If Wall Street Doesn't Get a Bailout
The consequences of not passing the bailout plan—or as some in Congress and the financial world have renamed it, the "recovery" plan, are pervasive, painful, and possibly devastating. If small businesses can't borrow money to keep going, many will fail. They are the economic engine that keeps job growth steaming along. Right now, there is no job growth, only job decline. We can hardly stand by and watch record unemployment rates go up and up and up. Second, a new wave of bank failures will not only harm consumers but also drive Wall Street losses higher and higher. Third, it'll become much tougher to take out mortgages and student loans and to keep the flow of credit helping average Americans stay afloat. Last, if Congress doesn't do something, and fast, a crash in the personal credit industry comes next. People won't be able to pay off their credit card balances, and no one knows where that will take us.
Meanwhile, the Senate version of the bailout/recovery bill had some much-needed goodies for consumers to entice the protesters of last week into the "Yes, we now support the bill" category. Among the goodies are an increase in FDIC limits to $250,000 of protection for savings, up from an outmoded $100,000 amount. The 450-page proposal also includes tax breaks for business and the middle class.
Barron's writer Bob O'Brien notes:
(This, coming on a day when the national deficit is expected to eclipse the $10 trillion mark.) Other trinkets, such as an extension of jobless benefits and a homeownership tax break, might also get stapled on before a vote is taken. The expectation is that the added features would afford the legislation some momentum that would allow it to hit the Senate chamber running. (Though if significant additions of heft actually make something faster, your average business journalist ought to be able to out-run that Usain Bolt fellow.)
There's hope the stock market's response and passage by the Senate of its plan will prompt House members to reconsider their "no" votes: "Congressional staffers now say they have begun to receive calls urging support for the plan, a sharp contrast from the weekend, when calls ran overwhelmingly against it. And in a new survey by pollster Scott Rasmussen, some 33% of likely voters now support it, vs. 24% last Friday," Business Week reported.
So if you're angry, adamant, and against, please understand that the person on whom you're venting your fury is yourself.
Tags: Wall Street | government intervention
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Reader Comments
Bailout, Goodies...my hind end!
I just have to give credit to the last statement posted under tittle "Goodies...my hind end!" This statement is totally true, I was about to refinance my house when the loan officer is the one who told me I should. Me and my wife was all heads over heels for it and about to sign the papers until we looked over the final draft of the loan. This would have put is so far into dept that we would have never been able to pay the house off. The point I am trying to make is that we as the people need to wake up and the people in power who knows better need be more mature and less greedy.Its like the banks are super hero's and in the eye of you they are not going to rob you, they are just trying to help you but in turn they decides to rob you because they can and you would never suspect them because there a super hero and they are suppose to save the day.
To finalize this passage I must repost what was said because this person put it best "Are some businesses going to fail? Yes. Are some people going to lose their homes (that they couldn't afford anyway)? Yes. I didn't see anything about this plan paying mortgages to bring them current...all I'm seeing is an opportunity for American's to get in deeper debt by "opening the credit lines". If a fat person can't stop eating from a neverending bowl of food, don't you, at some point, take away the bowl of food? Especially if you're just standing there watching???"
Bail out!
I am just totally confused.....I don't think that I'm alone.
Bonnie Erbe - Pro on Bailout's Financial Terrorism
Has corruption become so accepted in this country, have Americans become so numb to Capitol Hill corruption that the addition of $150 BILLION onto [what's ostensibly] a financial AID plan doesn't FaZe us??!? Amidst a "crisis", these financial terrorists still have time for pork?
Have senators (including the 3 that are in the presidential race - as well as Mikulski - how COULD you Babs?!) lost all sense of shame? Take note voters!
There is a reason this bill is being pushed with demon speed through both houses.
Not ONE of the senators took a stand during the vote to call their colleagues to task for the audacity to pile pork atop the bailout.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/10/02/MNR813AHDN.DTL&tsp=1
The larger obscenity from DC aside - the arbitrary large number of $700BILLION - it appears, even when America is hurting, those who would represent us can't help but continue to steal from us.
It would have been cheaper to buy each senator a yacht. But then, with their Wall Street friends, who needs a yacht?
From above :"MEMBERS OF CONGRESS WHO VOTE FOR THIS SHOULD BE JAILED FOR TREASON."
"Ms Erbe, your arrogance and blind willingness to embrace the scare tactics of the ruling class is laughable."
Fully agree with both.
Bonnie - ask Rep. Donna Edwards [D-MD] who's calling her registering Pro (Banks, financial institutions, etc) and Con (small business owners, worried home owners, etc.)
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