worse, get to see just how much Wall Street and Main Street are tied together.
Logged in “Korean Economy” because it doesn’t take a rocket scientist to know that a recession in the U.S. will certainly affect Korea.
UPDATE:
- Looks like the law makers are giving it another try…
- Conservative representatives remain the stanchest opponents to the bailout plan (in its current form)…
- Economic uncertainty is appearing to help Obama more than McCain in the polls…
Historically, voters tend to shift Democratic when the economy wobbles. Question: this being the case, why are House Republicans creating more economic uncertainty?
{ 102 comments… read them below or add one }
There was no guarantee that the bailout package was going to certainly work in the first place.
The roots of the problem, or foundation of the house of cards goes beyond your kindergarten metaphor friend. We have a world monetary system since Bretton Woods based on thin air, and in America, it is guided by a secretive non-government cartel called the Federal Reserve.
The unwillingness of congress to throw an unprecedented amount of money which does not exist can only be natural. If you see how much of big government money gets wasted, look no further than every public project since WW2.
Perhaps, this is the kind of Darwinian crucible needed to thin out the herd and bring equilibrium to the world. There is a price for speculative greed, and yes, sometimes you lose. Shocking I know.
As for any American recession affecting Korea: Who cares? Since when have they had a normal economy in the first place? When was the last time that public believed in honest hard work, not monetary rookery/real estate speculation? Talk about a house of cards, look at Seoul, an entire metropolis based on money almost no one has. Again, perhaps a culling of the herd is necessary, a nice recession to smack everyone back to reality.
Almost 100% behind your statements ICK. However, I think much more of the Seoul real-estate market is owned outright than in the US. 전세 usually equals 50% of the buying price doesn’t it? So that’s another sizable chunk of the market with a substantial amount of real money behind it.
Hello recession, goodbye Second Great Depression. Hats off to the congressmen who opposed this bailout, like Congresswomen Marcy Kaptur:
http://kr.youtube.com/watch?v=oAADyc6t4nY&eurl=http://libertyvsleviathan.wordpress.com/
Sure, the speculative greed of diligently saving into your 401(k) account must be punished indeed. And how dare people buy into mutual funds that never broke the buck since 1970s in the throes of their speculative greed?
I’m not pleased about the bailout, but the collateral consequence is too great. How about some empathy for people who would lose a ton through no fault of their own? Al Gore’s “lockbox” idea never sounded better…
Something will pass as “main street” realizes that their access to credit has dried up. No cars, no payroll for small business. No college loans for the kids etc etc.
ICK is right. Its, ALMOST, always been a house of cards. i just wish it had waited a few more years.
The next fews days will be a bloodbath and main street will be shocked at the damage done to their 401K’s and IRAs etc.
A deal will be done by Friday.
If not, that Buddhist monastery in Thailand is looking awfully good right now.
Though the shaved head and no sex poses a problem.
“Hello recession, goodbye Second Great Depression”
> Couldn’t agree more. Get it over with in 2008, please don’t ruin things all the way until 2018.
“One fact remains clear. If Congress doesn’t pass something soon, everyone will soon see just how much Wall Street and Main Street are tied together, for better or for worse.”
> Wangkon – you are a schmuck. Government is the problem and the sooner they get out of the way of the economy the better off we will all be.
> Wangkon – sorry for that – you may be schmuck, but you are not as big a schmuck as GWB.
The bailout will get us this;
http://en.wikipedia.org/wiki/Japanese_asset_price_bubble
No bailout will get us this;
http://en.wikipedia.org/wiki/Savings_and_Loan_Crisis
I’ll take 2-3 years of recession as opposed to a decade or more of stagnation.
iwshim,
Please do tell… where did you get your economics degree from?
@7,
same place where Phil Gramm got his degree.
If I don’t get a hat tip this time, I’m walking and I’m taking cm with me. We’ll start our own blog and we’ll give hat tips to anyone who walks in the door.
http://www.rjkoehler.com/2008/09/26/commitment-to-asia-strong-aig/#comment-194940
Admit it, Wangkon, if I hadn’t linked this five hours ago, you would’ve never heard about it!
U-81,
I tire of your constant need for recognition regarding HTs for no-brainer front page news items…
@ 8, re: Phil Gramm…
http://townhall.com/Columnists/RichLowry/2008/09/22/is_phil_gramm_to_blame
Also, Phil’s economist is probably Wendy Gramm, his wife and also a Korean American. She got her PhD in Economics from Northwestern University. However, when Phil get’s blamed for economic messes, that blame get’s transferred (right or wrong) to Wendy.
http://flickr.com/photos/9106303@N05/2685177018
I tire of your constant need for recognition regarding HTs for no-brainer front page news items…
Sorry Wangkon. I thought it was obvious I was kidding (and that’s not a dig). I’ll go back to using winky faces.
