The Conservative Cave
Current Events => Breaking News => Topic started by: Hawkgirl on September 24, 2008, 06:55:42 PM
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Great Article from Newt
Sunday, September 21, 2008
Before D.C. Gets Our Money, It Owes Us Some Answers [Newt Gingrich]
Watching Washington rush to throw taxpayer money at Wall Street has been sobering and a little frightening.
We are being told Treasury Secretary Henry Paulson has a plan which will shift $700 billion in obligations from private companies to the taxpayer.
We are being warned that this $700 billion bailout is the only answer to a crisis.
We are being reassured that we can trust Secretary Paulson "because he knows what he is doing".
Congress had better ask a lot of questions before it shifts this much burden to the taxpayer and shifts this much power to a Washington bureaucracy.
Imagine that the political balance of power in Washington were different.
If this were a Democratic administration the Republicans in the House and Senate would be demanding answers and would be organizing for a “no†vote.
If a Democratic administration were proposing this plan, Republicans would realize that having Connecticut Democratic senator Chris Dodd (the largest recipient of political funds from Fannie Mae and Freddie Mac) as chairman of the Banking Committee guarantees that the Obama-Reid-Pelosi-Paulson plan that will emerge will be much worse as legislation than it started out as the Paulson proposal.
If this were a Democratic proposal, Republicans would remember that the Democrats wrote a grotesque housing bailout bill this summer that paid off their left-wing allies with taxpayer money, which despite its price tag of $300 billion has apparently failed as of last week, and could expect even more damage in this bill.
But because this gigantic power shift to Washington and this avalanche of taxpayer money is being proposed by a Republican administration, the normal conservative voices have been silent or confused.
It’s time to end the silence and clear up the confusion.
Congress has an obligation to protect the taxpayer.
Congress has an obligation to limit the executive branch to the rule of law.
Congress has an obligation to perform oversight.
Congress was designed by the Founding Fathers to move slowly, precisely to avoid the sudden panic of a one-week solution that becomes a 20-year mess.
The Rest Here (http://corner.nationalreview.com/post/?q=ZGE5MmE0YmRiODA3YTRiNzFlN2FmNDU5N2I0ZDc3YTE=)
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It his best since 9/11 -- straight, fact-based, analytical and a good synopsis of where we are and where we need to go.
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
Then you don't understand the problem.
Do you pay cash for everything? Your house? Your cars?
Do you know about M0/M1/M2, etc.?
Credit makes the workd go round. And it is based on confidence. If everyone called in their chits at the same time, the global economy would collapse.
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I'm against government bailouts (of course), but I am reading a lot of people that I have always considered to be brilliant as far as the economy goes saying that this could be catastrophic if something isn't done.
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Excellent article! I'm spreading that one around.
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and politically speaking, now obama will officially be part of the "solution", should it come. and THAT will pretty much rip the "great depression" issue away from him on the campaign trail. how can we have a depression, when he was one of the ones that just helped fix it? I assume that he will try to take credit for it, of course. :whatever:
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I'm against government bailouts (of course), but I am reading a lot of people that I have always considered to be brilliant as far as the economy goes saying that this could be catastrophic if something isn't done.
This is lynchpin time. I agree and I am very leery of Government involvement, but this time we need it.
And, as Bush said, these will be investments that, in the long run, should provide a profit. We, the taxpayers, made money on the Chrysler "bail out."
This is a question of time and cash flow -- the Feds have both.
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^WE, you have exactly 10000 posts now! :-)
Okay, back to the topic at hand....I hate the idea of taxpayer funded bailouts but I know something must be done. America functions best with her back against the wall. I have faith that we'll pull it together. I believe in capitalism and think we'll survive. It may be ugly for a while, but we'll get there. People do need to remain calm though.
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^WE, you have exactly 10000 posts now! :-)
Okay, back to the topic at hand....I hate the idea of taxpayer funded bailouts but I know something must be done. America functions best with her back against the wall. I have faith that we'll pull it together. I believe in capitalism and think we'll survive. It may be ugly for a while, but we'll get there. People do need to remain calm though.
that $700B price tag is way higher than it will ultimately turn out to be. the second the legislation is in place, all of those mortgages are instantly worth more money (than the next to nothing that they are worth now). I hate the hell out of this, but I will choose it over a catastrophe . . . this time.
(heh. I saw nine thousand something this afternoon, but didn't think a lot about it. :-))
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^WE, you have exactly 10000 posts now! :-)
Okay, back to the topic at hand....I hate the idea of taxpayer funded bailouts but I know something must be done. America functions best with her back against the wall. I have faith that we'll pull it together. I believe in capitalism and think we'll survive. It may be ugly for a while, but we'll get there. People do need to remain calm though.
that $700B price tag is way higher than it will ultimately turn out to be. the second the legislation is in place, all of those mortgages are instantly worth more money (than the next to nothing that they are worth now). I hate the hell out of this, but I will choose it over a catastrophe . . . this time.
