Updated – Congress Votes Down Bailout Package

Although the fear monger’s would have you believe otherwise, this is positive.

I’m sure the American public don’t want a financial dictator with a blank check.

Especially with no one able to review what is going on by anyone, no judge,

no admin, No one!…….Eh to go congress!

Though i am skeptical, the republicans voted mostly for nay!

I truely belive in the Problem,reaction solution going on behind the veil.

I somehow am trying to not think this may have something to do with swaying voter’s “main street”

on the republican side. hmmm…..

There’s a great youtube video of Dobb’s show on CNN, some interesting facts going on there, regarding campaign contributions from investment banks to the leaders of Congress.

At least the majority said not and that means the cries of many were heard, that is the cries of those who’d be screwed by this bill. Though now you’ll hear Wall Street execs crying they can’t make more millions off of this mess!

http://ca.youtube.com/watch?v=jD_4RIaJcXs

I for one am proud they turned it down, even if it was VERY close, they still turned it down! I have hope that America will change and become once again United!

It is amazing how quickly the finger pointing starts. Seems like many are more concerned with partisan issues rather than what is the right thing to do.
Republicans pissed at the comments by Nancy Pelosi about the Bush administration’s economic failures, so they vote against the bill? It’s bizarre.
Something has to be done to restore faith in the system, and fast. Looking at maybe the largest single day point drop in history of the stock market!

The Republicans voted Nay because of the amount of profiteering outlined in the Bill. ACORN is only one organizations the Dems wanted to benefit out of this bailout. Read the fine print people.

http://www.marketwatch.com/news/story/crl-acorn-still-reap-windfall/story.aspx?guid={EF3547E8-8C23-4CB6-A19A-06C09A8F5BA5}&dist=hppr

Its pretty obvious that the bailout was dead before the vote hit the floor. It was merely a mechanical vote so Pelosi wouldn’t lose cred and her ‘unpatriotic’ comment pretty much alienated the remainder of her backers. Nice going to unite the house floor.

Hopefully, the libs and dems can pull back their inane requests to dole out the spill over. If a recession hits, it might be the best way to correct the Wall Street market. Unfortunately, most news outlets and politicians can’t explain this economic issue because they have no idea themselves. No wonder constiuents are panicky and now the Representatives are worried about THEIR jobs! Unreal

[quote comment="66878"] We’ve had bigger daily losses on the stock market – October 26, 1987, when it fell 8.3% and a 6.9% decline on October 27, 1997 [/quote]

actually this is waaaaay worse…and i quote: “The markets turned highly volatile as it became clear the measure wouldn’t find the necessary support. In the last hour of trading, the Dow was down 709.03, or 6.36 percent, to 10,434.10. At its low, it was down 705.06, not far from its previous record for an intraday drop, 721.56, set during the first trading day after the Sept. 11, 2001, terror attacks. Still, in percentage terms, the decline remained well below the more than 20 percent drops seen on Black Monday of October 1987 and the Depression.”
- taken from a story done by Tim Paradis, AP Business Writer

im glad congress didnt let it pass…george bush can go fuck himself and the mess he helped create

I wish I understood more about this whole situation. But I really never looked at stocks and economics that much. So I always have to plead ignorance on this when I’m asked.

It’s a great time to buy.

i see your point, p. martini, but what does it mean when republicans vote down an idea that almost had their own leader getting down on his knees and begging for it to be passed?

it means theres some serious flaws in the fine print thats gotta be worked out, nein?

what about matts post about defense spending and the part stating “Of course, none of this excuses the behaviour of those untouchable picaroons that played their role in engineering this current crisis. As the New York Times points out this morning, they’re already looking for ways to capitalize on the disasterous product of their own greed…” “Even as policy makers worked on details of a $700 billion dollar bailout of financial industry, Wall Street began to look for ways to profit from it. Financial firms were lobbying to have all manner of troubled investment covered, not just those related to mortgages. At the same time, investment firms were jockeying to oversee all the assets that Treasury plans to take off the books of financial instutions, a role that could earn them hundreds of millions of dollars a year in fees. Nobody wants to be left out of Treasury’s proposal to buy up bad assets of financial institutions.”

Greed on behalf of lenders and borrowers. Period.

quote comment=”66889″] As one of the CNN analists said today (paraphrased) - there’s a big fire burning and it has to be put out. After it’s out, we’ll worry about who started it and why we didn’t have flame-resistant drapes and so on. But first put out the fire.
[/quote]

didnt they say that about 9/11 and Iraq? And look where that got everybody pff.

