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No one is immune to the global crisis, says Ballmer

Wall Street was hammered yesterday, falling just over 777 points in the worst stock market points loss in the nation's history.  The crash came after Congress voted down a bank bailout bill which was expected to return order to the market. 

On hand to analyze the news was the head of one of Wall Street's long time stalwarts, Microsoft CEO Steve Ballmer.  A downcast Ballmer stated gloomily that no one was immune to the global economic meltdown, not even tech giants like Google or Microsoft.  He says he expects consumer and business spending to both languish under the new bleak climate.

At the news conference in Norway this morning, he commented, "Financial issues are going to affect both business spending and consumer spending, and particularly ... spending by the financial services industry.  I think one has to anticipate that no company is immune to these issues."

Mr. Ballmer declined to go into more details about precisely how and how much the tech community is suffering from the downhill ride taken by world markets.  He also declined to give details on whether the crisis was slowing sales of Microsoft's flagship products, such as Windows Vista.

Expectations are currently high for the company, with analysts predicting an 8 percent rise in revenue to just under $15B USD for Microsoft's fiscal Q1, which ends at the close of September.  Mr. Ballmer remained optimistic that the U.S. Congress would move quickly to take action to try to repair the market as soon as possible.

He stated, "I trust that before the end of the week we have some resolution, at least in the U.S. Congress, that will help to stabilize the situation. We need that, I hope we get that.  I have to believe that some of the issues also face the European banks and I trust that the European Central Bank will be as intelligent as it needs to be around that."

In America, shares are expected to rebound slightly today on news that the bailout bill may go through.  European markets, which suffered smaller losses before closing yesterday, hopeful that the bailout bill would pass, will like fair worse today.  Record numbers of foreclosures and high jobless rates have caused banks to be forced to seek a helping hand from the government to keep from going under.

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No to a bailout!
By CSQuake on 9/30/2008 10:00:43 AM , Rating: 3
Personally I don't want to see a 700bn safety net and I want to see the financial sector fail. That way we will get to see the full extent of the greed. We will also get to see new legislation in most countries that prevents the greedy bastards doing it again. 10-15 years of excess ... time to feel the pain!




RE: No to a bailout!
By CSQuake on 9/30/2008 10:03:43 AM , Rating: 2
Ok, I know i'm replying to my own post ... but ... if the 700bn safety net stays goes ahead - fine! - BUT, introduce laws that hold those that created this shitty mess responsible and jail the ****s!


RE: No to a bailout!
By FITCamaro on 9/30/2008 10:29:17 AM , Rating: 1
Those responsible are too high up and well protected by the Democrats to go to prison. Jim Johnson might but that'd be about it. All those who put guys like him in charge and kept him there wouldn't even see a court room.

I for one am extremely pleased. Finally the majority of Republicans and a good number of Democrats rejected socialist ideas and voted to not put the burden of bad decisions on the backs of the tax payer. Of course we'll see what happens later in the week since they're trying to get another vote on it.

What's really disgusting is the number of earmarks on this thing. It's supposed to be some savior for the financial market and politicians are putting their little pet projects and programs on it. Of course course whats another $50-100 million in the face of $700 billion.

Nancy Pelosi should be dragged out and shot. Saying that this is all Bush's fault just before the vote when it has been the actions of Democrats for the past 25-30 years that has caused this mess. Bush pushed for regulations and oversight on Fannie and Freddie that would have called for a reduction of their high interest debt. Democrats shot it down because god forbid people who couldn't afford homes not be able to buy them.

I also want to see the laws that caused this mess repealed and scrapped. Senator Jim DeMint is spot on with what needs to be done.

http://demint.senate.gov/public/index.cfm?FuseActi...


RE: No to a bailout!
By Qi on 9/30/2008 11:20:24 AM , Rating: 3
Bush, October 15, 2002:

One of the programs is designed to help deserving families who have bad credit histories to qualify for homeownership loans.

http://www.whitehouse.gov/news/releases/2002/10/20...


RE: No to a bailout!
RE: No to a bailout!
By Qi on 9/30/2008 11:50:14 AM , Rating: 1
So first creating the problem by giving loans to people with bad credit histories, then acknowledging the self-created problem and trying to fix it. Emphasize on 'trying'.

If anything, you just proved my point.


RE: No to a bailout!
By HeavyB on 9/30/2008 12:05:54 PM , Rating: 1
This new agency appears to have failed miserably. Figures, since it was conceived by the largest executive branch failure in the country's history.


RE: No to a bailout!
By paydirt on 9/30/2008 12:13:53 PM , Rating: 5
OK, and Bush inherited the bursting of the tech bubble, 9/11, and Enron. If you want to blame Bush for that, you got blame problems in your life and need to start taking responsibility in your life.


RE: No to a bailout!
By FITCamaro on 9/30/2008 12:46:00 PM , Rating: 4
These policies were in effect since 1977 with the Community Reinvestment Act. To say Bush created the problem is a down right lie. I'm not saying he didn't add any problem but he obviously tried to go about fix some of it when warned.


RE: No to a bailout!
By Azzr34l on 9/30/2008 12:15:33 PM , Rating: 2
Ha ha, what a great link for the current topic. I love the typical Democrat quote at the end of the article:

"''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''"

So Barney, how's that crow taste?


RE: No to a bailout!
By foolsgambit11 on 9/30/2008 2:20:02 PM , Rating: 4
Oh, come on. The article is from 5 years ago. Fannie and Freddie were on good footing by all accounts then, despite the fact that the Economist was already concerned about the U.S. housing bubble.

Ronald Reagan considered the USSR a formidable enemy and a real threat to the U.S. in the early 80's. Within a decade, it was wiped off the map - EAT CROW REAGAN!!!!

See? It makes no sense.


RE: No to a bailout!
By Ringold on 9/30/2008 2:28:51 PM , Rating: 2
In other words, you admit that The Economist saw it coming, that really many people left out in the wilderness saw the danger in a government-backed entity that could borrow at artificial AAA rates, leverage up, and lend at much higher rates, but then say it makes no sense that people should have a little accountability when they got it wrong?


RE: No to a bailout!
By foolsgambit11 on 9/30/2008 3:11:11 PM , Rating: 3
No. The Economist saw the housing bubble in '03. Its still had 4 years of growing to reach the size that precipitated this crisis.

Unfortunately, at that time, the rest of the economy was weak, which made the Fed keep low interest rates, which made the bubble grow even further. Once all the 'legitimate' buyers of houses were 'used up', lenders started going further and further. Most of the worst practices in lending were from '06-'07.

Also, the Economist wasn't specifically worried about Fannie and Freddie (or even generally, as far as I recall). They were concerned about the general economic effect should the housing bubble burst. They suggested that the Fed adopt policies to cool the market and let it down slowly.

I never in my post suggested people shouldn't be held accountable. But for fun,

Who exactly are you suggesting should be held accountable as far as Fannie and Freddie go? The executives have been replaced, the shareholders are holding stock worth less than 2% of what it was worth a year ago, and oversight has been restored through (quasi-)nationalization.

If history is any judge, the rest of the industry will see legal proceedings for any illegal actions they may have taken. Their share prices have and will fall. Regulators will be re-empowered and will, for a while, do a good job of protecting the greater economy from illegal business practices.

Yes, it's too bad that some people may not feel the full force of their bad decisions, but I personally think it's worth it if it keeps others from feeling the full force of those bad decisions. It's sort of like the principle that it's better to let a guilty person go free than to imprison an innocent person.

Of course, that's predicated on the principle that the action debated by Congress would achieve its goals. I have no idea whether it would or not.


RE: No to a bailout!
By Ringold on 9/30/2008 11:58:47 PM , Rating: 2
quote:
Its still had 4 years of growing to reach the size that precipitated this crisis.


