The latest round of bailouts - can someone explain?

[Meadbh]

Merriam-Webster has picked "bailout" as the word of the year.

"The rest of the list is not exactly cheerful. It also includes “trepidation,” “precipice” and “turmoil.”"

 

[UncleHoney]

I wonder if the government really did their homework this time around. The banks can make all the money available they want but if there are few takers then it won't work. Did they ever consider the average consumer may not be willing to assume more debt right now? Just a small problem maybe.

IMO, the consumer has been poisoned in the last year and the desire to take on more debt is fading fast. Right now a lot of people are starting to worry about losing their jobs or falling behind in current debt obligations. Do the FEDs really think there is a pent up desire for more problems?

What if the big spenders got just a little "religion" the past few months? Maybe that three year old SUV isn't that bad after all since gas prices have come down and besides you can't tell the difference between it and a new one.

My guess is the rate of decay will speed up in the next six months as more jobs are lost and more belts get tightened. Right now the non spending consumer is in control. It's all a function of the "pucker factor" and it's running at an all time high.

 

[samclem]

I wonder if the government really did their homework this time around. The banks can make all the money available they want but if there are few takers then it won't work. Did they ever consider the average consumer may not be willing to assume more debt right now? Just a small problem maybe.

IMO, the consumer has been poisoned in the last year and the desire to take on more debt is fading fast. Right now a lot of people are starting to worry about losing their jobs or falling behind in current debt obligations. Do the FEDs really think there is a pent up desire for more problems?

What if the big spenders got just a little "religion" the past few months? Maybe that three year old SUV isn't that bad after all since gas prices have come down and besides you can't tell the difference between it and a new one.

My guess is the rate of decay will speed up in the next six months as more jobs are lost and more belts get tightened. Right now the non spending consumer is in control.

This is probably what is really behind President Elect Obama's "make work" idea. We don't truly need a jobs program now--unemployment is not outside historical norms. Rather, since the consumers are a bit hesitant to take on more debt and to spend a lot (based on the reasons you list), it's time for the government to do the borrowing and spending. I guess it is better than just giving more piles of money to the banks or shoveling it down some other black hole. But only a little. The plan changes by the week--start, stop, reconsider, take a new approach. Anyone who has seen an individual in total panic mode has witnessed the same pattern. It doesn't inspire confidence.

Maybe the govt could just get out of the bailout/stimulus biz.

 

[Frugality_of_Apathy]

This is probably what is really behind President Elect Obama's "make work" idea. We don't truly need a jobs program now--unemployment is not outside historical norms. Rather, since the consumers are a bit hesitant to take on more debt and to spend a lot (based on the reasons you list), it's time for the government to do the borrowing and spending. I guess it is better than just giving more piles of money to the banks or shoveling it down some other black hole. But only a little. The plan changes by the week--start, stop, reconsider, take a new approach. Anyone who has seen an individual in total panic mode has witnessed the same pattern. It doesn't inspire confidence.

Maybe the govt could just get out of the bailout/stimulus biz.

Jobs might not be a problem at this very instant but that's one of the huge problems with government. Everything is reactionary and more expensive and too late. The unemployment rate at the beginning of 1930 was 3.2%.

Hey a couple more stimulus packages, a nice four-year plan, and we'll be living in a communist paradise. I'd give old Joe Stalin a job well done thumbs up if I hadn't cut off my thumbs for being subversive fingers performing actions that they claim not all fingers are capable of. Solidarity comrade!

 

[OAG]

It is all "busy work" up to this point, IMO. The Government does not want to look like it is doing nothing - so it tries to look busy. I just hope they do not destroy the future for all the survivors.

 

[chinaco]

Generally, I think they are trying to contain the financial problem but they are not sure how to do it. And I believe it is being done with integrity and honesty.

But I always wonder if some of the guys making the decisions and handing out the free money are helping their buddies out with a few billion... There seems to be few checks and balances... well what are friends for... Who would know if all handouts are justified?

 

[FinanceDude]

Generally, I think they are trying to contain the financial problem but they are not sure how to do it. And I believe it is being done with integrity and honesty.

But I always wonder if some of the guys making the decisions and handing out the free money are helping their buddies out with a few billion... There seems to be few checks and balances... well what are friends for... Who would know if all handouts are justified?

The ties between Wall Street, the big banks, and the Federal Govt runs strong, fast, and deep. How do you thing those Senators can spend millions to get re-elected when their salary is less than $200,000 a year?

 

[mb]

ROTFLMAO!!

I think I'll take our military over China or Russia's..........

Read Paul Kennedy's book The Rise and Fall of the Great Powers.

I think that it provides a convincing argument that:

- Great Powers rise as Great Powers because they grow their economy.

- Great Powers fall because they over extend themselves militarily.

