53 Responses to “Where Should the Government Draw the Line?”

1. Comment by 6ftrabbit

   November 13th, 2008 at 7:46 am

   I wouldn’t rely on the Obama administration and the Democrats to do anything that doesn’t advance their big Gov’t, Socialist, NannyState agenda. It will be presented in a pretty package, no doubt, but inside it will be a rabid dog, and a brown shirt.

2. Comment by Shawn

   November 13th, 2008 at 8:08 am

   We should have drawn the line the first time ole Hank came to the hill. But that is done. The line needs to be drawn with the Auto makers. Let them sort out the mess that they and the union created by filing chapter 11. that will also send a message to others that the free handouts are going to stop.

3. Comment by Monty T.

   November 13th, 2008 at 8:23 am

   Alexis,

   I think the title “Where should the American People draw the line” would be more appropriate. I agree with your assessment that things are “a mess”. I disagree however with the ideology that we as Americans citizens should carry the full burden to correct this mess. Why should we tighten our belts when our Government is spending and borrowing our hard earned money like there’s no tomorrow. I watched an interview on your station with a congresswoman (sorry, but I didn’t get her name) who was irate that Paulson has changed the plan for using the 700 BILLION DOLLAR bailout without consulting anyone. If I remember correctly Cody Willard pointed out during the vote on this bill that Paulson would have unlimited power to use this money as he saw fit. Cody had a big problem with giving anyone in our Government this much power. Everyone around him rolled their eyes. Seems he was right. The language was in the original and final bill that our Congress and Senate passed and this Congresswoman acted as if she knew nothing about it. She should be irate because she voted to pass the bill and give Paulson the power. We as Americans should be irate as well. I feel we have been duped. I don’t feel that it will be the last time we are duped. I found humor in the fact that you are already making excuses for our future President. I agree that he is inheriting a mess. I believe that he will contribute to the mess. I hope and pray that I’m wrong but it doesn’t feel that way right now. We need our Congress and Senate to come back to work and rescind the bill immediately until some sort of oversight can be established. I find it ironic that our representatives gave one man 700 BILLION DOLLARS and then left town for two months. It’s wrong. As for tightening my belt, I do save what I can through a 401K plan. It is shrinking as I write this. I personally don’t qualify for a bailout plan. I will have to ride the storm out. I live on main street. I have yet to see any of the bailout money being used on my street. With all of the companies lining up for the free money, I doubt that there will be much left for mainstreet. Our Government has created a white collar welfare system for companies who obviously should not be in business in the first place. Alexis, I am angry and disappointed at the way we are being treated. We are not dumb. We do understand what’s going on. It’s time for us to “draw the line”. I pray that it will happen soon.

4. Comment by Don Kamp

   November 13th, 2008 at 8:26 am

   RE: “Where should the gov’t draw the (bailout) line?”

   Lord, where will this road lead? It doesn’t look good… Hmm, no answer…

   I thought that Paulson’s first idea was the best. Now I realize that nearly half of the $700 billion has been spent and not a one of the multitude of distressed loans has been purchased yet. Are we nuts, or what?

   And our US Congress seems to be pointing the finger at any convenient target it can find, yet has no inclination whatsoever to consider that the mandates for Fanny and Freddy to purchase a specific quota of subprime loans is a really bad idea. Correct me if I am wrong, but I think that Fanny and Freddy are still buying subprime and Alt-A loans now and will be into 2009. They just don’t get it.

   You know, often I think back to 9-11-2001 and find myself wondering: Why do the Alcada knock themselves out to hurt us. We are far and away much better that anyone at hurting ourselves. We live in one of the richest, most blessed country on the planet and continue over and over to screw it up. Unbelievable!

   Don, Canajoharie, NY

5. Comment by Dan Walker

   November 13th, 2008 at 8:32 am

   Alexis,

   The problems plaguing America go far beyond bail-outs!

   American society is suffering all types of problems from our families, civil government and Churches. The apathy in Americans today has allowed the very fundamentals of American Life to crumble from a loss of moral integrity, collapsing business’ and civil services, no justice in our judicial systems to a loss of true Faith in God.

   Again, throwing money at the symptoms of our problems does nothing to correct the root causes that will lead to a continuance of problems in the future.

   America needs to first return to God and ask for His forgiveness and blessings to restore America once again. I truely believe that restoring America’s Faith in God will transcend through the remaining problems that plague us today.

   Concerned,
   Daniel K Walker

6. Comment by r rajan

   November 13th, 2008 at 8:52 am

   We Americans have spent far beyond our means for years and now we are all paying the price. It seems that none of the experts can agree on how to reverse the downward slope that we are sliding. People that have saved diligently are being punished unfairly by those who have overspent. I don’t know if the housing crisis is the root of the problem, but it could be used as to help solve this crisis. Instead of concentrating on lending and putting more people in debt, why not offer significant incentives for cash investments in housing. For example, offer a road to citizenship for a family if the can pay cash for a home. (obviously security checks need to be in place), but I would bet that we could eliminate the excess inventory. It would also capitalize the banks and not cost the taxpayer any more money.

7. Comment by Dakota Justice

   November 13th, 2008 at 9:25 am

   At what point will someone say we need to stop these bailouts? I certainly recall the majority of American’s responding with a resounding “NO” to the proposed 700B. But it doesn’t matter what this country wants anymore. The only thing that matters is keeping the rich, rich. Of course, will that even matter when the dollar collapses?

8. Comment by David Fedzina

   November 13th, 2008 at 9:27 am

   Alexis,

   Your third point is about housing being the biggest issue. I agree with you on that 100% - so let’s focus on that for a minute.

   You feel that we should bailout troubled homeoweners. I respectfully disagree. Even if we do bailout troubled homeowners, the price of housing will continue to fall. Why? Because in many markets like mine (northern New Jersey), houses are still extremely unaffordable to any new buyer. Without new buyers in the market, the inventory will stay elevated and that will continue to drag down the price of housing. In my opinion, you’re only prolonging the inevitable. We need to let housing fall to a level of affordability. If that means that people experience foreclosure, than that is what needs to happen. It’s the only way to clean out the “mess” in the financial sector so the slate can be wiped clean.

9. Comment by A Ward

   November 13th, 2008 at 9:36 am

   We do not need another stimulus package. Enough is enough, the american taxpayer will be taxed more and more in order to pay for all of the stimulus packages they are proposing. Let companies claim bankruptcy and reorganize. The big -3 auto makers need to reorganize. The unions is what has caused big time problems for them.

10. Comment by Gary Driscoll

    November 13th, 2008 at 9:37 am

    We should not bail out delinquent homeowners either. Every move makes the disaster worse. The securities will now remain a disaster because no one can guess how the government will intervene and screw up any calculations of their value.