(heh. I saw nine thousand something this afternoon, but didn't think a lot about it. :-))
That is only $70,000,000 per WE post.
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Just got free to watch the speech, and it's almost 40 min after it started...
Anyone have a good synopsis? I hope he covered a few important points:
- This isn't a bailout of companies, but of questionable debt.
- We're getting something for our investment. It may not be worth as much as the actual investment, but it's better than $0.00.
- Some people will lose their houses, but it won't be enough to set off a "death spiral" of decreasing home values -> more upside-down mortgages -> more mortgage defaults -> decreasing home values... etc.
- Congress failed to properly oversee FNMA and FHLMC, and the regulatory changes in the 90s were a disaster.
In order to get Congress working, he may have needed to soft-peddle some of that. But I hope he covered it well. Bush has always been at his best when he speaks plainly, and I hope he did that as well.
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that $700B price tag is way higher than it will ultimately turn out to be. the second the legislation is in place, all of those mortgages are instantly worth more money (than the next to nothing that they are worth now). I hate the hell out of this, but I will choose it over a catastrophe . . . this time.
I would like that to be the case, but this is the Government were talking about. Frankly, If this only goes 30% over projection, we will be doing well.
Yes- I expect this to end up costing a trillion bucks when its all said and done.
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^me too. Ouch. Our grandchildren will shudder when they read about this time in our lives.
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^me too. Ouch. Our grandchildren will shudder when they read about this time in our lives.
It is an investment, not a bail out. It may even out-perform 1:1.
The grandkids will be too busy being pissed off paying for the Ponzi scheme known as SSI.
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^me too. Ouch. Our grandchildren will shudder when they read about this time in our lives.
It is an investment, not a bail out. It may even out-perform 1:1.
The grandkids will be too busy being pissed off paying for the Ponzi scheme known as SSI.
Let's hope. Some of these congresscritters can eff up a free lunch. I'm double checking the fine print on anything they pass.
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
Cash flow.
Virtually all business incorporates debt instruments to even out the cash flow as its impractical to wait on receipts. Lines of credit are most common. Money out, money in and over time its even. If its allowed to go uneven or even if credit tightness occurs to where cost of cash is over plan, its bad news. Think Jimmy Carter's stagflation.
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Freedumb, oh I get it. You'll never know just how much I "get it". My ex is a Real Estate broker/ agent. My current situation is a direct result of the collapsed real estate market. However, I'm doing as much cash transactions as I can and avoiding credit like the plague. Apparently I wasn't real clear, but when Bush said that we need to get this fixed in order to get on with our daily lives, that meant to me more than the house and car payments, suggesting it goes much further than those.
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I'm against government bailouts (of course), but I am reading a lot of people that I have always considered to be brilliant as far as the economy goes saying that this could be catastrophic if something isn't done.
This is lynchpin time. I agree and I am very leery of Government involvement, but this time we need it.
And, as Bush said, these will be investments that, in the long run, should provide a profit. We, the taxpayers, made money on the Chrysler "bail out."
This is a question of time and cash flow -- the Feds have both.
The Govt also made money on the savings & Loan bail out.
The Money infusion isn't nec a bad thing. The Changes to the Financial Mkts or how they operate may or may not be so good.
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Text of President Bush's speech on economic crisis (http://ap.google.com/article/ALeqM5iBAo1yCOOLr02NJfYtgrYmyZQKxAD93DF2T02)
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I think I understand it, but I sure as heck don't like it. I don't trust a single congresscritter or President Bush either. Somebody got real real rich off the backs of the American Taxpayer. They all suck.
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Call me crazy, but I like Newt's ideas better. Especially the part about no capital gains tax...
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This article explains:
1. the structure of the financial mechanisms that failed
2. the klaws that exacerbated the situation
3. how the bailout doesn't really bail anything out, it resets values for tangible properties that the market is currently unable to assign value to.
4. how the dems plan on seizing even more of the economy under the radar
http://biglizards.net/blog/archives/2008/09/democrats_try_t_1.html
h/t: Ace of Spades HQ
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This ain't funny but it is funny.
The world hates us because of our wealth. We use to many resources. We spread to much influence blah, blah, blah. Our economy has a bad case of the hic-ups and the world panics. Now they expect us to bail them out.
I lived my life as a "pay-as-you-go" citizen and saved the money that others have barrowed. Why should I be expected to bail them out now when I'm about to lose my ass?
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
Then you don't understand the problem.
Do you pay cash for everything? Your house? Your cars?
Do you know about M0/M1/M2, etc.?
Credit makes the workd go round. And it is based on confidence. If everyone called in their chits at the same time, the global economy would collapse.
Exactly. Businesses work off lines of credit for restocking, payroll, inventory, rent, you name it. Actually shutting down credit will screw everyone, and Joe Sixpack will get screwed a damned sight worse than the bankers in the deal.
