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Well that sucks
Why do we need a bailout? Our government already seems to have enough power to take action. If there is a credit problem, maybe the fed can buy commercial paper, etc. to keep things moving, and take over and sell banks as needed.
http://www.nytimes.com/2008/09/26/business/26wamu.html
Government Seizes WaMu and Sells Some Assets
By ERIC DASH and ANDREW ROSS SORKIN
Published: September 25, 2008
Washington Mutual, the giant lender that came to symbolize the excesses of the mortgage boom, was seized by federal regulators on Thursday night in the largest bank failure in American history.
Regulators simultaneously brokered an emergency sale of virtually all of Washington Mutual to JPMorgan Chase. The remainder of WaMu, the nation’s largest savings and loan, will be operated by the government. Shareholders and some bondholders will be wiped out. WaMu deposits are guaranteed by the Federal Deposit Insurance Corporation up to the $100,000 limit for each account. WaMu customers are unlikely to be affected.
JPMorgan Chase is to take control on Friday of all of WaMu’s 2,300 branches, which stretch from New York to California, and will oversee its big portfolio of mortgage and credit card loans. It will also acquire all of WaMu’s deposits with the sale.
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Well that sucks
Yeah, I guess the high interest rates won't matter much with the oncoming inflation.
dumb ass we've had artificially low interest rates for years...its time to let the market be for a change.
WaMu had artificially high interest rates of which I took advantage, and will continue to take advantage. The cool thing with the takeover is that I can move money out of my CDs early if I choose without penalty.
They better not jack down my 4% APY on my savings.
They probably will, that's why I put a good chunk in a CD last week.
LOL dude, expect that to be at 1% or so really quickly. How the do you have a regular savings account with 4% right now?They better not jack down my 4% APY on my savings.
as long as my balance transfer goes through, i really dont give a damn what WAMU does. Though this just means I now have another credit account through Chase.
Thrilling.
I do through United SA Federal Credit Union.
It's a money market account linked to free checking.
Do you really think the buyout is necessary to save Wall Street and our economy? It's helping Paulson and co. bail out their buddies, nothing more.Why do we need a bailout? Our government already seems to have enough power to take action. If there is a credit problem, maybe the fed can buy commercial paper, etc. to keep things moving, and take over and sell banks as needed.
92% of the mortgages in this country are being paid on time. We've had what, 13 banks fail (there were 1000s in the S&L crisis in the 80s).
Let the greedy s fail and go bankrupt. Other banks that are run responsibly will step up to fill the void (and they deserve our dollars for not putting our economy in this situation).
That would be all well and good if the damage were just to those banks who made really ty decisions.
The problem is the "ripple" effect.
The fancy term for this is "self-sustaining negative feedback loop".
1) banks that made the bad loan decisions fail.
2) This lowers the availability of credit overall, causing:
3) larger costs of borrowing for everybody.
4) businesses can't afford to expand or capitalize on opportunities
5) consumers can't afford to consume.
6) Many businesses that rely on some credit to function, cease functioning.
7) unemployment and overall defaults on loans and that causes:
1) banks that made good loan decisions to fail.
2) This lowers the availability of credit overall, causing:
3) larger costs of borrowing for everybody.
4) businesses can't afford to expand or capitalize on opportunities
5) consumers can't afford to consume.
6) Many businesses that rely on some credit to function, cease functioning.
7) unemployment and overall defaults on loans cause
1) banks that made good loan decisions to fail.
2) etc
3) etc
4) etc
This is the loop that Bernake, who has studied the root causes of the Depression for most of his adult life, is attempting to break.
The sooner you intervene, the cheaper it is to fix the problem.
Doing nothing and allowing "the market" to right itself is simply asking for this nasty little cycle to cause a truly apocolyptic scenario. The ghost of Herbert Hoover seems to be haunting his party again.
We are looking at the very least a slowdown, probably a recession, and possibly a Depression with a capital "D". I do not say that lightly.
We, as a nation, are leveraged up to our eyeballs. Take away our ability to borrow, and you will see a prolonged contraction.
holy , their stock is down over 90% today.
Like it or not, the rescuing the greedy s who caused the problem will prevent a lot of people who weren't greedy s and made fairly prudent decisions from being dragged down too.
Personally, I would be all about the death penalty for some of these bas s. Save their ins utions, but line 'em up in front of a firing squad.
Barring that, some hard time in a nice pound-you-in-the-ass federal prison would do.
I bank with WAMU and work at AIG! We need help!
Well, that certainly informs my opinion of your posts...I bank with WAMU and work at AIG! We need help!
Sincerely, good luck to you.
I don't understand why the government can't intervene at Step 2. In essence to provide capital for banks to make short-term loans or to do it themselves with the companies that the government practically owns or will own soon.
Removing double post
Good.
Maybe it will wake people up to their taskmasters. Or not, either way, we start over.
Yeah, I know that is goin down.I'd just like to carry out my state of denial as long as possible.
The entire reason I switched to WaMu was the incredible rates on Online Savings (it was 4.75% when I started), but I knew anything that good wasnt bound to last forever.
Negative feedback loops are good and stable. It's the positive ones we should be worried about.
You mean you bank at Chase.I bank with WAMU and work at AIG! We need help!
And as long as you stayed within your FDIC limits, there was never any problem with your judgment. , even the people who had more in there aren't losing anything in the takeover.
WaMu's shareholders are the folks taking it in the ass this time around. It's actually a bit refreshing, but I'd be pissed a that WaMu's board didn't take Chase's $8 per share offer when they had the chance.
It's safe my to say my holdings are within the FDIC limit! I have worked for a subsidiary of AIG for over tem yrs. AIG bought out company about 8.5 yrs ago. According to Yoni I should have used better judgement in finding a job 10 yrs ago.
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