Who won?

[RawAlex]

Dravyk, the alternative is what? Endless bank failures, a failure of the real estate market, the closing of companies who are unable to get financing, and so on? Yup, it sucks that the greedy banks and investment robber barons will get off (at least in the short term) without true pain, but the only ones who would feel any pain regardless is the public at large. The barons already have their millions tucked away in gold bars, so it isn't going to hurt them. If anything, without a bailout they could end up being even richer relative to americans.

The good news? If the bailout works, the american government could end up holding a trillion dollars worth of loans for a bargain basement price, and when it comes time to sell them they might actually break even.

[Dravyk]

Originally Posted by RawAlex

Dravyk, the alternative is what?

Yeah, I know. It's all so insane is all.

[miz_wright]

Originally Posted by RawAlex

Dravyk, the alternative is what? Endless bank failures, a failure of the real estate market, the closing of companies who are unable to get financing, and so on?

Well, since theoretically the Fed is only supposed to set monetary policy, and theoretically we live in a free market economy: this is beyond the mandate of the governement, theoretically.

Frankly, as much as everyone is concerned with homeowners and individual investors, it occurs to me that if home buyers had declined to take part in risky mortgages and not chased unsustainable returns, much of this wouldn't be of concern.

I mean, Christ on toast: one of the first things I learned in my high school economics class was that with the potential of high rewards comes significant risk - and that seems to have been a lesson forgotten by most in the race to margin CMOs and credit swaps and oil futures.