Posted by
Locutisprime on Sunday, November 09, 2008 11:50:02 AM
I don't know how a lot of people feel about this? But from my perspective, this is a dual edged sword. First, bailing out these big banks represents precisely what? I mean if the end result of not bailing them out means fewer banks and tighter controls on lending practices? I am all for that.
The stupidity of the democrats whose liberalized Fannie and Freddie policies of supposed "affordable housing" is what got us here after all. Affordable to them means two things. Free for the most part number one and find someone else to pay for it number two. Well we now see how well all that worked out. or have we. And now they want to give us affordable health care. And on top of that, we did just elect a democrat to the presidency who has all but assured us that he would wreak further havoc on the American economy in the name of "spreading the wealth around." So can we afford a Detroit bailout? And will any of us even be able to afford to drive what we have in the next 24 months, much less buy something new.
But never the mind on the bank bailout, we went ahead and began plans to bailout a number of the big banks along with Fannie and Freddie as soon as we so the deep doo doo meter reach critical mass in October. And now come the big three auto makers wanting the same deal and speaking of the doom to come, if we as a nation don't ante up once again with more billions for them. So the big three auto makers, who are each individually up to their asses in unionized operating burdens and a consumer market that is for the most part too scared to buy a new car, and those who aren't are incapable of finding financing? Wants an American tax payer financed kick stand to prop them up until the stabilize. But the big questions remain, will they stabilize? Can they stabilize? And how long will that take?
So what do you do when no one will pay $1 a piece for your widgets? You drop the price to $0.50, only to discover that they still don't want to buy your widgets. Now what? Get the government to subsidize your operating expenses for some undisclosed period of time, say six months or a year? And then what happens if the customers are still too skittish to want to temp fate and assume a new car note?
There in lies the dilemma as I see it. The American people are being taxed (literally) to attempt to pay for their own economic survival and in the interim, I don't see the cost benefit analysis as described, being beneficial to anything, other than to keep the plates spinning and the fading illusion of solvency for a little while longer.
Or in essence, unless and until the entire monetary system of this country and the world's economy are collapsed and reconstituted? There is no way for the present economy and world currencies to be sustained, defended or rescued from collapse. Regardless of what we do. I call that the classic Humpty Dumpty scenario of our economy. I just don't see how this train wreck can be fixed, until all the existing track is ripped up and replaced with a solid roadbed.
Reid, Pelosi Urge Treasury to Extend Aid to Automakers
http://www.washingtonpost.com/wp-dyn/content/article/2008/11/08/AR2008110802000_pf.html
By Lori Montgomery
Washington Post Staff Writer
Sunday, November 9, 2008; A01
With the nation's automotive industry hemorrhaging cash, congressional leaders called on the Bush administration yesterday to offer government assistance to the car companies as part of the Treasury Department's $700 billion emergency rescue program.
The call came one day after General Motors, the nation's largest auto manufacturer, announced another multi-billion dollar loss for the third quarter and said it was running out of money fast. Ford, the second-biggest car company, also reported heavy losses. Unless the government steps in, analysts warned, GM could face bankruptcy, endangering the livelihoods of about 100,000 North American autoworkers and hundreds of thousands of others whose jobs depend on the industry.
In a letter to Treasury Secretary Henry M. Paulson Jr., House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry M. Reid (D-Nev.) asked Paulson to "review the feasibility . . . of providing temporary assistance to the automobile industry during the current financial crisis."