11. Comment by Ken K.

    November 13th, 2008 at 10:03 am

    I used to be inspired by you and your optimism about the markets and the future of the economy. Lately I have been watching and I am getting more and more distraught when watching the latest breaking news about where this market is heading.

    All I am hearing in the coverage of the automakers bailout is nothing but pity for the Detroit automakers. The Detroit automakers have nobody to blame but themselves for the predicament that they are in today. Their lack of foresight and planning for the cars that the consumer wanted has driven their sales down to the point that they have an overwhelming stockpile of vehicles that nobody wants to buy. It is not the credit crunch that is turning customers away from showrooms it is the lack of style, fuel efficiency and high cost. Other reasons the auto manufacturers are in trouble are the outrageous salaries (including bonuses) paid to the upper management of these companies, the union contracts that have been negotiated over the years, the waste of money within the organization at the factory level and last, but not least, the outsourcing of jobs to other countries (Canada and Mexico) over the last 15 years. All three of the Detroit automakers are guilty of spending millions of dollars to build and tool major manufacturing facilities in these countries just to import them back into this country for sale to the consumer. Not only have the Detroit automotive companies spent millions of dollars and moved thousands of jobs out of the country for their plants they have also demanded that companies that supply components to them build manufacturing facilities at the same locations to provide “just in time” manufacturing. The American consumer should be outraged at this especially when Japan and European automakers are dying to build cars here in the United States.

    Instead crying for the Detroit auto manufactures give us some facts and figures on these issues. Find out why these companies are failing and what they are doing to turn things around. Tell the American public why the car companies are really out of money and the American worker is out of a job.

12. Comment by Listening in Texas

    November 13th, 2008 at 10:21 am

    THE RIPPING RIPPLE EFFECT

    What is the driving force or lack of force in today’s uncertain economy woes?

    Are we to believe that since 96% of all people are paying their mortgages on time that this is the REAL reason the overall world economy is suffering?

    FHA loan default rates are and have always been between 2.99% in 2000 to 6.9% in 2004. This is nothing new. The overall average has been around 4% historically for this type of loan. Companies actually brace for this type of percentage in their reserves.

    Conventional yes has typically been around 1% and subprime typically always been around 4% to 6% overall as well. These numbers are really nothing new.

    We hear time and time again that 96% of all homeowners are actually paying their mortgage on time.

    What effect did the actual Subprime market actually carry to cause ALL this turmoil and everyone is BLAMING this specific market for the World’s woes?

    It has to do more with economic cash flow and spending habits of individuals. Over the past 12 years people have become dependent upon the ability to earn money from the availability of funds created by the subprime market.

    Overall there is really nothing new to the overall market forces created by the subprime markets with the exception that is has been literally cut off from new money and the ability to continue the same economic impact and revenue generation.

    What I think is new to this market is that the primed pump of the continual income stream from the subprime market is what has changed. Look at the overall percentage of mortgages the subprime market generated 30% to 35% of the entire market.

    The people in the subprime market were refinancing every couple of years before the interest rate changed or timed it when it did; now that option has been removed.

    Further, many people refinanced regularly to take cash out to support their over abundant lifestyle. Savings in this country has been dismal for the past numerous years and many people were using their homes as the bank to refinance; get cash out, wait a year in an insane market that was showing very high rates of appreciation for real estate markets.

    Investors could purchase properties with NO money down and no cash out of pocket and even they were also refinancing regularly. This option for investors has also been removed and now the investors have pulled back in their overall property acquisitions.

    30 to 35% of the market at least in the bigger metro areas such as Dallas / Ft. Worth was heavily reliant upon the subprime market as well as areas like Phoenix and Las Vegas. I believe the number of major cities actually affected by the major subprime market is 22.

    The ability to refinance those deals with another subprime loan and obtain cash out or pay their taxes or anything else only delayed all this current mess and let it all incur this huge mountain of cash flow problems.

    Foreign investors were the number one buyers of the subprime notes with China being number one (why do you think we give them preferential trade status with all their other antics) and now the property owners have lost their ability to continue the pace at which they had grown accustomed. All the purchasers of the subprime market notes were looking at was the return on their greedy pocketbooks and in their eyes they had a win/win since the appreciation in the property was continuing to climb at unrealistic appreciation rates so in their eyes their investment was “protected” and all they had to do was foreclose and sell the property.

    This cycle lasted for 12 years this time. It normally had been between 5 to 7 years before that and it was not as drastic of a change.

    The REMOVAL of the ability to refinance on the subprime brought to light the ongoing problem that had always been there. I knew of a doctor who refinanced his house each year to pull out cash to help run his office. I have a friend in Phoenix, who has refinanced his house every year and lives off the equity. His house had been raising an average of $50K to 75K per year. I don’t think he has actually really worked in about 4 to 5 years and he still has $75K in his bank account today and getting ready to refi again soon and pull MORE cash out.

    Investors were doing the same thing. Now they have to put down a minimum of 5% into a property and not get cash back at closing as they became accustomed and then refinance to pull even more cash out.

    The entire problem is not the 4% of loans defaulting now; it is a ripple effect and the overall results are cumulative as a result of TURNING OFF THE CREDIT MARKETS. Subprime loans to raising FICO scores from a 100% loan with a score as low as 510 and now raised that to 640 or higher; the ending of the DAP (Downpayment Assistance Programs) and overall getting too tight in the credit markets is the ROOT of all this problem.

    Take into account even small title companies were averaging 185 closings a month between purchases and refinances; then it literally dropped to 23 the next month when interest rates began to rise. This was around August 2005.

    Let’s see the actual dollars in a real estate transaction and breakdown the ripple effect for the overall true economic impact.

    First in the price of a sale of a house you have many people who get paid. I am going to use a lot of breakdown here and combine it also into the refinance aspects as well. We are going to see where all the money goes in an individual sale and its direct effects on the economy overall.

    Let’s evaluate the Sale and Refinancing of a property. The overall difference between a sale and a refinance typically is only the realtor fees. The lending fees are virtually identical and so are the title and escrow fees.

    Let’s say it is about $180,000 as an average price for sale and refinance.

    Realtor fees are negotiable but typically around 6%. $10,800 going to pay for the realtors, brokers, office fees, office staff, phones, copiers and all their expenses. This is usually spit between the listing agent and the selling agent and again with their brokers. The agents do have expenses sometimes contrary to popular belief, it is actually quite expensive to even hold a real estate license whether or not the agent actually sells anything or not.

    Title and Escrow fees $1,500; this paid for the offices, employees, office fees and all their expenses at the title company

    Appraisal fees of $350 average per to pay the appraisal company.

