Bailout Fails in the House

Wow

by ChelseaFC85 (Orangutan, 259 Points) on 9/29/08 at 10:33pm

The fucking dow just plunged 500 points...this whole mess has been an absolute shitshow. Any takers on the next financial institution to go belly up? I'm thinking National City.

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I wake up from a quick nap,

by ARD45 (Senior Baboon, 198 Points) on 9/29/08 at 2:18pm

I wake up from a quick nap, turn on CNBC, see that the DOW is down over 400 points... shit.

Then about a minute later I hear that the bill fails and watch the DOW drop another 200 points right in front of me.

A shitshow sounds about right.

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I cannot believe this

by Clueless Wanderer (Baboon, 143 Points) on 9/29/08 at 2:28pm

I cannot believe this bullshit...

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So we've had five banks fail

by indian-banker (Senior Gorilla, 809 Points) on 9/29/08 at 2:46pm

So we've had five banks fail so far. One of the two remaining investment banks might fail next.

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in response to indian

by ihavenomoneynow (Baboon, 122 Points) on 9/29/08 at 3:00pm

in response to indian banker.. gs and ms are bank holding companies. raymond jones and jeffries are now #1 and #2. both are pretty stable hurray

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wonder whats next...

by Cornelius (King Kong, 1439 Points) on 9/29/08 at 3:16pm

wonder whats next...

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The public has no clue what

by ARD45 (Senior Baboon, 198 Points) on 9/29/08 at 3:18pm

The public has no clue what is going on and it's killing us.

"Somebody hurt their feelings on now they're going to make the whole country pay"

We need to cut off our nose to save our face.

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Looks like Nat City

by Bowser (Senior Monkey, 93 Points) on 9/29/08 at 3:29pm

Does that mean they'll pull the resume drop at my school?!? Hehe....oh man life sucks right now.

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Lol, do you think they will

by BKBG (Monkey, 44 Points) on 9/29/08 at 3:31pm

Lol, do you think they will stop trading?

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Correct me if I'm wrong but

by jxtxdx (Baboon, 138 Points) on 9/29/08 at 5:00pm

Correct me if I'm wrong but that Michael Moore article sounds like the most ignorant thing I've heard through this entire recent crisis. Does anyone take him seriously?

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Never underestimate the

by Clueless Wanderer (Baboon, 143 Points) on 9/29/08 at 5:18pm

Never underestimate the stupidity of the American people

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Fucking House

by Clueless Wanderer (Baboon, 143 Points) on 9/29/08 at 5:38pm

Fucking House Republicans....

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Dealbreaker with a Rollcall

by aachimp (Gorilla, 696 Points) on 9/29/08 at 7:55pm

Dealbreaker with a Rollcall of votes on Bailout.

http://dealbreaker.com/images/thumbs/bailout.rollcall.0929.pdf

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Disagree

by beta1607 (Senior Chimp, 25 Points) on 9/29/08 at 8:43pm

Except for the people who went broke assuming that Wall Street was smart enough to not over leverage itself.

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Another frustrating thing is

by bkm125 (Orangutan, 269 Points) on 9/29/08 at 10:13pm

Another frustrating thing is that by keeping the $700B bill from passing, Congress sent fear into the markets and the DOW fell by 777 points. Overall investors lost over $1 Trillion dollars today in the markets. So what's better, $700 billion that could actually turn out to make the taxpayers money over time, or a $1 Trillion loss?

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.

by aachimp (Gorilla, 696 Points) on 9/29/08 at 11:24pm

"Dem fuckin Wall Street types want ma munny to save d' economay? Wut da hell? They cud kiss mah ass, 'n join dem L-qaidars in hell"

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republicans

by mlamb93 (Orangutan, 261 Points) on 9/29/08 at 11:40pm

the house republicans really amaze me - they basically just handed the election to obama by failing to deliver on this vote.