(But I think some of my previous acts of recognition neediness were for news items that weren’t necessarily on the front page.)
This is how a deregulated free market works folks. Just a shame the whole world is going to pay for America’s fuck-up.
Oh well, on the bright side this should help finally to get the Republicans out of the White House. Then America can have eight years of trying to recreate financial stability and finally running a surpluse again, only for the Republicans to run an anti-gay, anti-abortion hick who gets in with social conservatives’ support and messes everything up again.
As for a non-existant $700 billion – I wonder how much the war in Iraq has cost?
The Clinton “surplus” was never a surplus — while public borrowing went down, intergovernmental borrowings rose substantially during his term in office. In other words, swelling collections of FICA tax, which is supposed to be in Algore’s “lockbox”, were spent on Treasury bonds and squandered during the Clinton administration.
The really great news is, those baby boomers will start to retire soon and then the young get to support them with greatly increased FICA.
Clinton did reduce deficits during his term, but never eliminated them. His claim otherwise is, well, typical Clinton.
God what a f*cked thing to wake up to this morning.
I’m no fan of Pelosi but I listened to her speech, and her extemporaneous comments stated nothing more than the obvious. The Bush administration is incompetent. The sky is blue. That makes her a “witch”? Hey, that’s sexist
The Dems are at fault for def;ecting regulation of Fannie and Freddie, and the Repubs are to blame for the Wall Street gluttony. Paulson has millions waiting for him at Goldman Sachs that come out of the same practices he is now decrying. He should do jail time.
And Ya Bum Suk, how much will the Iraq war cost? The WaPo estimates it will be TRILLIONS of dollars:
http://www.washingtonpost.com/wp-dyn/content/article/2008/03/07/AR2008030702846.html
Looks like the US has gone tits up just yet. The US dollar has edged up a cent against the Canadian dollar since yesterday.
Bullshit. This is how an overregulated “free” market undergirded by fiat money works.
Subprime collapse? Housing bubble? Read up on the Community Reinvestment Act and the 1995 changes pushed through by the Clinton administration.
This much I agree with. Bretton Woods II, making fiat dollars the world’s reserve currency, amounts to an international economic suicide pact.
Did Nancy Pelosi, as SPEAKER of the HOUSE deliver a great speech to ensure Republican cooperation?
Do the Republicans CONTROL the house?
Did gyopos support Phil and Wendy’s Presidential runs at any point in time?
No, No, NO !
Where is Pelosi’s legacy?
She’s been around as House majority leader long enough to have a lasting legacy as the most powerful woman in US history.
Seriously, what has she done?
Why is she dodging any responsibility?
Her role was to counter the “evil Bush”.
Deny it?
So, how productive was she? Please tell me of her legendary accomplishments.
NONE !
All she did was slow down Bush’s good moves.
face it,
wjk will open your eyes.
Nancy Pelosi = Son Hakgyu.
Barack Obama = Noh Moohyun.
wjk, the observer.
Kind of strange that the bail outu proposal never called for owners of the financial institutions to be held accountable. Remember how the IMF insisted on debt equity swaps for workout firms? Bad loans were turned into new shares and the shares of existing owners were diluted. Most lost ownership when the government sold off shares, and new management came in. The US plan basically called for a straight subsidy to the industry, not only unfair, but an incentive to engage in even more risky lending. No wonder it failed to pass? The Treasury Dept should take its own advice next time.
wjk who can’t help but post several times in a row… can you please take a few seconds to compose your thoughts before mindlessly typing?
I find the whole process really interesting. Paulson’s first plan was pure Bush-ism: kinglike power concentrated in the hands of one man, irreproachable, unquestionable and arrogantly condescending; all the dire warnings of the Bush era “Do what I say now or you will all burn in the fire of Islamic fury – oops, I mean economic apocalypse.”
Sick of 8 years of this shit, 150 of (mostly) America’s top economists wrote a letter to Congress telling them it’s exactly what dokdoforever described (the latest version was improved somewhat, giving the government warrants on the banks). Sick of 8 years of this shit the Republicans revolted, and especially sick of 8 years of this shit, America’s voters flooded their Congressmen with phone calls and emails telling them they were dead if they voted for this.
Because this is such an emergency and time is so short, and because of the election, we’re actually starting to see some REAL in-the-trenches democracy in action in America. And it’s great to see. And I think it’s going to work, although this is going to be a hell of a week. (I haven’t sold my stock, my investments in the NYSE are still there).
Many Americans feel betrayed by Congress and the whole system. For a taste, read this very funny editorial by some guy in a medium-size city in Tennessee, entitled “The Terrorist Federal Reserve Board”:
http://www.chattanoogan.com/articles/article_136029.asp
i think I am sick of Linkd’s shitty brain.
y’all can have some more of it, if you like Linkd.
