Stunning defeat for economy bailout; stocks plunge

lets not forget that the financial industry has been the #1 campaign contributor/lobbyist/advisiors to political campaigns over the past 20 or so years, now that wall street is in trouble -(or so we have been told)- the same politicians that have been kept in office are the same ones that are gonna bail them out, sounds like the financial industry is getting a pretty good return on its investment

Disassemble is good ! We should start with the Democrates who knew this was going to fail and prosecute them all. Pelosi, Frank, Rainey, Todd and lets not forget who was the #2 acceptor of campaign contributions from Fannie, Freddie -----OBAMA This is nothing more than a scandel of huge Democratic proportions.

Lets take the 7 billion and give it to American tax payers then we can pay on our mortgages that will give the mortgage companies the money they need while giving all of us tax payers a break for a change Lets pay off main street . I'm tired of our leaders spending our money like its nothing- giving it to wall street is not the way I want my tax dollars spent. when we lose our jobs we don't see millions of dollars in a walkout package..........

Lets take the 7 billion and give it to American tax payers then we can pay on our mortgages

Ok that is 2333 dollars ffor every person in the country. You aren't going to pay too many mortgage off with that unless you have a really crappy house.

The idea is not a sound one on many levels.

It was right not to approve the bailout of bad debt. All investment contains risk. If you try to eliminate the risk, you don't have a free market. Instead, you'd have socialism or communism.

In a free market, bad ideas fail and sound ideas flourish. Let's let the sound ideas rise to their proper position without all the government intervention and manipulation. Otherwise, economic disasters will occur again and again ad nauseam.

The next step is to eliminate the cause of it all: The Federal Reserve.

I guess you heard Bush is not running again, ergo, a new administration.

Doctor Larry,

"I guess you heard Bush is not running again, ergo, a new administration."

Not if McCain wins, he'll just be another Bush. Funny that the Dixie Chicks were almost run out of the country not that long ago, and shunned because one of them said she was embarrassed that Bush was from Texas. Seems kind of petty now compared to some of the things being said today!

Seems kind of petty now compared to some of the things being said today!

And don't forget those "Freedom Fries", the congressional snub of the French who didn't hop on board the "Shock and Awe" express! I guess we showed them didn't we?! ;)

I personally think Bush and the executive branch are overstating the seriousness of this crisis in an attempt to create hysteria and shock in the public. I think they want to create confusion and high-strung emotions around this election to try and grab as much power as they can before the electorate kicks them out and replaces them with a true populist leader in Obama.

You are a conspiracy theorist?

Do you think Warren Buffet is just trying to exaggerate the problem?

The 3 month tbill yield was essentially zero at time this week and people couldnt get enough of them. They were wiling to take no interest just to be guaranteed to get their money back.

It is incredibly difficult to get a business loan these days. The free flow of moeny through the credit markets is essential to our economy.

I'm not saying the situation isn't serious, but why should we take any calls to urgent action from executive branch at face value? Has Bush and company not proven that they will blatantly lie in order to advance their agenda?

A serious economic situation that has taken years to develop will not be satisfied with a $700 billion band-aid. Until Democrats and non-partisan experts have a chance to come to the same conclusions as Bush's cabinet, I don't think we should give them an inch beyond what they currently have to manage the situation.

It isn't just Bush's cabinet. It is the congress, investors, mccain, obama, pelosi, dodd, and a slew of others. wachovia goes bankrupt the day the deal dies shortly followed by other large banks. There is no money being lent right now and it is critical for the economy that the credit markets open up. The credit markets are dry, the president and his cabinet can't be "rigging" this. Nobody has come out and said there isn't a problem or that the problem isn't grave, nobody. Interest rates are near zero, there are no other available means to free up the flow of money available. If Congress were to announce nothing was going to be done, the market would drop 2000 points.

Here is what Buffet said,""Buffett told us the financial system was on the brink of collapse last week before Paulson and Bernanke went to Congress with their plan. And he warns that last week will "look like Nirvana" if a bailout plan isn't passed by Congress."

It is a big @!$%# sandwich and we all have to take a bite

But it will still taste better than the alternative.