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wtf

by shamrok (Chimp, 0 Points) on 9/30/08 at 12:57am

Blame the Republicans? I'm not a fan of either party, but 2/5ths of the Dems voted No on this. If anything, this rejection looks terrible on those that voted for it. It was a terrible piece of legislation. With the way all of Washington has treated the whole thing as a political bullet instead of a real problem, I implore everybody to vote every one of these clowns out of office.

I'm surprised this group, who thrives on the free market, is so for a government run program like this. Let it burn. You wanna be mad at someone, be mad at the Fed for allowing banks to over-leverage themselves while allowing money to be dirt cheap.

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I agree with you Virgina

by aj16 (Chimp, 0 Points) on 9/30/08 at 1:21am

I agree with you Virgina Tech 4ever,

This legislation is toilet paper

The people on this board are frikin retards, who have nothing else to do, but hang around with the American public, whom they apparently call stupid

Use your brains for once and stop ranting!

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let me clarify my position...

by wintonheights (Orangutan, 332 Points) on 9/30/08 at 8:43am

george W.ANKER bush - worst fkg president ever. he used up his political change on the war and now he couldnt round up a fkg silver quarter.

as to the bailout being a disaster, where have you guys been? to suggest not passing this has been a nasty death sentence on WSO for the last week or so. call me a hypocrite, but i was not opposed to this bill passing given the adjustments that had been made. still as ive said before, this whole showdown is akin to the banks holding a remote detonator and telling washington, if you dont help us we keep the financial system hostage and eventually blow ourselves and everyone else up. in this situation, clearly the government needs to do something and i would have settled with the bill as the lesser of evils.

my hypocrisy is, i just dont really think this bill is designed effectively to do what the administration claims. there is nothing in here guaranteeing that after these assets are purchased, banks will not continue to hoard liquidity. clearly we need to do something else in concert. the obvious wall street problem is trust. how do you address issues of trust? transparency. where is the push from the government to redefine and magnify it? also, i think we need to focus in on recapitalization. bernanke claims to be a scholar of the great depression. he should broaden his scope internationally and see that recapitalization by public equity was the leading factor in the more successful banking recoveries across the globe (eg sweeden). i think paulson backed him into a corner with a silver tongued dire scenario and he folded the same way i did that something was better than nothing. now i do believe that there is a significant risk to the financial system, but i think it is grossly over exaggerated. and i think it is disingenuous to claim that this bill largely benefits main street in order to push it through. to all challengers of that view, please add DETAIL to your claims of opposition. the last problem ill mention with this bill is that it doesnt address the root cause of the housing problem which is the continuing increase of foreclosures across the country due to bad loans. if youre willing to sacrifice for the good of the financial system - sacrifice for this root cause. if this is not addressed and these mortgages continue to deteriorate and affect neighboring assets, the cycle continues and well be back for another $700b later on.

ill stop there cause i know what a short attention span we all have.

actually one more thing, slightly off topic - if you think the dow drop was catastrophic, please review your market history and your investment objectives. it is irresponsible of the news to report it as the worst point drop in dow history without also mentioning that it doesnt even make the top 10 in terms of percentage loss. and your 401k, which is the vehicle the majority of middle america uses to invest in the stock market should have a at least 15+ year horizon. in which case there is no need to panic, there is sufficient time for recovery. and if youre well off enough to be playing w/ stocks and got burned you should know the risks. if you couldnt afford it? a fool and his money....

signing off.

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I didn't read all of

by b2 (Gorilla, 530 Points) on 9/30/08 at 9:21am

I didn't read all of wintonheights's post, but, from mlamb's excerpt, it seems as if winston is another 65th, which is the problem with this country [and why the bill didn't get passed]... there are so many 65ths out there who have no idea wtf is going on, so they completely misunderstand how this thing works.

