Tentative Bail-Out Plan Reached

[socca]

Originally Posted by ChrisC

Wanna bet?

The "taxpayers will make money on the bailout" prediction relies upon many assumptions. Do you know what they are? What happens if your assumptions turn out to be false? The "taxpayers will lose money on the bailout" relies on fewer assumptions, because it's a lot easier to lose money on an investment than make it.

Originally Posted by Finance Dave

I say let the market work.

You might enjoy this anti-bailout article, which I mostly agree with:

David Sirota: Top 5 Reasons to Vote Against Paulson's $700 Billion Bailout

Echoing what other have said, I'm amazed just how much power and flexibility the legislation gives the Treasury Dept. We are relying on the judgment of Treasury officials, contractors, and subcontractors to intervene constructively. I didn't see any sign that pre-approval or discussion is required before any particular intervention; instead, the oversight committees just review what has been done. Remarkable.

[Retire Soon]

Originally Posted by al_bundy

if it was a house i'd probably stay. a condo i'd give back to the bank like i had bought it from wal mart

When DD and SIL first started discussing their dream of buying a home, we actually tried to talk them out of it. They were caught up in the euphoria of the moment and thought they could make 20k or 30k within a year and then buy a house.

We could see the train wreck coming and tried to talk them out of it. But, of course they knew much more about it then old mom and dad. Now they're stuck in an upside down investment.

[al_bundy]

C-SPAN Live Stream - C-SPAN

if anyone wants to watch it live

[ziggy29]

Glad to see they managed to rush this deal to avoid a market selloff today...

[socca]

My Sunday paper ran an advertisement for the sleep-aid medication Ambien. In the fine print was the following warning:

After taking Ambien, you may get up out of bed while not being fully awake and do an activity that you do not know you are doing. Later, you may not remember that you did anything.

Activities include:
+ driving a car
+ making and eating food
+ talking on the phone
+ having sex
+ walking
+ voting on bailout legislation

The Washington Post reported today that the financial services industry has supplied the entire Congress with free samples of Ambien. This does not bode well for this nation.

[Dawg54]

Originally Posted by ziggy29

Glad to see they managed to rush this deal to avoid a market selloff today...

Looks like the beginning of a sell off is in progress. The talking heads are saying were in for a global recession even if this thing passes. Lord knows what will happen if it doesn't pass.

Time to go build a bomb shelter in the backyard.

[ziggy29]

Originally Posted by Dawg52

Looks like the beginning of a sell off is in progress. The talking heads are saying were in for a global recession even if this thing passes. Lord knows what will happen if it doesn't pass.

Classic example of "buy on the rumor, sell on the news" IMO.

I think global recession is already very much priced in the market. But as long as there is uncertainty and borderline panic, markets are certainly known to overshoot in both directions -- sometimes drastically. These create the bubbles and the once-in-a-generation buying opportunities for those with the stomach for it.

[al_bundy]

last i heard SP500 earnings were supposed to be $63 for 2008. reality will probably close to $50. not sure what 2009 is supposed to be, but if they are $55 then the market is probably too expensive at this level

[ChrisC]

Originally Posted by socca

The "taxpayers will make money on the bailout" prediction relies upon many assumptions. Do you know what they are? What happens if your assumptions turn out to be false? The "taxpayers will lose money on the bailout" relies on fewer assumptions, because it's a lot easier to lose money on an investment than make it.

The only major assumption I'm making is that housing is not in a free-fall and that the housing bottom will be around the corner. My minor assumption is that the reverse auction and other pricing mechanisms will price the securities below current fair value and the purchase price is significantly less than value of these securities when held to maturity.

Aren't your assumptions for failure just the reverse of this? Or do you have some other insights?

Wanna bet.

[cute fuzzy bunny]

Originally Posted by ziggy29

Glad to see they managed to rush this deal to avoid a market selloff today...

At least theres some good news. Oil is still dropping like a rock!

[ziggy29]

Originally Posted by al_bundy

last i heard SP500 earnings were supposed to be $63 for 2008. reality will probably close to $50. not sure what 2009 is supposed to be, but if they are $55 then the market is probably too expensive at this level

P/E is a terrible indicator of valuation in an economic downturn.

[al_bundy]

Originally Posted by cute fuzzy bunny

At least theres some good news. Oil is still dropping like a rock!

too bad gold is not and t-bills aren't. end of the world trade is still in full swing