the bailout

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Postby dwchang » Wed Oct 01, 2008 2:49 am

BasharOfTheAges wrote:The markets rebounded pretty well today for impending doom.

I think we honestly need to let this play out. Our economy is all smoke and mirrors at this point and the constant, rapid growth of the past 20 years is not a feasible long-term thing. It can't go on indefinitely, especially when so much of it was built on money that isn't real and debts that can never be repaid.

It doesn't help when a debate that should center around logic has so much emotion tied to it. Nobody wants to look like the bad guy for saying "well, we were stupid and should probably have to pay for it sometime - either do it now or have it be 10x worse in a decade or two."


There's a difference between disagreeing with rapid growth/expansion and having NO growth (or very little).

No banks means no loans for even smaller businesses (not just dotcoms and stuff...mom and pop stores included). That also means less loans to home owners who AREN'T risky (They are no viewed as risky...nearly all loans are). That will bring the economy to a HALT, not slow it down. Bad economy = less jobs. Less jobs = more people in poverty...and on and on.

There's a HUGE difference and I'm surprised anyone would surprise NO growth and NO lending.

gl; hf
gg US economy
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Postby downwithpants » Wed Oct 01, 2008 6:25 am

oh the economy will come back in 4-5 years, even if we don't bail out banks/financial institutions and more go under (provided they don't all go under). but it's going to bring heavy costs associated with the period of high unemployment and costs associated with the turnover of employees and companies and perhaps entire industries (who's going to trust their money with investment banks in the future?). and if you're planning on retiring on your 401k the next few years, youre quite boned.
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Postby BasharOfTheAges » Wed Oct 01, 2008 3:34 pm

dwchang wrote:There's a difference between disagreeing with rapid growth/expansion and having NO growth (or very little).
It's not so much the growth that I disagree with - more the fact that it's based on fallacies and illusions that everything is alright. Banks multiplied money for a long time over and over again, then they loaned that money out - enabling (in the context of what you do to someone by ignoring their drug problem) people to buy ridiculously expensive homes they couldn't ever afford. Now they don't actually have a leg to stand on when the curtain was pulled aside, it looks dire - partly because it is and partly because it opens the eyes of the average person to question our money further. And questioning things that have no basis in reality (like our money) leads to paradox.

I know what the consequences of not acting are (my father is a year away from retirement and he had lots of his 401K money pilled up in the S&P), but I don't think it makes economic sense to let fear of the consequences completely direct our course.

Ultimately, any congressman that opposes this looks bad to Joe Q Public, and that's all that really matters to them. Hopefully the brashness of the riders on this round2 bill will allow them to point to the riders when they're asked why they didn't vote one way or another. Gotta pull some slight-of-hand to impart any sort of deep thinking into the political process...
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Postby Sukunai » Sun Oct 05, 2008 9:53 am

Two wrongs don't make a right.

Stupid greed started the mess, and bailing out stupid greed won't really fix it.

Enjoy being taxed to oblivion, because that money is coming out of your pockets.

Damned glad I am not American right now.
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Postby dwchang » Sun Oct 05, 2008 1:31 pm

Sukunai wrote:Two wrongs don't make a right.

Stupid greed started the mess, and bailing out stupid greed won't really fix it.

Enjoy being taxed to oblivion, because that money is coming out of your pockets.

Damned glad I am not American right now.


Yeah the second wrong would be NOT helping out EVERYONE and not bailing them out.

Did you not read anything Jasper, dwp or I even wrote? The second wrong would be preventing US citizens who want to buy a home, small business who want to expand, etc. from getting loans and being laid off. The US economy will come to a screeching halt and the global economy will also be boned. Have you not watched the Japanese and UK markets as well? It's all related.

No borrowing/credit = little to no growth which in turn leads to higher unemployment, less taxable income for the government and so on and so forth. The things you've seen the last few weeks is FAR from the last dominoes to fall. Financial people aren't *all* idiots. There's a reason markets are tumbling and it's not based on nothing.

