Bailout

[maat55]

Dave Ramsey announced a solution to the bailouts presented by a respected economist. It describes changing the rules on the Mark to Marker requirements.

It states that this would free up huge amounts of money without government help other than some federal backing of some loans. I'll try to post the blog.

Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan.

Go to read Daves transcript.

[jIM_Ohio]

I liked the explanation of mark to market and how it related to the current problem.

But I am not convinced changing a rule is a fix which fixes the whole problem. I don't know enough about the details to say one way or the other... I just think things like this are more complex than this.

If they sold junk debt to a given mutual fund for example, I think that is as good as Dave's suggestion. Let some people which want more risk take the risk.

I think raising interest rates a little will also help- will give banks more cash because people will open CDs. That should improve liquidity some.

I also read that the aid given to banks already was used to shore up balance sheets more than to bail out the specific bad loans causing the issue. So I do agree throwing more money at a problem might not be wise.

[maat55]

He is having the economist on his show tonight to explain the plan. He also stated that this plan is on the table in congress, but is not being reported.

[LivingAlmostLarge]

mark to market is what fell Enron! Can you say trouble? I agree they need to make companies accountable for their shady ACCOUNTING practices. I'm sorry but I read the book about Enron's fall and the "special" mark to market accounting rules.

I want either complete regulation with the bailout or no bailout. I don't want half behind bailout.

[maat55]

Originally Posted by LivingAlmostLarge

mark to market is what fell Enron! Can you say trouble? I agree they need to make companies accountable for their shady ACCOUNTING practices. I'm sorry but I read the book about Enron's fall and the "special" mark to market accounting rules.

I want either complete regulation with the bailout or no bailout. I don't want half behind bailout.

He went over this with one of his callers, I didn't get to hear much due to clients in the shop. He say's it will solve 60% of the problem and that there would be need for some fed backing on 40% at a possible cost of 40 to 50 b's. Which sounds much better than 700b's and up.

[LivingAlmostLarge]

It doesn't matter. There is more problems than just money. Multiple economists both Republican and Democrat aren't even sure it will work. Some say no help. Let the market fall and learn from this complete deregulation. The free market capitalism will work itself out.

The same people say too much interference will harm the economy. Those who want regulation, say you need a lot of overhaul. And they say it will change, but doing half-behind regulation will lead to the same problems.

Both sides who want or don't want regulation agree. And so what to do? We are putting in for the penny but not the pound? We need to make a decision either way, not "dip"our toes into it.

Which is what is likely to happen. We already did a $300Billion dollar bailout earlier this year without any regulation.

I can stomach a bailout, I cannot stomach a blank check for bailing out rich fat cats.

[maat55]

I'm against the bailout. Anything that can soften the blow outside of turning socialist, I'm for. I'm not an expert, so I don't know what the best thing to do is, but my bones tell me the bailout is not the right thing to do.

I do want to see regulations to avoid a mess like this in the future, but I want our system to stay free of massive government involvement.

[kork13]

your bones are much wiser than i.... I've really no idea what to think. I see both sides, understand the merits of having it and not, but still can't really say what I think is best for the nation overall.... Just be glad that you won't be seeing my name on your presidential ballot.

[LivingAlmostLarge]

It is socialism. And that's what's so funny. We've been the only country preaching free market and at the first sign of trouble we're begging for a bailout. I am a socialist, but I find it ironic so many people are looking for a handout.

What happened to "i don't want the Government telling me what to do?"

I firmly believe if we're going to paying to bail people out we get to set the rules.

Otherwise what's the point?

[kork13]

Originally Posted by LivingAlmostLarge

It is socialism. And that's what's so funny. We've been the only country preaching free market and at the first sign of trouble we're begging for a bailout. I am a socialist, but I find it ironic so many people are looking for a handout.

What happened to "i don't want the Government telling me what to do?"

I don't intend to make this political, but while I agree, how different is that from a welfare system that allows people to remain on welfare from conception to death? Handouts? Yea, bigtime. But still, our country values and insists upon our welfare system, and so it remains. This appears to be similar in nature... I only mean to highlight the constancy of welfare "handouts" for some families. I agree we need something for families in trouble, but it can't support them on the long term. Parallel that with the current situation--I think there should be a way for the USG to help out struggling businesses such as the banking system, or the auto industry (did anyone catch the small references today that $25B has been made available in loans for them?), but they should not be sustaining over the long term, or repeatedly made available.