CNN is not the be all and end all of great journalism; to me they are the equivalent of a politcal tabloid; they have a thing for sensationalizing every fuckin detail until they forget what it was they even started reporting on in the first place; everything on that channel is DIRE and of UTMOST IMPORTANCE and blah blah fuckin blah..might as well rename it OMG for fucks sake.

It’s a great time to buy. As roy often says to me offline - this is just the tip of the ice berg.

Hey Roy, time to move up here and drink from the tit of pot ash.

[quote comment="66901"]
CNN is not the be all and end all of great journalism; to me they are the equivalent of a politcal tabloid; they have a thing for sensationalizing every fuckin detail until they forget what it was they even started reporting on in the first place; everything on that channel is DIRE and of UTMOST IMPORTANCE and blah blah fuckin blah..might as well rename it OMG for fucks sake.[/quote]

Yeah, I definately understand that about CNN - that one thing just made sense to me. I do try to keep my BS filter on high alert while watching.

…rename it OMG…

too f’in funny - sounds like a great idea for a comedy skit - “OMG News - OMG! this just in!….”

Very good video — this guy says the same thing 200 economists say - summarizing and in English!

And he points out what is so obvious that the media misses it, because fear sells
http://ca.youtube.com/user/kdenninger

Remember, 1600 companies need help, with upwards of 10 trillion to fix this if you want to bailout Wall Street.

[quote comment="66894"] I’m not very happy. My bank was just bought and my mortgage company collapsed. My mortgage now may be called. Anybody have an extra $110,000 to loan? Private financing may be all that is left for the next few months. I hope I do not lose my house.[/quote]

So sorry to hear that. I do hope you will be all right, you and anyone else in your situation. I admit complete ignorance in this issue, I don’t like the idea of bailing out the banks but (more) people losing their houses? I don’t know what to do except send positive thoughts out to the world and pray.

[quote comment="66909"]

How can I blame the consumer. Its the banks that let them spend beyond their means. “What do you mean you have no money to put down on a house? Its okay….buy that $450,000 home when your household income is only $75,000. We will give you a fancy smancy brand spankin new INTEREST ONLY loan. Dont worry about 3-5 years from now!!!! It will be A-OK!!!”

[/quote]

So it’s the banks fault that people can’t control themselves and live within their means?

[quote comment="66897"] One thing - Isn’t it correct that the money spent will buy loans and collateral (ie mortgages and homes) which have value? Eventually this will come back to the taxpayers and the true cost will be less (maybe they will even make money in the long run?) than to initial cost of the bailout.[/quote]

It depends. You have to look at what the actual financial instruments are that the government would purchase and then what the government is planning to do with the financial instruments in order to get our money back.

As you know, it is a lot safer for the government to purchase mortgages and other distressed debt which has security attached to it because if the borrower defaults, the government then gets the benefit of the security (e.g., the house). Then, whether we get our money back would depend on what we paid to buy the debts and what the security (e.g., the house) is worth in the market. My concern is that if the market never returns to “normal” or was wildly over-valuing the assets, then we might find that we paid more to buy the debt than the security is worth. I do think that is unlikely to be the case, but it’s still a risk the financial firms are effectively forcing on us as taxpayers.

So, yes, we can get some protection if the government is purchasing mortgages or other debts which have security attached.

There is a potential second problem, though. Some of the instruments the government might be buying might have been only “linked” to mortgages, which means that the government might be purchasing only a “financial position” based on a bunch of mortgages or other debts. In that case, the “financial position” might have an independent value. But, when the government buys the paper, it may turn out to be incredibly high-risk, and, on default by the borrower, it may not allow the government to seize any particular security in that “bunch”. Think of a sausage of mortgages, and then try to pick out the good bits from the bad. I admit, this is the most esoteric element of the problem we are experiencing, and I would be happy if someone with greater expertise could give me some help understanding this. The point, however, is that there is some risk that when a lot of mortgages go bad at once, the good bits in your slice of sausage might not be identifiable form the bad bits, and you might not be able to separate them out without really high costs and confusion.