Some economists predict housing values to fall another 10%; hard to say what year had the pricing 'right' at this point. I can see locally in Florida just in the past month a decent contraction in economic activity in certain sectors; that won't help things here.

quote:
Who exactly are you suggesting should be held accountable as far as Fannie and Freddie go?


Any politician blocking GSE reform over the last 20 years or so? I'm quite aware that shareholders have been annihilated, I had a little Fannie preferred stock which now amounts to a lottery ticket. My bet that Paulson wouldn't rip the heads off of the lesser debt holders was wrong, big time, and I paid for it well enough.

All I'm saying is some politicians should've known that any market with a pair of large entities able to borrow perpetually at treasury-bill rates due to implicit backing of the taxpayer would eventually become hyperinflated without care. The GSE's werent handing campaign contributions and charitable donations out like candy with nothing in return. Somewhere, there was corruption.. but of course nothing will ever come of it.


RE: No to a bailout!
By Ringold on 10/1/2008 1:16:24 AM , Rating: 2
quote:
Who exactly are you suggesting should be held accountable as far as Fannie and Freddie go?


How about these asshats?

http://www.youtube.com/watch?v=_MGT_cSi7Rs


RE: No to a bailout!
By jasper2008 on 9/30/2008 11:23:55 AM , Rating: 3
Why does this get rated down?


RE: No to a bailout!
By omnicronx on 9/30/08, Rating: 0
RE: No to a bailout!
By arazok on 9/30/2008 11:29:20 AM , Rating: 5
Because instead of “Worth Reading” and “Not Worth Reading”, people read “I agree”, and “I do not agree”.


RE: No to a bailout!
By omnicronx on 9/30/2008 11:26:23 AM , Rating: 5
Damn Democrats! I can't wait until Palin gets into office so she can snap mccain into action, and so that we can hear some more of this!

"Well, basically Katie, we have too much environment in Alaska and that environment can either rot or be exploited for our benefit, which should mean drilling for oil or other fuel sources, plus harvesting its rich supply of resources such as moose, polar bears, salmon, caribou. God's bounty is there for us to pick and it is sinful not to reap the harvest when God has sown for us. We must fish, drill hunt now."

and this

"Katie, John McCain wants to stop me saying lots of things, but I know one thing for sure, Senator McCain does not know God's will. I know there's a Plan and I hope John McCain is part of that plan in the same way I am."

or maybe this

When asked how Russia's proximity to Alaska's made her a foreign policy expert, Palin seemed confused: "It's funny that a comment like that was -- kind of made to -- cari [caricature? editor's suggestion]-- I don't know, you know, the word, cari... Anyway, reporters, I guess. "

"Mock you?" suggested Couric.

uhhh ahh.. i don't know, you know?

I know this post was pointless, but I just could not get this out of my head, I was laughing on my entire drive to work as I listened to it on the radio.

As for FT's comments, many politicians are corrupt, don't make it out as though Democrats are evil and Republicans do no wrong. These problems can not be pegged squarely on any administration, both Democrats and Republicans did their part in this financial meltdown.


RE: No to a bailout!
By omnicronx on 9/30/2008 11:32:27 AM , Rating: 5
haha just a few more for the road.
quote:
In Alaska we feel the effects of climate change everyday. It's getting warmer for polar bears, so they won't need such thick coats.
quote:
When asked why McCain and Palin were so successful at making inroads among white women with little education, Palin replied: " People without education don't tend to think so much , so it's easier for them to support me.


RE: No to a bailout!
By sgw2n5 on 9/30/2008 11:28:29 AM , Rating: 5
Yes, this is entirely the fault of the democrats. Forget the fact that there has been a republican president for the last 8 years, and a republican controlled congress for most of the past 2 decades. Nevermind the fact that Fannie, Freddie, AIG, and ML are major contributors to the republican party and several of their lobbyists are now McCain advisers...

Yeah, it's the democrats fault... that's the ticket.

Deregulation of banking and financial institutions weren't such great ideas in retrospect eh? Cowboy capitalism just doesn't seem to be working..


RE: No to a bailout!
By codeThug on 9/30/08, Rating: -1
RE: No to a bailout!
By HeavyB on 9/30/08, Rating: -1
RE: No to a bailout!
By codeThug on 9/30/08, Rating: 0
RE: No to a bailout!
By foolsgambit11 on 9/30/2008 2:26:05 PM , Rating: 2
Oh, that's good. Ad hominem attacks. Besides, it's a known fact that homosexuals are better at economics than straight people ;)


RE: No to a bailout!
By FITCamaro on 9/30/2008 12:01:48 PM , Rating: 4
I'm not saying Republicans bear no responsibility. Some of them voted for the crap that kept this going But Bush? No. Granted he's gotten on my sh*t list a few times lately, but I don't blame him for this. These were policies pushed by the Democrats. Many vote for it because if they don't, the Democrats will say "They're against you buying a home!"

quote:
Nevermind the fact that Fannie, Freddie, AIG, and ML are major contributors to the republican party and several of their lobbyists are now McCain advisers...


Are you f*cking kidding me?
Jim Johnson - Obama staff member and Democrat (until he quit because of this)
Barney Frank - Democrat.
Chris Dodd - Democrat

Campaign money received from Fannie and Freddie:
Chris Dodd(D) - $165,400
Barack Obama(D) - $126,300
John Kerry(D) - $111,000
Paul Kanjorski(D) - $96,000
Harry Reid(D) - $77,000
Hillary Clinton(D) - $76,000
Nancy Pelosi(D) - $56,000
John McCain(R) - $21,500

Dodd is the chairman of the Senate banking committee.

Kanjorski chairs the House Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, and Freddie Mac and Fannie Mae are government-sponsored enterprises, or GSEs.

There are republicans on the list too. But overall, the Democrats have received far more money from these two enterprises.

http://www.opensecrets.org/news/2008/09/update-fan...


RE: No to a bailout!
By HeavyB on 9/30/2008 12:10:14 PM , Rating: 1
S'OK, grampy McSame knows Rick Davis will protect him from influence from the evile Fannie and Freddie...ROFL! Oh wait, his chief lobbyist, err, I mean "Campaign Manager" took money from them as recently as a few months ago. There's your maverick for ya.


RE: No to a bailout!
By omnicronx on 9/30/2008 1:01:01 PM , Rating: 4
What exactly was your point here?
Did you even both to add the figures up for both parties? D-2.7 million R- 2.1 million.. whats the point of posting a few individuals when the same can be done for the republicans.

Both parties collected around the same, and both had its big players that received a lot of money. Not to mention this list is from 1989 to now, so a total of 4.7 million dollars between the two in the last 20 years. Compare that to what oil companies paid out and you've got yourself a story.

And just to show that there were as many republicans high on that list here you go..

Bennett, Robert --$107,999
Bachus, Spencer --$103,300
Blunt, Roy --$96,950
Bond, Christopher S 'Kit'---$95,400
Shelby, Richard --$80,000
Davis, Tom --$75,499
Boehner, John --$67,750
Reynolds, Tom --$62,200
Pryce, Deborah --$55,500

p.s although in total Democrats had more contributions, the top twenty for either parties received around the same in total.


RE: No to a bailout!
By monstrosity on 9/30/2008 1:29:23 PM , Rating: 2
quote:
p.s although in total Democrats had more contributions, the top twenty for either parties received around the same in total.


Around the same? I get about a little over $1 million from (D) and a little more than $ 700thousand from the (R).

quote:
Not to mention this list is from 1989 to now


So that would mean Obama should have less than McCain.


RE: No to a bailout!
By arazok on 9/30/2008 11:04:57 PM , Rating: 2
quote:
There are republicans on the list too. But overall, the Democrats have received far more money from these two enterprises.


Why is nobody questioning the wisdom of allowing a government run institution to donate money to politicians? These institutions shouldn't be donating money to anybody.


RE: No to a bailout!
By andyjary on 10/3/2008 5:30:24 PM , Rating: 2
I totally agree.

