Bailout by Stealth

I think I'll be able to squeek through this. Thanks to God, my health is good, I own my cars, house, and have no debt.

I believe that credit cards are the source of this financial down fall. Credit Cards have been charging loan shark rated of 30% and more.

The reason why loan sharking is a crime, is that the borrower, will never get out of the debt. The default rate on credit cards began to rise.

The government offered a solution, 2nd mortgages for 75% of the value of the house, then to 90%, then to 100%, and finally to 125%.

Bankrupcies began to increase. Bush made bankrupcies less desirable with a new bankrupcy laws for consummers.

Of course corporate bankrupcy laws stayed the same. The wonderful corporate bankrupcy laws that permited corporations to wall away from pension. Leaving the pensioners go to the government.

The tougher bankrupcy laws did help, when people walked away from their houses.

vote nader

It's fun watching everyone get uncomfortable and roll their eyes when Ron Paul speaks THE TRUTH.

They really don't know.

And what happen when the Europe had the same type of influence to its market from the WTO, the Euro, hello Amero,and our Sovreinty.is toast its Fabion socializm

The basic problem is being foolish enough to loan money that will never be paid back. In that regard the biggest fool of all is China because the USA is the quintessential "sub prime borrower" ..... Private parties can just walk away from their debt and the U.S. Government can roll the money presses day and night. For this reason I am happy to see this mess because it reduces the chances that we can continue to borrow money from China to finance wars around the world.

Bush just wants the Trillion to Bail-Out his adminisration and to save his ass, from being whacked. All that money is going for Foreign Debt.

The bail-out boondoggle is based on a view of the problem that puts the horse before the cart. The key to the economic problem is that the real estate market tanked, and that is why the loans are upside down, or not worth face value, not the other way around. say in 2005 a house prices were $250,000 that was the market price, lots of folks rushed to get a $200,000 or $250,000 loan, because the rates were low, the economy, jobs income was booming, and prices were rising, as they always had in real estate... then the FED got scared about inflation, so raised the rates ... every month for a year and a half, until the real estate market screached to a halt, then hack politicians like schumer tried to get free publicity by scapegoating banks with a few examples of ignorant borrowers swindled by mortgage hucksters.. the banks became the badguys for lending money.. so what did they do? they stopped lending. then the real estate market really melted down, so the $250,000 house is now worth $100,000 and the homeowner/borrower is begging the bank to take it back, so they can buy the same house next door and cut thier mortgage payments in half, which they must do because thier jobs and incomes have also fallen. On top of all this other housing expenses - taxes, utlities, and homeowner insurance spiked to all time highs, just as household incomes and equity were dropping. Home equity is the main form of household wealth, so america is now poorer, spending less, driving down employment and incomes - this is the key to our sluggish economy.

The FED tried too little to late to get the banks to lend by giving them a really low discount rate, below 2%, but the banks instead borrow billions and instead use it to speculate on wallstreet, driving up the price of commodititys, like Oil futures, causing gas prices and inflation to rise.

The answer to this problem is simple. Instead of bailing out goldman sacs executives, fund FHA to lend directly to homeowners at very low rates, similar to the 2% the banks already borrow at, this costs nothing, because the fed is already lending to banks at these low rates, we just eliminate the middle men and go directly to the mortgage loans that we want to fund to fix the problem. Allow homeowners to refi at the short sale value of thier home so they can keep thier home instead of buying the house next door. This will restore the housing market, home equity, employment, and income to the middle class..

On August 15, 1971 Nixon took the US dollar off the gold standard and allowed it to "float". Fiat money was the result and allowed for the expansion and contraction of the monetary supply and created yet another tool for political control in exchange for controlled growth.

The Austrian School of Economics has predicted the collapse of the current monetary system and is illustrated in the writings of Ludwig Von Mises and other scholars in the Austrian School of Economics.

Is the solution a return the the gold or other commodity based based dollar? Perhaps, but I'm not smart enough to work it out. Maybe the powers that could. It has the potential to bring real stability to our markets but not without pain.

Twelve step prgrams say that change can occur when the pain of staying the same is greater than the pain of change.

Have we reached this point?