The third problem I can see is what I alluded to in my previous post. There, I said that you have to do a “work-out” so that people who are defaulting on their mortgages (which we are going to buy) can get their payments down. Here is where I see the problem: If the government doesn’t want to wait until the mortgages are paid off by borrowers, it may want to sell the mortgages (or other debt) into the market before maturity. This is what the banks were doing that got us into this mess. It’s well-known that the banks basically gave mortgages to borrowers and didn’t care whether they could pay them because the banks then sold them on to other banks and investment houses as “rights to payment.” The deficiency of the plan that just got rejected in the House is that if the government wants to sell the mortgages as “rights to payment”, no one is going to buy them (and you’re not going to get your tax money back) if the borrower is in default or is going into default because the payments went from $800 per month to $1400 per month. Unless you change the terms of the contract, the borrower will still be in default and no one is going to buy the paper from the government. That basically will lock the government in to holding the mortgages long-term instead of selling them in two or five years when the market corrects. That means we’re not going to see any money returned to us until the mortgages are paid or we’ve foreclosed on everyone, held the houses until the market corrects and then re-sold them. I’d rather get people in a position to make consistent payments than pay for foreclosure proceedings on all these people and then make a quick exit by selling the paper, rather than taking the assets and tasking the government with maintaining the properties until they are re-sold.

So, yes, we could hold on to the mortgages, take the houses if the borrowers default and sell them back to the market at a profit if the housing market improves. But, if we’re taking an instrument which is little more than a fiction, we might not even get to take the houses when borrowers default. And in any case, as it stands now, if we’re not going to make sure people can actually pay the mortgages, we’re going to be stuck holding on to financial instruments with no market value, leaving the government only the option of foreclosure.

From the Lou Dobbs segment what I found most offencive was the talk of the same proponents of the bailout pushing for tougher bankruptcy laws for the general public… it’s truly time to hang those f***ers high.

[quote comment="66907"]Patrick, it’s only safe to buy if you plan on playing the game, not investing, playing the game! You will need funds to play the game, for every transaction is $10. So you will have to play smart and be constantly watching the market, if you are late, you could lose a lot of money!

Dangerous times, which means for those who want to make money, they can. I am betting that most of the execs on Wall Street are watching VERY carefully, waiting for the first “vote no” sign to buy, then, a vote yes will send stocks soaring, and they’ll sell and make enough money to remain rich and fat until they die.[/quote]

No this is a great time to buy in the long term too for investmenting. I wish i had some money. i wouldn’t buy RIGHT NOW, i would wait at least after a bill passes & for all this to settle down to get into the market. Stocks are low now, they will be low for likely years because of the recession. Buy now, and in 20 years you’ll be laughing to retirement. Its like all those people who bought during the Great Depression. KA-CHING!!

[quote comment="66874"]Bailout the robbed, not thieves. A recession will teach us well…. I can hope.[/quote]

C’mon man, b.s. Dale! People are getting caught up in the ‘principle’ of bailing out these rich & greedy Wall Street fools, and the conservative ‘principle’ of “free market capitalism” and not focusing on the reality of what will happen if they don’t pass that bill.

What happened today was scary. Very scary. Biggest # drop in the DOW in history. If they don’t get a deal done there will be another drop, and over the next few months if AIG falls apart, a few more critical companies hit the crapper, and/or nobody or no businesses are able to get any loans you’re going to see the market hit the crapper circa 1929, not just a recession.

Its not like we’re giving these execs 700 billion dollars and saying “there ya go, have fun!”. The gov’t wants to buy 80% of AIG in order to save it, and the plan is hopefully as the recession turns to better economic times in a few years or several the gov’t can sell back the shares for a profit & recoup most of the taxpayer money, if not turn a profit.

I don’t want to be taught any lesson. I wasn’ responsible for any of this crap. I have zero debt and pay all my bills on time. I don’t care about teaching lessons to bad investors & greedy banks if it means I and everyone else loses many thousands of dollars, our jobs, our cars etc. Just fix the problem now, and then work on laws to prevent this from ever happening again.

This is NOT a time for “lessons” or to stick to our rigid “principles”. This is the real deal. Millions of jobs, businesses, life-savings, and all of our living conditions are at stake if something is not done. Pass a bill, soon.

[quote comment="66928"]
I hope this guy is right. We will know tomorrow. I see a red tsunami of financial devastation will cover the earth in the next 24hrs. The experts in my office see the first 1000 pt down day tomorrow. I sure hope this guy is right and they are wrong. Remember, most Jews will not be working tomorrow and they always seem to be the calmest in a storm. We may miss them.[/quote]

Looks like my experts and I were wrong. Sorry to have created more fear. I got caught up in the emotions of the day. If we keep a level head, this shakeout could be the best thing for America to choose a new path of responsible government. Call me a dreamer.

[quote comment="66891"]It’s a great time to buy.[/quote]
that has been my exact thoughts on this.