Posted on 09/30/2008 6:59:39 AM PDT by reaganaut1
Lawmakers' failure to pass the Treasury's bailout plan Monday could further weaken an economy already hurt by a crisis of credit and confidence
...
Even economists who expressed skepticism about the bailout legislation said action was preferable to no plan at all -- and essential to shore up confidence.
University of Chicago Graduate School of Business economist Anil Kashyap was among those with reservations about the Treasury plan, which he felt didn't adequately attack the problem of low capital levels at financial institutions. Mr. Kashyap also felt that given the fragility of financial markets, the consequences of not acting would be dire.
"This is pretty irresponsible not to pass it," he said. "To stand there and say, 'I'm warming up...I'm warming up...I'm not ready.' "
Without a plan, Mr. Kashyap said, strained credit markets could make it impossible for more troubled financial firms to get short-term financing, pushing them into failure.
"If another big institution fails it could easily set off a bad chain of events," said Douglas Diamond, a colleague of Mr. Kashyap's. Commenting on Monday's action in financial markets, he said, "If this is not enough to get the Congress to act, maybe they just stand by and think that the 1930s were a fluke."
Additional failures could send more investors careening into cash, tying up lending markets to the point that even creditworthy businesses and households may be unable to borrow. Unchecked, that would cut deeply into spending, leading to rising bankruptcies, rising unemployment and a severe recession.
(Excerpt) Read more at online.wsj.com ...
In all this talk about the bailout failure why is ther NOT ONE MENTION OF CHANGING THE LAWS THAT CAUSED IT- I.E. FORCING BANKS TO LOAN TO UNQUALIFIED PEOPLE
ARE WE STILL GOING TO DO THAT?
Well, the 1930's were a kind of fluke. It's highly unusual for the government to intervene so strongly during an economic criris. Usually, the crisis resolves itself in a short while, as the vulnerable entities fail and the stronger entities pick up the pieces. Hoover and FDR changed the game by having gov't try to pick up the pieces. That's why the 1930's were so bad for so long.
It could happen again -- but only if a bailout bill passes.
"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
This pisses me off to no end, the WSJ is one of the largest cheerleaders for “Free Markets” and yet, when that same market dictates that Stocks lose value based on poor decisions, they are now one of the largest megaphones screaming for taxpayer money to prop up that failing market.
They owe an apology to every factory worker that lost their job due to outsourcing and there inconsistent adherence to the “Free Market”, if it is good for a autoworker in MI, it is good for the perfumed princes as well.
Conservatives, in their effort to make a point, are losing their credibility. Suck it up and do something to help liquidity in the financial markets. Otherwise, take the blame for the consequences.
"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
The proposed solution is (apparently) more government do-gooding. And if this course is not chosen, a lot of people will be blaming Conservatives.
How is it that everything gets blamed on Conservatives? Nothing On Liberals?
I support free markets. Our basic problem today is that we don't have free enough markets. I'll stand by my Conservative principles because I'm convinced that adhering to Liberal principles will only cause a larger problem.
I don't see any sky falling anywhere really... sure my 401k lost some value, my son lost a bit on the markets yesterday (because he didn't listen to me!) but no sky falling far as I can see.
Just to test matters, I'm driving over to my bank in a bit to apply for a small business loan. I'll report back, but I expect this will go just fine in spite of the fear mongering in DC.
Cheers,
Lloyd
That folly has gone beyond getting its big ugly foot in the door to now having a designated seat the table. Pure unadulterated folly. IMHO, until at least 2/3 of these socialist scoundrels in the current Congress are tossed out on their collective ears nothing is going to change much. The cancer that we call Congress has progressed too far and has its tentacles too deep in the national treasury.
Good points. I agree.
If you mean with liberals and RINO's you may be right but with fiscal and social conservatives their credibility rose a notch or so, especially for those conservatives in the House who turned a thumbs down to this socialist enabling legislation that was defeated yesterday. This was clearly a case of the cure killing the patient. Now maybe Americans can get a better piece of legislation.
Go get em’ Llyod.
This occult professor must feel kind of like an idiot this morning as the market gains 300 pts. Don’t worry Prof., it’s just your turn to ride the short bus.
"Thanks, is there anything else I can help you with today?"
This is a scam folks, there is no credit freeze
Ridiculous article. Action is needed - it doesn’t matter what.
Thanks a lot WSJ. I’ll never buy one of your stupid papers again.
And this comes from someone who has money, unlike the readers you’re catering to who never buy your stinking paper.
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