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Post by PushyGuyFanClub on Sept 25, 2008 23:55:15 GMT -5
WaMu was a piece of garbage that was going to fail no matter what. I called that in the press a week ago. However, I have no idea what McCain's angle is here. My fear unfortunately is that no one trying to solve the problem really knows what the problem is.
Banks aren't lending each other money because they have no faith in their counterparties. A buyout of toxic mortgages won't solve that; neither will more insurance. Either way, there's no incentive for money to start flowing again, particularly since we're about to enter Q4 when every public company out there -- and particularly banks -- wants to finish its fiscal year with a strong balance sheet (ie., lots of liquid cash and fewer liabilities).
We're in for some pain. I'm not sure what can be done to loosen up the credit markets at this point, but neither government intervention nor non-intervention, IMO, is going to help. I'm at a loss. We're a nation of morons, and we deserve what we get.
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TBird41
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Post by TBird41 on Sept 26, 2008 7:02:54 GMT -5
I don't know how much you can blame McCain for the House Republican Caucus not being on board (and Pelosi has said she wants 80-100 Repubs to vote so she doesn't have to make her entire caucus support it and b/c she's not sure SHE has the votes). He deserves some blame for coming in and trying to take over, but I think the House Republican Leadership is just using McCain as an excuse because they know they don't have the votes no matter what the agreement is.
And I don't know if they're going to get them--every one is getting inundated with phone calls and emails--when thousands of your constituents contact you over the course of a few days, and 95%-99% of them are against something, that really gets a Representatives attention. House offices do not get that kind of input on anything (let alone that kind of uniform input)---not Iraq at its worst, not Katrina, not gas prices, not anything.
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theexorcist
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Post by theexorcist on Sept 26, 2008 7:49:13 GMT -5
If you're a European country who goes into the tank in talks with Iran, you describe the meeting as being "remarkably free of political posturing" when you come up with an agreement that doesn't involve inspections and lets them develop state-of-the-art missiles if they pinkie-swear that it's only going to be for an exhibit in the Tehran Museum of Science.
Democrats have hated this current administration and everything it's done. Now, a proposal by a key administration official - one whom the Democrats had been slamming beforehand - to spend $700B - that's BILLION - is suddenly accepted with minor mods (oh, almost forgot - plus lots of money for the Democrats' pet causes).
The American people, in general, HATE this shady deal and are sick of bailing out companies that, if they made dumb bets and ran their business poorly, would lose their lease on Main Street in a day. And, as has been the case often in the past, they're contacting their House reps, who are usually more connected on day-to-day issues. The Democratic leadership (and Paulson) seems unconcerned and slightly annoyed that the hoi polloi are threatening their deal.
McCain is doing this partially for posturing. He's a) a senator, and b) running for president. EVERYTHING is at least partially done for posturing. But maybe he also realizes it's a bad deal.
And the "we're pulling the rug out from under you" argument is beyond the pale. Every time I read the summaries in USA Today (which almost always culls from wire reports) over the day, various Republicans were very clear in emphasizing that they didn't have a deal.
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Boz
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Post by Boz on Sept 26, 2008 8:10:35 GMT -5
Bennett never said we have a deal. He said we will have a deal. I realize it's semantics, but the two are not the same.
And I can't find another Republican who was in agreement with him. I think its more the case that they were furious with him.
He plays a key role, I grant that, but he does not speak for the leadership, without whom, there is no deal.
As for my previous post, I acknowledge misspeaking there. When I said "with no consultations," I was referring to consulting about what to say to the press. I did not mean to imply that Republicans were not particiapting in negotiations.
But it's Friday, I got back into one day of sniping and it has made me nauseous, so I will retire from this conversation as I always do: assured that I am right and others are wrong. Suck on THAT, world!
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Post by StPetersburgHoya (Inactive) on Sept 26, 2008 8:17:03 GMT -5
Bennett never said we have a deal. He said we will have a deal. I realize it's semantics, but the two are not the same. And I can't find another Republican who was in agreement with him. I think its more the case that they were furious with him. He plays a key role, I grant that, but he does not speak for the leadership, without whom, there is no deal. I realize you've retired from the conversation - but you've got to admit that if he didn't mean that there was a deal, then Bennet was remarkably off message and the GOP leadership should be faulted for letting him speak for them. I think that this may have been the case, but it seems much more likely that there was a deal and then the House GOP (some of them) backed out of it. One of the reasons for that is electoral politics (not McCain's their own). McCain could have told them to stay in-line but didn't. He also didn't endorse the compromise deal and didn't give them political cover. Therefore, the House GOP was forced to come up with their own plan that would be more popular back home. McCain could have prevented this by speaking up about it when he met them or giving them some cover - instead he stayed quiet because of his own electoral concerns. As a result, his time for leadership was a failure.