Also it's not money out of our pockets or higher taxes. If Bush, Obama or McCain said that they would be totally screwed in the polls. They're just printing more money and will *hopefully* cut spending and increase the national debt. In time, the hope is we will get the money back that we lent and we might even make a profit. It *is* American taxpayer money, but not MORE taxpayer money and more taxes. It sounds kind of silly, but we have a HUGE national debt and crazy spending for a reason...

Again, if either McCain or Obama were raising taxes for this, they'd have TANKED in the polls. They'll figure another way to do it (even if they haven't told us -_-).
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Postby Sukunai » Sun Oct 05, 2008 6:57 pm

Guess how much plastic debt I have?

I have a Mastercard with nothing on it.
My Visa will be empty tomorrow after I get to the bank.
It's because I understand the concept of not spending money I never had.

Guess where your bail out money is coming from. Actually it's probably coming from China yet again. If the Chinese are patient, they will eventually own the US.

When they re did Red Dawn they should have picked a massive drought in China, and their needing to cash in on debts owned them. Would have been more chilling.

Anyway, I'm aware what the US going down the toilet would mean to Canada. It's annoying that the entire planet is seemingly incapable of managing finances the way any normal common schmuck has to do in their own home.

I suppose if the US is very lucky owning all that real estate might pan out. You better hope it does. It would sure suck if housing continued to lose value.
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Postby downwithpants » Sun Oct 05, 2008 9:39 pm

Sukunai wrote:It's because I understand the concept of not spending money I never had.

you do realize, 99% of American citizens wouldn't be able to afford to buy a house until they are near retirement? would it be wiser for them to just rent until then and not gain any equity?
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Postby Sukunai » Mon Oct 06, 2008 6:30 am

downwithpants wrote:
Sukunai wrote:It's because I understand the concept of not spending money I never had.

you do realize, 99% of American citizens wouldn't be able to afford to buy a house until they are near retirement? would it be wiser for them to just rent until then and not gain any equity?


You do realize that 100% of those 99% likely SHOULD be renting if they don't have the income.

They also might try stomaching the concept that being American is NOT always the greatest thing in the universe either. Well according to 99% of the planet that isn't in the US.

They could always try doing what many of the rich who were poor originally did. And suffer so that their kids maaaaaybe had a better chance.
Yes it's called doing without for the sake of the future rather than spending the future now and to hell with those in the future (which largely sums up the US approach to the entire subject of the environment).

Of my friends, those with homes and those without. Those without in some cases could be those WITH. But in some cases they simply don't have the urge to do without for the sake of a later gain.

Renting isn't the end of the world.
I rent. It's a very nice place actually.
The landlord is very good at keeping the place in great shape.
I highly doubt I could afford to make my own house look this nice.
And I don't pay property taxes.
And if something DOES go wrong with it, I don't suddenly need a loan to fix it.
And next month, my bill will be the same easy to predict amount.
Brother had to do a major bathroom repair on his place. Yippee.
Sister has sunk all kinds of cosmetic cash into hers.
I doubt either would get any real benefit out of having done it, if they put them on the market.

I've been defacto retired since 93. my only advice, never retire.
You have worse worries than income waiting for you.
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Postby downwithpants » Mon Oct 06, 2008 10:52 am

Sukunai wrote:You do realize that 100% of those 99% likely SHOULD be renting if they don't have the income.

This would leave all houses in the hands of the richest 1%. While it is feasible, it worsens the inequality between rich and poor.

The choice between renting vs owning is largely based on lifestyle preference, but keep in mind landlords will try to charge rent at a price such that their income from rent and capital gain exceeds the cost of taxes, bills, and mortgage.
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Postby JaddziaDax » Mon Oct 06, 2008 10:59 am

I don't think its a matter of "living outside their means" then it is that some people have been duped into thinking that buying a house can cost the same as renting O.o

It's not just that people were buying houses they couldn't afford, but also that some lending companies were offering mortgages on rates that were not fixed. Quite a few of those people who had lost their houses COULD afford it when they first got their mortgage, then the rates just went up and up and it became so expensive that they couldn't afford it anymore. There is blame on both sides of the "lending fence" here.
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Postby Garylisk » Mon Oct 06, 2008 4:41 pm

Vlad G Pohnert wrote:Give me the Bailout money, for that much cash I'll be sure to fix all of America's problems

Vlad


I support this.

