BAILOUT: Yes or No?

[TevashSzat]

No, the market will work everything out eventually. Sure, it would be a rough couple of years, but its nothing the "invisible hand" can't handle. Anyways, thats what a free market is anyways....

[Reverend Joe]

No, the market will work everything out eventually. Sure, it would be a rough couple of years, but its nothing the "invisible hand" can't handle. Anyways, thats what a free market is anyways....

The Great Depression was a "rough couple of years" too. That invisible hand spanked our asses red. I don't want to go through anything like that.

But the problem is, like someone else said, inflation, which has already been bothering us recently. We need to do something, but it needs to be nice and steady, not just bum-rushing the economy with a wad of money. I vote no bailout; something else.

Edit: Damnit, Div, I can't vote "no bailout" because the other option says "Let the market work itself out!" Sneaky bastard.

[TevashSzat]

The Great Depression was a "rough couple of years" too. That invisible hand spanked our asses red. I don't want to go through anything like that.

Well, I don't think it ever will happen because politicians won't let something as big as the Great Depression happen nowadays.

But think of it, in a purely economist point of view, there is no thing wrong with great depressions. It is merely the market trying to correct itself and it will teach a TON of lessons. Just look at how much government changed due to the Great Depression.

That is, after all, one of the prices of being in a more or less free market economy. You either go along during both the good and the bad times or have the government intervene and hopefully, things will get better without a much bigger debt

[Jolt]

Well, I don't think it ever will happen because politicians won't let something as big as the Great Depression happen nowadays.

But think of it, in a purely economist point of view, there is no thing wrong with great depressions. It is merely the market trying to correct itself and it will teach a TON of lessons. Just look at how much government changed due to the Great Depression.

That is, after all, one of the prices of being in a more or less free market economy. You either go along during both the good and the bad times or have the government intervene and hopefully, things will get better without a much bigger debt

WON'T? As far as I'm aware, the Great Depression only got "Great" because one of the "measures" the current president at that time did was letting the market work for itself.

[Reverend Joe]

Well, I don't think it ever will happen because politicians won't let something as big as the Great Depression happen nowadays.

But think of it, in a purely economist point of view, there is no thing wrong with great depressions. It is merely the market trying to correct itself and it will teach a TON of lessons. Just look at how much government changed due to the Great Depression.

That is, after all, one of the prices of being in a more or less free market economy. You either go along during both the good and the bad times or have the government intervene and hopefully, things will get better without a much bigger debt

Well, to be fair, any major mistake should logically lead to people learning. The problem is a lot of people get hurt in the process. And besides, who's to say it can't happen again? The economy is really a lot like an 18-wheeler: you can put all the energy in that you want, but you can only control it with the brakes up to a certain point; past a certain speed it's just not going to obey. In our case, it all depends on if we caught this one early enough to stop the crash.

[Sasaki Kojiro]

I haven't decided yet, I'd have to know what the effects of the market collapsing would be. Saying "let it burn and we'll become stronger afterwards" is too vague. Consider that during the stock market crash of 1929 only 2 percent of the population owned stock...

[ICantSpellDawg]

I haven't decided yet, I'd have to know what the effects of the market collapsing would be. Saying "let it burn and we'll become stronger afterwards" is too vague. Consider that during the stock market crash of 1929 only 2 percent of the population owned stock...

Oh no, don't get me wrong, I think leaving the market alone will lead to an immense tragedy. I'm just saying to hell with it. We deserve hellish torment for letting it get this bad.

[Koga No Goshi]

Oh no, don't get me wrong, I think leaving the market alone will lead to an immense tragedy. I'm just saying to hell with it. We deserve hellish torment for letting it get this bad.

What infuriates me, and I can't emphasize this enough, is that the people who most were responsible for this are not going to suffer, no matter which way the bailout decision goes. In either case the pain is left with the taxpayers. I don't think a crash would fix a thing or make any of the people who did this "hurt." We'd need mass mobbings and guillotines to accomplish that.

[Kralizec]

The CEO's ought to be held accountable for such disasters. Stockholders don't care about the longterm health of a company because the vast majority of them is only waiting for a good moment in the near future to sell them. Making this change won't solve the current mess but will prevent future ones if implemented properly.

I just voted no. I think it would be preferable if the government would just buy a ton of houses from involvant families and some of the mortgages (not the crappiest ones at the bottom of the pile, though), or any solution that doesn't involve shareholders.

[Alexanderofmacedon]

It's hard to say for me. I mean I didn't read (I don't know if it's available?...much less would I understand it all?) the plan the senators voted against. It seems bailing them out would not be the best idea, especially because 700 billion is just an estimate, of what it's worth. Whether the taxpayers will receive that much is not really known. Now this might mean the government would own more, which might not be such a horrible thing (but with who is currently in office, perhaps it is...).

Maybe the hindsight bias is making say this, but I would be in favor of a bill that would NOT give any amount of money to the companies, but would put restrictions on loans, mortgages, etc. It's more strict, but this devolution in these categories is obviously not working out.

My 2

[Crazed Rabbit]

Kush:
http://hussmanfunds.com/wmc/wmc080929.htm
He argues buying the bad assets does nothing to lower liabilities. He proposes a streamlined bankruptcy process as well, among other things.

http://faculty.chicagogsb.edu/luigi....n_is_wrong.pdf
An essay from the one thing I like about Chicago, their school of economics, on the need for a streamlined bankruptcy process.

http://www.becker-posner-blog.com/ar...ncial_c_1.html
Lists many problems with the plan.

I am really, insanely happy that the first version (the one that 'Republican holdouts' prevented, I suppose), did not get passed:

Thanks to the House GOP's intervention, the Paulson plan is also better than it would have been. Republicans helped to eliminate the Barney Frank-Chris Dodd slush fund for liberal housing lobbies; a plank to let judges shield deadbeat homeowners from bankruptcy laws; and a ploy to stack bank boards with union members.

http://online.wsj.com/article/SB122264821035984089.html

CR

[Shaka_Khan]

I'd rather endure a global recession so that the US can start all over with a better performance.