This is the rot that caused all the problems. Everybody is being bought-off!

It's your own fault as greed begets greed. The only problem I have with this is that the rest of the world is now suffering too... shame on the lot of you :o(


RE: No to a bailout!
By robinthakur on 10/1/2008 12:19:11 PM , Rating: 2
Bottom line for those outside the US. When Bush somehow came to power in 2001, America was universally liked and in a stable rich economic context. 8 years later, you're embroilled in two foreign wars (one of which was based i'm sorry to say on lies), you're trillions of dollars in debt, hated more than at any other time in your history even by friendly nations like the UK and your financial system, and thus the rest of the worlds', is in absolute meltdown. Its somehow hard not to see a correlation here.

While the latter cannot be hung squarely on the republican party's shoulders and was mainly an American problem with lending to people who clearly couldn't afford their mortgages and then securitising bonds out of those risky punts, the first two were definitely the Bush Administrations fault. Just how bad would a democratic president have to be to even be in the same ball-park as Bush?!? You would have hoped that after Bush, the generally great American people wouldn't make the same mistake twice. There's nothing wrong with being able to buy a home *if you can afford it* and the same principle holds for tax rebates...Memo: $9.7trillion national debt and counting. What happens when China calls in all that debt? WW3 is what.

While you would like to take out Nancy Pelosi and shoot her, from what a dispassionate point of view the way as it looks in the UK is that a weak Bush is being utterly disrespected by his own republican party more than the democrats in not getting this passed. The bickering taking place compared to what is at stake if this fails is utterly breath-taking. America should clear up its own mess and when Wall st falls it will take Main st with it, my short-sighted friend as the whole banking, pensions and insurance systems catastrophically fail. Its a good thing that the terrorists you are fighting against are so disorganised as if they attacked now you'd all be shafted, and so would we :0


RE: No to a bailout!
By HeavyB on 9/30/2008 11:43:00 AM , Rating: 2
What a predictable response from FITBruncle. Blame the democrats for everything.


RE: No to a bailout!
By lightfoot on 9/30/2008 11:55:22 AM , Rating: 1
They should take their share of the blame - last time I checked the Democrats were in control of Congress and they are even less popular than W himself.


RE: No to a bailout!
By omnicronx on 9/30/2008 12:43:04 PM , Rating: 3
They both should take their share of the blame! Democrats controlled congress while Bush was in power and the republicans controlled congress while Clinton was in power. All you people are kidding yourselves if you think the blame can be pegged squarely on one side.


RE: No to a bailout!
By HeavyB on 9/30/2008 2:13:33 PM , Rating: 2
Hey Brainiac, the repubs controlled Congress for 6 of 8 of Bush's years. Someone needs remedial School House Rock.


RE: No to a bailout!
By FITCamaro on 9/30/2008 3:00:25 PM , Rating: 2
You seem to assume that because a particular party controls congress they get whatever they want. If that were the case, this bailout would have passed. But it didn't. And 40% of Democrats, which are in charge, voted against it. Having a 1-2 seat majority does not mean that a party can do whatever it wants. You will always have people on both sides that vote on the opposite side of their party.


RE: No to a bailout!
By HeavyB on 9/30/2008 8:29:21 PM , Rating: 1
You obviously know enough about the politics of the last 8 years to know that Congress was nothing but a rubber stamp for Bush the 1st 6 years of his presidency. Let me ask you this, how many vetoes did the shrub use his 1st 6 years as president? That fact alone suggested that the Republican controlled Congress only sent bills to his desk that they knew he would pass (although his LIBERAL use of signing statements is an entire issue in and of itself).

There are so many things at play in the vote that killed the bailout. The Repubs used this opportunity to distance themselves from Bush (and who can blame them). Who knows what the motives of the Dems were, as they are so spineless and disorganized. I have my doubts very few Congressmen on either side placed the interests of their constituents above their own greed. I found Pelosi's statements to be unnecessary and smacking of partisan politics at a time when we need some true leaders to rise above the fray and do what they were elected to do, lead in a time of crisis. Face it they are all crooks to some degree.


RE: No to a bailout!
By frobizzle on 10/1/2008 11:35:16 AM , Rating: 2
quote:
I found Pelosi's statements to be unnecessary

WAHHH! WAHHH! Mommy, Nancy said bad words so now we're not gonna go along with her on the bailout. </sarcasm>

Please, if these poor neocons are so thin skinned they should be seeking other employment!


RE: No to a bailout!
By roastmules on 9/30/2008 11:40:15 AM , Rating: 2
In my often expressed opinion, the key word is "failure". Normally, when a person or business is a failure, we make them prove themselves worthy of a 2nd chance, worthy of additional money.
The problem that I have with the bailout, is that it is a bailout of businesses, which under any normal situation would be allowed to fail.
The bailout is only a bailout of one specific group; it is an expensive mess that doesn't directly help the public, nor is it long-term solution. However, it is a long-term payment.
Our trade deficit is about $600 billion. We import about $700 billion in oil. We spend $600 billion on Iraq. This plan would cost $700 billion.

Instead of bailing out a select few, let's spend the plan's estimated $700 billion on eliminating the trade deficit, and eliminate our need for foreign oil. Invest in the people, invest in the future.
Invest in wind, solar and fission/fusion.
Invest in fast, reliable mass transit. Build several cross-country (n/s, e/w) ultra-high speed train lines. These bring jobs/money and reduce our need for foreign oil.


RE: No to a bailout!
By lightfoot on 9/30/2008 12:25:53 PM , Rating: 2
The problem is that the $700 Billion that would be spent on this "bailout" would likely be paid back in full in less than 5 years. The Return on Investment (ROI) for all your other proposals is far less certain.


RE: No to a bailout!
By 7Enigma on 9/30/2008 12:44:37 PM , Rating: 2
Please, please tell me you are joking with your post right? In 5 years? If the gov gets 1/3 of the money back in 5 years I'll eat my shirt.....if I still have one left on my back..


RE: No to a bailout!
By lightfoot on 9/30/2008 1:25:13 PM , Rating: 2
Read the bill.
Per ABC News:
quote:
The legislation currently on the table states that after five years, the president -- whoever he or she may be -- will be required to submit to Congress a proposal to recover from the financial industry any losses taxpayers may have sustained in the bailout.


IF there are losses in 5 years (that is a big IF not a WHEN) the government will try to recoup those losses from the companies that they bailed out. 5 Years.

http://abcnews.go.com/Business/story?id=5904056&pa...


RE: No to a bailout!
By Ringold on 9/30/2008 1:25:42 PM , Rating: 2
If they got their money back at all, I imagine it'd be within 5 years. Markets should recover by then, and unlike the RTC, the government isn't directly buying homes.. just securities, which, if a real market is established, can be bought and sold with the push of a button. Regardless, it wouldn't end up costing anywhere near 700b.

It could take longer I guess, but we should be well in to the next business cycle in 5 years.


RE: No to a bailout!
By Oregonian2 on 9/30/2008 12:48:05 PM , Rating: 2
How does one get any money to invest if the country is in financial shambles and people unemployed?

btw - what's incredibly ignored in all of this is that it's just not those big companies that have been greedy. AFAIK most all of this trouble is based upon bad mortgages. Those weren't invented by those companies and made out amongst themselves. Greedy people signed up for those mortgages thinking they could get away with getting a house bigger than they could afford or to pay less than they should in the short run thinking themselves lucky (think Vegas) that adjustables or other creative loans won't jump up and bite them -- thinking that record low interest rates would continue for the thirty years it'll take to pay for their homes. Duh. I refi'd a couple times, but ignored those silly super low ARMs and stayed with the fixed rate ones, I may be foolish and greedy, but not that much . IOW it's a concert of greed, not just big companies picking on poor innocent house buyers. Some indeed are innocent (losing their jobs, etc), I'm talking in general in terms of blame throwing and I don't mean to minimize what the companies did with it, just that they're not alone in this. House buying people knowingly got themselves in trouble due to their greed too, and if everybody made good their mortgage commitments these problems wouldn't be happening. Companies made available the instruments for people to commit financial suicide, but people still did it to themselves.


