Arkansas Blog

Damn....too bad my mortgage was over last November! It would have been neat to see it paid off by Uncle Bush & Company. Oh...what? You mean there is no bailout for us little people? If we FK up we don't get a golden parachute or a government bailout? Where is that in the Bible?

And all the wingnuts screaming that universal health care is a socialist plot.....and a government bailout with our tax money isn't a socialist plot? How's that? We're rewarding people who hate government, who managed to kill government regulation, fudge the rules any way they could to make a billion and now these government hating, no regulation folks are attaching their mouths to the big government tit and getting golden parachutes too? Not socialism? Not lipstick on a pig?

What about grandma who will have to eat dog food now that all her lifelong savings went up in smoke when her Fannie/Freddie/Lehman Brothers investments turned to dust? Where is her government bailout? I don't want a new Depression, but our Federal Government just jumped the shark and we'll get to pay for it. Yes yes Lard....we need 4 more years of Republicans in the White House! God Hates Republicans!

Relax, Max, and remember the Lou Holtz rule: Nothing is as good as it seems and nothing is as bad as it seems. The loans (or federal bailouts) to Bear Stearns, Freddie Mac, Fannie Mae, and AIG may have saved our butts in the long run. Remember back in '79 when the feds guaranteed a billion bucks (big BIG money back then) in loans to Chrysler? Well, Chrysler paid it back, and the Treas. Dept. actually made a profit when it sold the Chrysler stock it got in the process.

Remember the RTC that cranked up in '89 to dispose of the failed S&Ls assets? Turns out it cost us taxpayers a lot less than first feared. It's not likely that we taxpayers are gonna lose the entire $85 billion we've loaned to AIG (and what might have happened had we not?). The entire economy would have to fold before that happened, and the central banks all over the world ain't gonna let that happen. Buy me a drink at the Cantina Laredo bar tonight and I'll tell ya more.

The silver lining of this bailout is that it provides a really strong argument for universal healthcare. Hey, maybe that's the answer. Instead of calling it healthcare, we could call it a bailout of the U.S. medical services consumer community.

Banks ram-rodded a total gutting of personal bankruptcy and then want wholesale industry-wide gov't bankruptcy forgiveness.

WTF?

We need a truly straight-talker which could get a national audience to stand up and make some very basic observations about how irrational and rediculous the gov't is run.

Sort of similar to Bill Cosby stating the obvious about minorities perpetuating their plight.

Someone similar to the Pope that would get coverage anytime they have a press release.

"Remember the RTC that cranked up in '89 to dispose of the failed S&Ls assets? Turns out it cost us taxpayers a lot less than first feared." Durangokid

One difference between the assets of the S&L's and the "assets" of this bunch: S&L assets were worth something. For this bunch, the mortgages on these properties were at inflated levels. No way they'll get all the money back. Correct me if I am wrong.

Besides, I sick of these capitalists squealing like pigs for their share when their gambling debts pile up.

You're not a true capitalist, are you, friend?

Didn't say I like it, Roger. Just reminding Max of the Lou Holtz rule in hopes of preventing a heart attack.

Don't get too complacent, Durango. You are missing one hellaciously big point. This bail-out was initiated, engineered and is being handled by the Bush administration and their patronage/reward-appointed bureaucrats.

Don't forget Katrina/"Brownie," Iraq/WMD/Rumsfeld/Wolfowitx/Perle/Feith/Paul Bremer, Cheney/EnergyPlan, Bush/Enron, DOJ/Gozales/Goodling/Ohlson/Tim Griffin . . . If the Bush administration handles it with their usual professionalism and success, we may end up owing 12 trillion dollars to Andorra with a 17.8 APR.

May be necessary? OK, so my eyes glazed over and my head hit the desk in economics class, but given the bit of the story below, I have to SCREAM, "NO, NO, NO!"

"Senior aides and lawmakers said the goal was to complete the legislation by the end of next week, when Congress is scheduled to adjourn. The legislation would grant new authority to the administration . . ."

NO, NO, NO! NO! DAMN! NO! HELL, NO! I'm willing to grant nothing to this administration except a trip to the rack, gallows, guillotine or Ole Sparky. OK, in honor of the Secret Service, scratch that last thought. A trip to the wood shed. (Pretty namby-pamby, huh? Stocks, maybe? The kind from the 1600s, with plenty of rotten tomatoes at hand? Oops, I bet I overstepped bounds again. Better shut up, huh?)
Sadly Congress, the "jury" which has the power to swat hands isn't prepared to do it, even with a feather.