America has not been attacked, despite the fact that repeating the scale of 911 was a major priority for Islamic terrorists.
Instead, these events took place in London, Spain, Iraq, Afghanistan, Yemen, etc.
Canada has had not a single important landmark or position of strategic value to attack.
You can credit the stars, the moon, the sun, sheer luck, etc, but Bush has protected America.
Seriously, what better death blow to the Republicans than another terror attack on US soil?
Bush has prevented all of this.
Canada is of no value, so it is not going to be attacked, despite New Jersey-esque efforts to protect Canada in process.
If America is New York, Canada is New Jersey.
Gosh, that is too generous of an analogy.
Linkd, “the financial proof reading expert” thinks a bail out is not needed.
Note that, everyone. Canadian finance education and training at its finest.
much like then brilliant NY-NJ example,
Canada’s very existence and importance is an afterglow of the presence of the United States of America.
The jingoism, for a country he appears to not be native to, mixed with the disjointed grammar, train of thought rambling, and incoherent political tirads is fantastic. WJK is a poet of the surreal. I wish he were a troll, it would be the 9th level of troll-fu: TOTAL MASTERY
A++ Would bite the flamebait again
A bail-out is very much required, and I hope, and believe, that one will pass this week. Try to reconcile that with my above comment, fetal-alcohol handicapped child of mental deficiency that makes Palin seem brilliant.
I’m very confused. Maybe someone who has more insight can explain it to me.
Presumably the whips of both parties counted their numbers and then got together to figure out whether they had enough to get the bill passed. They must have talked to one another about this. Presumbaly they reckoned they had enough names and so put it to a vote. Presumably when the votes came back it was pretty clear to everyone who hadn’t managed to get the votes they had promised to get. Then people like Roy Blunt and Eric Cantor come out and say that it was all because of Pelosi’s ad lib speech.
http://news.bbc.co.uk/2/hi/americas/7643080.stm
So does that mean that some 15-20+ Republicans were so piqued at Pelosi blaming the whole thing on Republicans, George Bush, the war, capitalism, Brady’s busted knee and the Indian summer that they went ahead and voted a financial meltdown for everyone? That just doesn’t make sense. “She’s speaking way out of line there, so here you go, have yourself a great depression America.”
Can anyone explain it? Does it mean that something else will get passed reasonably quickly once Pelosi apologizes for calling names?
A bailout is not only “very much required,” it would be a disaster of unimaginable proportions.
The problem has been caused by profligate money and credit creation by the Fed, coupled with government regulations that forced banks to lend to non-creditworthy customers and allowed them to securitize these foolhardy risks.
The solution is to allow the market to self-correct, to allow these bad debts to be liquidated at a fair and realistic price. A bailout, on the other hand, will only delay and compound the inevitable day of reckoning for this irresponsible securitization of risks—while hyperinflating the world’s reserve currency. Great idea there.
A tough year without a bailout or a disastrous decade with one. I know which one I’d prefer.
“Canada’s very existence and importance is an afterglow of the presence of the United States of America.”
As is wjk and his typically moronic comments in relation to most others who post here and what they have to say.
Make of it what you will.
but it was a nail-biter, and even the whips didn’t know how it would turn out. Also, in US politics, party unity isn’t such a lock as it is in parliamentary systems, especially right before an election. There simply wasn’t time, ecorn.
But a bill will pass.
http://biz.yahoo.com/ap/080929/financial_meltdown.html
I think we can have this;
http://en.wikipedia.org/wiki/Japanese_asset_bubble
Or this (Slightly worse, but similar impact as % of GDP);
http://en.wikipedia.org/wiki/Savings_and_loan_crisis
“Most of us say, ‘I want this thing to pass, but I want you to vote for it — not me.”
Bingo Linkd.
That’s why I characterized the Congress as the lion who has no courage in this surreal tale…
You strike me as a neo-Keynesian Linkd.
All I think I know so far, 3 years out of business school, is that there is no one right way to “run and economy”. The truth of that is being played out for the world right now. This isn’t socialism, or capitalism, it’s ‘whatever works-ism’. I hope.
Ooh ooh, I’ll bite your bait, wjk, you idiot. If Canada is New Jersey, then you damn well better remember where New York gets its water from… As the Mississippi dries up and your cities, sink on their water supplies, who will you turn to?
And again, I beg you, post once, concisely and keep focused. You’re becoming more like Pawi everyday…
Linkd,
Your views are more consistent with neo-Keynesian economics in most instances. You are certainly not a Neoclassical economist, but you see its utility sometimes.
Myself? I’m neo-Keynesian from a macro standpoint and a Neoclassical from a micro standpoint… in most regards.
You are right. It’s so hard to deal with absolutes when talking about economics. The best analogy I can think of is the body and how you treat problems with the body. The economy is so complex and so big (in the order of things, the human body is comparatively a big and complex machine) that just one treatment or medicine won’t work if something serious went wrong.
