Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

$700 Billion Bailout Signed Into Law

kdawson posted more than 5 years ago | from the how-4-pages-becomes-400 dept.

The Almighty Buck 857

Many readers reminded us of what no-one can have failed to hear: that the Congress passed and the President signed a $700B bailout bill in an attempt to avert the meltdown of the US economy. The bill allocates $700 billion to the Treasury Department for the purchase of so-called "toxic assets" that have been weighing down Wall Street balance sheets. This isn't particularly a tech story, though tech will be affected as will virtually all parts of the economy, and not just in the US. Among the $110B in so-called pork added to the bill to sway reluctant legislators are extensions of popular tax benefits for business R&D and alternative energy, relief for the growing pool of people subject to the alternative minimum tax, and a provision raising the FDIC's ceiling of guaranteed deposits to $250,000. Some limits were also imposed on executive compensation, though it's unclear whether they will be effective.

cancel ×


Sorry! There are no comments related to the filter you selected.

IT Impact, M$ Failure. (1, Troll)

right handed (1310633) | more than 5 years ago | (#25257089)

M$ is already blaming the credit crunch for it's poor performance and hiring freeze [] as if the last 10 years of poor quality software had nothing to do with it.

Re:IT Impact, M$ Failure. (0, Redundant)

Anonymous Coward | more than 5 years ago | (#25257143)

STFU, Twitter.

first post (2, Insightful)

speedlaw (878924) | more than 5 years ago | (#25257093)

The greatest scam ever pulled off...and everyone thought Bush was done !

More of the same but it's going to nail them. (0, Troll)

myCopyWrong (1310641) | more than 5 years ago | (#25257161)

Everyone get's one last bonus check before the economy really tanks. Steve Ballmer is happy about it [] as are most fat cats. Surprisingly, the thing was mostly passed by democrats. Only the fattest of cats will be able to weather the next ten years of melt down, so they need a really big bonus check. M$ is going to fail for sure.

Oh, the first post not yours. Enjoy.

Friday (5, Interesting)

characterZer0 (138196) | more than 5 years ago | (#25257099)

Why is it that really bad legislation always seems to pass on a Friday?

Re:Friday (2, Interesting)

WK2 (1072560) | more than 5 years ago | (#25257129)

According to one of the bosses in "Office Space," they try to fire people on a Friday, so that they have the weekend to cool off, in case they were thinking of coming into work the next day with a machine gun.

Maybe it's kind of like that? Maybe they pass unpopular bills on a Friday so that angry protesters have the weekend to cool off before coming into Congress with a machine gun?

Re:Friday (3, Insightful)

jonbryce (703250) | more than 5 years ago | (#25257293)

On the other hand, they have the whole weekend off to plan for it.

Re:Friday (2, Funny)

Anonymous Coward | more than 5 years ago | (#25257525)

Without a job they pretty much have all the time they need to plan for it.

Re:Friday (0)

Anonymous Coward | more than 5 years ago | (#25257193)

Because a lot of newspapers weren't published at the weekends so politicians tried to hide unpopular stuff by burying it and hoping nobody would notice.

Its been 30 years since that was the case but politicians are living so far in the past that they probably dont understand technological advances have changed things.

Print news is dead, TV news is dead. The days when news was restricted to certain days or certain hours of the day are over.

When people want news now they will go and find it instead of waiting to be spoon-fed by people who cant be trusted any more.

Re:Friday (4, Insightful)

Silicon Jedi (878120) | more than 5 years ago | (#25257209)

Luckily for the politicians, most people don't want news and just ignore the news.

Re:Friday (3, Interesting)

owlnation (858981) | more than 5 years ago | (#25257215)

I assume you know this, but bad news is always deliberately released on a Friday if possible. The media doesn't work full shifts at the weekends, and most people don't sit down to a nightly news program or newspaper. Most in positions of power in Government / Business know that by Monday morning any bad news will have passed largely unnoticed.

Which ultimately is a sad reflection on the media and Joe Sixpack, rather than on the Government.

Biggest Con Ever (5, Interesting)

bigtallmofo (695287) | more than 5 years ago | (#25257103)

Henry Paulson, the CEO of Goldman Sachs until 2006 and current U.S. Treasury Secretary succeeded in scaring the public and Congress into giving him a $700B blank check to bail out his friends. If you think that money will "trickle down" to you or small business owners, or anyone other than the people it's directly going to, you are mistaken.

The DOW plummeted to 10,365 on Monday September 29th when the bailout bill failed to pass. Every proponent of the bailout screamed, "I told you so!" Then on Tuesday September 30th, even without the bailout bill the DOW rocketed up to 10,850. Then on Friday October 3rd when the bailout bill passed and was signed into law, the DOW dropped yet again to 10,325 (even lower than Monday when the bailout bill failed).

This bill will not help the credit markets, the debt markets, the equity markets or anyone reading this comment. It will help Goldman Sachs, Morgan Stanley and the rest of the former investment banks de-leverage from 60:1 leverage down to traditional 12:1 leverage on your dime while the economy goes down the tubes.

They pulled out all the steps - even threatening martial law: []

...and our Congresspeople fell for it.

Re:Biggest Con Ever (-1, Troll)

jo42 (227475) | more than 5 years ago | (#25257151)

Bushtards, every single one of them.

Re:Biggest Con Ever (0)

Anonymous Coward | more than 5 years ago | (#25257217)

I find this statement unfathomably ironic in the light that the majority of Republicans voted against it while the majority of Democrats voted for it.

Re:Biggest Con Ever (0, Troll)

Anonymous Coward | more than 5 years ago | (#25257255)

Bush may have signed the law, but the Democrats voted to pass it. It failed to pass the first time because so many Republicans voted against it.

Re:Biggest Con Ever (5, Insightful)

InvisblePinkUnicorn (1126837) | more than 5 years ago | (#25257261)

"Bushtards, every single one of them."

They're not dumb, they're just evil. They have learned that they can get away with anything, and we'll allow it. No interest in principles, no interest in truth. This is the product of modern political and social pragmatism - a free-for-all, every man for himself. Lie, cheat, steal, whatever it takes to maintain your grasp on the teat of the American public tax pool. The alternative is to make it on your own, using your rational mind to survive and fulfill your goals; but, reason is outdated, obsolete.