Warren Buffett is an Obama supporter and he agrees with the Bush characterization.

Warren Buffett is an Obama supporter and he agrees with the Bush characterization.

Correct.

So let me get this straight, as I show my lack of business finesse.

We got in trouble by borrowing money (for home loans etc.) we couldn't afford to repay. So the way out is to "free up the credit markets" for more borrowing, because the only way business can survive is to take out big loans?

What am I missing? (and please, spare me the "a brain" remarks. Heh;-)

OK, so Buffet thinks a bailout is necessary. That's one tick in the non-Bush column. I'll still be on the lookout for several additional voices to second the Bush administration's recommendations before my support is given.

We got in trouble by borrowing money (for home loans etc.) we couldn't afford to repay.

Yes part of the problem, hence Fannie Mae and Freddie Mac got hammered.

However the trouble was compounded from the derivative financial instruments, the MBS bonds.

So if I am a company holding a bunch of MBS, I paid out my cash for them and now I have an asset, I have bonds. The value of those bonds has decreased. In fact, for practical purposes, the market for selling those bonds has disappeared on me. So unless I can ride it out until the bonds mature, those bonds are worthless because I can't find anybody to buy them. Furthermore, the cash flow from these bonds is significantly less than I anticipated. I have to write down the value of my impaired assets, the bonds. So now my books look like crap. Depending on how deep I am in my liabilities can approach or exceed my assets. Furthermore, who will loan me money, nobody because my books look like crap and even my written down assets are still hard to value without a market for them. Also because my cash flow is reduced and my cash is tied up in bonds, I don't have any money to loan to you, so that hampers me from making money on interest on loans. Basically I am screwed. If my liabilities do exceed my assets I have to file for bankruptcy. Big loans, little loans, loans are how companies in this country get a large amount of their capital that is used for investing in things like property, plants, equipment, materials, etc.. We do need the banks for the economy to function and we do need them to loan money.

So if the government can create a market for my MBS' then I can sell them at a reasonable price, take some loss, but not total loss, and I get cash that I can then loan out and make money on it. My books no longer look as crappy. They may show a loss but it is now possible to value my company correctly as the MBS are not part of the equation any more.

AIG got in trouble by insuring the MBS.

OK, so Buffet thinks a bailout is necessary. That's one tick in the non-Bush column. I'll still be on the lookout for several additional voices to second the Bush administration's recommendations before my support is given.

Other than people such as Ron Paul and Richard (Dick) Shelby types that are opposed to a bailout on general principles not based on the necessity of it (in other words people that believe the market willself correct so let the chips fall where they may), who do you have that says we shouldn't do this bailout?

-O- I dont know..... Just 90 percent of the population in the USA.

I dont know..... Just 90 percent of the population in the USA

Really I know nobody that doesn't agree that this needs to get done. Even if they don't understand the situation they know the drop in the stock market will cost them more than the bail out. People that don't think the bail out should happen clearly don't understand what is going on and don't understand the importance of banks in the economy.

Actually, that is exactly backwards. It is obvious that the Dems are being partisan and trying to keep this front and center as long as possible since they feel it helps Obama.
Bush is going against many in his party on principle, not politics. Take off your blue-shaded glasses.

Actually, that is exactly backwards. It is obvious that the Dems are being partisan and trying to keep this front and center as long as possible since they feel it helps Obama.

Wow. That is one of the most ignorant staements I have ever heard and being I look at Newsvine a lot, that is really saying something.

I can tell you part of what caused this to happen. Distribution of income shift to favour the wealthy. No real increase in minimum wage and cheap illegal labour.

