Short term obligations, your dreaming right. Generations to come will be affected by this, let them FAIL. Their is no fresh injection, this argument is only plausible if the U.S gooberment actually had the cash, and they do not.

You don't have a clue about what is happening do you?

The failure of Washington Mutual shows clearly what will happen if the bailout does not happen...

Other institutions will swoop in and gobble up the assets; this is the way the market is suppose to work...

The upside of NOT doing the bailout is we will not need to print up an additional 700,000,000,000,000 dollars further devaluing our dollar, causing the rates at which we borrow money as a country to go up, further causing increased debt and higher inflation...

So the bailout is good why?

The alternate plan sounds like a better idea.

Private industry would be asked to buy the non-performing mortgage backed securities as a long-term hold, and the government would back up the purchase with an insurance policy. The private purchasers of the securities would then have to pay an insurance premium to the government in exchange for the insurance guarantee on the securities.

This could essentially cost the taxpayers absolutely nothing at all.

That's 7 hundred trillion....

So a few too many zero's the premise is the same.

Quote:

The U.S. government is buying assets

.

I guess that is a matter of opinion. What assets are they buying? Are they getting delapitated, unusable strip malls, that will cost more to renovate or tear down than the land is worth, or are they buying houses that have been abandoned, stripped, and left to rot and mold?

As I stated in an earlier post, there are not enough people to buy all the houses available, even if these houses are in sellable condition. The ratio of homes to home owners is out of balance because of the housing boom created by cheap import labor and easy sign on the line credit.

When Quicken started advertizing zero interest loans for five years, I told my wife that there will be a huge amount of homes foreclosed when the interest rates reset. If I could see this, then why could Quicken not see this, and why could the home buyer not see this.

Quicken was not that stupid as to not know. They bundled the notes and sold them to investment banks and other such groups. Many are from overseas, but all had one thing in common. They were greedy, and did not do their homework as to what the terms of the loans were.

Now these groups are left holding the bag while the people who orginally made the loan took their profit and ran. The homeowner was dumb enough to think that a $200,000.00 loan with payments of $700.00 per month was a good deal. In five years they still owe $200,000.00, but now the payment is $2200.00 per month.

In order to take care of this they were told their house in five years, when the payment goes up, will be worth $500,000.00. The homeowner can refinance the house for the new value and pay off the old, now high payment note.

Who in their right mind would believe this bull. If you follow this logic, the homeowner now owes $500,000.00 on the $200,000.00 house. He has some money in his pocket from the increased equity, if the value does not fall that is, but the note is still higher.

Tell me how this kind of note is not designed to fail. The lender may be dumb, but surely not that stupid. The borrower is stupid to get into this.

The lended knew the deal would fall through, and they would end up with a house that was worth much more than the note, assuming that real estate would continue to increase at the then current rates.

Real estate fell instead of increasing, now here we are. We are now supposed to bail out the greedy, lying, cheating lenders, whose only motive was to make huge profits, at whatever the long term cost to the consumer and the economy.

Tell me again how much money the CEOs of the lenders made in golden parachutes when they left.

They made their money, to hell with everybody else. I say to hell with them.

This whole thing still smells to me. It is a deal to bail out rich immoral corporations and their big wigs, and to keep the foreigh investors from loseing money and calling in their US backed notes. I just hope underneath it all this was not a plan to allow foreign investors, with less than honorable intentions, a way to gain control of our economy by buying up our assets(land).

I'm not sure everyone around here has an appreciation for what the phrase "credit markets are frozen" actually means.

The root of this whole problem is the America home buyers.

Let's put blame squarely where it belongs.

This is where I disagree a little.

No one gets a loan or mortgage without the approval of the company loaning the money. They have fault here as well. They knew for sure how things worked and that in most cases they would not be able to pay the mortgage.

The original guy who sold the mortgage to the homeowner turns around and sells the mortgage to someone else. Then they sell it to somebody else, and so on and so on.

The first guy is off the hook, he got paid, as did everyone else up the chain. The Mortgage Backed Securities holders (Big Banks) are left holding the bag for the homeowner defaulting.

The big guys got burned and are saying "screw it, I'm holding onto my money now". So the small banks and businesses that usually are the one's who go to the big banks to get cash are being "frozen out".

It then goes down the food chain.