September 19th, 2008
02:15 PM GMT
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HONG KONG, China - You know what? At the risk of sounding like true believer, I think the credit crisis may actually be coming to an end.

The wild fluctuations on Wall Street left many traders scratching their heads this past week.
The wild fluctuations on Wall Street left many traders scratching their heads this past week.

Most people are saying it's far too early to call but look at it this way.

The credit crunch, as distinct from the U.S. economic slowdown, is happening largely because banks have been too scared to do their jobs ... lend to other each other. If they aren't doing that the flow of money circulating around the financial world is being cut off. We saw that happening this week.

The banks are afraid that the other party they are lending to may be riddled with the so-called "toxic holding," and be about to go under.

So what's the likely solution?  Take away all that toxic stuff. Actually buy it from the banks. After that, the banks can get back to basics, safe in the knowledge that they aren't doing business with an institution stuffed full of the ticking time bombs of property-backed financial instruments. No wonder stocks of investment banks around the world are having record one-day rises.

So ... who's the loser? Well, I'm glad I'm not a U.S. taxpayer. The estimates of exactly how much toxic stuff there is vary from tens of billions to hundreds of billions, even trillions. All of which will be bought by the U.S. government (i.e., U.S. the taxpayer).

They've done it before. In the 1980s the U.S. government bailed out the savings and loans companies who had hopelessly - and in some cases fraudulently - mismanaged their operations. That cost the U.S. taxpayer about $120 billion. That's nothing compared with what this one could be. Did the US government have a choice? Unfortunately, we will never know. They clearly thought they did not.

And that leaves the banks getting a giant get-out-of-jail card, and the poor U.S. taxpayer cleaning up the mess. Again.

soundoff (61 Responses)
  1. Jan K

    It is amazing that when millions of Americans were losing their homes, the government did not intervene substantially, but when Wall Street suffers from their own failings, it is there with hundreds of billions. This transfer of wealth is amazing to see while millions go without basic health care, proper education or now, even a home. Yes, saving the financial industry has its economic benefits, but health, education and basic stability have always has the highest ROIs.

    With Paulson looking out for the financial industry where he comes from, who is looking out for the average American?

    September 20, 2008 at 8:34 am |
  2. Sri

    Isnt it a great time for we taxpayers to pick up the bailed out stocks from market like FRE, FNM and AIG...which are sure to go up steadily..atleast this way we get to make some money.Wat say you??

    September 20, 2008 at 9:38 am |
  3. Jonas

    If you give the sick to much medicine it will die!

    September 20, 2008 at 9:54 am |
  4. Chris

    We, the people, must stop spending money we don't have, so financial institutions stop gambling with money that doesn't exist. Then governments don't need to bail out bad loans with our tax money.

    September 20, 2008 at 10:20 am |
  5. Scott in Berlin

    Did the US government have a choice? Yes it had a choice. The government had a choice not to relax banking regulation over the past 28 years. The government had a responsibility to the voters who put them in office. This responsibility is to watch out for the voters’ best interests. Unfortunately, voodoo economics and crony-capitalism paved the way for changes that were in the best interests for corporations and special interest groups, not the voters. Bush may have made many poor decisions while he was in the White House, but he isn’t the only one to blame for this mess. It started long ago. The part that is being overlooked is that the people who make changes to regulation in the economy are the people which are elected. The people who elect these officials, voters, also share some of the blame as well. Elections are not designed to be a popularity contest. People need to take them seriously and inform themselves about the candidates’ stances on economic issues. Would this have happened if Kerry or Gore where in the White House? One cannot say for sure. The risk was always there, regardless of the fall guy.

    September 20, 2008 at 11:27 am |
  6. MikeH

    Yes, a get-out-of-jail-free card. And a big fat one for Paulson himself, who owns over 500 million dollars of Goldman Sachs stock. That fact should be posted in every single story printed on this matter.

    September 20, 2008 at 11:31 am |
  7. Joe Cosgrove

    The people of America are being sold down the drain by our politicians. Our government of the people, by the people and for the people is no more. Big business has hijacked Washington. The national debt interest alone will comprise about 25% of our national budget and entitlements will be unaffordable in probably my lifetime. It is obvious that we have foxes watching our chickens.

    So long America, hello U.S.A. inc.

