View Poll Results: For or against the Bailout Bill

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  • For it, lets let the Gov't Give our tax dollars to companies who, "need" it

    2 25.00%
  • No, let them solve their own problems

    6 75.00%
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Thread: Econmic"Recovery"(Bailout) Bill What would vote?

  1. #1
    Default Econmic"Recovery"(Bailout) Bill What would vote?
    What would vote, for the bill or against, since the failure of its first time through sent stockmarkets crashing(haha) they made a new one, would you vote yay, or nay

  2. #2
    Livin the iPhone Life 461am's Avatar
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    Last edited by 461am; 2008-10-01 at 03:08 AM.

  3. #3
    For it and if you don't understand why we NEED this bailout, it would do you a world of good to research about why this is really the ONLY choice 700 billion is little to how much is going to be lost. Hell on Monday the economy lost over 1 trillion dollars if that tells you something.

    I can go more in depth if anyone wants, but really, we really need the bailout. I can post a LOT more information regarding the current economic situation but I'll post this KOS journal that attempts to explain the whole thing:

    Imagine now that that human body, in its entirety, is the economy. Different parts of the body represent different sectors of the economy. So maybe an arm is the pharmaceutical sector. And maybe a leg is the IT sector, and another leg the energy sector. But the central system to the human body is the heart. If it doesn't function, all other systems in the body shut down.

    So go back in time about nine or ten years and think of the dot economy. I'm going to grossly oversimplify here, but as a member of the IT industry in my professional life, I saw the bursting of the bubble up close and personal. Long-standing practices of moving companies to initial public offerings (IPOs) were abandoned in the boom. Prior to the easing in lending regulations and standards, a company generally needed five years of business history and some consistent quarterly performance that indicated a path to profitability before it would be considered for IPO. Yet in the make-money-fast culture of the late nineties, those standards were abandoned. Companies with mere months of business history and no discernible path to profitability were being approached for IPO. Underwriting financiers would take preferred stock interest in those companies and amass stock for literally pennies per share. When the company publicly launched, those same underwriters would turn around and push the stock and cause its value to go up. They would wait until their best estimate of a peak and sell out, making ridiculous profits.

    The whole house of cards caught up with the bubble and the segment itself returned to some level of reality. But remember - in my example, I made the IT industry a leg. You can lose a leg and still live a full, functioning life.

    It is fundamentally different with the financial services industry. Because you can't cut out a heart without death of the remainder of the body that it supports.

    Blood that flows to and from the heart is comparable to money that flows through the market. The availability of money to leave the heart and travel to other areas of the body - market sectors - is what drives the overall economy. It touches EVERY area of the economy.

    Let's say you own a successful dry cleaners in your town. You're profitable, you manage your expenses well, and you've provided some number of jobs back to the community. All of your financial fundamental are in place for expansion. You've scoped out an area where competition will be minimized and where your proven business model is likely to thrive. You don't personally, however, have the money to take a lease on space and hire enough people to run your second location with all of its equipment requirements and the like. You need to borrow that. In a functioning economy, a lender would be happy to lend you the money to expand. You're a great risk - you have a business model that has proven to be successful. But you can't get the money. And you can't get the money because there IS no money to lend.

    Another example. Let's say you work for a large, multi-national IT company. Let's say further that the market has been kind to you. Your profit projections have consistently been spot-on quarter over quarter. All of your underlying financials are strong. You are in the top one or two in your market segment, and you certainly don't have your personal business invested in mortgage-backed securities.

    Only in many ways, you DO have your business invested in mortgage-backed securities, at least tangentially. Because you do what many business of your size do on a daily and weekly basis. You borrow money to keep your daily operating costs covered. That means payroll, benefits, etc., are covered in the short term with full knowledge that, at the end of, say, a quarter, you will fully pay those short term loans back. But the business bank who underwrites your short-term operating line of credit IS a member of the financial services industry. And because that industry is tainted by bad debt, and because THAT has caused credit of any kind to tighten, you now cannot take a 7-day loan to cover payroll. You and your 280,000 employees now are not able to meet your payroll obligations.

