What is Hank Paulson claiming is going to happen?

[hope7134]

What if the whole credit system of money, failed in this country and we had to replace it with real money, because credit wasn't readily available? What if people couldn't go in debt anymore, for what they couldn't afford, and had to live within their means? What if, easy credit came to an absolute end and we had to return to our local banks for credit? What if this unstable credit (financial) system had to go completely away? What if the only reason we are doing a bailout, is because the Fed, doesn't want this easy credit to go away and the American people to finally have a financial system that was based on sound money that couldn't be manipulated by the Fed's credit?

 

[cheapseats]

What if the whole credit system of money, failed in this country and we had to replace it with real money, because credit wasn't readily available? What if people couldn't go in debt anymore, for what they couldn't afford, and had to live within their means? What if, easy credit came to an absolute end and we had to return to our local banks for credit? What if this unstable credit (financial) system had to go completely away? What if the only reason we are doing a bailout, is because the Fed, doesn't want this easy credit to go away and the American people to finally have a financial system that was based on sound money that couldn't be manipulated by the Fed's credit?

Less because we are great, I think, and more because we are insecure and competitive...doesn't matter how old we get, we are still the new kid on the block...we aspire to greatness. Also because we are Addicts, we play for the extremes.

I believe we would rebuild to greatness, differently.

 

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l

WHAT MANNER OF MAN
SEEKS SO MUCH POWER?​

 

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l

THE NEXT GENERATION OF SLICK AND INSINCERE EXECUTIVES
IS PAYING CLOSE ATTENTION TO WHO GETS AWAY WITH WHAT​

 

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l

PROPOSING OVERSIGHT SPEAKS TO THE PROBLEM
GOVERNMENT OVERSIGHT IS A NOTORIOUS SHAM​

 

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GOVERNMENT AND THE FEDERAL RESERVE
PROPOSE TO OVERSEE THEMSELVES AGAIN
Good one.
​

 

[raiha]

keep it up cheapseats...i'm enjoying your font display and your commentsssss

 

[jyakulis]

You can straw man me all day long if you want. All I'm saying is you don't prop up firms with no capital with 'real' capital just so they can loan back capital to make money. Let the bad ones fail and let solvent firms issue credit.

you do understand with no credit there is no money in the system right? the economy will grind to a halt. the stock market will literally drop 1000's of points. people's pensions, 401k's, life insurance would be wiped out.

i'm not saying i agree with the bailout. i don't. but some of you people seem to think it will be rosey if we let this play out. it won't. it will be a complete disaster and the only way to work our way out of it is to let them fail and then reform the system.

i believe we are also reaching a point where all the credit pumped in will limit economic growth to zero. there is in effect a point that is reach in debt where no matter how much more debt is taken on the net gdp growth is 0 or lower. we are approaching that point very rapidly.

 

[vote4ronpauleeze]

As to the original question:

New York Times: Congressional leaders were told "that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally."

http://www.nytimes.com/2008/09/20/washington/19cnd-cong.html?_r=1&hp=&pagewanted=print&oref=slogin

As for a solution: I believe there is none. Is anyone (besides the media) claiming we will get out of this without serious economic repercussions? We were pretty thoroughly screwed even without the current mess that's on the table.

To those who think this will blow over: Do you think jobs are coming back any day now? Do you think people will start spending and saving responsibly soon? Do you think the government will suddenly become able to start paying out the 35+ trillion dollars of debt that they will soon be 'required' to do? [1]

This country is coming apart at the seams and it's disturbing to see people fighting over the scraps. Even as this nation sinks, people scream for their handouts.

"We'll pass this bailout as long as you tack on a few hundred million for these other plans!"

What does the above tell you? Or do you think that's not happening right now?

To me, the bailout is the tip of a very large iceberg of decades of bad policies all coming together at once.

We can sit here and list all of the problems for hours. How about listing what is going right? That's the troubling list.

[1] "C-SPAN-2 - Congressional Budget Office Talks to Accountants
This guy's name is Peter Orszag. He just answered a question from a Representative from Tennessee, asking about the bailout's possible impact on our programs like Social Security, Medicare, etc.
The answer was: Well, I don't mean to beat a dead horse here, but that is a far bigger crisis than what we face right now. We will not be able to sustain Social Security."
http://www.tickerforum.org/cgi-ticker/akcs-www?post=62882

That picture is funny, but the problem is: these aren't two separate, independent entities. If you think the "main street" does not need "wall street" and vice versa, then you are seriously mistaken.

Without credit or financing for businesses, "main street" loses millions of jobs. Main street's livelihood and prosperity is contingent on the success of corporations a.k.a "Wall Street". This isn't a one versus the other situation. If Wall Street crashes, Main Street crashes.

 

[weatherbill]

what we are not being told (IMHO) is what the people with the purse strings in other countries are saying to the Treasury Secretary and others. They invested in the US and will pull out if this bailout doesn't go through. Truth is that they are pulling out anyway... just not as fast.

we don't need wall street... they need us, and consumers control the entire economy. time for us to take it back.

I think you may have hit the nail on the head! The answer lies in what we are not being told.....as is almost always the case with the government.

 

[spudea]

I'm a huge Ron Paul supporter...

A huge Ron Paul supporter should understand MORAL HAZARD. And if this bailout goes through, it does nothing to solve the cause of this disaster. The same mistakes will happen over and over. The US cannot continue to consume 70% of the worlds production using DEBT. Americans have to relearn to save and not sell your soul in order to consume consume consume. Credit is not supposed to be easy to get. The mortgage companies that sold homes to people that couldn't afford them deserve to go out of business.

 

[Deborah K]

Can someone please clearly explain to me what Bush and Hank Paulson think is going to happen?

So far, I've heard the following:

Homeowners with bad mortages may loose their homes. (poor choices)
Personal/Car loans will be much more difficult to get. (yawn)
Edu loans will be more difficult to get. (yawn)
As a result of limited credit, businesses won't be able to operate efficiently. (this sounds bad, but I don't understand the dynamic here) Resulting in loss of jobs.

Can you please elaborate? Surely I'm missing something. While I don't doubt this is serious - I just haven't had a clear picture painted with regards to what happens if government doesn't intervene. They obviously claim to at least know the situation is dire to start throwing out bailout numbers, so it has to be based on some sort of apocolyptic vision. What is it exactly? Have they really spelled it out?

Because of that, when I weight it against the $700 billion bailout, I understand it to lead to an extreme devaluation of the dollar and a slight postponement to the problem we face now, but potentially even worse in the years to come.

What I want to know is what is going to happen if we DO bail out Wall street? They don't seem to want to answer that question.

 

[cheapseats]

What I want to know is what is going to happen if we DO bail out Wall street? They don't seem to want to answer that question.

Higher bank fees are bankable. What're ya gonna do, go elsewhere? This Orchestrated Adjustment is busily eliminating competition.

 

[jbuttell]

That picture is funny, but the problem is: these aren't two separate, independent entities. If you think the "main street" does not need "wall street" and vice versa, then you are seriously mistaken.

Without credit or financing for businesses, "main street" loses millions of jobs. Main street's livelihood and prosperity is contingent on the success of corporations a.k.a "Wall Street". This isn't a one versus the other situation. If Wall Street crashes, Main Street crashes.

True, but never the less it's a good illustration of redistribution of wealth. Theft from one party to another.