Re:Biggest Con Ever (2, Interesting)

hey! (33014) | more than 5 years ago | (#25257221)

Did you even read a summary of the bill, or are you just handing on opinions?

Oh I get it. (1, Interesting)

bigtallmofo (695287) | more than 5 years ago | (#25257265)

Did you even read a summary of the bill, or are you just handing on opinions?

I'm against the bailout bill, so I must be some kind of Anti-Bush partisan hack. Fooled you! I'm a registered Republican and made the mistake of voting for Bush once.

Oh, in that case I must be some kind of member of the unwashed masses voter and just don't understand fancy economic matters. Oops - fooled you again! I'm a Vice President at a fairly large publicly traded bank and deal with investment strategies all day every day.

As for reading the bill - I actually read the entire 3 pages of the original bill. I read about half of the pork-laden 442 page version that ultimately passed. I couldn't read much more or I might be even more infuriated than I am now.

Having said all this, I doubt you read even the title of the bill if you are seriously for it.

Re:Oh I get it. (1)

iminplaya (723125) | more than 5 years ago | (#25257431)

Having said all this, I doubt you read even the title of the bill if you are seriously for it.

I did. It's called the "Paul Wellstone Mental Health and Addiction Equity Act of 2007" Who can be against that? :-/

Re:Oh I get it. (4, Informative)

savuporo (658486) | more than 5 years ago | (#25257467)

Youre a vice president in a bank ? Heres another recent comment [] by you:

I'm sorry, I don't think we've met. Yes, I don't like Vista. But it's not a religious stance against Microsoft. In fact, I hold 4 Microsoft certifications (MCSE, MCSD VB6, MCSD C#.Net, MCDBA) and work on Microsoft products all day every day. In fact, I did a 6 month contract programming job for Microsoft themselves as a side job.

Certainly a very busy man.

Re:Oh I get it. (2, Informative)

hax4bux (209237) | more than 5 years ago | (#25257529)

Hahaha... I have worked for banks, perhaps even the same bank - and I can assure you that almost EVERYBODY is a "vice president". In fact, if your are note a "senior vp" or a "executive vp" or a "super duper vp" than I guess you are just the "entry level vp".

Re:Biggest Con Ever (1)

jsepeta (412566) | more than 5 years ago | (#25257241)

trickle down didn't work under reagan, and ghw bush called it "voodoo economics". it still has the power to stick a pin in the middle class' heart and deal serious pain.

bullshitters like mccain who have too many houses to remember them all aren't going to be hurt by this. only the little guys who are scraping by, trying to get out of pissing rent money down the toilet -- we're the ones who won't be able to get loans now due to the greed and arrogance of the wealthy pricks who foisted this "disaster" upon our once-great nation.

Re:Biggest Con Ever (0)

Anonymous Coward | more than 5 years ago | (#25257473)

trickle down didn't work under reagan

Says the guy who was too young to remember the Carter administration, typing on his 3-gigaflop computer

Re:Biggest Con Ever (0)

Anonymous Coward | more than 5 years ago | (#25257299)

The Dow != the credit markets. The DJIA only describes what investors think they will be earning in the near future. It doesn't describe whether banks refuse to lend to each other or clients. It isn't proportional to the GNP. And it doesn't give any forecast over the long term issues with the economy. The bailout will help free the credit markets but the Dow will continue to drop (probably to around 7500) due to the many factors that are causing this recession.

It happens every year (5, Insightful)

copponex (13876) | more than 5 years ago | (#25257303)

Between 1 and 1.3 trillion dollars has been spent on military projects and war for the last few years, depending on how you look at old debt. The money is not clearly accounted for, against constitutional principles, and it only goes to serve large corporations.

Where is the public outcry? Where are the Republican talking heads when the budget is being discussed?

The bailout plan may be awful, but it's by no means the biggest con ever. The biggest con ever has been going on since the end of WWII, and it has cost American money and lives, and in no small number. Any of these transparently partisan personalities are just squawking for advertising dollars and votes, same as always.

Re:Biggest Con Ever (0)

Anonymous Coward | more than 5 years ago | (#25257391)

If you think that money will "trickle down" to you or small business owners, or anyone other than the people it's directly going to, you are mistaken.

So what the hell are they planning on doing with the money then, burning it? I'm no fan of trickle-down economics, but that's because it's unjust, not because it doesn't happen.

Re:Biggest Con Ever (0)

Anonymous Coward | more than 5 years ago | (#25257403)

Christ on a crutch. Right about now, assasinating Investment Bankers should become a social obligation.

Re:Biggest Con Ever (2, Interesting)

Anonymous Coward | more than 5 years ago | (#25257407)

(I'm and IT worker at a very well-know bank)

I've heard two rumors. The first is that the investment banks threatened congress with an engineered financial crash if they didn't pass this. That is, wall street told them they would rip the guts out of the middle class first... intentionally taking 401ks and IRAs even worse than they have already.

The second rumor I heard was far scarier. It was that China is now pulling what we did to england back in the 50s over the suez canal. Back then, we owned all of england's debt and threatened to destabilize the pound if they didn't let egypt have the suez canal. They pulled out the next day. Today, the shoe is on the other foot. And china threatened to destroy the dollar if we didn't buy back all the fraudulent mortgage backed securities from them. This is the reason for the wording that allows foreign banks to get US taxpayer dollars, that is, we're bailing out foreign banks also.

I'm not sure if either is true. The truth is probably a combination of the two. Either way, we're screwed. We're watching the american version of the fall of the roman empire, or the collapse of the soviet union. Long therm, it's probably good for the country to get off the debt addiction. But short term, it's going to be bad whether we passed this bill or not.

Same FUD strategy than in Irak (0, Troll) (653730) | more than 5 years ago | (#25257425)

Well, people should not be surprised. It's not the first time Bush proposes a plan and uses FUD to approve it. It's exactly the same thing he did in Irak.

In 2003 the excuse was that Irak had MDW and had helped to plan the 11S. This time the excuse was "If you don't pass it we'll have financial panic".