    Lender fees are typically about 3% overall of the loan amount or more for their staffing of Loan officers, processors, underwriters, receptionists, marketing people and running of the company ECT.

    Cash outs were paying off credit cards and other debt so the owner of the property could go out and do it all again.

    Surveyors average of $350 per property to cover all their office fees and staff.

    In other words everyone that was involved in the transaction somewhere was earning money to go spend else where once the companies and their staff was paid. At a small title company, typically had 185 closings per month and brought in income stream of around $250,000 or more per month with a staff between 8 to 10 people. This suddenly in about a 30 day period dropped to around $34,000 a month; with NO recoverability in sight. Staff was begun to be let go, so now those people who were accustomed to earning around $75,000 to $200,000 a year with their bonuses suddenly found their bonus checks that they have become accustomed to suddenly vanish! Now, their $45,000 a year salary is NOT enough to live on by their standards. This is after the title staff went from 10 down to 3 and these are the ones who remained.

    Loan companies have had the same type of attrition. Cutting of processors, underwriters, loan officers and other support staff became the norm. Many Loan Officers overall had become some form of glorified order taker and not what I would consider and actual loan offer who was really versed in the different types of loans and could actually recommend a loan type to the client or customer asking about their services. Many of these people were some of the first to be let loose. Again, there were simply too many loan officers and too few clients available to obtain loans.

    Most of these people are not absorbed back into a company down the street in the same field. Almost all the companies simultaneously let the same amount of staffing go. They had to find their way in other fields and in different career field or simply some other job.

    This same aspect is in each of the above categories. The ones with the best staying power would be the realtors because they were never dependent upon the refi’s for their living anyway. Even this level of people has had its share of attrition. The surplus of houses on the market makes it longer to sell a property and even realtors live pay check to pay check unless they have a “real” job doing something else.

    The overall effect of the cut backs on staffing industry wide from the demise of the subprime market has larger effects than what anyone seems to want to discuss or acknowledge.

    We see it all the time now that a title company simply closes shop as one example. Now, this is also having an effect upon the landlord that was leasing to that office; the phone company that has the phone lines, the power company supplying electric; even the Burger King, McDonalds and other eating establishments that had these companies near them and they would go there for lunch or dinner. Now that the generated revenue is missing, all these places now are obtaining FEWER sales as a result. This will also result in the local Staples not having the office supplies being purchased, the local copier company not having to supply toner, and each one of the companies that is affected by a customer leaving and a loss of capital in the area are also causing the markets to pull back.

    Wal-Mart is doing well; but Neiman Marcus is down and so are the other high end retailers as a direct result of the subprime market and removing 30 to 35% of the total market in refinancing and ability to purchase homes.

    It is not JUST the 30 to 35% of the subprime market; but also the loss of 30 to 35% of the entire market cash flow and related money stream that is the cause of the recession and the downward spiral of the economy.

    Unless they bring the subprime market back as liberal as it was (which is highly doubtful); I would expect all the other markets to pull back by at least the same amounts.

    I personally will not be surprised to see the stock market pull back to around 8,750 to 9,000 as an overall result. The subprime market was a fuel for the rest of the world’s economy and not just here in the US. It fed all the other cash hungry establishments that are also a part of the overall macro economy that is driven by consumer spending. It is a total RIPPLE effect. The subprime was one of the prime players that allowed the rest to function with vitality.

    The total equation is by far more vested than the simple 4% subprime foreclosure rate that they are talking about. It overall has very LITTLE to do with that; but is directly correlated to the lack of ability of those with LESS than perfect credit to continue to refinance and keep the ball bouncing. The tightening of credit will continue to have the strong ripple effect as it is currently doing. We are not talking about a market that had a small impact; this had huge ramifications all over the place.

    A seller now has to rely upon another person with good credit to purchase his or her house to allow them to purchase their NEXT house. No longer can they rely upon the sale of their property through the subprime market to allow them the freedom to go ahead and move to their next property; resulting in longer marketing times and less people being able to purchase.

    With the reduction in buyers able to qualify, the number of homes available for sale has gone up accordingly by not having the subprime market purchasers buying these properties and removing them from the active marketing listings and thus has created a glut in the market resulting is now a mild suppression of housing prices because EVERYONE now is looking for the DEAL and NO ONE wants to pay full retail; again pushing and pressuring home prices to go down not up.

    It is not that there is any super sudden change in the overall number of houses in the market; it is the ability of the buyers to get less of them off the market by withdrawing the subprime market. Instead of having 10 houses on the market and 8 of them sell this month; only 5 of them sell before the next 10 new properties come up for sale. Now instead of having 12 houses in the market, you have 15.

    What does all this mean in the long run? Longer marketing times, less potential buyers and the ones that do come up are only looking for “the good deals”. This will force a temporary slow down in the market until the supply of qualified buyers becomes fairly equal to the number and availability of houses actually offered on the market.

    Laws of supply and demand in classic showing! The more product that is available, the less you will be able to ask for it.

    Look at the New Builds. That market has plummeted to a low not seen in what… 28 years? That should be a HUGE key factor in showing what effect the subprime market was having on the overall economy.

    A wonderful example is that a couple years ago, there was a reasonable drought and hay that the farmers sold was at a premium price of $75 to $80 for one of those large round bails of hay. From this last year, the rain brought an abundance of growing to the state and there is more hay than the farmers know what to do with or even sell. Currently, I have noticed that it is selling for as low as $25 a bail. There is simply too much of it for the market to absorb. The same is going on now with the supply of sellers wanting to sell their properties in relation to the number of buyers able to qualify to purchase the properties. The results will be the same. Sellers will have to continue to decline in their asking prices until the market can find a clearing price for each property.

    Let’s just brace for a reality check here. The days of putting your house on the market and having multiple offers over the asking price within a few days are basically at an end; unless you have done something to the property to make it stand out and highly desired. There are some of those still out there; but fewer and fewer between.

    Overall, there are several factors causing the world wide economic suppression.

