chonkoa
Aerodynamic Artisan
as long you don't have a loan or stocks, everything is great..
Yes that's me..
Tell me about the stocks aspect of it.
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Politics Are we heading for a global economic collapse?
- Thread starter SDNR
- Start date
Tell me about the stocks aspect of it.
DaSilva
Autotechnik Ace
tell me about the stocks aspect of it.
0 = 0
D
Deleted member 182
If you saw in a local supermarket a loaf of bread for the price of 0 $, would you take it?
DaSilva
Autotechnik Ace
Centurion
Apex Apex Predator
To some degree I agree with the Joneses. Between 2004-2007 the western economy was enjoying a boom of escalating house prices and lucrative investments on the stock exchange. Money was raining down on everyone with top bank execs cashing in annual bonuses in the €80-200 000 000 region. Share holders got to taste the cake as well getting handed generous dividends.
The industry got greedy and blinded by success believe refusing to slow down on investments and increased salaries. No when things have turned down for the worse the banks have no funds to cover up for losses since hardly retained much of their profits. That is much of the reason why the Federal reserve and US government have to limp in and correct the mistakes committed by the banks. In other words the banks bailed out are now operating normally with top execs suffering any financial consequences.
Obviously the US government couldn't have let big banks fall since it would create a meltdown. The banking system is very much based on trust and if a bank is troubled people are generally quick to take out their money unless the bank issues a calming press release. If a bank is left alone to fall people would panic as soon as another bank has financial issues. The panic would result in the bank collapsing in no time since it would be forced to liquidate their assets at bargain prices in order to give people back their money. A massive flow of people trying to withdraw their money is the most severe path to death for a bank.
This is the reason why government bail banks out, to restore people's trust in bank and that their money deposited won't disappear in thin air. After all, we saw what happened after Enron fall and not bailing all of these banks out would have ended in an even bigger disaster.
Gullwing
Chicane Challenger
Yes things will get worse even if wall street is "fixed". All other parts of the economy need to "adjust" to these changes.
Mr. Mercedes
Premium
I agree. It all seems like desperate band aid measures. Will this really help the market correct itself? Forking out bucket loads of cash. How about some STRONGER regulation over the ludicrous 'wealth' mechanisms that have lead to this problem.
And Wall street booms yet again after they announce the plan. When will they ever learn!?!
What's the general feeling over there in the US amongst 'Main Street'? Panic? What are the papers saying (the media can have a massive effect on the final outcome!)?
This cowboy has managed to double US debt to around 11 trillion dollars during his time and he still thinks his country can afford his war mongering ways. Hey let's print another 700 billion.
Don't worry, this global (transfer of wealth) has been in the making for many years! Furthermore ther's not enough hours on a clock for us to even prick the surface on this topic!
SDNR
Kraftwagen König
Talks Falter on Bailout Deal
A renegade bloc of Republicans moved to reshape a massive bailout of the U.S. financial system yesterday, surprising and angering the Bush administration and congressional leaders who hours earlier announced agreement on the "fundamentals" of a deal.
At a meeting at the White House that included President Bush, top lawmakers and both presidential candidates, House Minority Leader John A. Boehner (R-Ohio) floated a new plan for addressing the crisis that has hobbled global markets.
Democrats accused Boehner of acting on behalf of GOP presidential candidate Sen. John McCain (Ariz.) in trying to disrupt a developing consensus. The new proposal also displeased White House officials, including Treasury Secretary Henry M. Paulson Jr., who chased after Democrats leaving the meeting and -- half-jokingly -- dropped to one knee and pleaded with them not to "blow up" the $700 billion deal, according to people present at the meeting.
Before the meeting broke up, President Bush had issued a stark warning about the impact on the nation's economy if the measure did not pass. "If money isn't loosened up, this sucker could go down," Bush said, according to one person in the room.
Under the alternative Republican plan, the government would set up an expanded insurance system, financed by the banks, that would rescue individual home mortgages. The government would not have to buy up the toxic mortgage-backed assets that are weighing down financial institutions.