    September 20, 2008 at 12:50 pm |
  8. Jake Stock

    The US Federal banking system manufactures money out of nothing, making true on the wish of Mr. Amschel Rotheschild who said, "Give me control of the nation's supply and I care not who makes its laws." To this I would add or who foots the bill for Rotheschild style current financial market meltdown of 2008.

    The Federal banking system is perhaps the most astounding piece of sleight of hand ever invented in the history of the US economic system.

    Take away this great power of creating money out of the hand of the Fed and the Global economies would suffer a crises that would make the crash of 1929 look like a Monopoly game.

    And if US taxpayers want to continue to be slaves of the Federal banking system and pay the cost for there own slavery, then I say let bankers continue to create money and control credit to the demise of us all.

    September 20, 2008 at 1:16 pm |
  9. Sean Michael

    We've seen it all before. It looks a lot like 1976-1980.For those too young to know or remember. Change for the sake of change is seldom for the better. 1975-76 the U.S. was in turmoil, and people were demanding change. An obscure young man with good credentials(exceptional credentials compared to the aspirants today) championed the cause.1975 Carter sensed that the mood of the country was anti-Washington and that people were interested in a candidate offering change.On assuming office in 1977, President Carter inherited an economy that was slowly emerging from a recession. He had severely criticized former President Ford for his failures to control inflation and relieve unemployment, but after four years of the Carter presidency, both inflation and unemployment were considerably worse than at the time of his inauguration. The annual inflation rate rose from 4.8% in 1976 to 6.8% in 1977, 9% in 1978, 11% in 1979, and hovered around 12% at the time of the 1980 election campaign. Although Carter had pledged to eliminate federal deficits, the deficit for the fiscal year 1979 totaled $27.7 billion, and that for 1980 was nearly $59 billion. With approximately 8 million people out of work, the unemployment rate had leveled off to a nationwide average of about 7.7% by the time of the election campaign, but it was considerably higher in some industrial states.
    Carter also faced a drastic erosion of the value of the U.S. dollar in the international money markets, and many analysts blamed the decline on a large and persistent trade deficit, much of it a result of U.S. dependence on foreign oil.
    In July 1980, Carter received a favorable rating of only 21% in the Gallup Poll. That was the lowest rating any president, including Richard Nixon at the time of his resignation, had received since polling began in 1936.
    When Jimmy Carter left the White House in 1981 and handed the presidency over to Ronald Reagan, he was widely viewed as a failure. Carter, and the nation, had been humiliated by the long ordeal of the Iranian hostage crisis, as well as the botched rescue attempt that left Americans dead in the desert. The Soviets had brazenly invaded Afghanistan, and Carter’s response (including boycotting the 1980 Moscow Olympics) was seen as ineffectual. Carter’s tenure also witnessed an energy crisis, soaring inflation(11-12 percent), and skyrocketing interest rates(21.5 percent). The smiling, confident, fresh-faced Carter of 1976 seemed long gone, replaced by a growing national malaise.
    This not to mention the devastated military preparedness and income tax rates. Do we need to re-live this in 2008-2012?

    September 20, 2008 at 1:23 pm |
  10. Mark O'Shea

    TThe US Federal banking system manufactures money out of nothing, making true on the wish of Mr. Amschel Rotheschild who said, "Give me control of the nation's money supply and I care not who makes its laws." To his quote I would add, “or who foots the bill for the current financial market meltdown of 2008.

    The Federal banking system is perhaps the most astounding piece of sleight of hand ever invented in the history of the development of financial markets.

    Take away this great power of creating money from the Fed and the Global economies would suffer a crises that would make the crash of 1929 look like a Monopoly game.

    And if US taxpayers want to continue to be slaves of the Federal banking system and pay the cost for there own slavery, in the name of carrying the debt created through usury then I say let bankers continue to create money and control credit to the demise of us all.

    Munich, Germany

    September 20, 2008 at 1:24 pm |
  11. Emmanuel B

    Can people stop making noise about the American tax payer being the loser etc. They sat down and watched Wall Street greedily deplete the markets and stuff their pockets and did nothing about it. Today the rest of the world has to suffer for Americans greed. All tax payers monies are also being pumped into the markets to save The Americans from dragging the rest of the world into deoression. Americans have finally lost the last power hold that they have had on the world. With their military down to a toothless bull-dog and their financial power crumbling, a new world order is being called for without the USA of course

    September 20, 2008 at 2:06 pm |
  12. M Homayoun

    A rescue package of this size can not be just all good with no downside. The politicians are selling it to the public by providing full details of all the benefits that it will bring to the global economy. Surely there is a price to pay by our future geneation, who have to assume $700B of additional debt,. What effect will this have on inflation? Last time I checked the Feds did not have reserves of $700B. Is the Fed-reserve about to print $700B of money? This sort of intervention is very similar to what Robert Mugabe would do under the same circumstances.