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This ain't funny but it is funny.
The world hates us because of our wealth. We use to many resources. We spread to much influence blah, blah, blah. Our economy has a bad case of the hic-ups and the world panics. Now they expect us to bail them out.
I lived my life as a "pay-as-you-go" citizen and saved the money that others have barrowed. Why should I be expected to bail them out now when I'm about to lose my ass?
+1
I took 8 years to get a 4 year degree, because I worked my ass off during that time, and would not take student loans, government "grants" or any other handout to pay for my own education.
My vehicles are paid for because I paid cash for them at the time of purchase. I do my own maintenance on them.
My home is the only thing I have on credit - 4 years into a 15 year note - and even that had 30% of the sale price plunked down in cash by me when we bought it.
I gave up on credit cards about 8 years ago as being more trouble than they were worth. I cut them up then; and nowadays, when I need to rent a car or book a flight, I use the standard issue debit card connected to my business account. It works wonders for paying all my bills online, and the nice thing is, when I'm out of spending cash, I STOP SPENDING!
My father in law is much the same way, and the last time he looked at his credit report/score, it was "hideously" low, simply because he had very little credit history.
I have very little use for credit. If for some reason someone were to revoke my credit and reposess my house, I'd quietly go back to renting a house for my family. But I refuse to go through life beholden to sombody else.
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This ain't funny but it is funny.
The world hates us because of our wealth. We use to many resources. We spread to much influence blah, blah, blah. Our economy has a bad case of the hic-ups and the world panics. Now they expect us to bail them out.
I lived my life as a "pay-as-you-go" citizen and saved the money that others have barrowed. Why should I be expected to bail them out now when I'm about to lose my ass?
+1
I took 8 years to get a 4 year degree, because I worked my ass off during that time, and would not take student loans, government "grants" or any other handout to pay for my own education.
My vehicles are paid for because I paid cash for them at the time of purchase. I do my own maintenance on them.
My home is the only thing I have on credit - 4 years into a 15 year note - and even that had 30% of the sale price plunked down in cash by me when we bought it.
I gave up on credit cards about 8 years ago as being more trouble than they were worth. I cut them up then; and nowadays, when I need to rent a car or book a flight, I use the standard issue debit card connected to my business account. It works wonders for paying all my bills online, and the nice thing is, when I'm out of spending cash, I STOP SPENDING!
My father in law is much the same way, and the last time he looked at his credit report/score, it was "hideously" low, simply because he had very little credit history.
I have very little use for credit. If for some reason someone were to revoke my credit and reposess my house, I'd quietly go back to renting a house for my family. But I refuse to go through life beholden to sombody else.
You are a very smart man. That's the way we live too. We don't owe anybody anything. We built our home by ourselves and paid for it as we went. Took about two years of hard hard labor but it was paid for when we walked in the front door. Don't you wish you really knew how many gazillion of trillions of dollares people have lost in the stock market?
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
Then you don't understand the problem.
Do you pay cash for everything? Your house? Your cars?
Do you know about M0/M1/M2, etc.?
Credit makes the workd go round. And it is based on confidence. If everyone called in their chits at the same time, the global economy would collapse.
Can you imagine what would happen if we (U.S.) called in all those nations that owed us? :o
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As I understood it, he basically stated that we're screwed unless the .gov bails out these businesses. I'm not real inclined to agree. One question brought to mind by one of his statements is why do we NEED credit to get on with our daily lives ?!?!?!? Maybe, therein lies the problem.....
Then you don't understand the problem.
Do you pay cash for everything? Your house? Your cars?
Do you know about M0/M1/M2, etc.?
Credit makes the workd go round. And it is based on confidence. If everyone called in their chits at the same time, the global economy would collapse.
Can you imagine what would happen if we (U.S.) called in all those nations that owed us? :o
Yeah, we'd be left empty-handed by all those America hating countries who have no problem taking our dollars into their corrupt little countries. And then we'd really feel the BOHICA when CHINA followed suit and called in all those T-Bills they've been patiently buying up.
"The Full Faith and Credit of the United States Government" wouldn't be worth the paper it was printed on after that.
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Don't you wish you really knew how many gazillion of trillions of dollares people have lost in the stock market?
My wife's parents have similar views. They've set aside a good chunk of their income over the years, and invested conservatively for their entire life, primarily in CDs and bond funds, because "you know, that stock market can crash".
They're about to move into a retirement community. However, they don't have the money afford the places they like. After hearing about their investment strategy, I'd be surprised if they did better than "break even" after taxes and inflation. If they had invested half of their savings into something as simple as an index or SPDR fund, they'd now have more than enough money to afford their first choice.
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Being retired military, I'm wondering how this will affect us retirees and then, the active duty folks. I DO recall getting a couple of late paydays because the budget hadn't been approved. After that, the Government started monkeying with the payday schedule.