RE: No to a bailout!
By foolsgambit11 on 9/30/2008 2:11:47 PM , Rating: 2
We can't introduce laws that make those people go to jail. If they were breaking a law that existed when they were breaking it, then they should go to jail. But there's this little thing called the Constitution which prohibits ex post facto laws - i.e. making something illegal after the fact.

Imagine you took a deduction on your tax return, then the next year, they made it illegal to deduct that expense, and moreover, anybody who'd taken it as a deduction in past years was sentenced to 6 months in prison, or something like that. No good? No good.

Congress hasn't been doing its duty for over a decade with respect to reigning in the excesses of capitalism through regulation and oversight. If you want accountability, then vote out your congressional representation. Because that's where the fault lies, not with executives who were doing their jobs, i.e. making their company as successful as they could.

This isn't to say that people didn't break existing laws. Those people should go to jail. But the fact that they weren't caught until things have gotten so bad it's blatantly obvious they were doing something wrong is again a wrong whose blame is also shared by Congress and the Executive branch. They have a duty to regulate and to enforce those regulations competently.


RE: No to a bailout!
By andyjary on 10/3/2008 5:36:30 PM , Rating: 2
A Word to The Wise: (Quote from The Inquirer)

IN A FEW HOURS the US House of Representatives might tip that country into a decade long economic depression that will begin the fall of the American Empire and reverberate around the world. While the American Empire's fall won't be lamented, the depression will be painful.

It might do that by voting to grant US Treasury Secretary Henry Paulson the authority to bail out and line the pockets of the wealthiest and most favoured of that reckless class of greed-blinded crooks and swindlers who have financially ruined much of the US populace.

In the process they've driven many large US banks, hedge funds and insurance companies straight off the cliff of financial insolvency and into undeclared bankruptcy.

The so-called representatives of the people might do that because they've been bought and paid-for long ago with incremental bribes of political campaign contributions doled out by that same elite and long entrenched class of financial players. Many US congress people have been paid about $1 million each over the years, give or take a few hundred thousand dollars.

What the House of Representatives is about to vote on and possibly approve is a daft bill already passed by the Senate that would give Secretary Paulson virtually unlimited carte blanche to loot the US Treasury of, and indebt the country for generations by borrowing from the Federal Reserve, and through it the rest of the world, literally trillions of dollars.

The initial authorisation is nominally for $350 billion, but that's automatically extendable to $700 billion under the bill, and that spending authorisation may be renewed, $700 billion at a whack, indefinitely and limitlessly.

Under the bill, Secretary Paulson's authority to pay out taxpayer money to whomever he pleases, for whatever assets or purposes he wishes, at whatever prices, is not constrained in any meaningful way. It is not subject to any binding guidance or close oversight and is not reviewable or reversible by any legislative body or any court of law.

The bill is simply a breathtakingly brazen prescription for total financial dictatorship over the US Treasury and future US tax liabilities, as far as the eye can see.

This incredible financial coup d'etat is being justified as somehow imperatively necessary by the supposedly impending collapse of world's financial system.

The promoters of this scheme -- US Treasury Secretary Henry Paulson, principally, plus US Federal Reserve Chairman Benjamin Bernanke and US President George Bush -- claim that this unprecendented abrogation of US Congressional power over the national purse is needed because some large banks and insurance companies are in a severe financial bind.

The spot they're in has resulted from their wild abandon in devising, making, packaging, insuring, selling and trading home mortgage loans and equity loans, made in all too many cases to people who couldn't afford them.

Many people, who were induced to sign up for variable interest rate Subprime and Alt-A mortgage loans on overvalued houses -- often with no money down, verification of income, assets to back them up, or even paying jobs in many instances -- have been falling behind in their payments and losing their homes to foreclosures in droves for over a year now.

As borrowers, they're trapped by ongoing collapse of the US housing market bubble. The houses that they bought at inflated prices aren't worth nearly as much as they still owe on their mortgages, so they can't sell their homes. And their adjustable rate mortgages are starting to ratchet upwards, making them struggle to make their mortgage payments and forcing many of them into bankruptcy and foreclosure.

The US housing bubble at the root of the current US financial ills was caused by former Federal Reserve Chairman Alan Greenspan's inflationary policy of low interest rates that he pursued for several years, which fueled rampant real estate speculation resulting in an unsustainable rise in US housing prices. In mid-2007, the music stopped and house prices started falling. They still have quite a ways to fall to get back down to the levels ordinary American wage-earners can historically afford, and the US housing market won't begin to recover until they do.

Those institutions are holding stacks of home mortgages and secondary mortgage market bonds and derivatives that are of dubious value. Recent imposition of a rule that they must mark these securities to market prices has made a number of those institutions technically insolvent, because those securities are of unknown value so therefore no banks are willing to buy them at any price, thus they are technically worthless.

Secretary Paulson is proposing to buy up swathes of mortgage bonds, derivatives based upon them, credit default swaps, and whatever else he feels like buying, from whatever financial institutions drag their tattered castoffs into his high-class pawnshop, and he will apparently be willing to pay whatever they ask for them.

Mortgages valued at a trillion dollars or so have already gone bad, that is, either they are non-performing because borrowers have stopped making payments or they've been placed into foreclosure. A Swiss bank estimates that as much as $5 trillion in US mortgages will eventually become worth little or nothing. That's the potential liability facing Mr Paulson.

That amount, $5 trillion, is approximately the value of all US mortgages that are held by Fannie Mae and Freddie Mac, the two US secondary market mortgage holders taken into "conservatorship," that is, nationalised, by the US government just a couple of weeks ago, to put the number in perspective.

The bailout or "rescue" bill proposed, however, won't really place most of the beneficiary financial institutions on firm footing. It will only buy up their worst investments, providing their insiders and major stockholders with large windfalls of cash with which to make fast getaways to sunnier climes. It will merely reward the principal crooks for their larcenies.

That's because the US financial system is awash with arcane derivatives that are called credit default swaps, which Warren Buffet has astutely called " weapons of financial mass destruction." There are presently about $55 trillion in credit default swaps outstanding in the US financial system. There's not enough money in the entire world to buy all those up.

Therefore, some banks, hedge funds and insurance companies are going to fail, dragged down by their former greed in pursuit of ever higher quarterly profits without regard to downside risks. Some large financial institutions will be among those that eventually fail.

The bill won't stave off an economic depression either. In fact, it'll likely both hasten and worsen the depression that's coming, as well as delay the onset of US economic recovery.

That bright light in the American economy's tunnel isn't the sun but rather an onrushing train. Ignoring it will only make the inevitable crash more violent and the damage worse.

But handing the crew that got the US economy into this mess, along with their henchmen and cronies, a free hand to loot the national treasury, enslave taxpayers for generations, and shower the crooked, corrupt and swindling financial elite with cash is simply insane.

It should be interesting to see whether the US Congress actually pulls the trigger on America today.

***********************************************
Nice article, eh? That should clear up a few mis-guided individuals...


RE: No to a bailout!
By arazok on 9/30/08, Rating: 0
RE: No to a bailout!
By CSQuake on 9/30/2008 10:47:09 AM , Rating: 2
Personally I'm safe, but that doesn't stop me standing up for what is right. If the 700bn goes ahead what sort of message does that give to the future finance dealers? Yeah, it's ok, you're safe, the tax payers will fix it when you lose hundreds of billions of dollars while you make yourself tens of millions of dollars in bonuses.


RE: No to a bailout!
By lightfoot on 9/30/2008 11:37:15 AM , Rating: 1
If you think you are safe you are either already dirt poor or you are fantastically naive.