    September 20, 2008 at 3:51 pm |
  13. Graham S.

    As an interested observer, and one who has experience in such things, America is losng her "way". The "brand" of previous generations was American know how and American craftsmanship. Pursuing this mad America strong. But now.....

    The Banks are in trouble...Your Banks are in trouble. If you haven't got a sense of it, Banks relate to sovereignty.

    The real problem being faced is that due to new paradigms embraced in previous decades, the Banking system has strayed from its structure. There is no deployment on the landscape to create effective cash circulation and I am concerned there are not enough people left in Banking that would even know what I'm talking about.

    So that being the case, I'll cut short the diatribe and get down to the meat of it.

    The Bill has gone to Congress and there's little that can be done about spilt milk.

    What can be done is the rapid deployment (using unemployed Bankers?) of economic development societies in all regions of the country to glean innovation from the landscape and rapidly commercialize ideas. America, like no other nation can mobilize itself around grand visions, so I know it can be done.

    Rebuild the rural, for in it lies the strength of the nation.

    Trust the People, for they are the nation.

    September 20, 2008 at 3:54 pm |
  14. Larry Pierce

    Now the search starts for the culprits. Short sellers are being blamed. But what about the architects of derivatives? These financial items are just fantasy. A market was created to buy and sell these things that did not exist, and that allowed a bad mortgage to be leveraged as many as 20 times.

    Who was minding the shop when these doomsday things were created? Derivatives caused the bankruptcy of Orange County. They were called 'financial instruments of mass destruction' in 2002 by Warren Buffet. So why were they not regulated better?

    And who profited from lending money on crazy terms ( balloon payments) to people who could not afford it? Normally banks lend money expecting to get it back. Not this time. Why?

    The fall out from this thing will go on for several years, and we will all suffer, not just Americans.

    Someone should be called to account for bad management of the financial markets and investment "banks."

    September 20, 2008 at 3:57 pm |
  15. Herb Magnusson

    The current bailout of banks from their overindulgence in risky credit
    reminds me of something that I learned in college 70 years ago: Communism is really State Capitalism. I never thought that I would see the day when the United States of Smerica would take this plunge, especially under a Republican administration. I should have known better ! ! !

    September 20, 2008 at 4:41 pm |
  16. Johann M

    Excellent! The profits remain with the bankers and the losses with the taxpayer. – This is not only unfair, it is also a recipe for the next desaster. Why not start the next get-rich scheme if you know that others will pay the bill in the end?

    If anything, the people who can't pay their loans should be supported. That would help the banks, but leave them with some of the cost.

    September 20, 2008 at 4:42 pm |
  17. Mike Trachtenberg

    From Andrew Sevens, CNN Correspondent. "Bailout — and giant tax bill — was only alternative" This article paints the fairy tale story we will be getting in the days and weeks ahead. "Couldn't be helped" , "Was the best thing to do", with no accountability for the crisis, and no real investigation to assign culpability. Unless you will subscribe to the disinformation, that it was the US taxpayer who caused this, and so it is only fair that they suffer the consequences. Despite Mr. Stevens fairy tale view of this outrageous crisis, and his beleif that the end is near, there are still many shoes to drop , as they say, not the least of which is the enormous amounts of credit card debt that is going into default. The country in debt, the taxpayer in debt, the financial world not only unable to cope, but coming now to add its enormous 'toxic' debt onto the pile. While Mr Stevens may see the end in sight , I am suggesting the supposed light at the end of the tunnel is more likely an oncoming train. My advice hold on, you aint seen nothin yet.

    September 20, 2008 at 8:55 pm |
  18. Jimmy Rendalll

    Fix the debt problem with more debt, that's sure to work huh.

    The U.S govt is already 4 trillion in debt, so whats another trillion or two right? And when those idiots in the treasury dept have lost their jobs for completely destroying the economy maybe they can go and fix the roads or something, a bit of work would do them good.