So if you are saying that they put the bill to vote without knowing whether it had a chance of passing that sounds almost worse.
I would interpret the Republicans rushing out to blame the Speaker as an indication they were the ones who suffered the worst “revolt”. Either way, if congressmen aren’t willing to put their name to something that they feel needs to be passed, it’s not a good sign that something will get sorted out soon.
I like McCain’s remark – it’s the Democrats’ fault, but this isn’t the time to be attributing blame.
Now is surely not the time for a politcal meltdown as well as a financial meltdown. The more I think about the bailout plan the more I like it. The problem is that the market is spooked by the structured stuff and no one trusts the valuations. If the govt steps in and starts providing a bid then everyone will at least know where they stand. Putting money into forebearance on mortgage payments isn’t going to help much if the economy takes a dive and everyone loses their jobs anyway. The stuff about executive pay is just fluff. Now is not the time to legislate away the shareholder model.
One thing at a time. First fix the panic. Then fix the banking. Then fix the debt. Then fix whatever else is on your laundry list; executive pay, political croneyism, drugs in sports, string theory…
Yep, that’s the theory. However, the problem with American policy making is that they like to stuff as much crap from day one instead of get something out quickly and make it evolve over time to address evolving problems.
Congress over thought the swing, choked and the ball went flying into the pond…
You CANNOT fix the panic by printing money!
All you do is delay it, and make it worse when people realize that the dollars that they hold are now essentially worthless. Think Weimar Germany.
Meanwhile, the poor and middle class will be disproportionately affected, as their savings will be diluted while they won’t be receiving a cent of the trillions being printed by the Fed. By the time any of the new money makes it down to the consumer level, prices will be too high for it to matter. Talk about trickle-down economics!
That is why I have no faith in their ability to avoid disaster this time. Unfortunately, it is probably time to reap the whirlwind and it is sad that such a destructive purge must take place before Americans wake up and get involved with how things are run.
# 39,
The advantage the U.S. has over Weimar Germany is that the U.S. won both World Wars with its infrastructure intact and its economic and political clout heightened.
It created the framework of the modern international financial system with the creation of the Brenton-Woods System, the World Bank and the IMF. So, what does this mean? Essentially, this means that the U.S. can literally write its own rules in the international financial system. It can print money, sell loads of paper (i.e. U.S. Treasury Bills), deficit spend like crazy and have negative current account deficits ad infinitum AND still have foreigners bankroll them. Amazing…
The rest of the world is jealous America. You are like the skinny hot chick who can eat whatever she wants and not gain weight!
#39. Ut videam, you’re right to be worried about inflation. But the Gov’t (taxpayer) is getting something in return for increasing the money supply. The taxpayer is getting what I expect are increasingly undervalued securities.
The sovereign wealth funds and the solvent hedge funds are probably having a ball at the moment. Things are cheap, they have money, it’s time to go shopping. Look at Warren Buffett, even he’s getting his hands on financial weapons of mass destruction by putting big money into Goldman Sachs.
If the Government were buying up all the mortgage debt and then writing it off, that would be a massive problem, but as I understand, the plan (the plan at least) is to sell the stuff back to the market once things have quietened down. That’s basically saying that there is a negative psychological premium in the prices at the moment which will hopefully go away in a few years. If it does goes away then the taxpayer will actually pocket most of that premium.
It isn’t ideal that the US should be borrowing yet more money to bail itself out, but I don’t think it’s quite as bad as some would make out and I don’t think we’re looking at a Weimar/Zimbabwe type situation…yet….
If you’re not propping the system up, then you’re letting the system fall. If you’re going to let the system fall you might as well shut the whole country down, turn off the lights and move to Canada.
See, here’s what I think might have happened in the House yesterday. The leaders and whips went round and asked everyone whether they were a yay or a nay. Totaling up the yays they thought they had enough so they put it to the vote. Then, some people who said they would vote ‘yes’ voted ‘no’ instead. If I was a senior party leader, party donor or voter, I’d have a real problem with those people.
If you’re going to vote no then you really should be saying so beforehand and what you need to see in the legislation in order for it to get your vote.
Either that or they put the bill to a vote on the basis of a questionable chance of success, hoping somehow that magic would intervene to get it passed.
“Canada’s very existence and importance is an afterglow of the presence of the United States of America.”
Mmm, I guess somebody doesn’t know much about US history.
PS. One of the men responsible for pulling the American economy out of the shitter after the American Civil War was a Canadian. He contributed half his fortune to rebuilding the US, the single biggest contribution to the US government by an individual (or so I read in the papers many years ago). He donated what would amount to billions of dollars today. Can’t remember his name, but I don’t think it was one of the Cunards.
“iwshim,
Please do tell… where did you get your economics degree from?”