How does the government not spending 700 Billion Dollars while costing the American People 1.1 Trillion Dollars save anyone?

Unless you've got all your money (and your employer has all of their money) stashed in a mattress, then you are relying on the banking and financial system to return your assets. This "bailout" doesn't save stock holders and CEOs - it saves depositors like yourself and all of the nation's employers.


RE: No to a bailout!
By stonemetal on 9/30/2008 11:58:46 AM , Rating: 2
quote:
This "bailout" doesn't save stock holders and CEOs - it saves depositors like yourself and all of the nation's employers.
Nope, FDIC will already give me my money back. This is 100% about kissing big business butt.


RE: No to a bailout!
By FITCamaro on 9/30/2008 12:03:18 PM , Rating: 2
The FDIC is broke.


RE: No to a bailout!
By FITCamaro on 9/30/2008 12:04:22 PM , Rating: 2
Sorry. Meant to say more.

It isn't a matter of whether or not your money is there. It's a matter of will it be worth anything. This bailout would be a huge blow to the value of the dollar. So pray any vote later in the week fails like it did yesterday.


RE: No to a bailout!
By lightfoot on 9/30/2008 12:20:21 PM , Rating: 4
Who do you think the FDIC is? It's the government bailing you out. The 'F' in FDIC is Federal - which means Federal Government.

This plan is about buying distressed assets for less than 60 cents on the dollar because the market has frozen.

The fact that you are still calling this a bailout shows how little you understand the issue. The government is taking a risk - yes - but they are not bailing anyone out. They are acting like a Pawn Shop that will give you a small amount of cash in exchange for your CDOs.

The government is acting like the lender of last resort and allowing companies to use these distressed assets as collateral so that the institutions can continue to function.

The only thing this bill does is allow the government to address all banks in a uniform way instead of the knee-jerk reaction on a case-by-case basis that they have been doing.


RE: No to a bailout!
By ziggo on 9/30/2008 1:01:25 PM , Rating: 2
The government created this problem by getting involved in the market, the answer is not MORE government involvement in the market.

Congress taking up this issue has frozen the markets even further because now the banks are waiting to see if they can get a better deal from the government.

If these assets were priced correctly then they would have been bought already. The government entering the market only distorts the value of these assets.

I am discusted with every single level of government that is supporting this thing.

If the loss of assets is great enough that it is going to restrict the supply of money, then there are much better ways to inject money into the economy in terms of infrastructure, education, and other arenas that the government is already involved in. Hell, build a bunch of nuke plants and then priviatize them.


RE: No to a bailout!
By lightfoot on 9/30/2008 1:33:07 PM , Rating: 2
Typically I would agree, but it could be argued that a lack of government intervention caused this problem, not too much.

However, the house is currently burning, we can either let it burn its self out, or we can try to fight the fire.

Burying your head in the sand won't stop the fire - it has already started.

The bail out plan is an effort to put a price floor in place to support assets that clearly have value, but it is difficult to determine how much. If the government is willing to pay 30 cents on the dollar, the private sector may be willing to pay 60 knowing that half of that is guaranteed by the government. It's like insurance. People aren't willing to commit to buying the asset if they don't think they will be able to sell it in the future.


RE: No to a bailout!
By Ringold on 9/30/2008 1:47:14 PM , Rating: 2
I generally agree. I'm a free-market loving Republican as much as many other people, but I know it wasn't pure free markets that caused this, and I don't see why we should burn the village in order to save it. The Thursday before last, before we knew this bill was coming, it was total death spiral. Good banks, bad banks, good companies and bad, everything was under siege. That may or may not happen again with the same severity.. like any good communist state, we've just gone and banned all short selling (next step: illegal to sell stocks, only buy), but still.

The devaluation of the dollar argument I don't quite see either. We sell bonds by taking money from some people.. and then immediately divert that money right back in to markets, simply a different market. The dollar is still off its lows earlier this year, 700b short term treasuries isn't going to be the stick that breaks the camels back. Our normal budget deficit next year may be larger than 700b anyway.


RE: No to a bailout!
By barclay on 9/30/2008 8:12:34 PM , Rating: 2
I understand your fear of letting the market correct naturally. It is scary -- and it will be painful in the short term. I also feel the same injustice of seeing 'good' banks and companies being hit as hard as the 'bad' banks.

However, this bail out should scare you far worse. It is not some magic pill that will make our problems go away. It will continue to prop up our inflated economy, delaying the necessary adjustment. While at the same time, it will give the green light on tremendous expansion of new government regulatory abilities, which will dramatically reduce the flexibility and innovation of the financial system and will likely produce additional unforeseen consequences.

Please do not join the bandwagon of supposedly free marketers looking for a statist solution.
http://network.nationalpost.com/np/blogs/fpcomment...


RE: No to a bailout!
By Ringold on 10/1/2008 12:12:29 AM , Rating: 2
quote:
It is not some magic pill that will make our problems go away.


Who ever said that it was? Nobody. Definitely not Paulson or Bernanke.

quote:
It will continue to prop up our inflated economy, delaying the necessary adjustment.


How would it even do that? It would move pricing in mortgage backed security markets away from fire-sale prices towards price levels that they probably really are worth, should they be bought and held until they unwound. That said, suspending mark-to-market accounting may well achieve the same goal. The plan would just take the Great Depression II off the table by unfreezing credit markets, not do anything to inflate the rest of the economy.

quote:
While at the same time, it will give the green light on tremendous expansion of new government regulatory abilities, which will dramatically reduce the flexibility and innovation of the financial system and will likely produce additional unforeseen consequences.


Very rarely is anything new in this world. We've done something similar before with the RTC, this won't set any new precedent for government power in the way Roosevelt or Lincoln did.

As for constraining the ability of the financial industry to adjust and retool for future challenges, that's a separate issue entirely. Bailout or no bailout, you know as well as I do that, sadly, next year the Democrats will wage a massive holy Crusade against all of Wall Street. That'll be a separate battle all of its own, and it'll probably we one we will lose.. but still. Not connected to the bailout.

You have a valid point, I think we understand where each other is coming from. I'm just not willing to burn the village in order to save it. We've blown far larger amounts of money on far less worthy things than rescuing the banking system -- money we may well get back.


RE: No to a bailout!
By ziggo on 9/30/2008 2:51:53 PM , Rating: 2
But if me, Mr Joe taxpayer wasnt going to be footing the bill for an insurance policy then they wouldn't be worth 60%. Again, distortion of the market, its an artifical price floor which is going to collapse at some point. These assets were not worth what they were being priced at so now the value has gone down. The answer is not to AGAIN overprice these assets and make the citizens of the country liable for thier unavoidable collapse.

These assets have some value, let the market decide what that value is. Not everyone is going to foreclose, there is money to be made and someone will make it. Thats the beauty of capitalism. I know if I was sitting on the sidelines with some capital I would be salivating right now.

This bailout is not fighting the fire, the damage is already done. This is authorizing the government to buy the burnt house from the owner at an inflated value. Let the carpenter buy the damaged house for a reasonable price and try to fix it to make a buck.

Also, remove regulations regarding these loans. Let buisness's decide who qualifies for a loan and what thier intrest rate should be. I bet they are better at it than a congressman.


RE: No to a bailout!
By arazok on 9/30/2008 11:46:50 AM , Rating: 5
I’m not a big fan of government involvement in the markets myself, but there is a time to prove a point, and a time to do what is necessary.

If you had a system where the government didn’t meddle with the free market, you probably wouldn’t be in this mess to begin with. The fact is that you do have a government that meddles with the free market, and you are in this mess.

For now, you are probably better off to hedge your bets, bail out the market, and hope that it works as intended. You’re going to be out 700bn no matter what you do. You can spend it now and hope to avoid a recession, or not spend it, and loose 700bn in revenue because of the recession. It’s a choice of lesser evils.