    September 21, 2008 at 12:02 am |
  19. vinu

    The "toxic holding" of the banks is just as toxic when the government debt goes up to 11-12 trillion dollars.

    The banks should be allowed to fail. Let the market do its work.
    The government does not step in to halt irrational exuberance during a boom. Why stop the blood flow during a bust?

    September 21, 2008 at 1:18 am |
  20. Tom

    Good to see that the top down approach to fixing things, is still the status quo in the US. The execs will keep all the money they earned during this time, the corporations in a few years will be back to where they were, righted after all the wrongs they encountered. However, the US taxpayer, you know, that large struggling middle class America, will foot the bill for decades to come thanks to an overbearing, greedy corporate America centered around Wall Street and Washington D.C. Its so refreshing to see that hundreds of billions of dollars, perhaps up into the trillion range, will be used to 'solve' this credit crisis, and 'save' these banks. Instead of giving it back to the taxpayers do prop up their incomes when needed, its now plain to see where the priorities of this government lies, business, and no one else. (oh and thanks for that $500 dollar tax rebate, really helped out.... yeah, right.)

    September 21, 2008 at 1:42 am |
  21. abbas

    who does the U.S. govt comes in when there is trouble for the big boys who pay themselves millions and then walk away with rich rewards. i feel this time let all of them fail and go to the dust i know it will husrt millions but atleast we will have a clean shhet of few high quality banks wo will be careful to pay big dividends to drive customers away and gamble heavily in high risk false investment. we will suffer for atleast a year so what was noth e 1929/1930 depression bad where people did not even have food to eat. these 700 bio bail out give the normal americans who work all their life and when comes retirement time see their govt bail out big boys cause they are the big donors. by letting the big guns fail the ordiary citizen who suffers bail them out. NO MORE BAILOUTS ITS BECOME A HABBIT AND A JOKE.

    September 21, 2008 at 3:18 am |
  22. Jonathan

    The thing is that it seems impossible for any politician of either main party to actually suggest that taxes have to go UP. I mean, economic ignoramus that I am, I thought the US budget deficit was already big news, what with the trillion dollar war and all, and now, hey, we've just bouth another trillion dollars worth of trouble on top. So tell me, is the US government 'too big to fall'? Do they have infinite money? Can they just write checks and make it all go away? Or are the actual taxpayers going to have to ante up with this money?

    September 21, 2008 at 7:34 am |
  23. Chris Fehmers, the Netherlands

    I really can't understand your presumption that it should be the poor US taxpayers to clean up the mess.
    Why don't you charge – fully and entirely – the super rich who are responsible for the mess in the first place?
    As a group they can afford it easily without going broke.
    Your country counts thousands of bilionnairs, not to speak of hedge fund manipulators who "earned" more than a 1 billion a YEAR, whilst recking your entire banking system...
    And still you consider it a problem for ALL the US taxpayers ???
    Why do you accept so sullenly that the ones who created the mess and who can afford to clean it, should be bailed out by the American taxpayers ?
    Why add insult to injury ?
    I wish I could understand why the US taxpayers want to victimize themselves.

    September 21, 2008 at 9:15 am |
  24. Ven

    As the popular say " Rob the Peter to pay Paul" is what the US govt has attempted to stall the finaicial crisis for time being.Tax payers are silent majority who ultimately become the victims of Bankers adventurism.Fund managers can get away with their dare devilry and with any accountability.Hardly any body knows who they are and what is their net worthiness.Ofcourse fools need not bother on their misadventure as the sayings goes Fools rush in where Angels fears to thread.Any way it is Tax Payers money and they can seek new pasteurs to hoodwink and try their pet theories.

    September 21, 2008 at 11:09 am |
  25. chatto

    Huge investment banks have to be accountable for their financial tinkering creating all this toxic debt, let them burn. They have reduced the average home owner into a statistical probability for their gain for too long. How much have they made in the ride to the top? Now the people they have ridden have to bail them out, come on. Its high time there was a re-shuffling of this house of cards.

