Its strange but when Imp mentions the name Barney and bending over etc, its somebody else who comes from your state that fits the bill....

Do you think it's a good idea to keep them going at all costs??

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"bellum omnium contra omnes; atque in eo bello jus esse omnibus in omnia."
Thomas Hobbes

"Homo Homini Lupus"
Thomas Hobbes

Yeah i think its better in our long term interests to keep them afloat, seeing them go under would be more horrific for our economy than the great depression. (Add in other banks like Indy going down and possible companies like GM folding we could well lose our status as the worlds greatest economy).

What do you think will be the consequences of intervening in the free market and to keep bad companies alive??

Bailing them out sounds like Japanese medicine for problems, but I doubt it will work in the case of the USA. The Japs got defaltion thanks to their approach, but the US will get much higher inflation rates, thus lower standard of living.

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"bellum omnium contra omnes; atque in eo bello jus esse omnibus in omnia."
Thomas Hobbes

"Homo Homini Lupus"
Thomas Hobbes

It is ironic that the most free market administration in history has to resort to saving whole industries but two things on that...

Firstly they're not neccessarily "bad companies". Sometimes the market is just in dire trouble and now seems that sort of time, even without human error and corporate greed folks can still wind up broke. Also they are not just any old "companies", the reason they are the 2 biggest mortgge companies in the world is because we are the world's greatest economic powerhouse. If Canada was the world's greatest power then the Canadian mortgage firms most powerful in Canada would likely be the biggest in the world and to keep that status is more important than some free market mantra about letting those who make bad decisions suffer and all the usual hot air that comes from the talking points crowd.

Secondly its not a bail out at this point, nowhere near that. So far these are just loans that have been offered by the government which the two giants are yet to take, and they are repayable. For it to be a bailout, the loans would have to be issued, and the debt written off whilst both companies still survived and didn't go under. Or that more money needed to be pumped in than the money loaned, and thus a continuous bail out. We're not even close to that yet.

When market conditions change and a company can't adopt, it's a bad company. Capitalism is as easy as that and any interference in this "game" is bad as proven throughout history.

Funny to see how fast you are willing to give up free market capitalism and to call it a mantra.

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"bellum omnium contra omnes; atque in eo bello jus esse omnibus in omnia."
Thomas Hobbes

"Homo Homini Lupus"
Thomas Hobbes

At Fannie and Freddie .... and even at the private investment banks .... the profits were privatized but the risks were socialized. The collapse of Fannie and Freddie would have caused a catastrophe. The government didn't have much of a choice rather than bailing them out. But the whole thing is another good example for bad regulation:

Fannie and Freddie should never have grown so big. Normal financial-service firms should have been dealing in the safe, middle of the road mortgages, but those companies were crowded out into sub prime mortgages instead. And most important ... if you cannot let companies fail in a bust, then you must contain them in a boom.

The best solution for the taxpayer and the economy would have been to nationalize Fannie and Freddie, break them up and sell them on. Of course the problem would have been, that formally nationalizing the twins would have doubled the public debt. But only in bookkeeping terms, the liability is already implicit anyway.

This is exactly why letting politics near economics is so expensive. Turning rational money decisions into a national war of "My company is bigger than yours" is step towards the Soviet Union style propaganda and state companies.

Look, this is all bullshit. Those of us who work as appraisers have seen this coming for years. The sub-primes arent even the problem. Technically, as long as the credit score was indexed to the interest then the risk against value is the same for prime, sub prime or prime cut, it doesn't matter.

If, however, your portfolio is valued at a million and worth less than half that, then you may have a problem

The whole thing is because the homes are all overvalued and the reason for that is that the only way you could stay in the appraisal business in the the last 5 years was by giving the loan officers what they asked for, which is the reason I'm no longer in the business. Being a party to ongoing fraud in hundreds if not thousands of instances is just a little much for my blood pressure. It wasn't, apparently, much problem for the loan officers the underwriters or the banks, however, and it still doesn't seem to be. As banks fall left and right, I don't hear of anyone being arrested or going to jail and the only people you guys want to screw is the only one who really had no hand in the whole thing and didn't even know it was going on, the consumer.

Isn't conservative Republicanism wonderful?

When I took out my mortgage, I was essentially saying that I knew how much it would cost me every month, and that I agreed to pay that much. I have no sympathy for someone who's taken a loan they could ill-afford, regardless of what a lender tells them...

This has nothing to do with "conservative Republicanism". It has to do with absolute fucking retards taking out mortgages they knew they couldn't pay.

If anything, Bush just bailed those sorry sacks o' shit out...

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Sayeth John Drake - 10/13/08: "OK, you're right, I admit to LYING"

Actually, the people who don't understand how interest works *didn't* know that they were more than likely not going to be able to afford to make the payments.

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Who does vote for these dishonest shitheads? Who among us can be happy and proud of having all this innocent blood on our hands? Who are these swine? These flag-sucking half-wits who get fleeced and fooled by stupid little rich kids like George Bush?

--Hunter S. Thompson

How much should I pay to see Bernie Mac?