Market up 300 at the open

[126coupe]

Sheesh, The Govt is taking 250 large and investing in US banks with "our" money.
Who says I wanted to be in he market

[competentone]

Originally Posted by Minkoff

Sheesh, The Govt is taking 250 large and investing in US banks with "our" money.
Who says I wanted to be in he market

But it really isn't like you are in the market.

With the position the government is putting you in, you have all the risk for losses with no potential for gain.

When you get into the market yourself, you have both the downside risks and upside potentials for gains.

As others have said, this is all about the privatization of profits and the socialization of losses.

[jyl]

Originally Posted by Minkoff

Sheesh, The Govt is taking 250 large and investing in US banks with "our" money.
Who says I wanted to be in he market

Would you prefer to have 1 or 2 large US money center banks (think Citigroup) fail, 1000+ smaller US banks also fail, amid a cascade of bank failures around the world?

If global governments manage to rescue the banking system (Europeans are doing the same), these investments will pay 5-9% annual interest plus the banks will buy back the preferred shares when they are strong again.

If not, then $250BN now won't matter so much, because we'll be in a depression and the govt will be spending far more than that to just keep the economic heartbeat going.

[legion]

Originally Posted by jyl

Would you prefer to have 1 or 2 large US money center banks (think Citigroup) fail, 1000+ smaller US banks also fail, amid a cascade of bank failures around the world?

That's the root of the problem. We have all of our eggs in just a few, huge baskets. We should be breaking up the huge banks so that the consequences of stupid decisions are more isolated.

The problem we have now is that one mega-bank does something stupid, all of the other mega-banks follow for fear of missing out on profit before the stupidity is fully realized.

[competentone]

Originally Posted by jyl

Would you prefer to have 1 or 2 large US money center banks (think Citigroup) fail, 1000+ smaller US banks also fail, amid a cascade of bank failures around the world?

YES!

Then the government pays out a few trillion in FDIC insurance and the people who were least responsible for creating this mess get the "new money" first.

Right now, we are giving (newly created dollars) to the exact a**holes who created this mess.

We are allowing these a**holes to continue in their positions of "prestige and power" when they are really just con-men who have ripped people off for billions with their schemes.

If we let the fraud be exposed (yes, it will be painful for all those who are currently unaware that they are victims of fraud), we can start rebuilding on a solid foundation without the criminals who created the mess still in the mix.

All this bailout is doing is allowing the "confidence men" to continue with their paper money scams.

"Con man" is just a shortened way of saying "confidence man" -- listen to who is calling for a "restoration of confidence" in these markets. The markets are in trouble because people have put too much confidence in the government and Wall Street.

We need more skepticism and more due diligence in these markets, not more "confidence."

[sammyg2]

Originally Posted by Minkoff

Sheesh, The Govt is taking 250 large and investing in US banks with "our" money.
Who says I wanted to be in he market

Find A really old guy and ask him what life was like during the great depression.

[turbo6bar]

Originally Posted by legion

That's the root of the problem. We have all of our eggs in just a few, huge baskets. We should be breaking up the huge banks so that the consequences of stupid decisions are more isolated.

The problem we have now is that one mega-bank does something stupid, all of the other mega-banks follow for fear of missing out on profit before the stupidity is fully realized.

Yep, we have wells buying out wachovia, other big names taking over smaller names. We're raising the bar for "too big to fail."

Smaller institutions that played it safe are basically subsidizing the dumbass big shots who whipped it out at will.

That said, I favor capital injections like the $250B equity deal. Don't buy their bad deals. Give them support so they can suffer through their bad debts.

Let's get rid of this stupid "financial innovation," and get back to credit with reasonable boundaries and a common sense approach. If it means we suffer for a few decades, so be it, particularly, if it means we don't have these absurd twice per decade boom-bust cycles.

[Jim727]

Originally Posted by legion

That's the root of the problem. We have all of our eggs in just a few, huge baskets. We should be breaking up the huge banks so that the consequences of stupid decisions are more isolated.

The problem we have now is that one mega-bank does something stupid, all of the other mega-banks follow for fear of missing out on profit before the stupidity is fully realized.

Legion advocating government regulation?!?! What has happened to PPOT in my absence??

Actually, have had way too much on my plate to participate lately, but have read a few threads about this banking/credit problem. It may well be that some form of "bailout" is a practical necessity, but it can never be the cure - I'm very much on board with Number Six on that.

Ultimately, we have to get past the "living on credit" mentality to develop a good financial foundation. That won't be easy or popular, but one lesson - previously learned in the Great Depression - and sure to be learned again is that those not swimming in debt will come out of this the best. Perhaps the only way to drive the lesson home is to let the house of cards fall.