I cut off the end of my post. Add . . . especially of a Bush lobbyist can make a profit by arranging it and a Bush appointee can get a job with the Andorrans later.

Click

Those loans did save our butts, like you say. If we're going to nationalize private companies like Bear Stearns, Fannie Mae, Freddie Mac, etc.; then why stop there? Why not nationalize something that will truly return record profits, like Texaco?

What we need is a Brand New Deal. We need to reinstate the Glass-Steagall Act of 1933. We need to keep Fannie Mae and Freddie Mac under government control and oversight and not privatize them. We need to tighten down and rebuild out infrastructure. Look all around you and you can see where this Milton Friedman fundamentalist view of economics has gotten us. Weak regulatory agencies (FEMA, FDA, etc.) have made us vulnerable to natural castastrophies, bridges collapsing, trains colliding in S. CA., tainted goods from China. And it goes on and on.

The gap between the rich and the poor has widened to unprecedented levels. Why is that? When everything is going fine, corporations want the government to step aside and let the free market run wild, filling their pockets with obscene amounts of money (consider that Lehman Bros doled out 7 Billion in bonuses last year) but when it goes belly up, they suddenly beg the government to bail them out and save their asses. When things stabalize, they'll once again want the government to get lost.

Republicans slay me. We the people can't get a national health insurance because they are so freaked out over fears of socialized medicine. so they crash the financial markets with their greed and they want the government to socialize Wall Street.
They preach against the evils of big government. Until they need it.

How 'bout we let government work for the little guy for awhile.
Vote Democrat.

You said it Doc. Don't want to see the fine print on those agreements. They are probably getting paid extra for dumping their losses on the taxpayers while they run away with the profits.

Quoting a football coach on a financial crisis; Durango should have been head of an agency for Bush. He has that right wing repub sensibility. Say something stupid that is beside the point and act like no one has any better sense than to know you have just screwed them once again.

It seems to me the Friedman crowd is in a pickle. They would never ever protect the little guys (the bottom 95 to 98 percent income bracket), in fact quite the opposite. However, they appear to be willing (with reluctance) at the moment to protect the super rich in large part due to the debts we've incurred from the ME, China, Japan, etc.

Something is not right... The economic history of what we have forced through the likes of the IMF and World Bank during crisis from Chile, Brazil, Argentina, Bolivia, to the Russian and Asian financial crisis.. is not what appears to be happening here, yet.

Could the debt pressures from China and Saudi Arabia be precisely what is keeping millions more Americans out of bread lines and ever increasing tent cities at the moment? If so, this may prove to be the greater irony in all of this mess.. far more than the fact the Friedmaniacs are now reverting to the likes of Keynes and FDR to save their selves.

One can only hope... but I don't see any plan to both correct the value of peoples housing while insuring millions are able to restructure and keep a roof over their heads. Maybe this will be the best way to measure true intent.

Stock up on rice... and keep the bugs out... it could be a very bumpy ride ahead for most of us.

I am remembering a thoughtful piece in the NYT's earlier this week that made the arguement against what we did in bailing out Chrylser in the early 80's. That salvage job prevented Chrysler from succumbing to the market and being made relevant by some new owners. That in turn put no pressue on GM and Ford to change their ways regarding the types of cars they designed and built. So now, they too are at our [the public's] door seeking a handout.
I do not pretend to understand the economy - but, are we making a similar mistake now in not allowing these companies to go out of business, allow others to purchase their most viable assets, and teach those who tout the market a real lesson in the market? I don't know but I do know this screams out for justice against those high earners and their lackeys who got us to this point. Justice might start with a 98% income tax on all their assets over the past 8 years. That would likely return the public's money just now invested in their scams and follies.
Don't tell McCain - he won't be happy with my tax suggestion - he just likes to do the phony moral outrage about greed and avarice.

FREE MARKETS. . . FREE MARKETS....FREE MARKETS....FREE MARKETS....FREE MARKETS

are sure getting goddamn expensive.

They just never said who was gonna get the free stuff.

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All kidding aside here's some talking points I plan to heed:

The only thing this move of buying up the bad debts accomplishes is postponement.
It doesn't change the reality on the ground.

$47 trillion debt market is still in deep trouble, and so are the countless companies, consumers and governments that depend on it.

Suspending short trades it cause a huge sell off of stocks.

To fund the Fannie Mae, Freddie Mac, AIG and new banking bailouts, it's estimated that the U.S. Treasury will need to borrow at least $1 trillion in new money from investors in the United States and abroad.

