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It's impossible to be "on a road to financial disaster" when you're already in one. I keep waffling about what and how much the federal government should do. I also worry that European and Asian countries, whose citizens don't object to government financial tinkering, will stabilize first and there will be massive capital flows to those countries. Then I think that, if the US is still wobbly, those countries' recoveries will be tenatative.

Basically, I just don't know.

Basically, I just don't know.

At least you're more honest than most of the politicians out there.

A big part of my thinking on this is that THIS generation should feel whatever pain is associated with our financial sins, and not that of my kids or grandkids.

The market will adjust. Killing this stimulus bill is better than passing it.

kittykat, what they shouldn't do is waste the nation and worlds remaining limited supply of capital. The rest of the world is not going to stabilize without us. They are in worse shape than we are and will continue so without exports. The bad thing is once this farce is done we will still have to go through a depression. There's no getting off that road. The government cannot spend us off on a detour. It's like a family spending itself into debt on furniture instead of education. While the furniture is nice it isn't going to do anything to increase future income (GDP). Fact is this course of action actually ensures decreased future income (GDP) because of the interest payments.

Our economy (GDP) is 13 trillion. Wall Street using leveraging and other debt shenanigans in the last 20 years produced a financial weapon of mass desstruction. The banks and insurance companies lost over 7 trillion. It forced the feds and GWB to abandon free market and intervene otherwise all our top banks and insurance companies would close causing social and economic chaos that can lead to riots, food shortages and etc. The infusion of money is used to buy time so a way can be found to write down these bank losses slowly without triggering chaos. Unfortunately no matter who won the election in 2008, that POTUS is basicly screwed (pardon my French) because the losses created by Wall Street is too great for even the feds to cover. Residential mortgages caused 7 trillion in damage, commercial real estate is next as malls, office buildings and hotels are losing tenants and business. Most of the developers and owners have 5 year balloon mortgages coming due in mid 2009. Without rent, it would be hard for these developers/owners to get refinance thus they will be the next shoe to fall in 2009 socking the banks with commercial real estate mortgage defaults. Finally the rising unemployment is causing many people to default on credit cards, college loans and etc. Following the commercial real estate collapse will be personal debt/credit card defaults. Our banks will essentially be swamped with additional losses on top of the ones covered by the feds. Where is the feds going to get the money. Keep an eye on the Treasury auctions, because if foreign countries do not buy our notes for future expenditures and interest payments on our debt, our government will become insolvent and our country and the world will financially collapse. Let us say if by chance we survive and able to cover all these losses, the amount of US dollars circulating in the system will devalue our buying power. In other words inflation or hyper inflation will destroy our buying power form our paychecks and worst for older people, the buying power of their fixed income pensions. Either way, the American people will suffer a degrradation in their standard of living and hopefully our society can survive the stresses that will come in the future. The numbers and stats are available for all to see.