Posted on 09/24/2008 6:27:19 PM PDT by Tennessee Nana
President Bush explains big bailout as high-stakes debate heats up.
NEW YORK (CNNMoney.com) -- President Bush used a prime-time TV address on Wednesday night to press his case for a $700 billion bailout of the nation's shaky financial system.
The aim of Bush's proposal is to restore confidence to the credit markets, which are at risk of freezing. Should that happen, experts say, the U.S. economy could seize up - threatening easy lending to businesses and consumers, a loss of jobs and a severe economic downturn.
"We are in the midst of a serious financial crisis," Bush said.
Banks have restricted lending, credit markets have frozen and businesses and families can't afford to borrow, Bush said.
"The market is not functioning properly. There is a widespread loss of confidence," he said. "America could slip into a widespread financial panic."
Indeed, in recent days lawmakers, economists and administration officials have used the words "crisis," "calamity" and "meltdown" to describe the possible ramifications.
The program, first unveiled six days ago, would amount to the most sweeping economic intervention by the government since the Great Depression. The high-stakes debate over it gained rapid momentum on Wednesday.
Bush has called a White House meeting for Thursday afternoon to discuss the bailout. Congressional leaders and presidential candidates John McCain and Barrack Obama are expected to attend.
Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke have spent the past week lobbying for the Treasury's proposal. They have met with lawmakers privately and been grilled on Capitol Hill on successive days.
(Excerpt) Read more at money.cnn.com ...
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus
A 700 billion-dollar laxative is needed to relieve the financial system.
If the possibility is that the bad paper will eventually be made whole and we are likely to need foreign investors to fund the laxative why not let the world's investors buy the paper discounted to attract them? Thus eliminating governments usual huge fees. 700 billion is only 3.5 percent of the 20 trillion invested worldwide.
Or, to free up liquidity for commerce and give time for the market to solve the problem why not ease banks' reserve requirements? I know that demand deposits have reserve requirements that can be adjusted by the Fed. I assume these restrictions affect the amount of money the banks can lend.
Most important: how about the bad dudes in Congress clogging our government by, for and of the people? How about a November 4th laxative to relieve our Republic?
PING
He’s talking down the economy.
Bernanke is creating a liquidity crunch in coordination via the Money supply.
All of the sudden there is a “big” crisis.
This is a bailout of bets by the hedge funds and gazillionaires.
Costs to the taxpayers?
________________________________________
Bush said Zip...
What would Washington, Jefferson, and Madison do? We really need to get back to that kind of country...
“A package for whom? What are the principles? Details?”
It’s basically the same way he pushed Immigration Reform.
Claim a crisis. Demand immediate action in congress avoiding traditional committee rules. When that fails, send Cheney. Cheney doesn’t work (didn’t try hard either). Then have personal meetings with Congress. That doesn’t work, go on television to the people, and make broad claims of crisis while giving the fewest details of the bill and no explanation of its effects.
Didn’t work then. Hope it doesn’t now.
When Bush acts hasty and screams crisis, that is when to least trust him.
Burbank Karl said earlier he saw on CSPAN that the plan was not to bail out the market value of the paper, but worse, its book value.
I’ll say it again, this whole thing is playing out like his immgration bill routine. Last time the crisis element was vaguer and he spent more time insinuating opponents were racist and irreligious, ungiving. This time a “crisis” is suggested, but not explained.
I truly despise the people in Washington. We need to fire them all, and prosecute them vigorously.
Fact is that not everyone deserves a home or business capital like some birth rite.
So what if there is reduced loans.
What ever happened to 20% down and proof you could pay the loan?
Or what about a business loan where people show a real business plan and get either a bunch of cosigners or put their home and other assets up?
Stupid is a stupid does.
it’s hard for anyone to buy these assets. This is what happens when you make loans to people that shouldn’t get loans. Who wants to buy such garbage?
We know who caused the problem: the freddie/fannie and that was part of govt. They were able to grow and grow without anything to keep it in check. It’s like a virus.
So the free market is simply not able to solve this problem. Only govt can theoretically solve this problem but the govt can also make it an even bigger problem. This is totally screwed up.
What ever happened to 20% down and proof you could pay the loan?
well with freddie/fannie (and unlike every other company) they didn’t have to worry about risks
Whoa! Straight down. Asian markets are open.
yitbos
Heard any poop on the late afternoon $25B bailout of Detroit?
yitbos
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.