    A final example. Your car blows up. You don't live in an area where public transportation is readily available. You have a good job and a good credit history. You need a loan to get a new car so you can keep going t work and keep working. Only you can't get that loan. It has nothing to do with your personal credit-worthiness - it has to do with the fact that money simply isn't available to lend to you for buying a car.

    The financial services sector is the heart of the economy. They have ****** up badly in the last couple of years, but really, they've generally ****** up because we have allowed it. Companies don't exist to provide good jobs or good benefits. Companies exist to turn a profit, and public companies exist to return value to their shareholders. They are made to do this on a quarterly basis. A good quarterly report returns profit to shareholders. A bad one returns no profit to shareholders (generally). So why would we think, after removing regulations and failing to enforce most of those that remained in place, that Wall Street would do anything beyond what we have made it possible for them to do? And that, in a nutshell, is to work the system - mostly within the law - to return insane short-term quarterly profits and therefore shareholder value. The idea that business would think a) long term (when we are painfully short-term focused from a market perspective; and b) do things to benefit people rather than their own bottom line is counter-intuitive because we don't reward business for behaving in that fashion.

    Right now, we are literally on a tightrope called credit. Whether or not you have a job to go to tomorrow, and a job that can actually honor its payroll obligation, is an open question. If your company has enough cash on hand to pay its operating expenses, consider yourself lucky. Many other people, who work for good companies, will find that there isn't money for them to be paid. The heart will have stopped pumping blood to all extremities of the body economic.

    And a final few notes - this idea that Republicans have that the market can bear this out is ludicrous. Further ludicrous is the idea that some kind of mortgage insurance construct would work. If companies could make money with that methodology, they would have already been doing it. No one's biting because no one can underwrite this debt for the amount of time it will require for the paper amount to match the value of the underlying collateral.

    And the idea that all of these Representatives are getting "50 to 1" phone calls against the bailout does NOT remove them of their fundamental responsibility to be stewards of the American economy and the American public as a whole. This **** is complicated. The idea that the average person can fully understand the implications and the intricacies defies logic. I have the requisite education background and I don't fully understand all the details around the current economy and the implications of any rescue legislation.

    This is a sad, tragic day for America. Legislators decided that their need to be re-elected exceeded their responsibility to the Americans they represent.
    Last edited by Happy Noodle Boy; 2008-10-01 at 06:22 AM.

    I'm a helpful jerk, fear me.

  4. #4
    My iPod is a Part of Me bteamer's Avatar
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    good post happynoodleboy. I'm for it. (I'm doing my current event on it in social studies this Friday

  5. #5
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    Yes the world needs it, but it seems the congress are too short sighted to pass it. lol.

  6. #6
    I wouldn't say congress is, more like the American people are, and fully understand y we need it by I think it's, A a load of crap that greed got us in this position, and B that we should tell every other company, oh ur going bankrupt, here well give 700billion,
    I miss slick willy

  7. #7
    Retired Moderator one1's Avatar
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    I saved this right as the market closed since it was a historic moment that we hopefully will never repeat.
    Attached Thumbnails Attached Thumbnails -photo.jpg  

  8. #8
    moday was the one day i wanted stocks app on my fone and i had it poofed and didnt feel like unpoofing it cuz i was listening to music

  9. #9
    It's scary to think how bad the economy is right now. One year ago, the Dow Jones Industrial Average was at 14,000. Now it's at 9,500.

    Prepare for the worst, hope for the best.
    And it will be like a taco inside a taco within a Taco Bell that's inside a KFC that's within a mall that's inside your dream!

  10. #10
    Retired Moderator bhz1's Avatar
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    I saved this right as the market closed since it was a historic moment that we hopefully will never repeat.
    Came close today down over 500 points. This really blows This is the first of 8 straight years I will be paying for college tuition, and the next 4 will be for 2 kids,

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