Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
Lets really go out on a limb here.
Property values are depressed. The government steps into bail out the mortgage companies that already have a ton of foreclosed real estate on the books.
What if, just what if... this actually MAKES the government money? What if the housing market doesn't stay in the crapper for ever and the foreclosed homes that were aquired for pennies can be sold for nickels?
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
The government is going to buy junk securities - what many accurately describe as "the big sh*tpile", or more politely as "toxic debt" - considered such a poor investment that they're literally dragging the world's largest financial companies into bankruptcy. This will potentially cost $700 billion dollars.
If any private investors thought there was money to be made here they would be lining up to buy the securities for a penny more than the government is willing to pay. And yes, there are investors out there who would buy these securities, but the bailout will pretend that "market value" is enormously above actual market value - the pennies on the dollar that actual investors would presently pay.
So while we can't rule out the possibility that the government could "turn a profit" somewhere down the road, there does not appear to be a single major investor in the entire world who expects that to occur.
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
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aaron
The government is going to buy junk securities - what many accurately describe as "the big sh*tpile", or more politely as "toxic debt" - considered such a poor investment that they're literally dragging the world's largest financial companies into bankruptcy. This will potentially cost $700 billion dollars.
If any private investors thought there was money to be made here they would be lining up to buy the securities for a penny more than the government is willing to pay. And yes, there are investors out there who would buy these securities, but the bailout will pretend that "market value" is enormously above actual market value - the pennies on the dollar that actual investors would presently pay.
So while we can't rule out the possibility that the government could "turn a profit" somewhere down the road, there does not appear to be a single major investor in the entire world who expects that to occur.
Okay, so what is your option?
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
By the way, just to add a little background.
The stock market, for the WEEK, is down 39 points. If that was a recession, it was the shortest one in history.
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
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cyjeff
Okay, so what is your option?
Not trying to sugarcoat a sh*tpile?
There is one theory in which the treasury could pay market value for the toxic debt, thus imposing little risk on the taxpayer. That is one in which the problem is not the value of the debt, but where the bank failures aren't directly related to the toxic debt. In this scenario the problem isn't that there aren't buyers for the debt, but that even if the debt is sold at market value its holders still aren't solvent - and thus still wouldn't be able to borrow money to get out of their liquidity crunch. Even with the bailout, banks in that position could still fail. (In this scenario, we tie up $700 billion in taxpayer money with perhaps little to nothing to show for it.)
Do you see any other scenario where the taxpayers don't take a hit?
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cyjeff
The stock market, for the WEEK, is down 39 points. If that was a recession, it was the shortest one in history.
I suggest you look up the definition of "Recession". You may be shocked to find that the DJIA isn't even mentioned.
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
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cyjeff
By the way, just to add a little background.
The stock market, for the WEEK, is down 39 points. If that was a recession, it was the shortest one in history.
Please, dear G-d, save us from the dim-witted...
Re: When Will the Largest Socialist Country in the World (USA) Return to Capitalism?
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zedex
I do not see where posts such as this are related to legal matters at all. Why not go post on political forums??
BTW, in the midst of such a long rant, I am lost as to the purpose of it. Was there a legal question involved in all that?
I'm new here so I'm not yet overly sure as to when things are considered legal questions or not. So far, I've noticed if you're a senior member, anything you want to talk about is good. If you aren't, then the senior members will berate you for it and use the age-old line of shipping anyone who shares a different opinion off to another country. I suppose that works well - even better if you aren't possessed of a mind sufficiently strong to prove out your assertions.
Anyway, to your question: politics and the law are inextricably linked since 2/3rds of the federal government is overtly political - oddly enough that's the legislature and executive. Curiously enough, these are the guys who make and enforce the laws.
Are you seriously incapable of seeing the connection between political discussions and the law? Or was it because you don't like this guy and just wanted to sound clever?
Aaron, I do like your idea. It reminds me of some southern adages I heard as a child. The first that came to mind is, "you can't polish a turd."
It's a crappy deal all the way around, but I see few solutions which doesn't ultimately involve the tax payer. Either the immediate bailout which will eventually be passed to us. Or a more pronounced devaluation of our economy, which ultimately is in our laps.
Though a mathematician I am, an economist I am not.