House votes down massive bailout measure

[BacktoBasics]

Its nto the average joe getting credit that is the issue here. Its big ing companies. You're looking at this from your view as a salesperson who relies on credit to make some of your your sales, but not from a business exec who relies on credit to keep your business rolling.

I'm not talking about 48 month loans, I'm talking about 3 months short term loans that are standard busines practice. While it sucks when Joe Sc e can't get credit to put money into the economy, how much do you think it sucks when Corp Joe Schoe can't get the money to meet its payroll and inevitably goes under?

Corp Joe can't stay in business anyway. If Corp Joe had a bad mark on his credit he still couldn't get the loan. They are buying up foreclosures and thats the bulk of what their taking in. The Government certainly isn't touching the good stuff.

I agree that in the short term a lot will suffer some might even have to find an alternate source for operating expenses. However theres is a bigger problem in the lending world that needs to be addressed and it won't be if there's a bailout.

It doesn't matter if its a dude buying a car or a multi millionaire trying to make ends meet. The banks aren't lending before or after the bailout.

The bad debt being bought up isn't being removed from any one person or one companies bureau.


I agree that not all business borrow based on a FICO, usually there is some kind of equity envolved. Some do however. Actually most.

[MannyIsGod]

Wow, that Wachovia deal is different from the WaMu buyout. The FDIC could be on the hook to cover a lot of debt this time around. That makes me uneasy as I don't know when that is all supposed to be sorted out. There will be several outright failures for the FDIC to deal with soon enough.

Citi is on the hook for SOME of the banking losses right now. The FDIC may have to kick in at some point but I don't believe its going to be huge. But yeah, the FDIC is going to get a workout. Thats for damn sure.

[whottt]

That is not Wachovia the bank you are looking at. Those assets (the Bank) were bought by Citi. That is the residual Wachovia (securities firm, asset management operation, etc).

False...that is the Wachovia that Citi is buying. Citi hasn't bought them yet.

Care to tall me again why not passing the bailout is such a good thing?

Care to tell me why it is?

[ChumpDumper]

Citi is on the hook for SOME of the banking losses right now. The FDIC may have to kick in at some point but I don't believe its going to be huge.

That's just it -- we don't know, but Citi has basically given the FDIC $12 billion so I guess that mitigates the situation well enough.

But yeah, the FDIC is going to get a workout. Thats for damn sure.

I don't remember exactly, but I checked the FDIC list a few days ago and in the last year there were about as many failures as in the preceding five years. The FDIC has done well to avoid taking on the full brunt of WaMu and Wachovia failures.

[MannyIsGod]

Corp Joe can't stay in business anyway. If Corp Joe had a bad mark on his credit he still couldn't get the loan. They are buying up foreclosures and thats the bulk of what their taking in. The Government certainly isn't touching the good stuff.

I agree that in the short term a lot will suffer some might even have to find an alternate source for operating expenses. However theres is a bigger problem in the lending world that needs to be addressed and it won't be if there's a bailout.

It doesn't matter if its a dude buying a car or a multi millionaire trying to make ends meet. The banks aren't lending before or after the bailout.

The bad debt being bought up isn't being removed from any one person or one companies bureau.


I agree that not all business borrow based on a FICO, usually there is some kind of equity envolved. Some do however. Actually most.

Corporate credit - to my understanding which at this point is limited since I just started reading about all this - changes much faster. There are no black marks on their credit so to speak since these companies aren't defaulting on loans. The black marks on their credit involve a) a lack of captial on hand and b) the bad investments they are on the hook for. If they eliminate both of those then of course it opens up the credit spigot yet again.

Thats not to say there won't still be failures and a rough time. Even with the bailout we were going to see a really rough time. The problem is that now its going to get worse and will take us longer to get through it.

[MannyIsGod]

False...that is the Wachovia that Citi is buying. Citi hasn't bought them yet.



Care to tell me why it is?

You don't get it do you? When Citi buys the assets (bank branches, accounts etc etc) from Wac all that is left trading under Wac is the crap Smeagol just talked about.

[RandomGuy]

That was fun. I wish somehow the bill I owe them would die, as you seem to think it will, but for now I'll just celebrate that the assholes that gouged the out of me are going to be out of jobs.

So where were we?

The point is that the banks that are going to get their ratings downgraded deserve it...

If you and I miss a payment our rating gets downgraded...why should banks be immune to the same standards they hold us to?

All the banks are not going to go out of business, nor is money going to cease to flow into and around the United States of America.

If things get ed up for a few days awesome...you'll survive and so will I.

Things should get a lot cheaper if that happens...I for one will celebrate it.

And for every bank that goes under another will grow.

It's alarmism plain and simple...and you are buying into it 100%. That's what they want you to do. Including the media.

If they are so scared then how come their first instinct was to up the price on their bad securities?

I guess we will get to see who is right. You are missing how the crisis interconnects with the larger economy.

Myopia bred of ignorance.

We are really gonna take it in the shorts here, and you seem to think that this won't affect you or the average person.

That's ok. We will get a chance to see if you are right or full of in the coming months.

I hope you and the pollyannas are right, really I do.

[whottt]

That is not Wachovia the bank you are looking at. Those assets (the Bank) were bought by Citi. That is the residual Wachovia (securities firm, asset management operation, etc).

Care to tall me again why not passing the bailout is such a good thing?

Now they've bought them.

[whottt]

You don't get it do you? When Citi buys the assets (bank branches, accounts etc etc) from Wac all that is left trading under Wac is the crap Smeagol just talked about.

They just bought them. Smeagol was wrong.