By protecting investors who invest in high risk, higher yield packages they will
discourage investors to invest in regular T-Bills which have lower yields. It's called
shooting oneself in the foot...fewer buyers for T-Bills Fed and Gov will need for the coming
bail-outs.

Underneath all the glory...homeowners are still unable to meet their mortgage payments.
What's the government gonna do with them?
Yard sale?

This will be a short lived rally. Plan on it. No more

And with all this good news gold surged another 130 pts!!

Go gold.

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STFU and GBTW. These questions are above your pay grade.

Now, THIS, ladies and gentlemen, is the kind of discussion I love to see on an ATB thread! Thanks to all for the commentary, and may there be many more posts.

"What we need is a Brand New Deal. We need to reinstate the Glass-Steagall Act of 1933. We need to keep Fannie Mae and Freddie Mac under government control and oversight and not privatize them. We need to tighten down and rebuild out infrastructure. Look all around you and you can see where this Milton Friedman fundamentalist view of economics has gotten us. Weak regulatory agencies (FEMA, FDA, etc.) have made us vulnerable to natural castastrophies, bridges collapsing, trains colliding in S. CA., tainted goods from China."

Ya got it, Radfemhedonist!

The one point that I have 'discussed' with many people through the years is that the US economic structure should either be capitalistic and free-enterprise---and remain that way regardless of the consequences---or (my personal choice) it should be operated for the maximum benefit of the maximum people in the population. In expressing my opinion through the years (I'm 60), I've been called socialist, communist, anti-American, stupid, and other names in language that I don't use.

It doesn't make a difference if the government made a profit after the bailout of Chrysler, or if the government will either see a payback or profit from the silliness that has gone on recently. Either Chrysler, AIG, Fannie Mae, and whomever else is lurking around the corner should be allowed to fail and all should suffer the consequences---because that's a true free market system---or a systematic, understandable, rational, beneficial-to-all economic system should be put in place---and left alone.

When the rules change almost daily, when regulations and laws are put in place to benefit one group over another, to deal with the crisis situation of the moment (often caused by the last changes in the rules), the end result is what we're living through in 2008. And to think that there are still people who want to continue the madness and cruelty of the past eight years!

Do I think that anything while change for the better, anytime soon? No, which is why I sign myself, "RealisticDave."

From Senator Bernie Sanders:

"...-I wonder about 3 years ago, had we listened to President Bush, if we had listened to John McCain, if we had listened to the Republican leadership and we had privatized Social Security--can one begin to imagine the anxiety that would be existing all over this country in terms of senior citizens wondering what kind of retirement they would have, what kind of funding would be there for their remaining years? So thank goodness we did not follow the advice of President Bush and John McCain and the Republican leadership; thank goodness we kept Social Security strong. ...

We have heard testimony from energy economists who are telling us that between 25 percent to 50 percent of the cost of a barrel of oil today has nothing to do with supply and demand, it has nothing to do with marketplace fundamentals; it has to do with speculation on the part of financial institutions that are driving oil prices higher, and now, by the way, with that money coming out of oil futures, driving prices down, creating a lot of volatility. ...

Both of these crises are tied to the same extreme economic ideology--an ideology which says the Government should play no role--or a minimum role--in protecting consumers; that we should put all of our trust in the honesty and the integrity of the heads of large multinational corporations.

I should mention that both of these crises are also tied to the work of one former Member of the U.S. Senate, and that is the former chairman of the Senate Banking Committee, Phil Gramm of Texas. To a significant degree, a lot of what we are experiencing today is related to the disastrous changes to Federal law that deregulated both the energy industry and the financial industry, and that effort was led by former Senator Gramm.

To recap, as chairman of the Senate Banking Committee in 1999, then-Senator Phil Gramm, spearheaded legislation that bears his name, and that is the so-called Gramm-Leach-Bliley bill that broke down critical regulatory safeguards that the Government put in place after the Great Depression to prevent exactly what we are experiencing today.

rest on my name. Worth the read.
.

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Remember a few years back Bush was talking about something he coined the 'ownership society'? It was government delibrating encouraging high risk loans without any interference or regulation. When Bush said on Tuesday that Wall Street had gotten drunk on profits, how could you blame them? And guess who was pouring those potent concoctions?