It's the same Fear Strategy. And just like in Irak, everybody believes it and Democrats, with Obama leading (after all, this proves what he has been saying about too-free market being evil, doesn't it?), help him to pass it. This time even Europe, who is also very very happy to hear bush admit that capitalism is evil, supports Bush.

Re:Biggest Con Ever (1)

AdamPee (1243018) | more than 5 years ago | (#25257433)

And OJ Simpson's the one who just got convicted of armed robbery.

Re:Biggest Con Ever (1)

zappepcs (820751) | more than 5 years ago | (#25257441)

Well, if anything of what I've seen in the last 48 hours actually picks up speed, those will be EX-congresspeople soon enough.

I'm looking forward to helping slashdot congressional and senatorial websites. I'm already looking for software/website code to help with that. Not that hundreds of other people don't already have this type of code in place. I just want to make sure that future slashdottings make the news with the same fury as this bail-out bill did.

Yes, the American people have been robbed, and reports that there will be or are investigations into threats of marshal law might help bring that money back to the coffers... who knows for certain.

Re:Biggest Con Ever (1)

nomadic (141991) | more than 5 years ago | (#25257531)

Henry Paulson, the CEO of Goldman Sachs until 2006 and current U.S. Treasury Secretary succeeded in scaring the public and Congress into giving him a $700B blank check to bail out his friends. If you think that money will "trickle down" to you or small business owners, or anyone other than the people it's directly going to, you are mistaken.

Paulson is in office for another 3 months. He doesn't even have time to bail out his friends.

Sweet? (5, Funny)

Entropy98 (1340659) | more than 5 years ago | (#25257107)

How big of a check should I expect to get?
  Blackshot []

Re:Sweet? (5, Interesting)

igny (716218) | more than 5 years ago | (#25257183)

Scumbags managed to lose lots of their money, now they can rejoice for they now can lose your money. If you are an american taxpayer, your participation means that you are down roughly $5k.

Re:Sweet? (1)

ahodgson (74077) | more than 5 years ago | (#25257211)

Are you a Friend of Hank? If not, I'd say nothing. In fact, you, or more likely your children or grandchildren, will get a hefty bill instead.

Re:Sweet? (1)

Jimmy King (828214) | more than 5 years ago | (#25257285)

I'll give you an estimate as soon as the check which covers the extra I had to pay for my house due to inflated housing costs due to the artificially low interest rates shows up.

bailout / rescue (0)

quixote9 (999874) | more than 5 years ago | (#25257121)

When the lifeboat is holed, you get to shore FIRST. Then you worry about who to blame for the hole. Or, we could have all worried three years ago, when it would have done some good. Carping right now, when the boat is sinking, is just plain stupid.

I know you're scared, but please think. (5, Insightful)

bigtallmofo (695287) | more than 5 years ago | (#25257169)

Carping right now, when the boat is sinking, is just plain stupid

You know it's an amazing coincidence. You're saying the exact same thing that Henry Paulson and his cronies say. I'm sure that it is just that - a coincidence - and that you independently came up with the identical position completely on your own.

I also suppose that if Henry Paulson said you needed to come to his house and blow him or the economy would go under you'd think, "No time to think!" and head right over to do it. If that's not the case, then why did you fall for his, "Sure, I'll give you a life preserver - throw me your wallet first!" scheme? There is time to think. Henry Paulson has said he has no plans to spend any of the $700B for FOUR WEEKS. Why the rush to pass it into within days?

Re:bailout / rescue (1)

InvisblePinkUnicorn (1126837) | more than 5 years ago | (#25257173)

Err... that assumes that the shore is actually a shore, and not just an floating piece of melting ice, which is what we got with the bailout on Friday. It cannot work, companies do not learn from their mistakes when the government is constantly willing to save their asses, and worst of all, we're all stuck with the bill. Have you written your $4,000 check to the government for this bailout yet?

Re:bailout / rescue (2, Interesting)

iminplaya (723125) | more than 5 years ago | (#25257191)

Only this lifeboat had no "women and children" in it. This was no lifeboat. It's a helicopter to rescue the captain after he ran the tanker into an iceberg.

Re:bailout / rescue (1)

pbhj (607776) | more than 5 years ago | (#25257239)

If the guys responsible for the hole are sat there with their power drill taking money from the sharks to sink the ship ... then perhaps you need to address the problem before you get to shore. It doesn't matter how much more money you pay people with hand-drills not to take it from the sharks ... you need to stop up the holes.

Oh where's bad-analogy-guy I think I have a present for him ....

Re:bailout / rescue (4, Insightful)

wizardforce (1005805) | more than 5 years ago | (#25257269)

generally you save the women and children first rather than the idiot with a shotgun that blew a hole in your lifeboat in the first place.

Re:bailout / rescue (4, Interesting)

erroneus (253617) | more than 5 years ago | (#25257367)

You need some serious perspective change.

Let me ask you this:

If you were to ask for, let's say a $10,000 loan with no plan on how to use it, would you expect to get the loan?

These people stated in no uncertain terms that they had no plan in dealing with the problem. The "problem" has been discussed and investigated for months... even years if you want to go back that far. "Experts" have been claiming everything is fine. And now these same "experts" want control of $700 billion and put the US tax payers on the hook for it. And they have NO PLAN on how to go about making things right and no plan on how to prevent it from happening again. NO PLAN.

Which should come first? The money or the plan?

The "panic" is unjustified. Banks have failed. We call that Darwinism. Let it be. Other institutions are restricting their lending practices... adding a little more sanity to their risk calculations. That is a good thing and what they should have been doing all this time! People seem to think this is a sign of the apocalypse. It's not. We should expect some trouble before things turn around again.

But if one thing can be clearly said about this is that these "experts" have caused this problem. These same "experts" claim they need $700 billion to fix it and they don't have a plan.

If this sounds eerily like the story of an addicted gambler, you'd be right to see it that way.

Re:bailout / rescue (4, Insightful)

hey! (33014) | more than 5 years ago | (#25257413)

First of all, I hate this kind of argument by analogy, although the analogy happens in this case to point in the right direction.

Secondly, not all "carping" is bad. We should be skeptical. This isn't the first time we've heard "wolf" called by this administration.

