What Taxpayers Get From the Bear Stearns 'Bailout'

Capitalism is fine. Human greed makes me sick!

Plain and simple: When you have a business, it's your responsibility to set aside money to bail yourself out in time of need. Every small successful business owner knows this, and for some, have experienced and survived this.

My point? So why couldn't those higher-ups who pocket all the money and put it into savings pull it out from their savings and bail out themselves? Oh, that's right! They're entitled to keep that money they earned. The 15% per week in federal taxes that I'm NOT entitled to keep is for bailing out multibillion dollar corporations.

The crooked feds give up more money to one company than to an entire nation of people who are mooching off the government. Well, at least those people who are mooching are putting the money back into the economy.

AnarchyLibertarian of GA @ Jun 20, 2008 03:28:53 AM

The entire system is broken.

Although many are defending this scheme as "a loan, not a bailout", it IS a bailout. Bear Stearns stock was valued at $170 per share a year ago. JPMorgan bought this stock at $2.00 per share. The shareholders have been fleeced already, the taxpayers are now being fleeced further. The economy we have is not the problem, it is our continuous efforts to control said economy that cause these inflated bubbles. The constant calls for "liquidity" in the markets, that are answered by the FED with more spiraling debt, are not a sustainable solution. If I have $10.00, I can only loan it to 1 person. Banks are different. They can loan that same $10.00 to 10 people. Where does the extra money come from? Nowhere. It is not from a deposit in someone's savings account, or some pile of gold in Fort Knox, it is created on the bank's balance sheet by typing it in. That is the dirty secret that no one wants you to know. Constant calls for "liquidity" are how the bank's keep the debt swirling around so no one sees that the money is not really there. They can cover up the shortfalls by having enough ink on their balance sheets. That is where the FED comes in, by continuously propping up this ponzi scheme with more debt-based "liquidity". It is NOT a "government bank", it is a private corporation owned and run by banks. Do not believe the rhetoric. 30 billion for Wall Street, legally stolen from Main Street. Expect more of the same in the future, very wealthy bankers DO NOT care about inflation, it does not affect them.

Marc of OH @ Jun 04, 2008 12:22:56 PM

Reckless FED

You state that falling home prices would be a terrible thing. Look, the housing market is still way over-priced. Lower home prices means a higher standard of living.

THERE HAS TO BE A CORRECTION.

That's the problem with this entire economy. The Fed and the politicians do not want a recession so they keep lowering interest rates to spark more growth. Eventually, this reckless policy will have to correct itself and unfortunately when it does you will not have a mere recession you will have a depression...maybe not a ten year depression...but a depression nonetheless.

You can put off paying the market...but eventually it collects. FED or no FED.

of CO @ Jun 01, 2008 19:56:10 PM

for miss anti-capitalism-ist

if you don't like capitalism, go to france where they love socialism, they also love to protest because their unemployment rate is over 15% and no one is allowed to work more than 35 hours a week. socialism is an idea, not a practical application ( not one with success anyway). the pilgrims tried socialism and it failed because not everyone contributed equally, thus the reward system of capitalism for those who contribute more than others. that is why we ARE the most successful nation on the entire planet. (and yes i know the pilgrims did not invent capitalism, i was proving a point) now to address the "forced" work at 18. no one forces you, as a matter of fact there are many people who refuse to work, they are called welfare recipients. there's your socialism at work, are you happy that your idea of society is actually the biggest drain on society. let's pretend socialism works and that all contribute and receive equally, YOU STILL HAVE TO WORK TO CONTRIBUTE SOMETHING YOU GOOFY LIB.

if you have an issue with the bailout as a single incident, that's fine, but to bash capitalism because your don't want to work is pathetic. there is one community that has made socialism work in small groups, they are called the omish. go ask them what age they start working at, it's a far cry from 18 i'll tell you that.

signed: the blue collar, bottom of the pyramid capitalist working man who came from a christian single parent home, renting out a basement of someone else, to owning my own house with my own yard where my son can play, all by the age 23.

all thanks to capitalism and the american way.

ps wingnut, your socialist views are treason.