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theexorcist
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Post by theexorcist on Sept 26, 2008 8:31:29 GMT -5
Bennett never said we have a deal. He said we will have a deal. I realize it's semantics, but the two are not the same. And I can't find another Republican who was in agreement with him. I think its more the case that they were furious with him. He plays a key role, I grant that, but he does not speak for the leadership, without whom, there is no deal. I realize you've retired from the conversation - but you've got to admit that if he didn't mean that there was a deal, then Bennet was remarkably off message and the GOP leadership should be faulted for letting him speak for them. I think that this may have been the case, but it seems much more likely that there was a deal and then the House GOP (some of them) backed out of it. One of the reasons for that is electoral politics (not McCain's their own). McCain could have told them to stay in-line but didn't. He also didn't endorse the compromise deal and didn't give them political cover. Therefore, the House GOP was forced to come up with their own plan that would be more popular back home. McCain could have prevented this by speaking up about it when he met them or giving them some cover - instead he stayed quiet because of his own electoral concerns. As a result, his time for leadership was a failure. It is expected that the GOP is going to get hammered in the House and Senate races. If McCain tells someone to fall in line, they won't necessarily will. Oh, and I'm trying to find the cite, but I swear that I read something somewhere that calls in one office were 90-1 opposed.
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Boz
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Post by Boz on Sept 26, 2008 8:31:32 GMT -5
I realize you've retired from the conversation - but you've got to admit that if he didn't mean that there was a deal, then Bennet was remarkably off message and the GOP leadership should be faulted for letting him speak for them. I think that this may have been the case, but it seems much more likely that there was a deal and then the House GOP (some of them) backed out of it. One of the reasons for that is electoral politics (not McCain's their own). McCain could have told them to stay in-line but didn't. He also didn't endorse the compromise deal and didn't give them political cover. Therefore, the House GOP was forced to come up with their own plan that would be more popular back home. McCain could have prevented this by speaking up about it when he met them or giving them some cover - instead he stayed quiet because of his own electoral concerns. As a result, his time for leadership was a failure. Those first two points I can agree with (particularly with the House Republicans worrying about their own races). As I intimated, I'm not interested in saying the Republicans are beyond reproach here. As for the last point, I think it's too early to say whether McCain has failed here. Today is his day (well not literally, but you know what I mean). He could still come out of this looking much better than he did going in, or it could all backfire on him. All of yesterday means nothing if they get a compromise deal done today. And honestly, right now, I have absolutely no idea whether he will go to Mississippi tonight. Wednesday and even yesderday I thought it was a sure thing that he'd be there, even if he didn't announce it until the last minute. Today, I think there is a real chance he plays that hand through all the way to the river. OK, NOW I've retired from the conversation. (I do have to try to work at some point this morning)
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TBird41
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Post by TBird41 on Sept 26, 2008 8:45:32 GMT -5
I realize you've retired from the conversation - but you've got to admit that if he didn't mean that there was a deal, then Bennet was remarkably off message and the GOP leadership should be faulted for letting him speak for them. I think that this may have been the case, but it seems much more likely that there was a deal and then the House GOP (some of them) backed out of it. One of the reasons for that is electoral politics (not McCain's their own). McCain could have told them to stay in-line but didn't. He also didn't endorse the compromise deal and didn't give them political cover. Therefore, the House GOP was forced to come up with their own plan that would be more popular back home. McCain could have prevented this by speaking up about it when he met them or giving them some cover - instead he stayed quiet because of his own electoral concerns. As a result, his time for leadership was a failure. It is expected that the GOP is going to get hammered in the House and Senate races. If McCain tells someone to fall in line, they won't necessarily will. Oh, and I'm trying to find the cite, but I swear that I read something somewhere that calls in one office were 90-1 opposed. McCain does not have the ability to make House Republicans fall in line, especially the ones representing rural districts that have never been a big fan of him.
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Filo
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Post by Filo on Sept 26, 2008 9:27:29 GMT -5
I can’t stand the partisanship sniping going on, but I guess it is to be expected, especially in an election year. I agree that McCain is coming out of this looking real bad so far, though. Whether legitimate or not, that is how it is coming across.
As far as opposition to the bailout, I don't blame people for being opposed to the bailout in its current form, and I can see why "main street" just looks at it as the government bailing out the Wall Street crowd at the expense of the rest of the nation. But, those who don't want some form of a bailout are just being naive and need to get past the anger. Something needs to be done, and to NOT do something would be beyond absurd.
And people should not be so quick to dismiss some of the potential positives -- it is not unreasonable to expect that the government could make a decent return on a bailout. In addition to Buffett, another pretty smart financial guy, Bill Gross said yesterday that he thinks the bailout could yield a profit of at least 7 to 8% and benefit taxpayers. Of course, he also said the bailout would provide about $40B in equity to the banking system out of a need for about $500B. Yikes.
