as expected, you still haven’t addressed any parts of my argument.
after a little research, it seems as though your company was nothing more than a hand me down from daddy! :lol: you certainly are a trailblazing entrepreneurial revolutionary! O please, show us all the way to economic bliss!
because thats what CPAs do, we fill out 1040EZs :bloated:
i challenge you to address any portion of my argument about the economy. but please, support yourself with some kind of logical throught pattern.
LOL, you were the one that thought that banks should have insurance to cover all of their losses :lol: which is clearly indicative of your lack of understanding of how little you understand overall about the subprime meltdown. do you really think insurers could have paid out the 100s of billions of subprime losses? they just have that much cash on hand to pay out??? :bloated:
for a 38 year old president of a company, you certainly dont know very much. i think your financial knowledge, or significant lack thereof, is laughable. im surprised you havent run your pops’ company into the ground, driven all the unskilled laborers to china, and filed for bankruptcy!
If we the people and the government allowed the “chips to fall where they may” in terms of the current crisis, the banking industry would nearly collapse. Don’t forget these are publically traded companies, thanks to the small tax on capital gains few things in the market are viewed as “long term” investments. As such, companies need to post growth, profits and positive outlooks. Without that investors run, company value nose dives and when this happens to some of the biggest companies in the world it really does trickle down.
So now we have most of the major financial institutions in serious trouble w/ investors, they can’t make new loans because they can’t afford the losses. The result? No new credit no matter how low the fed goes on interest rates (which, keep in mind only drives general inflation up and makes oil prices skyrocket). No new credit means a massive decrease in spending, both consumer side and corporate side. This creates a huge risk of depression and could be a catalyst for massive unemployment as cash flush companies and individuals brace for the worst.
In comes the government, not beholden to wall street traders or ROI driven investors. The government can negotiate terms banks and their investors can’t, they can do this while raising interest rates, they can do this for the LONG term. The result will be a much more stable economy, decrease in inflation, and the ability to give new credit.
This means companies like yours stay in business. People stay in their homes and are able to ride out the home value market, the reduction in foreclosures means general home values rise. Will it cost you a few dollars in the long run? Sure, maybe even a couple thousand…but guess what? That couple thousand is a drop in the bucket compared to the losses you would take if the country went into depression.
Logic? Since when do economics require logic? Haven’t you been listening to the reactionaries in this thread? “ITS THE PEOPLE’S FAULT. THEY’RE STUPID. THEY DESERVE TO BE THROWN OUT ON THE STREET AND BEATEN FOR BUYING TOO MUCH HOUSE. THAT’LL TEACH THEM! THE BANKS ARE STUPID TOO. WE DON’T NEED THEM. LET THEM AND THEIR INSURANCE COMPANIES ALL FOLD. I’M NOT PAYING A DIME MORE TO FIX THIS.”
I am glad you brought that up Fry.
There is a definate trend on here to call me names and turn my critizism of other entities into personal attacks on me.
There are very few times I attack someone personally on here without being attacked first.
I think it’s funny because like you said it just makes you look dumb.
I am quite certain Einstein never started any debates/arguments/discussions by calling someone an idiot or fucktard.
As much as I hate to admit it, JoesTypeS is right. The government is going to have to bail these people out. If it was just the stupid people who bought these houses that would suffer I say kick them out and let them learn a lesson about finance. Unfortunately though it’s the whole economy that will suffer, so chalk another one up to the successful and intelligent having to bail out the idiots again, with the idiots learning absolutely nothing.
They better slap some serious restrictions on the banking industry to make sure they are never again allowed to give out loans like this.
On a side note: there seems to be a increase in private investors recently. I am not saying we don’t need banks but, there seem to be more billionaires loaning money at good rates.
2 more cents…
Banks/lending institutions have been making GIANT profits over the years and they are also one of the most corrupt industries. I am standing by that statement. I am pretty sure the hydraulic pump industry has less corruption. By the way I have absolutely nothing to do with the hydraulic pump industry.
Banking return steady profits & growth… which is why they became such a stalwart in the markets…which is why the industry taking such a hit is impacting the economy on the whole (obv not the only reason). People lost a lot of money on something heretofore thought of as a lower risk portfolio.
Now, as far as being corrupt… that an opinion that I won’t argue, because its too short sighted. They are out to make money, like every business. Are some of things that they (in general) do ridiculous compared to other business models? Sure. But people sign up to use the banks anyways (all the way from big business lending down to college student checkcards).
Its a two way street.
Banking innovated a new high risk product… it worked, and made money, and the projections were fantastic… they returned great profits & values. They had a winning product, and pushed it as far as they could. How is this different then any other business? It all works… as long as the housing bubble didn’t burst. They could’ve weathered the burst alot better if it weren’t for other factors piling on (increases in fuel, consumables, etc) to weaken the consumer… but none of that matters now.
It has got to be fixed. I don’t know how best to fix it, if I did I sure as hell wouldn’t be here.
This is a good step by the fed, and I’ll give Bernanke’s team alot of credit for going out on limbs… it just going to continue to crush the dollar in the short term - not helpful. Will it help the countries cash flow overall?? Sure, sounds like it would in principle. But who’s to judge, considering its never been done this way?
Well back on topic it looks like the promises made on Tuesday didnt bring much faith to the market aside from the obvious jump we had on Tuesday. How do we feel about this? What steps do you guys think should happen to help recover the economy? I like the plan to help the banks as much as i hate bailouts it will help everyone in the long run.