Paulson and Federal Reserve Chairman Ben S. Bernanke had already considered and discarded a similar idea, White House spokesman Tony Fratto said. "I'm not convinced it does what needs to be done for the banking system, and neither is Secretary Paulson or Fed Chairman Bernanke," he said.
Last night, after the White House meeting, Paulson shuttled back to the Capitol for a nearly two-hour meeting with Democrats and Senate Republicans, and the sides began drafting legislation based on the general agreement struck earlier in the day. That effort will continue this morning.
Democrats say they would not approve the legislation without a significant number of Republican votes to share in any political fallout from the controversial proposal, which comes just weeks before the November election. "We are working to try to get this bill ready, but if House Republicans continue to reject the president's approach, then there's no bill," said Rep. Barney Frank (D-Mass.), an architect of the bailout legislation. "We told Paulson the whole thing is at risk if the president can't get his own party to participate."
"We've not seen any way to getting majority [Republican] support," said Rep. Eric Cantor (Va.), a leading Republican vote counter and co-author of the alternative House GOP plan, which would also cut taxes on dividends and capital gains.
The apparent breakdown yesterday followed a lunchtime declaration by Republicans and Democrats in the Senate banking and the House Financial Services committees that they had come to a general accord on many outstanding issues. During a nearly three-hour meeting, lawmakers reached an "agreement on principles."
Under that agreement, the package would be broken into three parts. Paulson would receive $250 billion immediately and $100 billion more upon certification that the funds are necessary. The final $350 billion could be dispersed without additional congressional approval, but Congress would be given 30 days to object.
The agreement calls for strong oversight of the bailout program, including an independent inspector general and regular audits by the Government Accountability Office. It also would require the Treasury to set standards to ban "inappropriate or excessive" compensation for executives at participating firms and establish stronger protections for taxpayers, including a requirement that they receive equity in all participating companies. The latter provision ensures that the Treasury could recover the cash it invests in bad assets if the firms return to financial health.
If the nation profits from the program, the agreement calls for most of the cash to be dedicated to deficit reduction, though a portion would go to funding affordable housing.
Frank said the primary remaining point of contention between Democrats and Republicans is a proposal to give bankruptcy judges new power to modify mortgages for troubled homeowners, an idea that is widely viewed as a bargaining chip. Democratic presidential candidate Sen. Barack Obama (Ill.) has said the provision, which is fiercely opposed by the banking industry, should not be included in the bill.
Meanwhile, House Democrats said they were still considering a separate plan to increase taxes to pay for a portion of the bailout, possibly by taxing stock transfers or levying a "surtax" on millionaires. But Democrats had agreed that any tax increase would not be included in the bailout bill.
Despite those stumbling blocks, Sen. Robert F. Bennett (R-Utah), the chief negotiator for Senate Republicans, said early in the day that he was optimistic. "I now expect we will indeed have a plan that will pass the House, pass the Senate and be signed by the president and bring a sense of certainty to this crisis," Bennett said.
"We've reached fundamental agreement on a set of principles," said Sen. Christopher J. Dodd (D-Conn.), chairman of the Senate banking committee, adding that a bill could pass within days.
Less than 30 minutes later, however, Rep. Spencer Bachus (R-Ala.), who had attended the meeting on behalf of House Republicans, denied that an agreement had been reached. While progress was made on peripheral issues, Bachus said, House Republicans remained adamantly opposed to the central point of the plan: purchasing bad assets from struggling firms.
"There's not a deal. There's not a deal made. There was progress on the issues," Bachus told reporters. He said House Republicans "would prefer a loan where we fix an interest rate or we would prefer insurance" rather than having the government buy up bad assets.
Bachus said many of those ideas were supported by McCain, who returned to Washington yesterday to participate in the negotiations. Bachus said he spoke to McCain on Wednesday, had breakfast yesterday with two McCain advisers and spoke to McCain again immediately after the morning meeting.