What is going on is that credit markets are breaking down. Credit hasn't "dried up". It doesn't work that way. Credit can't disappear, any more than the world can run out of oil. What happens to these commodities is that they become too expensive to be useful. That's what is happening now to credit, and upshot is that the Fed is losing control of the money supply, and that is very, very bad because controlling the money supply is the main way we have avoided having economic downturns spiral out of control ever since the Great Depression.

It is a very serious situation, and we need to start fixing it fast, but in any case the fix doesn't have to be accomplished overnight. It can't be. We have a situation that grows graver every day, but not say grave that at bad move today is better than a mediocre one tomorrow. It's all about balancing less than perfect action against diminishing returns.

I think there are better ideas out there than this bill, but getting enough support to put them into action runs up against diminishing returns. On the other hand, the bill sent to us last week was dangerous.

"Carping" improved the TARP component of the bill considerably, putting in place a mechanism by which distressed assets are secured by stock warrants to control taxpayer risk, aligning taxpayer and shareholder interests. I originally though the CEO payout provisions were Democratic red meat, but in this context it is good for shareholders too because it keeps CEOs from stabbing the shareholders and taxpayers alike in the back.

So "carping" got us a much better bill than we had a week ago last Friday. The pork incentives to get those last dozen votes, frankly, sucks, but as Barney Frank pointed out: if you don't want politics in this process, you shouldn't hand it over to 535 politicians.

Re:bailout / rescue (1)

Timothy Brownawell (627747) | more than 5 years ago | (#25257499)

and upshot is that the Fed is losing control of the money supply, and that is very, very bad because controlling the money supply is the main way we have avoided having economic downturns spiral out of control ever since the Great Depression.

Depending on who you ask, we just delayed the downturns instead of really avoiding them, and now they're all stacked up and falling over on us.

Re:bailout / rescue (1)

thePowerOfGrayskull (905905) | more than 5 years ago | (#25257511)

So - maybe I'm missing something - under what theory of economics is creating 700bn out of thin air going to "fix" anything at all? Or do any good except to lower the value of the dollar even further?

Free market (5, Insightful)

Anonymous Coward | more than 5 years ago | (#25257123)

The major effect of this bill is that it is causing fiscal conservatives to blow gaskets. They can't accept the fact that the free market is what caused this mess.

It is funny to hear them complain about how people on Wall Street became "greedy." I'm not a financial expert but I think that is part of the design. Everyone on Wall Street works for their own self interest. That is how the invisible hand is supposed to work. But conservatives complaining about the essential 'feature' of the free market is sort of twisted.

Re:Free market (3, Insightful)

Anonymous Coward | more than 5 years ago | (#25257395)

Wrong. If it was a free market, banks would look at an individual's credit history, income, house location, etc, and approve or deny a loan based on whether it was a financially sound decision. Congress stepped in and told them to loan to people with poor credit history. In a free market, Fannie Mae and Freddy Mac wouldn't have had implicit (now explicit) government backing. Had they been free of government support, they wouldn't have been able to deal with such a large quantity of shit loans.

I haven't heard anyone complaining about wall street greed except for the class-warfare liberals.

Re:Free market (1, Insightful)

Anonymous Coward | more than 5 years ago | (#25257435)

Wrong. In a free market, mortgage banks could choose which credit agency they wanted to give them a credit ranking on their securities. If the ranking was low they could then choose another credit agency that wanted their business more and would give a higher ranking. Yep, this occurred. The loans weren't given out because the government mandated it. They were given out because the mortgage banks could package crappy subprime loans into a CDO that the credit agencies would rank as AAA. The federal fair housing laws had no effect. It was the mortgage banks themselves that chose to make the bad loans knowing that they could sell them off on the stock market and not have to worry about them. Nothing, not even the federal fair housing laws, forced them to make so many bad loans.

You're the weakest link, Goodbye! (5, Interesting)

Ostracus (1354233) | more than 5 years ago | (#25257137)

I seem to remember reading the BBC and noting that countries overseas wanted this bill as much as some in the US.

Re:You're the weakest link, Goodbye! (0)

Anonymous Coward | more than 5 years ago | (#25257319)

> I seem to remember reading the BBC and noting that countries overseas wanted this bill as much as some in the US.

Uh, why should they not want it? They have nothing at all to lose when the US throws money around/away (does not cost them anything) and with that amount of money are almost certain to get a chunk of it some way or another. If as an US citizen in this case you listen to foreigners you really are stupid.
Just FYI I am not from the US and since I do not have to "pay the bill" I am not entirely against it, I can only win after all - even though I think it is an immoral and hypocritical (with all those "free market" big-mouths in the US) way to "solve" it.

Re:You're the weakest link, Goodbye! (1)

jonbryce (703250) | more than 5 years ago | (#25257327)

Do you think we are going to object to our banks being bailed out with your money? Of course not.

Re:You're the weakest link, Goodbye! (1)

Ostracus (1354233) | more than 5 years ago | (#25257457)

Ummm. If memory serves. Great Britain had to bail out some of their banks. So at least for some it isn't OUR money.

Ridiculous (5, Interesting)

InvisblePinkUnicorn (1126837) | more than 5 years ago | (#25257145)

First, let's understand what caused this crisis. Then you'll understand why the bailout won't work.

Economist: Why Bankruptcy is better than bailout []

The Trillion-Dollar Bank Shakedown That Bodes Ill for Cities [] ( written EIGHT YEARS before this crisis, predicting everything down to the dollar amount)

Now, check out the $150 Billion in pork-barrel projects that were added by the Senate to the original 100-page bailout that failed in the House, turning it into a 450-page bailout:

- "Wooden arrows designed for use by children" (Sec 503)
- Wool Research (Sec. 325)
- Film and Television Productions (Sec. 502)
- Litigants in the 1989 Exxon-Valdez oil spill (Sec. 504)
- Virgin Island and Puerto Rican Rum (Section 308)
- American Samoa (Sec. 309)
- Mine Rescue Teams (Sec. 310)
- Mine Safety Equipment (Sec. 311)
- Domestic Production Activities in Puerto Rico (Sec. 312)
- Indian Tribes (Sec. 314, 315)
- Railroads (Sec. 316)
- Auto Racing Tracks (317)
- District of Columbia (Sec. 322)

This is the bill that senators are screaming about, saying "IT MUST BE PASSED OR DOOMSDAY!" Who believes them? And yet the bill easily breezed through Congress.

