• Quick note - the problem with Youtube videos not embedding on the forum appears to have been fixed, thanks to ZiprHead. If you do still see problems let me know.

Reward the idiot, (*&(* the prudent

jj

Penultimate Amazing
J
Joined
Oct 11, 2001
Messages
21,382
So, is it only me, or does the current "bailout" seem to be of the "(*&&*( the prudent, and help out all the rich people who strung along the idiots" variety?

What do I get from the "bailout" cash? If I get 5 cents, I'll be lucky.

Mortgage? Low-rate 30 year fixed.
Equity? 85% mine.

Just like in the 1970's, it's "ruin the people who behaved responsibly, and inflate away the debt" this time coupled with "and give money to the people who acted idiotically" at the same time.

I am just so impressed. But not in a good way.
 
jj said:
So, is it only me, or does the current "bailout" seem to be of the "(*&&*( the prudent, and help out all the rich people who strung along the idiots" variety?

What do I get from the "bailout" cash? If I get 5 cents, I'll be lucky.

Mortgage? Low-rate 30 year fixed.
Equity? 85% mine.

Just like in the 1970's, it's "ruin the people who behaved responsibly, and inflate away the debt" this time coupled with "and give money to the people who acted idiotically" at the same time.

I am just so impressed. But not in a good way.
Click to expand...
Agreed. Just wait though, more bailouts will come, I assure you. They're all ready seriously discussing bailing out the homeowners who took out loans they either didn't read or understand. On top of that, we had our yearly joke congressional hearing yesterday when the lawmakers haul all the CEOs of the major oil companies up to Capitol Hill and yell at them, in the process demonstrating how piss poor our Congressmen's knowledge of economics and business is.
 
I think this thread belongs in Social Issues/Current Events.
 
I don't see what's wrong with this. Prudent people don't need to be bailed out. That's the whole point of being prudent. You get out of this that the economy won't collapse upon itself. That's not as nice as having your mortgage refinanced with a lower principal, but it's certainly not nothing.
 
BPSCG said:
I think this thread belongs in Social Issues/Current Events.
Click to expand...

I think it's an election issue, hence it's here.

You must see the pandering here, both sides trying to make it look like they're doing more than the other guy for the imprudent and foolish, yes?


That's an election issue.
 
UserGoogol said:
I don't see what's wrong with this. Prudent people don't need to be bailed out. That's the whole point of being prudent. You get out of this that the economy won't collapse upon itself. That's not as nice as having your mortgage refinanced with a lower principal, but it's certainly not nothing.
Click to expand...

What we get is stagflation up the wazoo, and see all our assets get cut in about half value in the next few years thanks to this giveaway.

Look, lad, everything in this country scales to energy price after a time lag. EVERYTHING. Do the math yourself, I already did years ago (enough years that modern computers won't even print the graphs, dangnabit).

So just take your gas price, multiply the gas price increase into everything else. That's part of what this giveaway does to the prudent.

I fully expect the guilty banks to take it on the chin, too, and I expect the the politicians who are running the giveaway to pay for what they're doing out of their own pockets, not mine.

But, no, I'm not a libertarian, either. I know about the tragedy of the commons, unlike any serious libertarian I know of, so I do think that some support is called for. Just not this much, and certainly not this way.
 
Last edited:
UserGoogol said:
I don't see what's wrong with this. Prudent people don't need to be bailed out. That's the whole point of being prudent. You get out of this that the economy won't collapse upon itself. That's not as nice as having your mortgage refinanced with a lower principal, but it's certainly not nothing.
Click to expand...

Well, when properly functioning the market will weed out bad actors on its own (please, no Tom Cruise jokes). As an investment bank if you make stoopid decisions, you go bankrupt, goodbye. A high level of governmental support simply prevents the bad actors being properly punished by the market.

But, I expect you knew that. I think the issue here is one of degree. Some level of governmental safety net is necessary here to protect the economy as a whole. Also, some better/smarter regulation of investment banking should be in place to help keep things from building up to a point that they risk the entire economy. The wholesale bailouts people are talking about are a bit of an overreaction and, as pointed out, designed to win votes as much as anything else.
 
It wasn't quite a bailout. Bear Stearns is no longer independent, and the shareholders took a soaking.
 
boloboffin said:
It wasn't quite a bailout. Bear Stearns is no longer independent, and the shareholders took a soaking.
Click to expand...


I see the bailout as being far more widespread than just the Bear Stearns deal. I find the deal cut with the homebuilders to be far more upsetting, as they were the ones driving a lot of the original subprime mortgage signings. This press release is a bit histrionic, but it hits what I feel are the important points.

http://www.businesswire.com/portal/...d=news_view&newsLang=en&newsId=20080404005645
 
CFLarsen said:
Elect better politicians, then.
Click to expand...


You mean Nutjobs who are opposed to bail-outs and care about economics? No Way!
Won't happen unless the third lesbian atheist black women finishes her second presidential term. :)
 
Googol's right. Without a bailout you risk ending up with a seriously tanking economy, which effects everyone, even (especially?) the prudent.

Take the Northern Rock situation in the UK. If everyone who had money in that bank, or whose homes were partly owned by that bank via mortgages, was suddenly flat broke and / or homeless, the amount of liquidity in the economy would have plunged, driving down demand, price levels and asset values. This is happening anyway, of course, but if you think the alternative option would have made things better rather than just exacerbating the situation, I think you need to make the case.

Bailouts aren't really about "rewarding the idiot". Those people with their money in current accounts at Northern Rock weren't idiots or even unsophisticated or naive. They were just normal people who happened to make an unlucky decision about which bank to entrust with their money.
 
Last edited:
volatile said:
Googol's right. Without a bailout you risk ending up with a seriously tanking economy, which effects everyone, even (especially?) the prudent.

Take the Northern Rock situation in the UK. If everyone who had money in that bank, or whose homes were partly owned by that bank via mortgages, was suddenly flat broke and / or homeless, the amount of liquidity in the economy would have plunged, driving down demand, price levels and asset values. This is happening anyway, of course, but if you think the alternative option would have made things better rather than just exacerbating the situation, I think you need to make the case.

Bailouts aren't really about "rewarding the idiot". Those people with their money in current accounts at Northern Rock weren't idiots or even unsophisticated or naive. They were just normal people who happened to make an unlucky decision about which bank to entrust with their money.
Click to expand...


So it's clear, I don't think anyone is arguing about standard deposit insurance. I'm referring to the "refunds" that some taxpayers are getting, to the way that the mortgage market is being propped up (in terms of rewarding the stupid, and screwing the prudent), rather than simply protecting liquidity, which is a different issue altogether.

Yes, they are mildly linked, but when one repeatedly messes over the prudent, one gets what they pay for. :(
 
You must log in or register to reply here.

Back
Top Bottom