After the dust settles, we can all stare at our navels and try to determine why this happened. For now, you’re probably better off to just deal with the situation at hand with the tools available.


RE: No to a bailout!
By FITCamaro on 9/30/08, Rating: 0
RE: No to a bailout!
By Radnor on 9/30/2008 10:54:13 AM , Rating: 3
Aren't we social today !!!

I don't want the bailout also. But I'm European. We tend to nationalize things for a dime went the shit hits the fan.

Honestly, even if i was American, i would say no to the Bailout. First off, making 1.3 trillion dollars (that's the real value, counting with money already spent in "saving") will devalue the dollar. It's just too much money mate.

And you can pay the price short and hard, or forever.


RE: No to a bailout!
By InvertMe on 9/30/2008 11:34:45 AM , Rating: 3
quote:
by arazok on September 30, 2008 at 10:21 AM

I hope you lose your job and get exactly what you asked for.


I am one who lost my job as a result of corporate greed and poor company financial decisions. It took me over 4 months to find a comparable job to the one I lost and I spent most of my savings during that time.

That said - I am glad that the bail out was not pushed through. I think American's need to feel the pinch for a while. Things have been too easy to too long. Starve the dog for a while to make it more aggressive. It will only be a good thing in the long run.


RE: No to a bailout!
By Spuke on 9/30/2008 12:28:47 PM , Rating: 3
quote:
I think American's need to feel the pinch for a while.
Why does everyone act like this is something new? Like we've never been here before? I take you fell asleep during this part of history class too? Or were you still high from the night before?

Market goes up, market must come down. Simple as that. Our buttholes will be tight for a while. Those of you with good credit and stable jobs have fun with all the new low low prices that will be around for a while. Buy a house, a new truck, RV or whatever. It's a good time to buy.

Those of you who are stretched thin with sh!tty credit and live in a house you can't afford, thank you for making things cheap as hell for myself and others.


RE: No to a bailout!
By mikefarinha on 9/30/2008 10:59:17 AM , Rating: 2
To get some good facts you should check out these videos I colleged over the past few days.

It will really open your eyes to what has caused this whole fiasco!

http://mikefarinha.wordpress.com/


RE: No to a bailout!
By jasper2008 on 9/30/2008 11:22:32 AM , Rating: 2
People usually don't want to accept facts.


RE: No to a bailout!
By Spuke on 9/30/2008 12:30:51 PM , Rating: 2
quote:
People usually don't want to accept facts.
Yeah, facts usually get in the way of our ego's.


RE: No to a bailout!
By Ringold on 9/30/2008 1:33:18 PM , Rating: 2
Well, clicked the link, decided to bite on the video, and "We're sorry, this video is no longer available."


RE: No to a bailout!
By mikefarinha on 9/30/2008 3:21:56 PM , Rating: 2
It probably go pulled due to 'copyright infrignement' Look up the youtube user "TheMouthPiece" I'm sure he probably has another copy up and running now.


RE: No to a bailout!
By bighairycamel on 9/30/2008 11:32:59 AM , Rating: 2
Greed? Or the result of a publically traded free market corporation?

When you look at a corporation as an entity, like a living breathing organism, it seems like greed. When you look at it as a mass of humans which include shareholders, chairment, executives, and employees... it's less like greed and more like a bunch of people doing what the free market tells them to: make profit every quarter as best you can.

Don't get me wrong, I'm not standing up for them... but they did what nearly every publically traded corporation in the world does, put profits ahead of common sense.


RE: No to a bailout!
By FITCamaro on 9/30/2008 12:08:21 PM , Rating: 2
Fannie and Freddie are essentially run by the government. They are not the same as Merril Lynch or the other investment banks.


RE: No to a bailout!
By lightfoot on 9/30/2008 12:38:14 PM , Rating: 2
That's simply not true. Both Fannie and Freddie were both private companies that were government sponsored. It was implied that the government would not allow them to fail because they were "sponsored" by Congress. They were treated like government agencies even though they were not. Because of the implied connection to the Government they had to be bailed out to prevent loss of confidence in the US Government.

It is true that they were not the same as Merril Lynch or AIG, but they were not "run by the government."


RE: No to a bailout!
By FITCamaro on 9/30/2008 2:04:08 PM , Rating: 1
http://en.wikipedia.org/wiki/Fannie_Mae#History

http://en.wikipedia.org/wiki/Freddie_Mac#History

Both were created by the government. Both have been lead by people with extremely close ties to the Democratic party. They do as they're told when they're told.


RE: No to a bailout!
By Ringold on 9/30/2008 2:23:50 PM , Rating: 2
They weren't run by the government, though, but they did have their own special regulator that was supposed to keep them in line. Due to their lobbying the regulator was pretty much useless, though, because like you pointed out the politicians weren't about to reform it. They had a CEO, board, etc just like a private company, despite the government backing and the pseudo-regulator. Shareholders nominally owned the company.. until they were nationalized.


RE: No to a bailout!
By Master Kenobi (blog) on 9/30/2008 3:53:16 PM , Rating: 2
I would point out that our market, our loan percentages, and what we were allowed to deal in was 100% controlled by congress.


RE: No to a bailout!
By lightfoot on 10/1/2008 1:01:09 PM , Rating: 2
You must live in a totally different market than I do.

Last time I checked, I can personally loan anyone any amount of money I wish. At any percentage.

The IRS has rules on how I account for it so far as taxes are concerned, and there are regulations on how I loan out OTHER people's money. But the fact that I still have say on how my money is used means that neither the government nor congress controls 100% of the market.


RE: No to a bailout!
By Rhaido on 9/30/2008 1:57:46 PM , Rating: 2
This is not complex. These two articles from 1999 sum it up. The irony is that these are “success stories” that with 10-year hindsight clearly place the blame where it belongs.

http://query.nytimes.com/gst/fullpage.html?res=9C0...

http://articles.latimes.com/1999/may/31/news/mn-42...

Bush played his part too. He was giddy about increasing home ownership for no-credit buyers. No link but I remember one of his State of the Union points about it.

Links from today:
http://www.cnn.com/2008/POLITICS/09/29/miron.bailo...

http://network.nationalpost.com/np/blogs/fpcomment...

As is most often the case, politicians and government interference create the problems we have in the USA. On a tangent, what does the federal government touch that doesn’t turn to scheisse?

For the record, I am a Classical Liberal or Libertarian:
- anti tyrannical federal government
- pro States’ rights
- enumerated powers circa 1787
- let people solve problems at the local and state level
- the people make the country great, not the government


RE: No to a bailout!
By Moishe on 10/1/2008 4:53:47 PM , Rating: 2
I'm actually interested in the same thing.
Let the stuff hit where it hits and see what happens.

Everything that goes up must come down, that includes the stock market. Some things need some adjustment now and then.

Government is not my babysitter and I believe that people in general need to feel a little pain now and then to bring on the life lessons.


correction
By tastyratz on 9/30/2008 9:55:40 AM , Rating: 5
src:
http://tradermike.net/2008/09/the_worst_one-day_pe...

NASDAQ :
# October 19, 1987: -11.35%
# April 14, 2000: -9.67%
# September 29, 2008: -9.14%

S&P:
# October 19, 1987: -20.47%
# September 29, 2008: -8.79%

Dow worst 5:
#October 19, 1987: -22.61%
#October 28, 1929: -12.82%
#October 29, 1929: -11.73%
#November 6, 1929: -9.92%
#December 18, 1899: -8.72%

Dow yesterday:
# September 29, 2008: -7%

It appears that yesterday was in fact, not the second worst day in history for all stocks or even if you isolated the Dow. The Dow suffered the worst 1 day point loss ever, but not percentage. As a percentage we have seen much worse making yesterday not even in the top 5.

Lets not shape statistics to sensationalize Jason, there is enough panic as it is.




RE: correction
By Radnor on 9/30/2008 10:10:04 AM , Rating: 2
Vary nice info.