    September 21, 2008 at 11:51 am |
  26. Tom Evslin

    Bailouts should be treated like a special case of bankruptcy: no compensation over $1million/year for anyone in the receiving firm, no golden parachutes, no payments on old golden parachutes – things that would've happened if these institutions were allowed to go bankrupt. Also no dividends for a year.

    more at

    September 21, 2008 at 1:36 pm |
  27. jaime

    why are we "bailing out" the people who got us in to this situation in the first place? this is ridiculous!
    if we let the economy and housing market NORMALIZE – and, rtn to where it should be – people could get on with their lives. TOO BAD if the people who got us in to this mess take a hit. they made their money by taking a risk – now, the risk to benefit ratio has turned. that's why they call it risk. take the good wit h the bad. i don't see why this is such a hard thing to understand.
    we are building debt, weakening the dollar, increasing inflation, and have no plan to resolve the situation.
    i believe we should let the market take care of itself. if companies go under, one will come up in the future. it's natural progression. learn from our mistakes. don't fix it for them – no one will learn!!!

    September 21, 2008 at 4:08 pm |
  28. Mark in Dallas

    Main Street bailing out Wall Street? You have got to be kidding me! They've gambled with the money made from hard working Americans and lost. Now they want another handout? Tell Wall Street to donate their million dollar bonuses to their own bailout. The rest of us have no problem getting up tomorrow to put in an honest days work to rebuild the American economy.

    September 21, 2008 at 9:42 pm |
  29. Calvin Lim

    The US Government and proxy institutions such as World Bank & IMF have been preaching to trust the markets to do its work and not bail out companies including financial institutions. Now, seeing its financial institutions crumbling, it is going against its own teachings. If the US Government stepped in to rescue the banks now, the banks will not learn how to earn profits in a conservative and responsible manner. The people who profited from the boom years does not have to pay for the risk that they took. The only lesson that they will have learnt is if you take risks, take it in such large quantum that if you fail, you will endanger the system, then the US Government will rescue the entity. The US taxpayers will pay for it again, and again ...

    September 21, 2008 at 11:00 pm |
  30. Xcalibar

    Don't Bail out these idiots, It isn't part of the free market to save the asses of idiots who ruin their business. Let them sink. It creates a vacuum and new businesses arise. That is the free market. NO DAMN BAILOUT is going to stop these management fiascos, only the stock holders should be able to do that, Stockholders enjoyed the dividends nowthey can't bear the losses.
    It is time to uphold the US Constitution, The executive branch of the US does not have the authority to forgive debt. Nor does it have the authority to place the entire country in jeopardy.

    Something is broken, Too bad we don't have the leadership in the LEGISLATIVE BRANCH to their job.

    September 22, 2008 at 1:46 am |
  31. Andreas Braun

    even after the bailout housing prices are still out of proportion compared to personal income. Another wave of depreciation will come, another increase of foreclosures will come, another credit crisis will come, another bailout will come. The question is if the USA can afford this? Should we initiate more wars to distract from home made problems? That might be the solution! So let's vote for McCain he has the guts to fix the problem.

    September 22, 2008 at 1:56 am |
  32. gil cottrell

    Then why are corporate chiefs of FAILING companies getting MASSIVE checks when their companies are losing BILLIONS? Merril Lynch' gets 47 million for 9 months of the companie going under? This is CRAZY. ANY financial LOSES money should mean NO BONUS this year buddy!!!!

    September 22, 2008 at 2:09 am |
  33. Ralph Peoria, Il

    JANUARY 20TH, 2009

    GOD WILLING............."The End of an ERROR" Bush will be gone.

    Regardless of your party, you should E-mail all your representatives and tell them you will no longer tolerate this "White Collar Crime"

    September 22, 2008 at 3:20 am |
  34. Rod

    Being ripped off twice. Once by Wall Street and again by the Fed. How long can the country afford to believe the lies, while the modern day mining/ piracy of America continues. A lot of people need to go jail for this mess. Paulson's right about dealing with this now, but I disagree with emergency funding, with changes to the "system" to follow, maybe never, later. Lies for promises. I'd like to see news stories of people being arrested and taken to jail. Who is really worse, the guy that took your car or the guy that took your pension and your future. We seem to be able to lock up the guy that stole the car, but somehow seem that it's reasonable to reward the guys that steal your investments and your future. Follow the money and you'll find those responsible. Use their money, not mine. That's what they do. They should be dumped, to wander penniless on the streets, like so many others will do as a result of the greedy. Finally, how long can we continue to fund our wars, helping the ungrateful?