Re:Ridiculous (5, Interesting)

globaljustin (574257) | more than 5 years ago | (#25257449)

Good links, here's the deal...

The US has a mixed economy. Our currency is based on a perception of value (no more gold standard). We like for a market to be as unregulated as possible, but for any number of reasons sectors of the economy will have regulations (from health codes, to OSHA, to Sarbanes/Oxley).

Perception drives our economy just as much as facts and reality. I don't like it, but it's just a flat fact. If people *think* our economy is good, they buy things and make investments. If they *think* it's bad, they don't buy, don't invest, etc... These are the basics, I'm building to a point.

My point is, if we had a respected President, one who could come on TV and calm everyone down, this 'bailout' would be unnecessary. The market would recover. But because the general public has the *perception* that this is "the worst economic crisis since the depression" then something had to be done.

I don't like what they did, but I agree they had to do something. I would have liked for it to be better, but it's not.

Yes, there is obviously problems in the housing market and banking system right now, but (all suffering aside) it's just the market leveling itself out. Housing prices were inflated...they were going to come down. People took on loans they couldn't pay...they were bound to get foreclosed.

In a perfect world, we could let AIG, etc. fail, give some emergecy economic help to people who lost their homes, and wait for the market to recover, but because of how *perception* plays a part in our economy, this "bailout"...though in theory the wrong move, in practice was needed...almost like a commercial for how good our economy will be...

I hate that this is how it works (and I know I'm oversimplifying), but it's true.

Re:Ridiculous (1)

mikael (484) | more than 5 years ago | (#25257465)

I am not sure I really understand the two paragraphs in the second article (trillion dollar bailout).

This investment policy misunderstands what is good for cities and for the poor. Cities that are alive are cities in flux, with neighborhoods rising and falling, as tastes and economies change. This ceaseless flux is a process, as Jane Jacobs brilliantly described it in The Economy of Cities, that fuels investment, creates jobs, and sparks innovative adaptation of older buildings to new purposes. Those of modest means benefit both from the new jobs and from being able to rent or purchase homes in once-expensive neighborhoods that take on new roles. The idea that it is necessary to flash-freeze certain neighborhoods and set them aside for the poor threatens to disrupt urban vitality and the renewal that comes from the individual plans and efforts of a city's people.

So it is OK for a neighborhood to decline, because that creates cheap property that can be regenerated. And a neighborhood will decline because wealthy people move out to somewhere more upmarket.

But keeping these neighborhoods forever poor is the CRA vision. CRA will help virtually any lower-income family that can come close to affording a mortgage payment to purchase a home, often in a non-poor neighborhood.

There goes the neighborhood.

Thanks to CRA-driven bank investment, poor neighborhoods would then fill up with subsidized rental complexes, presumably for those poor families who can't earn enough even to get a subsidized, easy credit mortgage.

So by allowing one group of people to move into home-ownership and escape from renter's hell, we are actually creating sink-estates elsewhere?

The effects of all this could be to undermine lower-middle-class neighborhoods by introducing families not prepared for home ownership into them and to leave behind poor neighborhoods in which low-income apartments, filled with the worst-off and least competent, stand alone--hardly a recipe for renewal.

There goes the neighborhood again. Shame on the CRA for helping people from escaping renter's hell. Thatcherism demonstrated that when people take a financial stake in their own property, they take care of it. Otherwise, they just allow it to fall into disrepair. In the worst case, you ended up with Rachmannism.

stop paying taxes (0)

Anonymous Coward | more than 5 years ago | (#25257157)

All of you, all at once. I have paid zero in income tax through various legitimate and less-than-legitimate methods over the last 4 years.

This bailout is disgusting to both the socialist and the capitalist, and reminds us of what America has become - a fascist state, which takes from the average citizen to give to the mighty.


Sad (0)

Anonymous Coward | more than 5 years ago | (#25257159)

I had a *lot* of respect for the much so that I was ready to leave my home country and move permanently. So that my family and I can have a better life.

This coupled with the ongoing fascist regime, I have decided against moving. And I am not alone...

Re:Sad (0)

Anonymous Coward | more than 5 years ago | (#25257409)

Thank God for that.

Unless gas prices are affected... (4, Insightful)

blackholepcs (773728) | more than 5 years ago | (#25257163)

then I won't notice a thing. I am lower middle class, barely making ends meet. I usually get a refund at tax time, but not much. I've never come anywhere NEAR the FDIC cap in my bank account, and even if my bank went under, big deal. I'd be out less than 200 bucks. But the FDIC would cover it, so no loss. The only thing that the government could do to "bail" me out of rough times would be to:
Lower my income tax
Regulate fuel prices to a reasonable level
Give me free health care
Give me free college just like the African Americans and Latinos and Single Moms and Sudanese and pretty much everyone who isn't a white male/female with no kids
Other than that, big deal. 700 billion dollars that I basically receive no real benefit from, while people who are already rich just get richer. Yay America.

Re:Unless gas prices are affected... (2, Insightful)

ahodgson (74077) | more than 5 years ago | (#25257229)

2/3 of your oil is imported from other countries. How do you imagine the government could regulate your fuel prices to a "reasonable" level?

Re:Unless gas prices are affected... (0)

Anonymous Coward | more than 5 years ago | (#25257305)

setup a puppet government...oh wait that had issues too.

Re:Unless gas prices are affected... (1, Interesting)

Anonymous Coward | more than 5 years ago | (#25257491)

Figure out how much the average driver burns per year. Give say $5000 in tax credits, and jack the price of gas up to compensate. Anyone who drives less makes a profit. Anyone who doesn't pay taxes (illegals, among others) pay more. Everyone wins.

Re:Unless gas prices are affected... (1)

Totenglocke (1291680) | more than 5 years ago | (#25257311)

If they did nothing and the economy completely crumbled leading to the Great Depression Part 2, you'd sure as hell feel it when you lost your job.