During the President Clinton Administration--The truth happens to hurt--but it does involve an "agenda", where there was a "Push it thru Drive'" at that time. A "Bill" was proposed in
Congress--that more 'Renters in America' should be able to 'Buy their Own Home'-- So "that
Bill" went thru Congress, enforcing that Loan Institutions "Had to Find a Way" to make loans
availuable to 'all persons' that applied--without a 'Hint of Discrimination'. In the Bill was a
penalty-clause against any Company that did not comply... So the Loans were made, "No
Down Payments, no serious Ability to Pay Credit-Checks, No Credit-Histories etc. Because
of the increasing Sales of Homes, Prices were Over-valued by liberal Appraisers & all homes
went up & Up!! The houses were then over-valued as much as 25%. Banks & Mortgage Co's
then sold these Loans to "Fannie-May" & Freddie-Mac". Houses normally valued at $100,000
were now $150,000. Now, many speculators entered into the market. (Make the 'big money'
while you can--you can become a 'Millionaire' in six-years at this rate!!) This was over-done by
"Late-nite" TV commercials--- And 'They' drove the housing market up another 25%. The
$100,000 house was now valued at $150,000. And then came the housing market "slump"--
too many houses, besides the one's being 'Fore-closed' because he lost his job, or drugs. And
now, you've got the "BIG PROBLEM"!! 1 Million homes being fore-closed, where the Federal
Govt. only guaranteed 80% of the Loan-- You got a $140,000 Loan--and can't sell the house
now for only, $105,000!! What happens NOW--let's guess? Can you see the problem getting
bigger & bigger? Can you see how this Government Law trying to improve everybodys' welfare comes out--especially where you "FORCE" all 'Lending-institutions' to forget common-sense
"Business-Principles"?? So suddenly, Uh, We get this Financial Company "Melt-Down", but it's
gradual, it's not all-of-a-sudden!! Do you-all understand it, Now?! Am I Wrong on What Hap-
pened!? Let's hear your truthful views--without the 'name-calling'... Before I quit on this, the Democratic and the Republican Parties in Congress are "both" equally to blame for passing the Bill, and President Clinton did SIGN it, but he's not solely to
blame either! Both Parties bear "Equal-Guilt"--! In 2000, as I understand it, President Bush did request Congress to 'propose' a Bill, which
would place some restraints & place some regulations on these loans. Mostly, he was ignored,
or the proposals were tabled & defeated at the 'committee-level'. In 2005, McCain did enter a
Bill, which proposed some "Loan Regulations", but it also was 'Tabled & Killed' in committee.
The Presidents DO NOT LEGISLATE--that JOB BELONGS TO CONGRESS!! And it takes the
Majority of Congress to pass a BILL to the President! FACTS ARE FACTS!! Am I Being Fair?!

'53 Korean Vet-527282,

A "Bill" was proposed in
Congress--that more 'Renters in America' should be able to 'Buy their Own Home'

Can you name the bill?

Yes, Bush deregulated FURTHER. Freddie and Fannie were fine under Clinton's bill. Bush tipped it over the line.

LOL... whatever you do, don't touch his stapler.

It aint over yet. I'd say 50% chance it still gets through the house today.

The GD Republicans are playing politics as usual. They do not care if they finish wrecking the country. Believe me, if the market crashes, and unemployment skyrockets, you will be wailing about how the government has let you down. This HAS TO BE DONE. Boehner turned traitor again after promising to deliver the votes to pass this. Turns out that he has been talking it down behind the scenes. Thanks, Republican idiots for screwing us once again!

It's not the Republicans who started this mess or scandel I should say This has roots deep in the Democratic party. Barney Frank, Pelosi, Rainey, Dodd and so on. Don't forget the #2 acceptor of campaign contributions OBAMA. Prosecution of those listed is what the American people should see.

Right on.

People aren't losing their homes. The bank, or other lender owns the house until the borrower pays for it. When people make loans they can't repay, that's a bad debt and they never owned anything.
Over-regulation is much worse than under-regulation, because now the government is taking a bigger and bigger chunk of stockholder's money just due to regulation, not to accomplish any real earnings.

Before you post the rants of another financial idiot, do the math.
$85 billion divided by 200 million is $425. Period. Isn't that exciting?

IT IS EXCITING AND THATS WHAT IT SAYS.....IF YOU WOULD READ IT!!!!

To my fellow Americans......

*I'm against the $85,000,000,000.00 bailout of AIG.*

Instead, I'm in favor of giving $85,000,000,000 to America in
a *We Deserve It Dividend*.