    1. The ability for the subprime market to continue and it was suddenly cut off. This deleted 30 to 35% of the overall mortgage generated revenues to numerous industries. This occurred in April of 2007. How many annual transactions occurred each year that had a ripple effect in the local economy? We are not discussing minimum wage jobs but jobs that paid annually around $45,000 to $200,000 a year when you breakdown where all the income was derived and who received it.
    2. New builds are down for the first time in overall remembered history. They needed the subprime market to allow the new buyers to be able to purchase their product. The subprime buyers fueled the purchase of the potential buyers for the new home builders.
    3. The interest rates began to rise and the refinancing boom that lasted for numerous years suddenly stopped. This was around August of 2006.
    4. The overall re-setting of the interest rates in the subprime market for loans between 24 to 36 months are resetting at higher rates. Causing those who were current to become more cash strapped.
    5. The rise in gasoline prices. This will impact every household and reduce their ancillary cash spending on items they don’t really need, so they have less to spend outside their basic survival needs and wants. I still have not seen where the Federal Government is willing to suspend the 18.5 cent per gallon gasoline tax. This is Federal Government revenue OVER $100 Million dollars PER DAY! This does NOT include diesel or any other of the oil related products from a barrel of oil.
    6. The inability of subprime homeowners to refinance into a new loan causing them in some cases to simply walk away and or wait to be foreclosed upon.
    7. If the US Congress does to put a bandage on this by freezing interest rates for any period of time will not fix the problem it will make it worse in the long term. The result of the Great Depression was a direct result of government interference and an attempt to keep wages artificially high; maintain high tariffs that resulted in over 60 countries applying some form of retaliatory tariffs on US products totally resulting in prolonging the Great Depression. Let’s learn our lessons. The market needs to be free from governmental interference and find its own clearing prices. Those are the prices a person is willing to pay on an open market. If there is too much of any one product; it is natural to anticipate that prices will drop until supply and demand level out. Basic economics.
    8. The lowering of interest rates is not necessarily a good thing for the US economy world wide. It weakens the dollar against other currencies. In the short run, it will stimulate our economy but will have negative effects regarding our imports. They will cost more.
    9. It is doubtful that the markets will allow the subprime market to come back; but to get where we were this would be the only real escape from what is about to happen.
    10. Lenders are too quick to simply decide to foreclose and attempt to sell a property; especially in this market. Recently, there was a property we were in escrow on; I represented the buyer, it turned out the seller was $11,000 upside down on the property when we were within 48 hours of closing. The lender REFUSED to accept a short sale and the transaction fell out and now the lender will take a loss well over $25,000 to $30,000. The attorneys in the loss mitigation departments seem hell bent on getting as many properties in the lender’s inventory as possible.

    These are just some of the factors that I believe are at work in the overall markets. There are more and each is contributing to an overall cause; the basic statement is ALL the problems are due to the Subprime market simply are not true. There are numerous factors at play, and yes some of them have to do with the LACK of the subprime market. It did generate its fair share back to the overall economy.

    Though there were many risk factors; which is better, having it with the overall risk or not having it and watch the correction come into play when 30% to 35% of a singular market is removed from the total economy?

    The Ripping Ripple Effect!

13. Comment by Frank in Maryland

    November 13th, 2008 at 10:22 am

    The root of most of the economic problems that America is facing today is that for many years, we’ve been spending more than we’ve earned and consuming more than we’ve produced. Our government and financial institutions have contributed to these problems by adopting policies that have encouraged consumption without responsibility. Pulling the economy out of a recession by pumping low-interest money into the housing market is just one example of this kind of policy. Look where that’s gotten us! Politicians have pandered to their constituents, always offering easy, near-term fixes to financial problems and avoiding hard truths. Need painless revenue? Start a lottery. Never mind that a lottery produces nothing and is ultimately a drain on the economy. The ultimate reckoning for financial irresponsibility has always been pushed off into the future. Well, the future is now, and it’s time to pay the piper.

    American priorities must change. To dig ourselves out of the hole we’re in we need to produce more and spend less. We can no longer afford to allow the government to underwrite inefficient, non-productive, or even frivolous endeavors. Government’s role should not be to bail out failing businesses, but to ensure that the employees of those businesses have productive jobs elsewhere in the economy. Funneling money into failing businesses is not going to create the wealth we need to pay our bills. On the contrary, money pumped into bailouts is just wealth down the drain.

    What’s productive? How about spending some bucks to improve our rail infrastructure? How about a little money on efficient power generation and distribution? Could government dollars bring back American shipbuilding and our merchant marine fleet? How about passing enforceable laws that severely punish employers of illegal immigrants? These hard-working immigrants are sucking wealth out of our economy and enriching the scum that employ them, all at the expense of the American people.

    There are plenty of good, productive things government can do with our money, the only problem is that these things are all going to be unpopular with someone; special interest groups, unions, big-business, environmentalists, etc. Politicians don’t like to do things that are unpopular or that hurt now but are the right thing for the long run. On the other hand, politicians will reflect the attitudes of their constituents. If the American People show a little backbone, the politicians will too. Have Americans grown too fat and lazy to save their own behinds? Time will tell.

14. Comment by s.r.b.

    November 13th, 2008 at 10:24 am

    Propping up bad debt with sound money… what an idiotic plan from the get go! The majority of Americans who were against this bailout plan knew they would throw our 700 Billion to the wind!

    The weaker companies (GM) should fail if they can’t get their act together. Right now we can’t even sort out the good from the bad, as the government keeps propping up the bad companies/financial institutions. This is just going to prolong the pain in this economy. If they keep this up we are looking at ten years or longer of the same, (if we are lucky enough not to slip into a hyperinflationary depression.)

15. Comment by Derrick Dalton

    November 13th, 2008 at 10:29 am

    Alexis, I wanted to clear up something you said yesterday, some one ask you if useing indymac bank as a guide to motifie home mortgages was going to help home owners you said yes. Well let me tell you I’m in that position right now and I think it is a joke, you were right it will bring your payment down by about $300 big deal, mean while they want to up your loan balance by in my case about $30,000 so in a market when my house is worth over 50% less why would any one agree to upping their loan balance? Let me tell you what will work with people going broke out here. The loans to to be motified and the loan amounts droped down to the market rate in the area where they live, when the banks repo these homes it just cost them more money so if the home owner can afford the new loan payments why not do it, its a win for every body

16. Comment by K. S. Ross

    November 13th, 2008 at 10:41 am

    We have written, talked and scolded over this mess. It is true that there has been an over abundance of weak credit in the markets. Blame anyone and everyone. As long as neatly packaged loans were floating about and they could be bought and sold, no questions were asked about the liquidity of the packages. The question of whether or not the holder could back them really didn’t come into play. The American people can’t back them any more than the banks that hold their money can. We have a daisy chain here and King Henry doesn’t have a clue. The chain must be broken in order to repair the loop. Paulson and Bernanke aren’t going to get this figured out until they pull back and look at the big picture. The Fed needs to raise the interest rate to solidify the dollar in order to slow down and break the chain. Only then can they get a handle on who deserves a helping hand. Credit was easy and cheap but it must be backed by something other than funny money. I’m not a fan of high interest rates because it can slow growth however with the apprehension of banks to lend to one another even with buckets of cash to tap from the government it should have a stabilizing effect. Businesses that are run poorly don’t survive and shouldn’t. The automakers are falling prey to a host of parasitic and endemic entities like labor unions that drive ridiculous wages, and benefits, as well as government regulations and mandates that curb production and innovation. It still is a free market, this is nothing more than a blight or disease that will take the weakest out and strengthen the survivors. Throwing cash at the problem with first understanding the problem is doing nothing but treating symptoms without consideration for the disease.