    September 22, 2008 at 8:24 am |
  35. Nathan Guernsey

    I have a better idea concerning what we could do with the $700 Billion the government is using to bailout the big corporations. Instead of propping them up and basically giving them future chance to do much of the same, we could use every bit of that money towards instituting a Universal Healthcare System within the U.S. As a father of 2, I know how impossibly hard it is to afford insurance for my children, let alone myself. I do not have health coverage for me or my wife just so our children can be covered. That money could be put to use in providing everyone in this country with the care they need. I guarantee if you ask any taxpayer which they would prefer to use their tax dollars towards, you would receive a 95% or more response towards instituting Universal Healthcare. This situation seems to show that, at the end of the day, the government would rather bailout big business then help regular people like you and I.

    September 22, 2008 at 1:09 pm |
  36. Rick E

    I will be extremely offended by any support for a credit bail-out package at the taxpayers expense. Why should people who spent beyond their means be rewarded for being idiots at the expense of those who acted more responsibly? And why should shareholders in companies who backed these ridiculous loans get their backsides covered by taxpayers who invested more judiciously.

    I would support a separate plan to bundle bad loans in tranches and sell them off similar to the RTC as long as it does not involve taxpayer's money. Do NOT penalize us because investors backed mortgage holders who bought beyond their means. If they get a break, we should get an even bigger break. Otherwise this plan will create a total loss of confidence in our financial markets and work ethics.

    September 22, 2008 at 6:09 pm |
  37. Rick E

    I and countless others have lost billions of dollars in Vegas over the past eight years. Will the feds cover our losses and bail-out those who bet the house on the tables there and lost?

    September 22, 2008 at 6:11 pm |

    Wake up people, this is a scam orchastraited by the federal reserve and the bankers on the benefit of the richest elite families( i.e. Rothschilds, Rockefellers, Kissingers) in the world. They leveraged all those bad loans a thousand times over and took the profits and bought real assets and now they are leaving the taxpayer to fit the bill. We must not let them get away with bankrupting this country.

    Say no to this bail out. These bankers have committed fruad and now they are using the bush administration and congress who they paided off to sell us this get of jail free bail out card.

    September 22, 2008 at 6:43 pm |

    People if congress approves this bailout we are headed for a deep financial depression, one that will make the 1929 crash look like an economic boom. Just Imagine a lot of people in those days had farms or grew their own food. Very few people do that today.

    And now the U.S. is starting to deploy troops right here in America to deal with insurrection and riots. These elites who orchastraited this robbery are now taking the money and fleeing and when the taxpayer finds out what they have done and start to riot they are going to have the troops machine gun us down in the street.

    September 22, 2008 at 6:56 pm |
  40. Steve Mierzejewski

    Speculation, by definition, contains an element of risk. Bankers are not stupid people. They knew the risk that went with giving loans to questionable clients. Yes, good bankers worried about this. They worried that their banks and their jobs may be in danger from such risky behavior. But there was money to be made here. And so banking became a profession of risk management. Why not bundle the risk with securities and sell it on to others? This would certainly spread the risk around. But you can dilute poison all you want. Eventually, it will kill you. Now, the question is: how many others will they take down with them? Let those who invested in risk suffer the consequences. However, there is no logic in passing laws that allow them to take down hardworking, non risk-taking taxpayers who had no part in this crime.

    September 23, 2008 at 6:32 am |
  41. Paula

    They have no idea what caused all this to begin with. Yes I agree with what the houseing lenders did was wrong, but Once the Fuel costs went skyhigh at 4.00 a gallon is when people started getting into to trouble.. so supplement the fuel costs instead of bailing these companies out. So fuel prices go down and food prices go down so people can afford thier homes. That is what got us into trouble to begin with. That is why people cannot afford these homes at all. Put the money in the fuel companies and lower the gas costs for everyone...Then your economy will work better...Why can't our goverment see this.. We are going to breakdown again because the costs of living still keeps going up.. We all have to live somewhere..
    Please tell me someone else can see this point...

    September 23, 2008 at 11:29 am |
  42. gerry moore

    It is my belief that the people responsible for our failing economy should not get a dime from the bailout, if it happens. They need to be disbarred, if they are lawyers, have their licences revoked, so that they can't work on wall street and the bankers should not be able to work in the finantial world, ever.

    Everyone found guilty for this mess should get lengthy prison terms, in all, everyone responsible, be ruined, like they are ruining us.