Eureka, you brought up an excellent example in Chile. When their economy collapsed in 1975 after the overthrow of Allende, it was the perfect place for Friedman to test his radical economic theories of a totally free market. He installed his Chicago Boys to advise Pinochet. The free market that was produced there is potent example of how bad things can get under that philosophy. A very small percentage of the population got extremely rich when the restictions were lifted but it left over 95% of the rest of population in destitute poverty. Pinochet was only able to maintain any semblence of stability with the extreme repression and torture of Chilean citzens. The 'free market gone wild' theory proved to be an utter failure plunging the country into further economic despair and killing hundreds of thousands. If it was proven to be a failure, why the hell does it still hold any credence today at all? Because that small percentage who is making all the money has gotten addicted to it. They'll crush anyone in their way to get their next fix.

durango,
The US gov is going to take all the bad loans. We as taxpayers are going to lose a lot of $. The blank check was written several weeks ago and it finally got filled out and cashed today. It was a matter of time. We better update that Bush Legacy bus, or maybe we should get a Bush Legacy train.

They'll crush anyone in their way to get their next fix.

Posted by: Radfemhedonist

Many many more countries than just Chile. No matter how miserably they fail and they always fail everyone, except the very rich..... the Chicago Boys just keep claiming more shock is needed.... and make no mistake, they mean shock, torture, police state, starving people, and killing any attempts by labor to organize... and they absolutely love privatization of everything, especially government. Sound familiar?

Naomi Klein's book - The Shock Doctrine lays Friedman and the Chicago Schools miserable history out..

Think Scaiffe, Manhattan Institute, Hass, Walton's, Rockefeller etc... these billionaires are winning and have been for decades. Why should we expect them to allow change now?

4 Ways to Turn a Recession Into a Depression
September 18, 2008 02:22 PM ET | James Pethokoukis | Permanent Link

Hoo, boy. Wall Street, as well as America's Investor Class, ought to find the following statement reassuring. Here is Senate Majority Leader Harry Reid on the credit crisis, "No one knows what to do. We are in new territory here." Well, my first piece of advice would be to do nothing. Punish Wall Street? The market is already doing that. Crack down on super risky home loans? The market is already doing that, too.

Moving forward, however, Washington might want to crack open some history books and examine just how bad policy from Washington turned an economic downturn into the Great Depression. Here are handy tips for what not to do:

1) Close the banks. This is the biggie-not letting the financial system disintegrate. Thank goodness it is already being handled by de facto copresidents Hank Paulson and Ben Bernanke. (In the end, though, the American taxpayer may well have to provide M.O.A.B.-the Mother of All Bailouts.) Indeed, Bernanke is a student of the Great Depression and understands well the key role of the Federal Reserve in such a crisis. In fact, he has explicitly blamed bad Fed policy for turning a 1920s downturn into a 1930s economic catastrophe.

2) Raise taxes. Another classic. The Revenue Act of 1932 was at the time the largest peacetime tax increase in American history. The top rate, for instance, went from 25 percent to 63 percent. Economists agree this is one of the dumbest things Herbert Hoover did. Alas, it is a mistake we might be getting ready to repeat.

3) Unnerve business. With the economy shaky, the last thing you want to do is to raise uncertainty about government policy as it affects business. And there is a lot of that going on right now. Will the Bush tax cuts be extended? Will government nationalize healthcare? Will carbon emissions be taxed? The same was true during FDR's administration. Recall the anticompetitive National Recovery Administration, for instance, with its myriad business rules and regulations. As economic historian Amity Shlaes noted in this interview earlier this year: "Both the Hoover and Roosevelt administrations (but especially the Roosevelt administration) were so unpredictable. That hurt the economy very much, and when I went back and saw the extent, I was astounded.... During the Depression, you heard the phrase "bold, persistent experimentation" all the time. We've been taught that was good. Somebody had to do something, was what we learned. But what I saw was this enormous cost, especially during the second half of the 1930s."

4) Start a trade war. The raising of tariffs always gets plenty of blame for the Great Depression. And while most economists have learned the lesson of Smoot-Hawley, politicians have not. There are sorts of anti-China bills floating around Congress that seek to penalize that nation for its weak currency, blamed by some for our huge trade deficit with that nation. A weak economy in 2009 might provide more momentum for protectionists on Capitol Hill.

So how to improve the economy? Cutting taxes and avoiding hastily prepared new regulations are good starts. Reforming our entitlement system would also go a long way to restoring the faith of international investors in our economy and government.