I agree with you in that point, and that press is using the old motes:

"There are Lies, big lies, and then you have statistics"


RE: correction
By JasonMick (blog) on 9/30/2008 10:13:31 AM , Rating: 3
Sorry, I picked that comment up from CNN.com yesterday. I've changed it to the worst points loss in history, which frankly I think sounds more alarming, but I suppose it paints a more precise picture. Anyways thanks for the note.

At least the market is recovering nicely today. :)


RE: correction
By Spivonious on 9/30/2008 10:28:02 AM , Rating: 2
quote:
At least the market is recovering nicely today.


Proof that government intervention only hurts the market.


RE: correction
By omnicronx on 9/30/2008 11:05:58 AM , Rating: 2
How is that proof? They didn't do anything... All it proves is everyone panicked yesterday.


RE: correction
By Spivonious on 9/30/2008 12:32:55 PM , Rating: 2
Because if the government never said they'd intervene no one would have panicked.


RE: correction
By omnicronx on 9/30/2008 1:13:15 PM , Rating: 2
No.. the market would have crashed regardless, the only reason it went back up from last week is because of the bailout proposal. Yesterdays 10% was a little excessive, but don't expect stocks to rebound to where they were pre-two weeks ago.


RE: correction
By foolsgambit11 on 9/30/2008 2:35:52 PM , Rating: 2
Homer: Not a bear in sight. The Bear Patrol must be working like a charm.
Lisa: That's specious reasoning, Dad.
Homer: Thank you, dear.
Lisa: By your logic I could claim that this rock keeps tigers away.
Homer: Oh, how does it work?
Lisa: It doesn't work.
Homer: Uh-huh.
Lisa: It's just a stupid rock.
Homer: Uh-huh.
Lisa: But I don't see any tigers around, do you?
[Homer thinks of this, then pulls out some money]
Homer: Lisa, I want to buy your rock.
[Lisa refuses at first, then takes the exchange]


RE: correction
By mikefarinha on 9/30/2008 10:56:01 AM , Rating: 2
Thanks for putting the current issue into perspective. Unfortunately many in the liberal media are simply mouth pieces for the Democrats. They want us all to believe that we are going to be hunting for our food by this time next year if we don't fork over our money.

I emailed my Congressman John Dolittle to not support the bailout plan... I'm happy to say he was one of the good ones that voted against it... Oh and look the markets are up today!


RE: correction
By sgw2n5 on 9/30/2008 11:12:00 AM , Rating: 2
It's not just the "liberal" media that is fear mongering... watched any FOX news recently? The neo-con media is just as bad.


RE: correction
By lightfoot on 9/30/2008 11:53:27 AM , Rating: 2
A gain of 300 points after a loss of 778 points is hardly an "up market." A loss of 478 points on the DOW is still huge.

That's like saying the USS Arizona only sunk a little because the harbor was shallow.


RE: correction
By Ringold on 9/30/2008 1:51:52 PM , Rating: 2
And in case anybody actually cares why the market is rallying, CNBC has been asking everybody on the floor today and the answer is essentially unanimous: they feel as if the bailout is a done deal, Congress will keep voting until they "get it right." There's also some talk about the FDIC forcing shotgun marriages between good and bad banks, but thats a bigger government manipulation of the market than just buying undervalued assets in my book. Forced action at the philosophical barrel of a gun is never good.


RE: correction
By foolsgambit11 on 9/30/2008 2:39:12 PM , Rating: 2
Hey, let's be fair here. This is bipartisan fear-mongering. The Congressional Democratic leadership has been largely in agreement with the Bush Administration on this one. And amazingly, instead of everybody jumping for joy about bipartisan cooperation and effective governance, nobody's happy. It just goes to show how polarized things are.


RE: correction
By Ringold on 9/30/2008 2:10:28 PM , Rating: 2
quote:
I picked that comment up from CNN.com yesterday.


That's where you went wrong. ;)

I can not tell you how many times I've got a call from my (Democrat) mother on something finance related she's heard from CNN and I end up having to say "What? Where'd you get that? ... Oh. I've told you before, I'll tell you again, use CNN is good for spin, but for finance news, go to a real financial news website."

Going to CNN for financial news is like going to hotdog stand for a steak. Go to a steakhouse for a steak!


RE: correction
By Azzr34l on 9/30/2008 12:24:52 PM , Rating: 2
With the April 14th exception, all the past big market bombs have come in 3rd Qtrs. Strange.


RE: correction
By jonmcc33 on 9/30/2008 12:33:59 PM , Rating: 2
The Dow was also at 2246 at the time. So the 508 points was a huge drop in percentage.

The 778 point drop yesterday was in fact the worst by number if not by percentage.

http://en.wikipedia.org/wiki/Black_Monday_(1987)


RE: correction
By Spuke on 9/30/2008 12:46:12 PM , Rating: 2
I saw on TV (maybe it was a misprint) that the worst percentage drop in the Dow's history was in 1914.

EDIT: Yep just found it. Dec 14th, 1914. 24.39% drop. Yesterday is number 18.
http://tinyurl.com/4w73nk


Global?
By axias41 on 9/30/2008 10:37:47 AM , Rating: 2
This is not a global financial meltdown, this is THE US financial meltdown




RE: Global?
By InvertMe on 9/30/2008 11:28:14 AM , Rating: 2
US is part of the global market. If the US suffers - everyone suffers (to various degrees). It would be the same if China's economy suddenly tanked. The US and the rest of the world would feel the effects.


RE: Global?
By axias41 on 9/30/2008 11:31:17 AM , Rating: 2
But US rules are not the same in Europe, China, Japan, so consequences


RE: Global?
By Spuke on 9/30/2008 1:08:55 PM , Rating: 2
Dude, did you even look at the other markets before you made that statement? LOL! We're dragging them down too. You do realize that people around the world invest in the world's markets, right?

I'm not going to help you out either. Do some research.


RE: Global?
By axias41 on 10/1/2008 4:00:16 AM , Rating: 2
So you think economy equals to financial markets? This is why Detroit is going to produce...perhaps nothing. US have lost sight of the real economy, losing their dominant position


RE: Global?
By lightfoot on 9/30/2008 12:01:09 PM , Rating: 2
The United States is 40% of the Global Economy.


RE: Global?
By Qi on 9/30/2008 12:46:45 PM , Rating: 2
RE: Global?
By Spuke on 9/30/2008 1:10:14 PM , Rating: 2
Wow! I didn't think it was even that much. Thanks for the info.


RE: Global?
By Qi on 9/30/2008 2:19:55 PM , Rating: 2
Yep, it's the 2nd largest economy in the world, after the European Union.

https://www.cia.gov/library/publications/the-world...


RE: Global?
By Ringold on 9/30/2008 2:55:43 PM , Rating: 2
Europeans still say they haven't yielded sovereignty to Brussels, so the EU is an economic area rather than a sovereign state like the US. For apples to apples, we should add Canadian and Mexican GDP to the US own, possibly even Japan's due to the massive amount of trade we have, thus leading to a comparable number of 16.45t or 20.7t including Japan. Even just adding our physical neighbors, our 16.45t thumps the EU 14.38. Thats a very fair comparison in my book due to NAFTA and a good deal of harmonization.

I know Europeans want to feel important, but they're going to have to work a little harder first. :P


RE: Global?
By Qi on 9/30/2008 3:38:13 PM , Rating: 2
Who is talking about sovereign states? We're talking about economies. The European Union - and even more so the Eurozone - is indeed a single economic bloc. Incomparable to the North American Free Trade Agreement; the European Union is much more than that.

All major economic organisations treat the European Union as a single economy. This is reflected in the International Monetary Fund, the OECD and the World Bank having separate entries and reports for the European Union. As quoted before, the CIA has a separate entry for the European Union as well.

http://www.imf.org/external/pubs/cat/subjdet.asp?s...
http://www.imf.org/external/pubs/cat/subjdet.asp?s...
http://www.oecd.org/country/0,3377,en_33873108_338...
http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTU...
https://www.cia.gov/library/publications/the-world...