I'd also like to point out that "free health care" is NOT free, it's paid for by taxes. The lie of "free" health care is easy enough for anyone who passed the 6th grade to realize, so why are so many American dumb enough to think that the government magically finds money and that the hundreds of billions or even trillions a year needed for "free" health care won't be paid for with tax dollars?

Of course (1)

Renraku (518261) | more than 5 years ago | (#25257179)

There was nothing keeping it from passing. In theory, they could have just tried it again and again with different names and slight rewording until it passed.

Or pasted it onto another bill, something named, "The Protection of Children do want to protect children, don't you?"

Considering how hard this will hit taxpayers, either in pocket book or in services provided by the government going lax, or both which is likely, this should be the tipping point of a revolution.

They made their mess, and they want us to pay for it, without making significant changes to ensure that the mess doesn't happen again. So this time next year when we're having to shell out $700 billion again, who's fault is it? Its ours, for not DOING SOMETHING ABOUT IT.

Re:Of course (1)

InvisblePinkUnicorn (1126837) | more than 5 years ago | (#25257205)

I wrote my Senators and Rep repeatedly. Letters, faxes, emails, and phone calls. My Senators wouldn't listen, but my rep did, and voted No for exactly the right reasons. How about you?

Re:Of course (1)

iminplaya (723125) | more than 5 years ago | (#25257339)

something named, "The Protection of Children Act.."

Close [] ...

Re:Of course (1)

RyuuzakiTetsuya (195424) | more than 5 years ago | (#25257455)

You'd be paying for it ANYWAY when your business or the company you worked for couldn't get short term credit to do day to day business because the banking sector took it's ball and went home.

its not a BAILOUT !!!! (-1)

Dolphinzilla (199489) | more than 5 years ago | (#25257189)

if congress GAVE the money away for nothing it would be a bailout - if they directly paid off the mortgages it would be a bailout - assuming the debt is NOT a bailout because, while the debt may be toxic - it still has VALUE and is thus potentially worth more than the money being printed to pay for it....

Re:its not a BAILOUT !!!! (4, Insightful)

ryants (310088) | more than 5 years ago | (#25257237)

it still has VALUE and is thus potentially worth more than the money being printed to pay for it....

Then let private firms buy it up and make that money... why the panic?

Re:its not a BAILOUT !!!! (4, Insightful)

Eudial (590661) | more than 5 years ago | (#25257343)

it still has VALUE and is thus potentially worth more than the money being printed to pay for it....

Then let private firms buy it up and make that money... why the panic?

Because private firms are under pressure to make money NOW, and always turn a profit. No private enterprise would ever go for this type of long term investment with zero profits in the foreseeable future. Government, however, can wait. It really doesn't matter if it takes ten years for the money to return.

It is in the general interest of the public to resolve these type of situations as fast as possible, because in the end, it's (as usual) Joe Sixpack that's going to suffer if a larger chunk of Wall Street goes belly up.

Re:its not a BAILOUT !!!! (4, Insightful)

NorQue (1000887) | more than 5 years ago | (#25257277)

Great. So, the banks that issued those faulty credits are free now, because someone else (hint: you) pay their debt. The people who took those loans for ridiculously overpriced houses on the other hand still owe that very same amount now to your government instead of banks. If that's not a bailout for banks, I don't know what is.

Re:its not a BAILOUT !!!! (1)

Dolphinzilla (199489) | more than 5 years ago | (#25257401)

so the homes that those mortgages represent while some may be overpriced the majority are worth something and therefore the notes have worth - yes a bunch of phucktards are getting off easy - but I (and many others) am losing far more in investments because of the stock market tanking and would rather the bleeding stop than sit around hoping for some miracle of change to save my retirement funds

So... (1)

Jane Q. Public (1010737) | more than 5 years ago | (#25257463)

you would rather see the rich get richer and the poor lose their homes, and the dollar lose half its value, as long as it doesn't affect YOUR investments??

Some samaritan you are.

It *IS* a BAILOUT !!!! (1)

Jane Q. Public (1010737) | more than 5 years ago | (#25257355)

It would not be a bailout if private interests did it. It is a bailout because it was charged to the taxpayers... who are now victims at both ends of the stick.

This piece of shit is grossly inflationary (because the government DOES NOT HAVE THAT MONEY) and so in effect is going to have to print it, one way or another. Which means the value of the dollar will go even FURTHER down, while our gobernmental debts continues to increase. There is NOTHING economically responsible about this measure.

They could have done many other things. They could have done the Reagan thing and just let it play out its course. Despite all the screaming we have been hearing, the United States would not actually fall as a result. They could have spent that money buying up failing mortgages... that way, people would keep their homes and the financiers would STILL get their money. But no... they decided to give my money, and yours, to rich people who do not need it. Just letting the businesses fail would have been preferable to that.

I could say a lot more, but I won't bother.

I honestly believe that this will go down in history as the worst Presidential administration ever, with the worst (and stupidest) Congress to go along with it.

Paulson's speech (3, Funny)

David Gerard (12369) | more than 5 years ago | (#25257195)

"We owe it all to the bedrock of our economy: the ordinary hard-working taxpayer [] . You resisted the siren call of credit cards, lived within your means to save for a rainy day, never took out an interest-only mortgage, credit score to make Jesus cry. Without taking every penny you saved over the $100,000 guarantee, we'd never have made it. And the best bit is, we know you'll still vote Republican! God bless you all!"

By the way, your house is still worthless. []

Re:Paulson's speech (1)

maxume (22995) | more than 5 years ago | (#25257243)

If you stop posting links, I'll stop clicking on them before I realize who posted them.


Re:Paulson's speech (1)

wizardforce (1005805) | more than 5 years ago | (#25257315)

most of the support for the bill was from democrats, most of the resistance was from republicans...

Re:Paulson's speech (1)

David Gerard (12369) | more than 5 years ago | (#25257497)

Most of the resistance was from people who knew their constituents despised the bill and would have them taken out and shot if they didn't get some local pork in there. Hence version 2 passing.