 

[barbarus]

Jobs might not be a problem at this very instant but that's one of the huge problems with government. Everything is reactionary and more expensive and too late. The unemployment rate at the beginning of 1930 was 3.2%.

Hey a couple more stimulus packages, a nice four-year plan, and we'll be living in a communist paradise. I'd give old Joe Stalin a job well done thumbs up if I hadn't cut off my thumbs for being subversive fingers performing actions that they claim not all fingers are capable of. Solidarity comrade!

Stalin would approve heartily of the way the government has been running our finances. Be it Comrade Bush or the upcoming Comrade Obama, there is not much more in the the way of Bolshevist economic intent than what we are seeing right now in Twenty First Century America.

I'll yet again draw your attention to my avatar.
He's Hank Paulson's main man dudes.

 

[kumquat]

I am trying to figure out what 'back to work' program Obama's folks will come up with that both targets the skills of the unemployed and invests in infrastructure.

While repair of roads and bridges is badly needed I don't see that addressing un or under employment because a lot of the unemployed are white collar or hammer & nail gun construction workers. However, odds are asphalt is cheaper right now than it has been for a couple years.

Manufacturing solar and windmill electrical generation would create/maintain manufacturing jobs... something like the BPA or TVA for green energy would be a model.

Some white collar workers could be useful to help in schools, our children are our human infastructure.

Now, what to do with all those unemployed Wall Street financiers...

Thoughts folks

Is there any reason the underemployed 'white collar' types can't dye the collar blue? I spent 30 years wearing a white collar, but I helped family with blue collar projects. I still hold a 'big rig' drivers license that I haven't [-]needed [/-]used since I was 20.

If you're unemployed,any employment should be better than none.

 

[samclem]

Let's see--the new President-elect wants to dump money into a jobs program to employ Americans. Apaprently he believes we need to have more jobs.

And he also thinks it's a good idea to help those illegal immigrants who are already here (driving down wages for low skill jobs) to stay here.

At the risk of veering into the Soapbox, I'd like to suggest that these two initiatives might not be entirely in sync--that there might already be jobs available in America--it's just that they aren't being done by Americans. Good ID's, immediately verifiable, with strong punishments for employers who hire illegal immigrants: suddenly many "new" jobs without needing to deport anyone.

 

[laurence]

Let's see--the new President-elect wants to dump money into a jobs program to employ Americans. Apaprently he believes we need to have more jobs.

And he also thinks it's a good idea to help those illegal immigrants who are already here (driving down wages for low skill jobs) to stay here.

At the risk of veering into the Soapbox, I'd like to suggest that these two initiatives might not be entirely in sync--that there might already be jobs available in America--it's just that they aren't being done by Americans. Good ID's, immediately verifiable, with strong punishments for employers who hire illegal immigrants: suddenly many "new" jobs without needing to deport anyone.

Ah, but will U.S. citizens work them? Being poor in America doesn't mean starvation the way it does in some other countries (part of why the U.S. rocks).

If we are going to throw billions of debt onto future generations, at least let it be for infrastructure. The interstate system is falling apart, we are way behind in power production and distribution infrastructure. We might actually benefit from that spending. I even think the Constitution says something about interstate commerce, so it probably won't make our forefathers spin in their graves, either!

 

[brewer12345]

If we are going to throw billions of debt onto future generations, at least let it be for infrastructure. The interstate system is falling apart, we are way behind in power production and distribution infrastructure. We might actually benefit from that spending. I even think the Constitution says something about interstate commerce, so it probably won't make our forefathers spin in their graves, either!

Bridges, water treatment systems, dams and levies... Can come up with lots and lots of things badly in need of repair and deferred maintenance, let alone expansion and improvement.

 

[lets-retire]

Ah, but will U.S. citizens work them? Being poor in America doesn't mean starvation the way it does in some other countries (part of why the U.S. rocks).

Yes they would. Not long ago, we stirred up a fecal matter storm when we drove a Free Trade Zone and started arresting illegals. We saw approximately 40 illegals. We were only able to grab two because it was in impromptu operation. The rest got away by running through the swamps and swimming through the bayou. The company leadership was very upset, because we chased away about 10% of their work force. They even threatened us with injunctions limiting our access to the area. The jobs we saw them doing paid anywhere from $8-$15 per hour. Many of their American co-workers thanked us for doing it.

 

[barbarus]

Bridges, water treatment systems, dams and levies... Can come up with lots and lots of things badly in need of repair and deferred maintenance, let alone expansion and improvement.

Indeed, but the money to carry out that work went to Iraq.

Just as soon as we find those weapons of mass destruction much funding will be freed up to improve the crumbling American infrastructure.

Maybe even restore a bit of the Constitution, although it won't be very popular with the Democrats. Or the Republicans.