But, Bachus said, "John's not trying to call the shots for the House caucus, I can tell you that. He's just opposed to the plan in its present form."
Frank reacted angrily to Bachus's remarks, saying lawmakers had been well on their way toward a bill they could put to a vote and accusing McCain of engineering a breakdown. "This is the presidential campaign of John McCain undermining what Hank Paulson tells us is essential for the country," he said.
Frank was in a fury as he and other Democrats departed for the late-afternoon meeting at the White House, a remarkable event given Bush's efforts to stay out of the presidential campaign.
Despite expectations that a deal was near, Boehner took off in a different direction during the meeting, saying the bailout plan was not gaining traction among rank-and-file House Republicans.
As Obama and Frank peppered Boehner with questions about the new proposal, Bush rejected the idea as a too-broad rewrite of his administration's plan, according to the handwritten notes of one Democrat present.
"Don't start over," Bush said. "Don't start over."
Talks Falter on Bailout Deal - washingtonpost.com
Gullwing
Chicane Challenger
Today we found out about the family we know with three homes. They just got two eviction notices, one they have ten days, the other is immediate. The third house might also get taken back (sucks for the renters).
Out on there ass because the mom is a moron and dad didn't stop her. They are moving to a crappy part of town for now, not sure what exactly, and we heard something about leaving the country. One son leaves for Afghanistan in a few weeks, what will he come back to?
Out on there ass because the mom is a moron and dad didn't stop her. They are moving to a crappy part of town for now, not sure what exactly, and we heard something about leaving the country. One son leaves for Afghanistan in a few weeks, what will he come back to?
Mr. Mercedes
Premium
Hey Australia ROCKS!
Come on now, you know you dream of being an American every day!
Potential
Autobahn Adventurer
Australia's governments are just as pathetic as the monkeys running the United States. This week in parliament one of the most important topics introduced was cost of food at the cafeteria compared to dealing with the impending financial break down of the world market and the ever ailing condition of our public health systems...
SDNR
Kraftwagen König
House Votes Down Rescue Plan
The House of Representatives voted down the $700 billion financial bailout package Monday afternoon, sending stocks into a freefall.
As reports of the vote -- 207 in favor of the measure and 227 against it -- came trickling into Wall Street, the Dow Jones Industrial Average plunged more than 570 points.
House leaders that helped draft the measure were trying to convince the naysayers to change their vote on the measure, which is unpopular among some lawmakers' constituents. Conservative Republicans in the House had been critical of the initial measure, saying it did too much to help Wall Street and not enough to help the average American consumer.
The legislation was intended to allow the government to buy up toxic mortgage-related securities clogging up bank balance sheets. It would represent the biggest government intervention in the nation's financial markets since the Great Depression.
The measure was slated for a Senate vote on Wednesday. It is unclear whether it will need a complete renegotiation and overhaul, or whether House members who supported the bill would be able to convince enough of their counterparts to approve the measure.
While top lawmakers and the Bush administration seemed confident that the proposal had been altered enough to gain approval, apparently not enough were swayed.
"I fully understand that this will be a difficult vote," President George Bush said before the vote Monday morning, according to a transcript of his remarks. "But with the improvements made to this bill, I'm confident that members of both parties will support it. Congress can send a strong signal to markets at home and abroad by passing this bill promptly. Every member of Congress and every American should keep in mind: A vote for this bill is a vote to prevent economic damage to you and your community.
Federal Reserve Chairman Ben Bernanke, in a statement issued Monday morning, praised Congress and the Bush administration for working out an agreement.
"This legislation should help to restore the flow of credit to households and businesses that is essential for economic growth and job creation, while at the same time affording strong and necessary protections for taxpayers," the Fed chairman said.
Bernanke also said the central bank supported "timely actions" taken by the Federal Deposit Insurance Corp. to support "financial and economic stability," a reference to the FDIC's brokering of a deal of Wachovia's (WB Quote - Cramer on WB - Stock Picks) banking operations to Citigroup (C Quote - Cramer on C - Stock Picks).