(The trouble with pork is that securing pork is basically what a local governor, senator or representative's job actually is.)

randoidian lazy-is-fair eliminates responsibility (0)

Anonymous Coward | more than 5 years ago | (#25257207)

it's a no-holds-barred, every-man-for-himself, if you don't get caught, it's all good type of thinking that eliminates responsibility to our fellow humans.

greed, fear & ego are unprecedented evile's primary weapons. those, along with deception & coercion, helps most of us remain (unwittingly?) dependent on its' life0cidal hired goons' agenda. most of yOUR dwindling resources are being squandered on the 'wars', & continuation of the billionerrors stock markup FraUD/pyramid schemes. nobody ever mentions the real long term costs of those debacles in both life & any notion of prosperity for us, or our children, not to mention the abuse of the consciences of those of us who still have one. see you on the other side of it. the lights are coming up all over now. conspiracy theorists are being vindicated. some might choose a tin umbrella to go with their hats. the fairytail is winding down now. let your conscience be yOUR guide. you can be more helpful than you might have imagined. there are still some choices. if they do not suit you, consider the likely results of continuing to follow the corepirate nazi hypenosys story LIEn, whereas anything of relevance is replaced almost instantly with pr ?firm? scriptdead mindphuking propaganda or 'celebrity' trivia 'foam'. meanwhile; don't forget to get a little more oxygen on yOUR brain, & look up in the sky from time to time, starting early in the day. there's lots going on up there.;_ylt=A0wNcyS6yNJIZBoBSxKs0NUE;_ylt=A0wNcxTPdJhILAYAVQms0NUE;_ylt=A0wNcwhhcb5It3EBoy2s0NUE
(talk about cowardlly race fixing/bad theater/fiction?)
(the teaching of hate as a way of 'life' synonymous with failed dictatorships);_ylt=A0wNcwWdfudITHkACAus0NUE

is it time to get real yet? A LOT of energy is being squandered in attempts to keep US in the dark. in the end (give or take a few 1000 years), the creators will prevail (world without end, etc...), as it has always been. the process of gaining yOUR release from the current hostage situation may not be what you might think it is. butt of course, most of US don't know, or care what a precarious/fatal situation we're in. for example; the insidious attempts by the felonious corepirate nazi execrable to block the suns' light, interfering with a requirement (sunlight) for us to stay healthy/alive. it's likely not good for yOUR health/memories 'else they'd be bragging about it? we're intending for the whoreabully deceptive (they'll do ANYTHING for a bit more monIE/power) felons to give up/fail even further, in attempting to control the 'weather', as well as a # of other things/events.

'The current rate of extinction is around 10 to 100 times the usual background level, and has been elevated above the background level since the Pleistocene. The current extinction rate is more rapid than in any other extinction event in earth history, and 50% of species could be extinct by the end of this century. While the role of humans is unclear in the longer-term extinction pattern, it is clear that factors such as deforestation, habitat destruction, hunting, the introduction of non-native species, pollution and climate change have reduced biodiversity profoundly.' (wiki)

consult with/trust in yOUR creators. providing more than enough of everything for everyone (without any distracting/spiritdead personal gain motives), whilst badtolling unprecedented evile, using an unlimited supply of newclear power, since/until forever. see you there?

"If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land."

more proof that democrats are donothing asswipes (1)

jsepeta (412566) | more than 5 years ago | (#25257213)

we all have reason to fear and mistrust the conservative right for 1) deregulating 2) stealing money 3) declaring the system bankrupt and 4) taking even more money on the way out the door.

but what i don't get is how the democrats have been total patsies through this banking "crisis". everyone jumped on the bandwagon, and so quickly. don't they remember that it's president bush who was threatening that we'd better do it, or else? he pulled that same shit with Iraq, so now's the time to make the final grab for cash when he's on his way out the door.

if the democrats had any balls whatsoever, they'd call him on his bluff, propose substantial change, bitch about the greed of the republicans through December 1, then impose a fix once obama is in office. instead they're just a bunch of weak-kneed pussies with no guts to do the right thing -- let wall street crash, teach a lesson to the financial markets, which then will come running to the government BEGGING for regulations.

Re:more proof that democrats are donothing asswipe (1)

maxume (22995) | more than 5 years ago | (#25257345)

There is a small chance that the bill will help to prevent a (further!) deflationary spiral within the housing market.

Sure, housing prices are a fantasy, but so is the value of gold (no really, it is), and in this case, the current fantasy is a lot better for everybody than a fantasy where houses are worth 1/10 as much (people with no equity, like me, would not be hurt directly by housing prices falling, but the economy falling apart around them would be a bit of a bummer).

boring (0)

Anonymous Coward | more than 5 years ago | (#25257225)

We want to read about linux!

Slow down the circulation of money (0)

Anonymous Coward | more than 5 years ago | (#25257247)

if you don't like what's going on with RIAA

Arithmetic (1)

shma (863063) | more than 5 years ago | (#25257275)

Since they had to add 100 billion dollars to the bill to pass it, can we start calling it the 800 billion dollar bailout bill now?

Oh, take a look at the effect the bill had on the stock market. Here's [] the Dow's performance during trading hours on Friday. See if you can guess at what time they passed the bill. They sure are grateful, aren't they?

Re:Arithmetic (1)

maxume (22995) | more than 5 years ago | (#25257365)

Give it a month or two. Then bitch and complain. That way, in the event that things work out better than you expect, you avoided a month or two of bitching and complaining, and if things work out worse than you expect, you will have plenty of energy for bitching and complaining.

One good thing to come out of this bill (1)

antifoidulus (807088) | more than 5 years ago | (#25257297)

is the bicycle commuter tax credit. Finally those if us who don't use tons of oil will pay less towards the war fir oil. Now if only American drivers didn't behave like asshats towards cyclists....

Re:One good thing to come out of this bill (1)

tftp (111690) | more than 5 years ago | (#25257513)

Now if only American drivers didn't behave like asshats towards cyclists...

Now if only cyclists could pedal at 45 mph on major roads and accelerate not worse than a common car, and have always-on headlights as motorcycles do...

Instead we have weirdos cycling at night, in black clothes, with no light, across the road, randomly. Or we have a good cyclist doing his best in right lane, but his best is still not good enough, so drivers in the morning rush hour try to pass him, with each pass being a near-accident.

