In lieu of bailout, what should be done?

I've heard that the bailout is a "bad idea" from what is probably a majority on these boards. I believe this is probably true, but I am not a financial guru... if I were, I'd be rich! But alas, I'm a technical guy and a writer, and global finances are not my forte. I get the gist of it, but reading some of the sites referencing this situation is like reading VCR instructions. In the short time here, I've been pleased to find that that this board has, along with the somewhat conspiracy-first minded folks, a wide array of people with some very interesting and intelligent ideas (which are often from those conspiracy-first minded folks, which I am slowly learning to listen to without being hyper-cynical, flying off the handle with a "omg you cannot be serious" mindset).

With that said, I'm honestly intrigued in what people think should be the plan of action, in lieu of this bailout. I am not very comfortable with the "just let it crash and we'll see what happens" idea. I'd like to think that there is an alternative plan that could be set in motion, that would help alleviate the crisis, without creating another depression or financial hole that our childrn might still be climbing out of for the next decade.

I'm honestly baffled that our supposed savvy economic minds can't come up with something better. If Bush doesn't decide to cram this thing down everyone's throats, what would you rather see in place?

My idea would be to let the markets correct themselves. To help them out though, I would drastically reduce or temporarily suspend the capital gains tax and the corporate tax to increase the cash flow into the economy. I think if we were to do this, we would see that proposed 700 billion come in quite quickly through increased investments from overseas and at home.

Ironically, this is quite similar to the plan the house republicans proposed in opposition to the bail out bill. That plan was laughed at though. Harry Reid told them that they needed to "get real" and literally laughed at the idea.

***Edit to add a very important part that ohioriver just reminded me of. We must demand the resignations of Frank, Dodd, Paulson, and Bernake. We can't let the same idiots who caused this mess try and fix it. ***

[edit on 30-9-2008 by nyk537]

1. Enforce the regulations we have.
2. Make the financial firms pay into a fund to rescue and/or absorb the failing banks.
3. Fire Paulson.
4. Freeze all foreclosures and force these dirty banks to refinance at 6% interest.
5. Stop sending jobs overseas, cut tax breaks for companies that do.
6. Subsidize electric vehicles. Give huge tax incentives to buy them.

Ohio, and pardon if I seem dense, I'm not trying to be (just not the most savvy on this sort of thing), but if these banks are on the verge of bankruptcy as it is, could they actually afford to refinance at a low interest rate? If current conditions are any indication, one would think that very few banks would be capable of doing this right now. Unless you are suggesting their woes are exaggerated, which I could believe in some cases.

reply to post by fleabit


First thing I would suggest is read a few of these threads, and links.

www.abovetopsecret.com...

www.abovetopsecret.com...

Then go to this link www.fedupusa.com...

and click on find your representative, and let them

know POLITELY to not fall for the FED, and Govt' lies, and to do their job

for WE THE PEOPLE, by looking at alternate plans instead of this con job.

Later,...... Ausable_Bill

[edit on 30-9-2008 by Ausable_Bill]

We need to totally dismantle and rebuild our entire economic system. Lose the fed, go back on a gold standard or something similar which actually backs our cash with something tangible.

Bring our industrial complex back home, and up to the level it should be at.

Restore the work ethic. The masses have been brainwashed into thinking its better to make money off of the stock market then it is to work for it.

Reduce credit. Companies or private citizens should not be using credit just to pay their everyday expenses. That's just living beyond your means any way you cut it, and that's never a good thing. If a company can't afford to pay it's bills and payroll without borrowing, then they're running the business wrong. More profits need to be put back into the business as opposed to the top guy's bonus. If a citizen needs to borrow to eat or pay their bills, they need to reduce their standard of living.

Yes, it will cause lots of chaos getting it done, with recessions/depressions and such. In the long run, though, it will hurt a lot less then if things just keep running as they are.

Good Start:

1. Enforce the regulations we have.
2. Make the financial firms pay into a fund to rescue and/or absorb the failing banks.
3. Fire Paulson.
4. Freeze all foreclosures and force these dirty banks to refinance at 6% interest.
5. Stop sending jobs overseas, cut tax breaks for companies that do.
6. Subsidize electric vehicles. Give huge tax incentives to buy them.


Lastly turn all of those involved in the fraud over to the chinese government for punishment. Which means they will never do it again..

Originally posted by fleabit
Ohio, and pardon if I seem dense, I'm not trying to be (just not the most savvy on this sort of thing), but if these banks are on the verge of bankruptcy as it is, could they actually afford to refinance at a low interest rate? If current conditions are any indication, one would think that very few banks would be capable of doing this right now. Unless you are suggesting their woes are exaggerated, which I could believe in some cases.

Well if you had 6 billion dollars and you got to draw 6% interest on it just think of the profit you would make over time. That would be 36,000,000. A year.

Edit to add more figuring.

Average home price=200,000 x30,000 homeowners=6 billion x 6% interest= 36,000,000 a year
There are over 1,000,000 homeowners in US= Obscene bank profits even at 6%

[edit on 30-9-2008 by ohioriver]

Nothing should be done. Capitalism demands that the stupid fail. The system demands they fail. They offered me a million dollar loan and I make $350 a week. This shows they are fools and must fail, even at the risk of ending all credit for a while. They made the money and now they made it worthless.

Originally posted by nyk537
My idea would be to let the markets correct themselves.

ABSOLUTELY.

They are just screwing with us.

Los Angeles Times

Where’d the $700 Billion figure come from?

Answer - "It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

The single best thing that America could do is to get rid of the federal reserve, it causes most of these bubbles to be created then burst.