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TC
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Post by TC on Sept 26, 2008 9:46:16 GMT -5
As far as opposition to the bailout, I don't blame people for being opposed to the bailout in its current form, and I can see why "main street" just looks at it as the government bailing out the Wall Street crowd at the expense of the rest of the nation. But, those who don't want some form of a bailout are just being naive and need to get past the anger. Something needs to be done, and to NOT do something would be beyond absurd. Those that want this bailout haven't thought through what it means or the unintended consequences of it. Say we do the bailout and take all this paper. We devalue the dollar by doing so. There are a HOST of reasons why housing prices are going fall anyway - - rising interest rates at some point will limit the ability of buyers to pay more - aging population is not going to want big houses - increasing energy and food costs limit the ability of buyers to pay more - tougher restrictions on lending narrow the pool of available buyers - thus pushing prices down I'm even starting to like the tin-foil hat idea that the big banks are manipulating things to worsen this crisis so that Congress acts and bails them out.
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Filo
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Post by Filo on Sept 26, 2008 9:59:23 GMT -5
As far as opposition to the bailout, I don't blame people for being opposed to the bailout in its current form, and I can see why "main street" just looks at it as the government bailing out the Wall Street crowd at the expense of the rest of the nation. But, those who don't want some form of a bailout are just being naive and need to get past the anger. Something needs to be done, and to NOT do something would be beyond absurd. Those that want this bailout haven't thought through what it means or the unintended consequences of it. Say we do the bailout and take all this paper. We devalue the dollar by doing so. There are a HOST of reasons why housing prices are going fall anyway - - rising interest rates at some point will limit the ability of buyers to pay more - aging population is not going to want big houses - increasing energy and food costs limit the ability of buyers to pay more - tougher restrictions on lending narrow the pool of available buyers - thus pushing prices down I'm even starting to like the tin-foil hat idea that the big banks are manipulating things to worsen this crisis so that Congress acts and bails them out. On the contrary, I and others are thinking it through. Suffice it to say that we can just agree to disagree. I'll take the risk of the dollar devaluation compared to the alternatives. Credit is the lifeline of our economy. If no one is extending credit, because there is none to be had, our economy will collapse. Then, this won't be just affecting the "Greedy Wall Street crowd."
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TC
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Post by TC on Sept 26, 2008 10:15:30 GMT -5
If you take that position, you're just postponing the inevitable.
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hifigator
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Post by hifigator on Sept 26, 2008 10:28:19 GMT -5
OK, first of all, you're in the tank. That's fine, there's no problem with that, but what you are alleging is not fact. I could just as easily create a new thread entitled "Obama stands on sidelines during crisis, comes running when George Bush calls him, still does nothing." Equally misleading and ridiculous. There was no agreement this morning. Democratic leaders reported that based on some discussions, but with no consultations with senior Republican leadership. But no, THEY couldn't have been playing politics with this, only Republicans do that!! Boehner never agreed to a deal. Shelby never agreed to a deal. The ranking member of the Financial Services Committee, Bachus, never agreed to a deal. Cantor never agreed to a deal. Pick just about any serious player in this and I don't think you can find anyone who did so. There was some agreement on portions of the plan, but just because the media reported what Barney Frank and Chris Dodd wanted them to does not mean that the Republican leadership had agreed on a bill. I have no problem with criticizing McCain, but I have no patience for this ridiculous spin. Thank you Boz. I couldn't believe what I was reading for a while. Once again, since I can't use that "b-b" phrase, these pals from the left are yucking it up making absolutely no sense. "Undermines Bush, Senate Republicans ..." well, aside from whether or not that is factual, the irony here is that the daily mantra from the left has been that McCain is Bush. It has been that he will be four more years of the failed Bush policies. So let's get this straight: if McCain toes the party line or if McCain goes along with others, even in a bipartisan effort, then he is just another Washington insider. But if he rocks the boat in any way; if he dissents in his beliefs in some fashion or another, then he is somehow undermining others' efforts. I'm not talking about the principal details of this particular issue. In other words, I am not praising nor criticizing McCain for his stance on the bailout, just pointing out the incessant nonsense that those of you on the left seem compelled to do on any and every issue. Then you turn around and blame those of us on the right of somehow distorting the facts. Sorry, but that once again doesn't fly. To make matters worse, you continue this recent trend of yucking it up in guffaw-like fashion, patting each other on the back with little more than "what he said" gibberish. As for the real issue, I have major reservations about a widespread bailout. I don't see how it can ever end. Just like most govermental issues, you can justify the action based on extreme circumstances, but then what happens is more and more government involvement which is inherently a bad thing. That being said, I see the danger of doing nothing. I see the collateral damage and the economic turmoil that will doubtlessly follow, regardless of which action we take. Basically, it is a lesser of two evils issue and I'm honestly not sure that I have made up my own mind, much less am I convinced enough to attempt to persuade any of you. What I do know however, is that the "blame/criticize the other side, regardless of any real cause" is totally bogus. In other words, was what McCain did the "right" thing to do in your eyes? The answer is no. But that would have been the same answer if he had done the exact opposite thing. See the problem. I'd still like to point out the "b-b" mentality, but pals will have to suffice for now.