P.S. what's my cut as a supporter? :P
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Postby Sukunai » Mon Oct 06, 2008 8:04 pm

JaddziaDax wrote:I don't think its a matter of "living outside their means" then it is that some people have been duped into thinking that buying a house can cost the same as renting O.o

It's not just that people were buying houses they couldn't afford, but also that some lending companies were offering mortgages on rates that were not fixed. Quite a few of those people who had lost their houses COULD afford it when they first got their mortgage, then the rates just went up and up and it became so expensive that they couldn't afford it anymore. There is blame on both sides of the "lending fence" here.


In those cases, I think the rules need some massive reworking. Not going to happen of course. Capitalism isn't about caring, it's about getting rich.

But if 46 years of life has shown me, most people are their own worst enemies. You usually put yourself in the situation you are in with your eyes open in Canada and the US. Won't speak for the rest of the world on that one.

I shouldn't be able to afford where I live. I shouldn't be able to afford the services I enjoy. Society has convinced itself it can't get by without a car too. I don't own a car, haven't my entire life. Not owning a car though (which I couldn't justify at all), leaves me all the cash grabbed by license, insurance, gas, maintenance, plus the cost to buy the car of course.

Interestingly, I COULD be sitting in my own home if not for the fact that banks spit out mortgages based on formulas based on THEIR presumptions of how much money I need in a month.
Those presumptions usually include things society has convinced itself it can't do without. Like cars.
Of course any home I bought, with MY income, certainly wouldn't be in the cool neighborhood.
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Postby JaddziaDax » Mon Oct 06, 2008 8:52 pm

Sukunai wrote:Interestingly, I COULD be sitting in my own home if not for the fact that banks spit out mortgages based on formulas based on THEIR presumptions of how much money I need in a month.
Those presumptions usually include things society has convinced itself it can't do without. Like cars.


You know, this is how my land lord treats me, I'm not allowed to live here unless I make so much money a month, and it has to be 3X the rent for the reasons of exacly what you said right there.

However, no matter how nice this place is, I still want to gtfo because of all the regulations placed on my apartment. If I wanted my "parents" telling me how to live (aka the apartment management) I'd live with my fecking parents still.

(the most recent complaint from them is people letting their dogs poop on the grass and not cleaning it up, they threatened to charge extra a month for pet owners... I have an indoor cat that never goes outside, so I'm getting threatening letters for other people who live here)
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Postby dwchang » Mon Oct 06, 2008 9:09 pm

Sukunai wrote:
downwithpants wrote:
Sukunai wrote:It's because I understand the concept of not spending money I never had.

you do realize, 99% of American citizens wouldn't be able to afford to buy a house until they are near retirement? would it be wiser for them to just rent until then and not gain any equity?


You do realize that 100% of those 99% likely SHOULD be renting if they don't have the income.


Uhm...wut?

Yeah let's completely destroy the housing market and have NO houses then. After all, no one can afford them. Mortgages and loans work b/c people *are* capable of paying them back and thus can own houses. I am not denying that the recent crisis is due to folks overestimating, but that has nothing to do with the basic principle of lending and mortgages.

By your own logic, almost no one would own houses and by supply and demand, no one would even want to build a house to sell since no one can afford them.

This is beyond retarded and you seem to lack some seriously fundamental principles behind lending and mortgages and yet seem to lecture people otherwise. I guess just about every homeowner in THE WORLD (not just the US) is an idiot.

:roll:
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Postby downwithpants » Mon Oct 06, 2008 10:12 pm

Sukunai wrote:In those cases, I think the rules need some massive reworking. Not going to happen of course.

that's actually one of the key points our lovely politicians (including our presidential candidates) are currently arguing about. republicans have for years pushed for deregulation and now democrats are calling them out on it.
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