My degree (or lack of) is irrelevant to the point. The problem is that government is the problem. The less government does the better we all are.
I propose the United States government do nothing and let the free market solve the current problems.
WangKon what do you propose?
Ten years ago I heard that the advanced economies should do nothing and let Korea learn its lesson even if it means total collapse. Now I’m starting to hear the same thing about the United States. All this makes me want to say, “Bring it on!” Let the markets crumble, let the credit system crash. Let the unworthy be naturally separated from the worthy. Too many people have credit cards they shouldn’t have or homes they shouldn’t have (not just the poor who overreached like wjk says, but the house flippers). Let it all crumble. What’s in it for me? Less credit will mean fewer people buying houses and maybe prices will come down to a reasonable level. 2008 model cars are practically being given away, especially the gas guzzlers. I think I saw a 2-for-1 deal on TV. Starbucks is selling coffee for a buck sixtyfive. Life is good. I don’t care how this all plays out. I don’t own stocks in GM or GE or a home or even a car that I would want to sell. I’ve got a guaranteed modest income so why should I care what happens to a bunch of greedy mofos. Why should I bail them out? Yeah, I’m a cynical mofo but after this bailout I just don’t care. Just don’t touch my Internet and keep playing the Daily Show.
How’s the KRW doing compared to the USD? This might affect travel plans.
Well, this is interesting. Check out NY Times website. After huge drops of up to 5%, the HK and British stock markets have risen back to where they started. Did something happen in the middle of the night in the US? Or maybe they realized that the crisis has been mostly hype? An encouraging sign anyway.
dokdoforever, yes, I was looking at the intra-day chart for the KOSPI and thinking it looks suspiciously like a science student’s lab book. You could almost fit a nice simple monotonic function to it. It looks like someone has been consistently buying throughout the day, perhaps even algorithmically?
this is more pathethic than watching Koreans claiming credit for Japanese affluence.
only in recent years, Canada despite being a satelite nation of US, has decided to be a Europe kko-bong.
I’ve heard of US college students crossing the border to go to Canadian nudie bars, but never the other way around.
i’ve never met a Korean Canadian who failed to admit that it was his 2nd choice.
now comes the racist lines from Herr KrZ, such as
-you are not a native.
-to be followed up with, go back to your country
that’s what I thought, white liberal guy.
user-81
“Ten years ago I heard that the advanced economies should do nothing and let Korea learn its lesson even if it means total collapse.”
You bet! Nothing has changed.
Still stupid same old – same old.
Funny (or sad) thing is that it is the poor that always loose out in systems like this.
#49,
Canada a satellite nation of the US?
You’re a moron. Canada was province of the UK from 1841 until Confederation in 1867. Some one say it remains under British sovereignty to this day despite the Constitution Act of 1982.
http://en.wikipedia.org/wiki/Queen%27s_Privy_Council_for_Canada
As for Canadians not going to American nudie bars…Simple: Our nudie bars are better.
#49,
Canada a satellite nation of the US?
You’re a moron. Canada was province of the UK from 1841 until Confederation in 1867. Some would say it remains under British sovereignty to this day despite the Constitution Act of 1982.
http://en.wikipedia.org/wiki/Queen%27s_Privy_Council_for_Canada
As for Canadians not going to American nudie bars…Simple: Our nudie bars are better.
“i’ve never met a Korean Canadian who failed to admit that it was his 2nd choice.”
Yes, Korea was his first…but given that the Korean educational system has it’s problems…
Those of you who are arguing that we should just let the free market take care of it would do well to recall that what Darwinian selection wants and what human civilization wants aren’t necessarily the same thing. Populating the planet with non-conscious amoeba may be a strong attractor in Darwinian dynamics, but is that really what’s best for humanity?
Take blogging for example. If there wasn’t constant intervention in the free market eventually all comment sections would descend into petty bickering and name calling…
#18
Yes, Clinton signed the act, but, who was in control of the congress and the senate? A rhetorical question, indeed. I’m no Clinton lover but, please, let us be a little less marble-eyed.
It’s a parliament of whores, sorry, bicameral legislature of whores, with more than enough blame to go around since 1977 when the bloody thing was passed.
Our man Bush tried to curtail this in 2003 but I’m not sure it would’ve done much good.
Ahhh….I tire of he people pointing fingers and “Dems” and “Repubs”. This was a monumental fuck up of human greed and fuckupedness and the humble pie will be eaten by all ‘colors’ of political proclivities.
Gee…I hope the won goes down to 1150 like I heard so I can send some money home tomorrow.
Sorry….GWB tried to change it in 2005, not 2003.
I’m sorry wjk, I didn’t mean to imply anything racist. Only that it’s odd to see an immigrant be so hypernationalist. Like seeing an American at a Mad Cow protest.
wjk,
When you are in your sixties and start to feel your body coming apart at the seams, you’ll wish Canada was your first choice…
Balls.