17. Comment by Tony

    November 13th, 2008 at 10:45 am

    Keep it simple….cash only or you can’t afford it

18. Comment by Doug

    November 13th, 2008 at 10:49 am

    The major problem with the economy is the people of America are not only broke but over extended with debt. If you take into account the amount of money people owe on student loans, credit cards, cars, boats, houses and everything else, there is no more money for them to spend. The housing problem will not be fixed by any of these solutions the government is coming up with because people don’t have any money to spend. Without people spending money, more and more people will lose their jobs which will cause more and more people to default on all the different forms of credit mentioned above. The only real solution to this problem is time. It will take time for people to pay down credit so they can once again start buying. Even when this happens I think people will be a bit more cautious with buying on credit. This is going to be a long and painful process.
    On top of all of this we have a government that is extended worse than most Americans are.

19. Comment by Dj Infam0us

    November 13th, 2008 at 10:51 am

    Lett’em burn. All of them. If we don’t let the dinosaurs of industry die how will the economy evolve? We’ve spent so much time fixing old systems the new one’s aren’t being developed.

    When one system fails another one will rise. If we keep patching the old pipes no one is going to bother installing new ones or revamping the system.

    It’s just crazy.

20. Comment by Doug

    November 13th, 2008 at 11:00 am

    The goverment should have never started with the bail out and here is why. The government bailed out all these big companies on wall street and everyone with those companies get to keep their jobs making the same amount of money. Next they will most likely bail out the automotive industry. Sooner or later the line will be drawn and they will say no more bailout. Hmmmm…how about those millions of Americans that are about to lose their jobs because their company had to cut back or didnt get bailed out by the government?

21. Comment by Scott Kirkwood

    November 13th, 2008 at 11:06 am

    A government big enough to give you everything you want is big enough to take everything you have—Thomas Jefferson

22. Comment by Stroker Ace

    November 13th, 2008 at 11:11 am

    What I don’t understand is how people can make it. the cost of living of everyday things keep increasing and we the people aren’t making anymore money. I live on a very tight budget and I can’t even afford to go out and enjoy myself. Do you realize that milk is like $4.50 a gallon? I have noticed that everything in the grocery store has increased between $.50 to $1.50 per item. This forces you to support the larger discount grocery stores like Walmart and hurts the smaller stores. It is not like I have debt other than a car and a home but you can’t even buy everyday things without breaking the bank. The only way that you can make it in this country is to have a duel income in your house. We as a nation force marriage as a way to do this. If that fails you loose at the end. God help you if you have kids and have to pay child support and if you get behind, they will throw you in jail. Then you loose your job and you end up with nothing. The problems go way beyond the bailouts!!

    Hearing about all the bailouts are very depressing the government should make the companies responsible and not the people who pay taxes. If I started a company and it went under, I would take the hit and roll on and pay my dues.

23. Comment by A Capitalist

    November 13th, 2008 at 11:12 am

    Every dollar used for this bailout is a dollar that is taken to fund companies the consumers have voted to defund. They voted to defund these poorly run companies by not shopping there or giving them any loans/bailouts through the private markets.

    Every dollar spent in this bailout will ultimately raise prices for everthing else as it contributes to inflation and keeps high cost companies in business who can’t compete. It also slows the free market down from its attempts to correct this problem of malinvested capital/labor. The market is trying to correct itself. Its only having to do so because of previous gov’t/fed intervention that threw it out of balance. The solution is for the gov’t to do no bailouts. If the gov’t actually wanted to help, it could start by cutting its own spending, balancing the budget, paying back its own out of control debt, then once that’s done, start reducing spending/taxation even further. But that’s not gonna happen because power corrupts….

    The housing situation is only a symptom of the cause behind it. There is a cause to the housing meltdown. It is this:
    Gov’t deficit spending induced the inflation of the money supply, coupled with gov’t forcing banks to ease lending standards, the fed increasing the money supply further with easy credit policies and it led to higher prices in not only housing, but also oil/gas commodities, corn/soybeans/wheat commodities, gold commodities, and on and on. So we find that gov’t deficit spending and Fed money supply expansion led to the housing problem. But make no mistake about it, in the future should similar circumstances of inflationary money arise, it may take the form of price inflation in other areas besides primarily housing. But the result will always be the same, the bust after the artificial boom.

24. Comment by Jay

    November 13th, 2008 at 11:58 am

    Alexis,
    We HAVE to save the automotive industry. People don’t understand- Ford, GM, Chrysler DO NOT make parts any more. They are assemblers only. Their suppliers make parts. So if GM goes down, potentially 4000 suppliers are at risk for going down. And how can anyone say these suppliers weren’t competitive because their customer happened to go under? We just need an environment for these U.S. auto makers to succeed. And this notion that we don’t need ‘em, the Asian OEMs are building plants here- Guess what? They are getting help from THEIR OWN GOVTS, they don’t need ours! It’s like GM going to Japan asking their govt for assistance. It’s apples and oranges. Also, these asian OEMs bring over their own suppliers- they typically don’t use the american suppliers. It is VERY hard for the U.S. supplier base to ‘break in’ to the asian OEMs, even here in the U.S.! The playing field is NOT level.

    It is about JOBS. If we can protect good paying jobs in this country, we don’t have a banking problem. We don’t have a housing problem. We don’t have an overall economic problem.

    No one is talking about this- since 2000, we have lost $2K on avg income! Does anyone realize the significance of this?! In 8 yrs, we are making $2K less! THAT is our problem.

    So, while Wall Street ‘cheered’ all these labor cuts the last 8 years, sure it looked good on the immediate bottom line. But now it’s coming home to roost. These good jobs in manufacturing plants that went away- well, those people are now working at Wal-Mart. Does anyone think that might have something to do with housing crisis, banking crisis, economic crisis?

    Alexis, this stuff is slapping us in the face, but it’s almost like Wall Street & D.C. can’t see the “forest thru the trees.”

    If GM or the other U.S. automakers go down, ‘watch out’. It’s over for any recovery in the next 10 years. It’s Great Depression #2, but I think worse than the 1st time around. There is no other industry that will be able to pick up these workers.

    PLEASE have guests on that understand the auto industry and the implications of it’s failure. Honda, Toyota and Nissan WILL NOT be able to help this country or it’s workers. Plus, they won’t even use the suppliers here in the states that can produce good product for them.

