Korean Job Discussion Forums

[Leslie Cheswyck]

[Ya-ta Boy]

[Kuros]

[mises]

Dammit you people are listening to the same people who caused this crises or ignored the looming crises. Now they are crying for a huge bailout and you're trusting them.

Not bailing them out WILL NOT cause a depression. Bailing them out MIGHT.

[Gopher]

[blaseblasphemener]

There is another choice, the Swedish choice.

The money is given, but the government gets ownership, not just giving out a loan.

No one is talking about it because Wall Street wants its' cake and eat it too.

[sojourner1]

The government is taking possession of banks when they fail, but it's handing them back over to other leaders of the same feather. The government is still solvent enough to prevent disaster by consolidating failures into other banks like we're seeing, but this can't go on. This solvency is based on what seems like a never ending supply of debt to finance this failure caused by incompetent leaders. Companies have not been hiring competent professionals due to the desire to cheat, because competent professionals follow ethics and the rules of the game instead of lobbying the government to bend over backwards for their intentional mistakes out of greed.

I say hold a special vote on whether to bail them out with the $700b or do something else like reinvent an economy that works for the people. We need to have a special vote and if it were a true democracy, they'd let the people decide what to do.

[mises]

America is not a financial superpower anymore. This, for the same reason that I am not going to capitalize a large hedge fund tomorrow. I (it) doesn't have enough money.

It is over.

The US needs to accept that it is going to be (in the short/medium run IF the economy is run well) a "bottom" in international finance because it does not have any money.

This whole 700b bailout is the US trying to preserve that which is gone. It is NOT a financial superpower anymore. I still can be an economic one. And that is much more powerful.

[Ya-ta Boy]

[Tiger Beer]

[gangpae]

What some contributors on this thread don't seem to understand is that the financial system has already collapsed. Perhaps sometime in the future economists will identify the exact mortgage default that set the disaster in motion, but now the when and why are moot. Compared to 1929 the problem is even more pernicious, because now the core source of the problem (mortgage default) has been so well discombobulated into derivatives beyond human comprehension, it may take years, nay decades to figure out.


The laws of economics dictate that market decisions are governed by fear and greed. Fear tends to impinge on liquidity, and the present fear will put a squeeze on liquidity tighter than a bull's butt in fly season. No liquidity and the whole system grinds to a halt. Precipitous decline in demand will create deflation, and deflation is a financial whirlpool almost impossible to escape from, because what tools to do central bankers have for fighting deflation?

Have no doubt September 14, 2007 equals October 28, 1929, and failure to take action would be nothing short of criminal negligence, resulting in severe economic hardship around the world. Of course 700 billion is a low-ball figure, and it may well cost much more to sort the mortgage mess out. It will definitely mean higher taxes and a whole different set of problems, but we need to stay in the game and slog our way through this problem. Laissez-faire may well work, but what if it doesn't? I am not brave enough for the risk and prefer to err on the side of caution.

[khyber]

Here's a guy not in government (I think) who provides some great ways to avoid this credit hoopy loopy again.
http://businessbytes.blogspot.com/2007/08/market-meltdown-smoke-and-mirrors.html

[RJjr]

These banks that are failing have proven themselves to be incompetent losers. If the bankers want money invested in a loser, maybe they should put their personal fortunes on the 1 win, 3 loss Mississippi State Bulldogs to win big today and leave the money of other Americans alone.

[canuckistan]

Of course the bailout is deplorable, but markets are all about psychology.

[Privateer]