If you have to ask what was your first choice, and you took time to answer, you obviously did something wrong, didn’t you?
I mean, if supporting the current administration and throwing wishcoins at Jesus doesn’t keep you busy, then you’re not going to pass muster. At least at the wjk booth. Who says that only Americans are happy, and probably only because some Koreans had the gumption to be poor and leave the alma mater in search of a new flock to convert.
Recessions and tigers and bears.
Canadians get so defensive when their bizarre little ice-utopia gets attacked.
Poor Canadians, maybe one day you will be able to pronounce a sentence about yourselves that does not contain an explicit or implicit comparison with America, but not today.
gotta love it. it’s all about democracy and checks and balances.
hopefully the rest of the world can learn from it.
bush can’t do whatever the F he wants and just have it pushed through quietly.
and those f*’s that got $500,000 loans while making a yearly income of $25,000 with 3 kids….you shouldn’t have gotten the loan.
banks and financial institutions that were pulling this sh*t should go down.
it’s capitalism. the strong survive. the ones that made wise decisions survive.
yeah, it’s gonna affect the economy. it’s gonna trigger a worldwide recession. but i’m not worried. i know i could afford my home loan and i made wise fiscal decisions. i also have a job and and i know i have to skills to find another one if need be.
it’s democracy dammit.
qui vivra verra.
I feel like I am forced to make this point again, because so many people are harping this selfish point of “Look at those dumb greedy people! Let them burn! I am smart and unaffected by the economy!”
So:
Also, wangkon @59 — regardless of his ignorant talk, wjk will gladly slurp up the national health insurance that the dems will inevitably put into place in the coming administration.
This package was vastly unpopular with the voters of the US. This was true for both Democrat and Republican voters.
News articles in US newspapers report today (09-30-08) that the flood of people against the bailout even overcame the influence of big-money lobbyists.
The people of the US weren’t convinced that their $700 billion dollars were necessary or would be well spent.
One thing that appears to be forgotten in all this is that the Wall Street types manage the money, they don’t own all the money. Sure they get a hefty percentage of that money as a fee to manage the money, but the are essentially managing OUR money. Yep… OUR money through 401ks, IRAs, mutual funds, money market accounts, piggy bank sized saving accounts, etc. That money right now is at risk. Yes, less so if it’s Federally insured, but so much of OUR money is NOT federally insured.
So how does mortgages affect OUR money? You see, OUR money is used as collateral to support debt. That debt is used to acquire assets, who’s value is used to support more debt. This debt is lent to big businesses, small businesses, people looking for home loans, students, etc. Essentially rich people and average people alike. It’s what keeps the economy moving and usually works just fine up until some segment of the economy acts like drunken sailors, goes hog wild and loses all common sense. In this case it was the residential real estate industry and lending money to people who couldn’t afford (and didn’t deserve) property.
We could go back to not relying on debt to fuel economic growth, but then the international economy would have to move back into the Middle Ages. No thank you. If you use common sense about debt leverage, you’ll be fine.
The government is the only party that’s big enough, has enough of a consistent revenue base, and is long term thinking enough to be the effective player to get us out of this mess. Of course it could do absolutely nothing, but then THIS is likely to happen.
Linkd,
I’m sure everybody in Wall Street is a neo-Keynesian now…
It’s like finding God when you are in front of a firing squad…
If I were President, I would declare the economic equivalent of martial law.
First order of business, empower the IRS and FBI to seize the personal assets and holdings of the CEOs of the failed Wall Street banks, including their multi-million dollar golden parachutes and bonuses.
Secondly, sever the link between the virtual economy (financial markets) and the real economy (production) by making credit available to the real economy straight from the federal government for a temporary series of 3 month periods while allowing the financial markets undergo a complete hands-off correction. This is economic quarentine.
Third, establish an investigative committee to identify key players responsible for causing the crisis and hold them to accountability. This would include deregulation champion Phil Gramm.
OR
Congress could give Hank Paulson, a former Wall Street guy, absolute power over hundreds of billions in a bail-out deal and the nation could cross their fingers and hope this isn’t like asking the fox to guard the hen house.
Only that it’s odd to see an immigrant be so hypernationalist.
Among naturalized citizens not that odd.
to THE KOREAN,
you should well know that the core Democrats don’t believe this $700B is “necessary”, and that they believe the govt ought to mail $1000 to $2000 to homeowners instead.
Based on what you describe yourself as, I’d like to share that I was a student of Mr. Cox, Mrs. Heidary.
the core Democrats don’t believe this $700B is “necessary”
Who are “the core Democrats”? The party banners for the presidential election? The Democratic Speaker of the House? The Democratic Senate Majority Leader? The 60% of Democrats who voted for the $700 billion? Which core Democrats do you mean? Your party is the one where 2/3 voted against it.