    I keep hearing people say “Let The BIG 3 fail!” They don’t understand, and it really scares me…

    j

25. Comment by Al Nunnally

    November 13th, 2008 at 12:15 pm

    Our government is jumping into the same trap that many of our society have fallen in.
    Spending money they don’t have and having no idea on how to repay it.
    No bailouts of the auto industry or any other industry.
    The U.S. Bankrupcy codes were designed for these situations. Let them use these codes to correct those problems which management and unions are unable or unwilling to address.
    Our Constitution provides us all an opportunity to suceed, it also allows us to fail when we make mistakes.
    All will not be lost if one or more of the automakers fail.
    Their assets will be bought up by a company or companies that will put them to use.
    The independant auto parts companies will see and improvement in their business as will there be a re energizing of the independant repair shops.
    There will be thousands of small business’s spring up all across this nation to fill any void.

26. Comment by Em -

    November 13th, 2008 at 12:29 pm

    Things are definitely a mess. Your 4 points are shared sentiments.

    Although, I’m not sure that the current plans to bailout the housing market will do any good.

    The sub-prime mess created by GSE’s Fannie/Freddie has not been adressed. In fact they are still issuing unregulated securities under the direction of the gov. appointed CEO’s earning $1 million salaries (bonus program is unknown). THE SEC has done nothing to regulate them like other securities at the request of Congress. Yet it seems they expect evil Wall Street to continue selling their securities. Can someone please explain that.

    http://www.treas.gov/press/releases/js2369.htm
    http://www.sec.gov/news/studies/mortgagebacked.htm
    http://www.treasury.gov/press/releases/reports/pspa_factsheet_090708%20hp1128.pdf

    The Government is asking us, the tax payers, to pay for fixing the problem they created. YET - they are apparently immune - no pay cuts, benefit cuts, down-sizing going on in inflation/recession proof DC. They are sure asking alot of the public all the while expecting us to trust them?!? I have watched CSPAN and have no confidence in their knowledge of the problems or their ability to repair.

    I agree with the premise that Washington is pointing the finger at anyone to divert attention from themselves. Yet they continue pushing banks to resume business as usual…….isn’t that how we got into this economic swamp? I saw the CEO of Bank of America on 60 minutes saying he didn’t want to take the money, but was strongly urged???? Can they give it back?

    I don’t know of anyone looking to purchase any big ticket items. And the reports of approx. 40% of the restructured mortgages going into foreclosure despite their new structure sounds like that process may not be the answer. Does anyone know the foreclosure statistics on investment homes being flipped or just the percentage of investment homes in the overall market?

    And why can’t homeowners get better rates to refinance than 6% when prime is so low?

    I’m not convinced that restoring the housing market to where it was will solve the problem. I suspect there were many purchases for investment with plans to trade up as opposed to owning a home and a strong correction is in order and maybe in time, new buyers can buy a home, not an investment.

    Detroit has been in trouble for years, laying off, moving jobs off-shore, offering early retirements, and loosing market share. If they can file some sort of bankruptcy that would protect the retirees and allow them to continue to operate while they try to dig themselves out- that’s what they should do.

    I disagree that this is not Obama’s mess. He is a sitting Senator and president elect. And he said he participated in the discussions about the TARP while on the campaign trail. He has as much ownership in this as the rest. And the deomocratic party has supported the action of the GSE’s for years.

27. Comment by TRUNK MONKEY

    November 13th, 2008 at 12:58 pm

    WHY BAILOUT THE BIG THREE AUTOMAKERS?? SO THEY CAN CONTINUE BUILDING CARS THAT PEOPLE CAN’T AFFORD TO BUY..THIS BAILOUT DON’T MAKE ANY SENCE AT ALL..TYRUNK MONKEY

28. Comment by Ray in PA

    November 13th, 2008 at 1:36 pm

    Alexis, great article…

    Look, we’re deluding ourselves. The root of the crisis isn’t just home mortgages. We overspent on credit (houses, cars, student loans, consumer goods, etc. etc.) and artifically drove up demand for goods & services. In response, we overbuilt capacity (e.g., produced too many cars & new houses).
    Now we have to stop borrowing and start saving. Problem is, that also means significantly downsizing capacity particularly with regards to new cars and new homes.
    I think we can help homebuilders by focusing them on fixing up existing houses in lower income neighborhoods ala Habitat for Humanity. Create more affordable housing rather than new homes that won’t sell.
    Not sure what we can do for the automakers… Can we have them build NG cars for Federal, State & Local governments to replace gas-guzzlers? NG school buses and public transportation. This would help non-profits with the transition to greener technology.

    Let’s make sure that the mission statement is to do the right thing to ultimately help all of society and not just bailout autoworkers or home builders with little long-term benefit.

29. Comment by Walter

    November 13th, 2008 at 1:50 pm

    In an odd way, the fact OBAMA-mania hasn’t caused the markets to turn around is
    a good sign. No one President should be able to effect the global financial markets
    in a huge way, especially one that is not in office. This would be irrational behavior.
    The markets should not run on emotion (yes, a portion of the huge decline haqs been emotionally driven as well)

    The good news is that the struggle continues and govts and financial concerns
    are trying to work thru it. It will take time but we must not rush the process
    and make the mistakes that come along with being hasty.

    Once we emerge from the mess, I am hoping that we’ve learned from these sins and
    do not repeat them.

    As a side note…I find it interesting that oil is now less then $60 per barrel.
    Don’t tell me that speculation didn’t drive up the price to $140.

30. Comment by Christopher Hightower

    November 13th, 2008 at 2:15 pm

    Two problems with the bailout that are seldom mentioned. One: our government is broke and can only inflate to “find” the money. Two: Taking money from one sector of the economy to prop up a failing sector, will only cause the successful sectors to become unsuccessful. These businesses that are coming unglued need to be sold to the highest bidder, or go under! The easiest way to fix most of our countries problems, would be to get the government out of banking!

31. Comment by judy

    November 13th, 2008 at 2:52 pm

    I agree with the comment the automakers are building cars no one can afford to buy; so why should we bail them out? Cars are already ridiculously priced and people are expected to have the money to afford cars that don’t run on gasoline. Drill now!!!

32. Comment by Dennis in Phila.

    November 13th, 2008 at 2:54 pm

    There is no way that the Automobile Manufacturers should be bailed out. They had plenty of time (years) to re-tool and develop more fuel / energy efficient vehicles. They opted to increase their Profit Margins instead, the same as, the Banking and Insurance Companies. If I default on a loan, no one will be there to bail me out! How many Small Businesses are failing with no sign of help?