Congressional leaders put the finishing touches on legislation over the weekend, after several contentious days of negotiations, according to media reports.
The Treasury and the Federal Reserve had been pressing Congress for more than a week to grant Treasury the authority to relieve banks of soured assets. The plan is aimed at stabilizing the credit markets, which have essentially frozen in recent days, and preventing the financial crisis from claiming more banks and further damaging the broader economy.
Although Treasury Secretary Henry Paulson and Bernanke had asked Congress to quickly approve their request, it became bogged down on Capitol Hill as lawmakers -- at times prodded by angry constituents -- insisted upon more control over the Treasury's spending authority and provisions to protect taxpayers and struggling homeowners.
Talks on the bailout plan broke down late Thursday, partly because of opposition from House Republicans, who had tried to craft an alternative plan that would let banks buy insurance on mortgage-related debt they hold.
The finalized bailout plan reflects lawmakers' insistence on some control over Treasury's spending. The administration would get $250 billion immediately, followed by another $100 billion if the president certified it was required, according to the AP report. The final $350 billion would require a separate certification and be subject to a congressional resolution of disapproval, the report added. The president could veto this resolution, however.
Negotiations made a breakthrough when Democrats agreed to incorporate a Republican demand to have the government insure some debt instead of buying it, the report said.
The plan would prevent participating companies from giving "golden parachutes" to their executives and aims to limit pay packages, the AP report said. Firms that get $300 million or more of help from the program would have to pay heavy taxes on executive compensation of more than $500,000 a year, the report added.
Taxpayers would also get the opportunity to share in the future profits of companies that participate, because the government would receive stock warrants in return for the help, according to the report.
In an effort to help homeowners facing foreclosure, the plan also would require the government to try to rework bad mortgages it acquires so as to lower borrowers' monthly payments, the report added.
The current crisis, which has its roots in the risky mortgages that were liberally issued earlier this decade and the housing boom that they fueled, has shaken the financial system to its foundations. It has claimed storied investment banks Bear Stearns and Lehman Brothers. This week it forced the government to shut down Washington Mutual(WM Quote - Cramer on WM - Stock Picks) and sell its deposits and assets to JPMorgan Chase (JPM Quote - Cramer on JPM - Stock Picks). Also this week, former investment banks Goldman Sachs (GS Quote - Cramer on GS - Stock Picks) and Morgan Stanley (MS Quote - Cramer on MS - Stock Picks) asked to be made into traditional bank holding companies in order to stave off a market attack on their shares.
The success of the rescue of the U.S. financial system probably depends as much on the central banks of China and the Middle East as on Congress and the Federal Reserve, the Wall Street Journal reports.
The U.S. is turning to foreign governments and other overseas investors to buy a good chunk of the $700 billion in Treasury debt expected to finance the bailout. Foreign investors also are needed to shore up the depleted capital of the nation's financial institutions, the Journal reports.
http://www.thestreet.com/story/10439676/1/house-votes-down-rescue-plan.html
The House of Representatives voted down the $700 billion financial bailout package Monday afternoon, sending stocks into a freefall.
As reports of the vote -- 207 in favor of the measure and 227 against it -- came trickling into Wall Street, the Dow Jones Industrial Average plunged more than 570 points.
House leaders that helped draft the measure were trying to convince the naysayers to change their vote on the measure, which is unpopular among some lawmakers' constituents. Conservative Republicans in the House had been critical of the initial measure, saying it did too much to help Wall Street and not enough to help the average American consumer.
The legislation was intended to allow the government to buy up toxic mortgage-related securities clogging up bank balance sheets. It would represent the biggest government intervention in the nation's financial markets since the Great Depression.
The measure was slated for a Senate vote on Wednesday. It is unclear whether it will need a complete renegotiation and overhaul, or whether House members who supported the bill would be able to convince enough of their counterparts to approve the measure.
While top lawmakers and the Bush administration seemed confident that the proposal had been altered enough to gain approval, apparently not enough were swayed.