To make the math simple, let's assume there are 200,000,000
bonafide U.S. Citizens 18+.

Our population is about 301,000,000 counting every man,
woman
and child. So 200,000,000 might be a fair stab at adults 18 and
up..

So divide 200 million adults 18+ into $85 billon that equals
$425,000.00.

My plan is to give $425,000 to every person 18+ as a
*We Deserve It Dividend*.

Of course, it would *NOT* be tax free.
So let's assume a tax rate of 30%.

Every individual 18+ has to pay $127,500.00 in taxes.
That sends $25,500,000,000 right back to Uncle Sam.

But it means that every adult 18+ has $297,500.00 in their
pocket.
A husband and wife has $595,000.00.

*What would you do with $297,500.00 to $595,000.00 in your
family?*
*Pay off your mortgage - housing crisis solved.*
*Repay college loans - what a great boost to new grads*
*Put away money for college - it'll be there*
*Save in a bank - create money to loan to entrepreneurs.*
*Buy a new car - create jobs*
*Invest in the market - capital drives growth*
*Pay for your parent's medical insurance - health care improves*
*Enable Deadbeat Dads to come clean - or else*

*Remember this is for every adult U S Citizen 18+ **including
the folks*
who lost their jobs at Lehman Brothers and every other company
that is cutting back. And of course, for those serving in our
Armed Forces.

If we're going to re-distribute wealth let's really do
it...instead of
trickling out
a puny $1000.00 ( "vote buy" ) economic incentive that is being
proposed by
one of our candidates for President.

If we're going to do an $85 billion bailout, *let's bail out
every adult U S
Citizen 18+!*

*As for AIG - liquidate it.*
Sell off its parts.
Let American General go back to being American General.
Sell off the real estate.
Let the private sector bargain hunters cut it up and clean it
up.

*Here's my rationale.* *We deserve it and AIG doesn't.*

*Sure it's a crazy idea that can "never work."*

But can you imagine the *Coast-To-Coast Block Party*!

How do you spell* Economic Boom?*

*I trust my fellow adult Americans to know how to use the $85
Billion*
*We Deserve It Dividend* more than I do the geniuses at AIG or
in Washington
DC.

And remember, this plan only *really *costs $59.5 Billion
because $25.5
Billion is returned
instantly in taxes to Uncle Sam.

Ahhh...I feel so much better getting that off my chest.

*PS: *Feel free to pass this along to your pals as it's either
good for a
laugh *or a tear or a very sobering thought on how to best use
*$85 Billion!!

In the last 2 years the GOP has filibustered more than any congress in history.The GOP administration got us into this mess by deregulating the financial system in this country and letting their appointed friends run it into the ground.They also deregulated the newsmedia so Fox News could buy the Wall Street Journal another reason why everything was "just fine" until a week ago.If a tree is about to fall on you and you don't move out of the way then you are an idiot and you deserve what you get.

Amen

Actually? I think it's just an excuse to get a break so that tempers can possibly cool a bit before trying again. If they were REALLY serious about "going out and running" it'd be a whole lot longer then 3 days.

Hell, even HIGH SCHOOLS enforce the "3 day rule" between fighting students.

Why should the Democrats go this alone. It is very common what happened today. The problem is that the House Minority Whip didn't do his job and that caused Pelossi to give out too many passes.

Why should something as important as this, be affected by what Nancy Pelosi says? Think about it. Who's is REALLY using this situation as a political field of play?

The economy was doing well, when Clinton left office, ... except for a few stains of heathenism in the Oval office. What has Bush done that is going to be considered positive, while he was in office? Bomb the heck out of Iraq?

Regardless, I can't believe grown adults would stand there and say that they wouldn't vote for the bill, cuz Nancy Pelosi said something that made them mad, at the last minute.

Who's lives do you think you are playing with?????????????????????!!!!!!!!!!!!!

iceman, yeah, it does kind've sound that way to me: "We're going to punish all of the people that voted for us because we didn't like what YOU SAID! And they're all gonna blame YOU 'cause YOU made me DO IT! NAH-NAH-NYAH-NAH-NAH!"