Morality of financial Bail out

[royal_archer]

There have always been recessions. the plan has never been to fold every business every recession

you’re joking, right? Tom must go broke and Bill too. Tom needs reviewed to assure he stayed inside the law. Typically people as him do not. Bob does not need Tom. Bob’s business will not fail from Tom’s inability to do shady money deals. Bob may have a cash flow crunch because interest rates may increase however the fundementals do not change. The worst thing the government can do is to give or loan Tom or Bill as both made this problem. Both need to pay for the losses they created.

But what is happening now is the government is going to buy tom’s bad debts instead of letting him deal with his own mess.

 

[royal_archer]

This so called “bail out” is not socialistic by any stretch of the imagination. By law (re: 1999 Clinton admin), banks were required to approve mortgages to people who could never afford to make the payments.

This legislation is an attempt to correct irresponsible previous legislation.

BTW, Since the first of the year, I have lost over $100k if my life’s savings whose earnings were to support me in my retirement and be left to the Church upon my death. As if looks now, there may not be anything left to give to the Church.

The bottom line is that one socialist intrusion of the free market caused the problem and some think the answer is more of the same?

BTW we lost a lot of money also but first it was only a paper loss. if the ecconomy recovers we will get it all back and second this short term loss due to the settling of the market is nothing compared to what we will have to pay over the long run in higher taxes and inflation.

 

[stinkcat_14]

BTW, Since the first of the year, I have lost over $100k if my life’s savings whose earnings were to support me in my retirement and be left to the Church upon my death. As if looks now, there may not be anything left to give to the Church.

I would say that most likely this is due to poor investment decisions. After all, the S & P 500 is only down about 12% since the first of the year. So if you were diversified, your losses would be minimal and well within the normal variance of stock returns. Also, if you are close to retirement, you really need to lower your exposure to stocks in order to reduce your risk, since you have less time to recover from any shocks.

 

[royal_archer]

Were there business decisions illegal? Were they the only ones to blame? The answer to both of these questions is clearly no. The CEOs of the companies that are to blame are mostly gone. So a lot of the people whose fault this mess is are feeling the consequences. Most of the rest of the people are unreachable. So why insist that helping those who remain is immoral?!

But the companies remain. If you buy a company you buy it with all of the baggage that comes with it. If you buy a bad mortgage you have chosen to accept the bad decision. If there was fraud involved, then the current owners should sue the previous owners. But if I buy a lemmon of a car I can’t run to the feds to buy it off my hands because I made a bad decision. On the contrary I buy cars from reputable dealers and get lesser cars so Ican get the extended warranties and still have enough money to cover repairs. Being that I made a good decision I should not be forced to buy my neighbors car off him because he got into a bad deal. I may give him a ride to work, etc. and voluntarily helping him out in his time of need But the immorality comes when you take from one person to give to another.

 

[LeahInancsi]

I would say that most likely this is due to poor investment decisions. After all, the S & P 500 is only down about 12% since the first of the year. So if you were diversified, your losses would be minimal and well within the normal variance of stock returns. Also, if you are close to retirement, you really need to lower your exposure to stocks in order to reduce your risk, since you have less time to recover from any shocks.

I beg to differ with you being that you have no idea how my money is invested. The portion of my investment that has lost the most money is in 50% bonds and the remainder diversified. The 401(k) that is a little top heavy in stocks has gone down only about 18%.

BTW, I’m a CPA with an MBA and know a little bit about the economy and finance.

 

[jc-servant]

This is one the old canards that keeps floating around these threads and I what I have found interesting is that not once has anyone offered the slightest shred of proof for this ridiculous assertion. After all, mortgage brokers and nondepository lenders are not subject to the community reinvestment act. In addition, if you look at the home mortgage disclosure act data, most of the subprime loans were not made to poor people. Finally, a couple years back, banks were promoting subprime lending as a profit center, not a something they had to do to avoid having the government on their back.

You are so right. People keep listening to the talking heads repeat this baseless blather without checking the facts for themselves. Everything gets politicized in recent years whether or not it has any basis in reality. If people would simply do the research on foreclosures, the neighborhoods/price ranges that they are in and the total numbers of foreclosures to date, then they would see that “forcing” lending to unqualified buyers is not the source of our current mess.

There is no simple answer for such a complicated situation and we cannot blame it all on any one group or person or law or lack of appropriate laws. We are in the beginning of a “perfect storm” of bad decisions/conditions that took years to come to fruition. The seeds of this disaster were sown by many people from far left to far right and all points in between. Now we are all going to reap some of the bad fruit regardless of our culpability.

What I don’t see here are many people trying to see Jesus in the faces of those around us. It is, those people caused this or those people deserve what they get. . .lot’s of charitable thoughts, not.

 

[stinkcat_14]

You are so right. People keep listening to the talking heads repeat this baseless blather without checking the facts for themselves. Everything gets politicized in recent years whether or not it has any basis in reality. If people would simply do the research on foreclosures, the neighborhoods/price ranges that they are in and the total numbers of foreclosures to date, then they would see that “forcing” lending to unqualified buyers is not the source of our current mess.

There is no simple answer for such a complicated situation and we cannot blame it all on any one group or person or law or lack of appropriate laws. We are in the beginning of a “perfect storm” of bad decisions/conditions that took years to come to fruition. The seeds of this disaster were sown by many people from far left to far right and all points in between. Now we are all going to reap some of the bad fruit regardless of our culpability.

What I don’t see here are many people trying to see Jesus in the faces of those around us. It is, those people caused this or those people deserve what they get. . .lot’s of charitable thoughts, not.

We all need to be focused on the truth, even when the truth interferes with our political dispositions. I for one, am not a big fan of government regulation. However, when someone makes a claim, we need to examine to claim to see whether or not it is true. And if the truth of the claim goes against our political inclinations, we have to be strong enough to admit that.

 

[royal_archer]

…What I don’t see here are many people trying to see Jesus in the faces of those around us. It is, those people caused this or those people deserve what they get. . .lot’s of charitable thoughts, not.

There is a difference between a desire for accountability and a desire for revenge. This is a situation where We can have a desire to help people but still hold them accountable for their bad decisions but that isn’t happening. For instance you hear politicians saying they want to ensure people stay in their homes even if it means the courts adjust the amount they owe. What they should be saying is we need to get these people into a house they can afford. If we as a society do no hold people to their word and their responsibilities we run a much greater risk to society.

 

[royal_archer]

Thanks for all your (name removed by moderator)ut.

It looks like the 700 billion bail out did not result in the ill gotten gains and stock surge I was afraid off.

 

[goofyjim]

This so called “bail out” is not socialistic by any stretch of the imagination. By law (re: 1999 Clinton admin), banks were required to approve mortgages to people who could never afford to make the payments.

This legislation is an attempt to correct irresponsible previous legislation.

BTW, Since the first of the year, I have lost over $100k if my life’s savings whose earnings were to support me in my retirement and be left to the Church upon my death. As if looks now, there may not be anything left to give to the Church.

If all it does is prop up someone’s earnings with no expectation for it to be paid back, it is socialism.