    September 23, 2008 at 9:20 pm |
  43. Pat Condlin

    noone talks about the credit crunch on the individual taxpayers like the ones that are losing their home. Their credit is ruined now for at least the next 3 to 7 years because of the 3 credit bureaus now have them posted with 30,60, 90 day lates and sometime a foreclosuer. They can't refinance because their credit score is ruined and doesn't meet the credit requirements. Why do I never see this consumer information given out on CNN? Lets tell the whole truth about how the individual taxpayers are going to be hurt with this bailout and real credit issue. It's a shame we in the media do not tell the whole truth when discussing the whole situation.

    September 24, 2008 at 12:37 pm |
  44. cricketdiane

    It is possible that solutions exist which can maintain our capitalism and the integrity of our system of government.

    What I don't understand is why the value of the integrity involved in these first principles of our America – our United States – don't matter to President Bush and Nancy Pelosi and to others involved.

    What could possibly be important enough to do only in one certain way, at the cost of the very foundations upon which their authority rests and our freedoms are assured?

    Aren't they the ones charged with protecting it by oath of office and by virtue of trust well-placed in them to do so?

    September 25, 2008 at 8:08 am |
  45. Debra Pulley

    Very simple...Give them the $700 billion. Give us, the tax payers 4% loans on mortgages, car loans, business loans, and credit cards. This would put money back where it belongs, in the pockets of the tax payers. It would be better if all americans paid their mortgages at 4%, then 50% of americans paying their mortgages at 6%. Basic math!

    Average American,
    Camas, Wa

    September 25, 2008 at 2:36 pm |
  46. Angel1

    Does anyone know if the proposed bailout is to purchase all this toxic paper at the current MTM value or at par? Surely, it must be the former otherwise its going to be one royal pay day for the bankers that created this rubbish in the first place. Of course if it is the former the chances are most holders of these so called "assets" won't sell at current MTM values, or alternatively, the Fed may actually make money out of the bail out as and when the market recovers and/or if the securities continue to perform to maturity.

    I believe the figure $700billion is more to bring confidence back in the markets than what is actually needed or ever will be used.

    Whatever the decision of the Congress, one thing is for sure, greater supervision is required all around. No more holding assets on banking books against which reserves are not to required to be maintained. No more pension funds investing in unrated paper or below investment grade paper. No more debt traded a hundred times over its actual value by way of derivatives or synthetic structures and so on so forth ......

    September 25, 2008 at 3:11 pm |
  47. sanjeev

    i guess this is probably the last chance to get things under control or loose it for the next decade !!

    if the white house is so keen to give a break , than why not , the govt decide not to collect any personal income taxes at all for the year and next two years fr americans ? that will put the money where its needed most – in pockets of oridinary americans !!

    but i guess , an ordinary american does not hv a lobbyist working for him or her in the DC – so suffer you must !! and so would we !!

    September 27, 2008 at 11:59 am |
  48. ferdinand ho

    To save Main Street, bailout money should be paid over directly to Main Street, not to Wall Street. When money is used to buy the dubious assets of Wall Street, the Wall Street gamblers will probably gamble on with the proceeds, in the hope to win on the next dice and hence a bonus. Only a small remainder will seep through to Main Street. The $700 billion ought to be earmarked for Main Street and Main Street only. Main Street may apply for credit from Uncle Sam via the commercial banks.

    September 28, 2008 at 12:19 am |
  49. Weatherman

    Let the dollar crash. Buy back USA from all the foreign owners with gold. After that restart the game and the sun will shine again.

    September 29, 2008 at 7:30 am |
  50. Tariq Saleim

    Incompetance of rating companies is being totally neglected. Instruments and insitutions which are illiquid and bankrupt today, were mostly trading as "Investment Grade" assets shortly before they went bankrupt. Sub-prime did not happen in one day. It started couple of years back. Investors and markets were given wrong signals, analysis and directions over a period of time by almost all rating agencies. While bankers are to be blamed; I feel rating agencies are being allowed to go escort free. Why is it so? Because they had "appropriate disclaimers" in their reports. Is that fair? There is a need for imposing stronger regulations on rating agencies and heavy penalities for not doing their homework correct.

    September 29, 2008 at 8:25 am |
  51. Rack Rell

    The current crisis was brought on by Wall Street greed and the failure of regulatory institutions to do their job.
    CNN – among others, never bothered to investigate and question the housing bubble, it just went along and 'happily reported'. All three, Wall Street, Government and CNN failed the people. What bothers tax paying citizens is that we were all duped.