Analysis: Washington's Trillion Dollar Wall Street Bailout
September 19, 2008 09:35 AM ET | James Pethokoukis | Permanent Link

So after the Mother of All Bubbles comes the Mother of All Bailouts. Main Street saves Wall Street. It now looks like Uncle Sam will create a new entity to take hundreds of billions of bad debt off the books of America's major financial companies. (Look for this to get done before Election Day, if not early next month.) "This is a gigantic step forward, the only way to fix the crisis," writes Ian Shepherdson, economist at High Frequency Economics. "Economy still a mess, but systematic risk way down."

Details are still forthcoming, but one possibility would be an $800 billion fund to purchase toxic bank assets. But whatever forms it takes, Congress will provide something close to a blank check to solve the American banking crisis. Already the Treasury Department has come up with a one-year, $50 billion guarantee of money market funds. You have questions. Here are some answers.

Is a bailout necessary?
Look, the financial system probably couldn't take another week like the one we just went through. Stocks plunging, credit markets freezing. As economist Robert Brusca puts it, "The proposed US government rescue plan comes at the end of a week of almost unprecedented turmoil on world financial markets amid a crisis of confidence in banks."

The government had to get ahead of the curve and quit reacting on a case-by-case basis. If you look at banking crises in Japan and Sweden, for instance, all roads eventually led to a government bailout with taxpayer money at risk. The rule in these cases seems to be the sooner, the better. If you want more evidence, markets around the world and here in the United States are soaring on this news. Strategist Richard Bernstein of Merrill Lynch, in a research note, says the bailout plan is "an opportunity for the government to solve the on-going problems through one system-wide solution."

No, I mean could we have avoided needing a bailout?
Perhaps the government could have offered this sort of plan a year ago and dispensed with the massive rate cuts and the new loan facilities from the Federal Reserve. Clearly neither Ben Bernanke or Hank Paulson thought the situation would escalate the way it has. Recall that Bernanke at one point called this a $100 billion problem. It now looks like he was off by a factor of ten or 20.

No, I mean could we have avoided the Mother of All Bubbles leading to the Mother of All Bailouts?
As long as we have markets and humans there will be bubbles, whether in stocks, homes, Beanie Babies, tulips, or whatever. But as far as the housing/credit bubbles go, I think it could have been avoided. Alan Greenspan cut rates too low and left them there for too long, creating an extreme financial situation that Wall Street tried to profit from. Uncle Sam also fed into that market distortion by making greater homeownership a national goal, using both tax policy and the regulation like the Community Reinvestment Act to, essentially, push capital into homes. And were regulators as tough as they could have been? Obviously not.

Can we really afford a $1 trillion to $2 trillion bailout?
Yes. Now we are definitely talking about a lot of money. In addition to this bailout, we also have $9 billion in losses from the collapse of IndyMac, $29 billion of guarantees from the Bear Stearns bailout, $85 billion of guarantees from the American International Group bailout, and up to $200 billion for the Fannie Mae/Freddie Mac rescue. (Plus, Detroit wants a $25 billion loan to help it go green.)

Current U.S. public debt is 60 percent GDP vs. a bit more for Germany and France and nearly 200 percent for Japan. But consider that every year that we don't deal with long-term Social Security and Medicare liabilities adds $2-3 trillion to that total annually, currently $40 trillion or so. Yet markets don't even seem to notice. Nor does our $13 trillion economy. Or remember when Congress passed Medicare Part D? That was like adding another Social Security program to our long-term national debt. (Actually worse, Social Security has $6.8 trillion in long-term liabilities. The prescription drug benefit has created $8.6 trillion in long-term liabilities.) Again, the bond market didn't seem to notice. But the Wall Street bailout probably does make entitlement reform a front-burner issue for the next administration.

But aren't there other things we could do with the money?
Assuming you wanted to borrow $1-2 trillion, you bet. The Pickens Plan to supply 20 percent of U.S. energy from wind supposedly cost $1 trillion. Fixing America's infrastructure problem. That would also cost about $1 trillion. How about $10,000 "baby bonds" for every U.S. newborn? The list goes on and on.

What should Washington do next?
The worse the economy does going forward, the more this bailout is going to cost as home prices fall further and more Wall Street debt goes bad. Dramatic cuts in corporate and capital gains taxes might be a good start. This might be the ultimate case for tax cuts paying for themselves. In addition, we need to reform entitlements and reduce that $40 trillion in long-term liabilities. Doing so would send a message to global markets that America is getting its financial and fiscal house in order.