"I fully understand that this will be a difficult vote," President George Bush said before the vote Monday morning, according to a transcript of his remarks. "But with the improvements made to this bill, I'm confident that members of both parties will support it. Congress can send a strong signal to markets at home and abroad by passing this bill promptly. Every member of Congress and every American should keep in mind: A vote for this bill is a vote to prevent economic damage to you and your community.
Federal Reserve Chairman Ben Bernanke, in a statement issued Monday morning, praised Congress and the Bush administration for working out an agreement.
"This legislation should help to restore the flow of credit to households and businesses that is essential for economic growth and job creation, while at the same time affording strong and necessary protections for taxpayers," the Fed chairman said.
Bernanke also said the central bank supported "timely actions" taken by the Federal Deposit Insurance Corp. to support "financial and economic stability," a reference to the FDIC's brokering of a deal of Wachovia's (WB Quote - Cramer on WB - Stock Picks) banking operations to Citigroup (C Quote - Cramer on C - Stock Picks).
Congressional leaders put the finishing touches on legislation over the weekend, after several contentious days of negotiations, according to media reports.
The Treasury and the Federal Reserve had been pressing Congress for more than a week to grant Treasury the authority to relieve banks of soured assets. The plan is aimed at stabilizing the credit markets, which have essentially frozen in recent days, and preventing the financial crisis from claiming more banks and further damaging the broader economy.
Although Treasury Secretary Henry Paulson and Bernanke had asked Congress to quickly approve their request, it became bogged down on Capitol Hill as lawmakers -- at times prodded by angry constituents -- insisted upon more control over the Treasury's spending authority and provisions to protect taxpayers and struggling homeowners.
Talks on the bailout plan broke down late Thursday, partly because of opposition from House Republicans, who had tried to craft an alternative plan that would let banks buy insurance on mortgage-related debt they hold.
The finalized bailout plan reflects lawmakers' insistence on some control over Treasury's spending. The administration would get $250 billion immediately, followed by another $100 billion if the president certified it was required, according to the AP report. The final $350 billion would require a separate certification and be subject to a congressional resolution of disapproval, the report added. The president could veto this resolution, however.
Negotiations made a breakthrough when Democrats agreed to incorporate a Republican demand to have the government insure some debt instead of buying it, the report said.
The plan would prevent participating companies from giving "golden parachutes" to their executives and aims to limit pay packages, the AP report said. Firms that get $300 million or more of help from the program would have to pay heavy taxes on executive compensation of more than $500,000 a year, the report added.
Taxpayers would also get the opportunity to share in the future profits of companies that participate, because the government would receive stock warrants in return for the help, according to the report.
In an effort to help homeowners facing foreclosure, the plan also would require the government to try to rework bad mortgages it acquires so as to lower borrowers' monthly payments, the report added.
The current crisis, which has its roots in the risky mortgages that were liberally issued earlier this decade and the housing boom that they fueled, has shaken the financial system to its foundations. It has claimed storied investment banks Bear Stearns and Lehman Brothers. This week it forced the government to shut down Washington Mutual(WM Quote - Cramer on WM - Stock Picks) and sell its deposits and assets to JPMorgan Chase (JPM Quote - Cramer on JPM - Stock Picks). Also this week, former investment banks Goldman Sachs (GS Quote - Cramer on GS - Stock Picks) and Morgan Stanley (MS Quote - Cramer on MS - Stock Picks) asked to be made into traditional bank holding companies in order to stave off a market attack on their shares.
The success of the rescue of the U.S. financial system probably depends as much on the central banks of China and the Middle East as on Congress and the Federal Reserve, the Wall Street Journal reports.
The U.S. is turning to foreign governments and other overseas investors to buy a good chunk of the $700 billion in Treasury debt expected to finance the bailout. Foreign investors also are needed to shore up the depleted capital of the nation's financial institutions, the Journal reports.
http://www.thestreet.com/story/10439676/1/house-votes-down-rescue-plan.html