    September 29, 2008 at 2:04 pm |
  52. Ronald de Bont

    first of all the bail-out should only be effective for banks that went bankrupt. not for B of A or Citycorp. Second those greedy CEO's and boardmembers should be investigated for fraud. the greediness should be stopped. no golden parachuttes.

    September 29, 2008 at 4:10 pm |
  53. Don

    Well, maybe this $700 billion solution is not the only game in town?
    How would a $30 billion loan fix sound?

    Currently we are concerned about the effect of the mortgages on the banks, right? Those mortgages are not performing. Well first we arrange to have them paid up and performing! Voila!! Now the assets are no longer toxic and we taxpayers are not stuck with Wall St. derivative cunning deals. Next we have mortgage adjusted to reflect current market value and have the writedown set as another mortgage for the asset. (ranked ahead of the original mortgage, government guaranteed and paying nil interest).
    Result is?? People stay in their homes, Price depressing situation is removed. Banks lose their 'fraidy cat' moan factor. Dress this up with Banks wearing the problem and legislators make it all legal.

    Conclusion we fix the delinquency problem and don't have to pick up the principal.
    Could be we have great minds fixing the wrong problem (bank asset values) rather than mortgage value problem? Fixing this costs less and keeps families at home.

    Isn't this worth a try?

    September 29, 2008 at 10:38 pm |


    September 30, 2008 at 3:01 am |


    September 30, 2008 at 3:04 am |
  56. Ashwin Ramcharan

    What we see is the result of greed instinct of human beings. When we were living in caves we gathered as much nuts as we can, through this greed instinct.

    Now some dominant Alpha males have been gathering money instead of nuts to the extend that, through governance manipulations, they have broken the system.

    Greed has a function in human beings, greed is here to stay, greed is good, greed is what we need it to survive!

    Ashwin Ramcharan

    October 10, 2008 at 8:19 am |
  57. Joa

    For as long as american automakers do not improve quality, let them go under!!! They simply don't deserve better. Keep building trucks and other gas guzzlers.
    Japanese and European automakers use surgical tools and work with hundreds of millimeters – Americans still use hammers to make it fit, and work in a fractions of inches, absolutely ridiculous. Have you not realized that we're in the 21st century?
    Germans and Japanese show clearly that US manufacturing works with their plants in the US but with their production standards, so why can't AMERICAN car companies do the same?
    They raked in Billions in the past with cheapest cars that can't match quality in foreign cars. Any Hyunday or KIA is better built. Shame on those greedy and lousy managers at GM, Ford and Chrysler.
    Even NASCAR is racing cars with Carburetors and 50 year old pushrod engines!!!!!! For heavens sake, we threw out this technology some 40 years ago already. The top of the line Corvette of 2008 still uses a V8 pushrod that is basically the same small block engine of 1953, and that was outdated 10 years later. We use today direct fuel injection, overhead cam engines – ever heard of such things? Just keep producing cheap cars and ask top dollars for it. The rescue of them won't work, they just go under in 3 years anyway. It's not the market, it's the lousy and greedy management and their mediocre products that causes the demise of a fantastic industry.

    And here is another one: You put men on the moon in 1969 – but you can't make use of solar technology in the southwest, where you have 330 days of permanent sunshine..... go figure. You have a power grid that uses technology that was old some 50 years ago.

    Instead of killing Mother Nature by drilling more and more, you ought to honor her by utilzing what she offers you for free in the whole southwest. A few dozen square miles of solar energy plants would solve the problem once and for all.


    November 12, 2008 at 9:04 am |
  58. ramani

    Dear Andrew

    There is a factual error in your comments about Indian Railways. Your correspondent says that most of the tracks were laid in British daysand creeking. He has not bothered to chek facts with Railway board. Tracks in British days were laid on wooden sleepers and meant for 40 miles per hour speed with 6 m long rails. All these tracks running to thousands of kms have been replaced at least three times since . Current tracks are state of art tracks laid on pre stressed concrete sleepers with long continously welded trails for speeds up to 150 kmph. CNN can not afford to make such factual errors. The entire track system left by the English have been replaced three times over in the last 30 years

    November 26, 2008 at 12:55 pm |
  59. Roxanna

    What's it take to become a sublime exuponedr of prose like yourself?

    November 9, 2011 at 4:38 am |
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