Zdan of VA @ May 09, 2008 01:22:34 AM

Michael Blomquist is off his rocker.

Point number 2, former Governor Spitzer's pathetic attempt at blaming bush got shot down by the OCC's chief at the time.

"Mr. Spitzer was also off the mark in repeatedly characterizing the OCC's actions as those of "the Bush administration." I was appointed comptroller by President Bill Clinton for a term that carried into the next administration, and the OCC's actions during my tenure were those of the OCC alone."

-John D. Hawke

Hawke and the current Comptroller rip apart the disgraced governor's attempt at blaming the administration for the OCC's actions.

See:

http://www.washingtonpost.com/wp-dyn/content/article/2008/03/05/AR2008030503016_pf.html

If Mr. Blomquist is as much of a lib as one would expect him to be, I'd direct him to the tards over at HuffPo who think that Spitzer's sexual indiscretion only was brought up because of his lackluster legal arguments. Then again, if Spitzer treated mortgages like he did prostitutes, he was probably screwing homeowners on the side.

See:http://www.huffingtonpost.com/steven-g-brant/eliot-spitzer-george-bus_b_91764.html

If Mr. Blomquist thinks this "bail out" was so illegal, I'd ask him to check Section 13.3 of the Federal Reserve Act, which was passed I think in 1932?

Please take your crazy conspiracies somewhere else, sir. Oh wait! The internet is the only place you have left... :(

William Gootman of OH @ May 06, 2008 22:05:54 PM

Moral Hazard

This problem goes beyond the solvency of Bear Stearns and even that of our financial system. Eric (first comment) gets props for the best argument. This is all about privatized profits and socialized losses; moral hazards.

As this catastrophe continues to cycle through our and the global economy we will see skyrocketing inflation, crime and social unrest. In addition this could lead to the next World War. Americans and congress became unglued about toys with traces of lead based paint, what will the globe think about securities tainted with fraud.

1) Paulson should be arrested for aiding and abetting loan and bank fraud. While he was at the helm of Goldman Sachs most of this toxic debt was originated and also sold through GS.

2) The constant blame placed on state regulators is false and only conceals the real problem. See Eliot Spitzer

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html

3) Karl Denninger writes:

http://market-ticker.denninger.net/2008/03/articles-of-impeachment-bear-stearns.html

please sign petition

4) The Executive branch issued a directive to the FBI to NOT prosecute fraud for housing. Under the United States Constitution our President is charged with caring for the faithful execution of law. As alleged by Spitzer, Denninger and myself (FBI directive); this is not a question of negligence, but obstruction of justice.

America wakes up we will have social unrest, skyrocketing unemployment, crime, etc. People will be fighting to survive instead of getting

Michael Blomquist of CA @ Apr 04, 2008 17:09:08 PM

The Solvency of the Mortgage Industry and renters

I can see there might be additional strain on rents at some levels, however,

rents and housing prices usually do not stay apart all that long. When housing prices crash, rents usually follow.

The people who walk away from their mortgages will have a very difficult time

renting due to credit histories. Those who cannot buy homes are already renting or

in a smaller home. As a renter, I am thinking it let it crash to where it should have been. No bailout.

KR of NJ @ Apr 04, 2008 14:38:06 PM

Not to defend the bailout, but...

Even if you rent, the solvency of the mortgage industry still benefits you. A scarcity of low-end credit can create a glut of renters, pushing rents upward.

But the really outrageous thing is that government now appears to be a tool for conducting multi-billion dollar business transactions. That isn't the way it's supposed to be, is it? Should taxpayers be forced into making a deal with JP Morgan that no sane private firm would make?

of DC @ Mar 31, 2008 12:13:21 PM