33. Comment by getreal7

    November 13th, 2008 at 4:08 pm

    Of course we’re bailing out the Big 3. Do you really think Obama and the dems can say no to the unions? Question is, can they last until he’s in office? Will be fun to watch.

    I don’t think we should bailout anyone. The government would have been better off sending that 700 billion directly to the taxpayers via stimulus checks. Most would have spent it right away. Same government debt, quicker effect.

34. Comment by David

    November 13th, 2008 at 8:19 pm

    Alexis,

    There is but one simple yet very painful answer. Get the government out of this and let market forces work. Let industries go bankrupt. Let lessons be learned. At one time I thought the market would reward those of us who are rational and responsible. Apparently that was naive of me. There is this vicious cycle of unintended consequences anytime the government gets involved. This economy needs those of us who have been responsible to eventually come to the rescue, but we won’t because the government keeps changing the “rules” and we remain confused and on the sidelines. Wanting to invest and help, but unwilling in these circumstances.

35. Comment by B Scott

    November 13th, 2008 at 11:25 pm

    The Gov,t can,t “draw a line” these politicians with their crayons, are still at the scribbling stage.

36. Comment by GARY FONG

    November 14th, 2008 at 2:55 am

    Alexis,

    You’ve hit a good topic regarding “saving”. I have heard so many pundits saying that if the U.S. starts increasing their savings rate, consumer spending will crash and there goes the economy.

    I was a wedding photographer for 20 years. I knew I didn’t want to do that forever, so I saved and lived well below my means until I was able to retire at 42 with wealth.

    I’m also chinese, born in America. My dad and grandfather pounded into my mind the saving mantra. It’s cultural. I’ve heard this theory that the Chinese have a high savings rate because in China there are no social programs to take care of them when they age. That’s not the reason necessarily. It’s cultural.

    I want to be optimistic about the U.S. like you, Alexis. I know you were calling the rally real, etc. and I wish I had the same opinion. But I’m pretty sure I see what’s coming.

    I just got my permanent residency papers approved for Canada. It took two years. I can’t stay here - I just see what’s coming and don’t want to witness a third-world America.

    G

37. Comment by jeff saturday

    November 14th, 2008 at 9:05 am

    When are these stimulus checks and bailouts going to start coming with a warning ?

    If your stimulus check lasts longer than four hours , seek immediate medical attention.
    Ask your congressman if you are irresponsible enough to want a stimulus check or a bailout.
    If you are responsible , stimulus checks and bailouts may cause nausea and vomiting.

38. Comment by chuck

    November 14th, 2008 at 9:37 am

    I’d like to see the money go to help the depressed housing market. Instead of other industry hand outs.

39. Comment by john

    November 14th, 2008 at 1:24 pm

    I am for absolutely ZERO bailouts. I was not for the $700billion, and am definitely not for the auto industry bailout, city bailout, state bailout, or any bailout.
    If this continues, I need to find out where to get in line so that I can go ahead and default on my mortgage payment, and where I can get my bailout.

    I think around $850,000 should do it.

    Why should I continue to pay my debts on time when the government and the news media is encouraging all to be taken care of. NANNY STATE.

40. Comment by mia dodi

    November 14th, 2008 at 1:37 pm

    OBama said he would not provide credit to any corporation that outsources jobs to other countries outside the united states.By bailing out the auto industry Obama will be doing exactly what he said he would not do.It will be another campaign Lie.

41. Comment by sullivane

    November 14th, 2008 at 5:03 pm

    I believe ‘bail-out’/ dish-out line should be drawn after retiree’s Retirement Funds have been replenished in part or whole. Many retiree’s Reitement Funds are on a non-stop ride down the toilet .. Retiree’s need operating capital as well as the next bank or corporation etc .. Bail-out could add a year or two to retirement living. After all, we retiree’s must maintain our current middle-low income standard of living for sometime to come ..

42. Comment by chris

    November 15th, 2008 at 11:59 am

    Alexis what I think is the govt shouldnt get their hands in any business they cannot control their own inside spending. The more the govt gets its hands into these business the more this country turns from being a free market country to a communist country like cuba. If a business is run correctly they would be trying to come out with new innovations. Trying to be one up on its competion instead these companys got lazy an fiqure govt will help them if they fail. We teach our children to walk with their heads up because if you dont your probably going to walk into something or miss something going on around you. Maybe we should treat these corporations like children because as adults they are dueing a crappy job

43. Comment by Jack Frayer

    November 15th, 2008 at 11:21 pm

    The pending bonus payments should be such a line. There is, by the way, a distinction between a bonus and a commission. I believe that any company that receives US Government money that gives a bonus or distributes a dividend should have to give the money back and take their chances alone. Another line is that no money should go for financial or business consolidation. This just causes more job loss and more problems. Unless you want the US to lose its world power status, the funding of business and local government needs to be multidimensional. Its too late to go back now. As demonstrated by the financial institutions, the money needs to have strings attached– equity purchases without controlling the board leads to undesired results. Give money to GM and Ford; but, control them to make a product that Americans will buy. Worst case, government incentives can make GM and Ford more successful than the competition.

44. Comment by Clarence Meadors

    November 16th, 2008 at 11:41 am

    We should never have bailed out fannie or freddie. You have people like Harry Reid and Barney Franks wants to let people get loans that cannot afford them, and that got fannie and freddie in trouble.
    The people that runs our goverment should not get involved in anything. They ruined the airline industry, they ruined the trucking industry, they broke social security and medicare. What in the hell make them think they can fix this.

45. Comment by martha

    November 16th, 2008 at 8:39 pm

    I am a lifetime Republican and have always believed in small government but the failure of the Big Three would lead to a depression. The amount of jobs that are related in some way to the car companies are in the millions. If all of those are lost we will have a much higher rate of mortgage and credit card defaults than we do now. The taxes paid by all of these companies and workers would be immense. Plus, put all of those workers on unemployment and then welfare and this will cost the government alot more than 25 or even 50 billion dollars. Last, we can not be a world power without a manufacturing base. Who do you think made the biggest difference in WWII? The car companies! Since when did Detroit become a dirty word?

