Financial UPDATE

[Rassputtin]

The bill was denied, 700 billion dollars will not be given by the government to save the failling economy.

As a result the Dow fell a record breaking 777 points in one day.

The largest single day drop in history.

IN addition, the global economy is suffering as well.

Points finger at whomever was boasting about belgian banks.

Three European governments agreed to a $16.4 billion bailout for Fortis NV, Belgium's largest retail bank,

and the British government said it was nationalizing mortgage lender Bradford & Bingley, which has a $91 billion mortgage and loan portfolio.


Clearly a sign that the crisis is beyond the US borders.

Anyway, this ships taking on water now boys. Good news is the price of gold went up 23 bucks.

[Calvin74]

i am not sure exactly where i stand on this but i don't like the idea of the government buying out companies as it gives the government to much power and the ability to seriously mismanage even more

certain banks are doing alright (those that didn't lend money out to just anyone) and i don't think people that made stupid decisions just because they wanted to own a house that was outside of their range should be bailed out with money from other people that were fiscally responsible


oh and banks all over europe have been having trouble for weeks and since just about every economy is based on the US then yeah this definetly affects everyone

[Xavior]

The bill was denied, 700 billion dollars will not be given by the government to save the failling economy.

As a result the Dow fell a record breaking 777 points in one day.

.

Lets blame this one on the Democrats as well!

[Tnova]

The bill was not to deal with the Failing economy. That is a whole separate issue.

The bill was to buy up debt that couldn't be sold in order to free up banks capitol to issue new debt in order to start making money. And when things settled back down, the debt bought by the government could be sold similar to what happened in the Savings and Loan scandal in the late 80s. I don't believe the proposal was a good idea because 700B is a drop in the bucket of what the problem is, and if they go all in, and it doesn't fix it, well then you will see a crash.

I actually believe that we will start experiencing Deflation and if that turns out to be true, gold (and other commodities) will continue to fall.

But you are correct, this is a global crisis.

[Rassputtin]

The index 5000 - lost paper wise 1 Trillion plus dollars.......... today.

I find it odd, it dropped......

777 points.

[Crimson Shadow]

Lets blame this one on the Democrats as well!

Democratic controlled house, so -Z- you can't blame this one on the republicans.

i am not sure exactly where i stand on this but i don't like the idea of the government buying out companies as it gives the government to much power and the ability to seriously mismanage even more

certain banks are doing alright (those that didn't lend money out to just anyone) and i don't think people that made stupid decisions just because they wanted to own a house that was outside of their range should be bailed out with money from other people that were fiscally responsible


oh and banks all over europe have been having trouble for weeks and since just about every economy is based on the US then yeah this definetly affects everyone

The latest bill dealt strictly with buying out banks, not other companies. If the economy is to recover, I think something like this is needed. Banks right now will NOT give out loans to people who want to buy a boat/RV/etc because it is too high risk, all their money is wrapped up in bank foreclosures. Right now even if someone wanted a luxury item they couldn't buy it because banks won't let them. That is why many companies, especially in my area (RV capital of the world) are going out of business.

Too many people got their mortgage using ARM which starts off at a low interest rate for about 5 years and then jumps up to the current interest rate. The problem with this is, most people's ARM's jumped at the same time, and it just so happened that it is when interest rates were ballooning and their interest payments were almost double. Most Americans can't keep up with that and their houses became foreclosed, putting banks out on average about $190.000 per house. Which leads back to the problem we have today. The bill won't solve all, but providing some relief to banks to give out more loans would definitely be a start.

[Xavior]

Democratic controlled house, so -Z- you can't blame this one on the republicans.

However, way more Republicans voted against the bill than Democrats.

Because the Bill is so unpopular with American citizens, they were afraid to vote for it, since they know that would be damaging to their re-election hopes. You can't blame this just on one party.

[Crimson Shadow]

True, but it doesn't matter how many republicans vote no. The house is democratic and pretty much whatever the democrats want, they will get....unless the bill is vetoed or shot down in Senate.

[Bright]

This is good, bad, and quite amusing when you see the big picture.

Good in that its making the West take a look at things- energy is no longer cheap, and as a collective society (all of our countries), we need to be on the same page with new technology and doing so in a timely manner so we can stop bending over and assuming the position with every little thing that causes oil to go up (hurricanes, pundits on the market/tv, political instability at the sources, the phase of the moon, etc.)

Good also in that people are waking up to a new world where they can't borrow money at will, spend crazily, throw away money, and get bailed out when they can't pay it back.

Look at the suits of these major banks, sure, they may be out jobs, or their banks are falling apart, but I guarantee you that they have a golden parachute severance package that would make any middle class citizen in any country sick to their stomach.

Should this bailout be approved, there needs to be some provision to making these idiots who did predatory lending practices (see NINJA loans) willingly serve time in jail, pay fines, forefeit their severance, or any other appropriate penalty.

The bad comes with young people like myself who haven't yet bought a home, and people looking for loans. Credit markets are frozen, and if you get through the gauntlet, the interest rate is gonna suck. Apartments are looking a tad bit more attractive now. Jobs may drop here in the US as well as other sectors crap out due to the freeze of credit.

To me, I think the US (and possibly global) economy got too big for its britches, and is now contracting to a more stable size. Whether or not the descent is controlled is mostly up to the legislative bodies of various countries (unlike presidents or prime ministers, who people like to place the blame on).


For those who have been ing at amerikkka for the past year or so, the raincloud is starting to creep to your neck of the woods...and then we'll all laugh together in misery.

[Xavior]

Clearly a sign that the crisis is beyond the US borders.

This was long beyond the US borders.

Toronto's main index (TSX) fell 850 points today. Mr Wolfe of Merrill Lynch Canada just said Canada is falling into the same vicious housing cycle that the US did (altho i must disagree on this one), inflation is up, housing prices have stalled.

Yet our PM Harper continues to say that the fundamentals of our economy are doing well. Does this sound familiar?