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profits of $1.57 billion for all of 2007....2008 loan losses of $6.4 billion...American Express is likely to receive roughly $3.3 billion of taxpayer funds, and Cap One got $3.6 billion
Cap One executives said their rising losses might imperil a planned acquisition of Chevy Chase Bank. If the acquisition goes forward it might add additional losses from the bank's loan portfolio because Cap One will take on new loans without a strong capital cushion.
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I think there is something gone horribly wrong with this country when we are bailing out loan sharks.
I used to work for a company that used a multiplexer made by a Middle Eastern supplier. They made the hardware and the software that ran on the machine. As they changed the software, they would send us the new version for regression testing. At first, we found piddly little things wrong. As testing progressed and newer versions came out, we noted more and more greivous errors. In fact, we found some that were a "full stop" on insertion into the network...such as trying to connect channel 14 of a T-1 to channel 3 of an E1 and watching the system take a giant, flying s***.
Needless to say, we brought this to the attention of the people, who apologized profusely and promised to do better. I finally figured it out one day. They didn't do regression testing any more. Since we were so thorough, they let us do it and then they would fix it, once we found all the bugs.
The credit card companies have made tons of money off of people by "universal default" and "raising rates for the hell of it" and "funny ways of computing interest." Now, they need to ask for a bail out? America. Wake the F up. We aren't that stupid are we? Are our congresspeople?
Let's do what I did to that Middle Eastern company. Let's stand up in the briefing on "bugs found in version 2.19" and say "Are you even doing regression testing? You keep sending us worse and worse versions of your software. This has got to stop or we'll just switch vendors. I've had it!" and then walk out of the meeting.
Boy, did I catch hell after that meeting. Someone (on both sides) was getting their back rubbed and I p***ed all in their cornflakes.
According to a book titled "Trillion Dollar Meltdown" (I do not recall the author even if I read the book over the weekend) we already have done the one thing that will cause this collapse to drag out over at least a decade. We bailed out the financial industry at the cost of completely devaluing our currency. The future is likely to bring a situation where prices and economic activity do not increase but actually fall despite how much money the Feds try to create. The Feds simply cannot create money a fast as 150:1 leveraged business deals require.
The entire private world wide financial system became wildly over leveraged and the business at the top created ever more exotic “instruments” to sell their losses to the chumps. It worked until they ran out of chumps. When some tried to sell their losses they found out the market just would not buy any and the sellers had to adsorb the losses. Enough of this happened and everyone became losers.
At this point there is not enough real wealth on the planet to cover these losses and creating more money will only make the situation worse. I do not believe the world has a Reserve Currency with any real value any longer. We are going to be practically back to barter for international trade. We are not headed for stagflation on a domestic level but for a stone cold stop.
I don't know whether a bailout is good or not. If it doesn't happen then those of us who have been responsible with our credit will end up paying even more for those that weren't.
Last edited by North Beach Person; 01-26-2009 at 12:13 PM..
Reason: spelling
I was wondering why instead of a bailout, the government simply paid off credit cards in arrears and then take that amount out of their taxes for X amount of years. Then the companies have operating money, people are out from under massive debt and can pay their mortgages instead, and the rest of us aren't stuck paying a debt we didn't accrue.
No bailout is good for the economy. It is basically trying to prop up a failing company. The company is failing because consumers are saying, "Your product is too expensive for the value it provides so I am not buying it." Free market is what creates the best economy.
An economy wherin companies are "bailed out" of failure works worse than one where the speculators are allowed to go broke. If there is any sector of our economy that needs "bailing out" it is the first time single house homeowners that were sold the usurious adjustable loans. The property should be siezed from the banks by the government and resold at current value to the current owners using a fixed rate 30 yr government mortgage. This should be strictly limited to a single house. Multi house home owners would be left on the hook for their speculative investments.
No..it has to end right here right now...look at the plane that was bought by Citi...look at the rest of the money that has goen down the gutter....people should be held responsible, but that is hard with a man who is the head of the Treasury department and his past!
Why bailout the big part of the problem. Credit card companies were falling all over themselves to give people high interest credit cards, in hopes they couldnt make payments. Then raising rates without much 'just cause'. Why would they go back to 'responsible' credit offers if they get a pass from the govt? I dont think we really need another lending agency.
Location: Georgia, on the Florida line, right above Tallahassee
10,471 posts, read 15,865,948 times
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Quote:
Originally Posted by GloryB
I was wondering why instead of a bailout, the government simply paid off credit cards in arrears and then take that amount out of their taxes for X amount of years. Then the companies have operating money, people are out from under massive debt and can pay their mortgages instead, and the rest of us aren't stuck paying a debt we didn't accrue.
I bet the credit card companies would create a "Taken over by government" credit clause that charged an additional $1,000 dollar "transfer fee" and computed "interest in lieu of years we would've stuck it to ya'" to add to the payoff. Why not? They just make this crap up as they go along.
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