Big Government's Big Role in the Credit Crisis
September 18, 2008 02:20 PM ET | James Pethokoukis | Permanent Link

"The private market screwed itself up, and they need the government to come help them unscrew it." So says Barney Frank, chairman of the House Financial Services Committee. Did Wall Street make mistakes? Absolutely. But so did our fellow Americans who took out loans that they shouldn't have.

And so did Uncle Sam. The more you look at the history of the housing-spawned credit crisis, the more you notice Uncle Sam popping up, Zelig-like, in every scene. Fannie Mae and Freddie Mac were government-birthed entities that decided to buy securities tied to subprime loans. And it was government officials on Capitol Hill, the recipients of millions in campaign donations from the F&F lobby, who decided not to rein in those entities. You had the government ' s Community Reinvestment Act nudging banks to make unsound loans. Government banker Alan Greenspan pushed interest rates too low for too long earlier this decade, creating an extreme financial situation that made the crazy Wall Street strategies look temporarily reasonable. And for decades, government has pushed higher homeownership as a national goal, via F&F as well as through the tax code, siphoning off resources that might have been better devoted to other economic sectors.

And now, folks like Barney Frank pretend government just showed up on the accident scene moments ago like an innocent passerby who wonders aloud, "Anyone here know what happened? Anyone?" I mean, how can we try to prevent future financial crises, or least minimize their damaging effects, if we delude ourselves on the causes of the current one?

strange,
Re posting this from above, to help you with the facts.

I should mention that both of these crises are also tied to the work of one former Member of the U.S. Senate, and that is the former chairman of the Senate Banking Committee, Phil Gramm of Texas. To a significant degree, a lot of what we are experiencing today is related to the disastrous changes to Federal law that deregulated both the energy industry and the financial industry, and that effort was led by former Senator Gramm.

To recap, as chairman of the Senate Banking Committee in 1999, then-Senator Phil Gramm, spearheaded legislation that bears his name, and that is the so-called Gramm-Leach-Bliley bill that broke down critical regulatory safeguards that the Government put in place after the Great Depression to prevent exactly what we are experiencing today."

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Yes, I agree that the Gramm bill signed by Clinton in 1999 contributed to this. It ended the wall between investment banks and commercial banks. However, the Community Reinvestment Act was directly responsible for the subprime load debacle. That bill belongs to the Congress.

My point in the above articlea is that Congress bears the responsibility for this mess. The one Trillion dollar price tag will be paid by all of us----repubs, demos, liberals and conservatives. However, I don't think that the public as a whole will ever know the real cause of this mess. The ONLY reason that the Congress appears to be together on resolving this is that they know if the financial system melts then there is a very good chance that they will lose their sweetheart jobs. Since most of them can't do anything of value, they can't afford to lose their cushy job.

My point in the above article is that Congress bears the responsibility for this mess. The one Trillion dollar price tag will be paid by all of us----repubs, demos, liberals and conservatives. However, I don't think that the public as a whole will ever know the real cause of this mess. The ONLY reason that the Congress appears to be together on resolving this is that they know if the financial system melts then there is a very good chance that they will lose their sweetheart jobs. Since most of them can't do anything of value, they can't afford to lose their cushy job.

Shades of 1967 and the movie "Divorce, American Style" with Dick van Dyke and Debbie Reynolds. In one scene the married couple played by van Dyke and Reynolds are meeting with their divorce lawyers and dividing up their joint assets. Dick van Dyke's character says: "Let me see if I have this right. She gets the car and I get the car payment. She gets the house and I get the house payment. She gets the country club membership and I get the dues payment." And he says finally: "She gets the gold mine and I get the shaft." (No offense meant, zelda, Ci.Ci, Doigotta, et al)

That about sums up the current financial situation- the multi-millionaire and billionaire executives get the gold mine and taxpayers get the shaft. They keep all the assets and we lowly taxpayers get all the liabilities. How can we refuse such a deal?

Can I get in on this action? The feds can have my mortgage payments and I'll keep our house. If if works for richie-rich, it works for me.

If you had read the Community Reinvestment Act of 1995 you would have read about lowering of qualifications for getting loans and a lowering of capital requirements. All of this was necessary in order to give unqualified borrowers money for a house that they normally would have NEVER received in our country's history. You and I are going to have to 'eat' these bad loans through higher taxes. Most people don't default on their mortgages. However, through the irresponsible provisions of the CRA Fannie and Freddie assumed a lot of bad mortgages that now are simply debt that has to be eaten by someone. Thank the Congress for passing the CRA and Clinton for pushing it and signing the act into law.