Harvard Economyst calls bull on The Bailout

As the economists' protest letter stated:
"We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function...

[W]e ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come."
http://faculty.chicagogsb.edu/john.cochrane/research/Papers/mortgage_protest.htm

Instead of trying to resolve this problem in an appropriate manner, political leadership on both sides has tried to garner public support via fear tactics in order to forcefully enact a bad bill.

Yes, there is a problem. Yes, something needs to be done. But I won't support any solution that doesn't consider the opinions of experts.

If liquidity is the problem, then inject liquidity directly onto the banking system by making the US government a new sort of lending institution.

If we stop the foreclosures, that will restore value to the mortgage backed securities that are so troubling to the banks. Use the money as sort of 2nd mortgages or bridge loans so that people can stay in their homes. Bush's bill does nothing to stop foreclosures that will continue to grow while the Wall Street Fat Cats sell their stock on the backs of the American taxpayer and retire to their foreign island or Europe.

Why haven't the RepubliCrats sought advice from economists?

There are probably several plans that would help restore our tattered financial system but Bush's plan isn't one of them.

I completely DISAGREE. This problem is the domino effect of the dangers of an unregulated sector of the industry, and the result of the American people borrowing money and the banks that lent it to them.

It was a HUGE mistake for congress to deny the bill, or to freeze it when they should have cut defense spending instead. The bill treasury sec Paulson designed would stimulate growth by buying the shares the banks can't sustain, freeing them up to regroup their assets. It is an investment, not a loan.

Know what's gonna happen know? credit card companies are next, and the major banks will be forced to merge. No more money will be lent as a consequence of this, and the American economy will not recover. The bailout is good, even if the prospects are bad.

the banking and financial institute is the real own culprits themselves, their prefer to take good cares of the big fish . which is the main causes of the financial crises in america today. where is the money gone to, i'm sure the money is still there,can't be lost in space. their is receiver of it

This man is completely correct, if the bailout had gone through it would have just postponed and increased the length of the recession to come. No thanks to bailing out what the richest 5% of America has gotten themselves into, let someone else in for a slice of the pie.

I'm not paying for these wall street fuck heads errors. I'm also down for all those supposed brillant CEO's, to be forced to give back their $58 million bonuses they cashed in on last year.

Looks like wall street got caught in the running of the bulls.

If the government buys discounted sub prime and adjustable rate mortgages those people will just be grateful to have a chance to keep their houses. The government loans money to banks, why not to the people? They need to pay a fair interest. It will be a win, win as far as I can see. Most of them were making their payments just fine until the interest rates went up too high on their loan. Buying up those mortgages would keep the value of houses up and save the banks that didn't over indulge in high risk loans. Beats paying off the gambling debts of Wall Street.

Everyone has been saying how bad this bailout is. I think America needs this. We should bail these companies out. Profit, if any, that is collected with the re-selling should be directed into a program such as social security to keep it as the people's money. Then the companies should be told that they have proven that they can not behave on their own, so the government needs to watch over them. When ever a lobbyist try to get rid of needed regulation you just point out, "you want another 2008 on our hands?" In the long run, politically, the bailout will be good.

Why not recall 75% of the outrageous wages, perks and benefits these Wallstreet CEO's and directors have been paid all of these years. That should come to well over the $799 billion dollars they want. Dig deep into the pockets of the Billionaires and especially the Oil CEO's and operators. Let the Bush's and the Cheney's and Addisons, and the Haliburton's, Bechtels, Blackwater, etc return the money's they have stolen and that should more than return Wallstreet to normalcy. What? Thats not fair! Wrong.. These wealthy brokers have had no pity or sympathy for the low paid Americans, so take away their wealth because they did'nt earn it or we would'nt be in this mess.

Economic Patriot Act.

Just say no!

Let it fail!

Ride on!

I completely agree. Rushing it through is being done solely to pull the wool over our eyes and rip us off yet again. To use their(financial establishment) own words, "let the market decide" if the troubled companies sink or swim. If I make bad financial decisions, they say it is my problem and no one, especially the government, bails me out of debt. In closing, I say..."If they fail, they fail!" Someone else will step in to replace them as well.

I think they will have too rewrite and rewrite until they get it right.