46. Comment by Paul from Michigan

    November 17th, 2008 at 12:05 pm

    There was and still is wholesale removal of manufacturing from the economic base after 2000 (aka China’s “miracle”). Millions of well paid jobs were replaced by service sector jobs, many in the very low-pay area of leisure and hospitality (waiters, chambermaids, etc.)Why did it happen? Because neo-liberal and neo-con policy makers made a conscious decision to replace manufacturing with its pesky labor unions and associated politically troublesome middle class, with an indentured social class of dependent service workers. All in the name of “free” markets, of course. What does it mean? The imminent end of the US as a superpower. Supercomputers and fuel cells are not developed by a java-and-jelly donut economy. Globalization means that education, knowledge and technology are, in fact,transferable. In the absence of a local base of utilization high value-added jobs are free to go where they please. Government’s also distort the price mechanism by injecting excessive pools of money into the market. In a free market where the money supply is constant, wealth is produced by savings and production. In this environment, savings would go into production and prices would be going down as production increases. Instead our banking system has discouraged savings that would have gone into production, replacing savings for debt that goes into consumption at the expense of production. This is why we have inflation. The US is now consuming more wealth than it is producing, another reason why we are burdened with debt and sinking into a depression. In a free market, a company has to serve consumers to make a profit; otherwise it will go out of business. If it is corrupt it will be inefficient at producing value for consumers and lose business. If it fails, its failure is limited to investors and employees; consumers will go elsewhere. But if government steps in to protect business from the whims of consumers, it spreads those inefficiencies to society at large. Because government has a monopoly on force, businesses find it in their interest to lobby government to protect themselves from the whims of consumers. In a word, this describes Statisism. Finally we have consumers who are also voters. As voters, they find it in their interest to vote for the politicians who offer the most freebies, thus saving them the effort of earning what they have by living off the production of others. Taxation is a form of theft; government robs Peter to pay Paul. This is why socialism has mass appeal and why socialism impoverishes any nation that takes that path as history bears. They use free market language to disguise the protection they give to business to commit fraud and theft against the public. The shame of it all is that through mass indoctrination in school and media propaganda, people are afraid to be free. You fail to understand that we are not operating under a free market capitalist system in any sense of the word. A market is composed of individuals acting according to their self interest. If there was such thing as a society that acted in a uniform manner, it would be as easy to predict human behavior as it would be to predict the effect of gravity on a body. Rather, each individual is unique unpredictable force acting in his own interests. The number and kind of economic decisions people act upon is impossible to know and calculate. When governments interfere with those decisions, they invariably produce side effects they can’t foresee. The first interference produces an unexpected result typically resulting in a continuous chain of interferences to correct the preceding interference. This goes on until the market breaks down. This is why we are facing such a deep and long depression. The market didn’t fail as commonly perceived; the market is sending signals, warning us it is badly managed. If some among you fear taking a stand because you are afraid of reprisals from customers, clients, or even government, recognize that you are just feeding the crocodile hoping he’ll eat you last. What we need is neither anti-socialism nor anti-communism but an open positive endorsement of that system to which we owe all the wealth that distinguishes our age from the comparatively straitened conditions of ages gone by. Minsky argued correctly that a key mechanism that pushes an economy towards a crisis is the accumulation of debt. He identified 3 types of borrowers that contribute to the accumulation of insolvent debt: Hedge Borrowers; Speculative Borrowers; and Ponzi Borrowers.
    As you see the balance of mixed economics bears fruit we do see today. Freedom is more of a burden and an obligation than an option or a right. Above all, learn to never, ever trust the competence of government officials. We need core government function’s only to survive this morass and new predicated cycle. A good start is read Rerum Novarun to your edification also.

47. Comment by chuck

    November 17th, 2008 at 2:23 pm

    Just this morning Rush Limbaugh broke a story on the suppose auto industry bailout. The Southern Governers have spoke up with opposition to the bailout of the Detroit automakers. Here in Mississipp there are two auto plants one is Toyota and another is going to be constructed even as I type this. In Alabama there is Mercedes Plant right across the state line. The governors explain there isn’t no problems with their auto industries. Suggestion why not get the CEOS of Toyotas and others who located here in the Southeast and get thier persepective on the Detroit Debacle.

48. Comment by Mike Boorum

    November 17th, 2008 at 3:12 pm

    I think that if the bail out is really supposed help mainstreet instead of wallstreet. The bail outs for poorly run companies, and businesses should stop now. Normal everyday people can not get a loan if they are a bad risk so why should it be any different for bad companies, and businesses? If we really want to do a bail out that would work look at it this way. The United States population is approx. 300 million people, and that includes women, children, men. If each was given 1 million dollars for a total of 300 million dollars this would be a cheap bail out. There would need to be stipulations that all would pay off any bills they had before they spent the rest, but you know this would get the economy going again, and would help get all businesses busy again. I say put the money where it is really needed, and that’s not into bad businesses that will only take the money, and just fail later instead of now.

49. Comment by Eugene

    November 18th, 2008 at 11:19 am

    Alexis, the problem isn’t housing, financial institutions, or auto makers. These are symptoms of the problem.

    The problem is an intrusive government, that inserts political agendas into the market place. Further this same government has no regard for the common sense of it citizens. It only has regard for PACS, Unions, and power brokering. These bailout are about parrying blame and excaping accountability.

    This is the problem that we should all be angry about. The rest of this stuff is nothing more than a very expensive smoke screen, that in the end will result in even more government intrusion.

50. Comment by mike frick

    November 18th, 2008 at 3:01 pm

    Bailouts.

    Principals

    What principal is it that allows the robbing of Peter to pay Paul?

    Things are not black and white you may say.

    Principals are black and white.

    You believe in a principal or you don’t.
    You hold, stand, fight for a principal, or you don’t.

    If you compromise your principal you have lost.

    Individual freedom, I thought, was The United States of America’s principal.

    The right to life, liberty, and the pursuit of happiness principal.

    The rule of law and the Constitution principal.

    Robbing Peter reduces the life, liberty, pursuit, the individual liberty of Peter.

    What principal is it that allows the robbing of Peter to pay Paul?

    I would like to see more talk about principal, about philosophy,
    in the talks on bailouts.

    Mike Frick
    Yorkville, Illinois

51. Comment by Jan

    November 18th, 2008 at 4:51 pm

    I just saw a guest on your network today - his comment was why not give every American who is elegible $100,000 and let free enterprise take off! What a great idea - yes, we can all figure this out and get the country moving again - ask yourself……….since when did the government ever do a good job of managing money? Why should we continue to enable their bad spending habits. I say everyone………ask for your check, asap!!!

    thanks for listening.

52. Comment by Marshall

    November 18th, 2008 at 6:43 pm

    First we spent our earnings.
    Then we spent our savings.
    Then we spent our home equity.
    Now we have nothing left to spend.

    Paulson has bailed out his wall street gambling buddies with our children’s future.

53. Comment by Marshall

    November 18th, 2008 at 6:52 pm

    If we distributed the 700 Billion dollar bailout among the people, every man, woman and child would receive $2,333.33 along with a bill for the same amount. Now we are just getting the bill and the wall street crooks are getting the money. You know the ones who got MILLIONS in bonuses every year.

    If you think I’m a whiny Democrat, you’d be wrong. I’m as conservative as they come. But nutts is nutts.