Let the "good" times roll!

[Patroklos]

I don't care if people who took unrealistic teaser rates lose their homes. They NEED/SHOULD lose their homes.

[Whoha]

Originally posted by Oerdin
We certainly need more savings. The US has had a negative savings rate for years do to no forced savings mechanism, as other countries have, and a credo that consumer spending should be encouraged to speed economic growth. How about we use the tax laws to encourage or even force savings?

I would rather have wage growth encourage savings.

[Dinner]

Originally posted by LordShiva

Great video and an excellent example of why the do nothings are wrong. Japan adopted the do nothing approach in 1989 and it landed them with 12 years of deflation and economic stagnation mixed in with periodic recessions. The do nothings have it all wrong.

[Whoha]

Their do-nothing approach was to drop interest rates to zero, and permit people to hold on to clearly bad paper in a manner that is simply not allowed in the US. Or rather wasn't allowed at the time. I suppose this is starting to look like the Japanese Crisis.

[Dinner]

What are some positive steps which can be taken? First of all banks aren't lending to each other because no one knows what the exposure level of each bank is to this debt crisis so no one can tell who is a good credit risk and who isn't. New regulations forcing banks to tell the public what their exposure is will help inform the public & the market who is in good shape and who is in bad thus allowing the healthy companies to once again get credit to finance operations.

Bad loans need to get cleared off of bank balance sheets so they aren't left to fester for years as happened in Japan. A Federal board needs to be convened to purchase this paper at heavily discounted rates. This will force companies to state their loses, take their lumps, and clear their balance sheets. Next the regulations on home loans need to be restored; Republicans in Congress royally ****ed us all by willfully eliminating needed anti-speculation regulations and this error needs to be restored to prevent yet another bubble.

Lastly, as a condition of getting a federal bail out banks are going to have to agree to write down debt on massively deflated home prices. There is no reason banks should get free money without sharing that money with borrowers. If they want the cash then they have to write down loan balances to reflect current market prices. This will lower payments and prevent home owners losing their houses at ever higher rates. We say 700,000 foreclosures in 2007 and NPR is saying we can expect 1-2 million in 2008; that's the highest level since the 1930's and we have to accept partial responsibility & help find a solution since wreckless Republican deregulation absolutely made this crisis possible.

[DinoDoc]

This is what I don't understand. Why shouldn't stupid people loose thier homes?

[Dinner]

Because then banks go out of business and then the economy does a Japan 1989. If the banks don't go out of business then lending still goes into a nose dive and the economy still does a Japan 1989. Clear?

[DinoDoc]

If that is true, I find it sad that stupid people willingly getting into obviously bad loans can hold the nation hostage to pay for thier mistakes.

[Dinner]

And that banks willingly made bad loans and even lobbied Congress to remove regulations designed to prevent such speculation.

The fact remains though. Japan 1989 or do we do something?

[DinoDoc]

I have little sympathy for anyone involved in an ARM. Both parties deserve all the scorn that can be heaped upon them. I'd go for the bare minimum of a bail out holding my nose only if necessary.

[Dinner]

Feel free. Now the choice is do something or enjoy a decade of stagnation punctuated by periodic recession. Remember that next time Republicans wrecklessly want to remove needed regulations.

[Imran Siddiqui]

Originally posted by DinoDoc
I have little sympathy for anyone involved in an ARM. Both parties deserve all the scorn that can be heaped upon them.

Problem is what about the rest of us that did nothing wrong? We'll get taken down along with the bastards. I wouldn't mind doing some minor bank bailout with drastically increased regulation as the payment.

[DinoDoc]

I'd need a shower afterwards but I'd be OK with that. I'd still like to kick the dead beats out of thier homes though. Just to punish all parties.

[Bkeela]

So where is DanS? Don't tell me he's jumped out of his Wall Street office window already?

[LordShiva]

Originally posted by DinoDoc
If that is true, I find it sad that stupid people willingly getting into obviously bad loans can hold the nation hostage to pay for thier mistakes.

I, for one, am pissed off.