The European Union is a World Trade Organisation member too and we have our own G8 representation.

http://www.wto.org/english/thewto_e/countries_e/eu...
http://www.deljpn.ec.europa.eu/union/showpage_en_u...

We're treated as a single economy in the press too:

http://www.reuters.com/article/newsOne/idUSL149197...
http://afp.google.com/article/ALeqM5j2RAttyZxnntuD...


oh well
By NeoConned08 on 9/30/2008 10:11:51 AM , Rating: 3
Too bad nobody listened to Ron Paul.




RE: oh well
By BruceLeet on 9/30/2008 11:20:19 AM , Rating: 2
Ron Paul said NOT to bail out Wall Street, they listened.


RE: oh well
By NeoConned08 on 9/30/2008 11:32:56 AM , Rating: 2
I meant more along the lines of avoiding the things that lead up to the current debacle. Yes, I'm glad that at least some of the Republicrats decided that communism wasn't the best option.


RE: oh well
By FITCamaro on 9/30/2008 12:11:26 PM , Rating: 2
And a good number of Democrats. 40% to be specific. I'm surprised and delighted. Pissed that 32% of supposed Republicans voted for it though. I know many on both sides only voted for it thinking it was the lesser of two evils. Unfortunately for them, they were wrong. The third choice is the best. See my link to Jim DeMint's comments about what should be done.


RE: oh well
By NeoConned08 on 9/30/2008 2:06:18 PM , Rating: 2
Republicans + Democrats = Republicrats

Two different wings of the same bird of prey. Take a guess at who their prey is.


RE: oh well
By foolsgambit11 on 9/30/2008 2:48:31 PM , Rating: 2
Wow. You know the future? You can tell which is the lesser of the several evils facing us?


Pictures?
By 306maxi on 9/30/2008 9:37:54 AM , Rating: 2
Hey! Where's a picture of Balmer looking like a maniac that usually accompanies any story with Ballmer mentioned in it? I want my crazy Steve Ballmer pics!!!!!

On a more serious note Ballmer is right. This is a big problem and the tech sector is certainly not immune. I feel for AMD for instance. There is a real need for them to spend lots of money to catch up to Intel whereas Intel has the luxury of having a good lead and being able to 'coast' for a while on their current wave of success.




RE: Pictures?
By Brandon Hill (blog) on 9/30/2008 9:42:34 AM , Rating: 2
quote:
Hey! Where's a picture of Balmer looking like a maniac that usually accompanies any story with Ballmer mentioned in it? I want my crazy Steve Ballmer pics!!!!!


I originally thought of this picture, but it wasn't really appropriate considering what happened yesterday.

http://i38.tinypic.com/2prckg0.jpg


RE: Pictures?
By PitViper007 on 9/30/2008 9:52:07 AM , Rating: 2
You're right. That picture would not have been appropriate.


RE: Pictures?
By arazok on 9/30/2008 9:54:38 AM , Rating: 2
Somebody has to tell him to put that thing away. It’s scaring my children.


Breaking News
By Ryanman on 9/30/2008 9:37:58 AM , Rating: 2
Congress debating wether or not to bail out tech companies!

To be honest they've already done it for the corrupt banks and ridiculous auto industry. What's left for us to socialize?




RE: Breaking News
By codeThug on 9/30/2008 10:15:56 AM , Rating: 2
The pr0n industry. It seems to be the only thing making money these days.


RE: Breaking News
By Nik00117 on 9/30/2008 11:30:58 AM , Rating: 2
Sex always sells regradless thats why its so great!


Focus on constructive steps
By smilingcrow on 9/30/2008 10:59:14 AM , Rating: 2
I’ve been saying for years that the property and mortgage markets need more regulation but little did I know just how bad things were. My sister’s a banker and instinctively didn’t like the idea but it’s just too important to trust to bankers who’ve proved that they can’t be trusted too many times now.

At this point the focus needs to be on taking constructive steps rather than getting sidetracked with searching for scapegoats and political posturing. One way or another an awful lot of money has been lost and at times likes that vested interests tend to take precedent. It’s time for people to try and see the bigger picture and start thinking about the whole rather than just themselves.




RE: Focus on constructive steps
By FITCamaro on 9/30/2008 12:12:33 PM , Rating: 2
Hope your sister has a job by the end October.


Tarzan agree
By AntiM on 9/30/2008 9:38:09 AM , Rating: 2
Tarzan say economy bad. Cheetah say economy bad.




By crystal clear on 9/30/2008 12:57:14 PM , Rating: 2
quote:
Mr. Ballmer declined to go into more details about precisely how and how much the tech community is suffering from the downhill ride taken by world markets. He also declined to give details on whether the crisis was slowing sales of Microsoft's flagship products, such as Windows Vista


He does say all what you say he declined to say in this interview -I quoted this interview earlier in the link below.

``It would be really imprudent for anybody to not have that in mind,''
By crystal clear on 9/27/08, Rating: 2
By crystal clear on 9/27/2008 5:17:51 AM , Rating: 2

http://www.dailytech.com/Article.aspx?newsid=13065...

Heres an interview of Steve Ballmer worth the read-

Sept. 25 (Bloomberg) -- Microsoft Corp. Chief Executive Officer Steve Ballmer said demand for computer software will probably be hurt by the U.S. financial crisis.

Given the number of programs that U.S. corporations buy,
``it would be reasonable to expect there will be consequences,'' Ballmer, who runs the world's largest software maker, said in an interview before a speech yesterday in Bellevue, Washington.

``Nobody knows exactly what's going to happen.''

Business spending on software and equipment is likely to slow as the U.S. faces ``grave threats'' to financial stability, Federal Reserve Chairman Ben Bernanke said yesterday. The government has responded by proposing a $700 billion bailout fund to alleviate the pressure on financial companies and spur lending. Companies also may respond with caution, Ballmer said.

``It would be really imprudent for anybody to not have that in mind,'' Ballmer said.


http://www.bloomberg.com/apps/news?pid=20601204&si...




A useful article
By webstorm1 on 9/30/2008 1:04:01 PM , Rating: 2
Since I found the republican propaganda above to be a bad source of information (in comments), I started looking for non-partisan information. This is only 1 article, but for those of us interested in the truth, not political posturing, this was a good read. Although I didn't understand 100% of what was said, I did get the gist. It's a piece written in favor of the bailout with an explanation as to why it happened. Not suprisingly, the subprime mortages are a tiny part of the real problem.

http://tcsdaily.com/article.aspx?id=092208A




By crystal clear on 9/30/2008 1:32:51 PM , Rating: 2
quote:
No one is immune to the global crisis, says Ballmer


Read this -

Buffett's "time bomb" goes off on Wall Street

"financial weapons of mass destruction"

http://www.reuters.com/article/newsOne/idUSN183715...

On this day of the Jewish New year Rosh Ha Shana

Wishing all Jewish readers/commentators

A very Happy New Year




whats it all about
By crystal clear on 10/1/2008 2:07:38 AM , Rating: 2
Read below for the full text of the compromise bailout legislation agreed to on Sunday afternoon.

Bailout Bill: Full Text Of Plan

http://www.huffingtonpost.com/2008/09/28/bailout-l...




AT&T and GE
By lightfoot on 10/2/2008 2:45:27 PM , Rating: 2
Why the Economic Rescue Plan MUST pass.

quote:
If major industrial companies find the commercial paper market is frozen, and their access to short-term funding is gone, the dominos start to fall. Payrolls will be missed. Assembly lines will be forced to shut down.


Homer Simpson put it best when he said, “D’oh!”

http://www.theglobeandmail.com/servlet/story/RTGAM...

PS - It's not a bailout.




"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA

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