The MH has three regular gyopo commenters who are in law, finance and medicine. Of these three, one consistently ends up putting his foot in his mouth…
@68,
Thanks for clarifying that. I almost had to talk to wjk if you didn’t intervene.
wk @69,
I just realized… wjk you me are gyopos, and I know what the two of us do for living… does that mean wjk is a doctor? That’s a scary thought. At least that would explain his poor writing.
Just kidding, other docs on the board. Please don’t hurt me.
Thanks for clarifying that. I almost had to talk to wjk if you didn’t intervene.
thekorean, stop making me your bitch!
He claims he’s an internist.
does that mean wjk is a doctor? That’s a scary thought.
I’d be afraid to go to Dr. Wjk. If something were wrong on the right side of my body, he’d think the problem was on the left.
Just so everyone understands the Great Depression was a result of government intervention. Was it not for the policies of government it would never have lasted as long or ruined the dreams of so many people.
Government creates problems in the economy, government exacerbates problems in the economy; government does not solve them.
Enough said, I am preaching to the choir. Most at the Marmot’s Hole tend to be of sound economic thinking and do not buy into the idea that there is a role for state intervention in a free economy.
Again no role for state intervention in a free economy.
Wangkon quit been brainwashed by GWB’s Chicken Little speeches.
Small wonder he wants to take away people’s right to sue doctors.
“only in recent years, Canada despite being a satelite nation of US, has decided to be a Europe kko-bong.”
Mmm…Canada was a province of the United Kingdom until 1867 and a Dominion of the Commonwealth up until 1982 (although the Constitutional Act didn’t remove the title and Canada remains, at least symbolically so, a Dominion (do a search for the Queen’s Privy Council for Canada)). A Canadian, Bonar Law, was even elected as British Premier.
user-81, I only do it ’cause I know you like it.
you can’t read what doctors write, because you lawyers make us write a book for every patient visit on the wards or the clinic. It’s a by product of writing fast as possible, and still be legible to us. There are studies showing that doctors have adjusted by documenting pretty, but perhaps gaming that system. They did this study in the British National Health system. Relates to billing. In my experience, only students write legible, if at all. We can read it, because we know what we are looking for. If you’re looking for captopril, you can make out the scribble c-p-r-l, and make it out. I am a MS4, next year a resident. Internal medicine is where I am headed. Tort reform is not only necessary for our field, but the entire US legal system. You keep ignoring the issue, but I seriously do wonder how you can make every plaintiff a millionaire, decided by illiterate 12 people, and make it a law to cover everyone in the ER, but way underfund it. People die waiting in overcrowded ER’s, from time to time. One died in Texas exactly this way, and is suing that hospital, I believe.
People die waiting in overcrowded ER’s, from time to time. One died in Texas exactly this way, and is suing that hospital, I believe.
How does a dead guy sue?
I tend to think you might be right about tort reform, by we shouldn’t get rid of a system of punitive and actual damages that holds doctors accountable and makes them check themselves for errors.
they’re doing whatever they can to remedy the system. Templates, moving to typed, printed notes, etc. The old guys never learned to type, so they’re resisting. I learned from Mr. Saul. Actually, I learned myself. I just sat in his room and looked at a book.
I guess all those billions of dollars in “lobbying”, which goes under the name bribery and corruption in most other countries, have really been worth it.
The bankers and sovereign wealth funds make a wholly unreasonable demand, your elected representatives make a show of rigorous debate to delude the people into thinking they still have a democracy, then, after enough meaningless posturing and fear mongering, cave in and spinelessly do the bidding of their creditors.
In hindsight, maybe enabling with ridiculously cheap credit and propagating, with religious zeal, a cult of excessive consumption (in all levels and facets of society) in the face of falling incomes, a zero savings rate, reckless levels of household debt, declining education levels, and a bleak long term economic outlook, wasn’t such a good idea.
I liked this post found elsewhere;
http://everydayecon.wordpress.com/2008/09/23/the-savings-and-loan-crisis-the-rtc-and-the-paulson-plan/
I said “poor writing” and wjk thinks its about his handwriting. Wow.
Local indicators:
Koreans call them ‘notes’. It used to be quite common for first-tier suppliers to the chaebol to receive 3 or 6 month notes as payment. If they held the notes to expiry, they would receive the full amount. Often, they took the notes to banks and exchanged them for cash right away, at a discount. Before today, I had no idea that these notes got traded by those sidewalk-huddling money-lenders in Myung-dong. Even though the chaebol issue the notes through state-run banks, the banks do not guarantee payment. Payment ultimately depends on the chaebol coughing up. This whole system has been fading away, as the conglomerates have switched to paying with cash.