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Post by williambraskyiii on Sept 26, 2008 10:43:06 GMT -5
If you take that position, you're just postponing the inevitable. I am not sure what you are saying here, TC. What is your solution? No bailout and let the chips fall (fail) where they may? Are you positing that no matter what course we ultimately take, the economy is going to collapse? And if so, once the economy "collapses," where do we go from there? Cannibalism?
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hoyatables
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Post by hoyatables on Sept 26, 2008 10:48:35 GMT -5
I'd still like to point out the "b-b" mentality, but pals will have to suffice for now. Go to hell. Reiterating the concept even if you don't use the words is just as offensive. Even more offensive, actually, because it makes it clear that you're not just ignorantly using language.
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EasyEd
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Post by EasyEd on Sept 26, 2008 10:59:59 GMT -5
I hope the phone calls and other messages to the Congressmen continue and increase. This "bailout" is a very bad deal for all. It might ease concern in the stock market for a very short time but it doesn't solve the problem since government can't solve this problem. It will be necessary for companies to fail and the free economy to work its way. Paulson and Bernanke (spelling?) have occupied their seats while this was developing and now they present a "crisis" that must be solved this week!! And Bush goes along with it? And the Dems are now supporting Bush, with slight alterations? And the Repubs who oppose any deal similar to what is proposed are obstructionists? And McCain and Obama, I'm not sure what their positions are. All these people who have been part of creating the problem (Paulson, Bernanke, Bush, Dodd, Frank, etc.) are trying to tell us how to get out of the problem? Gimme a break.
My solution: do nothing except slowly, carefully develop new rules governing lending in this country.
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hifigator
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Post by hifigator on Sept 26, 2008 11:01:40 GMT -5
tables, I am not going to go any further on the issue after this. Maybe it is more of a regional term, I don't know. In any case, it describes almost a clique type of mentality. It is commonly used of frat boys for instance: "Biff and all his B-Bs," for example. I understand that it could simply be used as a derogatory term for those of a certain lifestyle. That isn't the case here. It has a hint of that, but really in a kidding sort of way. No one takes it seriously in that sense. If you understand what I am saying, then I think you will see that it isn't the offensive term, at least in the context which you are familiar. Either way, I am done with that issue and "pals" will now suffice from here on out.
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Post by PushyGuyFanClub on Sept 26, 2008 11:07:17 GMT -5
What the bailout opposition crowd doesn't understand here is that credit now funds more than 90% of our GDP. The credit markets are totally frozen. Unless something is done to lubricate them, even good companies are going to go down since they can't finance inventory. Unemployment will skyrocket since small business cannot invest in growth. Seemingly strong business will have debt called early, which they may or may not be ready for, and they will be unable to get another revolving credit facility. That means liquidations, layoffs, etc., in order to pay the bills. These are extremely tangible consequences for all Americans.
The purchasing of illiquid securities will free up capital. The approval to do so, however, needs to make sure the buyers of these securities (taxpayers) reap any reward of their increase in value. Furthermore, we should get warrants and our preferred shares for our help in recapitalizing these businesses (with terms similar to or better than what Buffett got with GS). It's the only way out. The U.S. government is the only actor with the resources to have any kind of significant effect at this point. I hate that that's true, but it is.
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TC
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Post by TC on Sept 26, 2008 11:18:09 GMT -5
It's not the "only" solution. It's the only solution that's been discussed.
I would have liked to at least discuss the creation of new nationalized banks that would do the credit lending - without the government having to take the mortgage securities onto their books. Or pass the regulation we think we need (new Glass-Steagall AND something attacking derivatives) right now while there is some sense of their danger rather than waiting till later when I'm sure there is going to be opposition to it.
Equity and pricing are the two factors which are the most important in this thing and I just don't think in two days they know enough to get those right.
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Post by sleepyjackson21 on Sept 26, 2008 12:01:56 GMT -5
Couldn't have said it any better Pushy. There is ALOT of debt rolling over before the end of the year. Right now even topflight investment grade companies are having trouble with their financing needs. If companies aren't able to recapitalize, we're screwed. I just hope something is done quickly whether it's the purchase of illiquid securities, injecting equity in these banks and having them write it off and then taking an ownership stake or converting exisitng debt into equity. We just need to act fast because our economy is about to fall off a cliff.
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