I personally have nothing against bicycles, as long as they don't create a major obstruction to car traffic. The law gives bicycles the same rights as motorcycles and cars have, but unfortunately it does not give them the same power to smoothly join the traffic at the traffic speed. Even reserved bike lanes are not safe because car drivers are supposed to enter them (or cross them) for right turns. One fact of life is that most city roads are unsafe for bicycles, and I don't know what can fix that aside from totally separate bike paths.

One thing that should emphasised clearly (1, Insightful)

Anonymous Coward | more than 5 years ago | (#25257397)

At the moment, it's a fact that banks are not willing to lend to each other in meaningful amounts.

Proponents of this bill and the majority of others will say that so-called "counterparty risk" is a large part of this - the risk that the bank you lend to effectively falls over unexpectedly the following day, as has happened to a small number. The theory is that a profit of 0.2% per year on the amount lent isn't sufficient to make up for counterparty risk.

Proponents of the bill will claim that this is mostly because of the subprime loans that some/many financial institutions hold. By buying up these mortgage products, you remove them from the banks, thereby reducing the perception of counterparty risk.

What should be emphasised in extremely big letters is that this is NOT A HANDOUT OF $700BN. The government buys the products, and in buying them receives the right to the interest payments of homeowners.

But doesn't a lot of homeowners go bankrupt, you say? Absolutely, which is why the government will not pay 100% of face value. A large 'haircut' will be applied on what the government offers.

Only in the scenario that 100% of homeowners go bankrupt and their homes sell for 0 each will the government lose 100%. If the government haircut is 20%, and the default rate is less than 20%, the government will actually make a profit i.e. receive more than $700bn for what it pays. If 30% defaults then the loss is 10% reduced by income from foreclosure sales.

In addition, the interest rate payments on these loans are substantially higher than on government debt that must be issued to buy them.

Everything about this deal will from now on center around exactly how large the haircut will be. It's thus up in the air whether it will be a _transfer of money_ from the government to banks, it's only guaranteed to be a _transfer of uncertainty_. Headlines saying that it's a giveaway of 700bn taxpayer money are all misleading.

Of course, there's a lot of other issues speaking against it. What's the effect on the debt markets of issuing $700bn? Will this really push down the money market rates? If banks don't get paid enough, will they have to recapitalise, and if so, will they be able to?

But on this specific point, people should be aware that the government gets uncertainty and not neccessarily a loss, and everything here-on out, from the size of government loss/profit, to bank takeup rate, to bank needs to raise capital, to possibly job losses if they can't, depends on the "paid-for" foreclosure rate versus the "actual" foreclosure rate.

The Goldsmiths Latest Move = Bailout (1, Interesting)

geggam (777689) | more than 5 years ago | (#25257439)

Dazzled ? Afraid ?

Fear not they just want everything you are worth.

History on Goldsmiths []

Article pointing out where the goldsmiths have struck again. [] 7

Prepare to lose anything without inherent value. ie gold, food, water, bullets...

Another Option: (5, Interesting)

teknopurge (199509) | more than 5 years ago | (#25257445)

I have had the chance to speak with other business owners and some executives of, let's just say, large, corporations. The general feeling is that while action was necessary there was a much better approach:

- ~500 billion USD given to the Fed
- Allow the Fed to disperse the money through the discount window with loans at 1% fixed for 18 months then reset to Prime-0.5%
- All mortgages that are currently in MBS tranches have their rates reset to Prime+1 for 24 months.
- Have the US AG seek felony charges for lenders that committed fraud.

The current bill is like trying to get fuel into a car through the tailpipe instead of filling up the gas tank.

Read the Bill For Yourself (2, Informative)

camperslo (704715) | more than 5 years ago | (#25257489)

If you want to check out all of details directly it's only 724 KB to get the PDF of HR1424, the full bill [] .

You can find an index to most of the tax break provisions starting around page 261.
Looks like they got the Republican tax agenda in there.

Some may also like to check out the wikipedia entry for HR1424 [] .

This proves how much Americans will sit and take! (5, Insightful)

King_TJ (85913) | more than 5 years ago | (#25257501)

What I find MOST incredible about this whole bailout, is the fact that nationwide polls of the general populace indicated between 70% and 75% were AGAINST the legislation, yet the Senate passed it through with FLYING COLORS, and House of "Representatives" were swayed to voting for it in a matter of only a few days. All it really took was throwing in a few key financial incentives and bonuses to the appropriate special interests, and some empty promises by potential presidents to be.

The whole time, these "Representatives" were being flooded with demands from the American people NOT to vote for the bailout - but they turned a deaf ear to everyone, and made bold claims like "I may not be re-elected because of this, but I'm confident I did the right thing for America's future anyway." One moron said he changed his vote from NO to YES, simply because "I talked with potential president to be, Obama, and he personally assured me he would enact legislation after his election that's in alignment with what I want to see." (WHAT?!? You were VERBALLY promised some B.S. by a guy who MAY or MAY NOT become president, so that's more important to you than listening to the people who elected you and trusted you to represent their wishes?!)

When HUGE taxpayer expenditures like this are voted through and signed into law in less than a week, despite 3 out of 4 Americans being strongly against them - it's clear we no longer live in a Democracy at all! This seems like as good a reason for an overthrow of our government as what we dealt with back around 1776! Yet people will not only sit back and accept it, but probably not even vote in protest for a 3rd. party like the Libertarians. (Incidentally, Bob Barr has been speaking out against this bailout the whole time, unlike our Democratic or Republican contenders. The man gets MY vote for that reason alone. At least he's in support of the will of the PEOPLE still!)

so much for "free market banking" (1)

Ralph Spoilsport (673134) | more than 5 years ago | (#25257505)

I think we're goin

Clinton and Crook Franklin Raines are the cause. (0, Flamebait)

zymano (581466) | more than 5 years ago | (#25257519)

And he's working for Obama. Sickening.

He's the guy that cooked the books and made $100 million off fanniemae options.

Where is the media. Nowhere.

Load More Comments
Slashdot Login

Need an Account?

Forgot your password?

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>