So, what we have now is some ajumma wrapped in scarves and warming her hands over a brazier in a public market, saying ‘Fuck no, I’m not going to accept the default risk’ on a top-ten conglomerate. Let’s see…
1. Samsung
2. Hyundai Motor
3. SK
4. LG
5. Lotte
6. GS
7. Kumho Asiana
8. Hanjin
9. Hyundai Heavy Industries
10. Hanhwa
Only possibles I see (yet) are #4, #7, #8 and #10, mostly #7.
Joongang link for above cut/paste segment:
http://joongangdaily.joins.com/article/view.asp?aid=2895480
wow, is the superficial level of your intelligence.
what I write is intelligent and most of all, uniquely stylish.
Democrats are so antsy about the prospect of dropping the ball, that they need propaganda films, just like the old fascist days of World War II, to tell the idiots what to think.
Oliver Stone, news media, univ profs wasting money on useless “studies” to sway public opinion, etc.
that is what wows.
However, Korean Americans, please don’t walk around saying Lee Myungbak “needs OUR support” and go vote for Obama. You’re fundamentally contradicting yourself.
If anything, Lee Myungbak is Korea’s version of Bush.
What a poignant observation.
Only wjk.
I don’t think you’re a doctor WJK, enjoy managing your dry cleaner: your parents are ashamed of you.
“what I write is intelligent and most of all, uniquely stylish.”
Ummmmm… I’ll give you unique.
If anything, Lee Myungbak is Korea’s version of Bush.
That’s insulting to LMB. How dare you…
you know, KrZ, that is still very racist.
You wouldn’t call a blazing liberal like bumfromkorea to go back to his dry cleaners, right?
what on earth makes you think a college degree + gyopo to man a dry cleaners? Just generalizing and being racist about Koreans, point blank, that’s what.
Oh, I can’t be “Republican”, because I’m an immigrant?
there are two levels of being educated. Tier 1 is the blazing liberal stage. Stage 2 is when you realize that the “program” is a waste of money, violates your rights, and “accomplishes” at your expense.
You gyopos are striking out every opportunity for LMB to fix Korea in US soil. For what? Abuse of US govt resources to free load fund your halmuhnee’s? Amazing. No matter how hard times are, you have your ass warms up a Toyota, not a Hyundai.
Oh, we know what you are, KrZ. Illicit drug dealer, waiting for another chance to enter Korea. Stay home and let the DEA correct you.
and Lee Myungbak is Korea’s Bush.
Foreign policy towards North Korea. No free pie.
Economic policy. Tax cuts.
Trade. All for free trade agreements.
Govt employees. Down size on govt employees.
Public opinion on LMB. Fascist dictator.
CM, you are probably the most ignorant, stupidest, hypocrite I have yet to observe.
How on earth you manage to be socialist in Canada, criticizing Bush of US, not even your hometown, and praising Lee Myungbak, I have no idea. Even calling for military fascism to control the press, etc.
Bush was never a fascist. Tell me when exactly he had any sort of puppet master hold on the US press. When?
That’s what I thought.
If you want the Truth about the Wall Street bailout deal, dont listen to McCain or Obama. Dont read the NYTimes or the Wapo, or the National Review.
You need to hear Ralph Nader, who has ALWAYS stood OUTSIDE the system.
http://www.youtube.com/watch?v=S7aC7CyOP0Q&feature=user
http://www.youtube.com/watch?v=R3iimehONPc&feature=user
I still don’t think you’re a doctor, drop your IRL info to convince me.
This is really going to piss off a lot of European voters. You know that every politician who speaks in favor of it and who votes for it will say loudly and repeatedly “The Americans forced this on us – we have no choice, it’s all the US’s fault…”
It’s on:
http://www.guardian.co.uk/business/2008/oct/02/creditcrunch.marketturmoil
Just a sidenote : Myeongdong is hometurf to some large loansharks, some of whom you can sometimes see being driven through its narrow streets in large Mercedes-Benz or BMW sedans.
#92, NetizenKim, why does Nader think that the stock-holding executives who have an interest in cooking the books to inflate the value of their holdings can somehow be curtailed by giving power back to shareholders? Do the shareholders not gain if the books are cooked? How do the stock-option-holders gain while the stock-holders don’t?
As far as I know, people like Paulson own mostly stock anyway, not options. According to Forbes he owns 0.92% of Goldman Sachs.
What does he mean by capitalism will never bail out socialism? Does he mean capitalists won’t pay their taxes?
Also, how is he going to distinguish speculators from investors for his security speculation tax? “Mrs Jones, you’re speculating on the stockmarket, you have to pay the tax. Mrs Smith, you’re OK, you’re just investing in the stockmarket.”
I’ve probably done this a few times in the past myself, but he has a fourth proposal, giving the Fed and equity share, and a fourth proposal, creating a security speculation tax.
You must log in to post a comment.
{ 2 trackbacks }