[hater]

World markets are already free falling. I expect world markets to drop average of 10% by tomorrow

[KenMcCoy]

Thats not to say there won't still be failures and a rough time. Even with the bailout we were going to see a really rough time. The problem is that now its going to get worse and will take us longer to get through it.

Wrong...we'll get through it a lot quicker if we just let the badly run companies fail. The dropoff will be steeper, but it will be faster. With a bailout, it would be a long drawn out slide with an even longer recovery.

[BacktoBasics]

Corporate credit - to my understanding which at this point is limited since I just started reading about all this - changes much faster. There are no black marks on their credit so to speak since these companies aren't defaulting on loans. The black marks on their credit involve a) a lack of captial on hand and b) the bad investments they are on the hook for. If they eliminate both of those then of course it opens up the credit spigot yet again.

Thats not to say there won't still be failures and a rough time. Even with the bailout we were going to see a really rough time. The problem is that now its going to get worse and will take us longer to get through it.

I may not be well versed in this as well.

I do know that most business platforms answer to a FICO. Now on the flip side of that I do know that some business don't operate that way so I can't say for sure if history is envolved or not. Whats to stop a company form disolving and starting up anyway.

Correct me if I'm wrong but they are buying up all kinds of bad debt not just corporate debt. Thats not the entire purpose of this.

[whottt]

I guess we will get to see who is right. You are missing how the crisis interconnects with the larger economy.

Myopia bred of ignorance.

We are really gonna take it in the shorts here, and you seem to think that this won't affect you or the average person.

That's ok. We will get a chance to see if you are right or full of in the coming months.

I hope you and the pollyannas are right, really I do.

Better go pull all your money out of the bank, before you lose it

[1369]

I'm honestly not worried that the world is going to come crashing around our shoulders tomorrow. I was in college when the Dow shed 22.6% of its value IN ONE DAY. The following year something like 206 banks failed.

The economy of the United States did not grind to a halt.

U.S. industry did not cease to exist.

Like I said, I'll have another beer.

[ChumpDumper]

It's cool how we all became economists overnight. I'm not going to pretend to know what could happen next. Once investors start ting their pants, all bets are off.

[spurster]

http://www.nytimes.com/2008/09/30/business/30bank.html

Citigroup Buys Bank Operations of Wachovia

By ERIC DASH and ANDREW ROSS SORKIN
Published: September 29, 2008

Citigroup reached an agreement early Monday morning to acquire the banking operations of the Wachovia Corporation after making a daring bid that pulled the deeply troubled company from the brink of collapse.

...

Citigroup will assume the first $42 billion on losses tied to Wachovia’s riskiest mortgages and will pay the Federal Insurance Deposit Corporation $12 billion in preferred stock and warrants. In exchange, the F.D.I.C. will absorb all losses above that amount.

...

[MannyIsGod]

I'm honestly not worried that the world is going to come crashing around our shoulders tomorrow. I was in college when the Dow shed 22.6% of its value IN ONE DAY. The following year something like 206 banks failed.

The economy of the United States did not grind to a halt.

U.S. industry did not cease to exist.

Like I said, I'll have another beer.

No one is sayign this is going to happen. That doesn't mean isn't going to be really really bad. Do you really think US Industry has to cease to exsist in order for this to be very bad?

[whottt]

It's cool how we all became economists overnight. I'm not going to pretend to know what could happen next. Once investors start ting their pants, all bets are off.

Illusory *chuckle*

[Anti.Hero]

I wonder how many people will really hate themselves when they remember they have $23k worth of car payments on a depreciating asset.

Cash is is a mother er.


A deep recession is probably the only thing that will reward those who did things the right way?

[MannyIsGod]

It's cool how we all became economists overnight. I'm not going to pretend to know what could happen next. Once investors start ting their pants, all bets are off.

I readily admit to being pretty ignorant in this, but over the past weak and a half I've tried to read up on it a ton. Some of the breakdowns I saw last week were pretty god damn bad.

Can you imagine this country with 10% unemployment? Sure, 9 out of 10 of us would still have jobs, but does that make it good?

[boutons_]

there could be a run on the hedge funds, that would really make for an exciting spectator sport

[DarkReign]

I agree. I just question the judgement of those who think rejecting the bailout is a good thing. People are going to suffer no matter what, bailout or no bailout.

My view is they will suffer much more without the bailout.

I agree with that as well, and I am one of those people who are ardently against any bailout.

$700 billion dollars. $85 Billion for AIG alone. I got an email today that said there are roughly 200 million people in the country who are 18+ years of age. If we all got a cut of that...

85,000,000,000 / 200,000,000 = $425,000 per adult.

If it were......awww it, I'll just cut+paste.

Hi Pals,

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 billion 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, The Birk 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.

Kindest personal regards,

Birk

T. J. Birkenmeier, A Creative Guy & Citizen of the Republic

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!!

Dont tell me about the guy who started it. I dont know, nor care. No, I dont think every adult should get that money either. I think no one should get it because it doesnt exist.

[Findog]

Most likely the toxic fallout from this ensures a bill will pass by Thursday. The House GOP just threw a temper tantrum because Pelosi hurt their fweewings. She sucks and I hope she loses her speakership for that bull speech, but that's not a reason to vote down the bill. What a bunch of ing pansies.

[MannyIsGod]

JESUS ING CHRIST.

If I see that stupid ign chain letter for the math illiterate one more ing time.

DO THE MATH


Please. DO. THE. ING. MATH.

[whottt]

No is ardently against any bailout...we're ardently against a bull one.