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did you read anything i just said?

by wintonheights (Orangutan, 332 Points) on 9/30/08 at 10:02am

i agreed there is a significant risk to the financial system, did i not? what i said was i believe it is over exaggerated in DIRECT connection with this bill. just because we need to do something does not mean we should do anything. and the reality is, if this bill is passed the next market hesitation will be over when the details will be worked out and into action and then whether or not the bill will even be effective. see, wall street by nature is shortsighted. the government needs to act quick but not in haste. the markets have waited. they can wait for a better solution. nobodys talking inactivity here.

and as i said above, this bill most certainly should not be characterized as "bailout of mainstreet" either. it is clear whos getting the immediate benefit here and thats why it was characterized as it was. long term benefactors maybe be more widely diverse, i agree, but dont kid yourself, this "rescue plan" WILL NOT stop the broader economy from going into a recession and any main street benefit from it is surely residual - save us, so we can loan to credit worthy customers/businesses again and restore profits. yay! wait, what?

so save me the "slow our economy bit". the pain is here to stay. DEAL WITH IT. i have mentioned what i believe are other measures that are better at making this less severe or should at least be included in combination. those are my thoughts. in addition the government should stay out of the way of the free markets and go back to being THE LAST resort. if it intervenes it, should be do what it did w/ bear, wamu and wachovia, be proactive. use its mighty hand to broker deals that consolidate the industry well before it collapses (they have to get better terms and take on less risk tho. geez). it should preside over the orderly dissolution of insolvent companies so there isnt panic. it should reassure the public that its savings and 401ks are safe. and it should force more transparency into the system by investigating all the financial institutions and make their findings public. or temporarily suspend or adjust certain accounting rules for illquid assets. or temporarily suspend all companies from paying dividends. or hell, locking all the heads of banks into a room and not letting them out until they come up with a solution to HELP THEMSELVES. these are things the government has historically been better at doing rather than being an investor in assets it knows nothing about compared to the sellers (ever heard of asymmetric information?).

to be fair though, i actually do agree with you that it is/was irresponsible of the news to report this as a "bailout of wall street", but more irresponsible? im guessing that was just for arguments sake. ill ignore it. "rescue plan" would have been sufficient. but dont kid yourself there would still have been opponents and proponents. now, if youre asking whether or not the american people would have gotten involved enough to intelligently question the bill under than scenario? well thats another story. my guess is it probably would have sneaked through. i mean it almost did yesterday against overwhelming public backlash.

lastly, dont attempt to oversimplify this. IT IS NOT basic economics, otherwise the solution would be in that macro textbook at the back of your shelf you havent read in the last couple of years. and wed be well on our way to recovery.

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winton

by mlamb93 (Orangutan, 261 Points) on 9/30/08 at 10:39am

I really can't think of a more appropriate time where the "last resort" concept applies. Look at the roster of failed institutions: Bear Stearns, Lehman Brothers, Fannie/Freddie, AIG, WaMu, Wachovia, and Merrill (to a certain extent). Nevermind the fact that many of these occurred within days. The market is in a complete state of panic and systemic risk is dangerously high. The LIBOR-OIS spread is at its highest level ever.

I am not one for reckless government spending; however, I firmly believe something needs to be done in the near term to avoid additional stress to the financial markets. Paulson's plan is the best idea we have right now.

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looks like

by mlamb93 (Orangutan, 261 Points) on 9/30/08 at 2:44pm

looks like we agree more than i originally thought. what makes this whole situation so incredibly complex is the fact that there's so many different parties to blame: wall street bankers for selling toxic securities and abusing leverage, mortgage bankers for writing subprime loans, homeowners for piling on debt and living above their means, regulators for failing to adequately monitor the industry, rating agencies for slapping "investment grade" on risky securities, the fed for pumping too much money into the market after 9/11 ... the list goes on and on.

everyone knows something needs to be done - both to avert further damage to the financial system and to mitigate the risk of this happening again in the future (although bubbles will always exist). unfortunately, no one has come up with a solution(s) that addresses all these issues yet.

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